BILL NUMBER: SB 1512 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY JUNE 30, 2008
AMENDED IN SENATE APRIL 17, 2008
AMENDED IN SENATE APRIL 7, 2008
INTRODUCED BY Senator Wiggins
FEBRUARY 21, 2008
An act to amend Section 25782 of the Public Resources
2827 of the Public Utilities Code, relating to
energy.
LEGISLATIVE COUNSEL'S DIGEST
SB 1512, as amended, Wiggins. Renewable energy resources:
California Solar Initiative. Private energy
producers: agricultural customer-generators.
Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including electrical corporations.
In a decision, the commission adopted the California Solar
Initiative to provide incentives to customer-side photovoltaics and
solar thermal electric projects under one megawatt. Existing law
requires the commission, in implementing the California Solar
Initiative, as defined, to authorize the award of monetary incentives
for up to the first megawatt of alternating current generated by a
solar energy system, as defined, that meets eligibility criteria
established by the State Energy Resources Conservation and
Development Commission (Energy Commission). The eligibility
requirements established by the Energy Commission include
requirements that the solar energy system is intended primarily to
offset part or all of the consumer's own electricity demand and be
located on the same premises of the end-use consumer where the
consumer's own electricity demand is located. Existing
law relative to private energy producers requires every electric
service provider, as defined, to develop a standard contract or
tariff providing for net energy metering, and to make this contract
available to eligible customer-generators, upon request, on a
first-come-first- served basis until the total rated
generating capacity used by eligible customer-generators exceeds 2.5%
of the electric service provider's aggregate customer peak demand.
Among other things, this provision includes a procedure for
calculating whether an eligible customer-generator is a net consumer
or a net producer of energy during a 12-month period.
This bill would instead require that the eligibility
requirements established by the Energy Commission include
requirements that the solar energy system is intended primarily to
offset part or all of the consumer's own electricity demand and be
located on, and is used to offset the consumer's own demand for
electricity on, contiguous property owned or leased by the consumer
, for the purpose of determining whether an
agricultural customer-generator using wind or solar electric
generation was a net consumer or a net producer of electricity during
a 12-month period, require that the electrical corporation aggregate
the electrical load of the agricultural customer-generator under the
same ownership located on property adjacent or contiguous to the
generation facility. The bill would further require that each
aggregated account be billed and measured according to a time-of-use
rate schedule .
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 2827 of the Public
Utilities Code is amended to read:
2827. (a) The Legislature finds and declares that a program to
provide net energy metering for eligible customer-generators is one
way to encourage substantial private investment in renewable energy
resources, stimulate in-state economic growth, reduce demand for
electricity during peak consumption periods, help stabilize
California's energy supply infrastructure, enhance the continued
diversification of California's energy resource mix, and reduce
interconnection and administrative costs for electricity suppliers.
(b) As used in this section, the following definitions apply:
(1) "Electric service provider" means an electrical corporation,
as defined in Section 218, a local publicly owned electric utility,
as defined in Section 9604, or an electrical cooperative, as defined
in Section 2776, or any other entity that offers electrical service.
This section shall does not apply to a
local publicly owned electric utility, as defined in Section 9604
of the Public Utilities Code , that serves more
than 750,000 customers and that also conveys water to its customers.
(2) "Eligible customer-generator" means a residential, small
commercial customer as defined in subdivision (h) of Section 331,
commercial, industrial, or agricultural customer of an electric
service provider, who uses a solar or a wind turbine electrical
generating facility, or a hybrid system of both, with a capacity of
not more than one megawatt that is located on the customer's owned,
leased, or rented premises, is interconnected and operates in
parallel with the electric grid, and is intended primarily to offset
part or all of the customer's own electrical requirements.
(3) "Net energy metering" means measuring the difference between
the electricity supplied through the electric grid and the
electricity generated by an eligible customer-generator and fed back
to the electric grid over a 12-month period as described in
subdivision (h). Net energy metering shall be accomplished using a
single meter capable of registering the flow of electricity in two
directions. An additional meter or meters to monitor the flow of
electricity in each direction may be installed with the consent of
the customer-generator, at the expense of the electric service
provider, and the additional metering shall be used only to provide
the information necessary to accurately bill or credit the
customer-generator pursuant to subdivision (h), or to collect solar
or wind electric generating system performance information for
research purposes. If the existing electrical meter of an eligible
customer-generator is not capable of measuring the flow of
electricity in two directions, the customer-generator shall be
responsible for all expenses involved in purchasing and installing a
meter that is able to measure electricity flow in two directions. If
an additional meter or meters are installed, the net energy metering
calculation shall yield a result identical to that of a single meter.
An eligible customer-generator who already owns an existing solar or
wind turbine electrical generating facility, or a hybrid system of
both, is eligible to receive net energy metering service in
accordance with this section.
(4) "Wind energy co-metering" means any wind energy project
greater than 50 kilowatts, but not exceeding one megawatt, where the
difference between the electricity supplied through the electric grid
and the electricity generated by an eligible customer-generator and
fed back to the electric grid over a 12-month period is as described
in subdivision (h). Wind energy co-metering shall be accomplished
pursuant to Section 2827.8.
(5) "Co-energy metering" means a program that is the same in all
other respects as a net energy metering program, except that the
local publicly owned electric utility, as defined in Section 9604,
has elected to apply a generation-to-generation energy and
time-of-use credit formula as provided in subdivision (i).
(6) "Ratemaking authority" means, for an electrical corporation as
defined in Section 218, or an electrical cooperative as defined in
Section 2776, the commission, and for a local publicly owned electric
utility as defined in Section 9604, the local elected body
responsible for regulating the rates of the local publicly owned
utility.
(c) (1) Every electric service provider shall develop a standard
contract or tariff providing for net energy metering, and shall make
this contract available to eligible customer-generators, upon
request, on a first-come-first-served basis until the time that the
total rated generating capacity used by eligible customer-generators
exceeds 2.5 percent of the electric service provider's aggregate
customer peak demand.
(2) On an annual basis, beginning in 2003, every electric service
provider shall make available to the ratemaking authority information
on the total rated generating capacity used by eligible
customer-generators that are customers of that provider in the
provider's service area. For those electric service providers who are
operating pursuant to Section 394, they shall make available to the
ratemaking authority the information required by this paragraph for
each eligible customer-generator that is their customer for each
service area of an electric corporation, local publicly owned
electric utility, or electrical cooperative, in which the customer
has net energy metering. The ratemaking authority shall develop a
process for making the information required by this paragraph
available to energy service providers, and for using that information
to determine when, pursuant to paragraph (3), a service provider is
not obligated to provide net energy metering to additional
customer-generators in its service area.
(3) Notwithstanding paragraph (1), an electric service provider is
not obligated to provide net energy metering to additional
customer-generators in its service area when the combined total peak
demand of all customer-generators served by all the electric service
providers in that service area furnishing net energy metering to
eligible customer-generators exceeds 2.5 percent of the aggregate
customer peak demand of those electric service providers.
(4) By January 1, 2010, the commission, in consultation with the
State Energy Resources Conservation and Development Commission, shall
submit a report to the Governor and the Legislature on the costs and
benefits of net energy metering, wind energy co-metering, and
co-energy metering to participating customers and nonparticipating
customers and with options to replace the economic costs and benefits
of net energy metering, wind energy co-metering, and co-energy
metering with a mechanism that more equitably balances the interests
of participating and nonparticipating customers, and that
incorporates the findings of the report on economic and environmental
costs and benefits of net metering required by subdivision (n).
(d) Electric service providers shall make all necessary forms and
contracts for net metering service available for download from the
Internet.
(e) (1) Every electric service provider shall ensure that requests
for establishment of net energy metering are processed in a time
period not exceeding that for similarly situated customers requesting
new electric service, but not to exceed 30 working days from the
date the electric service provider receives a completed application
form for net metering service, including a signed interconnection
agreement from an eligible customer-generator and the electric
inspection clearance from the governmental authority having
jurisdiction. If an electric service provider is unable to process
the request within the allowable timeframe, the electric service
provider shall notify both the customer-generator and the ratemaking
authority of the reason for its inability to process the request and
the expected completion date.
(2) Electric service providers shall ensure that requests for an
interconnection agreement from an eligible customer-generator are
processed in a time period not to exceed 30 working days from the
date the electric service provider receives a completed application
form from the eligible customer-generator for an interconnection
agreement. If an electric service provider is unable to process the
request within the allowable timeframe, the electric service provider
shall notify the customer-generator and the ratemaking authority of
the reason for its inability to process the request and the expected
completion date.
(f) (1) If a customer participates in direct transactions pursuant
to paragraph (1) of subdivision (b) of Section 365 with an electric
supplier that does not provide distribution service for the direct
transactions, the service provider that provides distribution service
for an eligible customer-generator is not obligated to provide net
energy metering to the customer.
(2) If a customer participates in direct transactions pursuant to
paragraph (1) of subdivision (b) of Section 365 with an electric
supplier, and the customer is an eligible customer-generator, the
service provider that provides distribution service for the direct
transactions may recover from the customer's electric service
provider the incremental costs of metering and billing service
related to net energy metering in an amount set by the ratemaking
authority.
(g) Except for the time-variant kilowatthour pricing portion of
any tariff adopted by the commission pursuant to paragraph (4) of
subdivision (a) of Section 2851, each net energy metering contract or
tariff shall be identical, with respect to rate structure, all
retail rate components, and any monthly charges, to the contract or
tariff to which the same customer would be assigned if the customer
did not use an eligible solar or wind electrical generating facility,
except that eligible customer-generators shall not be assessed
standby charges on the electrical generating capacity or the
kilowatthour production of an eligible solar or wind electrical
generating facility. The charges for all retail rate components for
eligible customer-generators shall be based exclusively on the
customer-generator's net kilowatthour consumption over a 12-month
period, without regard to the customer-generator's choice of electric
service provider. Any new or additional demand charge, standby
charge, customer charge, minimum monthly charge, interconnection
charge, or any other charge that would increase an eligible
customer-generator's costs beyond those of other customers who are
not customer-generators in the rate class to which the eligible
customer-generator would otherwise be assigned if the customer did
not own, lease, rent, or otherwise operate an eligible solar or wind
electrical generating facility are contrary to the intent of this
section, and shall not form a part of net energy metering contracts
or tariffs.
(h) For eligible residential and small commercial
customer-generators, the net energy metering calculation shall be
made by measuring the difference between the electricity supplied to
the eligible customer-generator and the electricity generated by the
eligible customer-generator and fed back to the electric grid over a
12-month period. The following rules shall apply to the annualized
net metering calculation:
(1) The eligible residential or small commercial
customer-generator shall, at the end of each 12-month period
following the date of final interconnection of the eligible
customer-generator's system with an electric service provider, and at
each anniversary date thereafter, be billed for electricity used
during that period. The electric service provider shall determine if
the eligible residential or small commercial customer-generator was a
net consumer or a net producer of electricity during that period.
(2) At the end of each 12-month period, where the electricity
supplied during the period by the electric service provider exceeds
the electricity generated by the eligible residential or small
commercial customer-generator during that same period, the eligible
residential or small commercial customer-generator is a net
electricity consumer and the electric service provider shall be owed
compensation for the eligible customer-generator's net kilowatthour
consumption over that same period. The compensation owed for the
eligible residential or small commercial customer-generator's
consumption shall be calculated as follows:
(A) For all eligible customer-generators taking service under
tariffs employing "baseline" and "over baseline" rates, any net
monthly consumption of electricity shall be calculated according to
the terms of the contract or tariff to which the same customer would
be assigned to or be eligible for if the customer was not an eligible
customer-generator. If those same customer-generators are net
generators over a billing period, the net kilowatthours generated
shall be valued at the same price per kilowatthour as the electric
service provider would charge for the baseline quantity of
electricity during that billing period, and if the number of
kilowatthours generated exceeds the baseline quantity, the excess
shall be valued at the same price per kilowatthour as the electric
service provider would charge for electricity over the baseline
quantity during that billing period.
(B) For all eligible customer-generators taking service under
tariffs employing "time of use" rates, any net monthly consumption of
electricity shall be calculated according to the terms of the
contract or tariff to which the same customer would be assigned to or
be eligible for if the customer was not an eligible
customer-generator. When those same customer-generators are net
generators during any discrete time of use period, the net
kilowatthours produced shall be valued at the same price per
kilowatthour as the electric service provider would charge for retail
kilowatthour sales during that same time of use period. If the
eligible customer-generator's time of use electrical meter is unable
to measure the flow of electricity in two directions, paragraph (3)
of subdivision (b) shall apply.
(C) For all residential and small commercial customer-generators
and for each billing period, the net balance of moneys owed to the
electric service provider for net consumption of electricity or
credits owed to the customer-generator for net generation of
electricity shall be carried forward as a monetary value until the
end of each 12-month period. For all commercial, industrial, and
agricultural customer-generators the net balance of moneys owed shall
be paid in accordance with the electric service provider's normal
billing cycle, except that if the commercial, industrial, or
agricultural customer-generator is a net electricity producer over a
normal billing cycle, any excess kilowatthours generated during the
billing cycle shall be carried over to the following billing period
as a monetary value, calculated according to the procedures set forth
in this section, and appear as a credit on the customer-generator's
account, until the end of the annual period when paragraph (3) shall
apply.
(3) (A) At the end of each 12-month period,
where the electricity generated by the eligible customer-generator
during the 12-month period exceeds the electricity supplied by the
electric service provider during that same period, the eligible
customer-generator is a net electricity producer and the electric
service provider shall retain any excess kilowatthours generated
during the prior 12-month period. The eligible customer-generator
shall not be owed any compensation for those excess kilowatthours
, unless the electric service provider enters into a
purchase agreement with the eligible customer-generator for those
excess kilowatthours.
(B) For purposes of determining whether an agricultural
customer-generator using wind or solar electric generation was a net
consumer or a net producer of electricity during that period, the
electrical corporation shall aggregate the electrical load of the
agricultural customer under the same ownership located on property
adjacent or contiguous to the generation facility. Each aggregated
account shall be billed and measured according to a time-of-use rate
schedule. Each aggregated account shall not exceed the capacity of
the eligible customer-generator specified in paragraph (2) of
subdivision (b).
(4) The electric service provider shall provide every eligible
residential or small commercial customer-generator with net
electricity consumption information with each regular bill. That
information shall include the current monetary balance owed the
electric service provider for net electricity consumed since the last
12-month period ended. Notwithstanding this subdivision, an electric
service provider shall permit that customer to pay monthly for net
energy consumed.
(5) If an eligible residential or small commercial
customer-generator terminates the customer relationship with the
electric service provider, the electric service provider shall
reconcile the eligible customer-generator's consumption and
production of electricity during any part of a 12-month period
following the last reconciliation, according to the requirements set
forth in this subdivision, except that those requirements shall apply
only to the months since the most recent 12-month bill.
(6) If an electric service provider providing net metering to a
residential or small commercial customer-generator ceases providing
that electrical service to that customer during any 12-month period,
and the customer-generator enters into a new net metering contract or
tariff with a new electric service provider, the 12-month period,
with respect to that new electric service provider, shall commence on
the date on which the new electric service provider first supplies
electric service to the customer-generator.
(i) Notwithstanding any other provisions of this section, the
following provisions shall apply to an eligible customer-generator
with a capacity of more than 10 kilowatts, but not exceeding one
megawatt, that receives electrical service from a local publicly
owned electric utility, as defined in Section 9604, that has elected
to utilize a co-energy metering program unless the electric service
provider chooses to provide service for eligible customer-generators
with a capacity of more than 10 kilowatts in accordance with
subdivisions (g) and (h):
(1) The eligible customer-generator shall be required to utilize a
meter, or multiple meters, capable of separately measuring
electricity flow in both directions. All meters shall provide
"time-of-use" measurements of electricity flow, and the customer
shall take service on a time-of-use rate schedule. If the existing
meter of the eligible customer-generator is not a time-of-use meter
or is not capable of measuring total flow of energy in both
directions, the eligible customer-generator shall be responsible for
all expenses involved in purchasing and installing a meter that is
both time-of-use and able to measure total electricity flow in both
directions. This subdivision shall not restrict the ability of an
eligible customer-generator to utilize any economic incentives
provided by a government agency or the electric service provider to
reduce its costs for purchasing and installing a time-of-use meter.
(2) The consumption of electricity from the electric service
provider shall result in a cost to the eligible customer-generator to
be priced in accordance with the standard rate charged to the
eligible customer-generator in accordance with the rate structure to
which the customer would be assigned if the customer did not use an
eligible solar or wind electrical generating facility. The generation
of electricity provided to the electric service provider shall
result in a credit to the eligible customer-generator and shall be
priced in accordance with the generation component, established under
the applicable structure to which the customer would be assigned if
the customer did not use an eligible solar or wind electrical
generating facility.
(3) All costs and credits shall be shown on the eligible
customer-generator's bill for each billing period. In any months in
which the eligible customer-generator has been a net consumer of
electricity calculated on the basis of value determined pursuant to
paragraph (2), the customer-generator shall owe to the electric
service provider the balance of electricity costs and credits during
that billing period. In any billing period in which the eligible
customer-generator has been a net producer of electricity calculated
on the basis of value determined pursuant to paragraph (2), the
electric service provider shall owe to the eligible
customer-generator the balance of electricity costs and credits
during that billing period. Any net credit to the eligible
customer-generator of electricity costs may be carried forward to
subsequent billing periods, provided that an electric service
provider may choose to carry the credit over as a kilowatthour credit
consistent with the provisions of any applicable tariff, including
any differences attributable to the time of generation of the
electricity. At the end of each 12-month period, the electric service
provider may reduce any net credit due to the eligible
customer-generator to zero.
(j) A solar or wind turbine electrical generating system, or a
hybrid system of both, used by an eligible customer-generator shall
meet all applicable safety and performance standards established by
the National Electrical Code, the Institute of Electrical and
Electronics Engineers, and accredited testing laboratories such as
Underwriters Laboratories and, where applicable, rules of the Public
Utilities Commission regarding safety and reliability. A
customer-generator whose solar or wind turbine electrical generating
system, or a hybrid system of both, meets those standards and rules
shall not be required to install additional controls, perform or pay
for additional tests, or purchase additional liability insurance.
(k) If the commission determines that there are cost or revenue
obligations for an electric corporation, as defined in Section 218,
that may not be recovered from customer-generators acting pursuant to
this section, those obligations shall remain within the customer
class from which any shortfall occurred and may not be shifted to any
other customer class. Net-metering and co-metering customers shall
not be exempt from the public benefits charge. In its report to the
Legislature, the commission shall examine different methods to ensure
that the public benefits charge remains a nonbypassable charge.
() A net metering customer shall reimburse the Department of Water
Resources for all charges that would otherwise be imposed on the
customer by the commission to recover bond-related costs pursuant to
an agreement between the commission and the Department of Water
Resources pursuant to Section 80110 of the Water Code, as well as the
costs of the department equal to the share of the department's
estimated net unavoidable power purchase contract costs attributable
to the customer. The commission shall incorporate the determination
into an existing proceeding before the commission, and shall ensure
that the charges are nonbypassable. Until the commission has made a
determination regarding the nonbypassable charges, net metering shall
continue under the same rules, procedures, terms, and conditions as
were applicable on December 31, 2002.
(m) In implementing the requirements of subdivisions (k) and (), a
customer-generator shall not be required to replace its existing
meter except as set forth in paragraph (3) of subdivision (b), nor
shall the electric service provider require additional measurement of
usage beyond that which is necessary for customers in the same rate
class as the eligible customer-generator.
(n) On or before January 1, 2005, the commission shall submit a
report to the Governor and the Legislature that assesses the economic
and environmental costs and benefits of net metering to
customer-generators, ratepayers, and utilities, including any
beneficial and adverse effects on public benefit programs and special
purpose surcharges. The report shall be prepared by an independent
party under contract with the commission.
(o) It is the intent of the Legislature that the Treasurer
incorporate net energy metering and co-energy metering projects
undertaken pursuant to this section as sustainable building methods
or distributive energy technologies for purposes of evaluating
low-income housing projects.
SECTION 1. (a) It is the intent of the
Legislature that the California Solar Initiative permit a property
owner with multiple meters providing service to their property, to
install a solar energy system that is large enough to offset all of
the electrical demand for the entire property, provided that in order
to be eligible for net energy metering, the property is rewired or
otherwise metered so that it complies with paragraph (3) of
subdivision (b) of Section 2827 of the Public Utilities Code.
(b) It is the further intent of the Legislature that any
additional costs to rewire or alter the metering of the property to
comply with paragraph (3) of subdivision (b) of Section 2827 of the
Public Utilities Code, and additional costs to upgrade the electrical
service to the property to accommodate the solar energy system that
are not currently allowed or offered by the California Solar
Initiative, are the responsibility of the eligible customer-generator
and shall not be passed on to other ratepayers.
SEC. 2. Section 25782 of the Public Resources
Code is amended to read:
25782. (a) The commission shall, by January 1, 2008, in
consultation with the Public Utilities Commission, local publicly
owned electric utilities, and interested members of the public,
establish eligibility criteria for solar energy systems receiving
ratepayer funded incentives that include all of the following:
(1) Design, installation, and electrical output standards or
incentives.
(2) The solar energy system is intended primarily to offset part
or all of the consumer's own electricity demand on contiguous
property owned or leased by the consumer.
(3) All components in the solar energy system are new and unused,
and have not previously been placed in service
in any other location or for any other
application.
(4) The solar energy system has a warranty of not less than 10
years to protect against defects and undue degradation of electrical
generation output.
(5) The solar energy system is located on, and is used to offset
the consumer's own demand for electricity on, contiguous property
owned or leased by the consumer.
(6) The solar energy system is connected to the electrical
corporation's electrical distribution system within the state.
(7) The solar energy system has meters or other devices in place
to monitor and measure the system's performance and the quantity of
electricity generated by the system.
(8) The solar energy system is installed in conformance with the
manufacturer's specifications and in compliance with all applicable
electrical and building code standards.
(b) The commission shall establish conditions on ratepayer funded
incentives that require all of the following:
(1) Appropriate siting and high quality installation of the solar
energy system by developing installation guidelines that maximize the
performance of the system and prevent qualified systems from being
inefficiently or inappropriately installed. The conditions
established by the commission shall not impact housing designs or
densities presently authorized by a city, county, or city and county.
The goal of this paragraph is to achieve efficient installation of
solar energy systems to promote the greatest energy production per
ratepayer dollar.
(2) Optimal solar energy system performance during periods of peak
electricity demand.
(3) Appropriate energy efficiency improvements in the new or
existing home or commercial structure where the solar energy system
is installed.
(c) The commission shall set rating standards for equipment,
components, and systems to assure reasonable performance and shall
develop standards that provide for compliance with the minimum
ratings.
(d) Upon establishment of eligibility criteria pursuant to
subdivision (a), no ratepayer funded incentives shall be made for a
solar energy system that does not meet the eligibility criteria.