BILL ANALYSIS                                                                                                                                                                                                    ”



                                                                  AB 719
                                                                  Page  1

          CONCURRENCE IN SENATE AMENDMENTS
          AB 719 (Roger HernŠndez)
          As Amended  August 22, 2013
          Majority vote
           
           ----------------------------------------------------------------- 
          |ASSEMBLY:  |53-18|(May 16, 2013)  |SENATE: |26-12|(September 6,  |
          |           |     |                |        |     |2013)          |
           ----------------------------------------------------------------- 
            
           Original Committee Reference:    U. & C.  

           SUMMARY  :  Requires an electrical corporation to file a tariff  
          with the California Public Utilities Commission (PUC) that a  
          local government may use to fund installation of high-efficiency  
          lighting in street light poles that the electrical corporation  
          owns.  Specifically,  this bill  :  

          a)Requires the PUC, on or before March 1, 2014, to order  
            investor-owned utilities (IOUs) to submit a tariff that a  
            local government may use to fund energy efficiency  
            improvements in street light poles owned by the utility in  
            order to reduce energy bills, but with no cost shifts to  
            nonparticipating ratepayers.

          b)Provides that a local government financing an improvement  
            through such a tariff shall be eligible to use any energy  
            efficiency rebate or incentive available for that improvement.

           The Senate amendments  are technical in nature. The bill is  
          substantially similar to the version passed by the Assembly.

           FISCAL EFFECT  :  According to the Senate Appropriations  
          Committee, onetime costs of approximately $130,000 from the  
          Public Utilities Reimbursement Account (special) to develop the  
          necessary rulemaking.

           COMMENTS  :   

           1)Author's Statement  .  According to the author, "Our street  
            lights are neglected public facilities that are operating on  
            outdated energy technology with cities footing the higher  
            energy costs associated with this old technology.  Corporate  
            utilities that stand by without making energy efficiency  
            retrofits, profit from the status quo when more energy is  








                                                                  AB 719
                                                                  Page  2

            consumed by their customers, at the expense of the tax payers  
            and the environment. Something has to be done to provide  
            relief to our cities and counties, particularly when they are  
            making strides and efforts of their own in addressing the  
            matter."

           2)Who Owns the Street Lights  ?  Street light poles can be owned  
            by local governments, Investor Owned Utilities (IOUs),  
            homeowner associations, or private parties.  According to data  
            provided by PUC, local government and IOUs own the following  
            number of street light poles:

                     ------------------------------------------ 
                    |Utility         | IOU owned |    Local    |
                    |                |           | Government  |
                    |                |           |    Owned    |
                    |----------------+-----------+-------------|
                    |PG&E            |  175,585  |   554,000   |
                    |----------------+-----------+-------------|
                    |SCE             |  653,209  |   115,460   |
                    |----------------+-----------+-------------|
                    |SDG&E           |  27,981   |119,469      |
                    |                |           |             |
                     ------------------------------------------ 
           3)Who's Motivated to Convert Street Lights  ?  Generally it is the  
            entity paying the energy bill that has a motivation to reduce  
            energy consumption.  In this situation, the pole is owned by  
            the utility and the local government pays the energy bill.  As  
            a result, local governments are motivated to find ways to  
            reduce energy usage and save money. 

            Currently, local governments are eligible for ratepayer-funded  
            rebates to help reduce street light conversion costs.  PUC has  
            not allowed utilities to be eligible for ratepayer-funded  
            rebates for this purpose.

            PG&E is proposing to replace up to 160,000 non-decorative  
            utility-owned streetlights in its 2014 General Rate Case.   
            PG&E is proposing that the costs for the program through an  
            adjustment in the facility charge for customers who elect to  
            participate in and benefit from the program.  PG&E estimates  
            replacing High Pressure Sodium Vapor (HPSV) with Light  
            Emitting Diodes (LEDs) will save 52.8 million kilowatt-hours  
            annually, reduce customer energy bills (which includes the  
            cost of the facility charge), and improve reliability through  








                                                                  AB 719
                                                                  Page  3

            fewer streetlight burnouts.

           4)New Technologies May or May Not Meet the Service Requirements  
            for Street Lights  .  HPSV lights are the predominant type of  
            street light technology.  Energy efficiency opportunities for  
            improving street lights can be accomplished via induction  
            lights or LED lights.  Depending on models and usage,  
            induction lights can reduce energy consumption by 10% to 50%  
            and last up to four times longer than HPSV lights.  LED lights  
            can reduce energy consumption by up to 50% and last twice as  
            long as HSPV lights.

            LED lighting systems do not have established standards  
            therefore there may be financial risks with purchasing  
            currently-available technology that does not deliver the type  
            and level of lighting necessary to provide similar level of  
            lighting services that were provided by the HSPV technology.   
            According to a 2011 report by the Rensselaer Polytechnic  
            Institute's Lighting Research Center which tested various  
            streetlight technologies against design criteria specified by  
            the American National Standards Institute (ANSI), the tested  
            LED streetlights required from 3% to 92% more poles per mile  
            than the base case to meet the ANSI standard. Pole  
            configuration (staggered vs. single sided).  The study found  
            that with the additional poles necessary to achieve equivalent  
            lighting the net energy consumption would increase an average  
            of 51% to 41% more per mile.  Rensselaer estimated that an  
            incentive range of $250 to $1,550 per streetlight in addition  
            to a volume discount for an LED with a life of 25,000 hours or  
            longer or an induction streetlight would be needed to achieve  
            a lower life-cycle cost per mile than the study's base case.   
            As lighting technologies improve, it is likely these issues  
            will be addressed.


           Analysis Prepared by  :    Susan Kateley / U. & C. / (916)  
          319-2083 


                                                               FN: 0002316