BILL ANALYSIS
AB 1947
Page 1
ASSEMBLY THIRD READING
AB 1947 (Fong and Jones)
As Amended March 25, 2010
Majority vote
UTILITIES & COMMERCE 8-6
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|Ayes:|Bradford, Carter, Fong, | | |
| |Fuentes, Furutani, Ma, | | |
| |Skinner, Swanson | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Knight, Tom Berryhill, | | |
| |Fletcher, Fuller, | | |
| |Huffman, Villines | | |
| | | | |
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SUMMARY : Permits a publicly owned utility (POU) to implement a
solar program that allows customers to offset part or all of
their electricity demand, with a solar energy system not located
on the premises of the consumer.
EXISTING LAW :
1)Requires each POU to annually report to the California Energy
Commission (CEC) the amount of funds collected and expended
for renewable energy resource development and the utility's
status in implementing the Renewable Portfolio Standard (RPS),
which requires all electric utilities to procure at least 20%
of their generating capacity from renewable energy generating
sources by 2010.
2)Requires a POU to offer monetary incentives for the
installation of solar energy systems.
3)Establishes the California Solar Initiative (CSI), which sets
a goal for investor-owned utilities (IOUs) and POUs to install
3,000 megawatts of photovoltaic (PV) solar energy in
California within 10 years.
4)Establishes criteria for a POU's solar energy program,
including that the solar energy system be located on the same
premises of the end-use consumer where the consumer's own
AB 1947
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electricity demand is located, and is intended to offset part
or all of that customer's demand.
FISCAL EFFECT : Unknown
COMMENTS : This bill is intended to assist a POU with achieving
its CSI goals. In the IOU territories, because of deregulation
and the energy crisis, rates are high enough to provide
individual customers incentive to invest in solar PV panels to
offset their own load. This takes a substantial up-front
investment for an average single-family home and the payback
period is usually about five years or less. Because the
Sacramento Municipal Utility District (SMUD) and other POUs'
retail prices can be substantially less, it takes longer for the
investment to pay off and customers are less likely to invest in
solar PV for financial reasons if they have to install it on
their own premises.
SMUD has created an alternative program that would enable those
customers who choose to contribute toward solar PV generation to
participate without having to make the substantial up-front
investment with such a lengthy pay-back period. Current law
precludes SMUD from implementing it because the law requires
that the solar energy system be located on the same premises of
the end-use customer where the customer's own electricity demand
is located.
As directed by CSI, SMUD has been collecting CSI but because of
its lower rates, many ratepayers who are paying the solar
surcharge remain unable or unwilling to install solar on their
rooftops.
To more widely distribute the benefits of CSI collections, SMUD
created a Solar Shares pilot program. Customers who choose to
participate in the Solar Shares program pay a monthly fee in
exchange for a portion of their electricity to come from locally
sourced solar. Those customers also receive a monthly credit on
their electricity bill based on their proportion of the solar
energy system's expected output. SMUD's customers who choose to
participate in the Solar Shares program pay an additional
monthly charge of $6 and SMUD will meet 100% of that customer's
electricity needs with power from renewable resources. For $3
per month, 50% of that customer's electricity will be met with
renewable resources. Commercial customers can choose to pay an
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additional monthly charge of $20 and SMUD will meet up to 2,000
kWh per month of the business' electricity needs from renewable
generation; the amount used by the average small business.
According to SMUD, by requiring on-site solar panels, many
ratepayers who pay for CSI cannot take advantage of it. SMUD
lists a number of situations where rooftop solar PV doesn't
work. Renters or businesses that lease commercial space will
not install solar panels on someone else's property. Some roofs
may not generate the optimal output of the solar panels because
they are either shaded, steeply pitched, or facing north or
east.
Analysis Prepared by : Gina Adams / U. & C. / (916) 319-2083
FN: 0003844