California's "magic" Number: Nine Goals for 2020 and Where We May Go from There

• Publication year: 2014
• Author: by Ryan Waterman* and Parissa Ebrahimzadeh**

California's "Magic" Number: Nine Goals for 2020 and Where We May Go From There

by Ryan Waterman* and Parissa Ebrahimzadeh**

INTRODUCTION

Environmental lawyers are familiar with aspirational, technology-forcing goals set into law. The federal Clean Water Act amendments of 1972 called for the elimination of the "discharge of pollutants into the navigable waters" by 1985, and the federal Clean Air Act amendments of 1970 sought to set and achieve national ambient air quality standards by 1975.¹ While neither law achieved its ambitious goals, they set our nation firmly on a course toward cleaner water and air.

California is no stranger to legislating aspirational goals tied to future dates. Most recently, it seems to have found some magic in the year 2020, which is the state's target for achieving an unusually large number of cutting-edge, nation-leading goals, ranging from significant reductions in greenhouse gas (GHG) emissions and trash diversion from landfills, to urban water use reductions and the use of e-books in college classrooms.

This article explores nine goals California hopes to achieve by 2020, briefly describing each goal and considering two questions: (1) how likely is it that the state will achieve its goal, and (2) what might come next?

CALIFORNIA DREAMING: NINE GOALS FOR 2020

California is the nation's most populous state, with a population of 38 million (approximately 12% of the nation's population), which is expected to increase to approximately 43 to 46 million (approximately 14% of the nation) by 2020.² With size comes complexity, but that has not deterred California from pushing the environmental envelope, and adopting innovative approaches and ambitious goals. Rather, its size and audacity attracts the nation's attention, and often drives national policy.

What is California doing today that will shape what it will look like in 2020? The state has set the following nine goals aimed at substantively transforming California by 2020.

A. AB 32: Reduce GHG Emissions to 1990 Levels

The California Global Warming Solutions Act of 2006 (otherwise known as AB 32) requires California to return to 1990 levels of GHG emissions by 2020.³ Meeting AB 32's target will mean emitting even fewer GHGs per capita than the state did in 1990, because the state's population will have grown by approximately 48% from 1990 to 2020, from 29.7 million to approximately 44.1 million residents.⁴ The California Air Resources Board (ARB) has responsibility for implementing AB 32.⁵ AB 32 establishes a nation-leading comprehensive program of regulatory and market mechanisms, including a cap and trade program, to achieve real, quantifiable, cost-effective reductions of GHGs. The cap and trade program sets declining annual limits on sources responsible for 85% of California's GHG emissions, which are intended to drive long-term investment toward cleaner fuels and more efficient use of energy.⁶

Outlook for Success: Likely. ARB's Scoping Plan to implement AB 32 and the cap and trade program continues to survive legal challenges, from allegations of CEQA deficiencies in the adoption of the AB 32 Scoping Plan in 2008 (subsequently corrected without endangering any AB 32 programs),⁷ to challenges to the constitutionality of the cap and trade program, which were recently rejected by the Sacramento Superior Court.⁸ ARB also prevailed in a challenge to the offset credit provisions of the cap and trade regulations in Citizens Climate Lobby v. ARB, which currently is pending on appeal before the First District Court of Appeal.⁹

Barring legal derailment, Mary Nichols, ARB's Chairman, says, "We are clearly on track to reach our 2020 goals and we are ahead of schedule. We are not declaring victory yet, but we are on a good trajectory."¹⁰ Given that trajectory, Chairman Nichols says that "AB 32 very clearly does not end in 2020. The 2013 Scoping Plan, currently out in draft form, includes a discussion on post-2020 actions. The state is responsible to do everything feasible to continue reduction of GHGs."¹¹

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Looking past 2020: Look for progress toward further GHG reductions, tied to a date (or dates) between 2020 and 2050 (with 2050 as an outside date because that is the date identified in former Governor Schwarzenegger's Executive Order S-3-05, which calls for an 80% reduction in GHG emissions from 1990 levels by 2050).¹² In fact, ARB recently released its "Proposed First Update to the Climate Change Scoping Plan" (Scoping Plan Update), which focuses on the 2050 goal of reducing GHG emissions to 80% below 1990 levels by 2050, and calls for a "mid-term" target in between 2020 and 2050.¹³ Notably, the Scoping Plan Update calculates that [e]missions from 2020 to 2050 will have to decline at more than twice the rate of that which is needed to reach the 2020 statewide emissions limit" in order to achieve the 2050 goal.¹⁴

B. Reduce Carbon Intensity of Transportation Fuels by 10%

The Low Carbon Fuel Standard (LCFS) seeks to reduce the carbon intensity (CI) of California's transportation fuels by at least 10% by 2020.¹⁵ CI is defined as "the amount of lifecycle greenhouse gas emissions, per unit of energy of fuel delivered, expressed in grams of carbon dioxide per megajoule."¹⁶ The goal of the LCFS is to reduce the state's total GHG emissions from transportation fuels by diversifying the sources of those fuels to include a greater proportion of less carbon-intensive fuels.

To achieve the goal of diversifying fuel sources, the LCFS encourages investment in low-carbon ethanol, biodiesel, renewable diesel and biogas, along with natural gas and alternative vehicle technologies. The LCFS focuses on reducing GHG emissions associated with the complete lifecycle of transportation fuels used in California.¹⁷ The lifecycle of a fuel includes the emissions associated with producing, transporting, distributing, and using the fuel. The LCFS program requires each regulated party to ensure that the overall CI score for its fuel pool meets the annual CI target for a given year.¹⁸ Reductions in excess of that required for one type of fuel (e.g., diesel) can be used to offset insufficient reductions in another fuel (e.g., gasoline).¹⁹

Outlook for Success: Too early to tell. The market may not produce enough biofuel with lower CIs to fulfill demand. Also, outstanding legal issues remain. Like AB 32, the LCFS has survived several legal challenges, at least so far. In Rocky Mountain Farmers Union v. Corey, the Ninth Circuit reversed a district court order that had found the LCFS violated the dormant commerce clause of the U.S. Constitution, and remanded the case back to the district court for further proceedings.²⁰ Although the Ninth Circuit rejected the Rocky Mountain plaintiffs' request for rehearing en banc, plaintiffs have petitioned the United States Supreme Court for certiorari. And in Poet, LLC v. California Air Resources Board, the Fifth Appellate District ruled that, despite legal errors, such as failing to respond to numerous public comments and omitting documents from the rulemaking file, the state was permitted to proceed with implementation of the LCFS.²¹

ARB believes the LCFS is on track, barring future legal roadblocks. Dave Clegern, Public Information Officer at ARB, says, "We are well on the way to reaching the 10% carbon reduction goal by 2020. LCFS is currently working as designed."²² Clegern adds, "We are seeing a broadening choice of fuel pathways for Californians. Where initially there were 25-30 approved pathways, now there are over 130 available pathways."²³ "Fuel pathway" is a term used to provide a detailed, quantitative description of a fuel production process that sums all GHG emissions from the entire fuel life cycle, with the pathway's CI being its lifecycle (or "well-to-wheels") GHG emissions total. Each supply chain category from source to product is considered a fuel pathway with inherent characteristics of CI and GHG.

Looking past 2020: Continuation of the LCFS program post-2020 will hinge on the effect its implementation has on both the fuel market and regulated parties in California and on ARB's success at rebuffing legal challenges. It remains to be seen whether the mandate to use lower CI biofuels will be extended, or whether a self-sustaining biofuels market will be developed.

C. 33% Renewable Portfolio Standard

California's Renewable Portfolio Standard (RPS) requires that by 2013, 20% of electricity sold by the state's investor-owned utilities (IOUs) be from renewable sources (solar, wind, etc.), with follow-on goals of 25% by 2016, and 33% by 2020—establishing the highest RPS goal in the nation.²⁴ Furthermore, AB 327 makes clear that the 33% goal is a floor, not a ceiling, leaving open the possibility that the state's IOUs could achieve a RPS greater than 33%.²⁵

The RPS standard is highly ambitious. The magnitude of the infrastructure build-out alone required to reach the RPS is daunting. Initially, the CPUC estimated that reaching these goals would require seven new major transmission lines to transmit approximately 15,900 megawatts (MW) at a cost of $6.4 billion.²⁶ In addition, developing RPS-qualified generation posed significant development challenges, including but not limited to site control, permitting, and developer inexperience. Implementation would also require resolution of complex issues throughout the systems for power generation and transmission, including (1) transmission grid reliability and integration; (2) the increasing cost of renewable generation; and (3) a paradigm shift in procurement and transmission planning. Achieving the 33% RPS could be accomplished only with careful transmission and resource planning.²⁷

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Outlook for Success: Likely. Despite these challenges, the CPUC reports that "California is on track to meet its interim requirement of 25% renewables by 2016, and is well-positioned to meet 33% by 2020."²⁸ Office of Planning and Research Director Ken Alex notes that, due to the addition of so many...