Recently, I mentioned that California seems to be backtracking on climate initiatives, primarily due to actions taken by Governor Gavin Newsom. I criticized him and his team for efforts to undermine rooftop solar, support the Aliso Canyon gas facility, and delay the rollout of plastic recycling laws, which, well, seemed a bit counterproductive.

However, I think it’s only fair to acknowledge some positive steps he took during the legislative session last week.

Under Newsom’s encouragement, lawmakers have engaged in a series of measures aimed at controlling rising electricity costs, boosting renewable energy supplies, and prolonging the Cap-and-Trade emissions reduction initiative. Environmentalists rightfully expressed their anger over a deal to promote oil drilling in Kern County, Southern California. It’s a tough trade-off, and one that might not sit well with everyone. Nonetheless, some important work was accomplished by the state’s leaders.

Here’s a summary of what they achieved, along with some thoughts on what more the next governor might need to tackle.

Electricity Costs

Lawmakers approved multiple bills aimed at reducing electricity prices, which is crucial given the state’s high cost of living. Affordable electricity could encourage more people to drive electric vehicles and install heat pumps to warm their homes.

One key piece is Senate Bill 254, which will take away profits from utility companies.

Investor-owned utilities don’t profit from electricity sales but do earn around 10% from infrastructure investments. However, with SB 254, shareholders of major utilities like Southern California Edison and Pacific Gas & Electric won’t benefit from the upcoming $6 billion expense aimed at lowering wildfire risks starting in 2026.

This bill lays the groundwork for government loans to develop new power lines, which could save money since utility customers won’t be shouldering shareholder profits.

Senator Josh Becker (D-Menlo Park), chairing the Senate Energy Committee, noted the significance of overcoming utility resistance to these ideas. Given Edison’s potential liability for damages from last January’s Eton fire, utility executives were pushing lawmakers to bolster the dwindling wildfire fund to cover their claims. They’re eager to avoid more situations like PG&E’s bankruptcy after the deadly 2018 Camp Fire.

And, yes, lawmakers responded to these appeals. SB 254 adds $18 billion to the Wildfire Fund, with half coming from utility shareholders and half from customers, who’ve already been contributing about $3 monthly. While it sounds unpleasant, I believe it was a reasonable decision. Utilities need to be viable economically, especially amid climate challenges.

“We needed to get that sorted out,” Becker remarked.

Renewable Energy Initiatives

Another significant win for Newsom is Assembly Bill 825, which aims to create a western electricity market to facilitate the sharing of solar and wind energy across state lines. This should help California import low-cost energy from states like New Mexico and Wyoming while also allowing it to export solar energy when needed, all without relying on fossil fuels or raising utility rates.

There are skeptics, particularly among environmentalists, who worry that the local market might mean California would need to compromise its grid control and possibly import coal-fired energy from Utah or Wyoming.

Personally, I’m not too concerned. Becker mentioned that the market could be especially beneficial during extreme heat events when using air conditioning strains the grid. Instead of rashly constructing more solar plants and power lines to prevent blackouts, California can leverage renewable resources from neighboring states.

“California doesn’t need to overbuild infrastructure like Walmart expanding its parking lots for holiday traffic,” he stated.

Cap-and-Trade Program

At the core of many legislative efforts is Cap-and-Trade, a signature climate initiative that limits emissions from significant polluters, such as power plants and refineries. Companies buy emissions permits through quarterly auctions, generating funds for climate solutions.

Before last week’s developments, Cap-and-Trade was set to expire in 2030, which poses a risk of lower permit pricing and diminished revenues.

In response, Newsom proposed extending Cap-and-Trade through 2045. While the program has seen broad support, his proposal faced criticism from environmentalists wanting stricter terms, particularly regarding the oil and gas sector. In contrast, the oil industry sought more leeway in emissions claims, arguing that existing restrictions drive up energy expenses.

Ultimately, Newsom succeeded in expanding Cap-and-Trade with minimal changes through Assembly Bill 1207.

High-Speed Rail

Additionally, Newsom has secured $20 billion in Cap-and-Trade funds for California’s long-awaited bullet train project, which now stands $100 billion over the original budget without a clear completion date. Nevertheless, the governor’s commitment reflects strong union support.

When I asked Becker for his thoughts on the funds he approved, he just chuckled.

“Want to hear my comment?” he said, laughing again.

I genuinely wish to take a bullet train from LA to San Francisco. It frustrates me to see opposition to high-speed rail, especially from the previous administration. Yet Newsom’s focus on allocating funds for slow-moving projects instead of promoting electric vehicle incentives makes me think he’s positioning himself more as a presidential contender than a state leader.

Newsom’s Vision

Think about it: lower energy prices, regional electricity markets supported by the utilities, and an expanded Cap-and-Trade program highlight a complex yet promising scenario. If he aims to win national favor, it’s a strategy that seems plausible.

Still, it’s worth noting his recent legislation, particularly Senate Bill 237, which hastens approvals for thousands of new oil wells in Kern County while streamlining environmental reviews. With two refineries slated for closure in the next year, Newsom’s push for more drilling aims to keep gasoline prices stable, even with the potential for increased air pollution.

Does it work? Experts show skepticism, yet there’s no doubt that these moves enhance his broader political appeal. It’s a complicated dance—balancing climate concerns with the pressing cost of living. It’s a move that might seem presidential, almost.

As California braces for the next wildfire, heatwave, or flood, it’s critical for voters to prioritize climate leadership in the upcoming gubernatorial election. We need a leader who places the climate first, not merely when it’s politically expedient.