California Enacts Bill Setting 2030 GHG Goal, Authorizing State Action

On September 8, 2016, California Governor Jerry Brown signed legislation that sets a binding 2030 greenhouse gas (GHG) emissions reduction target of forty percent below 1990 levels. Governor Brown had previously established a 2030 goal at the same level in an executive order. The legislation, Senate Bill (SB) 32, extends the California Global Warming Solutions Act of 2006, which provides the California Air Resources Board (CARB) broad authority to adopt rules and regulations to achieve the GHG emissions reduction target. Commonly referred to as AB 32, the 2006 Act requires CARB to reduce GHG emissions to 1990 levels by the end of 2020.

Under its AB 32 rulemaking and regulatory authority, CARB implemented an economy-wide cap-and-trade program to reduce GHG emissions. CARB recently proposed amendments to the cap-and-trade program that would extend the program to achieve a forty percent reduction in emissions in 2030, consistent with the goal in SB 32.

SB 32 includes a provision that only allows it to go into effect if a companion bill is also passed into law by the end of this year. The companion bill, AB 197, was also signed into law by Governor Brown on September 8, 2016. AB 197 provides additional legislative oversight of CARB. It creates a Joint Legislative Committee on Climate Change Policies to make recommendations to the legislature concerning the state’s climate change policies and to receive information from CARB on reported GHG emissions. The bill also adds two California legislators to CARB as nonvoting members. Lastly, the legislation requires CARB to consider the social costs of GHGs and prioritize direct emissions reductions at large stationary sources and mobile sources in order to protect the “most impacted and disadvantaged communities.”