California Assembly advances climate credit bill AB 745 to reduce utility costs

The Assembly Utilities and Energy Committee of the California State Assembly convened on June 3, 2025, to discuss significant legislative measures aimed at addressing climate credits and utility rates. The meeting highlighted Assembly Bill 745, which proposes the application of climate credits to volumetric rates, a move supported by various stakeholders, including environmental organizations and utility representatives.

Michelle Canales from the Union of Concerned Scientists emphasized the importance of redirecting gas climate credits to help reduce specific utility rates. Joe Guardia from the Natural Resources Defense Council echoed this sentiment, advocating for amendments that would ensure climate credits are applied consistently throughout the year. Meanwhile, representatives from Pacific Gas and Electric and Southern California Edison expressed their intent to collaborate on the bill, particularly concerning its implications for low-income customers.

Scott Wetscher, representing the California Coalition of Utility Employees, raised concerns about the bill's impact on Net Energy Metering (NEM) 1 customers, suggesting that they may not require additional climate credits due to existing benefits from utility rate increases. This perspective underscores the ongoing debate about how best to allocate climate credits to support those most in need.

Assemblymember Zibur, who supported the bill, clarified that it was designed to complement existing cap-and-trade efforts without overlapping with them. He noted that the bill aims to enhance affordability for consumers while respecting the legislative framework established by Assemblymember Erwin's cap-and-trade initiatives.

The committee ultimately voted in favor of AB 745, with a unanimous decision to advance the bill to the floor for further consideration. This decision reflects a growing recognition of the need to address the financial burdens faced by Californians, particularly in light of rising utility costs.

As the committee moved on to discuss Assembly Bill 825, Assemblymember Calderon highlighted the pressing issue of the cost of living in California, which remains a top concern for many residents. The discussions from this meeting signal a proactive approach by the California State Assembly to tackle the intertwined challenges of climate policy and economic hardship, setting the stage for future legislative actions aimed at improving the lives of Californians.