BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | SB 454|
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THIRD READING
Bill No: SB 454
Author: Pavley (D)
Amended: 5/31/11
Vote: 21
SENATE ENERGY, UTILITIES & COMM. COMMITTEE : 8-2, 04/05/11
AYES: Padilla, Corbett, De León, DeSaulnier, Pavley,
Rubio, Simitian, Wright
NOES: Fuller, Berryhill
NO VOTE RECORDED: Strickland
SENATE BUS, PROF & ECON DEVELOP. COMMITTEE : 6-3, 05/02/11
AYES: Price, Corbett, Correa, Hernandez, Negrete McLeod,
Vargas
NOES: Emmerson, Walters, Wyland
SENATE APPROPRIATIONS COMMITTEE : 6-2, 05/26/11
AYES: Kehoe, Alquist, Lieu, Pavley, Price, Steinberg
NOES: Walters, Runner
NO VOTE RECORDED: Emmerson
SUBJECT : Energy efficiency standards: enforcement
SOURCE : Natural Resources Defense Council
State Building Construction Trades Council,
AFL-CIO
DIGEST : This bill authorizes the California Energy
Commission (CEC) to establish an administrative enforcement
process to enforce appliance efficiency standard. This
CONTINUED
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bill provides for the assessment of civil penalties by the
commission for a violation of the standards. This bill
requires the penalties collected to be deposited in the
Appliance Efficiency Enforcement Subaccount, which this
bill would establish in the Energy Resources Program
Account, and authorizes the commission to expend the moneys
in the subaccount, up appropriation by the Legislature, as
specified. This bill requires the court, upon granting of
relief for a violation of the standards, to award the
commission the reasonable costs incurred by the commission
in investigating and prosecuting the action, as specified.
ANALYSIS : Existing law:
1.Requires the CEC to adopt energy efficiency regulations
applicable to new construction and remodeling of
residential and commercial buildings.
2.Requires the CEC to adopt regulations that specify energy
efficiency standards required of appliances sold in
California.
3.Establishes within the Contractors State License Board
(CSLB) and requires the CSLB to license and regulate
California's construction contractors, investigate
complaints against licensed and unlicensed contractors,
issue citations, suspend or revoke licenses, and seek
administrative, criminal, and civil sanctions against
violators.
4.Specifies construction work for which a contractor or
building owner is required to obtain a permit from local
building officials and get required inspections to ensure
that the work complies with regulations, including energy
efficiency regulations.
5.Provides that, if the CEC finds any actual or imminent
violation of the provisions of law relating to CEC's
authority or operations, the Attorney General is required
to petition a court to enjoin the violation.
6.Requires the Public Utilities Commission (PUC) to
administer cost-effective energy efficiency programs.
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This bill:
1.Provides that, if the CEC finds that a violation of the
building or appliance regulations has occurred or is
threatening to occur, the CEC may, or the Attorney
General upon the request of the CEC shall, petition a
court to enjoin the violation and authorizes the court to
enjoin the violation or assess a civil penalty.
2.Authorizes the CEC to adopt regulations to establish an
administrative enforcement process to assess civil
penalties for violations of the energy efficiency
building and appliance regulations.
3.Authorizes a court in a civil action and the CEC in an
administrative enforcement action to impose a civil
penalty of up to $2,500 for each violation of energy
efficiency building and appliance regulations and would
require consideration of specified factors when assessing
the amount of the penalty.
4.Requires that penalties resulting from an action brought
by the Attorney General be deposited into the General
Fund and penalties resulting from an action brought by
the CEC be deposited into the Energy Resources Program
Account for the CEC to use for education and enforcement
of energy efficiency building and appliance regulations.
5.Requires a court to award to the CEC the reasonable costs
of investigating and prosecuting a civil action for
violation of energy efficiency building and appliance
regulations.
6.Provides that a person is deemed to be in violation of
the energy efficiency building regulations if the person
does work subject to those regulations and is an
unlicensed contractor or fails to obtain a required
permit.
7.Prohibits a public utility from issuing rebates or
incentives for energy efficiency improvements unless the
recipient of the rebate or incentive certifies that a
licensed contractor was used, as appropriate, and the
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applicable permitting requirements were followed, for the
improvement or installation
Background
Energy Efficiency Programs
Energy efficiency is the top priority in California's
policies to achieve energy savings and reduce greenhouse
gas emissions. The state's Title 24 energy efficiency
building regulations, which are updated every three years,
specify requirements relating to lighting, insulation,
windows, heating, ventilation, and air conditioning
systems, and other construction details designed to reduce
energy consumption and lower energy bills for consumers.
The state's Title 20 energy efficiency appliance
regulations specify energy use standards for most major
household and commercial appliances that must be met in
order to be sold in California. Numerous programs
administered by the CEC, PUC, investor-owned utilities
(IOUs), publicly owned utilities and local government
agencies offer consumers incentives or rebates to purchase
energy efficiency appliances and construct or install
energy efficient devices or technologies in residential and
commercial buildings.
The PUC has approved a $3.1 billion portfolio of energy
efficiency programs administered by the IOUs for 2010-12
funded by a ratepayer surcharge. This investment is
expected to produce cost-effective energy savings of 10,000
GWh of electricity, 1,982 peak MW, and 200 million therms
of natural gas, the equivalent of avoiding nearly four 500
megawatt power plants. The IOUs administer these programs
under the PUC's Risk/Reward Incentive Mechanism and can
earn shareholder bonuses or be penalized for the amount of
verified energy savings achieved. For the first three-year
program cycle, the PUC awarded the IOUs more than $200
million in shareholder bonuses, although the IOUs' claimed
energy savings and the PUC's evaluation, measurement and
verification (EM&V) of those savings faced substantial
challenges.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
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According to Senate Appropriations Committee:
Fiscal Impact (in
thousands)
Major Provisions 2011-12
2012-13 2013-14 Fund
Enforcement of building $75 $150 $150
General*
standards
Enforcement of building $150 $150 $150
General*
standards
*Energy Resources Program Account
Senate Appropriations staff estimates that the Energy
Commission will need on additional position to coordinate
enforcement activities with the Contractors State License
Board and on 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 also 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.
SUPPORT : (Verified 5/26/11)
Natural Resources Defense Council (co-source)
State Building Construction Trades Council, AFL-CIO
(co-source)
Apollo Alliance
California Energy Efficiency Industry Council (if amended)
CA League of Conservation Voters
Environmental Defense Fund
Osram Sylvania
Sierra Club California
ARGUMENTS IN SUPPORT : According to the author's office,
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this bill will increase compliance with the state's energy
efficiency regulations for buildings and appliances with
better enforcement against building contractors who are
unlicensed and do not obtain required building permits and
against manufacturers who sell appliances that are not
certified as meeting the appliance regulations. The author
claims that this will level the playing field in the
building industry, ensure that contractors who violate the
law do not have an unfair advantage over law-abiding
contractors, and help ensure that California realizes the
energy savings that compliance with these regulations are
designed to achieve. The author claims that the CSLB "does
not have energy efficiency expertise" and, therefore, the
CEC, as the agency that adopted the energy efficiency
building and appliance regulations, should have authority
to enforce the regulations and impose civil penalties.
RM:rm 5/31/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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