BILL ANALYSIS Ó Senate Appropriations Committee Fiscal Summary Senator Christine Kehoe, Chair SB 454 (Pavley) Hearing Date: 05/26/2011 Amended: 05/04/2011 Consultant: Brendan McCarthy Policy Vote: EU&C 8-2, B&P 5-2 _________________________________________________________________ ____ BILL SUMMARY: SB 454 requires the Energy Commission and the State Contractors License Board to collaborate to enforce compliance with the state's building energy efficiency standards. The bill authorizes the Energy Commission to administratively enforce the state's appliance energy efficiency standards. _________________________________________________________________ ____ Fiscal Impact (in thousands) Major Provisions 2011-12 2012-13 2013-14 Fund Enforcement of appliance $150 $150 $150General * standards * Energy Resources Program Account. _________________________________________________________________ ____ STAFF COMMENTS: SUSPENSE FILE. AS PROPOSED TO BE AMENDED. Under current law, the California Energy Commission is required to develop and adopt energy efficiency standards for new construction and remodeling of residential and commercial buildings. The Contractors State License Board is required to license and regulate building contractors, including compliance with the state's building standards. Also under current law, the California Energy Commission is authorized to develop and adopt energy efficiency standards for certain types of appliances. If the Energy Commission finds a violation of those standards, the Attorney General is authorized to petition a court to enjoin the violation. SB 454 requires the Energy Commission and the Contractors State License Board to collaborate to identify and investigate the SB 454 (Pavley) Page 1 failure of contractors to comply with building energy efficiency standards and to obtain required building permits. The bill authorizes the Energy Commission to adopt regulations to allow the Energy Commission to impose administrative penalties for violations of the state's appliance energy efficiency standards. The bill caps administrative penalties at $2,500 per violation. (The Energy Commission would also be authorized to refer violations to the Attorney General for civil action in court.) Any penalty revenues would be deposited in a new account within the Energy Resources Program Account. The bill also requires that any incentive or rebate provided by a publicly owned utility for energy efficient appliances or upgrades may only be provided if the recipient certifies that a licensed contractor was used to install them and that applicable permitting requirements were followed. Staff estimates that the Energy Commission will need one additional position to coordinate enforcement activities with the Contractors State License Board and one additional position to develop regulations and implement an administrative enforcement program. The Contractors State License Board indicates that any costs under the bill would be absorbable. Staff notes that the tax that supports Energy Resources Program is near its statutory maximum and that the fund has a structural deficit which will necessitate future program cuts or an increase in the tax's statutory maximum. The proposed Committee amendments eliminate the requirement that the California Energy Commission coordinate activities relating to building standard enforcement.