BILL ANALYSIS Ó Senate Appropriations Committee Fiscal Summary Senator Kevin de León, Chair AB 719 (R. Hernandez) - Energy: energy efficiency: street light pole. Amended: August 12, 2013 Policy Vote: EU&C 6-2 Urgency: No Mandate: Yes (see staff comments) Hearing Date: August 12, 2013 Consultant: Marie Liu This bill does not meet the criteria for referral to the Suspense File. Bill Summary: AB 719 would require the California Public Utilities Commission (CPUC) to require investor-owned utilities (IOUs) to offer a tariff for local governments to use to fund energy efficiency improvements in street light poles owned by the utility. Fiscal Impact: Onetime costs of approximately $130,000 from the Public Utilities Reimbursement Account (special) to develop the necessary rulemaking. Background: Each local agency pays the energy bill for the street lights in its jurisdiction, although many agencies do not own the street light poles and fixtures. Local agencies that own the poles can convert those to more efficient street lights, thereby reducing their energy use and monthly bills. However utilities have little incentives to make energy efficiency retrofits to street lights they own, although when they do, the entire retrofit costs can be recovered through rates paid by ratepayers. According to the Senate Energy, Utilities, and Communications Committee, very few utility-owned poles have been converted to more efficient lighting. Proposed Law: This bill would require the CPUC to mandate that IOUs offer a tariff to fund energy efficiency improvements in street light poles owned by the IOU in order to reduce energy consumption. Participation in the tariff would be at the discretion of the local governments who are streetlight customers. > (>) Page 1 The tariff must be designed to allow local governments to remit the cost of the improvement over time without shifting costs to nonparticipating ratepayers. The cost of the improvement must be identified separately on the electrical bill. The street light improvement would be made eligible for any rebate or incentives made available through rate-payer funded energy efficiency programs. Staff Comments: The CPUC will need to open a proceeding to direct the utilities to propose a new tariff to pay for energy efficiency improvements on utility-owned street lights at a cost of approximately $130,000. This bill does not result in a state-reimbursable mandate as the mandate only involves the definition of a crime or the penalty for conviction of a crime.