After a tumultuous year, California lawmakers sent several important energy and environment bills to the governor’s desk in the final hours of the legislative session.
Bills advanced by the Senate and Assembly aim to rework California’s climate spending, close an environmental review loophole and rein in electricity rates, among other efforts. All await signatures from Gov. Gavin Newsom this month.
One major item is Senate Bill 193, a last-minute effort to settle how California spends its Greenhouse Gas Reduction Fund under the state’s recently renewed cap-and-invest program. The fund is a primary source of money for climate projects in California, but a new three-tier payout system left some crucial programs last in line to receive money.
The bill passed Monday would instead guarantee about $921 million for those programs, including $230 million for transit projects, $70 million for forest health, $70 million for clean drinking water and $50 million for sustainable agriculture, along with other programs geared toward air quality, affordable housing and more.
Some senators hoped to phase out a controversial incentive that allows major polluters to apply for additional pollution credits if they invest in decarbonization projects — an incentive that is expected to reduce overall revenue to the Greenhouse Gas Reduction Fund. The California Air Resources Board approved that incentive earlier this year. Experts said the Legislature is likely to pick that issue back up next year.
But overall, this bill is “a win,” said Mary Creasman, chief executive of the nonprofit California Environmental Voters. “It’s really a signal of where the Legislature is — that they’re still committed to these programs, and that they’re committed to the GGRF being invested in these ways directly in communities.”
Also moving forward is SB 954 from Sen. Catherine Blakespear (D-Encinitas), which closes a loophole in last year’s sweeping reform of the California Environmental Quality Act that would have allowed for advanced manufacturing facilities — such as strip miners, chemical producers, battery recyclers and semiconductor plants — to be sited in communities without any environmental review.
Dozens of labor, environmental justice and conservation groups are now urging the governor to sign it into law, noting that it provides essential protections for communities that already experience the worst pollution from industrial facilities.
Other bills aim to address rising electricity rates in California. Among them is SB 905 from Sen. Josh Becker (D-Menlo Park), which seeks to lower costs for ratepayers by changing how investor-owned utilities such as Pacific Gas & Electric and Southern California Edison are regulated and paid.
The bill would require the California Public Utilities Commission to consider reducing those utilities’ returns on equity for lower-risk investments, such as undergrounding power lines. It would also require utilities to improve their use of existing grid capacity and be more transparent about unused capacity.
It’s a “no-regrets solution that will help the state make better use of the grid we have and put downward pressure on electricity costs,” said Brandon Garcia, California director at Advanced Energy United, a national energy industry association.
PG&E opposes the bill, saying that it does not really address affordability and will slow down electrification and interconnection work and make it more expensive.
“Until California adopts comprehensive wildfire reforms to provide long-term certainty for customers, wildfire victims and utilities, the Legislature should not advance policies that increase regulatory uncertainty and customer costs,” PG&E spokesperson Jennifer Robison said.
Robison could not yet comment on AB 2493, an amended bill from Assemblymember Cottie Petrie-Norris (D-Irvine), which would require utilities to speed up transmission upgrades when they are needed to connect clean energy projects to the grid. Garcia said the bill “holds utilities accountable for advancing these projects and makes sure California’s energy system can keep pace with the needs of our residents and our economy.”
Also moving forward are bills to improve access to small-scale solar for renters and condo-dwellers, and another to allow batteries, electric vehicles, smart thermostats and other consumer-owned devices to be bundled together and counted as a reliable source of electricity for the state’s grid.
Other items seek to help California defend itself from federal efforts to erode the state’s environmental authority. That includes giving the state more control over large coal projects — such as a new coal export terminal in Oakland announced by the Trump administration earlier this year — and making it harder for offshore oil producers to pass through state water or use existing pipelines.
Meanwhile, a Newsom-backed bill that would speed compensation to wildfire victims and reform the way wildfire claims are handled died in the Legislature on Tuesday. Its failure was largely seen as a win for the state’s three biggest for-profit utilities.
Newsom has until Sept. 30 to sign or veto bills passed in the final days of the legislative session.
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