In good news for California’s industrial sector, yesterday evening Governor Gavin Newsom signed AB 1280 into law. Authored by Assemblymember Robert Garcia (D–Rancho Cucamonga), the bill will help modernize California’s manufacturing sector by expanding incentive programs for the deployment of clean industrial equipment through the California Energy Commission’s Industrial Decarbonization and Improvement of Grid Operations grant program (INDIGO) and the IBank’s Climate Catalyst Fund. The bill was sponsored by Industrious Labs and Earthjustice.
“AB 1280 is a big win for California’s economy and our environment,” said Assemblymember Robert Garcia. “This bill will make it easier for manufacturers to adopt clean technologies and create good-paying jobs, making our businesses more competitive and our communities healthier.”
“We thank Governor Newsom for signing AB 1280 to help California manufacturers shift to zero-emissions equipment like heat pumps and thermal energy storage,” said Adrian Martinez, Director of Earthjustice’s Right To Zero campaign. “This legislation is a critical early step in modernizing California’s industrial sector — and next year, we hope to see Governor Newsom and the Legislature invest funds from cap and invest in the INDIGO program to ensure we keep pace with the rest of the world in the big shift to clean industrial equipment. In the end, it’ll deliver better health to Californians from the cradle to old age.”
“Investing in clean manufacturing is a golden opportunity for California,” said Teresa Cheng, California Director at Industrious Labs. “Industry is a major source of pollution, but it’s also a pillar of our economy, and it can be part of the solution. We have the tools to cut industrial pollution and keep manufacturing jobs here in the state. What’s missing is implementation — and AB 1280 delivers that. State investment is critical to keeping California’s manufacturing sector competitive and a leader in adopting clean technology.”
Today, California’s industrial sector emits one-fifth of the state’s climate pollution. But nearly half of all heating emissions from the manufacturing sector can be eliminated by replacing fossil-fueled equipment with more efficient zero-emissions equipment that is already commercially available. The legislation will make it easier for manufacturers to afford these upgrades by providing grants from INDIGO and loans through California’s Green Bank — an effort that finances projects that promote sustainability.
Manufacturers that receive funds through the program will be required to meet strong labor standards and the program will prioritize projects in areas that experience the worst industrial pollution. The legislation enjoyed especially robust support from labor in California.
“Governor Newsom’s signature on AB 1280 is a major win for working families,” said Vince Sugrue, State Legislative Director for Sheet Metal Workers Local Union No. 104. “This bill helps ensure that California continues to invest in high-road, middle-class careers while accelerating our state’s clean energy transition. By putting skilled labor at the center of the solution, we’re building a cleaner, fairer future that uplifts workers and communities alike.”
The bill’s twin benefits of modernizing manufacturing while cleaning California’s air earned it broad bipartisan support from manufacturers, environmental justice and climate groups, and the state building and construction trades.
California has the largest manufacturing sector in the United States. It’s a huge driver of the state’s economy — contributing about $400 billion annually in GDP — and it is also a major source of pollution. Despite the availability of proven clean industrial solutions, less than 1% of the state’s Greenhouse Gas Reduction Fund has gone to industrial decarbonization since 2014.
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