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California Lawmakers to Make Clean Energy Push

In the opening weeks of the California state legislature, proposals have surfaced with a clean energy emphasis, promoting renewables and alternative transportation fuel use. One proposal also would seek to mandate that the state's two public employee retirement funds  divest interests in coal companies.

With the lawmakers holding a heavily Democratic Party majority, a major package of bills is being carved out to support Democratic Gov. Jerry Brown's climate change, carbon emission-lowering proposals laid out in his state-of-the-state address last month (see Daily GPI, Jan. 6).

Industry association representatives are skeptical about Brown's goals and now the legislature's proposals, although they are still in the discussion stages. The head of the Western States Petroleum Association (WSPA), Catherine Reheis-Boyd, questioned the practicality of cutting the state's use of petroleum in transportation down to 50% by 2030 when it stands at 92% today.

WSPA believes that mandates to cut conventional energy supplies will work against efforts to develop affordable alternatives. "[Gov. Brown's] long list of strategies will require engagement from industry, consumers and community stakeholders who might be impacted by such an ambitious solution," Reheis-Boyd said.

The head of the state Senate, Sen. Kevin de Leon, told the Los Angeles Times that concerns from the oil/natural gas industry "should be taken with a grain of salt.”

Under a bill being developed by De Leon and Sen. Mark Leno from San Francisco, a 50% target for petroleum use in transportation by 2030 could be achieved by switching to alternatives, more efficiency and less driving through expanded public transportation, they said. Similarly, the renewable portfolio target would be raised to 50% for 2030.

Major utilities in the state currently working to meet a renewable goal of 33% by 2020 are pushing back on the 50% target as a mandate, arguing that there should be more flexibility in the state's requirements.

Among the other early proposals by De Leon is a bill requiring the state's two largest pension funds -- California Public Employees Retirement System (CalPERS) and California State Teachers Retirement System -- to divest investments in coal companies, even though the funds' administrators have argued that their coal investments are relatively minute.

CalPERS pension officials told the LA Times that the coal investments amount to 0.06% of the funds $296.1 billion in investments. Pension officials have also told De Leon earlier that divestment would reduce the fund's ability to influence the marketplace in favor of clean investments.

De Leon said the issue is still up for more discussion. Similarly, in making his proposals, Brown acknowledged that removing significant amounts of carbon without harming the state's now-recovering economy won't be easy to do. Trying to balance economic and environmental benefits is "exactly the sort of challenge at which California excels," Brown said during his state-of-the-state message.

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