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September 01, 2016   |   Diesel Technology Forum

Policy Insider

Rebalancing the Climate Change Checkbook for all Californians

A new CA program may help get the latest fuel sipping and clean technology into service quickly, to rejuvenate the truck fleet and generate clean air benefits for those communities most in need.

As California adopts a new climate target, it looks as if a late night deal on one of the biggest policy levers to reduce greenhouse gas emissions and improve air quality for all Californians is at hand. While the announcement was made last night between the Governor and legislative leaders, the devil will be in the details. We will wait and see how the plan rolls out to address climate and clean air concerns in all communities.

Just last week, the California legislature approved SB 32 that extends the state’s already ambitious greenhouse gas (GHG) reduction goals to 2030. In less than 15 years, California will emit 40 percent less GHG emissions than it did in 1990. The deal did not reauthorize one of the major policy levers to achieve GHG reduction - California’s carbon cap-and-trade program. That problem was rectified in the evening of August 30th as the Governor and legislative leaders unveiled a late-night deal that tweaks the cap-and-trade program to address both climate and air quality concerns.

Righting a Past Wrong

According to the California Air Resources Board, transportation represents the largest source of GHG emissions in the state. About 70 percent of transportation emissions are related to passenger vehicles and about 30 percent are attributable to commercial vehicles. When it comes to addressing GHG emission reduction, California responded by focusing almost exclusively on passenger vehicles. By using revenue generated under its cap-and-trade auction scheme, along with some funding from a few other sources, the Air Resources Board and the Energy Commission provide generous incentives for the purchase of electric passenger vehicles. Very few funds have flowed to commercial vehicles and those that are available flow to technology demonstration projects and niche fuels rarely used in widespread applications.

The real loser in this policy that has excluded commercial vehicles are residents in disadvantaged communities. According to CalEnviroScreen, many disadvantaged communities are correlated with truck routes. Very few passenger vehicle incentives flow to these communities as well.  California is also home to the second oldest commercial vehicle fleet in the nation. Eighty-two percent of trucks in operation in the state do not come with the latest technology that reduces emissions to near-zero levels while also improving fuel economy and reducing the CO2 footprint.

Rejuvenating the commercial vehicle fleet in California will have a direct effect on reducing greenhouse gas emissions for the state and improving air quality for the residents most in need of cleaner air, particularly those communities located near truck routes. Already, we are more than two years into the first ever fuel economy and GHG reduction requirement for commercial vehicles that will reduce emissions nationwide by 270 million tons. Just this month, the Environmental Protection Agency issued a second rule extending this program to 2027 at which time GHG emissions are expected to fall by 1.1 billion tons. These significant GHG reductions will come by way of the latest clean diesel technology that already reduce particle and smog forming emissions to near-zero levels. Yet California is a very slow adopter of these technologies and it will be some time before these advance technologies are introduced in the state and those communities most in need.

A New Deal for a New Day

Thankfully, the deal just announced on August 30th may help rebalance California’s greenhouse gas emissions reduction policy. The agreement just signed by the Governor, the Assembly speaker and leader of the Senate allocated $368 million in cap-and-trade revenue for the remaining year and into next to continue programs to reduce transportation related GHG emissions. Forty percent, or $150 million, will be devoted to projects relating to heavy-duty vehicles and equipment. Let’s hope that the program, when implemented, can get the latest fuel sipping and clean technology into service quickly, to rejuvenate the truck fleet and generate clean air benefits for those communities most in need.


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Ezra Finkin
Director, Policy

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