BILL ANALYSIS Ó
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
AB 2339 (Williams) - Energy: geothermal technologies.
Amended: August 6, 2012 Policy Vote: E,U&C 11-0 EQ 7-0
Urgency: No Mandate: No
Hearing Date: August 16, 2012 Consultant:
Bob Franzoia
SUSPENSE FILE.
Bill Summary: AB 2339 would require the California Energy
Commission, in consultation with the Public Utilities
Commission, the Air Resources Board, and other stakeholders to
evaluate and recommend policies and implementation strategies to
overcome barriers to the deployment and use of geothermal heat
pump and geothermal loop technologies.
Fiscal Impact: Up to $100,000 from the Energy Resources Programs
Account (General Fund) for the commission to evaluate and make
recommendations for inclusion in the 2013 report update.
Background: According to the US Department of Energy, geothermal
heat pumps (sometimes referred to as earth-coupled,
ground-source, or water-source heat pumps) have been in use
since the late 1940s. Geothermal heat pumps use the constant
temperature of the earth as the exchange medium instead of the
outside air temperature. This allows the system to reach fairly
high efficiencies (300 percent to 600 percent) on the coldest of
winter nights, compared to 175 percent to 250 percent for
air-source heat pumps on cool days.
In May 2011, the commission issued a report "Overcoming Barriers
to Ground Source Heat Pumps in California. The study,
investigated, among other things, how to remove barriers to
ground source heat pump drilling in California. Currently,
California houses 12.1 percent of the country's population but
represents only 2.3 percent of national ground source heat pump
activity.
Proposed Law: The commission would be required to include those
evaluations and recommendations in the integrated energy policy
report that is required to be adopted for calendar year 2013.
AB 2339 (Williams)
Page 1
Staff Comments: Pursuant to Public Resources Code 25302,
beginning November 1, 2003, and every two years thereafter, the
commission shall adopt an Integrated Energy Policy Report. This
integrated report shall contain an overview of major energy
trends and issues facing the state, including, but not limited
to, supply, demand, pricing, reliability, efficiency, and
impacts on public health and safety, the economy, resources, and
the environment. It is unclear if research related to
geothermal heat pumps and geothermal ground loop technologies is
a "current and pressing" energy issue that should specifically
identified as an area of analysis in the report.
The next full integrated energy policy report is planned for
release in the last quarter of 2013/first quarter of 2014.
The Energy Resources Programs Account (3360-0465) is funded by a
surcharge on electricity use of up to three-tenths of a mill
($0.0003) surcharge per kilowatt hour. (This account is
considered a "mixed" account as it contains General Funds and a
small amount of special funds in the form of permit fees).
Funds in the account may be used for the program proposed in
this bill.
Due to the economic recession, energy use in the state has
declined, reducing revenues into the account. In the fall of
2010, the commission raised the surcharge to $0.00029. The
estimated account balance for 2012-13 is $15,786,000, down from
$18,986,000 in 2011-12 and $19,371,000 in 2010-11.
Public Interest Energy Research (PIER) Program funds may also be
a potential funding source. However, the Public Goods Charge
has not been reauthorized and PIER has a limited remaining
balance.