This report offers a quantitative assessment of the economic impacts of three of California’s major climate programs and policies in the Valley: cap and trade, the renewables portfolio standard, and investor-owned utility (IOU) energy efficiency programs.

The San Joaquin Valley plays a critical role in shaping California’s climate policy and is worthy of study due to its function as a bellwether of the state’s transition to a low-carbon economy. Reducing emissions is vitally important for the San Joaquin Valley. The Valley’s topography traps pollution, and air quality and the resulting health conditions are far worse in the Valley than in other region of the state. The region also faces more socioeconomic challenges than the state as a whole. Thus the Valley is vulnerable to both climate change and to climate policy. If policymakers can make climate policy work for the Valley, it will work for the state and demonstrate that these policies and programs can work for vulnerable communities around the world.

In the California Legislature, some San Joaquin Valley (“Valley”) representatives have raised concerns about the impact the state’s climate policy and programs could have on jobs. But claims and counter-claims about the economic impact of climate policies have been wielded in an informational vacuum. To date, no comprehensive independent or academic study has sought to calculate and analyze current and future economic impacts of state climate policies within the San Joaquin Valley, comprised of the eight counties of Fresno, Madera, Merced, Kern, Kings, San Joaquin, Stanislaus, and Tulare. Together, these counties represent 11 percent of the state’s population.

This report offers a quantitative assessment of the net economic impacts between 2010 and 2016 in the Inland Empire of four of California’s major climate programs and policies.

This analysis presents costs and benefits to the Inland Empire economy—including job gain and loss—of cap and trade, the RPS, distributed solar programs, and energy efficiency programs overseen by the CPUC. We used publicly available data to determine the costs and benefits of these programs between 2010–16, and then modeled the regional economic impacts using IMPLAN. after accounting for the full costs of these programs to industry, the region received $9.1 billion more than was spent, and saw 41,000 more jobs gained than were lost. When accounting for the ripple effects of this influx of capital (the secondary and tertiary spending that occurs), the Inland Empire saw a total of $14.2 billion in economic activity and 73,000 jobs as a results of California’s major climate programs. Over 90 percent of the direct impact is due to the proliferation of renewable energy powerplants in the region.

California’s long-term economic prosperity and environmental sustainability will depend on how much and where housing gets built in the state. Residents in the largest coastal cities in California encounter some of the most unaffordable homes in the nation, caused in large part by a thriving economy and a multi-decade-long undersupply of housing relative to population and job growth. In addition to the income squeeze of unaffordable homes and long commutes, the housing shortage creates environmental challenges. Most prominently, building more auto-dependent housing far from job centers generates more traffic and air pollution while destroying open space and agricultural lands. Furthermore, these development patterns undermine that state’s long-term greenhouse gas reduction goals, including newly legislated 2030 targets. California instead could meet long-term economic and environmental objectives by building the right type of housing in the right places. That means homes that allow for reduced driving, as well as less energy and water usage, with compact development near transit, goods, and services. Other than one industry-based analysis, California has lacked an objective and comprehensive assessment of the potential economic and environmental impacts of new housing production on the state’s 2030 climate goals. To address this research gap, the Center for Law, Energy, and the Environment (CLEE) at UC Berkeley School of Law and the Terner Center for Housing Innovation at UC Berkeley (collectively the “Centers”), with support from Next 10, prepared this report to assess the environmental and economic impacts of housing production scenarios that could help meet the state’s proposed 2030 greenhouse gas reduction target under Senate Bill 32 (Pavley, 2016). This report also offers best practices and policy recommendations for state and local governments to boost housing production within California’s existing urban footprint. The Centers have assessed existing data and consulted with development experts to quantify the costs and benefits of a 2030 growth scenario that can inform state and local policy going forward.