BILL ANALYSIS
Senate Appropriations Committee Fiscal Summary
Senator Kevin Murray, Chairman
32 (Nunez)
Hearing Date: 8/7/06 Amended: 8/7/06
As proposed to be amended (LCR 18928)
Consultant: John Decker Policy Vote: EQ 5-2
_________________________________________________________________
____
BILL SUMMARY: AB 32 would direct the regulation of state
emissions by:
1. Establishing a monitoring program,
2. Requiring the state's consultation with advisory and
stakeholder groups,
3. Adopting regulations on reduction strategies
4. Limiting emissions, and
5. Establishing a governor's task force.
_________________________________________________________________
____
Fiscal Impact (in thousands)
Major Provisions 2006-07 2007-08 2008-09 Fund
Monitoring Program
Monitor unknown millions
---- General
Report unknown
--------------- General
Advisory and Stakeholder Groups
Stakeholder group ---------------- unknown
--------------- General
Advisory committee ---------------- unknown
--------------- General
Regulations Governing Greenhouse Gas Emissions Reduction
Strategies
Development and promulgation -----------------
unknown -------------- General
Regulations Limiting Emissions
Development and promulgation -----------------
unknown -------------- General
Governor's Task Force
Task force -----------------
unknown -------------- General
_________________________________________________________________
____
STAFF COMMENTS: This bill meet the criteria for referral to the
Suspense File.
Monitoring Program
The bill requires the Air Resources Board (ARB) to adopt
regulations establishing a monitoring program on or before
January 1, 2008. The program is to annually monitor, report and
verify the amount of greenhouse gas emissions on a statewide
basis. The bill delegates to the board the authority to
determine which emissions to monitor. The bill does not specify
whether the monitoring program is intended to be site- and
emission- specific.
continued
Page 2
AB 32 (Nunez)
Staff note that it is not clear who must do the monitoring (Will
private entities be responsible for reporting to the board?
Will local governments? Will the board?)
If the board will do the measuring, it will require additional
staff and measurement equipment, at a cost of potentially
millions of dollars in 2006-07 and 2007-08. In subsequent
years, the board would need staff to conduct the monitoring, at
an annual cost of hundreds of thousands of dollars.
The bill requires an annual report, but does not specify the
amount of detail or analysis the report is to contain. Assuming
that the report provides sufficient detail to sustain a thorough
analysis, this annual report could cost in excess of $150,000
annually.
Advisory and Stakeholder Groups
The bill requires the ARB to "consult broadly with stakeholders"
and "convene a stakeholder process" to develop programs for
reducing greenhouse gases. The process must begin by March 1,
2007, and is to:
1) Solicit information from utilities on the most efficient
ways to reduce greenhouse gases,
2) Identify barriers for implementing reductions
strategies,
3) Evaluate state investment strategies in research and
development and applied technologies, and
4) Develop plans that may be used to reduce greenhouse gas
emissions.
It is not clear what the board would do to "convene a ?process,"
but assuming it would use the bill's statutory directive to
conduct research on the four issues and convene stakeholder
meetings, the board would incur annual costs in excess of
$300,000, starting in the budget year. The bill does not sunset
the stakeholder process.
The bill also requires the board to establish an advisory
committee to make recommendations about emissions reductions
strategies. This advisory committee, made up of representatives
from communities with significant exposure to air contaminants,
is appointed by the Governor, Assembly Speaker and Senate
President pro Tempore. Costs for this advisory committee,
beginning in the budget year, would likely be minor.
Regulations Governing Greenhouse Gas Emissions Reductions
Strategies
The bill requires the board to adopt, by January 1, 2009,
regulations governing greenhouse gas emissions reductions
strategies. The strategies may be programs, measures, standards
or flexible compliance mechanisms applicable to emission
sources. The bill lists several conditions the strategies must
meet simultaneously.
At the time this analysis was completed, the board was unable to
estimate the cost of developing or promulgating these
regulations. Given the complexity of the related issues, the
board would likely incur costs in excess of $200,000 to develop
and promulgate these regulations in 2007-08 and 2008-09.
continued
Page 3
AB 32 (Nunez)
Limit Emissions
The bill requires the board to adopt, by January 1, 2010, limits
which would progressively reduce greenhouse gas emissions,
beginning in 2012 through 2030.
At the time this analysis was completed, the board was unable to
estimate the cost of developing or promulgating these limits.
Given the complexity of the related issues, the board would
likely incur costs in excess of $200,000 to develop and
promulgate these limits in 2009-10.
Governor's Task Force
The bill directs the Governor to establish a task force, to be
composed of executive branch appointee or staff, to coordinate
state investments in programs that reduce greenhouse gases,
conduct education and ensure that the state implements these
limits. Staff note it is not clear that the bill provides any
authority to the task force to accomplish these tasks. Costs to
establish and convene the task force could excess $100,000,
beginning in the budget year
The bill also directs state entities to implement strategies for
reducing greenhouse gas emissions. It is not clear that the
bill provides the agencies with the authority necessary to
implement these strategies. In the event entities implement the
strategies required by this provision, the bill could