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Friday, Jan 27, 2023
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Making Constructive Use of AB 32 Funds

San Diego is one of the world’s most modern and beautiful cities. From the Santa Fe Depot to the University of San Diego’s Spanish Renaissance façades, we have a reputation for architectural excellence. But there’s always room for improvement where energy efficiency is concerned.

Buildings take a lot of energy, both to maintain and to build. California’s landmark clean energy bill AB 32 is providing an opportunity to re-imagine and implement a new energy vision for both San Diego and the state, moving from the expensive, dirty, imported fossil fuels of the past, to high-tech, efficient, cost-effective energy systems of the future. And along the way, our economy and our environment are benefitting.

The law states that any money raised from the auctioning of pollution permits under AB 32’s market-based cap and trade program should be spent on reducing climate change impacts and greenhouse gas emissions. For the San Diego metro area, transforming the ways buildings and communities are designed, built and operated are among the best ways to achieve the law’s goals.

A Big Source of Emissions

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According to an analysis by the University of San Diego School of Law’s Energy Policy Initiatives Center, residential and commercial buildings account for about 28 percent of annual greenhouse gas emissions in San Diego County. Buildings account for more emissions than any other source except for cars and trucks.

Building efficiency upgrades are low-hanging fruit — they are investments that allow owners and tenants to save money over time. For example, the well-respected firm Collaborative Economics found simple energy efficiency improvements to existing buildings yield $3 in savings, on average, for every $1 invested. And there are benefits for our broader society, as well.

Cutting Consumption

Cost-effective energy efficient upgrades in existing buildings could cut statewide electricity consumption by 9 percent, and shave 11 percent off of peak demand, according to a report from the San Diego Workforce Partnership and Cuyamaca College. That means less pressure on the grid, and less pressure for rate hikes. It also means well-paying jobs for the hard-hit construction industry.

Once AB 32 is fully implemented, California families will save money at home, too. The state’s Air Resources Board expects Californians to spend five percent less on electricity due to AB 32. That’s in keeping with California’s previous experience: smart energy policies saved households $56 billion in energy costs between 1972 and 2006, according to the California Energy Commission.

Because the growing efficiency and renewable sector is contributing to a healthier economy, San Diegans and Californians will be the beneficiaries of the state’s forward-thinking clean energy policies. An economic analysis conducted by Next 10 forecasts that overall, AB 32 will result in a $76 billion increase in California’s gross state product, a $48 billion increase in real household incomes, and the creation of 403,000 new jobs.

Our city has the opportunity for economic prosperity in an arena we have led in for years: designing, constructing and maintaining world-class buildings. AB 32 is helping to propel San Diego forward as a shining example of how efficiency and sustainability can be done right.

Doug Kot is executive director of the U.S. Green Building Council-San Diego. Dennis Murphy is the founding chair of the U.S. Green Building Council California.

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