BILL NUMBER: SB 1438 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY JUNE 30, 2008
AMENDED IN ASSEMBLY JUNE 16, 2008
AMENDED IN SENATE MAY 20, 2008
AMENDED IN SENATE APRIL 22, 2008
AMENDED IN SENATE APRIL 9, 2008
INTRODUCED BY Senator Padilla
(Coauthor: Senator Cedillo)
(Coauthors: Assembly Members Huffman and Tran)
FEBRUARY 21, 2008
An act to add Chapter 4 (commencing with Section 8360) to Division
4.1 of the Public Utilities Code, relating to electricity.
LEGISLATIVE COUNSEL'S DIGEST
SB 1438, as amended, Padilla. Electricity: smart grid systems.
Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including electrical corporations,
as defined. Under existing law, the governing board of a local
publicly owned electric utility, as defined, generally has authority
over the activities of the utility.
This bill would require the commission, by July 1, 2010, and in
consultation with the State Energy Resources Conservation and
Development Commission (Energy Commission) and the Independent System
Operator (ISO), to determine the requirements for a smart grid
deployment plan consistent with the policies set forth in the bill
and federal law. The bill would require that the smart grid improve
overall efficiency, reliability, and cost-effectiveness of electrical
system operations, planning, and maintenance. The bill would require
each electrical corporation, by July 1, 2011, to develop and submit
a smart grid deployment plan to the commission for approval and would
authorize the commission to authorize an electrical corporation to
recover reasonable costs of deploying smart grid technologies and
services from ratepayers. The bill would authorize a smart grid
deployment plan that is adopted to provide for deployment of smart
grid products, technologies, and services by entities other than
electrical corporations. The bill would authorize smart grid
technologies and services to be deployed in an incremental manner to
maximize the benefit to ratepayers and to achieve the benefits of
smart grid technology, would authorize the commission to modify or
adjust the bill's requirements for any electrical corporation with
fewer than 100,000 service connections as individual circumstances
merit, and would require the commission in consultation with the
Energy Commission, the ISO, and the electrical corporations, at each
step of deployment, to evaluate the impact of deployment on major
initiatives and policies.
The bill would require a local publicly owned electric utility, as
defined, to develop by July 1, 2011, and adopt by July 1,
2012, a smart grid deployment plan consistent with the
policies set forth in the bill and federal law. By
placing requirements upon local publicly owned electric utilities,
the bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Chapter 4 (commencing with Section 8360) is added to
Division 4.1 of the Public Utilities Code, to read:
CHAPTER 4. SMART GRID SYSTEMS
8360. It is the policy of the state to modernize the state's
electrical transmission and distribution system to maintain reliable
and secure electrical service, with infrastructure that can meet
future growth in demand and achieve all of the following, which
together characterize a smart grid:
(a) Increased use of cost-effective digital information
and control technology to improve reliability, security, and
efficiency of the electric grid.
(b) Dynamic optimization of grid operations and resources, with
cost-effective full cyber security.
(c) Deployment and integration of cost-effective
distributed resources and generation, including renewable resources.
(d) Development and incorporation of cost-effective
demand response, demand-side resources, and energy-efficiency
resources.
(e) Deployment of cost-effective smart technologies,
including real time, automated, interactive technologies that
optimize the physical operation of appliances and consumer devices
for metering, communications concerning grid operations and status,
and distribution automation.
(f) Integration of cost-effective smart appliances and
consumer devices.
(g) Deployment and integration of cost-effective
advanced electricity storage and peak-shaving technologies, including
plug-in electric and hybrid electric vehicles, and thermal-storage
air-conditioning.
(h) Provide consumers with timely information and control options.
(i) Develop standards for communication and interoperability of
appliances and equipment connected to the electric grid, including
the infrastructure serving the grid.
(j) Identification and lowering of unreasonable or unnecessary
barriers to adoption of smart grid technologies, practices, and
services.
8361. For purposes of this chapter , the following
terms have the following meanings:
(a) "ISO" means the Independent System Operator operating pursuant
to Article 3 (commencing with Section 345) of Chapter 2.3 of Part 1
of Division 1.
(b) "Energy Commission" means the State Energy Resource
Conservation and Development Commission.
8362. (a) By July 1, 2010, the commission, in consultation with
the Energy Commission and the ISO, shall determine the requirements
for a smart grid deployment plan consistent with Section 8360 and
federal law, including the provisions of Title XIII (commencing with
Section 1301) of the Energy Independence and Security Act of 2007
(Public Law 110-140). The commission shall institute a rulemaking or
expand the scope of an existing rulemaking to adopt standards and
protocols to ensure functionality and interoperability developed by
public and private entities, including, but not limited to, the
National Institute of Standards and Technology, Gridwise Architecture
Council, the International Electrical and Electronics Engineers, and
the National Electric Reliability Organization recognized by the
Federal Electric Reliability Commission. Any adopted smart grid
deployment plan may provide for deployment of cost-effective
smart grid products, technologies, and services by entities
other than electrical corporations. The smart grid technologies and
services shall , improve overall efficiency,
reliability, and cost-effectiveness of electrical system operations,
planning, and maintenance.
(b) This section does not require or authorize the commission to
delay action on any application by an electrical corporation that is
submitted prior to the commission determining the requirements for a
smart grid deployment plan.
8364. (a) By July 1, 2011, each electrical corporation shall
develop and submit a smart grid deployment plan to the commission for
approval.
(b) The commission may authorize an electrical corporation to
recover reasonable costs of deploying smart grid technologies and
services from ratepayers. Costs may include capital investment,
including a reasonable rate of return on the capital expenditures,
operating expenditures, and other reasonable costs of the electrical
corporation made for the deployment of the qualified smart grid
system. The commission may modify or adjust the requirements of this
chapter for any electrical corporation with fewer than 100,000
service connections, as individual circumstances merit.
(c) This section does not require or authorize the commission to
delay action on any application by an electrical corporation that is
submitted prior to the commission's approval of the electrical
corporation's timely-filed smart grid deployment plan.
8366. Smart grid technology may be deployed in an incremental
manner to maximize the benefit to ratepayers and to achieve the
benefits of smart grid technology. At each step of deployment, the
commission in consultation with the Energy Commission, the ISO, and
the electrical corporations, shall evaluate the impact of deployment
on major initiatives and policies including:
(a) Implementation of new advanced metering initiatives.
(b) Achievement of the renewables portfolio standard program
requirements and the need to operate the smart grid of the future
with a substantial increased percentage of electricity generated by
eligible renewable energy resources.
(c) Achievement of state goals for reducing emissions of
greenhouse gases reduction goals as set forth in the Global Warming
Solutions Act of 2006 and other state directives.
(d) Achievement of the energy efficiency and demand response goals
as required by Sections 454.5 and 454.55 and other state directives.
(e) Modernize the aging utility grid infrastructure.
(f) Meet the future energy growth needs of the state with new and
innovative technologies and methods that utilize the existing assets
more efficiently, result in less environment
environmental impact on the state, meet stringent costs versus
benefit assessments, and provide the ratepayers with new options in
meeting their individual energy needs.
8367. Each local publicly owned electric utility, as defined in
Section 9604 , with more than 100,000 service connections
, shall, by July 1, 2011, develop , and by July 1, 2012,
adopt, a smart grid deployment plan, that is consistent
with the provisions of this chapter and federal
law, including the provisions of Title XIII (commencing with Section
1301) of the Energy Independence and Security Act of 2007 (Public Law
110-140).
SEC. 2. No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because a
local agency or school district has the authority to levy service
charges, fees, or assessments sufficient to pay for the program or
level of service mandated by this act, within the meaning of Section
17556 of the Government Code.