The Future of High-Speed Rail in California:. CDAWG @ PALA October 8, 2014 Lance Christensen Reason Foundation. An Introduction—Full Disclosure. Bachelor of Arts, Brigham Young University Master of Public Policy, Pepperdine University California Senate Fellow, CSU Sacramento
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The Future of High-Speed Rail in California: CDAWG @ PALA October 8, 2014 Lance Christensen Reason Foundation
An Introduction—Full Disclosure • Bachelor of Arts, Brigham Young University • Master of Public Policy, Pepperdine University • California Senate Fellow, CSU Sacramento • Budget Analyst, Department of Finance • Legislative Director, Senator Tom McClintock • Fiscal & Policy Consultant, Senate Republican Caucus • Pension Reform Project Director, Reason Foundation • Pater familias, married to a Bakersfield native with 3 energetic boys & a tiny girl
Free Minds, Free Markets Reason Foundation advances a free society by developing, applying, and promoting libertarian principles, including individual liberty, free markets, and the rule of law. Reason Foundation produces respected public policy research on a variety of issues and publishes the critically-acclaimed Reason magazine. Together, our top-tier think tank and political and cultural magazine reach a diverse, influential audience, advancing the values of choice, individual freedom and limited government. And it is there that I direct the Pension Reform Project.
Going to California I posit that California is the Zeppelin— Either it flies and takes the country with it… …or it crashes & burns the whole country down.
And trains are not impervious to crashes… The faster they go, the bigger the wreck. Just ask China.
High-Speed Rail Authority Established by SB 1420 (Kopp, Chapter 796, Statues of 1996) Ratified by voters in Proposition 1A—November 2008 general election—for the purpose of directing the development and implementation of high-speed train service in California. HSRA has a nine-member board, five appointed by Governor to four year terms, are not subject to Senate confirmation.
HSRA 2014 business plan draft map Map includes: Already existing rail lines in California, slated to receive upgrading during the project’s duration (e.g. Amtrak Surfliner) Completed length of the rail line. A more realistic map would show the actual high-speed rail sections. http://reason.org/blog/show/california-high-speed-rail-2014-bus
The goal was to build a high-speed train HSRA’s plan today is dramatically different than plan presented to the voters in November 2008. Voters agreed to a system that would: Cost $33 billion to construct (state’s portion being $9 billion in general obligation bonds) Up & running by 2020 providing service between San Francisco and Los Angeles Faster and cheaper than what is currently available from the airlines Make a profit in its first year of operation Have 39 million passengers per year by completion. All in the name of better transportation & saving the environment.
But it’s going to be a high-cost train Today, the HSRA’s plan is predicted to cost at least twice that, but more likely upwards of $100 billion. First phase of the project won't even be completed by 2020 Ridership assumptions have been criticized by virtually every unbiased analyst as hopelessly unrealistic Less than 15% of the money for construction (best case scenario) has been identified System will require long-term subsidies, likely sucking up virtually all the state's cap & trade revenues Simply a violation of the voter's trust.
Looking to the Feds In January 2010, HSRA received an American Recovery and Reinvestment Act grant of $2.25 billion to aid in the development of the Phase I project. Of that amount: $400 million is for constructing the basement of the new Transbay Terminal in San Francisco to accommodate high-speed trains. $1.85 billion is for purchasing right-of-way, constructing track, signaling systems, and stations, and completing environmental reviews and engineering documents for the Los Angeles/Anaheim segment, the San Francisco/San Jose segment, the Fresno/Bakersfield segment, and the Merced/Fresno segment. 2nd Round: $1.3 billion 3rd Round:$300 million from funds declined by Florida. HSRA & FRA jointly selected 1st segment from near Fresno to near Bakersfield. Between federal funds, state bond funds, HSRA has committed about $5.7 billion for the Central Valley project. As a condition of the ARRA grants, the HSRA must complete construction by September 30, 2017.
Not if they have anything to say about it New House Majority Leader Kevin McCarthy, R-Bakersfield, has vowed to "do all that I can to ensure not one dollar of federal funding goes to boondoggles like [California's] high-speed rail." Similarly, Rep. Jeff Denham, R-Modesto, told the Register, "Until I see a viable business plan for high-speed rail in California that is fiscally sound and supported by private dollars, I will continue to hold the rail authority accountable to the voters and ensure no additional federal tax dollars go to this project." http://reason.org/blog/show/ca-bullet-train-no-plan-little-mone
Analysis: 2014-15 Governor’s Proposed Budget • New record spending levels in total state spending ($240 billion), GF spending ($106.8 billion). • GF spending is $10.5 billion higher than current budget act level. • Legislative Democrats desire to spend several billion more than the Governor. • Local schools will benefit from state's new revenues since budget provides increase of more than $6 billion to K-14 education for 2014-15, assuming legislative Democrats keep the promises made to the voters when they campaigned for Proposition 30. • Proposes to pay off $11 billion in debt, which is a very good start. • There is no “budget surplus” for new state spending; unfunded liabilities exist. -Budget Briefs, Senate Republican Fiscal Office, “Highlights & Analysis of the Governor’s 2014-15 Budget,” January 2014
Budget Sets Record High for State Spending General Fund spending hits $108 billion, eclipsing the pre-recession peak of $103 billion. True General Fund program spending also hits a record $119 billion after accounting for fund shifts & other accounting maneuvers, which is $11 billion higher than last year. Total state spending (from all fund sources) is $254.4 billion – nearly $25 billion above previous record of $230 billion. Relative to Governor’s budget plan, final budget agreement increases baseline state spending by about $900 million & reduces amount of debt repayment by $700 million. -Budget Briefs, Senate Republican Fiscal Office, “Highlights & Analysis of the Governor’s 2014-15 Final Budget,” June 2014
Overstaffing means overpaying Caltrans’ Overstaffing Diverts $500 million from Local Streets and Roads. Budget provides $1.7 billion & 9,894 FTE positions for Capital Outlay Support Program within Caltrans despite a Legislative Analyst’s Office report that indicated the COS Program is overstaffed by 3,500 positions at a cost of more than $500 million annually. Lance’s comment: Don’t think this won’t happen to HSRA…
A Blank Check for High Speed Rail Enacted Budget includes: $250 million in Cap & Trade funding for HSR project in 2014-15. Allocates 25% of future Cap & Trade revenues, beginning in 2015-16 continuously appropriated. Hundreds of millions of dollars spent annually on HSR without future votes of Legislature.
Passing Debt Burden to Future Generations Pays down “wall of debt” by $10.4 billion, about $700 million less than Governor’s original plan.
What can Brown do for you? Obfuscate, according to David Crane in a recent Bloomberg article: “Just as California’s budget wasn’t fixed in 2000 or 2007, it isn’t fixed in 2014. In fact, even though revenue, taxes and fees are higher now than they were the last time California reported a balanced budget, in 2007, state spending on most state services is lower. Spending on welfare, universities, courts and parks is down more than 20 percent because spending on employee salaries, pensions, retiree health care, debt service and Medicaid is up more than 20 percent.” http://www.bloombergview.com/articles/2014-04-13/how-jerry-brown-hoodwinks-reporters
California ranks… 39th in Forbes Best States For Business 2013 47th in 2014 ALEC-Laffer State Econ Competitive Index 47th in CNBC’s 2013 Top States to Do Business 48th in Tax Foundation’s 2014 State Business Tax Climate Index 50thin USA Today’s 2013 Best and Worst Run States 50th in Chief Executive’s 2013 Best & Worst States for Business http://www.alec.org/wp-content/uploads/RSPS-CA-14.pdf, http://www.cnbc.com/id/100824779, http://www.usatoday.com/story/money/business/2013/11/22/best-worst-run-states/3671359/, http://chiefexecutive.net/best-worst-states-for-business-2013, http://www.forbes.com/best-states-for-business/, http://taxfoundation.org/sites/taxfoundation.org/files/docs/2014%20State%20Business%20Tax%20Climate%20Index.pdf
Economic forecasting a little glum “Water isn't the only drought in Los Angeles. Los Angeles, Detroit and Cleveland share the dubious distinction of cities with the weakest job growth since 1990. That’s a shocking club for Los Angeles to be a member of. Many of the problems the city currently faces would be less severe if employment and city revenues had been growing more rapidly.” UCLA Anderson Forecast for the Nation, State and L.A. April 2014 http://uclaforecast.com/uploads/events/2014/April/ebrochure_April2014_laacc.html
CA vs. TX – who wins? Katy Grimes of the Flash Report writes: “Apparently California is ‘leaking’ businesses… as if businesses and middle class families are dribbling away, or just accidentally seeping into other states. But according to Jon Coupal of the Howard Jarvis Taxpayers Association, more than 50 companies have relocated or expanded in Texas in the last year and a half.” http://www.foxandhoundsdaily.com/2014/05/californias-business-leakage-becoming-deluge/
Speaking of Texas The Big Texas Plan to Copy Japan's High-Speed Rail Success Texas Central Railway intends to build a Houston-Dallas line with private money. The link will provide a 200-mile-per-hour bullet train as soon as 2021. http://www.citylab.com/commute/2014/06/the-big-texas-plan-to-copy-japans-high-speed-rail-success/372984/
California Academic Performance Index (API) * California Access for Infants and Mothers * California Acupuncture Board * California Administrative Office of the Courts * California Adoptions Branch * California African American Museum * California Agricultural Export Program * California Agricultural Labor Relations Board * California Agricultural Statistics Service * California Air Resources Board (CARB) * California Allocation Board * California Alternative Energy and Advanced Transportation Financing Authority * California Animal Health and Food Safety Services * California Anti-Terrorism Information Center * California Apprenticeship Council * California Arbitration Certification Program * California Architects Board * California Area VI Developmental Disabilities Board * California Arts Council * California Asian Pacific Islander Legislative Caucus * California Assembly Democratic Caucus * California Assembly Republican Caucus * California Athletic Commission * California Attorney 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California Building Standards Commission * California Bureau for Private Postsecondary and Vocational Education * California Bureau of Automotive Repair * California Bureau of Electronic and Appliance Repair * California Bureau of Home Furnishings and Thermal Insulation * California Bureau of Naturopathic Medicine * California Bureau of Security and Investigative Services * California Bureau of State Audits * California Business Agency * California Business Investment Services (CalBIS) * California Business Permit Information (CalGOLD) * California Business Portal * California Business, Transportation and Housing Agency * California Cal Grants * California CalJOBS * California Cal-Learn Program * California CalVet Home Loan Program * California Career Resource Network * California Cemetery and Funeral Bureau * California Center for Analytical Chemistry * California Center for Distributed Learning * California Center for Teaching Careers (Teach California) * California Chancellors Office * California Charter Schools * California Children and Families Commission * California Children and Family Services Division * California Citizens Compensation Commission * California Civil Rights Bureau * California Coastal Commission * California Coastal Conservancy * California Code of Regulations * California Collaborative Projects with UC Davis * California Commission for Jobs and Economic Growth * California Commission on Aging * California Commission on Health and Safety and Workers Compensation * California Commission on Judicial Performance * California Commission on State Mandates * California Commission on Status of Women * California Commission on Teacher Credentialing * California Commission on the Status of Women * California Committee on Dental Auxiliaries * California Community Colleges Chancellors Office, Junior Colleges * California Community Colleges Chancellors Office * California Complaint Mediation Program * California Conservation Corps * California 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Commission * California Democratic Caucus * California Demographic Research Unit * California Dental Auxiliaries * California Department of Aging * California Department of Alcohol and Drug Programs * California Department of Alcoholic Beverage Control Appeals Board * California Department of Alcoholic Beverage Control * California Department of Boating and Waterways (Cal Boating) * California Department of Child Support Services (CDCSS) * California Department of Community Services and Development * California Department of Conservation * California Department of Consumer Affairs * California Department of Corporations * California Department of Corrections and Rehabilitation * California Department of Developmental Services * California Department of Education * California Department of Fair Employment and Housing * California Department of Finance * California Department of Financial Institutions * California Department of Fish and Game * California Department of Food and Agriculture * California Department of Forestry and Fire Protection (CDF) * California Department of General Services * California Department of General Services, Office of State Publishing * California Department of Health Care Services * California Department of Housing and Community Development * California Department of Industrial Relations (DIR) * California Department of Insurance * California Department of Justice Firearms Division * California Department of Justice Opinion Unit * California Department of Justice, Consumer Information, Public Inquiry Unit * California Department of Justice * California Department of Managed Health Care * California Department of Mental Health * California Department of Motor Vehicles (DMV) * California Department of Personnel Administration * California Department of Pesticide Regulation * California Department of Public Health * California Department of Real Estate * California Department of Rehabilitation * California Department of Social Services Adoptions Branch * California Department of Social Services * California Department of Technology Services Training Center (DTSTC) * California Department of Technology Services (DTS) * California Department of Toxic Substances Control * California Department of Transportation (Caltrans) *
The running of the trains Do due diligence Evaluating tenuous claims about state’s infrastructure Engineering & bureaucratic failures Greening of sprawl Carbon intensive energy usage Cap and trade duplicity Bonded debt Legal liabilities
California High Speed Rail: An Updated Due Diligence Report Reason Foundation’s report warned HSRA plans issued prior to & during 2008: Were inaccurate, misleading and not in compliance with California statutes. Authority’s financing plan overstated projected revenues and private financing, and understated capital requirements and operating subsidies needed from taxpayers. Subsequent independent studies and new Authority documentation have proven virtually every characterization in Reason’s 2008 Due Diligence Report to be accurate or understated. Cost-prohibitive: Full Phase 1 system that had new rail lines dedicated exclusively to high speed trains into San Francisco and Los Angeles, with “blended” system (slow train-speed and shortenedlines) continues to useridership & train-speed data from the Full Phase I system in its original plan in its analysis of the blended plan’s viability. Current plans are now identified as “Phase 1 Blended,” which HSRA estimates will cost as much as $63.2 billion in 2011 inflation-adjusted dollars ($78.0 billion in year-of-expenditure dollars) with the only sources of funding being $9 billion in California Proposition 1A general obligation bonds and $3.5 billion in federal grants. -Joseph Vranich and Wendell Cox; Project Director: Adrian T. Moore, Ph.D.; April 2013 http://reason.org/files/california_high_speed_rail_report.pdf
Jaw-Droppingly Shameless HSRA, high-speed rail promoters repeatedly claim that it will cost the state more to expand highways and airports if the rail system isn’t built. The assertion is that such alternatives to high speed rail would cost $171 billion to expand highways & airports. Mother Jones stated that HSRA’s “unrealistic estimates of what the alternatives to high speed rail would cost” are “jaw-droppingly shameless.” It added: “There’s not even a pretense here of providing a reasonable, real-world traffic estimate that could be used to project the cost of alternative infrastructure. A high school sophomore who turned in work like this would get an F.” -Joseph Vranich and Wendell Cox; Project Director: Adrian T. Moore, Ph.D.; April 2013 http://reason.org/files/california_high_speed_rail_report.pdf
Where is HSR profitable? So far, little private sector interest. With a dubious & panned business plan, it is unlikely any private company would invest in this line. To date, there are only two profitable high speed rail lines: Japan (Osaka-Tokyo) France (Paris-Lyon) Japan (Hakata-Osaka) breaks even
U.S. is not Japan or Europe Others point to successful high-speed rail lines in Western Europe & Japan, but forget: Those countries were built high-speed rail because conventional rail travel was already busting at the seams. Different spatial structures developed around walking & mass transit. When Tokyo-Osaka line was built, fewer than 25% of driving-age residents owned a car. Current car ownership rate in California is over 85%. Passengers are willing to take high-speed rail in those other places because travel times are competitive with cars or planes. When HSRA decided California's system needed to serve the Central Valley, the 2 hour, 40 minute trip that voters were promised from Los Angeles to San Francisco turned into a four hour odyssey, which would be much slower than air travel - even factoring in getting to the airport, security and other delays. http://reason.org/news/show/californias-bullet-train-no-plan-no
Again, LAO disagrees with HSRA Legislative Analyst’s Office: Alternative Cost Estimate Overstated. The draft business plan compares the estimated $99 billion to $118 billion cost of constructing high-speed rail with an estimated $170 billion cost of adding equivalent capacity to airports and highways. This comparison is very problematic because $170 billion is not what the state would otherwise spend to address the growth in inter-city transportation demand. HSRA estimates that the high speed train system would have the capacity to carry 116 million passengers per year but their highest forecasted ridership is significantly less than that amount—44 million rides per year (roughly 40% less than capacity).
Highway Lane Miles Exaggeration HSRA claims a need to add six lanes on parallel highways (three lanes in each direction) to equal the capacity of the high speed rail line. Problems: Exaggerating Train Capacity: HSRA uses a train size of more than twice as many seats as it intends to operate in 2040 (1,000 seats instead of 450 seats). Correcting this exaggeration reduces the actual capacity by 55%. Exaggerating Train Frequencies: HSRA used more trains with more capacity in its capacity analysis than it actually plans to peratein 2040. Correction of this exaggeration would reduce the revised capacity by another 87%. Exaggerating Highway Construction: HSRA claims that it would be necessary to add the high speed rail capacity in duplicate (the longest being the parallel SR-99 and I-5 routes in the San Joaquin Valley). Each route segment would require an additional six lanes. Correction of this exaggerated build capacity on only one highway (since there will be only one high speed rail line) would reduce the revised capacity by another 41%. -Joseph Vranich and Wendell Cox; Project Director: Adrian T. Moore, Ph.D.; April 2013 http://reason.org/files/california_high_speed_rail_report.pdf
Airline Capacity Exaggeration HSRA concludes that equivalent airport capacity would cost $30.3 billion (2011$) assuming substantial terminal, runway expansion based upon an average airplane capacity of 70 passengers. This capacity is far below current average capacity for airlines in California according to Authority’s own Ridership & Revenue Forecasting Memorandum: Final Technical Memorandum83 where Table B-1’s average capacity of airliners whose destinations are within California is 135.84. For HSRA to concurrently publish documentation with such radically different data (a nearly 50% understatement in the average airliner capacity) is concerning & is the type of inconsistency that would not be expected from a state agency with a multi-million dollar annual budget. Current airport capacity can accommodate demand expected in next 25 years. -Joseph Vranich and Wendell Cox; Project Director: Adrian T. Moore, Ph.D.; April 2013 http://reason.org/files/california_high_speed_rail_report.pdf
The Creator disapproves Former-Senator Quentin Kopp, creator of the High-Speed Rail Authority (HSRA), strong proponent of Proposition 1A in the November 2008 elections in LA Times on April 16, 2013: "The cunning progenitors of this plan have expropriated bond money to improve commuter rail [for use in the high-speed system]. [But] high-speed rail can only operate on dedicated track, separated not shared. [Legislators] don't have the guts to stand up and say to their constituents, 'We're one state and the voters in this one state agreed to it.' [The current plan] was adopted under political pressure, toadying to the wealthy people of Atherton, Menlo Park, Palo Alto and Burlingame, best characterized as NIMBYs, who fear losing their palatial properties and fear noise, which is ironic because high-speed rail trains make less noise than diesel. Their plan would electrify Caltrain [the San Francisco Peninsula commuter system] to operate at a speed up to 125 miles per hour. That is the reason for the raid on Proposition 1A [bond funds]. And if you give money to a Northern California commuter rail, politically you have to match it for Southern California. Those factors led to the dismembering of high-speed rail, the sorry spectacle of the first alleged usable segment, which is not usable, 130 miles from Merced to Bakersfield, which will now be built as conventional rail! To operate profitably, or without any taxpayer subsidy, you must operate, at peak hours, about 10 high-speed trains per hour. If you share the tracks with the commuter system, you can't do that. HSR wouldn't be able to run more than two trains per hour, [although] the HSR authority claims it might be able to run four per hour."
Spinning—or melting—their wheels From Bakersfield Californian, September 27, 2014 Tehachapi Mountains or the Grapevine have steep grades, would require extensive tunneling and viaducts, both of which would be very expensive. Newly released progress reports engineering firm URS Corp. sent the rail authority in fall 2013 raise concerns about a stretch of more than 4 miles southeast of Tehachapi near Oak Creek Road where the mountain grade is greater than 3.5 percent. That exceeds HSRA's self-imposed limit of 3.5 percent average grade for sections measuring about 4 miles. The challenge is going down a steep mountain. Dan McNamara, high-speed rail expert for Texas-based Fluor Corp., said a bullet train going sharply downhill needs to be able to stop within a reasonable distance in case of emergency. That means a fast train would have to slow down considerably to avoid overtaxing its brakes, otherwise the wheels will melt. http://www.bakersfieldcalifornian.com/local/x167886582/High-speed-rail-faces-tough-climb-over-Tehachapis
Progress for sure! No matter how hard they try, 19th century bureaucrats still have a hard time implementing 19th century technology in the most innovative state in the world.
Where Cali Grows Green “The bigger problem with this [subsidized] spending is that it went against the economic tides. Last year Mr. Obama boasted that America would soon have 40% of the world’s manufacturing capacity in advanced electric-car batteries. But with electric cars still a rounding error in total car sales, that capacity is unneeded. Many battery makers are struggling to survive. Makers of solar panels face cheap competition from China, while natural gas from shale rock has undermined the case for electricity from solar and wind. As for high-speed rail, extensive highways, cheap air fares, and stroppy state and local governments make its viability dubious. A $3.5 billion grant to California may come to nothing as the estimated cost of that state’s high-speed rail project runs out of control.” —“End-of-Term Report,” The Economist, Sept. 1, 2012
Greenhouseeffectglobalwarmingclimatechangechaosweirding… Issues of leakage, gaming & enforcement for cap and trade overwhelm system Transportation fuels under the cap January 2015 RPS 33% by 2020 now a policy reality Difficulty implementing low carbon fuel standard Tailpipe emissions move forward Alternative energy subsidies continue to hemorrhage incubated projects to other states (Tesla, anyone?) SB 375 local air quality standards continue to pop
[Un]Intended Consequences of SB 375 Goal: “Preferred Growth Scenario” SB 375 (Steinberg, Chapter 728, Statutes of 2008) Requires each metropolitan planning organization to adopt a sustainable communities strategy in its regional transportation plan to serve as the blueprint. Result: Transit oriented communities in the Central Valley, Tehachapis? Really?
Mega Transit or Mega Sprawl? Ethan Elkind(Associate Director of the Climate Change and Business Program, with a joint appointment at UC Berkeley School of Law and UCLA School of Law) “[I]f Governor Brown really wants to leave a legacy for future generations, he should ensure that high speed rail does not exacerbate the sprawl, traffic, and environmental degradation that led made many voters to support the system in the first place.” http://legal-planet.org/2012/02/29/stopping-high-speed-sprawl/
Not all environmentalists heart HSR? In the debate on Senate Bill 901 (Vidak, 2014) that would have cut bond funds on high-speed rail on April 22, 2014, Katherine Phillips from the Sierra Club detailed how HSR will not improve GHG or criteria pollutants now or in the immediate future. See the video here (starting at 00:55:30): http://calchannel.granicus.com/MediaPlayer.php?view_id=7&clip_id=2043
One point twenty one gigawatts According to the Energy Commission’s Almanac for 2012: “With generally low hydroelectric availability in 2012, natural gas generation in California increased by 33 percent to 121,716 GWh, an increase of 30,000 GWh over the previous year…The loss of electric generation from SONGS alone accounted for approximately nine percent, or 18,000 GWh, of California's total in-state generation. The SONGS outage reduced nuclear generation in California by about 50 percent. These two factors, lower in-state hydroelectric availability and the SONGS outage, were the primary reasons for the 33 percent increase in natural gas generation in 2012.” http://energyalmanac.ca.gov/electricity/total_system_power.html
Carbon intensive transportation While the goal of high-speed rail is to displace travelers from carbon-intensive modes of transportation, like cars and planes, HSRA’s plan glosses over the facts: Cars will continue to become cleaner & more fuel efficient. Tens of thousands of acres of farm land will be fallowed to provide for the train’s necessary rights-of-way. Replacing crops with concrete eliminates a valuable carbon sink in the Central Valley where emissions are of particular concern. There has been little review of carbon intensity for all electricity generated to move these trains, much of it done before SONGS was permanently mothballed. Despite assurances that wetlands will be restored & trees will be planted to offset rail system’s emissions, it will be challenging to make system carbon neutral, let alone significantly reduce carbon emissions.
Is HSR really mitigating GHGs? HSRA estimates that the rail system will reduce GHG emissions by 4.3 million metric tons by 2030, with an additional one million metric ton reduction annually thereafter. A 2010 study by researchers at UC Berkeley concluded that it would take 71 years for HSR system just to negate emissions that will be created by the system’s construction alone. Even HSRA’s own analysis indicates that once the high-speed rail system is operational, it would contribute a relatively minor amount of emission reductions to the state at best.
Color the LAO skeptical The LAO is also skeptical of the plan to use cap and trade revenues. “…the IOS would not be completed until 2021 and Phase I blended would not be completed until 2028…given the project’s timeline, it would not help achieve AB 32’s primary goal of reducing GHG emissions by 2020.” “…an independent study found that – if the high-speed rail system met its ridership targets and renewable electricity commitments – construction and operation of the system would emit more GHG emissions than it would reduce for approximately the first 30 years.”
Reduce GHG Emissions, Not Raise New Revenue Previous years’ AB 32 bills prematurely anticipated & distributed auction revenues with insufficient information about potentially serious economic, legal and environmental impacts. The purpose of cap and trade is to reduce GHG emissions, not raise billions in new revenue for state coffers.The legislature intends to spend revenues despite their poor understanding of the serious impacts of program cost-effectiveness and emissions leakage.
Original AB 32 Debate AB 32 Joint Author & Speaker Fabian Nunez said on the final Assembly Floor debate, 8/31/2006: “The intent of the fee is for program administration and costs only, and I have a letter to the journal to specify that and I’m willing to give you my word here today that next year I’ll introduce the bill, if necessary, to make sure that happens in order that I get your support on this bill.”