California Senate Bill SB1114 Introduced / Bill

 BILL NUMBER: SB 1114INTRODUCED BILL TEXT INTRODUCED BY Senator Florez FEBRUARY 17, 2010 An act to amend Section 44281 of, and to add Section 40708.5 to, the Health and Safety Code, relating to air pollution. LEGISLATIVE COUNSEL'S DIGEST SB 1114, as introduced, Florez. Emission reduction credits: private and public moneys. Existing law prohibits the creation of an emission reduction credit from air pollution reductions funded by certain public programs. Existing law creates air quality management districts and air pollution control districts and requires these districts, except as otherwise provided, to establish a system by which all reductions in the emission of air contaminants that are to be used to offset certain future increases in the emission of air contaminants are to be banked prior to use to offset future increases in emissions. This bill would authorize a district to create an emission reduction credit from a marine vessel or locomotive emission reduction project that is funded by both public and private moneys. An emission reduction credit created pursuant to this provision would be created only for the percentage of the emission reduction project that is paid for by private moneys. The bill would provide that the state share of the credit would be 80%, and the Treasurer would be required to sell this ownership share, and deposit the proceeds into the Emission Reduction Credit Sales Fund, which the bill would create. Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no. THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS: SECTION 1. Section 40708.5 is added to the Health and Safety Code, to read: 40708.5. (a) A district may authorize the creation of an emission reduction credit from a marine vessel or locomotive emission reduction project, including an emission capture project, that is funded by both public and private moneys. (b) An emission reduction credit shall be created pursuant to subdivision (a) only for the percentage of the emission reduction project that is paid for by private moneys. The emission reduction credit created from the portion of the project paid for by private moneys shall be divided between the person or persons who contributed the private moneys and the state. The state shall receive 20 percent of the credit and the private contributor or contributors shall receive 80 percent of the credit. (c) The Treasurer shall sell the state's ownership interests in the credits created pursuant to this section. The Treasurer shall deposit the proceeds from these sales into the Emission Reduction Credit Sales Fund, which is hereby created in the State Treasury. The moneys in the Emission Reduction Credit Sales Fund shall be available, upon appropriation by the Legislature. (d) This section shall be implemented in a manner consistent with the federal Clean Air Act (42 U.S.C. Sec. 4901 et seq.). SEC. 2. Section 44281 of the Health and Safety Code, as amended by Section 7 of Chapter 707 of the Statutes of 2004, is amended to read: 44281. (a) Eligible projects include, but are not limited to, any of the following: (1) Purchase of new very low or zero-emission covered vehicles or covered heavy-duty engines. (2) Emission-reducing retrofit of covered engines, or replacement of old engines powering covered sources with newer engines certified to more stringent emissions standards than the engine being replaced, or with electric motors or drives. (3) Purchase and use of emission-reducing add-on equipment that has been verified by the state board for covered vehicles. (4) Development and demonstration of practical, low-emission retrofit technologies, repower options, and advanced technologies for covered engines and vehicles with very low emissions of oxides of nitrogen. (5) Light- and medium-duty vehicle projects in compliance with guidelines adopted by the state board pursuant to Title 13 of the California Code of Regulations. (b)  No   A  project shall  not  be funded under this chapter after the compliance date required by any local, state, or federal statute, rule, regulation, memoranda of agreement or understanding, or other legally binding document, except that an otherwise qualified project may be funded even if the State Implementation Plan assumes that the change in equipment, vehicles, or operations will occur, if the change is not required by the compliance date of a statute, regulation, or other legally binding document in effect as of the date the grant is awarded.  No   Except as provided in Section 40708.5, a  project funded by the program shall  not  be used for credit under any state or federal emissions averaging, banking, or trading program.  No   Except as provided in Section 40708.5, an  emission reduction generated by the program shall  not  be used as marketable emission reduction credits or to offset any emission reduction obligation of any person or entity.  Projects   Except as provided in Section 40708.5, projects  involving new engines that would otherwise generate marketable credits under state or federal averaging, banking, and trading programs shall include transfer of credits to the engine end user and retirement of those credits toward reducing air emissions in order to qualify for funding under the program. A purchase of a low-emission vehicle or of equipment pursuant to a corporate or a controlling board's policy, but not otherwise required by law, shall generate surplus emissions reductions and may be funded by the program. (c) The program may also provide funding toward installation of fueling or electrification infrastructure as provided in Section 44284. (d) Eligible applicants may be any individual, company, or public agency that owns one or more covered vehicles that operate primarily within California or otherwise contribute substantially to the NOx, PM  ,  or ROG emissions inventory in California. (e) It is the intent of the Legislature that all emission reductions generated by this chapter shall contribute to public health by reducing, for the life of the vehicle being funded, the total amount of emissions in California. (f) This section shall remain in effect only until January 1, 2015, and as of that date is repealed, unless a later enacted statute, that is enacted before January 1, 2015, deletes or extends that date. SEC. 3. Section 44281 of the Health and Safety Code, as added by Section 7.5 of Chapter 707 of the Statutes of 2004, is amended to read: 44281. (a) Eligible projects are any of the following: (1) Purchase of new very low or zero-emission covered vehicles or covered engines. (2) Emission-reducing retrofit of covered engines, or replacement of old engines powering covered sources with newer engines certified to more stringent emissions standards than the engine being replaced, or with electric motors or drives. (3) Purchase and use of emission-reducing add-on equipment for covered vehicles. (4) Development and demonstration of practical, low-emission retrofit technologies, repower options, and advanced technologies for covered engines and vehicles with very low emissions of oxides of nitrogen. (b)  No   A    new purchase, retrofit, repower, or add-on equipment shall  not  be funded under this chapter if it is required by any local, state, or federal statute, rule, regulation, memoranda of agreement or understanding, or other legally binding document, except that an otherwise qualified project may be funded even if the State Implementation Plan assumes that the change in equipment, vehicles, or operations will occur, if the change is not required by a statute, regulation, or other legally binding document in effect as of the date the grant is awarded.  No   Except as provided in Section 40708.5, a  project funded by the program shall  not  be used for credit under any state or federal emissions averaging, banking, or trading program.  No   Except as provided in Section 40708.5, an  emission reduction generated by the program shall  not  be used as marketable emission reduction credits or to offset any emission reduction obligation of any entity.  Projects   Except as provided in Section 40708.5, projects  involving new engines that would otherwise generate marketable credits under state or federal averaging, banking, and trading programs shall include transfer of credits to the engine end user and retirement of those credits toward reducing air emissions in order to qualify for funding under the program. A purchase of a low-emission vehicle or of equipment pursuant to a corporate or a controlling board's policy, but not otherwise required by law, shall generate surplus emissions reductions and may be funded by the program. (c) The program may also provide funding toward installation of fueling or electrification infrastructure as provided in Section 44284. (d) Eligible applicants may be any individual, company, or public agency that owns one or more covered vehicles that operate primarily within California or otherwise contribute substantially to the NOx emissions inventory in California. (e) It is the intent of the Legislature that all emission reductions generated by this chapter shall contribute to public health by reducing, for the life of the vehicle being funded, the total amount of emissions in California. (f) This section shall become operative on January 1, 2015.