ETAAC Discussion Draft 12-21-07

ETAAC Report Discussion Draft – Released 12/21/07 Greetings! This document is a discussion draft report that includes proposals made to the Economic and Technology Advancement Advisory Committee (ETAAC) by ETAAC members or members of the public. Consideration by ETAAC does not represent an ETAAC endorsement. This discussion draft report is intended to provide a basis for public comment and for discussion by ETAAC at its next meeting, currently scheduled for January 25, 2008 at the Cal/EPA Headquarters Building in Sacramento. Written public comments should be submitted via email to [email protected] or by surface mail to Steve Church Research Division California Air Resources Board 1001 I Street, PO Box 2815 Sacramento, CA 95812 Written public comments should be received no later than close of business on January 18, 2008 to ensure they will be available to the Committee at the January 25, 2008 ETAAC meeting. Further information on ETAAC, including meeting times, locations and agendas, can be found at http://www.arb.ca.gov/cc/etaac/etaac.htm ETAAC Report Discussion Draft – 12/21/07 Table of Contents 1. INTRODUCTION I. The Challenge Facing California p1-1 II. Major Strategies and Opportunities p1-2 III. Summary Message p 1-8 IV. The Role of ETAAC p 1-10 V. General Principles p 1-12 VI. Organization of ETAAC report p 1-16 2. FINANCIAL SECTOR I. Introduction p2-1 II. Central Recommendations: Carbon Trust & Cleantech Commercialization p 2-3 III. Additional Organizational and Policy Recommendations p 2-14 3. TRANSPORTATION SECTOR I. Introduction p3-1 II. General Policy Recommendations for the Transportation Sector p3-6 III. Shifting Demand for Mobility and Goods Movement p3-11 IV. Improving Vehicle GHG Performance p3-21 V. Low-Carbon Fuels p3-29 VI. International GHG Emission Sources, p3-32 4. INDUSTRIAL, COMMERCIAL & RESIDENTIAL ENERGY USE I. Introduction p4-1 II. Industrial Technologies and Policies p4-3 III. End User Energy Efficiency p4-9 IV. Waste reduction, Recycling and Resource Management p4-13 5. ELECTRICITY AND NATURAL GAS SECTORS I. Introduction p5-1 ETAAC Report Discussion Draft – 12/21/07 II. Utility-Level Programs to Accelerate Energy Efficiency p5-4 III. Expanding California's Successful Renewable Energy Programs p5-6 IV. Enabling Technologies for Zero Emission Electricity and Vehicles p5-12 V. Carbon Capture and Storage and Unifying Program Standards p5-18 VI. Suggested Legislative and Regulatory “To Do” List p5-22 6. AGRICULTURAL SECTOR I. Introduction p6-1 II. An Agricultural Global Warming Solutions Program p6-3 7. FORESTRY SECTOR I. Introduction p7-1 II. The Policy Context p7-2 III. Key Policy Principles p7-3 IV. Key Overriding Themes p7-4 8. ETAAC REVIEW OF MARKET ADVISORY COMMITTEE REPORT I. Introduction p8-1 9. APPENDICES Appendix I: ETAAC Member Biographies p9-2 Appendix II: ETAAC Committee Schedule p9-8 Appendix III: Inventory of Current State Funding Programs related to Climate Change p9-9 Appendix IV: Background Status Report on Energy Technologies p9-29 Appendix V: Background Status Report on Transportation Sector Solutions and Sources p9-75 Appendix VI: Summary of Public Responses to Request for Climate Change Emission Control Technologies p9-101 ETAAC Report Discussion Draft – 12/21/07 1. INTRODUCTION AND REPORT SUMMARY I. The Challenge and The Opportunity Global climate change presents California with serious challenges to the health of its ecosystems and the vitality of its economy. Recognizing this threat, the California Legislature and Governor Schwarzenegger approved AB 32, the California Global Warming Solutions Act of 2006. AB 32 requires that the state cut greenhouse gas (GHG) emissions such as carbon dioxide (CO 2) by 25 percent by 2020. This reduction target is calculated on a 1990 baseline of GHG emission levels and is measured against assumed business as usual California Per Capita GHG (tons per person) economic activity. 25.00 23.40 Previous to the passage of AB 32, Governor 20.00 Schwarzenegger issued a 2005 Executive Order that 14.62 set an even more ambitious climate change 15.00 13.82 response program: an 80 percent GHG emission 9.88 reduction by 2050. Other nations and states are now 10.00 adopting this aggressive reduction target in light of recent scientific findings that suggest the world may 5.00 soon be reaching a tipping point on climate change 1.47 impacts. Given California’s expected population 0.00 1990 2006 2020 2050 US - growth, this 2050 reduction target creates great 2003 challenges for the state, as it requires a 90 percent GHG reduction per capita. The target calls for vastly more efficient use of energy and the virtual elimination of all GHG emissions from the fuels and technologies that comprise the state’s energy infrastructure. Despite these seemingly daunting challenges, California’s climate change policies also offer monumental opportunities that can benefit the state’s economy, environment, and the public health of its citizens. Developing cleaner energy and transportation systems will give California the chance to improve the security of fuel supplies, address stubborn air pollution concerns, and to develop better designed urban centers. Better methods of moving people and goods throughout the state are another golden opportunity that flows from climate change response programs. In many cases, these solutions provide important co-benefits by addressing difficult and long- standing problems. Among them is the inequitable distribution of the environmental costs associated with power and transportation infrastructure. Continuing California’s long-standing tradition of eco-innovation, AB 32 has thrust the California Air Resources Board (CARB) into a leadership role on forging new approaches to diminishing the state’s carbon footprint. Significant progress has already been made in the state in cutting major sources of air pollution. For example, California’s power plants now emit less than 90 percent of the fine particulates and ozone-forming nitrogen oxides than they did two decades ago. California’s greenest new passenger cars emit 99 percent less Volatile Organic Compounds (VOC) and Nitrogen Oxides (NOx) than in 1970. High energy prices, a transition towards a service-oriented economy, and polices supporting aggressive energy efficiency 1-1 ETAAC Report Discussion Draft – 12/21/07 upgrades, have all helped California keep its per capita electricity consumption flat for the past few decades. California has achieved this feat, in part, through a balanced portfolio of policies, performance standards and market-based incentives. These state policies addressed important market failures: pollution externalities; market barriers to private sector Research, Development & Demonstration (RD&D); misplaced financial incentives, and imperfect information for energy consumers. As California turns its attention to combating global climate change, new state policies designed to surmount these and other market failures must expand in scope and creativity. The initial AB 32 target of reducing California’s GHG emissions back to 1990 levels by 2020 is only the first step. The long-term reduction goals for 2050 and beyond are equally important and will require fundamental changes in consumer behavior, energy use and in the infrastructure that supports virtually all economic activity. The state will inevitably encounter tradeoffs between the actions necessary to bring about the wide scale transformation of a carbon-free economy and those that may bring about the lowest cost emissions reductions in the short term. Both near- and long-term goals are critical. Only balanced and innovative approaches will serve California’s strategy to phase-in new zero carbon products and services. A chief challenge is to simultaneously address socio-economic challenges that accompany the price signals necessary to develop a more sustainable energy economy. II. Major Strategies and Opportunities AB 32 instructs CARB to create the Economic and Technology Advancement Advisory Committee (ETAAC). The legislation notes that ETAAC is charged to do the following: “Advise on activities that will facilitate investment in and implementation of technological research and development opportunities including, but not limited to, identifying new technologies, research, demonstration projects, funding opportunities, developing state, national, and international partnerships and technology transfer opportunities, and identifying and assessing research and advanced technology investment and incentive opportunities that will assist in the reduction of greenhouse gas emissions. The committee may also advise the CARB on state, regional, national, and international economic and technological developments related to greenhouse gas emission reductions." In this report, ETAAC has identified five major strategies that support five major categories of opportunities to advance cost effective GHG emission reduction technologies. A general description of each of these strategies follows. A map of how each recommendation in the report reflects these major themes is included in a chart at the end of this introductory chapter. Strategy #1: Accelerate GHG Emission Reductions AB 32 establishes a fixed timeframe for California to achieve a 25 percent reduction in GHG emissions. This year 2020 timeframe is useful because it provides business and the rest of the state specific targets for long-term planning. However, the competing interests of many different stakeholders -- including industry, labor, environmentalists, land owners,

Load more