BILL ANALYSIS                                                                                                                                                                                                    

                                                               SB 1340

                        Senator S. Joseph Simitian, Chairman
                              2009-2010 Regular Session
           BILL NO:    SB 1340
           AUTHOR:     Kehoe
           AMENDED:    Introduced
           FISCAL:     Yes               HEARING DATE:     April 19, 2010
           URGENCY:    No                CONSULTANT:       Caroll  

            SUMMARY  :    
            Existing law  , under the California Alternative and Renewable  
           Fuel, Vehicle Technology, Clean Air, and Carbon Reduction Act  
           of 2007 (Health and Safety Code 44270 et seq.):

           1) Contains general provisions relating to both the  
              Alternative and Renewable Fuel and Vehicle Technology  
              Program and the Air Quality Improvement Program that:

              a)    Defines "full fuel-cycle assessment" to be an  
                 evaluation and comparison of environmental and health  
                 impacts in the life cycle of fuel, including certain  
                 matters (e.g., feedstock production, fuel production,  
                 and vehicle operation).

              b)    Authorizes the State Energy Resources Conservation  
                 and Development Commission (CEC) and the State Air  
                 Resources Board (ARB) to determine definitions of terms  
                 used for the programs and to identify revenue streams  
                 for programs.

              c)    Provides that for purposes of both programs, eligible  
                 projects cannot include those required to be undertaken  
                 pursuant to state or federal law.

           2) Creates the Alternative and Renewable Fuel and Vehicle  
              Technology Program that:


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              a)    Requires the CEC to provide competitive grants,  
                 revolving loans, loan guarantees, or loans to certain  
                 interests (e.g., public agencies, businesses, fleet  
                 owners, consumers) to develop and deploy innovative  
                 technologies  that change the state's fuel and vehicle  
                 types to help attain the state's climate change  
                 policies.  (44272(a)).

              b)    Requires the CEC to provide preferences to those  
                 projects maximizing the program goals based on certain  
                 project criteria (e.g., consistency with climate change  
                 policy, ability to reduce criteria air pollutants and  
                 air toxics, provide nonstate matching funds).   

              c)    Lists projects eligible for funding under the  

              d)    Provides single source contract authority.

              e)    Provides funding through various fees.

           3) Under the California Global Warming Solutions Act of 2006  
              (CGWSA) (Health and Safety Code 38500 et seq.):

              a)    Requires the ARB to determine the 1990 statewide  
                 greenhouse gas (GHG) emissions level and approve a  
                 statewide GHG emissions limit that is equivalent to that  
                 level, to be achieved by 2020, and sets various  
                 requirements to meet this requirement.  

              b)    Requires ARB to develop a "Scoping Plan" that  
                 provides guidelines on achieving GHG reductions.

            This bill  :

           1)Clarifies that funding from the Alternative and Renewable  
             Fuel and Vehicle Technology Program may be made available to  
             homeowners of electric vehicles to retrofit their electrical  
             sources for an in-home charging station.

           2)Deletes an obsolete reference.


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            COMMENTS  :

            1) Purpose of Bill  .  According to the author, "Currently the  
              Alternative and Renewable Fuel and Vehicle Technology  
              Program does not have a program set up to address the needs  
              of plug-in electric vehicles (PEV's) or plug-in hybrid  
              electric vehicle (PHEV's) owners who will have to have  
              their homes (garage to power-box) upgraded to handle the  
              additional power needs of these vehicles to properly and  
              safely charge them."

            2) Background  .  The Alternative and Renewable Fuel and Vehicle  
              Technology Program authorizes the CEC to develop and deploy  
              alternative and renewable fuels and advanced transportation  
              technologies to help attain the state's climate change  
              policies.  CEC has an annual program budget of  
              approximately $100 million to support projects that:
                  Develop and improve alternative and renewable  
                low-carbon fuels. 
                  Optimize alternative and renewable fuels for existing  
                and developing engine technologies. 
                  Produce alternative and renewable low-carbon fuels in  
                  Decrease, on a full fuel cycle basis, the overall  
                impact and carbon footprint of alternative and renewable  
                fuels and increase sustainability. 
                  Expand fuel infrastructure, fueling stations, and  
                  Improve light-, medium-, and heavy-duty vehicle  
                  Retrofit medium- and heavy-duty on-road and non-road  
                vehicle fleets. 
                  Expand infrastructure connected with existing fleets,  
                public transit, and transportation corridors. 
                  Establish workforce training programs, conduct public  
                education and promotion, and create technology centers. 

             The funds come from additonal fees on vehicle and vessel  
             registrations as well as $10 million from The Public  
             Interest Research, Development and Demonstration Fund.

             The December 2008 ARB Scoping Plan identified on-road  
             transportation as the single largest sector responsible for  


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             California GHG emissions representing 36% of all emissions.   
             A 2010 Public Policy Institute of California study, Climate  
             Change Challenges, Vehicle Emissions and Public Health in  
             California, concluded that increased use of battery-electric  
             vehicles would provide the greatest public health benefit  
             per unit of GHG emission reduction among the possible  
             alternative fueling and vehicle technologies on the horizon.  
              The report also notes, however, that electric vehicles  
             involve "high cost and uncertainty" because they "depend on  
             technological breakthroughs and broader market penetration  
             to reduce cost and meet performance targets."

            1) Clarification  .  CEC does not currently have an electrical  
              vehicle upgrade program in place.  The Alternative and  
              Renewable Fuel and Vehicle Technology Program provides that  
              "Alternative and renewable fuel infrastructure, fueling  
              stations, and equipment" shall be eligible for funding  
              under this program.  Alternative and renewable fuel  
              projects include "electricity, ethanol, dimethyl ether,  
              renewable diesel, natural gas, hydrogen, and biomethane  
              among others."  Taken together, it would seem that CEC  
              currently has the authority to create a program such as the  
              one in this bill.  This bill clarifies that cost offsets  
              for in-home charging stations are an eligible expense. 

            2) Recommendations  .  The author may wish to amend line 1-13,  
              page 5 to read, "A  cost-effective  program to provide  
              funding for homeowners who purchase a  plug-in  electric  
              vehicle to offset costs associated with modifying  
              electrical sources to include  an in-home   a residential  
              plug-in  electric vehicle charging station" for  
              clarification purposes.

            3) Related legislation  .  AB 1304 (Saldana, 2009) would have  
              exempted the sale, storage, use, or other consumption of  
              electric vehicles from sales tax until January 1, 2015.   
              (Held in Assembly Appropriations Committee.)

            4) Previous Committee  .  SB 1340 was approved by the Senate  
              Transportation and Housing Committee on April 6, 2010  

            SOURCE  :        Senator Kehoe  


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           SUPPORT  :       California Air Pollution Control Officer's  
                          Association, Bay Area Quality Management  
                          District, Nissan North America, Sierra Club  

           OPPOSITION  :    None on file