BDC�California Policy Call�(For Decarbonizers and Trailblazers)

September 20, 2022

MEMBERS

Agenda

• Proceedings
• Budget
• Legislature

Rulemaking on Building �Decarbonization

• Scope
• A rulemaking to establish a building decarbonization policy framework (more info here).�
• Update
• The PUC voted 5-0 at the latest business meeting to pass the Decision in Phase 3 to eliminate gas line extension allowances, refunds and discounts for ALL customer classes starting �July 1, 2023�

​

State Implementation Plan

• Scope
• CARB is collaborating with local air districts on development of regional SIPs to comply with the Clean Air Act and soliciting stakeholder input on the development of the 2022 State SIP Strategy.�
• Update
• Last week, CARB released their proposed plan, which includes:
• Beginning in 2030, 100% of sales of new space and water heaters (for either new construction or equipment replacement of burned-out equipment in existing buildings) would need to meet zero-emission standards.

​

• Timeline
• September 22: Workshop to Consider Adoption
• If the SIP passes as is, CARB staff proposes to commit to engage in a public process and bring an item to the Board by 2025.

AQMD Appliance NOx Standards

• Scope
• Bay Area and South Coast Air Quality Management Districts are investigating the role that ultra-low or zero-NOx appliance standards can play in helping them achieve their Clean Air Act requirements�
• Update
• South Coast AQMD released their updated �Air Quality Management Plan draft, which maintained the same building control measures �(see next slide).�
• Update
• Final AQMP released in October
• Board vote in December

AQMD Appliance NOx Standards

• Proposed building control measures:
• Residential & commercial water heating / space heating: rule for zero emissions and allow low-NOx as transitional alternative when installing a zero emission unit is determined infeasible + incentives
• Residential + commercial cooking: 1) technology assessment of emissions testing of various cooking devices to establish emissions rates, 2) rule development and incentive programs
• Proposed Dates:
• Residential rules: adoption in 2024, implementation in 2029
• Commercial space/water/cooking: adoption in 2025, implementation in 2031

​

​

​

Key Dates in the Legislature

• August 31 – Legislature wrapped up 2022 Legislative Session.�
• September 30 – Last day for Governor to sign or veto bills passed by the Legislature.�
• Legislature is now on recess until January.

​

Budget Updates

• On August 31, the Legislature passed the final Budget Bill Jr. (AB 179, Ting), which included the details of the final details of the multi-billion-dollar climate and energy package.
• California programs aimed at decarbonizing buildings and expanding access to efficient cooling in homes will receive over $1.4 billion in multi-year funding.
• The Governor signed AB 179 and the energy trailer bill (AB 211)

Passed out of the Legislature

• AB 2204 (Boerner Horvath): Labor/Workforce Development Agency
• Establishes the position of Deputy Secretary for Climate within the Labor and Workforce Development Agency (LWDA) to assist in the oversight of CA’s workforce transition to a sustainable and equitable carbon neutral economy.
• Signed by the Governor

​

• AB 2446 (Holden): Embodied carbon: construction materials
• Requires the CEC develop a framework for measuring and then reducing carbon intensity in the construction to achieve an 40% net reduction below 2020 levels in the carbon intensity of construction and materials used in new construction by 2035, with interim goals.
• Signed by the Governor

​

• SB 1020 (Laird): Clean Energy, Jobs, and Affordability Act
• Adds interim zero carbon electric sector targets to the existing SB 100 framework, require state agencies to purchase zero carbon electricity by 2045.
• Signed by the Governor

Passed out of the Legislature

• SB 1063 (Skinner): Appliance standards and cost-effective measures
• Allows CEC to remove the one-year delay in effective date of new or updated energy and water efficiency standards if the CEC adopts a finding that good cause exists for doing so.�
• SB 1112 (Becker): Clean Energy Financing
• Provides statutory clarity that the CEC can work with the DOE to use federal funding for innovative and inexpensive financing for zero-emission appliances.

​

• SB 1203 (Becker): Zero Net Emission State Agency Operations
• Declares the intent of the Legislature that state agencies achieve zero net emissions of GHGs resulting from their operations by 2035 or soon thereafter & requires them to develop plans by 2026 to achieve this.
• Signed by the Governor

Questions and Discussions?

Title 24, 2025 Building Code

• Scope
• The 2025 Energy Code will set requirements for new construction / alterations to res and nonres buildings, which will go into effect in 2026.�
• Update
• CEC hosted preliminary workshop to engage w/ stakeholders on cost-effectiveness methodologies.
• Enviro stakeholders have voiced concerns that the proposed for the 2025 life-cycle cost hourly factor calculations assumes CA fails to meet climate targets.
• This is the first of many workshops to start planning for the 2025 code cycle.

SGC Affordable Housing Sustainable Communities (AHSC)

• Scope
• AHSC is one of CA’s largest affordable housing development programs, providing grants to projects that are transit-oriented​ and offer reduced GHG emissions
• Update
• AHSC team will extend the Round 7 release of the Guidelines and NOFA to better align with the next HCD SuperNOFA

​

• Timeline
• December 2022: Final Guidelines will be presented to the Council
• October 2022: Final Draft Guidelines

Affordable Housing Financing: TCAC & CDLAC

• Scope
• TCAC and CDLAC are two of the biggest programs that finance the development of affordable housing. The programs' current regulations inadvertently penalize all-electric projects in the funding selection process (see comment letter here).�
• Update
• Meeting on April 27 to discuss CDLAC

​

EE Natural Gas Incentive Phase Out Staff Proposal

• Scope
• This staff proposal suggests an orderly transition to phasing out ratepayer-funded energy efficiency (EE) incentives for most natural gas measures over the next 10 years.�
• Update
• Proposal responds to a motion from the Sierra Club.
• Split the proposed policy into four tracks, one for NC, for retrofits, one for custom projects, and one for normalized metered energy consumption (NMEC) programs.
• Access Staff Proposal here

Self Generation Incentive Program (SGIP)

• Scope
• SGIP provides incentives to support existing, new, and emerging distributed energy resources. 
• $84.7 million allocated for HPWHs�
• Update
• The CPUC voted 5-0 to pass their revised HPWH Program Proposed Decision.�

​

CA Budget Process: Overview

AB 32 Scoping Plan

• Scope
• AB 32 requires CARB to develop a Scoping Plan that describes the approach California will take to reduce GHGs to achieve the state's climate goals�
• Update
• Governor Newsom sent CARB Chair Randolph a letter calling for the 2022 Climate Change Scoping Plan to provide a path to achieve both the 2030 climate goal and carbon neutrality no later than 2045. �
• Requested final plan include new efforts to advance offshore wind, clean fuels, climate-friendly homes, carbon removal, and addressing methane leaks:�
• Goal of 3 million climate-ready and climate-friendly homes by 2030 and 7 million by 2035,
• Supplemented by 6 million heat pumps by 2030
• Directed 50 percent of investments to low-income and disadvantaged communities.�

BUILD 2.0: CA Electric Homes Program

• Scope
• The CalEHP program will provide incentives for the construction of new all-electric market-rate residential buildings and installation of energy storage systems.�
• Update
• The CEC’s grant solicitation to hire a third-party administrator for the CalEHP has been posted and is open for application submission.
• The solicitation can be found here and a recording of the pre-application workshop can be found here.�
• Timeline
• The submission period is until August 1, 2022.