BILL NUMBER: AB 1150 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY MAY 27, 2011
AMENDED IN ASSEMBLY MAY 11, 2011
AMENDED IN ASSEMBLY APRIL 28, 2011
AMENDED IN ASSEMBLY APRIL 25, 2011
AMENDED IN ASSEMBLY MARCH 29, 2011
INTRODUCED BY Assembly Member V. Manuel Pérez
FEBRUARY 18, 2011
An act to amend Section 379.6 of the Public Utilities Code,
relating to electricity.
LEGISLATIVE COUNSEL'S DIGEST
AB 1150, as amended, V. Manuel Pérez. Self-generation incentive
program.
Under existing law, the Public Utilities Commission (PUC) has
regulatory authority over public utilities, including electrical
corporations, as defined. Existing law requires the PUC to
administer, until January 1, 2016, a self-generation incentive
program (SGIP) for distributed generation resources and to separately
administer solar technologies pursuant to the California Solar
Initiative. The PUC, in consultation with the State Energy Resources
Conservation and Development Commission (Energy Commission), may
authorize electrical corporations to annually collect not more than
the amount authorized for the SGIP in the 2008 calendar year through
December 31, 2011.
This bill would expand extend the
authority of the PUC to authorize electrical corporations to continue
making the annual collections through December 31, 2014, as
provided, and would require the PUC to continue to administer the
program until January 1, 2018. The bill would require the PUC to
transition the program to performance-based incentives, so that
incentive payments are earned based on the actual electrical output
of the distributed energy resource. The bill would require the PUC to
require, for an incentive payment received on the basis that the
distributed energy project uses a renewable fuel, confirmation of the
physical delivery of the renewable fuel to the project or to the
California pipeline system, in an amount equivalent to the fuel
requirements of the project for the life of the project. The bill
would delete provisions requiring combustion-operated distributed
generation projects using fossil fuel to meet specified emission
requirements, and instead require eligible distributed energy
projects to meet applicable State Air Resources Board certification
standards and applicable air pollution control district or air
quality management district permitting standards. The bill would
require the PUC to periodically evaluate the program to adjust the
amount of rebates and other program design elements to achieve
specified program goals and objectives 2012 .
Under existing law, a violation of the Public Utilities Act or any
order, decision, rule, direction, demand, or requirement of the
commission is a crime.
Because the program that is extended under the provisions of this
bill are within the act and a decision or order of the commission
implements the program requirements, a violation of these provisions
would impose a state-mandated local program by expanding the
definition of a crime.
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. Section 379.6 of the Public
Utilities Code is amended to read:
379.6. (a) (1) The commission, in consultation with the Energy
Commission, may authorize the annual collection of not more than the
amount authorized for the self-generation incentive program in the
2008 calendar year, through December 31, 2011
2012 . The commission shall require the administration of the
program for distributed energy resources originally established
pursuant to Chapter 329 of the Statutes of 2000 until January 1,
2016. On January 1, 2016, the commission shall provide repayment of
all unallocated funds collected pursuant to this section to reduce
ratepayer costs.
(2) The commission shall administer solar technologies separately,
pursuant to the California Solar Initiative adopted by the
commission in Decision 06-01-024.
(b) Eligibility for incentives under the program shall be limited
to distributed energy resources that the commission, in consultation
with the State Air Resources Board, determines will achieve
reductions of greenhouse gas emissions pursuant to the California
Global Warming Solutions Act of 2006 (Division 25.5 (commencing with
Section 38500) of the Health and Safety Code).
(c) Eligibility for the funding of any combustion-operated
distributed generation projects using fossil fuel is subject to all
of the following conditions:
(1) An oxides of nitrogen (NOx) emissions rate standard of 0.07
pounds per megawatthour and a minimum efficiency of 60 percent, or
any other NOx emissions rate and minimum efficiency standard adopted
by the State Air Resources Board. A minimum efficiency of 60 percent
shall be measured as useful energy output divided by fuel input. The
efficiency determination shall be based on 100 percent load.
(2) Combined heat and power units that meet the 60-percent
efficiency standard may take a credit to meet the applicable NOx
emissions standard of 0.07 pounds per megawatthour. Credit shall be
at the rate of one megawatthour for each 3.4 million British thermal
units (Btus) of heat recovered.
(3) The customer receiving incentives shall adequately maintain
and service the combined heat and power units so that during
operation, the system continues to meet or exceed the efficiency and
emissions standards established pursuant to paragraphs (1) and (2).
(4) Notwithstanding paragraph (1), a project that does not meet
the applicable NOx emissions standard is eligible if it meets both of
the following requirements:
(A) The project operates solely on waste gas. The commission shall
require a customer that applies for an incentive pursuant to this
paragraph to provide an affidavit or other form of proof ,
that specifies that the project shall be operated solely on
waste gas. Incentives awarded pursuant to this paragraph shall be
subject to refund and shall be refunded by the recipient to the
extent the project does not operate on waste gas. As used in this
paragraph, "waste gas" means natural gas that is generated as a
byproduct of petroleum production operations and is not eligible for
delivery to the utility pipeline system.
(B) The air quality management district or air pollution control
district, in issuing a permit to operate the project, determines that
operation of the project will produce an onsite net air emissions
benefit, compared to permitted onsite emissions if the project does
not operate. The commission shall require the customer to secure the
permit prior to receiving incentives.
(d) In determining the eligibility for the self-generation
incentive program, minimum system efficiency shall be determined
either by calculating electrical and process heat efficiency as set
forth in Section 216.6, or by calculating overall electrical
efficiency.
(e) In administering the self-generation incentive program, the
commission may adjust the amount of rebates and evaluate other public
policy interests, including, but not limited to, ratepayers,
and energy efficiency, peak load reduction, load
management, and environmental interests.
(f) The commission shall ensure that distributed generation
resources are made available in the program for all ratepayers.
(g) (1) In administering the self-generation incentive program,
the commission shall provide an additional incentive of 20 percent
from existing program funds for the installation of eligible
distributed generation resources from a California supplier.
(2) "California supplier" as used in this subdivision means any
sole proprietorship, partnership, joint venture, corporation, or
other business entity that manufactures eligible distributed
generation resources in California and that meets either of the
following criteria:
(A) The owners or policymaking officers are domiciled in
California and the permanent principal office, or place of business
from which the supplier's trade is directed or managed, is located in
California.
(B) A business or corporation, including those owned by, or under
common control of, a corporation, that meets all of the following
criteria continuously during the five years prior to providing
eligible distributed generation resources to a self-generation
incentive program recipient:
(i) Owns and operates a manufacturing facility located in
California that builds or manufactures eligible distributed
generation resources.
(ii) Is licensed by the state to conduct business within the
state.
(iii) Employs California residents for work within the state.
(3) For purposes of qualifying as a California supplier, a
distribution or sales management office or facility does not qualify
as a manufacturing facility.
(h) The costs of the program adopted and implemented pursuant to
this section shall not be recovered from customers participating in
the California Alternate Rates for Energy (CARE) program.
SECTION 1. Section 379.6 of the Public
Utilities Code is amended to read:
379.6. (a) (1) It is the intent of the Legislature that the
self-generation incentive program should increase deployment of
distributed generation and distributed storage systems to facilitate
integration of those resources into the electrical grid and reduce
ratepayer costs.
(2) The commission, in consultation with the Energy Commission,
may authorize the annual collection of not more than eighty-three
million dollars ($83,000,000) in each calendar year through December
31, 2014, which the commission may increase on an annual basis in an
appropriate amount consistent with, but not limited to, the annual
rate of inflation. The commission shall administer the
self-generation incentive program until January 1, 2018. On January
1, 2018, the commission shall provide repayment of all unallocated
funds collected pursuant to this section to reduce ratepayer costs.
(3) The commission shall administer solar technologies separately,
pursuant to the California Solar Initiative adopted by the
commission in Decisions 05-12-044 and 06-01-024, as modified by
Article 1 (commencing with Section 2851) of Chapter 9 of Part 2 of
this code, and Chapter 8.8 (commencing with Section 25780) of
Division 15 of the Public Resources Code.
(b) Eligibility for incentives under the program shall be limited
to distributed energy resources that the commission, in consultation
with the State Air Resources Board, determines will achieve
reductions in emissions of greenhouse gases pursuant to the
California Global Warming Solutions Act of 2006 (Division 25.5
(commencing with Section 38500) of the Health and Safety Code).
(c) (1) An eligible distributed energy project shall meet
applicable State Air Resources Board certification standards and
applicable air pollution control district or air quality management
district permitting standards.
(2) An eligible distributed energy project subject to State Air
Resources Board certification or district permitting shall be
adequately maintained and serviced to ensure that during operation
the resource continues to meet or exceed the certification or
permitting requirement.
(3) Notwithstanding paragraph (1), a project that does not meet
the applicable NOx emissions standard is eligible if it meets both of
the following requirements:
(A) The project operates solely on waste gas. The commission shall
require a customer that applies for an incentive pursuant to this
paragraph to provide an affidavit or other form of proof that
specifies that the project shall be operated solely on waste gas.
Incentives awarded pursuant to this paragraph shall be subject to
refund and shall be refunded by the recipient to the extent the
project does not operate on waste gas. As used in this paragraph,
"waste gas" means natural gas that is generated as a byproduct of
petroleum production operations and is not eligible for delivery to
the utility pipeline system.
(B) The air quality management district or air pollution control
district, in issuing a permit to operate the project, determines that
operation of the project will produce an onsite net air emissions
benefit, compared to permitted onsite emissions if the project does
not operate. The commission shall require the customer to secure the
permit prior to receiving incentives.
(d) In determining the eligibility for the self-generation
incentive program, minimum system efficiency shall be determined
either by calculating electrical and process heat efficiency as set
forth in Section 216.6, or by calculating overall electrical
efficiency.
(e) In administering the self-generation incentive program, the
commission shall periodically evaluate the program to adjust the
amount of rebates and other program design elements to achieve the
following program goals and objectives:
(1) Cost-effective use of ratepayer funds to stimulate deployment
of eligible technologies.
(2) Meeting environmental objectives, including reduction of
emissions of greenhouse gases, with confirmation of emission
reductions, in consultation with the State Air Resources Board.
(3) In-state job growth.
(4) Development of market signals to provide incentives for
private investment in California.
(5) Market transformation of most, if not all, eligible
technologies by driving down prices and increasing performance of
these technologies.
(6) Energy efficiency, peakload reduction, and load management.
(7) Equitable distribution of rebates to all eligible technologies
and program participants, including promoting geographic
distribution of rebates throughout the state.
(8) Assessment of technology penetration into underserved areas of
the state that are environmentally blighted and economically
stressed.
(f) The commission shall ensure that distributed generation
resources are made available in the program for all ratepayers.
(g) (1) In administering the self-generation incentive program,
the commission shall provide an additional incentive of 20 percent
from existing program funds for the installation of eligible
distributed generation resources from a California supplier.
(2) "California supplier" as used in this subdivision means any
sole proprietorship, partnership, joint venture, corporation, or
other business entity that manufactures eligible distributed
generation resources in California and that meets either of the
following criteria:
(A) The owners or policymaking officers are domiciled in
California and the permanent principal office, or place of business
from which the supplier's trade is directed or managed, is located in
California.
(B) A business or corporation, including those owned by, or under
common control of, a corporation, that meets all of the following
criteria continuously during the five years prior to providing
eligible distributed generation resources to a self-generation
incentive program recipient:
(i) Owns and operates a manufacturing facility located in
California that builds or manufactures eligible distributed
generation resources.
(ii) Is licensed by the state to conduct business within the
state.
(iii) Employs California residents for work within the state.
(3) For purposes of qualifying as a California supplier, a
distribution or sales management office or facility does not qualify
as a manufacturing facility.
(h) The costs of the program adopted and implemented pursuant to
this section shall not be recovered from customers participating in
the California Alternate Rates for Energy (CARE) program.
(i) For an incentive payment received on the basis that the
distributed energy project uses a renewable fuel, the commission
shall require confirmation of the physical delivery of the renewable
fuel to the project or to the California pipeline system, in an
amount equivalent to the fuel requirements of the project for the
life of the project.
(j) On a schedule to be determined by the commission, the
commission shall transition the program to performance-based
incentives, so that incentive payments are earned based on the actual
electrical output of the distributed energy resource, consistent
with the requirements imposed on the California Solar Initiative as
described in Section 2851.
SEC. 2. No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.