BILL ANALYSIS Ó ------------------------------------------------------------ |SENATE RULES COMMITTEE | SB 771| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 651-1520 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ THIRD READING Bill No: SB 771 Author: Kehoe (D), et al. Amended: 4/13/11 Vote: 21 SENATE ENERGY, UTIL. & COMM. COMMITTEE : 10-0, 5/3/11 AYES: Padilla, Fuller, Corbett, De León, DeSaulnier, Pavley, Rubio, Simitian, Strickland, Wright NO VOTE RECORDED: Berryhill SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8 SUBJECT : California Alternative Energy and Advanced Transportation Financing Authority SOURCE : Clean Power Campaign DIGEST : This bill expands the definition of renewable energy under the California Alternative Energy and Advanced Transportation Financing Authority (CAEATFA) to include landfill gas turbines, digester gas turbines, and microturbines. ANALYSIS : Existing law 1. Requires the CAEATFA to provide bond financing for the CONTINUED SB 771 Page 2 development and commercialization of competitive advanced transportation technologies and facilities utilizing alternative methods and sources of energy. It is also authorized to approve sales and use tax exemption on tangible personal property utilized for the design, manufacture, production, or assembly of advanced transportation technologies or alternative energy source products, components or systems. The sales and use tax exemption sunsets January 1, 2021. 2. Defines, only for purpose of the CAEATFA, renewable energy to include fuel sources such as wind, solar and geothermal but also includes natural gas turbines and fuel cells. Comments California Alternative Energy and Advanced Transportation Financing Authority CAEATFA was created in 1980 with an authorization of $200 million in revenue bonds to finance projects utilizing alternative sources of energy, such as cogeneration, wind and geothermal power. It was renamed in 1994 as currently titled and its charge expanded to include the financing of "advanced transportation" technologies. During the energy crisis of 2001, its authority was again expanded, this time to provide financial assistance to public power entities, independent generators, and others for new and renewable energy sources, and to develop clean distributed generation. CAEATFA's authority is broad but in practice it has not been utilized until recently. The State Treasurer has tried to reinvigorate the authority and has launched a sales and use tax exemption program to stimulate green manufacturing as authorized by SB 71 (Padilla, 2010). SB 771 Page 3 Comments According to the author's office, a problem exists with renewable programs and opines that as new technologies evolve the renewable programs are not keeping pace leaving some technologies that serve renewable goals ineligible for specified programs particularly those that the author categorizes as "clean continuous renewable energy technologies." FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes Local: No SUPPORT : (5/13/11) Clean Power Campaign (Source) Flex Energy, Inc. ARGUMENTS IN SUPPORT : The Clean Power Campaign states that Senate Bill 771creates a new a new category of "continuous clean renewable energy" to recognize the benefits of technologies that provide baseload electricity and maintain an emissions profile equivalent or better than Air Resources Board 2013 standard. By creating this new category and allowing for its inclusion in selected clean technology programs managed by the state, SB 771 will serve to achieve the state's effort to improve air quality, accelerate the utilization of clean technologies and promote economic growth by way of investment in the clean technology sector. RM:rm 5/18/11 Senate Floor Analyses SUPPORT/OPPOSITION: SEE ABOVE **** END ****