March 14, 2024
Dear Californians,
For fifteen years, Next 10 has closely tracked the most pressing environmental and economic challenges facing the state of California, with a goal to educate and empower Californians to seek a better future for our state. Following historic federal and state investments, there have been encouraging developments on climate action that will spur economic growth while reducing greenhouse gas emissions and harmful air pollution. However, we are not doing enough, fast enough.
From 2020 to 2021, total emissions increased by 3.4% as pandemic travel restrictions eased and the economy reopened. This follows an 8.8% decrease in 2020 emissions compared to 2019. Given the 3.4% increase in 2021, the state needs to reduce emissions by 4.4% each year in order to meet the 2030 goal of 40% below 1990 levels (emissions have only decreased by 0.4% per year on average since 1990). These are sobering statistics. The world sees California as a global leader in innovation and climate action—and that is true. However, the most important metric is reducing GHG emissions, and it is unlikely that we will hit our 2030 target at the current rate.
Within the total increase in California, transportation emissions increased to 38.2% of total emissions—an increase of 7.4% compared to 2020. Emissions from the electric power sector, which has historically seen some of the largest reductions, Emissions from the electric power sector, which has historically seen some of the largest reductions, also increased by 4.8%. from 2020 to 2021. Lastly, industrial emissions increased by 0.9%, which may be due to the increased demand for transportation fuels in 2021 as the state resumed more industrial operations as pandemic restrictions eased. These three sectors represent the top three largest sectors as a share of total emissions. To have all three of them increasing is concerning as California needs to be going in the opposite direction.
While renewable energy generation grew in California by 2.2% to account for 35.8% of the total power mix in 2022, California’s share of electricity generation from renewables still needs to increase by 8.7% each year from 2022 to 2026 to meet the goal of 50% of generation from RPS-eligible renewable sources by 2026. To meet the 2030 goal of 60%, the share of electricity generation from renewables would need to increase by 4.7% annually from 2026 to 2030.
Despite these setbacks, the Inflation Reduction Act (IRA) has brought billions of dollars into California to expand battery manufacturing for both storage and electric vehicles, along with new manufacturing of solar panels. The IRA is also providing benefits directly to consumers, such as the EV tax credits and the credits that reduce the cost of a variety of home energy-efficient upgrades, from installing insulation to buying heat pumps.
The state also held the first leases for offshore wind development and set a target of generating two to five gigawatts (GW) of power by 2030 to supplement our existing renewable energy portfolio and get us closer to carbon neutrality by 2045. However, the logistics of installing floating wind turbines miles off the coast and the need for additional transmission lines and substations could cause delays in adding that electricity to the grid. California needs a diverse range of energy sources in order to meet our renewable and climate goals.
Following Governor Newsom’s Executive Order in 2020 requiring 100% of new vehicle sales in the state to be zero-emission vehicles by 2035, federal and state investments will be crucial to meeting this target and reducing transportation emissions in California—the largest source of emissions in both the state and nation.
Following Governor Newsom’s Executive Order in 2020 requiring 100% of new vehicle sales in the state to be zero-emission vehicles by 2035, federal and state investments will be crucial to meeting this target and reducing transportation emissions in California—the largest source of emissions in both the state and nation. California met the 2025 goal of 1.5 million zero-emission vehicles (ZEVs) on-road two years early, and there were over 1.6 million EVs on the road in California as of August 2023. The tax credits and incentives from the IRA that reduce the purchase price of an EV and build out additional charging infrastructure should help continue that upward trend.
While some of these developments are encouraging, we are not on track to meet our 2030 target. The 2022 Scoping Plan proposed a more aggressive GHG emissions target of 48% below 1990 levels instead of the current 40% by 2030—but even meeting the existing target is unlikely unless major changes are made. California must successfully reduce total emissions by 4.4% annually to meet the 2030 goal. California has only reduced emissions at that rate twice since 2000 and both times were during recessions.
We can show the world that we can reduce our emissions through a combination of being at the forefront of EV sales, new charging stations, new renewable energy, electrification of buildings and transportation, and clean tech innovation. It is important we ensure all Californians are part of the solution—from job creation in burgeoning green industries to toxic site cleanup—as harmful air pollution and climate change disproportionately impact our historically disadvantaged communities. This is crucial as Californians are already feeling the impacts of climate change—such as droughts, wildfires, flooding, and extreme heat—and the state must implement policies to adapt to these ongoing changes.
We hope that our latest data will shed light not only on the challenges we face in attempting to address climate change while growing our economy, but also the opportunities to help us get there. By redoubling our statewide efforts to serve as a climate leader, we can help deliver benefits to all Californians while reclaiming our role as a global leader.
Sincerely,
Noel Perry, Founder