GREEN GROWTH: FROM RELIGION TO REALITY - Sustainia
GREEN GROWTH: FROM RELIGION TO REALITY - Sustainia GREEN GROWTH: FROM RELIGION TO REALITY - Sustainia
Chapter xxxCALIFORNIASTATE CASE ANALYSIS© Berkeley Roundtable on the International EconomyJune 15, 2011Prepared by Juliana Mandell and Nina Kelseywith Jeremy Pilaar, Andrea Seow, and Andrew Willis50
Chapter 51 IntroductionCalifornia’s current bid to become a global leader in clean-tech reflects a history of leadership in energy and climatepolicy. In the last quarter of 2010 the state captured 50percent of global venture capital funding for clean-tech.In 2006 it passed AB 32 the most aggressive climate bill ofany state in the nation. These developments were madepossible by a historical trajectory of policy and businesscommunity development dating back to the 1940s. Earlysuccessful energy legislation laid the foundation for futurepolicy, created a precedent for unique cross-sectorrelationships and shaped policy tools available for futureaction. Building upon this foundation California’s alreadyestablished venture capital community, supportedby the state’s top-tier research universities and policymakers, is investing in clean tech as an attractive greengrowth initiative. Whether these investments will realizethe economic gains venture capital and policy makershope for, however, remains an open question.California’s green growth history began in the midtwentieth century as a period of green growth compatiblewith emissions reductions. While emission reductionswere achieved during this early period, the primary focusof policy was air pollution and emissions reductionsonly a derivative effect. Relevant energy movements duringthis period were comprised of two strands: (1) successfulenergy efficiency programs and [2] unsuccessfulderegulation of the electricity industry. Energy efficiencyprograms, in combination with structural factors, wereable to keep California’s per-capita electricity use relativelyflat, while permitting significant economic growth(discussed below). On the other hand, deregulation ofthe California electricity industry was riddled with unintendedconsequences and was largely unsuccessful.Recently, a third strand of green growth developmentin California began taking hold. This movement represents(3) a more emissions-aware energy movement, basedaround the idea that growth could be driven by emissionsreduction, and that the clean-tech industry couldrepresent the next major new source of economic growthfor California. Below, we explore each of these threeChronological Overview1941 Los Angeles experiences severe air pollution1947 State creates first ever county-level Air PollutionControl Districts1959 Through collaboration with the university researchcommunity, policy makers require theState Department of Public Health to set motorvehicle air quality standards1961 Emission regulations for vehicles are passedinto law, first in the nation1967 The statewide regulator agency the CaliforniaAir Resources Board is created1967 California wins the legal right as the only stateallowed to deviate from national policy andimpose more stringent air pollution regulation1973 OPEC oil embargo creates political support forenergy efficiency programs1974 Creation of the California Energy Commissionwith the authority to regulate building and applianceefficiency standards1977 Sate adoption of wide spread efficiencystandards for appliances and buildings1977 An amendment to the national Clean Air Actallows California to regulate fuels and fuel additiveswithout EPA approval and gives otherstates the option to choose between adoptionof California or national standards1996 California implements aggressive electricityderegulation policy2000 Deregulation leads to fiscal and energy crisis2002 State legislature passes Assembly Bill 1493regulating GHG emissions reductions in Californiamotor vehicles manufactured after 20092002 State Legislature passes SB 1078 mandating20% of state electricity be generated from renewablesources by 2017, the most aggressivestandard in the nation2006 California Legislature passes Assembly Bill 32:the California Global warming Solutions ActGreen Growth: From religion to reality 51
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Chapter xxxCALIFORNIASTATE CASE ANALYSIS© Berkeley Roundtable on the International EconomyJune 15, 2011Prepared by Juliana Mandell and Nina Kelseywith Jeremy Pilaar, Andrea Seow, and Andrew Willis50