With the legislative clock running out, California lawmakers and Gov. Gavin Newsom reached late-night deals Wednesday on climate and energy, setting up a high-stakes vote.
The agreements, hammered out just before the end of the legislative session, extend California’s cap-and-trade program (now renamed cap-and-invest) — essentially the state’s carbon credit system — through 2045, shift consumer climate credits to summer months, and steer $1 billion a year to high-speed rail. Supporters say the program provides long-term certainty to carbon markets and relief for households facing higher summer bills, while critics argue it falls short for communities living near pollution hotspots.
Another measure drew fire from environmental justice advocates for easing oil industry rules. Senate Bill 237 would require the Governor to suspend California’s stricter summer fuel standard when prices spike and would clear a backlog of drilling permits in Kern County. Proponents frame it as an affordability move; opponents warn it’s a giveaway to oil companies that undermines decades of air quality gains.
On the utility front, Senate Bill 254 would allow the state to issue bonds to finance grid upgrades — a shift from the traditional utility model of funding improvements through shareholder-backed capital spending.
Advocates say this could save ratepayers billions. The bill also replenishes California’s wildfire fund, nearly depleted after January’s blazes, with utilities and customers splitting the $18 billion cost. In a joint statement, PG&E, SCE, and SDG&E praised the move as a step toward stability, though they cautioned more work is needed on wildfire risk.
Finally, lawmakers advanced Assembly Bill 825, which would enable California to join a new Western electricity market. Supporters say broader regional trading will strengthen reliability and lower costs, while critics fear it could dilute California’s control over its clean energy agenda.
The Bottom Line:
For Californians — and for energy consumers watching from other states — the biggest stakes in these deals lie with utilities and the grid.
Senate Bill 254 changes the traditional utility financing model, using public bonds instead of shareholder-backed spending, a shift that could lower costs for ratepayers. PG&E, SCE, and SDG&E praised the addition of wildfire funding as a step toward greater stability, signaling cautious support from the state’s biggest utilities. And Assembly Bill 825 positions California to join a Western electricity market, a move that could eventually mean lower prices and stronger reliability by sharing power across state lines.
For consumers, the fine print in Sacramento’s late-night deals could ripple directly into monthly bills and the stability of the grid.
Positive Current
