Amended in Assembly April 16, 2013

Amended in Assembly April 1, 2013

California Legislature—2013–14 Regular Session

Assembly BillNo. 217


Introduced by Assembly Member Bradford

(Principal coauthor: Senator De León)

January 31, 2013


An act to amend Sections 2851 and 2852 of the Public Utilities Code, relating to energy.

LEGISLATIVE COUNSEL’S DIGEST

AB 217, as amended, Bradford. Electricity: solar electricity: low-income households.

Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations. Decisions of the commission adopted the California Solar Initiative administered by the state’s 3 largest electrical corporations and subject to the commission’s supervision. Existing law requires the commission to ensure that not less than 10% of the funds for the California Solar Initiative are utilized for the installation of solar energy systems, as defined, on low-income residential housing, as defined. Pursuant to this requirement, the commission adopted decisions that established the Single-Family Affordable Solar Homes Program (SASH) and the Multifamily Affordable Solar Housing Program (MASH), pursuant to which the electrical corporations provide monetary incentives for the installation of solar energy systems on low-income residential housing. The SASH and MASH programs will operate until December 31, 2016, or until funds collected for the above purposes are exhausted, whichever occurs sooner.

This bill would, upon the exhaustion of those funds, authorize the surcharge collected by the electrical corporations for the California Solar Initiative to continue to provide funding for the administration of the SASH and MASH programs. The bill would require the commission to ensure the total amount resulting from the continued collection of the charge does not exceed $108,000,000. The bill would extend the operation of the SASH and MASH programs to December 31, 2021, or until the exhaustion of that amount, whichever occurs sooner. The bill would require the SASH and MASH programs to meet specified requirements.begin insert The bill would make legislative findings and declarations that it is the goal of the state to install solar energy systems that have a generating capacity equivalent to 50 megawatts for low-income residential housing.end insert Because a violation of any order, decision, rule, direction, demand, or requirement of the commission is a crime, this bill would impose a state-mandated local program.

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:

P2    1

SECTION 1.  

Section 2851 of the Public Utilities Code is
2amended to read:

3

2851.  

(a) In implementing the California Solar Initiative, the
4commission shall do all of the following:

5(1) (A) The commission shall authorize the award of monetary
6incentives for up to the first megawatt of alternating current
7generated by solar energy systems that meet the eligibility criteria
8established by the Energy Commission pursuant to Chapter 8.8
9(commencing with Section 25780) of Division 15 of the Public
10Resources Code. The commission shall determine the eligibility
11of a solar energy system, as defined in Section 25781 of the Public
12Resources Code, to receive monetary incentives until the time the
13Energy Commission establishes eligibility criteria pursuant to
P3    1Section 25782. Monetary incentives shall not be awarded for solar
2energy systems that do not meet the eligibility criteria. The
3incentive level authorized by the commission shall decline each
4year following implementation of the California Solar Initiative,
5at a rate of no less than an average of 7 percent per year, and,
6except as provided in subparagraph (B), shall be zero as of
7December 31, 2016. The commission shall adopt and publish a
8schedule of declining incentive levels no less than 30 days in
9advance of the first decline in incentive levels. The commission
10may develop incentives based upon the output of electricity from
11the system, provided those incentives are consistent with the
12declining incentive levels of this paragraph and the incentives
13apply to only the first megawatt of electricity generated by the
14system.

15(B) The incentive level for the installation of a solar energy
16system pursuant to Section 2852 shall be zero as of December 31,
172021.

18(2) The commission shall adopt a performance-based incentive
19program so that by January 1, 2008, 100 percent of incentives for
20solar energy systems of 100 kilowatts or greater and at least 50
21percent of incentives for solar energy systems of 30 kilowatts or
22greater are earned based on the actual electrical output of the solar
23energy systems. The commission shall encourage, and may require,
24performance-based incentives for solar energy systems of less than
2530 kilowatts. Performance-based incentives shall decline at a rate
26of no less than an average of 7 percent per year. In developing the
27performance-based incentives, the commission may:

28(A) Apply performance-based incentives only to customer
29classes designated by the commission.

30(B) Design the performance-based incentives so that customers
31may receive a higher level of incentives than under incentives
32based on installed electrical capacity.

33(C) Develop financing options that help offset the installation
34costs of the solar energy system, provided that this financing is
35ultimately repaid in full by the consumer or through the application
36of the performance-based rebates.

37(3) By January 1, 2008, the commission, in consultation with
38the Energy Commission, shall require reasonable and cost-effective
39energy efficiency improvements in existing buildings as a condition
40of providing incentives for eligible solar energy systems, with
P4    1appropriate exemptions or limitations to accommodate the limited
2financial resources of low-income residential housing.

3(4) Notwithstanding subdivision (g) of Section 2827, the
4commission may develop a time-variant tariff that creates the
5maximum incentive for ratepayers to install solar energy systems
6so that the system’s peak electricity production coincides with
7 California’s peak electricity demands and that ensures that
8ratepayers receive due value for their contribution to the purchase
9of solar energy systems and customers with solar energy systems
10continue to have an incentive to use electricity efficiently. In
11developing the time-variant tariff, the commission may exclude
12customers participating in the tariff from the rate cap for residential
13customers for existing baseline quantities or usage by those
14customers of up to 130 percent of existing baseline quantities, as
15 required by Section 739.9. Nothing in this paragraph authorizes
16the commission to require time-variant pricing for ratepayers
17without a solar energy system.

18(b) Notwithstanding subdivision (a), in implementing the
19 California Solar Initiative, the commission may authorize the award
20of monetary incentives for solar thermal and solar water heating
21devices, in a total amount up to one hundred million eight hundred
22thousand dollars ($100,800,000).

23(c) (1) In implementing the California Solar Initiative, the
24commission shall not allocate more than fifty million dollars
25($50,000,000) to research, development, and demonstration that
26explores solar technologies and other distributed generation
27technologies that employ or could employ solar energy for
28generation or storage of electricity or to offset natural gas usage.
29Any program that allocates additional moneys to research,
30development, and demonstration shall be developed in
31collaboration with the Energy Commission to ensure there is no
32duplication of efforts, and adopted by the commission through a
33rulemaking or other appropriate public proceeding. Any grant
34awarded by the commission for research, development, and
35demonstration shall be approved by the full commission at a public
36meeting. This subdivision does not prohibit the commission from
37continuing to allocate moneys to research, development, and
38demonstration pursuant to the self-generation incentive program
39for distributed generation resources originally established pursuant
P5    1to Chapter 329 of the Statutes of 2000, as modified pursuant to
2Section 379.6.

3(2) The Legislature finds and declares that a program that
4provides a stable source of monetary incentives for eligible solar
5energy systems will encourage private investment sufficient to
6make solar technologies cost effective.

7(3) On or before June 30, 2009, and by June 30th of every year
8thereafter, the commission shall submit to the Legislature an
9assessment of the success of the California Solar Initiative program.
10That assessment shall include the number of residential and
11commercial sites that have installed solar thermal devices for which
12an award was made pursuant to subdivision (b) and the dollar value
13of the award, the number of residential and commercial sites that
14have installed solar energy systems, the electrical generating
15capacity of the installed solar energy systems, the cost of the
16program, total electrical system benefits, including the effect on
17electrical service rates, environmental benefits, how the program
18affects the operation and reliability of the electrical grid, how the
19program has affected peak demand for electricity, the progress
20made toward reaching the goals of the program, whether the
21program is on schedule to meet the program goals, and
22recommendations for improving the program to meet its goals. If
23the commission allocates additional moneys to research,
24development, and demonstration that explores solar technologies
25and other distributed generation technologies pursuant to paragraph
26(1), the commission shall include in the assessment submitted to
27the Legislature, a description of the program, a summary of each
28award made or project funded pursuant to the program, including
29the intended purposes to be achieved by the particular award or
30project, and the results of each award or project.

31(d) (1) The commission shall not impose any charge upon the
32consumption of natural gas, or upon natural gas ratepayers, to fund
33the California Solar Initiative.

34(2) Notwithstanding any other provision of law, any charge
35imposed to fund the program adopted and implemented pursuant
36to this section shall be imposed upon all customers not participating
37in the California Alternate Rates for Energy (CARE) or family
38electric rate assistance (FERA) programs, including those
39residential customers subject to the rate limitation specified in
P6    1Section 739.9 for existing baseline quantities or usage up to 130
2percent of existing baseline quantities of electricity.

3(3) The costs of the program adopted and implemented pursuant
4to this section may not be recovered from customers participating
5in the California Alternate Rates for Energy or CARE program
6established pursuant to Section 739.1, except to the extent that
7program costs are recovered out of the nonbypassable system
8benefits charge authorized pursuant to Section 399.8.

9(e) In implementing the California Solar Initiative, the
10commission shall, except as provided in subdivision (f), ensure
11that the total cost over the duration of the program does not exceed
12three billion five hundred fifty million eight hundred thousand
13dollars ($3,550,800,000). The financial components of the
14California Solar Initiative shall consist of the following:

15(1) Programs under the supervision of the commission funded
16by charges collected from customers of San Diego Gas and Electric
17Company, Southern California Edison Company, and Pacific Gas
18and Electric Company. Except as provided in subdivision (f), the
19total cost over the duration of these programs shall not exceed two
20billion three hundred sixty-six million eight hundred thousand
21 dollars ($2,366,800,000) and includes moneys collected directly
22into a tracking account for support of the California Solar Initiative.

23(2) Programs adopted, implemented, and financed in the amount
24of seven hundred eighty-four million dollars ($784,000,000), by
25charges collected by local publicly owned electric utilities pursuant
26to Section 387.5. Nothing in this subdivision shall give the
27commission power and jurisdiction with respect to a local publicly
28owned electric utility or its customers.

29(3) Programs for the installation of solar energy systems on new
30construction, administered by the State Energy Resources
31Conservation and Development Commission, and funded by
32charges in the amount of four hundred million dollars
33($400,000,000), collected from customers of San Diego Gas and
34Electric Company, Southern California Edison Company, and
35Pacific Gas and Electric Company.

36(4) The changes made to this subdivision by the act adding this
37paragraph do not authorize the levy of a charge or any increase in
38the amount collected pursuant to any existing charge, nor do the
39changes add to, or detract from, the commission’s existing authority
40to levy or increase charges.

P7    1(f) Notwithstanding subdivision (e), upon exhaustion of the
2amount specified in paragraph (1) of subdivision (e), the
3commission shall authorize the continued collection of the charge
4for the purposes of Section 2852. The commission shall ensure
5that the total amount collected pursuant to this subdivision does
6not exceed one hundred eight million dollars ($108,000,000).begin insert Upon
7approval by the commission, an electrical corporation may use
8amounts collected pursuant to subdivision (e) for purposes of
9funding the general market portion of the California Solar
10Initiative, that remain unspent and unencumbered after December
1131, 2016, to reduce that electrical corporation’s portion of the
12total amount collected pursuant to this subdivision.end insert

13

SEC. 2.  

Section 2852 of the Public Utilities Code is amended
14to read:

15

2852.  

(a) begin insertThe Legislature finds and declares that it is the goal
16of the state to install solar energy systems that have a generating
17capacity equivalent to 50 megawatts for low-income residential
18housing.end insert

19begin insert(b)end insertbegin insertend insertAs used in this section, the following terms have the
20following meanings:

21(1) “Affordable housing cost,” “affordable rent,” and “lower
22income households” have the same meanings as in those set forth
23in Chapter 2 (commencing with Section 50050) of Part 1 of
24Division 31 of the Health and Safety Code.

25(2) “California Solar Initiative” means the program providing
26ratepayer funded incentives for eligible solar energy systems
27adopted by the Public Utilities Commission in Decision 05-12-044
28and Decision 06-01-024.

29(3) “Low-income residential housing” means any of the
30following:

31(A) A multifamily residential complex financed with
32low-income housing tax credits, tax-exempt mortgage revenue
33bonds, general obligation bonds, or local, state, or federal loans
34or grants, and for which either of the following applies:

35(i) The rents of the occupants who are lower income households
36do not exceed those prescribed by deed restrictions or regulatory
37agreements pursuant to the terms of the financing or financial
38assistance.

39(ii) The affordable units have been or will be initially sold at an
40affordable housing cost to a lower income household and those
P8    1units are subject to a resale restriction or equity sharing agreement
2pursuant to the terms of the financing or financial assistance.

3(B) A multifamily residential complex in which at least 20
4percent of the total housing units are sold or rented to lower income
5households and either of the following applies:

6(i) The rental housing units targeted for lower income
7households are subject to a deed restriction or affordability
8covenant with a public entity or nonprofit housing provider
9organized under Section 501(c)(3) of the Internal Revenue Code
10that has as its stated purpose in its articles of incorporation on file
11with the office of the Secretary of State to provide affordable
12housing to lower income households that ensures that the units
13will be available at an affordable rent for a period of at least 30
14years.

15(ii) The housing units have been or will be initially sold at an
16affordable cost to a lower income household and those units are
17subject to a resale restriction or equity sharing agreement, for
18which the homeowner does not receive a greater share of equity
19than described in paragraph (2) of subdivision (c) of Section 65915
20of the Government Code, with a public entity or nonprofit housing
21provider organized under Section 501(c)(3) of the Internal Revenue
22Code that has as its stated purpose in its articles of incorporation
23on file with the office of the Secretary of State to provide affordable
24housing to lower income households.

25(C) An individual residence sold at an affordable housing cost
26to a lower income household that is subject to a resale restriction
27or equity sharing agreement, for which the homeowner does not
28receive a greater share of equity than described in paragraph (2)
29of subdivision (c) of Section 65915 of the Government Code, with
30a public entity or nonprofit housing provider organized under
31Section 501(c)(3) of the Internal Revenue Code that has as its
32stated purpose in its articles of incorporation on file with the office
33of the Secretary of State to provide affordable housing to lower
34income households.

35(4) “Solar energy system” means a solar energy device that has
36the primary purpose of providing for the collection and distribution
37of solar energy for the generation of electricity, that produces at
38least one kilowatt, and produces not more than five megawatts,
39alternating current rated peak electricity, and that meets or exceeds
P9    1the eligibility criteria established by the commission or the Energy
2Commission.

begin delete

3(b)

end delete

4begin insert(c)end insert In establishing the California Solar Initiative, no moneys
5shall be diverted from any existing programs for low-income
6ratepayers, or from cost-effective energy efficiency or demand
7response programs.

begin delete

8(c)

end delete

9begin insert(d)end insert (1) The commission shall ensure that not less than 10 percent
10of the funds for the California Solar Initiative, as specified in
11subdivision (e) of, or moneys collected pursuant to subdivision (f)
12of, Section 2851, are utilized for the installation of solar energy
13systems on low-income residential housing. Notwithstanding any
14other law, the commission may modify the monetary incentives
15made available pursuant to the California Solar Initiative to
16accommodate the limited financial resources of low-income
17residential housing.

18(2) The commission may incorporate a revolving loan or loan
19guarantee program into the California Solar Initiative for
20low-income residential housing. All loans outstanding as of January
211,begin delete 2021end deletebegin insert 2022end insert, shall continue to be repaid consistent with the terms
22and conditions of the program adopted and implemented by the
23commission pursuant to this subdivision, until repaid in full.

24(3) All moneys set aside for the purpose of funding the
25installation of solar energy systems on low-income residential
26housing that are unexpended and unencumbered on January 1,
27begin delete 2021end deletebegin insert 2022end insert, and all moneys thereafter repaid pursuant to paragraph
28(2), except to the extent those moneys are encumbered pursuant
29to this section, shall be utilized to augment existing cost-effective
30energy efficiency measures in low-income residential housing that
31benefit ratepayers.

begin delete

32(d)

end delete

33begin insert(e)end insert In supervising a program implementing the California Solar
34Initiative pursuant to this section, the commission shall ensure that
35the program does all of the following:

36(1) Is a cost-effective investment by ratepayers in peak
37electricity generation capacity where ratepayers recoup the cost
38of their investment through lower rates as a result of avoiding
39purchases of electricity at peak rates, with additional system
40reliability and pollution reduction benefits.

begin delete

P10   1(2) Requires reasonable and cost-effective energy efficiency
2improvements in existing buildings as a condition of providing
3incentives for eligible solar energy systems, with appropriate
4exemptions or limitations to accommodate the limited financial
5 resources of low-income residential housing.

6(3)

end delete

7begin insert(2)end insert Requires participants who receive monetary incentives to
8enroll in the Energy Savings Assistance Program established
9pursuant to Section 382, if eligible.

begin delete

10(4)

end delete

11begin insert(3)end insert Provides job training and employment opportunities in the
12solar energy and energy efficiency sectors of the economy.

13

SEC. 3.  

No reimbursement is required by this act pursuant to
14Section 6 of Article XIII B of the California Constitution because
15the only costs that may be incurred by a local agency or school
16district will be incurred because this act creates a new crime or
17infraction, eliminates a crime or infraction, or changes the penalty
18for a crime or infraction, within the meaning of Section 17556 of
19the Government Code, or changes the definition of a crime within
20the meaning of Section 6 of Article XIII B of the California
21Constitution.



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