BILL ANALYSIS Ó
AB 217
Page 1
Date of Hearing: April 8, 2013
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Steven Bradford, Chair
AB 217 (Bradford) - As Amended: April 1, 2013
SUBJECT : Electricity: solar electricity: low-income households
SUMMARY : Creates a new program that provides rebates for solar
installations made by qualified low-income households.
Specifically, this bill :
1)Creates a program to make up to 50 megawatts of rebates
available to qualified single-family and multi-family
affordable housing.
2)Funds the program up to $108 million collected from customers
of investor-owned utilities.
3)Requires eligible participants to enroll in the utility Energy
Savings Assistance Program (ESAP).
4)Requires the California Public Utilities Commission (PUC) to
determine program elements to maximize overall benefit to
ratepayers.
5)Sunsets the program December 31, 2021.
EXISTING LAW :
1)Creates the California Solar Initiative (CSI) with a goal to
install solar energy systems with a generation capacity of
3,000 megawatts, to make solar energy systems a viable
mainstream option for both homes and businesses in 10 years,
and to place solar energy systems on 50% of new homes in 13
years.
2)Specifies no less than 10% of the overall CSI funding is to be
directed toward programs assisting low-income households in
obtaining the benefits of solar technology.
3)Establishes a $217 million budget within the CSI program to
fund the low-income solar rebate program.
4)Permits the PUC to adopt decisions that established the
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Single-Family Affordable Solar Homes Program (SASH) and the
Multifamily Affordable Solar Housing Program (MASH), which
provide monetary incentives for the installation of solar
energy systems on low-income residential housing.
5)States the SASH and MASHP programs will operate until December
31, 2015, or until budgeted funds are exhausted, whichever
occurs sooner.
FISCAL EFFECT : Unknown.
COMMENTS : According to the author, "California has very
aggressive renewable energy goals and is making significant
investments in the clean energy economy. California has been a
leader in providing equitable access to solar energy for all of
our communities. The SASH and MASH programs are proven,
successful low-income solar models that bring the many benefits
of solar energy to our most disadvantaged communities, including
household energy savings, job training and employment
opportunities, local economic development, and environmental
improvement. AB 217 will ensure low-income communities will
have equal access to the technologies and the jobs from these
investments.
1)Background : Pursuant to SB 1 (Murray, Chapter 132, Statutes of
2006), a statewide goal to
install solar energy systems, with a generation capacity of
3,000 megawatts, to make solar energy systems a viable
mainstream option for both homes and businesses in 10 years.
This is known as the Go Solar California Campaign and there is a
statewide budget of $3.5 billion. The statewide effort also
includes the CSI Program which is administered by the PUC. The
purpose of CSI is to offer a $2.2 billion ratepayer funded solar
rebate program with a goal to install 1,940 megawatts of new
solar electric systems on existing homes in investor-owned
utility (IOU) service territory by 2015.
AB 2723 (Pavley, Chapter 864, Statutes of 2006) required the PUC
to ensure that not less than 10% of the CSI funds are used for
the installation of solar energy systems on low-income
residential housing and authorized the PUC to incorporate a
revolving loan or loan guarantee program for this purpose.
The SASH Program provides higher incentives for low-income
single family homeowners. SASH is currently implemented by GRID
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Alternatives (GRID), a non-profit solar contractor.
The MASH program provides higher incentives for low-income
multifamily low-income residences and is implemented by the
respective IOUs - Pacific Gas & Electric (PG&E), Southern
California Edison (SCE), and California Center for Sustainable
Energy in San Diego Gas & Electric territory (SDG&E).
SASH and MASH programs began in 2009 and each has a total budget
of $108 million.
Both programs were specifically designed to provide appropriate
incentives that allowed low-income homeowners and multi-family
tenants to benefit from California's growing solar economy.
The New Solar Homes Partnership (NSHP), a $400 million program
administered by the California Energy Commission (CEC), has a
goal to install 360 megawatts of solar electric systems on new
construction homes in IOU service territory by 2012.
The Go Solar California Campaign includes a goal of 700
megawatts of solar electric systems to be installed in public
owned utility (POU) territory with a budget of $784 million.
Each POU is responsible for designing and administering its own
solar rebate program.
2)Continuing investments in low-income solar programs : AB 217
establishes a low-income
solar program to continue providing the widespread benefits of
the existing programs to families and communities who otherwise
would not have access to solar. The proposed program will be
funded at $108 million - which is 50% less than the existing
program budget- over 7 years. One of the goals of CSI was to
create a sustainable solar market, and this has been occurring
for general market customers through lower solar prices and the
rise of innovative financing models (lease and PPs), which have
allowed more middle-income folks to invest in solar. Though
solar pricing has decreased since CSI began, the upfront cost of
solar will remain a barrier for low-income families and will
require additional price support to maintain their access to
solar.
According to the PUC, the SASH and MASH programs have installed
approximately 25 megawatts to low-income residences. As of
February 2013, 2,500 single-family homes and over 280
multifamily residences have received solar energy systems
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through SASH and MASH programs, respectively. The SASH and MASH
programs sunset in 2015. In some territories, the programs
anticipate their incentive budgets will be fully reserved well
before the programs' sunset date in 2015. In some areas, the
programs may end as early as late 2013.
3)Cost-effectiveness test : Many discussions have occurred
regarding the overall cost-
effectiveness of the CSI Low Income Solar Program. As part of
the current program evaluation cycle, Navigant Consulting issued
a cost-benefit evaluation report in August 2011 for the SASH and
MASH programs during the 2009 and 2010 program years. The
evaluation report determined the SASH program is cost-effective
from the participant perspective, but not from the ratepayer
perspective. Although a low-income program may not be
considered cost-effective from a ratepayer perspective, the
program provides additional benefits by making solar accessible
to low-income communities. Offering higher incentives are
necessary in order to make solar affordable to low-income
households, as well as to incentivize affordable housing
building owners to install solar to benefit low-income renters.
SASH incentives cover a majority, if not all, of the installed
cost of the solar energy system. According to the PUC, the bill
imposes a cost-effective requirement which may require the PUC
to lower the incentives to levels significantly lower than those
currently used in the SASH and MASH programs. This may result in
unintended consequences as the incentives may be too low to make
the economics of installing solar work for these households.
However, the overall intent of the bill is to ensure the PUC
designs a program that reaches low-income communities with a
high energy demand load so that it is, in fact, cost effective
to all ratepayers.
4)Transfer of unspent general market CSI funds : In the case
where there may be unspent
funds that remain in the CSI general market program, the author
and this committee may wish to
consider an amendment that will do the following:
Notwithstanding any other provision, each electric corporation
in subsection (a) can request CPUC approval to use unspent funds
that remain at the close of the California Solar Initiative on
December 31, 2016, and collected pursuant to Section 2851(e)(1)
that were designated by the CPUC for incentives for the General
Market California Solar Initiative to reduce the portion of the
$108,000,000 provided for in subsection (a) that would otherwise
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be collected from its customers .
5)Technical amendments :
Add definition of "low-income households" or "participants" as
having the same meaning as defined in Section 50079.5 of the
Health and Safety Code.
Add language that was inadvertently removed which states "The
Legislature finds and declares that it is the goal of the state
to establish a program to install solar energy systems that have
a generating capacity equivalent of 50 megawatts on low-income
residential housing.
Page 9, line 36, strike January 1, 2022 and add December 31,
2021.
Page 10, strike lines 9-13. This language already appears on
Page 4, lines 18 - 24.
REGISTERED SUPPORT / OPPOSITION :
Support
California Communities United Institute (CalComUI)
California Public Utilities Commission (CPUC) (if amended)
Capitol City Solar
Center for Employment Training
Century Housing
City and County of San Francisco, Department of the Environment
(SF Environment)
City of Belvedere
City of Cathedral City
City of Larkspur
City of Mill Valley
City of Novato
City of Pleasanton
City of Richmond
City of San Rafael
City of Sausalito
City of Upland
Community Housing Development Corporation (CHDC)
Community Housing Improvement Program (CHIP)
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Community Housing Improvement Systems and Planning Association,
Inc. (CHISPA)
Construction Management (CM) Program at California State
University, Fresno
County of Marin
Desert Power, Inc.
Desert Rose Residents Association, Inc.
Desert Solar, Inc.
Division of Ratepayer Advocates (DRA)
Energized Electric
Environment California
Global Green USA
GRID Alternatives
Habitat for Humanity Fresno County
Habitat for Humanity Riverside, Inc.
Heartland Coalition
Indian Valley Habitat for Humanity
Individual Support Letters - 233
La Jolla Band of Luiseno Indians
Lifestyle Solar, Inc.
Los Angeles Trade-Technical College
Marin City Community Development Corporation (MCCDC)
Marin Energy Authority
Mendocino Solar Service
Metro United Methodist Urban Ministry (Metro)
Mitsubishi Electric US, Inc.
Nevada County Habitat for Humanity
North Redlands Visioning Committee
Northern Circle Indian Housing Authority
Pinoleville Pomo Nation
Pomona Valley Habitat for Humanity
Proteus, Inc.
Rebuilding Together Oakland
Redwood Valley Little River Band of Pomo Indians
San Pasqual Band of Diegueno Mission Indians of California
Self-Help Enterprises (SHE)
Shasta-Tehama-Trinity Joint Community College District
Sierra Club California
Solar Energy Exchange, Inc.
Solar Energy Industries Association
Solar Living Institute (SLI)
Solar Richmond
Solar Sonoma County (SSC)
Strategic Energy Innovations
SunEdison
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SunPower Corporation
Sutech School of Vocational and Technical Training
The Greenlining Institute
The Utility Reform Network (TURN)
Town of Corte Madera
Town of Fairfax
Town of Ross
Town of San Anselmo
Town of Tiburon
U.S. Green Building Council-Inland Empire Chapter
Urban Corps of San Diego County
Venice Community Housing Corporation
YouthPower Community Solutions
Opposition
None on file.
Analysis Prepared by : DaVina Flemings / U. & C. / (916)
319-2083