Governor Brown Proposes “Big Ideas” for Energy and Climate in His Fourth and Final Term

Author: Jon Costantino

Governor Brown was sworn into office yesterday and gave his fourth inaugural address, which also doubled as his State of the State. Though he touched on a variety of other proposals, the Governor kept his laser focused on climate and energy issues. He proposed three ambitious goals to be accomplished within the next 15 years:

• Increase from one-third to 50 percent our electricity derived from renewable sources
• Reduce today’s petroleum use in cars and trucks by up to 50 percent
• Double the efficiency of existing buildings and make heating fuels cleaner

Together with his 2015-16 budget proposal, which comes out Friday (January 9) and will include the largest dollar value to date of Cap and Trade revenues to be expended due to this year’s inclusion of transportation fuels in the program, there will be plenty to digest and debate in Sacramento this legislative session.

Governor Brown also vowed to continue a host of the state’s more progressive energy policies, which include expanding distributed generation, rooftop solar, microgrids, energy storage and electric vehicles. He also called on the broader minds within California to make it all work. He said, “It will require enormous innovation, research and investment. And we will need active collaboration at every stage with our scientists, engineers, entrepreneurs, businesses and officials at all levels.”

“Taking significant amounts of carbon out of our economy without harming its vibrancy is exactly the sort of challenge at which California excels,” he said. “This is exciting. It is bold, and it is absolutely necessary if we are to have any chance of stopping potentially catastrophic changes to our climate system.”

This sounds like a leader who just doubled down on this policy area.

Raising the state’s renewable portfolio standard (RPS) has been widely anticipated in California, which is on track to meet its current target of 33 percent. The 50 percent renewable number, though it isn’t presented as an RPS increase, surprised many as it seems to be the choice over the alternative being discussed, a new low-carbon Clean Energy Standard.

California is also openly discussing setting a new target for carbon dioxide emissions, above its existing goal of reducing emissions to 1990 levels by 2020. With the UN Paris Conference of Parties at the end of the year, California is looking to remain a leader in this area. An early bill already introduced by Sen. Fran Pavley (D), SB 32 this legislative session, would require the state to set a 2050 GHG target equivalent to 80 percent below 1990 levels.

Brown also noted the need for reducing methane, black carbon and other contributors to climate change, as well as managing farms, forests and wetlands to store more carbon dioxide.

“All of this is a very tall order,” he said. “It means that we continue to transform our electrical grid, our transportation system and even our communities.”

Brown called for cooperation and “pragmatic caution” in pursuing his goals.

“How we achieve these goals and at what pace will take great thought and imagination mixed with pragmatic caution,” he said.

These goals are aggressive. The Governor, with this action, made it very clear to all industries (cleantech, oil, renewable, automotive, and others) that climate issues will remain a priority for his final term. Electricity, fuels, and energy efficiency are his big three, which have been the cornerstones for some time in the world of GHG mitigation. Though the topics provide no real surprises, the aggressiveness does.

The speech does set up a series of questions: Will there be a legislative package to promote this? Will this be funded in the budget? How much can already be done via executive branch authorities? Who will be the biggest supporters and opponents? As mentioned earlier, there will be much to discuss in the halls of the capitol in 2015.

For additional information on how these proposals or other AB 32 implementation will affect your business, or for assistance participating in CARB’s continued rulemaking process, contact Jon Costantino at 916-552-2365 in the Energy, Environment & Natural Resources practice group at Manatt, Phelps & Phillips, LLP. Manatt’s involvement with AB 32 and the Scoping Plan’s implementation is extensive. Jon Costantino was Manager of the Climate Change Planning Section at CARB and oversaw the development and publication of the Original Scoping Plan.