Ag Council Opposes Measure that would Increase Energy Costs and Lead to Unreliable Supplies
June 30, 2015
The Honorable Anthony Rendon
Chair, Assembly Utilities and Commerce Committee
California State Capitol, Room 5136
Sacramento, CA 95814
Re: SB 350 (De León) – OPPOSE
Dear Assembly Member Rendon:
The below-listed organizations OPPOSE SB 350, as introduced February 24, 2015, that gives blank check authority to the California Air Resources Board (ARB), California Public Utilities Commission (PUC) and California Energy Commission, to adopt a series of goals for dramatically reducing petroleum-based fuel use and increasing renewable energy procurement and building energy efficiency in a short 15 years.
SB 350 requires the State Air Resources Board (ARB), California Public Utilities Commission (CPUC) and the Energy Commission to adopt and implement undefined policies in pursuit of:
- 50 percent reduction in the use of petroleum-based fuels;
- 50 percent of electrical power generation from renewable sources; and
- 50 percent reduction in energy use by existing buildings.
By imposing a series of sector-specific goals, SB 350 takes California further from the well-designed Cap-and-Trade system that most economists believe is the most cost-effective way for California and the world to reduce global GHG emissions. By taking a more costly approach, the resulting increase in energy and fuel costs will lead to a leakage of emissions and jobs to other states and nations.
50 percent petroleum reduction would cost jobs and threaten tax revenues for roads:
Without a cost-effective and technologically feasible way to achieve this goal, we are very concerned about the negative effect on jobs and the increasing cost of goods movement for industry. SB 350 does not provide any guidance to the ARB other than the direction to achieve the goal, potentially at any cost. To make a bad situation worse, SB 350 exacerbates California’s existing lack of a sustainable transportation funding system by cutting into our primary road funding source.
Higher renewable energy targets will threaten affordability and reliability: Simply mandating more renewables jeopardizes the affordable, reliable energy upon which California businesses depend. First and foremost of concern is the intermittency of most renewable energy sources, including solar and wind, which place their peak generation outside of the times of highest demand. This high degree of intermittency also creates challenges regarding what to do with over-generation and the need for backup power generation (peaking) when the sun does not shine as much or the wind does not blow as strongly as anticipated.
Energy efficiency targets must account for steps already taken: California businesses remain the most efficient in the world simply out of decades of necessity in order to maintain productivity and profitability. Doing more with less has long been way to remain competitive in California. However, SB 350 sets another major goal in reducing energy use of existing buildings, but does not provide any detail in how California will get to this goal nor does it account for steps businesses have already taken.
Bottom line: SB 350 threatens both the public and private sector with higher energy costs and unreliable supplies.
The below-listed organizations OPPOSE SB 350.
Sincerely,
Agricultural Council of California
Associated Builders and Contractors of California
California Association of Nurseries and Garden Centers
California Cotton Ginners Association
California Cotton Growers Association
California Dairies, Inc.
California Farm Bureau Federation
California Fresh Fruit Association
California Manufacturers & Technology Association
California Retailers Association
Family Business Association
Far West Equipment Dealers Association
National Federation of Independent Business
National Tank Truck Carriers
Western Aerosol Information Bureau
Western Agricultural Processors Association
cc: Senate President pro Tempore, Kevin de León
Martha Guzman-Aceves, Office of Governor Edmund G. Brown, Jr.
Sue Kateley, Assembly Utilities and Commerce Committee
Daryl Thomas, Assembly Republican Caucus