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<ns0:ActionText>INTRODUCED</ns0:ActionText>
<ns0:ActionDate>2026-02-11</ns0:ActionDate>
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<ns0:SessionYear>2025</ns0:SessionYear>
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<ns0:AuthorText authorType="LEAD_AUTHOR">Introduced by Assembly Member Papan</ns0:AuthorText>
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<ns0:Name>Papan</ns0:Name>
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<ns0:Title> An act to add Article 7 (commencing with Section 43875) to Chapter 4 of Part 5 of Division 26 of the Health and Safety Code, relating to air resources. </ns0:Title>
<ns0:RelatingClause>air resources</ns0:RelatingClause>
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<ns0:Subject>Decarbonized gaseous fuels.</ns0:Subject>
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<html:p>Existing law regulates the emission of air contaminants, including the oxides of nitrogen, into the atmosphere. Existing law generally vests regulatory jurisdiction over stationary sources of air pollution to the air pollution control districts and air quality management districts and regulatory jurisdiction over mobile sources of air pollution to the State Air Resources Board.</html:p>
<html:p>This bill would require, on or before December 31, 2027, the state board to conduct an assessment of the amount of decarbonized gaseous fuels that will be needed to decarbonize hard-to-electrify sectors and maintain reliability in the electricity sector. The bill would require the assessment to include an assessment of the need for decarbonized gaseous fuels in each hard-to-electrify sector. The bill would require the state board to ensure, among other things, that policies
and incentives to decarbonize hard-to-electrify sectors are performance-based and technology neutral, and that entities that are regulated under the Cap-and-Invest Program shall have a lesser compliance obligation commensurate with purchases of decarbonized gas. The bill would also require the state board, in recommending the policies and incentives, to consider, among other things, how to incentivize the increased production and use of decarbonized gas instate and how to maximize the benefits of decarbonized gas production and use, as provided.</html:p>
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<ns0:FiscalCommittee>YES</ns0:FiscalCommittee>
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<ns0:Preamble>The people of the State of California do enact as follows:</ns0:Preamble>
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<ns0:Num>SECTION 1.</ns0:Num>
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Article 7 (commencing with Section 43875) is added to Chapter 4 of Part 5 of Division 26 of the
<ns0:DocName>Health and Safety Code</ns0:DocName>
, to read:
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<ns0:Num>7.</ns0:Num>
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<ns0:LawHeadingText>Decarbonized Gaseous Fuels</ns0:LawHeadingText>
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<ns0:Num>43875.</ns0:Num>
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<html:p>The Legislature finds and declares all of the following:</html:p>
<html:p>
(a)
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To meet California’s climate targets, all sectors of the economy will need to decarbonize.
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<html:p>
(b)
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While California has made significant progress increasing the use of renewable electricity and low-carbon transportation fuels, little progress has been made to decarbonize hard-to-electrify sectors of the economy.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
California has increased the procurement of renewable electricity substantially since the first renewables portfolio standard was enacted, but has only reduced natural gas used for electricity generation by 3 percent and has seen a rapid increase in diesel backup
generators for electricity reliability.
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<html:p>
(d)
<html:span class="EnSpace"/>
Decarbonizing hard-to-electrify sectors and the electricity sector itself will require quickly increasing the production and use of decarbonized gas, sustainable aviation and shipping fuels, and other decarbonized fuels.
</html:p>
<html:p>
(e)
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The 2022 climate change scoping plan calls for significant increases in the production and use of decarbonized hydrogen and bioenergy to decarbonize hard-to-electrify end uses and provide carbon negative emissions needed to reach the state’s goal of carbon neutrality by midcentury.
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<html:p>
(f)
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It is the intent of the Legislature to develop additional policies and incentives to accelerate the production and use of decarbonized gas and other low-carbon fuels for use in hard-to-electrify sectors and for electricity reliability.
</html:p>
<html:p>
(g)
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Increasing the production and use of low-carbon gas will protect public health by reducing air and water pollution from fossil fuels, especially the particulate matter and toxic air contaminant emissions from diesel.
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(h)
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Increasing the production of low-carbon fuels generated from organic waste may also help to mitigate wildfires, meet the landfill diversion requirements of Section 39730.6, and meet the methane and black carbon reduction requirements of Section 39730.5.
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<ns0:Num>43875.1.</ns0:Num>
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<html:p>
(a)
<html:span class="EnSpace"/>
On or before December 31, 2027, the state board shall conduct an assessment of the amount of decarbonized gaseous fuels that will be needed to decarbonize hard-to-electrify sectors and maintain reliability in the electricity sector. That assessment shall include all of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
An assessment of the need for decarbonized gaseous fuels in each hard-to-electrify sector.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
An assessment of the need for decarbonized gaseous fuels for electricity reliability.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Recommended policies and incentives to accelerate the production and use of decarbonized gaseous fuels.
</html:p>
<html:p>
(4)
<html:span class="EnSpace"/>
An assessment of opportunities to use agricultural and forest residues to help decarbonize hard-to-electrify sectors.
</html:p>
<html:p>
(b)
<html:span class="EnSpace"/>
In recommending the policies and incentives described in subdivision (a), the state board shall ensure all of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
Policies and incentives to decarbonize hard-to-electrify sectors are performance-based and technology neutral.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
The performance metric is based on the life-cycle carbon intensity of fuels and shall be consistent with carbon reductions required in the electricity and transportation fuels sectors.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Entities that are regulated under the Cap-and-Invest Program shall have a lesser compliance obligation commensurate with purchases of
decarbonized gas.
</html:p>
<html:p>
(c)
<html:span class="EnSpace"/>
In recommending the policies and incentives described in subdivision (a), the state board shall also consider all of the following:
</html:p>
<html:p>
(1)
<html:span class="EnSpace"/>
How to incentivize the increased production and use of decarbonized gas instate.
</html:p>
<html:p>
(2)
<html:span class="EnSpace"/>
How to maximize the benefits of decarbonized gas production and use, including, but not limited to, opportunities to mitigate wildfire, reduce pile burning of forest and agricultural residues, reduce landfill waste, use renewable power that may otherwise be curtailed, and create jobs and economic development in the state.
</html:p>
<html:p>
(3)
<html:span class="EnSpace"/>
Delivery requirements or other policies to ensure that decarbonized gases are displacing fossil fuel use in this state.
</html:p>
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