BILL ANALYSIS �
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THIRD READING
Bill No: AB 792
Author: Mullin (D), et al.
Amended: 7/9/13 in Senate
Vote: 21
SENATE GOVERNANCE & FINANCE COMMITTEE : 7-0, 7/3/13
AYES: Wolk, Knight, Beall, DeSaulnier, Emmerson, Hernandez, Liu
ASSEMBLY FLOOR : Not relevant
SUBJECT : Utility user tax: exemption: distributed
generation systems
SOURCE : Author
DIGEST : This bill exempts, from a utility users tax (UUT),
the consumption of electricity generated through a renewable
distributed generation system installed before January 1, 2020,
for use by a single consumer.
ANALYSIS : The California Constitution allows a city, with the
consent of the local voters, to govern its "municipal affairs"
by adopting a charter. The constitutional municipal affairs
doctrine allows charter cities to levy taxes which are not
preempted by the state or federal governments. 66 charter
cities levy a UUT.
A general law city can impose only those taxes that are allowed
by state statutes. However, the Government Code allows all
general law cities to levy any tax which may be levied by any
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AB 792
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charter city unless a different general law limits or prohibits
such a tax. 87 general law cities levy a UUT.
This bill exempts, from any UUT imposed by a local jurisdiction,
a customer's consumption of electricity generated by a renewable
distributed generation system that is installed before January
1, 2020, for the exclusive use of a single customer.
This bill defines "local jurisdiction" as any city, county, city
and county, including any charter city, county, or city and
county, district, or public or municipal corporation.
Comments
Access to solar electricity is critical to California's
achieving its clean energy and greenhouse gas emission goals,
while also enabling more homeowners to reduce their electricity
bills. Solar distributed generation is one of the
fastest-growing markets in California. Industry participants
estimate that more than 150,000 customers in California
self-supply some or all of their electricity using solar
distributed generation, and that more than 43,000 Californians
are employed by firms that are involved in the market for solar
distributed generation. Uncertainty about the potential
application of UUTs to electricity from distributed generation
systems poses a threat to continued growth of this dynamic
distributed solar generation market. Applying a UUT to
third-party power purchase agreement financing would greatly
disadvantage this business model. An internal analysis
conducted by SunEdison found that applying a 7.5% UUT to would
make 15% of solar projects financially unviable for SunEdison's
customers. By eliminating uncertainty about the application of
local UUT ordinances to renewable distributed generation and
ensuring consistent treatment for all customers, this bill will
enable the renewable distributed generation industry to continue
to grow throughout California.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No Local:
No
SUPPORT : (Verified 7/10/13)
California Solar Energy Industries Association
Environment California
AB 792
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Solar Energy Industries Association
Surun
Vote Solar
AB:d 7/10/13 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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