HomeMy WebLinkAboutRESO 9307Resolution No. 9307
Resolution of the Council of the City of Palo A!'to Adopting the
Cap-and-Trade Revenue Utilization Policy for the Use of Revenues
From the Sale of Allocated Allowances in California's Greenhouse
Gas·Cap-and-Trade Auctions
RECITALS
A. The Global Warming Solutions Act, also known as Assembly Bill 32 (AB 32),
requires that California's Greenhouse Gas (GHG) emissions in 2020 be at the same levels as that
of year 1990, and authorized the California Air Resources Board (CARB) to develop regulations
to reach this goal.
B. CARB's final regulations became effective January 1, 2012 and are contained in
Title 17 of California Code of Regulations, Sections 95800 -96023.
C. The GHG emission cap-and-trade program is one of several tools designed by
CARB to achieve the state's GHG reduction goal and its implementation is due to start in
November 2012.
D. As an electric distribution company, the City of Palo Alto has been allocated GHG
emission allowances (allowances) free of charge by CARB.
E. These allocated allowances are estimated to have a market value of $3.5 to $5
million in calendar year 2013 and are expected to increase in value through 2020.
F. Under the terms of CARB's cap-and-trade regulation, the City is required to sell
these allocated allowances in the auctions conducted by CARB and utilize the auction sale
proceeds "exclusively for the benefit of retail electric ratepayers" and "consistent with the
goals of AB 32". (Title 17 CCR Section 95892(d)(3)).
G. The Council of the City of Palo Alto supports the state's AB 32 goals, and intends
to implement the City's Cap-and-Trade Revenue Utilization Policy in furtherance ofthose goals.
The Council of the City of Palo Alto r'City") does RESOLVE as follows:
SECTION 1. The City's Cap-and-Trade Revenue Utilization Policy (Policy) is adopted as
shown in Exhibit A.
SECTION 2. The Council grants the City Manager or his designee the authority to
implement the Cap-and-Trade Revenue Utilization Policy and use allowances or allocate auction
revenues to projects or expenditures as defined in Exhibit A, however, the City Manager shall
not offer rebates to electric ratepayers under the Policy without first seeking Council approval
of such rebates.
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SECTION 3. Should California's cap and trade program and/or CARB regulations
implementing that program be suspended, discontinued, or materially altered such that CPAU
no longer receives allocated allowances of significant monetary value, Council reserves the right
to terminate the Cap-and-Trade Revenue Utilization Policy and discontinue any programs
funded from allocated allowance revenues.
SECTION 4. The Council finds that the implementation ofthis Policy and expenditure of
funds necessary to comply with AB 32 and California's cap and trade program are reasonable
costs of providing service to CPAU's electric customers.
SECTION 5. The Council finds that the adoption of this resolution does not meet the
California Environmental Quality Act's definition of a "project" under Public Resources Code
section 21065.
INTRODUCED AND PASSED: December 10, 2012
AYES: BURT, ESPINOSA, HOLMAN, KLEIN, PRICE, SCHARFF, SCHMID, SHEPHERD, YEH
NOES:
ABSENT:
ABSTENTIONS:
APPROVED AS TO FORM:
~ City Attorney
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