Section § 38560

Explanation

This law requires the state board to create public rules for reducing greenhouse gas emissions in a way that balances maximum efficiency with cost-effectiveness.

The state board shall adopt rules and regulations in an open public process to achieve the maximum technologically feasible and cost-effective greenhouse gas emission reductions from sources or categories of sources, subject to the criteria and schedules set forth in this part.

Section § 38560.5

Explanation

By June 30, 2007, California's state board needs to provide a list of early steps to reduce greenhouse gases before more extensive measures are enacted. Then, by January 1, 2010, the state board must adopt rules to put these early steps into action.

The rules should aim for the greatest possible and cost-effective reduction in greenhouse gases, helping meet California's overall emissions limits. These rules must be enforceable starting January 1, 2010.

(a)CA Health and Safety Code § 38560.5(a) On or before June 30, 2007, the state board shall publish and make available to the public a list of discrete early action greenhouse gas emission reduction measures that can be implemented prior to the measures and limits adopted pursuant to Section 38562.
(b)CA Health and Safety Code § 38560.5(b) On or before January 1, 2010, the state board shall adopt regulations to implement the measures identified on the list published pursuant to subdivision (a).
(c)CA Health and Safety Code § 38560.5(c) The regulations adopted by the state board pursuant to this section shall achieve the maximum technologically feasible and cost-effective reductions in greenhouse gas emissions from those sources or categories of sources, in furtherance of achieving the statewide greenhouse gas emissions limit.
(d)CA Health and Safety Code § 38560.5(d) The regulations adopted pursuant to this section shall be enforceable no later than January 1, 2010.

Section § 38560.7

Explanation

The state board is required to set up and keep an online dashboard to show how California is doing with its statewide climate change goals. This dashboard will provide updated and publicly accessible information about greenhouse gas emissions.

The state board shall create, and maintain on its internet website, a greenhouse gas emissions dashboard that provides updated publicly available information regarding how the state is progressing toward meeting its statewide climate change goals.

Section § 38561

Explanation

This section mandates that by January 1, 2009, California's state board must create a comprehensive plan to reduce greenhouse gas emissions as much as possible using available technology and cost-effective methods by 2020. The plan requires collaboration with relevant state agencies to ensure measures are efficient, non-overlapping, and feasible.

The plan should outline various strategies for reducing emissions, including alternative and market-based mechanisms, and incentives. It should consider emissions reduction programs from other regions, and evaluate the economic, environmental, and public health impacts on California.

The state board must assess the contributions of different emission sources, potential impacts on small businesses, and set a threshold for minimal emissions below which reductions are not required.

Opportunities for voluntary actions like carbon sequestration should also be identified. Public workshops, especially in pollution-affected regions, are required to gather feedback. The plan must be updated every five years.

(a)CA Health and Safety Code § 38561(a) On or before January 1, 2009, the state board shall prepare and approve a scoping plan, as that term is understood by the state board, for achieving the maximum technologically feasible and cost-effective reductions in greenhouse gas emissions from sources or categories of sources of greenhouse gases by 2020 under this division. The state board shall consult with all state agencies with jurisdiction over sources of greenhouse gases, including the Public Utilities Commission and the State Energy Resources Conservation and Development Commission, on all elements of its plan that pertain to energy-related matters including, but not limited to, electrical generation, load based-standards or requirements, the provision of reliable and affordable electrical service, petroleum refining, and statewide fuel supplies to ensure the greenhouse gas emissions reduction activities to be adopted and implemented by the state board are complementary, nonduplicative, and can be implemented in an efficient and cost-effective manner.
(b)CA Health and Safety Code § 38561(b) The plan shall identify and make recommendations on direct emissions reduction measures, alternative compliance mechanisms, market-based compliance mechanisms, and potential monetary and nonmonetary incentives for sources and categories of sources that the state board finds are necessary or desirable to facilitate the achievement of the maximum feasible and cost-effective reductions of greenhouse gas emissions by 2020.
(c)CA Health and Safety Code § 38561(c) In making the determinations required by subdivision (b), the state board shall consider all relevant information pertaining to greenhouse gas emissions reduction programs in other states, localities, and nations, including the northeastern states of the United States, Canada, and the European Union.
(d)CA Health and Safety Code § 38561(d) The state board shall evaluate the total potential costs and total potential economic and noneconomic benefits of the plan for reducing greenhouse gases to California’s economy, environment, and public health, using the best available economic models, emission estimation techniques, and other scientific methods.
(e)CA Health and Safety Code § 38561(e) In developing its plan, the state board shall take into account the relative contribution of each source or source category to statewide greenhouse gas emissions, and the potential for adverse effects on small businesses, and shall recommend a de minimis threshold of greenhouse gas emissions below which emissions reduction requirements will not apply.
(f)CA Health and Safety Code § 38561(f) In developing its plan, the state board shall identify opportunities for emissions reduction measures from all verifiable and enforceable voluntary actions, including, but not limited to, carbon sequestration projects and best management practices.
(g)CA Health and Safety Code § 38561(g) The state board shall conduct a series of public workshops to give interested parties an opportunity to comment on the plan. The state board shall conduct a portion of these workshops in regions of the state that have the most significant exposure to air pollutants, including, but not limited to, areas designated as federal extreme nonattainment that have communities with minority populations, communities with low-income populations, or both.
(h)CA Health and Safety Code § 38561(h) The state board shall update its plan for achieving the maximum technologically feasible and cost-effective reductions of greenhouse gas emissions at least once every five years.

Section § 38561.2

Explanation

This law requires that by July 1, 2023, California's state board develop a detailed plan to achieve net-zero greenhouse gas emissions from cement used within the state by no later than December 31, 2045. The board must set interim targets aiming to reduce cement's greenhouse gas emissions by 40% from 2019 levels by 2035.

The board will not count emission offsets unrelated to cement production itself. By July 2028, the board will assess progress and may change targets based on technology improvements, with any adjustments thoroughly documented. The board must define greenhouse gas metrics, evaluate data, and develop measures to address barriers.

Additionally, the board needs to consider market demand, air quality, community impacts, and align efforts with other agencies while prioritizing cost-saving incentives. The plan also includes actions to reduce adverse effects on communities near cement plants and potential carbon costs on imported cement. The strategy will be implemented when funded by the Legislature.

(a)Copy CA Health and Safety Code § 38561.2(a)
(1)Copy CA Health and Safety Code § 38561.2(a)(1) By July 1, 2023, the state board shall develop a comprehensive strategy for the state’s cement sector to achieve net-zero emissions of greenhouse gases associated with cement used within the state as soon as possible, but no later than December 31, 2045.
(2)CA Health and Safety Code § 38561.2(a)(2) To ensure adequate progress is made toward achieving the goal established in paragraph (1), the state board shall establish interim targets for reductions in the greenhouse gas intensity of cement used within the state relative to the average greenhouse gas intensity of cement used within the state during the 2019 calendar year, with the goal of reducing the greenhouse gas intensity of cement used within the state to 40 percent below the 2019 average levels by December 31, 2035.
(3)CA Health and Safety Code § 38561.2(a)(3) When determining the greenhouse gas intensity of cement, the state board shall not include greenhouse gas emissions reductions attributable to activities or offsets that are unrelated to the raw materials, fuels or other energy sources, processes, or transportation involved in making or using cement or its inputs.
(4)Copy CA Health and Safety Code § 38561.2(a)(4)
(A)Copy CA Health and Safety Code § 38561.2(a)(4)(A) By July 1, 2028, the state board shall evaluate the feasibility of achieving the interim targets established under paragraph (2) and may adjust the interim targets upward or downward to reflect technological advancements and progress in addressing barriers to the deployment of greenhouse gas emissions reduction technologies and processes, including those barriers for which measures have been identified pursuant to paragraph (7) of subdivision (b).
(B)CA Health and Safety Code § 38561.2(a)(4)(A)(B) If the state board makes a downward adjustment to any interim target established under paragraph (2), the state board shall document the feasibility constraints the state board has identified and recommend measures and actions, including proposed statutory changes, necessary to overcome those constraints to enable the cement sector to achieve net-zero emissions of greenhouse gases as soon as possible, but no later than December 31, 2045.
(b)CA Health and Safety Code § 38561.2(b) In developing the comprehensive strategy pursuant to subdivision (a), the state board shall do all of the following:
(1)CA Health and Safety Code § 38561.2(b)(1) Define a metric for greenhouse gas intensity and evaluate the data submitted by cement manufacturing plants to the state board for the 2019 calendar year and other relevant data about emissions of greenhouse gases for cement that was imported into the state to establish a baseline from which to measure greenhouse gas intensity reductions.
(2)CA Health and Safety Code § 38561.2(b)(2) Assess the effectiveness of existing measures, identify any modifications to existing measures, and evaluate new measures to overcome the market, statutory, and regulatory barriers inhibiting achievement of the objectives described in this section.
(3)CA Health and Safety Code § 38561.2(b)(3) Identify actions that reduce adverse air quality impacts and support economic and workforce development in communities neighboring cement plants.
(4)CA Health and Safety Code § 38561.2(b)(4) Include provisions to minimize and mitigate potential leakage and account for embedded emissions of greenhouse gases in imported cement in a similar manner to emissions of greenhouse gases for cement produced in the state, such as through a border carbon adjustment mechanism.
(5)CA Health and Safety Code § 38561.2(b)(5) Coordinate and consult with other state agencies, districts, and experts in academia, industry, and public health, and with local communities.
(6)CA Health and Safety Code § 38561.2(b)(6) Prioritize actions that leverage state and federal incentives, where applicable, to reduce costs of implementing greenhouse gas emissions reduction technologies and processes and to increase economic value for the state.
(7)CA Health and Safety Code § 38561.2(b)(7) Evaluate measures to support market demand and financial incentives to encourage the production and use of cement with low greenhouse gas intensity, including, but not limited to, consideration of all of the following measures:
(A)CA Health and Safety Code § 38561.2(b)(7)(A) Measures to expedite the adoption for use in projects undertaken by state agencies, including the Department of Transportation, of Portland limestone cement and other blended cements.
(B)CA Health and Safety Code § 38561.2(b)(7)(B) Measures to provide financial support and incentives for research, development, and demonstration of technologies to mitigate emissions of greenhouse gases from the production of cement with the objective of accelerating industry deployment of those technologies.
(C)CA Health and Safety Code § 38561.2(b)(7)(C) Measures to facilitate fuel switching.
(D)CA Health and Safety Code § 38561.2(b)(7)(D) Measures to create incentives and remove obstacles for energy efficiency improvements and waste heat recovery at cement manufacturing facilities.
(c)CA Health and Safety Code § 38561.2(c) The state board shall implement the strategy developed pursuant to this section, upon appropriation by the Legislature.

Section § 38561.3

Explanation

This law requires the state board, with input from various stakeholders, to create a framework by 2026 for measuring the carbon intensity of materials used in building projects. By 2028, a strategy to reduce greenhouse gas emissions from these materials by 40% by 2035 must be developed. This involves requiring construction projects over a certain size to submit life-cycle assessments that evaluate the carbon impact of materials used and requiring manufacturers to provide Environmental Product Declarations.

The law provides guidelines for assessing the feasibility and cost impact of using lower carbon materials, setting clear definitions for both. It mandates a reporting system to track progress toward emission reduction goals and ensures that construction projects are compliant if they meet criteria even if targets are not fully met due to feasibility or cost. The law also highlights the importance of incentives and support measures to encourage the use of materials with lower carbon intensity. Penalties apply for non-compliance with these emission goals, but no penalties for failure if due care is shown and targets are deemed met.

(a)CA Health and Safety Code § 38561.3(a) By December 31, 2026, the state board, in consultation with relevant stakeholders, including, but not limited to, the California Building Standards Commission, the Department of Housing and Community Development, and the State Energy Resources Conservation and Development Commission, shall develop a framework for measuring the average carbon intensity of the materials used in the construction of new buildings, including those for residential uses.
(b)CA Health and Safety Code § 38561.3(b) The state board shall also develop, by December 31, 2028, a comprehensive strategy for the state’s building sector to achieve a 40-percent net reduction in greenhouse gas emissions of building materials as soon as possible, but no later than December 31, 2035. The baseline for the 40-percent net reduction shall be established based on an industry average of environmental product declarations reported for the 2026 calendar year, or the most relevant, up-to-date data that is available, as determined by the state board.
(c)CA Health and Safety Code § 38561.3(c) The framework developed pursuant to subdivision (a) shall include both of the following:
(1)CA Health and Safety Code § 38561.3(c)(1) A requirement for the submission by an entity undertaking the construction of a project with a minimum size of five new residential units or 10,000 square feet of nonresidential building space of a life-cycle assessment, as defined in the International Organization for Standardization (ISO) 14040 series of standards with a focus on the Product Stage phases (A1-A3), to determine the carbon intensity of the materials used in new residential and nonresidential buildings.
(2)CA Health and Safety Code § 38561.3(c)(2) A requirement for the submission by the manufacturer of a building material of an Environmental Product Declaration, Type III, as defined by the International Organization for Standardization (ISO) Standard 14025, or similarly robust material life-cycle assessment approaches that have uniform standards in data collection consistent with ISO Standard 14025, industry acceptance, and integrity for construction materials used for the building. The state board shall determine how to proceed in the event that insufficient material life-cycle assessments or Environmental Product Declarations exist, or in the event of significant supply chain issues.
(d)CA Health and Safety Code § 38561.3(d) The framework developed pursuant to subdivision (a) may include a tracking and reporting mechanism in order to facilitate the reporting of data to the state board on the carbon intensity of buildings, and that would also allow tracking of progress toward the carbon intensity reduction targets set forth in this section. Except for a fee to reimburse the state board for any administrative costs incurred in administering the reporting mechanism, the state board shall not impose any other charges on the participants in the reporting mechanism authorized under this subdivision.
(e)CA Health and Safety Code § 38561.3(e) Based on the information submitted by an entity undertaking the construction of a covered project pursuant to paragraph (2) of subdivision (i), as well as other relevant information as determined by the state board, the state board shall evaluate the cost impact and feasibility of implementation of the strategy developed pursuant to subdivision (b), for the purpose of developing recommendations for addressing known cost impact and feasibility issues in strategy implementation. This subdivision does not affect the project’s status as deemed to comply with the applicable target based on the finding made solely by the entity undertaking the construction of a project pursuant to paragraphs (1) and (2) of subdivision (i).
(f)CA Health and Safety Code § 38561.3(f) As used in this section the following terms have the following meanings:
(1)CA Health and Safety Code § 38561.3(f)(1) “Feasibility,” in regard to the use of a material, means all of the following:
(A)CA Health and Safety Code § 38561.3(f)(1)(A) The material is capable of being installed in a successful manner within a reasonable period of time, taking into account economic, environmental, legal, social, and technological factors.
(B)CA Health and Safety Code § 38561.3(f)(1)(B) The material does not harm the health or safety of those who install the materials or occupy the building.
(C)CA Health and Safety Code § 38561.3(f)(1)(C) The building using the material can be designed to provide an equivalent function and, at a minimum, the same useful life, performance, and durability as the building made with baseline materials.
(D)CA Health and Safety Code § 38561.3(f)(1)(D) The material is commercially available to the region of the project.
(E)CA Health and Safety Code § 38561.3(f)(1)(E) The material has not been involved in a claim for a construction or design defect, breach of express or implied warranty, fraud, or misrepresentation.
(F)CA Health and Safety Code § 38561.3(f)(1)(F) The material provides an equivalent function and at least the same useful life, performance, and durability as the baseline material.
(2)Copy CA Health and Safety Code § 38561.3(f)(2)
(A)Copy CA Health and Safety Code § 38561.3(f)(2)(A) “Cost impact” means a significant overall material or operational cost increase or schedule delay resulting from incorporating the lower carbon material.
(B)CA Health and Safety Code § 38561.3(f)(2)(A)(B) As used in subparagraph (A), “significant” means an increase of 5 percent or more in the operational or overall material cost at the location of the project or time schedule delay that is attributable to incorporating a lower carbon material compared to the baseline material for which it is a substitute in the project. For purposes of this paragraph, the baseline material shall be the material that would have been used by the entity undertaking the construction of the project if this section did not apply to the project at the time the application for the building permit is submitted for a model home or project, as applicable.
(g)CA Health and Safety Code § 38561.3(g) The state board shall allow the entity undertaking the construction of a project to use the same persons as those responsible for the Certificate of Installation pursuant to paragraph (3) of subdivision (a) of Section 10-103 of Title 25 of the California Code of Regulations in submitting, reporting, notifying, tracking, or otherwise conveying information to the state board.
(h)CA Health and Safety Code § 38561.3(h) The targets established by this section shall begin to apply no sooner than January 1, 2027, and two years after the baseline is established. The applicable target for each residential unit built within a project shall be the target that applied at the time the application was submitted for a building permit of the first model home in the project. For projects that do not use model homes, the applicable target shall be the target in effect at the time of submission of the application for the building permit.
(i)Copy CA Health and Safety Code § 38561.3(i)
(1)Copy CA Health and Safety Code § 38561.3(i)(1) For buildings covered by this section, the incorporation of lower carbon materials shall be limited or excluded to the extent that it has a cost impact or is unfeasible.
(2)CA Health and Safety Code § 38561.3(i)(2) An entity undertaking the construction of a project may seek to achieve the applicable target through the use of materials or methods pursuant to this section and, if an embodied carbon trading system is established or other alternative compliance method, pursuant to Section 38561.6, separately or in combination, as determined by the available compliance methods. If the entity undertaking the construction of a project uses materials or methods described in this section, Section 38561.6, or both, subject to the feasibility criteria and up to the cost impact limit, and the entity finds that it is still unable to achieve the applicable target due to unfeasibility or cost impact, then the project shall be deemed to comply with the applicable target. In that case, the entity undertaking the construction of a project shall provide the state board with documentation that shall be specified in the reporting and recordkeeping regulations that will be established by the state board.
(3)CA Health and Safety Code § 38561.3(i)(3) The state board shall consult experts, including, but not limited to, building product manufacturers, builders, and design professionals, to advise the state board on methods to reduce the carbon intensity of building materials and covered projects, while maintaining the avoidance of cost impact and their feasibility.
(4)CA Health and Safety Code § 38561.3(i)(4) The state board shall not have the authority to approve, deny, or delay the planning, use, development, design, or construction of a project.
(5)CA Health and Safety Code § 38561.3(i)(5) Manufacturers of building materials shall be required to report data to the state board to ensure that their products comply with applicable reduction targets in accordance with reporting and compliance requirements that will be established by the state board.
(j)CA Health and Safety Code § 38561.3(j) This section does not apply to appliances.
(k)CA Health and Safety Code § 38561.3(k) For purposes of the California Environmental Quality Act (Division 13 (commencing with Section 21000) of the Public Resources Code), no adverse environmental impact associated with the manufacture of building materials may be attributed, directly or indirectly, to the project incorporating the building material. This subdivision does not relieve the entity undertaking the construction of a covered project from complying with any other provision within this section.
(l)CA Health and Safety Code § 38561.3(l) In developing the strategy pursuant to subdivision (b), the state board shall do all of the following:
(1)CA Health and Safety Code § 38561.3(l)(1) Research and prioritize actions and provisions that leverage state and federal incentives, where applicable, to reduce costs of implementing greenhouse gas emissions reduction technologies, processes, and materials used in construction-related projects for the construction industry, homeowners, and developers, and to increase economic value for the state.
(2)CA Health and Safety Code § 38561.3(l)(2) Evaluate measures to support market demand and financial incentives to encourage the production and use of materials used in construction-related projects with low greenhouse gas intensity, including, but not limited to, consideration of the following measures:
(A)CA Health and Safety Code § 38561.3(l)(2)(A) Measures to expedite the adoption for use in projects undertaken by state agencies, including the Department of Transportation and the Department of General Services.
(B)CA Health and Safety Code § 38561.3(l)(2)(B) Measures to provide financial support and incentives for research, development, and demonstration of technologies to mitigate emissions of greenhouse gases from the manufacture of materials used in construction-related projects, with the objective of accelerating commercial availability of those technologies.
(C)CA Health and Safety Code § 38561.3(l)(2)(C) Measures to provide consumer access to building material embodied carbon data reported to the state board.
(m)CA Health and Safety Code § 38561.3(m) The Administrative Procedure Act (Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code) does not apply to reporting regulations and reporting standards promulgated pursuant to this section. Prior to adopting those reporting standards and regulations pursuant to this section, the proposed rulemaking shall be made available to the public and stakeholders for comment and workshopping. The state board, the California Building Standards Commission, the Department of Housing and Community Development, and the State Energy Resources Conservation and Development Commission shall exchange technical information with each other as part of this process prior to the adoption of any reporting standard or regulation pursuant to this section. All other regulations adopted pursuant to this section are subject to the Administrative Procedure Act.
(n)CA Health and Safety Code § 38561.3(n) Division 13 (commencing with Section 21000) of the Public Resources Code does not apply to the state board’s development and approval of the framework and comprehensive strategy developed pursuant to this section.
(o)CA Health and Safety Code § 38561.3(o) Paragraphs (1) and (2) of subdivision (i) apply when the state board adopts any mechanism, standard, requirement, regulation, rule, protocol, framework, strategy, credit, target, or establishes an embodied carbon trading system, or alternative incentives or compliance programs, whichever occurs first.
(p)CA Health and Safety Code § 38561.3(p) Penalties relating to the use or failure to use low-carbon building materials, or the failure to achieve the applicable target, may not be applied to an entity undertaking the construction of a project that is deemed to comply pursuant to paragraphs (1) and (2) of subdivision (i).
(q)CA Health and Safety Code § 38561.3(q) Except as otherwise provided in subdivision (p), penalties for a violation of this section are limited to the penalties described in subdivisions (a) and (d) of Section 42402, unless the violation shows a disregard for the regulations under this section, extreme negligence, or acts of deceit, in which case the penalties set forth in subdivision (b) of Section 42402 apply.
(r)CA Health and Safety Code § 38561.3(r) Notwithstanding any other law, the penalties described in subdivision (q) are the exclusive enforcement mechanism against regulated entities for a violation of this section and Section 38561.6.
(s)CA Health and Safety Code § 38561.3(s) As used in this section, “entity undertaking the construction of a project” means a person or entity who owns the real property that is the subject of a development agreement.

Section § 38561.5

Explanation

This section outlines how California aims to use its natural and working lands to fight climate change by removing greenhouse gases from the atmosphere. It defines key terms like 'natural carbon sequestration' and 'nature-based climate solutions'. By January 1, 2024, state agencies must set targets for reducing emissions and increasing carbon storage through these methods, and these targets will help the state meet its climate goals.

Starting in 2025, every two years, these agencies must report on progress through a strategic plan, detailing actions taken and their benefits, especially for disadvantaged communities. An expert advisory committee, including Indigenous and environmental representatives, will guide these efforts and assess any barriers to reaching the targets. Methods to track emissions and measure success consistently will also be developed by the state board.

(a)CA Health and Safety Code § 38561.5(a) For purposes of this section, the following definitions apply:
(1)CA Health and Safety Code § 38561.5(a)(1) “Natural carbon sequestration” means actions that are undertaken on natural and working lands to remove and provide storage of atmospheric greenhouse gases in vegetation and soils. This shall include preservation, conservation, restoration, and sustainable management of these lands, which may include compost application, cover crops, hedgerows, planned grazing, urban forestry, riparian restoration, restoration of tidal flows to wetlands, and other forms of wetland restoration, among other relevant actions.
(2)CA Health and Safety Code § 38561.5(a)(2) “Natural lands” has the same meaning as set forth in paragraph (2) of subdivision (d) of Section 9001.5 of the Public Resources Code.
(3)CA Health and Safety Code § 38561.5(a)(3) “Nature-based climate solutions” means activities, such as restoration, conservation, and land management actions, that increase net carbon sequestration or reduce greenhouse gas emissions in natural and working lands.
(4)CA Health and Safety Code § 38561.5(a)(4) “Vulnerable communities” has the same meaning as set forth in subdivision (d) of Section 71340 of the Public Resources Code.
(5)CA Health and Safety Code § 38561.5(a)(5)  “Working lands” has the same meaning as set forth in paragraph (1) of subdivision (d) of Section 9001.5 of the Public Resources Code.
(b)Copy CA Health and Safety Code § 38561.5(b)
(1)Copy CA Health and Safety Code § 38561.5(b)(1) On or before January 1, 2024, the Natural Resources Agency, in collaboration with the state board, the California Environmental Protection Agency, the Department of Food and Agriculture, the expert advisory committee established pursuant to subdivision (c), and other relevant state agencies, shall determine an ambitious range of targets for natural carbon sequestration, and for nature-based climate solutions, that reduce greenhouse gas emissions for 2030, 2038, and 2045 to support state goals to achieve carbon neutrality and foster climate adaptation and resilience. These targets shall be integrated into the scoping plan prepared pursuant to Section 38561 and other state policies.
(2)CA Health and Safety Code § 38561.5(b)(2) Projects and actions developed to achieve the targets established pursuant to paragraph (1) shall support the state’s efforts to achieve carbon neutrality, take into account climate impacts, increase resilience to climate change impacts, reduce greenhouse gas emissions, and enhance carbon sequestration in a manner that maximizes ecological health and biodiversity, and complements other climate and resources goals.
(3)CA Health and Safety Code § 38561.5(b)(3) The state board shall ensure that all emissions reductions from projects and actions developed to achieve the targets established pursuant to paragraph (1) shall be accounted for in a manner that does not result in double counting of emissions reductions, and that all greenhouse gas emissions reductions and removals used for any market-based compliance mechanism are in addition to any reductions and removals that would otherwise occur.
(4)CA Health and Safety Code § 38561.5(b)(4) On or before January 1, 2025, the Natural Resources Agency, in consultation with the state board, the California Environmental Protection Agency, and the Department of Food and Agriculture, shall review and update the Natural and Working Lands Climate Smart Strategy established pursuant to Section 39740.2 to achieve the targets established pursuant to paragraph (1).
(5)CA Health and Safety Code § 38561.5(b)(5) The review and update pursuant to paragraph (4) shall include all of the following:
(A)CA Health and Safety Code § 38561.5(b)(5)(A) Descriptions of the actions and projects undertaken on natural and working lands to date.
(B)CA Health and Safety Code § 38561.5(b)(5)(B) Quantified progress on emissions reductions, natural carbon sequestration, and cobenefits.
(C)CA Health and Safety Code § 38561.5(b)(5)(C) A description of how the relevant agencies calculated emissions reductions, natural carbon sequestration, and cobenefits.
(D)CA Health and Safety Code § 38561.5(b)(5)(D) A summary of the benefits to low-income communities, disadvantaged communities, vulnerable communities, disadvantaged farmers, and Native American tribes.
(E)CA Health and Safety Code § 38561.5(b)(5)(E) An evaluation of the efficacy of the priority nature-based solutions, pathways, and priority actions for greenhouse gas reductions, climate resilience, and climate change adaptation.
(F)CA Health and Safety Code § 38561.5(b)(5)(F) Identification and description of any barriers to achieving the range of targets pursuant to paragraph (1).
(G)CA Health and Safety Code § 38561.5(b)(5)(G) Recommendations to address the barriers identified in subparagraph (F) to achieve the range of targets pursuant to paragraph (1).
(H)CA Health and Safety Code § 38561.5(b)(5)(H) Recommendations from the expert advisory committee established pursuant to subdivision (c).
(c)CA Health and Safety Code § 38561.5(c) The Natural Resources Agency and the state board shall jointly establish an expert advisory committee that is composed of university researchers, technical assistance providers, practitioners and other experts in the field of climate change and natural and working lands science and management, and Indigenous and environmental justice representatives, to inform and review modeling and analyses for natural and working lands, to advise state agencies on implementation strategies and standardized accounting, and to provide recommendations on addressing barriers to efficient implementation of this section.
(d)CA Health and Safety Code § 38561.5(d) No later than January 1, 2025, the state board shall develop standard methods for state agencies to consistently track greenhouse gas emissions and reductions, carbon sequestration, and, where feasible and in consultation with the Natural Resources Agency and the Department of Food and Agriculture, additional benefits from natural and working lands over time. In estimating and tracking greenhouse gas emissions and reductions and carbon sequestration from natural and working lands, the state board shall take into account, where feasible, both of the following:
(1)CA Health and Safety Code § 38561.5(d)(1) Greenhouse gas emissions and reductions of carbon dioxide, methane, and nitrous oxide related to natural and working lands.
(2)CA Health and Safety Code § 38561.5(d)(2) Potential impacts of climate change, including, but not limited to, increased fire risk, warming temperatures, and decreasing precipitation, on the ability to reduce greenhouse gas emissions and sequester carbon from natural and working lands.
(e)CA Health and Safety Code § 38561.5(e) On or before January 1, 2025, and every two years thereafter, the Natural Resources Agency shall publish data on its internet website on progress made in achieving the targets established pursuant to paragraph (1) of subdivision (b), including on state expenditures made to implement these targets.

Section § 38561.6

Explanation

This section of the California Health and Safety Code addresses setting up a system to reduce carbon emissions in building materials. It defines key terms related to carbon emissions, like 'carbon intensity' and 'embodied carbon trading system'. The focus is on reducing greenhouse gases linked to building materials by allowing the trading of carbon credits. The system aims to make construction more sustainable through incentives for using low-carbon materials in new buildings.

The state board may create a trading system that lets construction projects and material manufacturers buy and sell carbon credits. The goal is to ensure the building industry can cut emissions without making projects too costly or complicated. The state board can adopt rules and work with other agencies to ensure these changes are smoothly integrated and consistently monitored.

Finally, this section makes it clear that no new revenue-generating programs are allowed and enforcement will be through penalties only, as specified in linked regulations. Overall, this law seeks to promote environmentally friendly building practices without overwhelming stakeholders with costs or regulations.

(a)CA Health and Safety Code § 38561.6(a) For purposes of this section, the following definitions apply:
(1)CA Health and Safety Code § 38561.6(a)(1) “Carbon intensity” means the quantity of life-cycle greenhouse gas emissions per unit of building material, and specifically the ratio between the net upstream carbon dioxide impact (emissions minus storage) of a material and the weight of the material.
(2)CA Health and Safety Code § 38561.6(a)(2) “Embodied carbon trading system” means a market-based credit trading platform of greenhouse gas emissions exchanges, banking, credits, and other transactions, governed by rules and protocols established by the state board, that result in the same greenhouse gas emission reduction, over the same time period, as direct compliance with a greenhouse gas emission limit or emission reduction measure adopted by the state board pursuant to this division.
(3)CA Health and Safety Code § 38561.6(a)(3) “Low-carbon building standard” means a framework created pursuant to Section 38561.3 to reduce by 40 percent the carbon intensity of the materials used in newly constructed buildings identified in paragraph (1) of subdivision (c) of Section 38561.3 and within the embodied carbon trading system, to facilitate a credit trading platform for building materials along with other requirements as specified.
(4)CA Health and Safety Code § 38561.6(a)(4) “Material life-cycle” means the aggregate of greenhouse gas emissions associated with material production, as defined in the International Organization for Standardization (ISO) 14040 series of standards with a focus on the Product Stage phases (A1-A3).
(5)CA Health and Safety Code § 38561.6(a)(5) “Entity undertaking the construction of a project” means a person or entity who owns the real property that is the subject of a development agreement.
(b)CA Health and Safety Code § 38561.6(b) The state board may establish an embodied carbon trading system in compliance with the requirements set forth in Section 38561.3 and this section that meets both of the following requirements:
(1)CA Health and Safety Code § 38561.6(b)(1) If the state board opts to establish an embodied carbon trading system, the system shall be designed to be used by entities undertaking a construction project and building material manufacturers.
(2)CA Health and Safety Code § 38561.6(b)(2) The embodied carbon trading system unit of measurement shall be Global Warming Potential (GWP) per gross square foot (kg CO2e/sq. ft.2).
(c)CA Health and Safety Code § 38561.6(c) The state board shall have the flexibility to design the embodied carbon trading system and may do all of the following with respect to the embodied carbon trading system:
(1)Copy CA Health and Safety Code § 38561.6(c)(1)
(A)Copy CA Health and Safety Code § 38561.6(c)(1)(A) Adopt rules and regulations for the credit allocation approach, the anticipated carbon price in the scheme, and trading periods.
(B)CA Health and Safety Code § 38561.6(c)(1)(A)(B) In developing the rules and regulations for the credit allocation approach, including those governing any tradeable compliance instrument, make efforts to avoid an overabundance of compliance credits in the market, and, to this end, may consider setting an upper limit on amount of credits that can be generated per unit of material.
(2)CA Health and Safety Code § 38561.6(c)(2) Consider using the credits generated through the use of the embodied carbon trading system to help promote innovation and investment in building construction materials that reduce emissions of greenhouse gases.
(3)CA Health and Safety Code § 38561.6(c)(3) Consider all relevant information pertaining to low-carbon building materials reduction programs in other states, localities, and nations, including other states, Canada, and the European Union, and, in doing so, review existing and proposed international, federal, and state greenhouse gas emission reporting programs, make reasonable efforts to promote consistency among the programs established pursuant to this division and other programs, and streamline reporting requirements on greenhouse gas emission sources.
(4)CA Health and Safety Code § 38561.6(c)(4) Integrate the embodied carbon trading system with the framework described in Section 38561.3 on or before December 31, 2026, and shall implement that system on and after January 1, 2029.
(5)CA Health and Safety Code § 38561.6(c)(5) Consult with the California Building Standards Commission, the Department of Housing and Community Development, and the State Energy Resources Conservation and Development Commission in the development of building regulations, in order to minimize duplicate or inconsistent regulatory requirements.
(d)CA Health and Safety Code § 38561.6(d) The state board shall have the discretion to adopt further greenhouse gas emission reduction targets within the scope of Section 38561.3 prior to December 31, 2035, or provide early reduction credit considering market adoption, if appropriate.
(e)CA Health and Safety Code § 38561.6(e) In developing its plan, the state board shall identify opportunities for emission reduction measures from all verifiable and enforceable actions, and best management practices.
(f)Copy CA Health and Safety Code § 38561.6(f)
(1)Copy CA Health and Safety Code § 38561.6(f)(1) The state board may adopt rules and regulations to monitor, verify, and enforce reductions in embodied carbon in building materials pursuant to this section and Section 38561.3.
(2)CA Health and Safety Code § 38561.6(f)(2) The state board shall minimize the administrative burden of implementing and complying with these regulations when possible.
(3)CA Health and Safety Code § 38561.6(f)(3) The state board shall design any rules and regulations to encourage manufacturers of building materials to produce low-carbon materials for sale in California to ensure that entities that undertake construction of projects identified in paragraph (1) of subdivision (c) of Section 38561.3 have an adequate supply of low-carbon materials that meet all of the feasibility and cost impact requirements of subdivision (f) of Section 38561.3 to meet the greenhouse gas reduction targets established in Section 38561.3.
(g)CA Health and Safety Code § 38561.6(g) The state board may consider the use of third parties, such as verifiers, for purposes of implementing the requirements of this section.
(h)CA Health and Safety Code § 38561.6(h) Compliance mechanisms, reporting requirements, and penalties for noncompliance with any compliance standards or an embodied carbon trading system established pursuant to this section or Section 38561.3 will be determined by the administrative process. The carbon trading system established pursuant to this section alone or in combination with Section 38561.3 shall not cause a project to have a cost impact or be unfeasible as those terms are defined in subdivision (f) of Section 38561.3.
(i)CA Health and Safety Code § 38561.6(i) The state board shall periodically review and update its emission reporting and compliance standard requirements, as necessary.
(j)CA Health and Safety Code § 38561.6(j) This section does not limit the state board’s ability to establish alternative incentives or compliance programs aside from or in addition to an embodied carbon trading system.
(k)CA Health and Safety Code § 38561.6(k) This section provides guidance only. This section does not limit or expand the authority of the state board.
(l)CA Health and Safety Code § 38561.6(l) This section does not authorize the creation of a revenue-generating program or any other program that would result in moneys being paid to the state, other than penalties imposed for a violation of this section.
(m)CA Health and Safety Code § 38561.6(m) Notwithstanding any other law, the penalties described in subdivision (q) of Section 38561.3 are the exclusive enforcement mechanism against regulated entities for a violation of this section.

Section § 38561.7

Explanation

This law requires the state board, in its next update to the scoping plan, to include discussions on both industrial emissions sources with available zero-emission alternatives and those without such alternatives.

It becomes inactive after July 1, 2028, and will be officially repealed on January 1, 2029.

(a)CA Health and Safety Code § 38561.7(a) In the next update to the scoping plan prepared pursuant to Section 38561, the state board shall include both of the following:
(1)CA Health and Safety Code § 38561.7(a)(1) A discussion of industrial sources of emissions of greenhouse gases for which there are zero-emission alternatives currently technologically available.
(2)CA Health and Safety Code § 38561.7(a)(2) A discussion of industrial sources of emissions of greenhouse gases for which there are no zero-emission alternatives currently technologically available.
(b)CA Health and Safety Code § 38561.7(b) This section shall become inoperative on July 1, 2028, and, as of January 1, 2029, is repealed.

Section § 38561.8

Explanation

This law section defines 'decarbonize' as reducing or eliminating greenhouse gas emissions. It tasks the state board, along with other commissions, to prepare an evaluation by June 1, 2024, focused on the role of hydrogen in California's climate goals. This includes policy recommendations for green hydrogen, strategies for supporting hydrogen infrastructure, and the potential of all hydrogen types to reduce emissions.

It also involves analyzing how electrical generation can be utilized for green hydrogen production, estimating emission reductions, evaluating health impacts, and suggesting regulatory processes. Additionally, it assesses hydrogen's role in water treatment and examines life-cycle emissions and environmental impacts. Overall, it aims to integrate hydrogen solutions into California's energy and environmental strategies.

(a)CA Health and Safety Code § 38561.8(a) For purposes of this section, “decarbonize” means to reduce or eliminate associated emissions of greenhouse gases.
(b)CA Health and Safety Code § 38561.8(b) The state board, in consultation with the State Energy Resources Conservation and Development Commission and the Public Utilities Commission, shall prepare an evaluation posted to the state board’s internet website by June 1, 2024. The evaluation shall include, but not be limited to, all the following:
(1)CA Health and Safety Code § 38561.8(b)(1) Policy recommendations regarding the use of hydrogen, and specifically regarding the use of green hydrogen, in the state to help achieve the state’s climate, clean energy, and clean air objectives. The policy recommendations may include recommendations on how to overcome market barriers and accelerate progress in green hydrogen production, scaling and use, including through the use of public-private partnerships, demonstration projects undertaken by public, private, or nonprofit entities, or a combination thereof, incentives, financing mechanisms, or other policies, and recommendations to maximize economic, environmental, public health, workforce, and equity benefits resulting from increased utilization of green hydrogen.
(2)CA Health and Safety Code § 38561.8(b)(2) A description of strategies, consistent with the state’s climate, clean energy, and clean air requirements, supporting hydrogen infrastructure, including needed infrastructure for production, processing, delivery, storage, and end uses in difficult-to-decarbonize sectors of the economy for the purpose of preparing infrastructure and end uses for green hydrogen deployment. This description shall identify policies that promote the reduction of economywide emissions of greenhouse gases and short-lived climate pollutants through the deployment of hydrogen, including green hydrogen, while ensuring that hydrogen infrastructure will support the employment of a skilled and trained workforce in California to perform that work.
(3)CA Health and Safety Code § 38561.8(b)(3) A description of the potential for other forms of hydrogen, outside of green hydrogen, to achieve emission reductions that can contribute to achieving the state’s climate, clean energy, and clean air objectives.
(4)CA Health and Safety Code § 38561.8(b)(4) An analysis of how curtailed electrical generation could be better utilized to help meet the goals set forth in this division, including, but not limited to, whether curtailed electrical generation could be made available for the production of green hydrogen. The state board shall also consult with the Independent System Operator in the preparation of the analysis.
(5)CA Health and Safety Code § 38561.8(b)(5) An estimate of the amount of reduced emissions of greenhouse gases and air quality benefits the state could achieve through deploying green hydrogen through a variety of scenarios, the costs associated with using green hydrogen, and the associated health and environmental impacts of prioritizing the development of various forms of hydrogen, when compared to other alternatives.
(6)CA Health and Safety Code § 38561.8(b)(6) An analysis of the potential for opportunities to integrate hydrogen, including green hydrogen, production and application with drinking water supply treatment needs, particularly for advanced treatment water supplies such as desalination, potable reuse, and salt and contaminant removal projects.
(7)CA Health and Safety Code § 38561.8(b)(7) Policy recommendations for regulatory and permitting processes associated with transmission and distribution of hydrogen, including green hydrogen, from production sites to end uses.
(8)CA Health and Safety Code § 38561.8(b)(8) An analysis of the life-cycle greenhouse gas emissions from various forms of hydrogen, including green hydrogen, production.
(9)CA Health and Safety Code § 38561.8(b)(9) An analysis of air pollution and other environmental impacts from hydrogen, including green hydrogen, distribution and end uses.
(c)CA Health and Safety Code § 38561.8(c) In developing the evaluation pursuant to subdivision (b), the state board shall consult the California Workforce Development Board and labor and workforce organizations, including those that administer state-approved apprenticeship programs that train workers to construct, install, and maintain hydrogen infrastructure.

Section § 38562

Explanation

This law requires the state board to set limits and create measures to reduce greenhouse gas emissions as much as technology allows and in a cost-effective way. The regulations should aim for fairness, minimize costs, maximize benefits, and support early emissions reduction actions. Additionally, the rules should prevent disproportionate impacts on low-income communities and credit those who've voluntarily cut emissions earlier.

The board must ensure these regulations help maintain air quality standards and provide broad environmental and economic benefits. The board's decisions will be informed by the best available scientific and economic data. They must also work with the Public Utilities Commission to coordinate regulations for electricity and gas providers and avoid redundant rules.

This section is set to be active starting in 2046, but it allows revisions to be made to improve the regulations continually.

(a)CA Health and Safety Code § 38562(a) The state board shall adopt greenhouse gas emissions limits and emissions reduction measures by regulation to achieve the maximum technologically feasible and cost-effective reductions in greenhouse gas emissions to achieve the purposes of this division.
(b)CA Health and Safety Code § 38562(b) In adopting regulations pursuant to this section and Part 5 (commencing with Section 38570), to the extent feasible, to achieve the purposes of this division, the state board shall do all of the following:
(1)Copy CA Health and Safety Code § 38562(b)(1)
(A)Copy CA Health and Safety Code § 38562(b)(1)(A) Design the regulations, including distribution of emissions allowances where appropriate, in a manner that is equitable, seeks to minimize costs and maximize the total benefits to California, and encourages early action to reduce greenhouse gas emissions.
(B)Copy CA Health and Safety Code § 38562(b)(1)(A)(B)
(i)Copy CA Health and Safety Code § 38562(b)(1)(A)(B)(i) Design the regulations, including distribution of emissions allowances where appropriate, in a manner that transitions support from gas corporations to electrical distribution utilities, as defined in Section 95802 of Title 17 of the California Code of Regulations, on or before January 1, 2031, to minimize ratepayer impacts and achieve the purposes of this division.
(ii)CA Health and Safety Code § 38562(b)(1)(A)(B)(i)(ii) For purposes of this subparagraph, “gas corporation” has the same meaning as set forth in Section 222 of the Public Utilities Code.
(iii)CA Health and Safety Code § 38562(b)(1)(A)(B)(i)(iii) Except as provided in clause (i), this subparagraph shall not be construed to impact the distribution of emissions allowances to emissions-intensive, trade-exposed industrial sectors.
(2)CA Health and Safety Code § 38562(b)(2) Ensure that activities undertaken to comply with the regulations do not disproportionately impact low-income communities.
(3)CA Health and Safety Code § 38562(b)(3) Ensure that entities that have voluntarily reduced their greenhouse gas emissions before the implementation of this section receive appropriate credit for early voluntary reductions.
(4)CA Health and Safety Code § 38562(b)(4) Ensure that activities undertaken pursuant to the regulations complement, and do not interfere with, efforts to achieve and maintain federal and state ambient air quality standards and to reduce toxic air contaminant emissions.
(5)CA Health and Safety Code § 38562(b)(5) Consider cost-effectiveness of these regulations.
(6)CA Health and Safety Code § 38562(b)(6) Consider overall societal benefits, including reductions in other air pollutants, diversification of energy sources, and other benefits to the economy, environment, and public health.
(7)CA Health and Safety Code § 38562(b)(7) Consider the effect of these regulations on affordability, cost-effectiveness, minimization of leakage in California, and achieving the purposes of this division.
(8)CA Health and Safety Code § 38562(b)(8) Minimize the administrative burden of implementing and complying with these regulations.
(9)CA Health and Safety Code § 38562(b)(9) Minimize leakage.
(10)CA Health and Safety Code § 38562(b)(10) Consider the significance of the contribution of each source or category of sources to statewide emissions of greenhouse gases.
(c)CA Health and Safety Code § 38562(c) To achieve the purposes of this division, the state board shall adopt a regulation that establishes a system of market-based declining annual aggregate emissions limits for sources or categories of sources that emit greenhouse gases, applicable from January 1, 2012, to December 31, 2045, inclusive, that the state board determines will achieve the maximum technologically feasible and cost-effective reductions in greenhouse gas emissions, in the aggregate, from those sources or categories of sources, and ensures that programwide aggregate emissions from covered sources, at a minimum, decline in line with the purposes of this division.
(d)CA Health and Safety Code § 38562(d) Any regulation adopted by the state board pursuant to this part or Part 5 (commencing with Section 38570) shall ensure all of the following:
(1)CA Health and Safety Code § 38562(d)(1) The greenhouse gas emission reductions achieved are real, permanent, quantifiable, verifiable, and enforceable by the state board.
(2)CA Health and Safety Code § 38562(d)(2) For regulations pursuant to Part 5 (commencing with Section 38570), the reduction is in addition to any greenhouse gas emission reduction otherwise required by law or regulation, and any other greenhouse gas emission reduction that otherwise would occur.
(3)CA Health and Safety Code § 38562(d)(3) If applicable, the greenhouse gas emission reduction occurs over the same time period and is equivalent in amount to any direct emission reduction required pursuant to this division.
(e)CA Health and Safety Code § 38562(e) The state board shall rely upon the best available economic and scientific information and its assessment of existing and projected technological capabilities when adopting the regulations required by this section.
(f)CA Health and Safety Code § 38562(f) The state board shall consult with the Public Utilities Commission in the development of the regulations as they affect electricity and natural gas providers in order to minimize duplicative or inconsistent regulatory requirements.
(g)CA Health and Safety Code § 38562(g) The state board may revise regulations adopted pursuant to this section and adopt additional regulations to further the provisions of this division.
(h)CA Health and Safety Code § 38562(h) This section shall become operative on January 1, 2046.

Section § 38562.1

Explanation

This law requires the state board, when updating major market-based compliance regulations related to climate policies, to present their plan and reasoning to specific legislative committees. They must discuss the current state of the regulations and explain why changes are needed. The board must also provide economic analyses to these committees and potentially attend hearings if requested. They're also tasked with making the public agenda available before meetings on these updates. These steps ensure transparency and legislative oversight, but they don't delay the rulemaking process. This law is valid until January 1, 2046.

(a)CA Health and Safety Code § 38562.1(a) If the state board initiates a regulatory process to update the market-based compliance mechanism, consistent with Section 38562, that is expected to be a major regulation as defined in Section 11342.548 of the Government Code, the chairperson of the state board shall present to the Joint Legislative Committee on Climate Change Policies and other relevant policy committees of the Legislature on the current state of the market-based compliance mechanism and provide the rationale for updating the market-based compliance mechanism, including the specific issues that the update is meant to address. The presentation by the chairperson of the state board pursuant to this section shall satisfy the requirements of subdivision (b) of Section 9147.10 of the Government Code and subdivision (b) of Section 38531 of this code for the year in which the presentation occurs.
(b)CA Health and Safety Code § 38562.1(b) The state board shall transmit the economic analyses required by Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code for a regulatory process subject to subdivision (a) to the Joint Legislative Committee on Climate Change Policies and the relevant budget subcommittees. Within 30 days of that transmittal, if requested by the chair of the Joint Legislative Committee on Climate Change Policies or the chairs of the relevant policy committees or budget subcommittees of the Legislature, the chairperson of the state board shall make themselves available for a hearing on the proposed regulatory amendments.
(c)CA Health and Safety Code § 38562.1(c) The state board shall transmit to the Joint Legislative Committee on Climate Change Policies and other relevant policy committees of the Legislature the public agenda, when it is available, for the board meeting at which the amendments for a rulemaking under the regulatory process subject to subdivision (a) will be considered by the state board. If requested by the chair of the Joint Legislative Committee on Climate Change Policies or the chairs of the relevant policy committees or budget subcommittees of the Legislature, the chairperson of the state board shall make themselves available for a hearing on the amendments.
(d)CA Health and Safety Code § 38562.1(d) The legislative hearings and notifications in this section shall not delay the state board’s rulemaking process pursuant to Chapter 3.5 (commencing with Section 11340) of Part 1 of Division 3 of Title 2 of the Government Code.
(e)CA Health and Safety Code § 38562.1(e) This section shall remain in effect only until January 1, 2046, and as of that date is repealed.

Section § 38562.2

Explanation

This law is called the California Climate Crisis Act, and it aims to address climate change by reducing greenhouse gas emissions. The state's goal is to reach net zero emissions by 2045 and to decrease emissions by at least 85% from levels set earlier. This does not replace existing emissions targets but adds to them. The state board and other agencies will create and use strategies for carbon removal and capture technologies to support these goals. By 2035, the state board will review how feasible and effective these goals are compared to other possible scenarios and report to the Legislature. Additionally, there will be yearly reports to track progress and offer improvement suggestions, ensuring transparency and accountability.

(a)CA Health and Safety Code § 38562.2(a) This section shall be known, and may be cited, as the California Climate Crisis Act.
(b)CA Health and Safety Code § 38562.2(b) For purposes of this section, “net zero greenhouse gas emissions” means emissions of greenhouse gases, as defined in subdivision (g) of Section 38505, to the atmosphere are balanced by removals of greenhouse gas emissions over a period of time, as determined by the state board.
(c)CA Health and Safety Code § 38562.2(c) It is the policy of the state to do both of the following:
(1)CA Health and Safety Code § 38562.2(c)(1) Achieve net zero greenhouse gas emissions as soon as possible, but no later than 2045, and to achieve and maintain net negative greenhouse gas emissions thereafter. This goal is in addition to, and does not replace or supersede, the statewide greenhouse gas emissions reduction targets in Section 38566.
(2)CA Health and Safety Code § 38562.2(c)(2) Ensure that by 2045, statewide anthropogenic greenhouse gas emissions are reduced to at least 85 percent below the statewide greenhouse gas emissions limit established pursuant to Section 38550.
(d)CA Health and Safety Code § 38562.2(d) The state board shall work with relevant state agencies to do both of the following:
(1)CA Health and Safety Code § 38562.2(d)(1) Ensure that updates to the scoping plan required pursuant to Section 38561 identify and recommend measures to achieve the policy goals stated in subdivision (c).
(2)CA Health and Safety Code § 38562.2(d)(2) Identify and implement a variety of policies and strategies that enable carbon dioxide removal solutions and carbon capture, utilization, and storage technologies in California to complement emissions reductions and achieve the policy goals stated in subdivision (c).
(e)Copy CA Health and Safety Code § 38562.2(e)
(1)Copy CA Health and Safety Code § 38562.2(e)(1) By December 31, 2035, the state board shall evaluate the feasibility and tradeoffs of achieving the policy goal stated in paragraph (2) of subdivision (c) relative to alternative scenarios that achieve the policy goals stated in paragraph (1) of subdivision (c), and report its findings and recommendations to the Legislature.
(2)CA Health and Safety Code § 38562.2(e)(2) The state board shall report to the Joint Legislative Committee on Climate Change Policies annually on progress toward the goals stated in subdivision (c).
(3)CA Health and Safety Code § 38562.2(e)(3) As part of its annual reporting requirements pursuant to Section 38592.6, the Legislative Analyst’s Office, until January 1, 2030, shall conduct independent analyses of the state’s progress toward the goals stated in subdivision (c) and shall prepare an annual report detailing its review, which may include recommendations for improvements in state actions taken to achieve the goals stated in subdivision (c). When appropriate, these annual reports may incorporate reviews of the state board’s evaluation and reporting practices, and may include recommendations for potential changes to advance transparency and accountability. A report prepared pursuant to this paragraph shall be made available to the public.

Section § 38562.3

Explanation

This law requires the California state board to conduct a study and report back to the Legislature by the end of 2026 on how offset projects contribute to the state's climate goals and how these projects could be improved or valued differently. This includes examining the possibility of redefining what constitutes direct environmental benefits within California and offering recommendations on developing more in-state offset projects. The board must also update existing offset protocols by 2029 to ensure they align with the best available science and practices from global carbon markets and the Paris Agreement.

Starting January 2034, and every five years after, the board needs to evaluate these offset protocols to ensure they’re still using the latest scientific standards.

(a)Copy CA Health and Safety Code § 38562.3(a)
(1)Copy CA Health and Safety Code § 38562.3(a)(1) No later than December 31, 2026, the state board shall conduct a study and report to the Legislature, in accordance with Section 9795 of the Government Code, on all of the following related to offsets:
(A)CA Health and Safety Code § 38562.3(a)(1)(A) Evaluation of the contribution of offset projects to progress toward California’s climate goals.
(B)CA Health and Safety Code § 38562.3(a)(1)(B) Evaluation of the potential for changes to the definition of “direct environmental benefits in the state” for purposes of subparagraph (E) of paragraph (2) of subdivision (c) of Section 38562.
(C)CA Health and Safety Code § 38562.3(a)(1)(C) Recommendations on how instate offset projects could be more attractive for development.
(D)CA Health and Safety Code § 38562.3(a)(1)(D) Recommendations for alternative valuation methodologies or criteria for instate offset projects, particularly projects that support the goals of Section 38561.5 of this code or subdivision (b) of Section 71450 of the Public Resources Code.
(2)CA Health and Safety Code § 38562.3(a)(2) Pursuant to Section 10231.5 of the Government Code, this subparagraph shall become inoperative on December 31, 2030.
(b)CA Health and Safety Code § 38562.3(b) No later than January 1, 2029, the state board shall update all existing compliance offset protocols to ensure that the compliance offset protocols reflect the best available science, including, but not limited to, consideration of compliance offset protocols in other carbon markets, crediting mechanisms established under Article 6.4 of the Paris Agreement adopted by the United Nations Climate Change Conference (COP21) in Paris, France, on December 12, 2015, also known as the Paris Agreement Crediting Mechanism, academic research, and industry best practices, that prioritize offset quality.
(c)CA Health and Safety Code § 38562.3(c) No later than January 1, 2034, and every five years thereafter, the state board shall evaluate all compliance offset protocols and consider whether updates are necessary to ensure that the compliance offset protocols reflect the best available science, including consideration of items specified in subdivision (b).

Section § 38562.4

Explanation

This section outlines the definitions and overall goal for California state agencies to achieve net-zero greenhouse gas emissions by January 1, 2035. 'Scope 1 emissions' refer to direct emissions from agency-controlled sources, while 'Scope 2 emissions' involve indirect emissions from purchased energy.

The Department of General Services, in coordination with the State Air Resources Board, is tasked with tracking progress towards this goal. Key requirements include publishing annual emission inventories starting July 1, 2024, and creating a detailed action plan by January 1, 2026, with updates every two years thereafter. These actions should be included in state agencies’ sustainability plans and budget proposals.

Additionally, the Department of General Services must provide support and resources to state agencies and report biennially to the Legislature about emissions progress and existing challenges, suggesting legislative actions to remove barriers.

(a)CA Health and Safety Code § 38562.4(a) For purposes of this section, the following definitions apply:
(1)CA Health and Safety Code § 38562.4(a)(1) “Scope 1 emissions” means all direct emissions from sources that are owned or controlled by the state agency, including, but not limited to, emissions from onsite fossil fuel combustion and fleet fuel consumption.
(2)CA Health and Safety Code § 38562.4(a)(2) “Scope 2 emissions” means all indirect emissions from sources that are owned or controlled by the state agency, including, but not limited to, emissions that result from the generation of electricity, heat, or steam purchased by the state agency from a utility provider.
(3)CA Health and Safety Code § 38562.4(a)(3) “State agency” means any state agency, board, department, or commission.
(b)CA Health and Safety Code § 38562.4(b) It is the intent of the Legislature that all state agencies aim to achieve net-zero emissions of greenhouse gases resulting from their operations, including scope 1 and scope 2 emissions, no later than January 1, 2035, or as soon as feasible thereafter.
(c)CA Health and Safety Code § 38562.4(c) In making progress toward the goal set forth in subdivision (b), the Department of General Services, in consultation with the State Air Resources Board, shall, to the extent feasible, do all of the following:
(1)CA Health and Safety Code § 38562.4(c)(1) On or before July 1, 2024, and annually thereafter until the goal set forth in subdivision (b) has been achieved, publish on its internet website or other publicly available location, an inventory of the greenhouse gas emissions of state agencies for the prior calendar year.
(2)CA Health and Safety Code § 38562.4(c)(2) On or before January 1, 2026, develop and publish, on its internet website or other publicly available location, a plan that describes required actions and investments for achieving the goal set forth in subdivision (b) and an estimate of the costs associated with the required actions and investments.
(3)CA Health and Safety Code § 38562.4(c)(3) Beginning June 30, 2028, and every two years thereafter until the goal set forth in subdivision (b) has been achieved, develop and publish, on its internet website or other publicly available location, an updated plan that includes a description of state agencies’ progress, and any changes to the required actions and investments, toward achieving the goal set forth in subdivision (b).
(4)CA Health and Safety Code § 38562.4(c)(4) Ensure that the required actions and investments identified pursuant to paragraphs (2) and (3) are incorporated into the sustainability roadmaps of all state agencies.
(5)CA Health and Safety Code § 38562.4(c)(5) Subject to an appropriation by the Legislature, provide information, training, coordination, best practices, and other technical assistance to state agencies to help those state agencies implement the required actions and investments identified pursuant to paragraphs (2) and (3).
(d)CA Health and Safety Code § 38562.4(d) State agencies shall incorporate the required actions and investments identified pursuant to subdivision (c) into their future budget proposals, subject to appropriation by the Legislature, in order to achieve the goal set forth in subdivision (b).
(e)CA Health and Safety Code § 38562.4(e) Beginning December 31, 2027, and every two years thereafter, until the goal set forth in subdivision (b) is achieved, the Department of General Services shall report to the Legislature on the progress toward achieving that goal, including on both of the following:
(1)CA Health and Safety Code § 38562.4(e)(1) The overall greenhouse gas emissions from all state agencies and a summary of actions taken by state agencies since the submission of the last report.
(2)CA Health and Safety Code § 38562.4(e)(2) Barriers that are hindering progress and suggested actions that the Legislature could take to reduce those barriers.

Section § 38562.5

Explanation

This section requires the state board to adopt rules aimed at reducing emissions beyond set limits, especially in communities most affected by pollution.

They must follow related requirements, account for the societal costs of emissions, and focus on creating regulations that lead to direct emission cuts. Priority is given to reducing emissions from large stationary and mobile sources, as well as other types of sources.

When adopting rules and regulations pursuant to this division to achieve emissions reductions beyond the statewide greenhouse gas emissions limit and to protect the state’s most impacted and disadvantaged communities, the state board shall follow the requirements in subdivision (b) of Section 38562, consider the social costs of the emissions of greenhouse gases, and prioritize both of the following:
(a)CA Health and Safety Code § 38562.5(a) Emission reduction rules and regulations that result in direct emission reductions at large stationary sources of greenhouse gas emissions and direct emission reductions from mobile sources.
(b)CA Health and Safety Code § 38562.5(b) Emission reduction rules and regulations that result in direct emission reductions from sources other than those specified in subdivision (a).

Section § 38562.7

Explanation

When updating a scoping plan for emissions, it's important to include detailed information for each emissions reduction method. This includes predicting how much the measure will reduce greenhouse gases and other air pollution. The update should also show how cost-effective the measure is, considering both direct costs and the broader benefits to society.

Each scoping plan update developed pursuant to Section 38561 shall identify for each emissions reduction measure, including each alternative compliance mechanism, market-based compliance mechanism, and potential monetary and nonmonetary incentive, the following information:
(a)CA Health and Safety Code § 38562.7(a) The range of projected greenhouse gas emissions reductions that result from the measure.
(b)CA Health and Safety Code § 38562.7(b) The range of projected air pollution reductions that result from the measure.
(c)CA Health and Safety Code § 38562.7(c) The cost-effectiveness, including avoided social costs, of the measure.

Section § 38563

Explanation

This law allows the state board to set and enforce rules to reduce greenhouse gas emissions before the specified dates of January 1, 2011, and January 1, 2012. It also enables the board to give credits for early efforts in reducing emissions when suitable.

Nothing in this division restricts the state board from adopting greenhouse gas emission limits or emission reduction measures prior to January 1, 2011, imposing those limits or measures prior to January 1, 2012, or providing early reduction credit where appropriate.

Section § 38564

Explanation

This section requires the state board to work with other states, the federal government, and other countries to find the best ways to cut greenhouse gases. The goal is to create efficient and affordable programs at regional, national, and international levels.

The state board shall consult with other states, and the federal government, and other nations to identify the most effective strategies and methods to reduce greenhouse gases, manage greenhouse gas control programs, and to facilitate the development of integrated and cost-effective regional, national, and international greenhouse gas reduction programs.

Section § 38565

Explanation

This law requires the state board to ensure that efforts to reduce greenhouse gas emissions benefit the most disadvantaged communities in California. It also emphasizes involving small businesses, schools, affordable housing groups, and other community institutions in these initiatives where possible.

The state board shall ensure that the greenhouse gas emission reduction rules, regulations, programs, mechanisms, and incentives under its jurisdiction, where applicable and to the extent feasible, direct public and private investment toward the most disadvantaged communities in California and provide an opportunity for small businesses, schools, affordable housing associations, and other community institutions to participate in and benefit from statewide efforts to reduce greenhouse gas emissions.

Section § 38566

Explanation

This law requires that when creating rules to cut down on greenhouse gases, the state board must make sure that by the end of 2030, the emissions are at least 40% lower than a set limit. The focus is on doing this in a way that's both technologically possible and cost-effective.

In adopting rules and regulations to achieve the maximum technologically feasible and cost-effective greenhouse gas emissions reductions authorized by this division, the state board shall ensure that statewide greenhouse gas emissions are reduced to at least 40 percent below the statewide greenhouse gas emissions limit no later than December 31, 2030.

Section § 38568

Explanation

This law requires the California Air Resources Board (CARB) to improve its greenhouse gas reduction incentive programs if funding is available. CARB must identify overlaps in its programs, collect data on how each program influences behavior, and evaluate the social benefits they provide. They are to contract with a university to gather necessary data for analysis. CARB will use this information to refine emissions estimates and improve program funding and design. These tasks must be completed within three years once funding from the Legislature is received. The term 'incentive program' refers to specific programs included in a state audit report focused on climate change goals.

(a)CA Health and Safety Code § 38568(a) Contingent upon appropriation by the Legislature, to better assist the state in achieving its greenhouse gas emissions reduction goals, the state board shall do all of the following with respect to incentive programs administered by the state board:
(1)CA Health and Safety Code § 38568(a)(1) To improve the state board’s ability to isolate the greenhouse gas emissions reductions for each of its incentive programs, the state board shall establish a process to formally identify any overlap among any incentive programs that share the same objectives.
(2)CA Health and Safety Code § 38568(a)(2) To improve its ability to identify the effectiveness of each of its incentive programs in reducing greenhouse gas emissions, the state board shall develop a process to define, collect, and evaluate data on the behavioral changes that result from each of its incentive programs.
(3)CA Health and Safety Code § 38568(a)(3) To better demonstrate that its incentive programs are as effective as possible in achieving specific socioeconomic benefits, the state board shall develop a process to define, collect, and evaluate data that will translate to metrics demonstrating the socioeconomic benefits that result from each of its incentive programs.
(4)CA Health and Safety Code § 38568(a)(4) The state board shall enter into a contract with either the University of California or the California State University to collect the information necessary to better isolate greenhouse gas emission reductions and socioeconomic benefits ascribed to its incentive programs. The findings from that contract shall inform the processes and methodologies implemented by the state board.
(5)Copy CA Health and Safety Code § 38568(a)(5)
(A)Copy CA Health and Safety Code § 38568(a)(5)(A) The state board shall use the information collected pursuant to paragraphs (1) and (2) to refine any greenhouse gas emissions estimates of its incentive programs that are included in its annual reports to the Legislature, funding plans, or any long-term planning documents or reports.
(B)CA Health and Safety Code § 38568(a)(5)(A)(B) The state board shall use the metrics and data collected pursuant to paragraph (3) to make any funding and design recommendations in its annual reports to the Legislature or funding plans based on the efficacy and costs of its incentive programs in providing socioeconomic benefits.
(b)CA Health and Safety Code § 38568(b) The state board shall complete the requirements of paragraphs (1) to (4), inclusive, of subdivision (a) within three years of receiving an appropriation from the Legislature for the purposes of this section.
(c)CA Health and Safety Code § 38568(c) For purposes of this section, “incentive program” means an incentive program administered by the state board that is included in the audit entitled “California Air Resources Board: Improved Program Measurement Would Help California Work More Strategically to Meet Its Climate Change Goals” (Report Number 2020-114) conducted by the California State Auditor.