Californians will see a “virtuous cycle” of low-carbon investments begin as cap-and-trade auction proceeds finally head out the door starting this summer. This is the news from the Brown administration this week detailing how they propose to start investing dollars from 2014 carbon auctions while beginning to repay the $500 million borrowed last year.
We are especially excited to see that California's most disadvantaged communities — the ones that have suffered environmental burdens for years and will be hit hardest by climate change in the future — will see more than the mandated 25% of auction proceeds invested for their benefit. Consistent with an investment plan released last year, there will be three major categories: sustainable communities and low-carbon transportation, energy efficiency and clean energy, and natural resources and waste diversion. Clean transportation and sustainable communities will receive the largest chunk ($350 million) of the proposed $850 million investment. This means we will see investments in solutions such as clean trucks and buses, electric vehicle rebates, zero-emission freight demonstration projects, and enhanced connectivity and modernization for public transit in disadvantaged communities.
Investments like these will create big wins for California’s most at-risk communities.
Consider this: Diesel trucks and buses are the single-largest source of toxic diesel pollution in the state, causing cancer, heart attacks, breathing emergencies, lost days at work, and even premature death. Similarly, alternative personal vehicles like those with electric batteries can provide benefits to communities. A recent study by ICF and an earlier study from UC Berkeley both showed significant benefits from investments in clean transportation and other low-carbon investments which include job creation, increased gross state product, and increases in personal incomes, not to mention indirect health care savings.
Why do we call this a “virtuous cycle” of investment?
The economic benefits are not simply the direct benefits you may think of first, such as job growth in areas like manufacturing and selling clean trucks, buses, and vehicles. Research also shows that when you save $1 on energy costs — which would more than likely go to an international oil conglomerate — the benefit to the economy is $16.
How does this work? Instead of sending those dollars overseas, you're most likely spending them in your community, on local products and services.
Today, Governor Brown committed to the first of many critical cap-and-trade investments in disadvantaged communities and cleaner options for Californians. With this new virtuous cycle of investment, we expect these and subsequent investments to pay dividends to the health of our citizens, our environment, and our economy for years to come.