THE NET-ZERO BLOG
Climate policy analysis and updates from Sacramento
Near-term policy opportunities for carbon removal in California
In this blog, we identify near-term, low-cost and viable policy opportunities that would remove key barriers to carbon capture, removal and storage while not crowding-out other important state priorities, such as energy affordability. These policies include: (i) regulatory reforms, such as establishing a clear permitting framework and removing the moratorium on CO2 pipelines, amongst others; (ii) market signals, including establishing that carbon capture is an eligible emissions reduction action under Cap-and-Trade as well as guidance for biomass pathways under the Low Carbon Fuel Standard; and (iii) direct funding, including allocating a portion of Greenhouse Gas Reduction Fund revenues for direct procurement as well as continuing to pursue potential, albeit uncertain, federal opportunities. We conclude by briefly summarizing a ‘business models’ approach to carbon infrastructure for stakeholder consideration.
A clean energy infrastructure plan for the GGRF
There is evidence that California’s Greenhouse Gas Reduction Fund investments are underperforming with multiple programs requiring thousands of dollars to reduce one ton of carbon emissions. Identifying opportunities for leverage - where $1 of public investment can generate a 3x, 4x, 5x or more improvement on key priorities such as residential rate reductions, clean energy deployment, climate resilience, and similar - could significantly improve the overall performance of the portfolio. This blog highlights one such opportunity: dedicating a portion of annual GGRF revenues into a revolving clean energy infrastructure fund. By targeting investments at high priority infrastructure, such as transmission, the fund can have the catalytic effect of unlocking gigawatts of new clean generation at low-cost.
Op-ed: A better deal on the power we need
Last week, NZC’s Director of Clean Power, Neil Matouka, published an op-ed in Capitol Weekly with Matthew Freedman of TURN, outlining how California can lower energy costs and meet climate goals by reforming transmission financing and ownership. The piece highlights new research showing that alternative models and public financing could cut transmission costs by over 50%, or up to $3 billion annually, and supports SB 330 (Padilla) to help achieve these savings.
Strengths and limitations of California's cap-and-trade program
California’s Cap-and-Trade Program has been the subject of discussion in recent weeks as the Legislature considers options for reauthorizing the program, which is currently set to expire in 2030. In this blog, we examine the strengths and limitations of cap-and-trade as a climate policy. We find that while the program can generate low-cost emissions reductions it is markedly insufficient for delivering a statewide net-zero transition in only two decades. The result is that how cap-and-trade auction proceeds are spent becomes extremely important. Strategic investments in infrastructure, technology and resilience could address the limitations of cap-and-trade and support the state’s climate goals.
How can California pay for wildfire prevention at scale?
To reduce the risk of catastrophic wildfire, California must invest billions of new dollars each year into key actions including forest thinning, prescribed fire, defensible space, home hardening and more. Yet for all of our ambition, a key question remains: where does the money come from? In this technical blog post, we analyze five potential state-controlled funding options. We find that while each option has potential in different settings, a new biomass economy producing high-value products from wood waste may be the only option capable of supporting forest treatments at scale.
Addressing California's wood waste crisis
California is facing an unprecedented crisis whereby millions of tons of wood waste from wildfire prevention efforts are being piled and burned or left to decay in forests, increasing the state’s emissions and undermining broader forest resilience goals. Despite some progress towards establishing a circular economy to collect and process the residues into low-carbon products, these efforts have not kept pace with the scale of the problem. In this blog we examine the potential for California to deploy a portfolio of next-generation biomass technologies, including wood products such as mass timber, clean fuels such as hydrogen and sustainable aviation fuel, and carbon dioxide removal.