Emissions

The Polluters Pay Climate Superfund Act (SB 684/AB 1243)

Posted by CLR

In response to devastating wildfires in California in recent years, Sen. Caroline Menjivar (D–San Fernando Valley) and Asm. Dawn Addis (D–San Luis Obispo) have introduced a new bill that would create a program under California’s Environmental Protection Agency (CalEPA) to assess fees on the largest historical producers of climate-heating pollution. It would force these fossil fuel polluters to pay for their increasingly devastating and costly damage to the state—rather than leaving Californians to bear the financial burden.

This bill, known as the Polluters Pay Climate Superfund Act of 2025, SB 684 and AB 1243, establishes the Polluters Pay Climate Superfund Program, to be administered by CalEPA. The program requires fossil fuel companies to pay their fair share of the damage caused by greenhouse gas emissions released between 1990 and 2024, resulting from the extraction, production, refining, sale, or combustion of fossil fuels or petroleum products. The goal is to shift part of the financial burden of climate change response and adaptation away from taxpayers and onto the corporations most responsible.

Within 90 days of the law’s adoption, CalEPA must publish a list of responsible parties—defined as entities with a majority ownership interest in businesses that extracted or refined fossil fuels, conducted business in California, and are responsible for over 1 billion metric tons of global fossil fuel emissions during the covered period.

Using a climate cost study, CalEPA will calculate the total damages from climate impacts in California through 2045 and determine each responsible party’s proportionate share of the costs. These funds will be deposited into a newly created Polluters Pay Climate Superfund Fund, which will finance climate resilience, clean energy projects, disaster preparedness, green jobs, and infrastructure improvements—particularly benefiting disadvantaged communities.

Companies may pay in full or opt for a 20-year installment plan, with penalties for nonpayment. The law also allows for continued legal action against polluters and does not preempt existing environmental laws or regulations.

In short, this act is a bold step to make fossil fuel giants financially accountable for the climate crisis they helped create—and to fund California’s response and recovery in the decades to come.

Note: Citizens groups are planning to rally in support of the bill in Sacramento on April 2 for the bill’s first hearing at 9 a.m. in the Senate Environmental Quality Committee. Organizers have arranged for coffee, bagels, and t-shirts to be distributed, followed by the hearing and a group photo. For more details, location info, and updates, they encourage RSVPs.

IEMAC Opines that California is NOT on Target to Hit Emissions Goals

Posted by CLR

The IEMAC makes a number of recommendations in its 2023 annual report, covering greenhouse gas accounting, affordability, market links with other jurisdictions, and subsurface carbon management.

IEMAC’s recommendations are based on the backdrop that, while emissions are on a downward trend, California is not on track to hit its emission reduction targets in 2030.

First, IEMAC recommends adjustments to the methodology employed by CARB in accounting for emissions. It noted several methodological concerns. 

  • Among other things, IEMAC notes that CARB should reevaluate the calculation of biogenic CO₂ emissions as this could encourage certain mitigation measures notwithstanding controversy over whether biogenic CO₂ ought to be treated differently from fossil CO₂.
  • IEMAC recommends changes in the treatment of land sector emissions and removals, which are presently excluded from California’s GHG inventory, but in light of recent wildfire seasons comprise a significant source of CO₂. 
  • IEMAC recommends the adjustment of the 1990 statutory emissions baseline, since CARB recently shifted to using MRR data as the primary source for the GHG Inventory; this change was viewed as improving data accuracy but also had the effect of retrospectively lowering historical emission estimates. The IEMAC recommended that this change underscores the need to review and possibly adjust the 1990 baseline to maintain policy stringency.

Second, IEMAC addresses concerns about policy equity in the climate transition. 

  • IEMAC emphasize that vulnerable Californians bear the brunt of these climate impacts, and that the transition to a zero-emission economy must be both affordable and equitable, particularly benefiting disadvantaged communities. It notes that current approaches, such as raising electricity prices to fund wildfire mitigation, disproportionately affect low-income households.
  • It argues for a shift towards more cost-effective strategies, advocating for the role of California’s greenhouse gas (GHG) emissions market. It stresses the market’s flexibility in promoting least-cost abatement strategies compared to rigid regulations, potentially lowering overall mitigation costs. IEMAC also recommends tighter regulations and adjustments to allowance supply as part updates to the market.

Third, IEMAC encourages California to share its policies.  It argues that while California emits a small fraction of global greenhouse gases, its policies and technologies have a disproportionate impact due to their potential for replication and adoption beyond state borders.

  • It cites examples like California’s cap-and-trade system, which was linked early with Quebec’s through the Western Climate Initiative (WCI), demonstrating the potential for collaborative emission reductions across regions.
  • It advocates for expanding these linkages, particularly with Washington State’s recently passed Climate Commitment Act, which mirrors California’s. 
  • They argue that expansion actually improves efficiency by reducing administrative costs and stabilizing business costs across a larger market.

CARB’s California State Budget Item 3900-001-3237 Reporting

Posted by CLR

California State Budget Item 3900-001-3237 required CARB to publish annually for three years beginning in 2022 a preliminary estimate of the prior-year’s GHG emissions. CARB’s reporting is very oddly worded, and cautions in multiple places that it is posting only as required by statutory budget item and is not intended for decision making or regulatory compliance.

You can find those reports here: 2021, 2022, and 2023. They are also summarized below.

California Senate Hearings on Cap and Trade

Posted by CLR

On February 13, 2024, the Senate Environmental Quality joined the Senate Budget and Fiscal Review Subcommittee No. 2 on Resources, Environmental Protection and Energy, met to consider the new proposed “Cap and Trade Rulemaking” and to examine more closely why the state’s current cap-and-trade program is not on track to drive environmental justice and affordability outcomes by 2030. Staff produced a background paper to summarize the concerns. You can watch the hearing here.

May 16 EJAC Meeting to Consider CARB’s Regulatory Impact Assessment of New Regulations

Posted by CLR

AB 32 Environmental Justice Advisory Committee meet next on Thursday, May 16, 2024, at 1:00 PM – 5:00 pm. You can attend in person, on line, or by telephone. Details are here.

The meeting will focus on the economic impacts of the new cap and trade regulatory changes. The cost benefit analysis (Standardized Regulatory Impact Assessment or SRIA) was prepared pursuant to regulations adopted by the Department of Finance.

Table 1 from page 5 the SRIA sets out the costs and benefits predicted from the action, although it lumps them all together.

In total, it appears that the $79.4 – $82.8 billion costs of the program will be overshadowed by the $125.70 – $561.10 billion in benefits. Read the full report to understand the ranges, which are largely due to the differences in the proposed scenarios and the discount rate applied.

Open for Public Comment: 2023 Annual Report of the Independent Emissions Market Advisory Committee Open for Public Comment: 2023

Posted by CLR

The Independent Emissions Market Advisory Committee (IEMAC) is seeking public comment on its Sixth Annual Report to the California Air Resources Board (CARB) and the Joint Legislative Committee on Climate Change Policies on the environmental and economic performance of California’s carbon market
and other relevant climate policies.

Public comments should be sent to iemac@calepa.ca.gov by February 26.

Climate Transparency in California Is at Risk

Posted by CLR

The Climate Accountability Package — comprised of Senator Scott Wiener’s SB 253 and Senator Henry Stern’s SB 261 — created the nation’s first requirements for large corporations to publicly disclose their greenhouse gas emissions, carbon embedded in supply chains, and climate risks. The New York Times called SB 253 in particular a “landmark climate disclosure bill” […] with national repercussions.”  

The ink on these bills is barely dry and they are already under attack from multiple fronts.

Governor Newsom’s proposed budget included significant cuts to address a $37.9 billion budget shortfall, including all funding to new legislative programs.  Thus, the $9 million requested by the California Air Resources Control Board (CARB) to implement the Climate Accountability Package was part of that proposed cut.  The Newsom Administration has emphasized that the proposed budget was just a starting point for negotiations.  Senator Wiener, author of SB 253, has issued the following statement:  “It’s critical that the May budget include funding to implement these laws so that businesses have the certainty they need to prepare to make these new disclosures.”  Thus, funding to implement these laws is far from certain.

Although having the laws have the support of many major corporations, including  Apple, Google, Salesforce, Levi’s, and Patagonia, the California Chamber of Commerce was stanchly opposed. In fact, it file suit in federal district court to challenge the laws on January 30, 2024.  The petition, drafted by the firm multinational law firm Gibson, Dunn & Crutcher, LLP, raises claims largely rooted in the US constitution. 

  • The petition argues that the laws impermissibly “compels speech” under the First Amendment by making the corporations report on their direct and indirect emissions, which they argue are primarily speculation, as well as requiring them to report on the future risks from climate change.  Further, they complain that some of this reporting is on the company’s website.  Many of the complaints are based on “vagueness” in the law; since both laws require CARB to adopt regulations to implement them, these charges seem premature. 
  • The petition argues that federal law in the United States Constitution and in the Clean Air Act preempts any efforts to require companies to report their emissions related to activities inside and outside of California.   Implicit in this argument is that “reporting” on emissions is “regulation” on emissions.
  • The petition argues that the laws somehow attempt to regulate commerce extraterritorially, both interstate and foreign, which is—according to the petition—an “offense” to the commerce clause. 

All of these arguments are clearly aimed at the activist, conservative United States Supreme Court.

So far, the litigation has not been successful in the courts, but it is early days. In November 2024, US District Court for the Central District of California denied the plaintiff’s motion for summary judgement as premature, granting leave to refile after discovery.

Senator Wiener issued the following statement in response to the litigation:

“The U.S. Chamber of Commerce’s lawsuit against these groundbreaking climate laws is straight up climate denial,” said Senator Wiener. “Why is the Chamber of Commerce working so aggressively to block basic transparency for the public? We know the answer. It’s not because of the Chamber’s bogus arguments about cost and implementation, since it’s both inexpensive and easy for corporations to make these disclosures. It’s not because of the Chamber’s bizarre and frivolous First Amendment argument. Rather, the Chamber is taking this extremist legal action because many large corporations — particularly fossil fuel corporations and large banks — are absolutely terrified that if they have to tell the public how dramatically they’re fueling climate change, they’ll no longer be able to mislead the public and investors. The Chamber and large corporate polluters don’t want the public to know how much they’re strangling the planet with carbon emissions — that’s why they filed this baseless lawsuit.

“The climate crisis is a real and present threat to our planet and to businesses’ success. Investors and consumers have a right to know the details of how billion dollar companies are navigating the greatest challenge of our time, and many major corporations like Apple and Google are already making these disclosures and support these laws because they understand that need. While corporate lobby groups continue to wage an unhinged misinformation campaign against these laws, investors and consumers are being deprived of vital information to navigate our rapidly warming planet.”

See more from Senator Weiner on the need to fund these measures at Four questions for Scott Wiener.

CARB Reports Emissions Are Up

Posted by CLR

CARB recently released a preliminary greenhouse gas inventory reporting that the the state’s emissions increased  in 2021 and 2022 as compared with 2020.

Reporting by Scoping Plan sector in units of million metric tons of carbon dioxide equivalent (MMTCO2e), CARB revealed that emissions are on an upward trend:

Sector2020 GHG Inventory (MMTCO2e)Ratio of MRR Emissions (2021/2020)Estimated 2021 Emissions (MMTCO2e)Estimated 2022 Emissions (MMTCO2e)
Transportation1361.0913148148.8 ±13.3
Electric Power601.03456260.4 ±1
Industrial731.01867576.1 ±3.8
Residential & Commercial390.99983939.3 ±1
Agriculture32N/A3231.6 ±0.2
High GWP21N/A2120.9 ±0.3
Recycling & Waste  9N/A98.8 ±0.1
Total369 384386 ±17.7

This is of course bad news, since addressing climate change requires deep and swift emissions reductions and the trend is clearly inconsistent with state law, which requires carbon neutrality by 2045. (See Health & Saf. Code, § 38562.2, subd. (c).)

CARB’s disclaimer for this analysis sounds defensive.  It reports that these estimates are provided only because they are required by law and “should not be used for any policy making decisions or regulatory compliance, nor cited for any purpose.”  (Emphasis added.)

EJAC: Critical of Scoping Plan, Calling it Business as Usual

Posted by CLR

The EJAC meet several times during the preparation of the new scoping plan in 2021 and 2022, on June 3, August 3 and 26, September 22 and 27, October 12 and 15, November 9 and 16, December 1 and 14, 2021, and January 25, February 8 and 28, March 1, 10, and 30, April 25 and 26, May 23 and 24, June 27 and 28, July 25 and 26, August 22 and 23, September 1, 26, and 27, October 24 and 25, and November 29 and 30, 2022.

On September 30, 2022, the EJAC wrote a letter to CARB. EJAC was critical of the draft scoping plan, calling it “business as usual.” It argued that greater focus should be on direct emission reductions that covered all sources, rather than a plan that extends the life of fossil fuel and natural resource extraction. See details in the letter. You can also find CARB’s response here.

CARB’s Scoping Plans

Posted by CLR

The California Scoping Plan refers to a comprehensive strategy developed by the California Air Resources Board (CARB) to outline measures and actions aimed at reducing greenhouse gas emissions in the state. The plan is a key component of California’s commitment to addressing climate change and meeting its statutory targets for reducing emissions.

The 2008 Scoping Plan, which was actually finalized in 2009, was the first such plan. As required by statute, the Scoping Plan has been updated every five years by CARB since then.

The 2022 Scoping Plan can be found here: 2022 Scoping Plan for Achieving Carbon Neutrality

The 2017 Scoping Plan can be found here: California’s 2017 Climate Change Scoping Plan

The 2013 Scoping Plan can be found here: First Update to the Climate Change Scoping Plan: Building on the Framework Pursuant to AB 32: The California Global Warming Solutions Act of 2006

The 2008 Scoping Plan can be found here: Climate Change Scoping Plan: A Framework for Change Pursuant to AB 32 The California Global Warming Solutions Act of 2006