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SB-781 Methane emissions: natural gas producing low methane emissions.(2023-2024)



Current Version: 06/28/23 - Amended Assembly

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SB781:v95#DOCUMENT

Amended  IN  Assembly  June 28, 2023
Amended  IN  Assembly  June 19, 2023
Amended  IN  Senate  May 01, 2023
Amended  IN  Senate  April 10, 2023

CALIFORNIA LEGISLATURE— 2023–2024 REGULAR SESSION

Senate Bill
No. 781

Introduced by Senator Stern

February 17, 2023

An act to amend Sections 38592 and 39607 of the Health and Safety Code, relating to greenhouse gases.


LEGISLATIVE COUNSEL'S DIGEST


SB 781, as amended, Stern. Methane emissions: natural gas producing low methane emissions.
The California Global Warming Solutions Act of 2006 designates the State Air Resources Board as the state agency responsible for monitoring and regulating sources of emissions of greenhouse gases that cause global warming in order to reduce emissions of greenhouse gases. The act requires all state agencies to consider and implement strategies to reduce their greenhouse gas emissions.
This bill would additionally require state agencies to prioritize strategies to reduce methane emissions, including emissions from imported natural gas, where feasible and cost effective. The bill would require the state board, no later than December 31, 2024, to establish a certification standard for natural gas producing low methane emissions. The bill would require the state board to encourage natural gas procurement on behalf of the state to shift to certified natural gas producing low methane emissions. The bill would also require the state board, the Public Utilities Commission, and other relevant agencies to timely consider programs, or changes to existing programs, to reduce methane emissions, including emissions from imported natural gas procured by utilities and other large gas users.
Existing law requires the state board to inventory sources of air pollution within the air basins of the state and determine the kinds and quantity of air pollutants. Existing law requires the state board to make available, and update at least annually, on its internet website the emissions of greenhouse gases, criteria air pollutants, and toxic air contaminants for each facility that reports to the state board and air pollution control and air quality management districts as well as the emissions of greenhouse gases, criteria air pollutants, and toxic air contaminants throughout the state broken down to a local and subcounty level for stationary sources and to at least a county level for mobile sources, as specified. Existing law also requires the state board to quantify and publish annually the amount of greenhouse gas emissions resulting from the loss or release of uncombusted natural gas to the atmosphere and emissions from natural gas flares during all processes associated with the production, processing, and transporting of natural gas imported into the state from out-of-state sources.
This bill would require the state board to annually request and incorporate, as part of this quantification for annual publication, information from utilities and other large gas users regarding any contract for and use of natural gas certified to have a methane emissions intensity of less than 0.2% across the natural gas supply chain, as data are available, or the use of other best practices to minimize emissions of methane and greenhouse gases from natural gas supplying California. The bill would also require the state board to quantify and publish annually, commencing January 1, 2025, an estimate of potential greenhouse gas emissions reductions associated with the use of natural gas certified to have a methane emissions intensity of less than 0.2% across the natural gas supply chain, as data are available, or the use of other best practices applied to natural gas supplies to California.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

The people of the State of California do enact as follows:


SECTION 1.

 (a) The Legislature finds and declares all of the following:
(1) According to the United States Environmental Protection Agency, methane is a potent short-lived climate pollutant with an estimated global warming impact of 27 to 30 times that of carbon dioxide over 100 years and 81 to 83 times that of carbon dioxide over 20 years.
(2) The State Air Resources Board’s Short-Lived Climate Pollutant (SLCP) Reduction Strategy, developed pursuant to Section 39730 of the Health and Safety Code, states that “[the] science unequivocally underscores the need to immediately reduce emissions of Short-Lived Climate Pollutants” and highlights a broad array of significant climate, health, and economic benefits associated with quick action to reduce SLCP emissions from all addressable sources.
(3) The SLCP Reduction Strategy and subsequent state actions have implemented strategies to reduce methane from a wide array of sources in California, including the oil and gas sector. However, the strategy notes that about 90 percent of the state’s natural gas use is supplied by out-of-state sources, and notes that more may need to be done to address emissions from these sources.
(4) In “Out-of-State Greenhouse Gas Emissions From Loss, Release, and Flaring of Natural Gas Imported to California: 2018-20,” the State Air Resources Board estimates that fugitive methane emissions from out-of-state sources of natural gas supplying California in 2020 were the equivalent of 9,100,000 metric tons of carbon dioxide. The report recognizes that the methods likely underestimate methane emissions associated with California’s gas supply, but even based on this estimate, methane from out-of-state natural gas production would represent the second largest source of methane emissions in California, and a greater source of methane than emissions from landfills or oil and gas production, processing, and distribution in California.
(5) Existing climate change policies in California incentivize greenhouse gas emissions reductions from imported electricity and transportation fuels; however, no similar policy exists for natural gas, which is almost entirely imported. Emissions from this source are readily addressable using best management practices and in line with California regulations for oil and gas production.
(6) Incentivizing greenhouse gas emissions reductions from natural gas supplies to California will help to expand the use of best practices and reduce methane emissions associated with not only California’s energy use, but other states, as well.
(7) California’s scoping plan and carbon neutrality goals set forth in Section 38562.2 of the Health and Safety Code require a rapid transition away from fossil fuels, including fossil-based natural gas, to clean energy. Near-term efforts to reduce methane emissions from natural gas supplies will support California’s climate change priorities and its transition away from fossil-based energy.
(b) It is the intent of the Legislature that California take steps to reduce methane emissions associated with natural gas imported and used in the state in a manner that supports efforts to reduce the use and reliance on fossil fuels and the state’s transition to clean energy.

SEC. 2.

 Section 38592 of the Health and Safety Code is amended to read:

38592.
 (a) All state agencies shall consider and implement strategies to reduce their greenhouse gas emissions.
(b) State agencies shall prioritize strategies to reduce methane emissions, including emissions from imported natural gas, where feasible and cost effective.
(c) The state board, the Public Utilities Commission, and other relevant agencies shall timely consider programs, or changes to existing programs, to reduce methane emissions, including emissions from imported natural gas procured by utilities and other large gas users.
(d) No later than December 31, 2024, the state board shall establish a certification standard for natural gas producing low methane emissions. In developing the certification standard, the state board shall consider existing third-party natural gas certification standards that may be considered as natural gas with low methane.
(e) The state board shall encourage natural gas procurement on behalf of the state to shift to certified natural gas producing low methane emissions, where feasible, cost effective, and in the best interests of ratepayers as determined by the Public Utilities Commission pursuant to Section 740.8 of the Public Utilities Code and consistent with Section 451 of the Public Utilities Code.
(f) This section shall not be construed to require any new or additional natural gas utility procurement or to promote the expanded use of natural gas from fossil resources and is not intended to interfere with state efforts to reduce the use of natural gas or increase the production and use of renewable gas.
(g) This section division does not relieve any person, entity, or public agency of compliance with other applicable federal, state, or local laws or regulations, including state air and water quality requirements, and other requirements for protecting public health or the environment.

SEC. 3.

 Section 39607 of the Health and Safety Code is amended to read:

39607.
 The state board shall do all of the following:
(a) Establish a program to secure data on air quality in each air basin established by the state board.
(b) (1) Inventory sources of air pollution within the air basins of the state and determine the kinds and quantity of air pollutants, including, but not limited to, the contribution of natural sources, mobile sources, and area sources of emissions, including a separate identification of those sources not subject to district permit requirements, to the extent feasible and necessary to carry out the purposes of this chapter. The state board shall use, to the fullest extent, the data of local agencies and other state and federal agencies in fulfilling this purpose.
(2) Make available on the state board’s internet website the emissions of greenhouse gases, criteria air pollutants, and toxic air contaminants throughout the state broken down to a local and subcounty level for stationary sources and to at least a county level for mobile sources. The emissions reported shall include data on the emissions of criteria air pollutants and toxic air contaminants emitted by stationary sources as provided to the state board by districts. The information shall be displayed graphically and updated at least once a year.
(3) (A) Quantify and publish annually, commencing January 1, 2020, and based on the best available science and information, the amount of greenhouse gas emissions, expressed in metric tons of carbon dioxide equivalents, resulting from the loss or release of uncombusted natural gas to the atmosphere and emissions from natural gas flares during all processes associated with the production, processing, and transporting of natural gas that is imported into the state from out-of-state sources.
(B) As part of the quantification described in subparagraph (A), annually request and incorporate information from utilities and other large gas users regarding any contracts for and use of natural gas certified to have a methane emissions intensity of less than 0.2 percent across the natural gas supply chain, as data are available, or the use of other best practices to minimize emissions of methane and greenhouse gases from natural gas supplying California.
(C) Quantify and publish annually, commencing January 1, 2025, an estimate of potential greenhouse gas emissions reductions associated with the use of natural gas certified to have a methane emissions intensity of less than 0.2 percent across the natural gas supply chain, as data are available, or the use of other best practices applied to natural gas supplies to California.
(D) This paragraph does not expand, contract, or otherwise alter other requirements for greenhouse gas emissions reporting by sources or categories of sources or for the statewide greenhouse gas emissions limit.
(c) Monitor air pollutants in cooperation with districts and with other agencies to fulfill the purpose of this division.
(d) Adopt test procedures to measure compliance with its nonvehicular emission standards and those of districts.
(e) Establish and periodically review criteria for designating an air basin attainment or nonattainment for any state ambient air quality standard set forth in Section 70200 of Title 17 of the California Code of Regulations. In developing and reviewing these criteria, the state board shall consider instances where there is poor or limited ambient air quality data, and shall consider highly irregular or infrequent violations. The state board shall provide an opportunity for public comment on the proposed criteria, and shall adopt the criteria after a public hearing.
(f) Evaluate, in consultation with the districts and other interested parties, air quality-related indicators that may be used to measure or estimate progress in the attainment of state standards and establish a list of approved indicators. On or before July 1, 1993, the state board shall identify one or more air quality indicators to be used by districts in assessing progress as required by subdivision (b) of Section 40924. The state board shall continue to evaluate the prospective application of air quality indicators and, upon a finding that adequate air quality modeling capability exists, shall identify one or more indicators that may be used by districts in lieu of the annual emission reductions mandated by subdivision (a) of Section 40914. In no case shall any indicator be less stringent or less protective, on the basis of overall health protection, than the annual emission reduction requirement in subdivision (a) of Section 40914.
(g) Establish, not later than July 1, 1996, a uniform methodology that may be used by districts in assessing population exposure, including, but not limited to, reduction in exposure of districtwide subpopulations, such as children, the elderly, and persons with respiratory disease, to ambient air pollutants at levels above the state ambient air quality standards, for estimating reductions in population exposure for the purposes of Sections 40913, 40924, and 41503, and for the establishment of the means by which reductions in population exposures may be achieved. The methodology adopted pursuant to this subdivision shall be consistent with the federal Clean Air Act (42 U.S.C. Sec. 7401 et seq.), and with this division, including, but not limited to, Section 39610.