The end of this month marks 10 years since the California Legislature passed AB 32 (Nuñez/Pavley), the Global Warming Solutions Act of 2006. This landmark, first-in-the-nation law was signed in September 2006 by Governor Arnold Schwarzenegger and mandated a statewide reduction in heat-trapping pollution to 1990 levels by 2020. That was close to a 25 percent reduction compared to projected “business as usual” emissions at the time. So it was a very ambitious lift.
This pioneering target was considered especially daunting for the nation’s most populous state with its very large, complex, car-dependent economy, a state that was already considered a leader in clean, efficient energy use. How could such a big state that was already “cleaner” than most of the rest of the country achieve such ambitious targets without starving its economy? That was the fundamental question back in 2006.
The numbers then and now
A decade later seems like a good time to look back at where we were then and where we are now, and to provide some insight into how a state with a nation-sized economy—recently ranked the 6th largest in the world—is managing at the same time it is supposed to be reducing climate pollution.
Fundamentally, California’s experience is a robust test case on whether it is possible to have a healthy economy while systematically and significantly lowering emissions from dirty fossil fuels (oil, natural gas, and coal).
Here are some California statistics for comparison between 2006, when AB 32 passed, and today:
GROSS DOMESTIC PRODUCT
Then: $2.19 trillion (2006)
Now: $2.46 trillion (2015)
Change: + 12.4%
Source: U.S. Bureau of Economic Analysis. Annual Gross Domestic Product (GDP) By State. (Note: 2015 GDP is in 2015 dollars. 2006 GDP was derived by converting real GDP in chained 2009 dollars to 2015 dollars based on the ratio of 2015 current-dollar GDP to 2009 chained-dollar GDP.)
Then: 36.46 million (2006)
Now: 39.14 million (2015)
Change: + 7.4%
Then: 330 million barrels crude oil (2006)
Now: 282 million barrels crude oil (2014)
Change: – 14.3%
Energy Information Administration. 2015. State energy data systems (SEDS): 1960-2014. Table CT2: Primary energy consumption estimates, 1960-2014, California.
GLOBAL WARMING EMISSIONS
Then: 476.5 million tons CO2e* (2006)
Now: 441.5 million tons CO2e (2014)
(Target: 431 million tons CO2e by 2020)
Change: – 7.3%
* CO2e = carbon dioxide equivalent
Source: California Air Resources Board. California Greenhouse Gas Emission Inventory.
Then: 16,744,724 (May 2006)
Now: 18,081,724 (May 2016)
Change: + 7.8%
Source: Bureau of Labor Statistics
Then: 263,000 GWh** (2006)
Now: 259,000 GWh (2015)
Change: – 1.5%
Source: U.S. Energy Information Administration. Electric Utility Sales and Revenue–EIA-826 detailed data file.
** GWh = gigawatt hours
What these numbers show
These numbers show that not only is California on track to meet its emissions reduction goals, but that it is doing so when its overall economy is growing at a healthy pace—especially since the figures include the period of 2008-2011 when California, like the US and much of the world, experienced a severe economic contraction due to the mortgage debt crisis.
More recently, California has been growing faster than the rest of the country, and tied Oregon for the state with #1 growth rate in 2015. The numbers show that job growth is keeping pace with population growth at the same time that California is reducing electricity consumption while dramatically lowering oil consumption.
I can’t claim to be an objective bystander to all of this, as I staffed AB 32 for author Fran Pavley (then Assembly Member, now State Senator), and it took our office along with Assembly Speaker Fabian Nuñez and many supporters two years of hard work and plenty of knocks to get it passed. For those of us who were in the trenches back in 2006, the results are gratifying and speak for themselves—we have achieved a significant milestone. But this is not how some folks predicted it would work out.
Doom predicted, boom resulted
In 2006 a group of fossil fuel and big business interests formed a group they called Sustainable Economy and Environment California (SEECalifornia) that launched an aggressive lobbying and PR campaign to oppose AB 32. Citing an economic study they paid for to predict economic catastrophe for California if AB 32 were enacted, SEECalifornia published an advertisement in the Sacramento Bee in June 2006 entitled “Truth and Consequences of Assembly Bill 32,” in which they predicted “painful consequences” including job losses, reduced investment, and energy rationing among other things.
“There’s no way to get to the targets except by stopping the use of energy,” said a manufacturer’s association representative in a Los Angeles Times report from June 2006. The same article quoted economist Margo Thorning who wrote SEECalifornia’s report: “It (AB 32) really would practically shut the state down.”
Of course, that’s not at all what happened. But the truth has never stopped the oil industry and its allies from trying to deceive the public about climate change. So it’s no surprise that 10 years later a similar group of special interests is opposing a new bill, SB 32 (Pavley), which would extend and strengthen AB 32’s low-carbon targets, using similar arguments threatening economic doom. If anything, their rhetoric has become even more over-heated and dishonest, particularly on the part of the oil industry, as I wrote about last year when California was debating another landmark bill to dramatically increase clean energy and efficiency and reduce oil consumption by half.
This year we have already seen a torrent of lobbying and enormous campaign contributions from fossil fuel interests to elected legislators and candidates intended to have a chilling effect on efforts to go further with SB 32 this year. But experience is on our side, if people are willing to look at the facts. I will be writing in coming weeks on how and why we got to where we are over the last 10 years and the compelling need to go much further.
For now, the bottom line is that an aggressive economy-wide reduction in global warming pollution is taking place at the same time that California is showing impressive—some say “booming”—economic growth. In a season of seemingly relentless bad news—civil violence, fires and floods, political craziness, zika virus—this is especially good news. But this information is rarely discussed in the media, since it’s been a slow-moving evolution rather than a singular, dramatic event.
AB32’s success is a story encompassing many developments working together over time, and it is hard to describe as a single solution. But it is important that people know about California’s effective climate policies because they set a vital example for the rest of the country and much of the world. AB 32, 10 years later, also demonstrates to Californians that we can prosper and grow while we go further to accomplish real—and urgently needed—reductions in the pollution causing global warming.