BILL NUMBER: AB 1014	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  APRIL 24, 2013
	AMENDED IN ASSEMBLY  APRIL 9, 2013
	AMENDED IN ASSEMBLY  MARCH 21, 2013

INTRODUCED BY   Assembly Member Williams
   (Coauthor: Senator Wolk)

                        FEBRUARY 22, 2013

   An act  to amend Section 25019 of the Corporations Code,
and to amend Sections 216 and 218 of,  to add Chapter 7.6
(commencing with Section 2832) to Part 2 of Division 1 of  ,
and to repeal Section 2826.5 of,  the Public Utilities Code,
relating to energy.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 1014, as amended, Williams. Energy: electrical corporations:
 Green Tariff and  Shared Renewable  Energy
Self-Generation   Generation  Program.
   (1) Under existing law, the Public Utilities Commission has
regulatory jurisdiction over public utilities, including electrical
corporations, as defined. Existing law authorizes the commission to
fix the rates and charges for every public utility, and requires that
those rates and charges be just and reasonable. Under existing law,
the local government renewable energy self-generation program
authorizes a local government, as defined, to receive a bill credit,
as defined, to be applied to a designated benefiting account for
electricity exported to the electrical grid by an eligible renewable
generating facility, as defined, and requires the commission to adopt
a rate tariff for the benefiting account.
   This bill would  enact the Shared Renewable Energy
Self-Generation Program. The program would authorize a retail
customer of an electrical corporation, referred to as a participant,
to acquire an interest, as defined, in a shared renewable energy
facility, as defined, for the purpose of receiving a bill credit, as
defined, to offset all or a portion of the participant's electricity
usage, consistent with specified requirements   require
specified electrical corporations to file with the commission, by
March 1, 2014, an advice letter requesting the approval of a Green
Tariff and Shared Renewable Generation Program. The bill would
require the commission, by July 1, 2014, after notice and opportunity
for public comment, to approve the advice letter if the commission
finds that the proposed program is reasonable and consistent with
specified findings  . 
   The bill would provide that any corporation or person engaged
directly or indirectly in developing, owning, producing, delivering,
participating in, or selling interests in, a shared renewable energy
facility is not a public utility or electrical corporation solely by
reason of engaging in any of those activities. 
   (2) Under existing law, a violation of the Public Utilities Act or
any order, decision, rule, direction, demand, or requirement of the
commission is a crime.
   Because the provisions of the bill would require action by the
commission to implement its requirements, a violation of these
provisions would impose a state-mandated local program by expanding
the definition of a crime. 
   (3) Existing law authorizes the City of Davis to receive a bill
credit, as defined, to a benefiting account, as defined, for
electricity supplied to the electrical grid by a photovoltaic
electricity generation facility located within, and partially owned
by, the city, referred to as the PVUSA solar facility, and requires
the commission to adopt a rate tariff for the benefiting account.
 
   This bill would repeal these provisions relating to the City of
Davis, but would require a shared renewable energy facility to either
be the PVUSA facility or a newly constructed renewable facility
constructed pursuant to the Shared Renewable Energy Self-Generation
Program that begins commercial operation on or after January 1, 2014.
 
   (4) 
    (   3)   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:

   SECTION 1.    Chapter 7.6 (commencing with Section
2832) is added to Part 2 of Division 1 of the   Public
Utilities Code   , to read: 
      CHAPTER 7.6.  GREEN TARIFF AND SHARED RENEWABLE GENERATION
PROGRAM


   2832.  The Legislature finds and declares all of the following:
   (a) The creation of renewable energy within California provides
significant financial, health, environmental, and workforce benefits
to the State of California.
   (b) The California Solar Initiative has been extremely successful,
resulting in over 140,000 residential and commercial onsite
installations of solar energy systems. However, it cannot reach all
residents and businesses that want to participate and is limited to
solar. The Green Tariff and Shared Renewable Generation Program seeks
to build on this success by expanding access to renewable energy
resources to all ratepayers who are currently unable to access the
benefits of onsite generation.
   (c) The Governor has proposed the Clean Energy Jobs Plan calling
for the development of 20,000 megawatts of generation from renewable
energy resources by 2020. There is widespread interest from many
large institutional customers, including schools, colleges,
universities, local governments, businesses, and the military, for
development of renewable generation facilities to serve more than 33
percent of their energy needs. For these reasons, the Legislature
agrees that the Governor's Clean Energy Jobs Plan represents a
desired policy direction for the state. It is the intent of the
Legislature that renewable generation that comes online as part of
the Green Tariff and Shared Renewable Generation Program is counted
toward an electrical corporation's efforts to implement the Governor'
s Clean Energy Jobs Plan.
   (d) Properly designed, shared renewable energy programs can
provide access and long-term cost savings to underserved communities,
such as low- to moderate-income residents, and residential and
commercial renters, while not shifting costs to nonbeneficiaries.
   (e) While municipal utilities already have the authority to create
their own shared renewable energy programs, only an act of the
Legislature can empower the vast majority of California residents to
be able to enjoy the significant benefits of shared renewable energy
systems while the state benefits from avoided transmission and
distribution upgrades, avoided line loss, and cleaner air and water.
   (f) Public institutions will benefit from the Green Tariff and
Shared Renewable Generation Program's enhanced flexibility to
participate in shared renewable energy facilities. Electricity usage
is one of the most significant cost pressures facing public
institutions at a time when they have been forced to cut essential
programs, increase classroom sizes, and lay off teachers. Schools may
use the long-term savings for restoring funds for salaries, facility
maintenance, and other budgetary needs.
   (g) Renewable generation creates jobs, reduces emissions of
greenhouse gases, and promotes energy independence.
   (h) Many large energy users in California have pursued onsite
renewable energy generation, but cannot achieve their goals due to
rooftop or land space limitations, or size limits on net metering.
The enactment of this chapter will create a mechanism whereby
institutional customers such as military installations, universities,
and local governments, as well as commercial customers and groups of
individuals, can efficiently invest in generating electricity from
renewable generation.
   (i) It is the intent of the Legislature that the Green Tariff and
Shared Renewable Generation Program be implemented in such a manner
as to create a large, sustainable market for the purchase of an
interest in offsite renewable generation, while fairly compensating
electrical corporations for the services they provide.
   (j) It is the further intent of the Legislature to preserve a
thriving, sustainable agricultural industry, and to ensure that the
development of renewable energy does not remove prime farmland from
productive use without a comprehensive public review process.
   2833.  (a) On or before March 1, 2014, an electrical corporation
with at least 100,000 customers shall file with the commission an
advice letter requesting approval of a Green Tariff and Shared
Renewable Generation Program that it determines is consistent with
the findings specified in Section 2832.
   (b) On or before July 1, 2014, the commission shall issue a
resolution on the electrical corporation's advice letter for a Green
Tariff and Shared Renewable Generation Program, determining whether
to approve or disprove it, with or without modifications.
   (c) After notice and an opportunity for public comment, the
commission shall approve an advice letter by an electrical
corporation for a Green Tariff and Shared Renewable Generation
Program if the commission determines that the program is reasonable
and consistent with the findings specified in Section 2832.
   (d) This section does not apply to applications by electrical
corporations for a Green Tariff and Shared Renewable Generation
Program that are filed at the commission prior to May 1, 2013, and
does not change the existing authority of the commission to approve
those applications in accordance with its existing authority under
the Public Utilities Code. 
   SEC. 2.    No reimbursement is required by this act
pursuant to Section 6 of Article XIII B of the California
Constitution because the only costs that may be incurred by a local
agency or school district will be incurred because this act creates a
new crime or infraction, eliminates a crime or infraction, or
changes the penalty for a crime or infraction, within the meaning of
Section 17556 of the Government Code, or changes the definition of a
crime within the meaning of Section 6 of Article XIII B of the
California Constitution.  
  SECTION 1.    Section 25019 of the Corporations
Code is amended to read:
   25019.  (a) "Security" means any note; stock; treasury stock;
membership in an incorporated or unincorporated association; bond;
debenture; evidence of indebtedness; certificate of interest or
participation in any profit-sharing agreement; collateral trust
certificate; preorganization certificate or subscription;
transferable share; investment contract; viatical settlement contract
or a fractionalized or pooled interest therein; life settlement
contract or a fractionalized or pooled interest therein; voting trust
certificate; certificate of deposit for a security; interest in a
limited liability company and any class or series of those interests
(including any fractional or other interest in that interest), except
a membership interest in a limited liability company in which the
person claiming this exception can prove that all of the members are
actively engaged in the management of the limited liability company;
provided that evidence that members vote or have the right to vote,
or the right to information concerning the business and affairs of
the limited liability company, or the right to participate in
management, shall not establish, without more, that all members are
actively engaged in the management of the limited liability company;
certificate of interest or participation in an oil, gas or mining
title or lease or in payments out of production under that title or
lease; put, call, straddle, option, or privilege on any security,
certificate of deposit, or group or index of securities (including
any interest therein or based on the value thereof); or any put,
call, straddle, option, or privilege entered into on a national
securities exchange relating to foreign currency; any beneficial
interest or other security issued in connection with a funded
employees' pension, profit sharing, stock bonus, or similar benefit
plan; or, in general, any interest or instrument commonly known as a
"security"; or any certificate of interest or participation in,
temporary or interim certificate for, receipt for, guarantee of, or
warrant or right to subscribe to or purchase, any of the foregoing.
All of the foregoing are securities whether or not evidenced by a
written document.
   (b) "Security" does not include: (1) any beneficial interest in
any voluntary inter vivos trust which is not created for the purpose
of carrying on any business or solely for the purpose of voting, or
(2) any beneficial interest in any testamentary trust, or (3) any
insurance or endowment policy or annuity contract under which an
insurance company admitted in this state promises to pay a sum of
money (whether or not based upon the investment performance of a
segregated fund) either in a lump sum or periodically for life or
some other specified period, or (4) any franchise subject to
registration under the Franchise Investment Law (Division 5
(commencing with Section 31000)), or exempted from registration by
Section 31100 or 31101, or (5) any right to a bill credit or interest
of a participant in a community renewable energy facility pursuant
to Chapter 7.6 (commencing with Section 2832) of Part 2 of Division 1
of the Public Utilities Code.  
  SEC. 2.    Section 216 of the Public Utilities
Code is amended to read:
   216.  (a) "Public utility" includes every common carrier, toll
bridge corporation, pipeline corporation, gas corporation, electrical
corporation, telephone corporation, telegraph corporation, water
corporation, sewer system corporation, and heat corporation, where
the service is performed for, or the commodity is delivered to, the
public or any portion thereof.
   (b) Whenever any common carrier, toll bridge corporation, pipeline
corporation, gas corporation, electrical corporation, telephone
corporation, telegraph corporation, water corporation, sewer system
corporation, or heat corporation performs a service for, or delivers
a commodity to, the public or any portion thereof for which any
compensation or payment whatsoever is received, that common carrier,
toll bridge corporation, pipeline corporation, gas corporation,
electrical corporation, telephone corporation, telegraph corporation,
water corporation, sewer system corporation, or heat corporation, is
a public utility subject to the jurisdiction, control, and
regulation of the commission and the provisions of this part.
   (c) When any person or corporation performs any service for, or
delivers any commodity to, any person, private corporation,
municipality, or other political subdivision of the state, that in
turn either directly or indirectly, mediately or immediately,
performs that service for, or delivers that commodity to, the public
or any portion thereof, that person or corporation is a public
utility subject to the jurisdiction, control, and regulation of the
commission and the provisions of this part.
   (d) Ownership or operation of a facility that employs cogeneration
technology or produces power from other than a conventional power
source or the ownership or operation of a facility which employs
landfill gas technology does not make a corporation or person a
public utility within the meaning of this section solely because of
the ownership or operation of that facility.
   (e) Any corporation or person engaged directly or indirectly in
developing, producing, transmitting, distributing, delivering, or
selling any form of heat derived from geothermal or solar resources
or from cogeneration technology to any privately owned or publicly
owned public utility, or to the public or any portion thereof, is not
a public utility within the meaning of this section solely by reason
of engaging in any of those activities.
   (f) The ownership or operation of a facility that sells compressed
natural gas at retail to the public for use only as a motor vehicle
fuel, and the selling of compressed natural gas at retail from that
facility to the public for use only as a motor vehicle fuel, does not
make the corporation or person a public utility within the meaning
of this section solely because of that ownership, operation, or sale.

   (g) Ownership or operation of a facility that is an exempt
wholesale generator, as defined in the Public Utility Holding Company
Act of 2005 (42 U.S.C. Sec. 16451(6)), does not make a corporation
or person a public utility within the meaning of this section, solely
due to the ownership or operation of that facility.
   (h) The ownership, control, operation, or management of an
electric plant used for direct transactions or participation directly
or indirectly in direct transactions, as permitted by subdivision
(b) of Section 365, sales into a market established and operated by
the Independent System Operator or any other wholesale electricity
market, or the use or sale as permitted under subdivisions (b) to
(d), inclusive, of Section 218, shall not make a corporation or
person a public utility within the meaning of this section solely
because of that ownership, participation, or sale.
   (i) The ownership, control, operation, or management of a facility
that supplies electricity to the public only for use to charge light
duty plug-in electric vehicles does not make the corporation or
person a public utility within the meaning of this section solely
because of that ownership, control, operation, or management. For
purposes of this subdivision, "light duty plug-in electric vehicles"
includes light duty battery electric and plug-in hybrid electric
vehicles. This subdivision does not affect the commission's authority
under Section 454 or 740.2 or any other applicable statute.
   (j) A corporation or person engaged directly or indirectly in
developing, owning, producing, delivering, participating in, or
selling interests in a shared renewable energy facility pursuant to
Chapter 7.6 (commencing with Section 2832) of Part 2, is not a public
utility within the meaning of this section solely by reason of
engaging in any of those activities.  
  SEC. 3.    Section 218 of the Public Utilities
Code is amended to read:
   218.  (a) "Electrical corporation" includes every corporation or
person owning, controlling, operating, or managing any electric plant
for compensation within this state, except where electricity is
generated on or distributed by the producer through private property
solely for its own use or the use of its tenants and not for sale or
transmission to others.
   (b) "Electrical corporation" does not include a corporation or
person employing cogeneration technology or producing power from
other than a conventional power source for the generation of
electricity solely for any one or more of the following purposes:
   (1) Its own use or the use of its tenants.
   (2) The use of or sale to not more than two other corporations or
persons solely for use on the real property on which the electricity
is generated or on real property immediately adjacent thereto, unless
there is an intervening public street constituting the boundary
between the real property on which the electricity is generated and
the immediately adjacent property and one or more of the following
applies:
   (A) The real property on which the electricity is generated and
the immediately adjacent real property is not under common ownership
or control, or that common ownership or control was gained solely for
purposes of sale of the electricity so generated and not for other
business purposes.
   (B) The useful thermal output of the facility generating the
electricity is not used on the immediately adjacent property for
petroleum production or refining.
   (C) The electricity furnished to the immediately adjacent property
is not utilized by a subsidiary or affiliate of the corporation or
person generating the electricity.
   (3) Sale or transmission to an electrical corporation or state or
local public agency, but not for sale or transmission to others,
unless the corporation or person is otherwise an electrical
corporation.
   (c) "Electrical corporation" does not include a corporation or
person employing landfill gas technology for the generation of
electricity for any one or more of the following purposes:
   (1) Its own use or the use of not more than two of its tenants
located on the real property on which the electricity is generated.
   (2) The use of or sale to not more than two other corporations or
persons solely for use on the real property on which the electricity
is generated.
   (3) Sale or transmission to an electrical corporation or state or
local public agency.
   (d) "Electrical corporation" does not include a corporation or
person employing digester gas technology for the generation of
electricity for any one or more of the following purposes:
   (1) Its own use or the use of not more than two of its tenants
located on the real property on which the electricity is generated.
   (2) The use of or sale to not more than two other corporations or
persons solely for use on the real property on which the electricity
is generated.
   (3) Sale or transmission to an electrical corporation or state or
local public agency, if the sale or transmission of the electricity
service to a retail customer is provided through the transmission
system of the existing local publicly owned electric utility or
electrical corporation of that retail customer.
   (e) "Electrical corporation" does not include an independent solar
energy producer, as defined in Article 3 (commencing with Section
2868) of Chapter 9 of Part 2.
   (f) The amendments made to this section at the 1987 portion of the
1987-88 Regular Session of the Legislature do not apply to any
corporation or person employing cogeneration technology or producing
power from other than a conventional power source for the generation
of electricity that physically produced electricity prior to January
1, 1989, and furnished that electricity to immediately adjacent real
property for use thereon prior to January 1, 1989.
   (g) A corporation or person engaged directly or indirectly in
developing, owning, producing, delivering, participating in, or
selling interests in, a shared renewable energy facility pursuant to
Chapter 7.6 (commencing with Section 2832) of Part 2, is not an
electrical corporation within the meaning of this section solely by
reason of engaging in any of those activities.  
  SEC. 4.    Section 2826.5 of the Public Utilities
Code is repealed.  
  SEC. 5.    Chapter 7.6 (commencing with Section
2832) is added to Part 2 of Division 1 of the Public Utilities Code,
to read:
      CHAPTER 7.6.  SHARED RENEWABLE ENERGY SELF-GENERATION PROGRAM


   2832.  The Legislature finds and declares all of the following:
   (a) The creation of renewable energy within California provides
significant financial, health, environmental, and workforce benefits
to the state of California.
   (b) The California Solar Initiative has been extremely successful,
resulting in over 140,000 residential and commercial onsite
installations of solar energy systems. However, it cannot reach all
residents and businesses that want to participate and is limited to
solar. The Shared Renewable Energy Self-Generation Program seeks to
build on this success by expanding access to renewable energy
resources to all ratepayers who are currently unable to access the
benefits of onsite generation.
   (c) The Governor has proposed the Clean Energy Jobs Plan calling
for the development of 12,000 megawatts of generation from
distributed renewable energy resources of up to 20 megawatts in size
by 2020. There is widespread interest from many large institutional
customers, including schools, colleges, universities, local
governments, businesses, and the military, for development of
renewable generation facilities to serve more than 33 percent of
their energy needs. For these reasons, the Legislature agrees that
the Governor's Clean Energy Jobs Plan represents a desired policy
direction for the state. It is the intent of the Legislature that
renewable generation that comes online as part of the Shared
Renewable Energy Self-Generation Program is counted toward an
electrical corporation's efforts to implement the Governor's Clean
Energy Jobs Plan.
   (d) Properly designed, shared renewable energy programs can
provide access and cost savings to underserved communities, such as
low- to moderate-income residents, and residential and commercial
renters, while not shifting costs to nonbeneficiaries.
   (e) While municipal utilities already have the authority to create
their own shared renewable energy programs, only an act of the
Legislature can empower the vast majority of California residents to
be able to enjoy the significant benefits of shared renewable energy
systems, while the state benefits from avoided transmission and
distribution upgrades, avoided line loss, and cleaner air and water.
   (f) Public institutions will benefit from the Shared Renewable
Energy Self-Generation Program's enhanced flexibility to participate
in shared renewable energy facilities. Electricity usage is one of
the most significant cost pressures facing public institutions at a
time when they have been forced to cut essential programs, increase
classroom sizes, and lay off teachers. Schools may use the savings
for restoring funds for salaries, facility maintenance, and other
budgetary needs.
   (g) Shared renewable energy self-generation creates jobs, reduces
emissions of greenhouse gases, and promotes energy independence.
   (h) Many large energy users in California have pursued onsite
renewable energy generation, but cannot achieve their goals due to
rooftop or land space limitations, or size limits on net metering.
The enactment of this chapter will create a mechanism whereby
institutional customers such as military installations, universities,
and local governments, as well as commercial customers and groups of
individuals, can efficiently invest in generating electricity from
renewable generation.
   (i) Therefore, it is the intent of the legislature that this
program be implemented in such a manner as to create a large,
sustainable market for the purchase of an interest in offsite
renewable generation, while fairly compensating electrical
corporations for the services they provide.
   (j) It is the further intent of the Legislature to preserve a
thriving, sustainable agricultural industry, and to ensure that the
development of renewable energy does not remove prime farmland from
productive use without a comprehensive public review process.
   (k) It is further the intent of the Legislature that the
commission minimize the rate impact the Shared Renewable Energy
Self-Generation Program has on nonbeneficiaries, with a goal of
ratepayer indifference. To the extent that the program imposes
incremental increases in rates, the commission shall determine the
appropriate way to allocate costs, which may include equitable
allocation of costs to all customers on a nonbypassable basis.
   2833.  As used in this chapter, the following terms have the
following meanings:
   (a) "Benefiting account" means one or more electricity accounts
designated to receive a bill credit pursuant to Section 2834 and
mutually agreed upon by the facility provider and an electrical
corporation.
   (b) "Bill credit" means an amount of money credited each month, or
in an otherwise applicable billing period, to one or more benefiting
accounts based on the amount of the electrical output of a shared
                                                 renewable energy
facility that is assigned to the account pursuant to the methodology
described in Section 2834.
   (c) "Default load aggregation point price" means a
commission-determined day-ahead price for electricity.
   (d) "Energy component" means the generation portion of a customer'
s otherwise applicable tariff and any other portion of the customer's
charges that the commission determines may be appropriate to offset
without resulting in a net cost shift to nonbeneficiaries.
   (e) "Facility rate" means the per kilowatthour rate assigned to
each facility built under the program, used to calculate the bill
credit pursuant to the method described in paragraphs (1) to (3),
inclusive, of subdivision (b) of Section 2834.
   (f) "Interest" means a direct or indirect ownership, lease,
subscription, or financing interest in a shared renewable energy
facility that enables the participant to receive a bill credit for a
retail account with the electrical corporation.
   (g) "Local government" means a city, county, city and county,
special district, school district, public water district, public
irrigation district, county office of education, political
subdivision, or other local governmental entity. For the purposes of
this chapter, "water district" has the same meaning as defined in
Section 20200 of the Water Code, and "irrigation district" means an
entity formed pursuant to the Irrigation District Law set forth in
Division 11 (commencing with Section 20500) of the Water Code.
   (h) "Participant" means a retail customer of an electrical
corporation who owns, leases, finances, or subscribes to an interest
in a shared renewable energy facility and who has designated one or
more of its own retail accounts as a benefiting account to which the
interest shall be attributed.
   (i) "Participant account" means a retail customer account with an
electrical corporation to which a participant's interest in a shared
renewable energy facility shall be attributed.
   (j) "Provider" means any entity whose purpose is to beneficially
own or operate a shared renewable energy facility for the
participants or owners of that facility, or to market an interest in
the facility.
   (k) "Program" means the Shared Renewable Energy Self-Generation
Program established pursuant to this chapter.
   (l) "Project" means the cumulative activities to build and make
operational a shared renewable energy facility.
   (m) "Renewable energy credit" has the same meaning as defined in
Section 399.12.
   (n) "Shared renewable energy facility" means a facility for the
generation of electricity that meets all of the following
requirements:
   (1) Has a nameplate generating capacity of no more than 20
megawatts of alternating current.
   (2) Is an eligible renewable energy resource pursuant to the
California Renewables Portfolio Standard Program (Article 16
(commencing with Section 399.11) of Chapter 2.3 of Part 1).
   (3) Has its electrical output measured by a production meter owned
by the electrical corporation, that meets the tariff requirements of
the electrical corporation and the Independent System Operator, and
that independently measures the electricity delivered to the grid by
the facility.
   (4) Is located within the service territory of a California
electrical corporation.
   (5) Has been interconnected with the electrical grid in compliance
with the tariffs of the applicable interconnection authority.
   (6) Is either the PVUSA facility, meaning the photovoltaic
electricity generation facility selected by the City of Davis and
located at 24662 County Road, Davis, California, or is a newly
constructed renewable facility constructed pursuant to this chapter,
beginning commercial operation on or after January 1, 2014.
   (7) The provider has, where applicable, complied with all program
rules and written notice procedures that may be required by the
commission.
   2834.  (a) (1) A retail customer of an electrical corporation
having 100,000 or more service connections within the state may
acquire an interest in a shared renewable energy facility for the
purpose of becoming a participant and shall designate one or more
benefiting accounts to which the interest shall be attributed.
   (2) To be eligible to be designated as a benefiting account, the
account shall be for service to premises located within the
geographical boundaries of the service territory of the electrical
corporation containing the shared renewable energy facility.
   (3) The participating customer's bill credit may be used to offset
all or a portion of the energy component of that customer's
electrical service, as provided in this chapter and in accordance
with those rules that the commission may adopt.
   (4) A participant shall not acquire an interest in a shared
renewable energy facility that represents more than two megawatts of
generating capacity or the equivalent amount, as denominated in
kilowatt hours of energy. This limitation does not apply to a
federal, state, or local government, school, school district, county
office of education, the California Community Colleges, the
California State University, or the University of California.
   (b) The commission shall establish a facility rate for all shared
renewable energy facilities, as follows:
   (1) The commission shall undertake a comprehensive analysis of the
costs and benefits associated with shared renewable energy
generation to determine a facility rate for all facilities
participating in the program that shall be based on the full value
that the shared renewable energy generation provides. No later than
December 31, 2014, the commission shall adopt a methodology to
calculate a facility rate for shared renewable energy.
   (2) In order to ensure that the program becomes effective on
January 1, 2014, an interim facility rate shall be set at the market
price referent, as currently determined by the commission.
   (3) The facility rate shall be set annually as a price per
kilowatthour of electricity and shall be applied at the time the
provider receives an award of capacity. Once established, a facility
rate shall be applicable to that facility for the operational life of
the facility, except as allowed in paragraph (1) of subdivision (c).

   (4) The commission shall publish tariffs applicable to all
participants per electrical corporation, as necessary, no later than
90 days following the addition of this section.
   (5) Any subsequent facility or a subsequent expansion of a
facility placed in service on or after the initial award of rated
generating capacity pursuant to paragraph (3) that results in an
increase in the facility's capacity to produce electricity shall be
subject to the facility rate in effect on the date the provider
applied for an award of rated generating capacity for the subsequent
facility or increase in the facility's capacity.
   (6) The electrical corporation shall assign a monthly bill credit
equal to the facility rate for each kilowatt hour of energy received
to the benefiting account, as directed by the provider. The bill
credit shall be applied to the energy component of the benefiting
account.
   (c) (1) The commission may revise the methodology for calculating
facility rates at any time that it concludes that the existing
mechanism does not provide program participants with the fair value
of electricity and other benefits produced by the shared renewable
energy facility or overvalues the benefits to nonparticipating
customers of the electrical corporation for the electricity generated
by a shared renewable energy facility. Any revision to the
methodology for calculating the facility rate shall apply to all new
program capacity and shall also apply to existing program capacity
provided the change results in an increase to the facility rate.
   (2) Any renewable energy credits associated with an interest shall
be retired by either the provider or electrical corporation, as they
may agree, on behalf of the participant or transferred to the
Western Renewable Energy Generation Information System account of
that participant, for the purpose of demonstrating the purchase of
renewable energy. Those renewable energy credits shall not be further
sold, transferred, or otherwise monetized by a party for any
purpose. Renewable energy credits associated with electricity paid
for by the electrical corporation shall be counted toward meeting
that electrical corporation's renewables portfolio standard. For
purposes of this subdivision, "renewable energy credit" and
"renewables portfolio standard" have the same meanings as defined in
Section 399.12.
   (3) For energy that is unallocated to a benefiting account during
the previous billing period, the recipient electrical corporation
shall pay the provider the current default load aggregation point
price plus the renewable energy credit value and receive any
renewable energy credits associated with that energy.
   (d) (1) A pilot program of 1000 megawatts of alternating current
rated nameplate generating capacity of shared renewable energy
facilities shall be made available during the 18-month period
beginning January 1, 2014, and ending July, 1 2015. Each electrical
corporation's proportionate share of the program's total capacity
shall be calculated based on the ratio of the electrical corporation'
s peak demand compared to the total statewide peak demand.
   (2) On or before March 1, 2014, each electrical corporation shall
submit a proposal to the commission for how to allocate the initial
available capacity. Within 60 days of receipt of these proposals, the
commission shall adopt rules for the allocation of the initial
available capacity amongst the electrical corporations and to
establish a transparent process for evaluating and ranking
applications for shared renewable energy facility projects and
awarding the initial capacity to those projects.
   (3) Of the initial pilot program capacity:
   (A) Twenty percent shall be reserved for projects of a size no
greater than one megawatt of alternating current, constructed in
areas previously identified by the California Environmental
Protection Agency as the most impacted and disadvantaged communities
for opportunities related to this chapter. These communities shall be
identified as census tracts that are identified within the top 20
percent of results from the best available cumulative impact
screening methodology by considering the following categories:
   (i) Areas disproportionately affected by environmental pollution
and other hazards that can lead to negative public health effects,
exposure, or environmental degradation.
   (ii) Areas with socioeconomic vulnerability.
   (B) Twenty percent shall be reserved for initial subscription by
residential customers.
   (4) No shared renewable energy facilities under this program may
be sited on lands that have held, within the previous five years, a
land use designation of prime farmland as defined by the Department
of Conservation's Farmland Mapping and Monitoring Program pursuant to
Section 65570 of the Government Code, except when the designation
has been reclassified to one congruent to the use of the site for the
purposes of this chapter by either the Farmland Mapping and
Monitoring Program, or via a public process conducted by the relevant
local land use management planning authority.
   (e) Each electrical corporation shall make awards allocating rated
generating capacity pursuant to the program in the following manner:

   (1) (A) Each electrical corporation shall, by March 1, 2014,
submit a proposed standard contract with providers for commission
approval. The commission shall utilize the Tier 2 advice letter
procedure for approval of a standard contract submitted by an
electrical corporation.
   (B) The proposed standard contract shall be based on the
electrical corporation's standard contract used for the commission's
most recently approved renewable auction mechanism program. Each
electrical corporation shall modify the contract to eliminate
language irrelevant to this program, including, but not limited to,
compensation and monthly payments, operating and development
security, and time-of-day periods.
   (2) A provider wishing to build a shared renewable energy facility
shall remit a nonrefundable administrative fee of one dollar and
fifty cents ($1.50) per kilowatt of rated generating capacity to the
electrical corporation with its application for an allocation of
capacity. At any time, the commission shall have the authority to
modify the rated generating capacity allocation mechanism, including,
but not limited to, creating project ranking criteria, setting
deposit requirements, and creating an award allocation methodology
for prospective projects.
   (3) A provider shall meet the following benchmarks and timelines
for construction and operation of a shared renewable energy facility.
Failure to do so shall result in the provider forfeiting the rated
generating capacity awarded to it.
   (A) The provider shall issue an unrestricted notice to proceed
with construction of the shared renewable energy facility within 180
days of the provider receiving an award allocating rated generating
capacity from the electrical corporation.
   (B) The shared renewable energy facility shall achieve commercial
operation within 24 months of receiving an award allocating rated
generating capacity pursuant to this subdivision.
   (C) A provider shall receive an extension because of
interconnection delays that are outside the provider's control, for a
maximum extension of six months.
   (D) A provider may receive a six-month extension for
noninterconnection factors outside the control of the provider.
   (4) The electrical corporation shall ensure that no single entity
or its affiliates or subsidiaries is awarded more than 20 percent of
any single calendar year's total cumulative rated generating capacity
made available pursuant to this program.
   (5) The commission shall maintain a public database of facility
rates for shared renewable energy facilities that have achieved
commercial operation.
   (f) (1) Once the initial 1000 megawatts of cumulative rated
generating capacity has been awarded for shared renewable energy
facility projects, the commission shall evaluate the functioning of
the program.
   (2) By July 1, 2015, the commission shall conclude an evaluation
of the program to date, to determine if the goals of the program are
being met, including, but not limited to, the goals of increasing
access to renewable power and ensuring nonbeneficiary ratepayer
indifference.
   (3) Unless the commission determines that the program goals are
not being met per the goals and timetable identified in paragraph (1)
of subdivision (d), the commission shall authorize additional
capacity to be made available under this program in keeping with the
stated legislative intent, and determine the capacity allocation and
manner of participation by residential customers specified in
subparagraph (B) of paragraph (3) of subdivision (d) and the capacity
allocation for developing projects in areas specified in
subparagraph (A) of paragraph (3) of subdivision (d).
   (4) If the commission determines that one or more of the goals are
not being met, the commission shall revise the program prior to
authorizing additional capacity. Revisions may include increasing
customer disclosure information or other safeguards to ensure
customer protection, revising capacity set-asides for customer
classes or project sizes to increase customer access to the program,
alterations in the bill credit mechanism in paragraph (1) of
subdivision (c) to ensure shared renewable energy facilities are
financially viable through this program while ensuring that all
ratepayers are paying for the benefits they receive from this
program, or other revisions the commission deems necessary to ensure
the program goals can be met. After the commission has revised the
program, the commission may authorize additional capacity to be
released provided in accordance with paragraph (2) of subdivision
(d).
   (5) Following completion of the pilot program, the commission may
evaluate the program at any time, either on its own motion or upon
motion by an interested party, and may modify or adopt any rules it
determines to be necessary or convenient to ensure that program goals
can be met.
   (6) An electrical corporation shall comply with the requirements
applicable to protection of the right to commercial free speech
described in Commission Decision 10-05-050 as applied to the
development, sale of subscriptions, and operation of shared renewable
energy facilities. Shared renewable energy facilities may file a
complaint with the commission for violation of this paragraph.
   (7) If requested by a city, county, or city and county, an
electrical corporation shall annually provide the city, county, or
city and county with the annual total generation of each shared
renewable energy facility in that local jurisdiction and the annual
aggregated total generation, by fuel type, allocated to benefiting
accounts in that local jurisdiction from all shared renewable energy
facilities, regardless of their location. The benefiting account data
shall be aggregated in a manner determined by the commission to
protect customer privacy and to provide a city, county, or city and
county with the information necessary to calculate greenhouse gas
emissions from energy consumption within its jurisdiction supplied by
shared renewable energy facilities. The commission may develop
alternative methods to enable the sharing of annual total generation
information.
   (g) (1) The tariff applicable to a participant shall remain the
same, with respect to rate structure, all retail rate components, and
any monthly charges, to the charges that the participant would be
assigned if the participant did not receive a bill credit.
Participants shall not be assessed standby charges on the shared
renewable energy facility or the kilowatthour generation of a shared
renewable energy facility.
   (2) Prior to the sale or resale of an interest in a shared
renewable energy facility, the provider or the participant, or both,
shall provide a disclosure to the potential participant that, at a
minimum, includes all of the following:
   (A) A good faith estimate of the annual kilowatthours to be
delivered by the shared renewable energy facility based on the size
of the interest.
   (B) A plain language explanation of the terms under which the bill
credits will be calculated.
   (C) A plain language explanation of the contract provisions
regulating the disposition or transfer of the interest.
   (D) A plain language explanation of the costs and benefits to the
potential participant based on its current usage and applicable
tariff, for the term of the proposed contract.
   (3) Not more frequently than once per month, and upon providing
the electrical corporation with a minimum of 30 days' notice, the
participant organization may change, add, or remove a benefiting
account. If the owner of a benefiting account transfers service to a
new address or benefiting account, the electrical corporation shall
transfer any credit remaining from the previous account to the new
account.
   (4) A provider shall be responsible for providing to the
electrical corporation, on a monthly basis, a statement of the
kilowatthours allocated to each participant to be used to determine
the bill credit to each benefiting account. If there has been no
change in the allocations from the previous submission, the provider
is not required to submit a new statement. An electrical corporation
may rely on the statement of kilowatthours allocated to each
participant, as provided by the provider, in implementing the
requirements of this chapter.
   (5) The provider shall provide real-time meter data to the
electrical corporation and shall make the data available to a
participant upon request. A provider shall be responsible for all
costs of metering and shall retain production data for a period of 36
months.
   (6) A provider shall provide to the electrical corporation
information on the identity of the benefiting accounts that will
receive a bill credit pursuant to this section not less than 30 days
prior to the billing cycle for which the participant's account will
receive a bill credit.
   (7) A provider shall provide not less than 60 days' notice to the
electrical corporation prior to the date the shared renewable energy
facility becomes operational and shall execute all necessary
interconnection agreements, participation, and surplus sale
agreements with the electrical corporation and the Independent System
Operator on a schedule required by those entities.
   (8) Unless the electrical corporation will be registering
renewable energy credits on behalf of the participant, the provider
shall establish an account and register the shared renewable energy
facility with the Western Renewable Energy Generation Information
System or its successor.
   (9) The provider's interconnection process and cost allocation for
facilities built under this section shall be determined by
applicable rules for interconnection established by the commission
and the Independent System Operator.
   (10) An electrical corporation shall ensure that requests for
establishment of bill credits and changes to benefiting accounts are
processed in a time period not to exceed 30 days from the date it
receives the request.
   (11) An electrical corporation shall cooperate fully with shared
renewable energy facilities to implement this chapter.
   (12) The commission shall not regulate the prices paid by the
participant for an interest in a shared renewable energy facility,
but may enforce the required disclosures, and may establish rules
applicable to providers to ensure consumer protection. Any interested
person or corporation may file a complaint with the commission
contending that a provider or electrical corporation is not complying
with any requirement of this chapter and seek an order of the
commission to enforce the requirements of this chapter and to take
whatever steps are necessary to ensure consumer protection and
compliance with the requirements of this chapter.
   (h) (1) The electrical corporation may petition the commission to
incorporate in its bill those charges by the provider to
participants, provided that the electrical corporation recovers all
incremental costs of providing that service and provided that the
provider elects to use this service.
   (2) Unless the electrical corporation elects to provide the
service of incorporating in its bill those charges by the provider to
the participant pursuant to paragraph (3), the following process
shall be used when billing and crediting a benefiting account:
   (A) An electrical corporation shall bill a benefiting account for
all electricity usage, and for each applicable bill component,
including, but not limited to, transmission and distribution charges,
at the rate schedule applicable to the benefiting account, including
any cost-responsibility surcharge or other cost recovery mechanism,
as determined by the commission, to reimburse the Department of Water
Resources for purchases of electricity pursuant to Division 27
(commencing with Section 80000) of the Water Code. Participants shall
not be subject to any departing load charge.
                                                      (B) An
electrical corporation shall subtract the bill credit applicable to
the benefiting account monthly. The electrical corporation shall
ensure that the participant receives the full bill credit to which it
is entitled. The information and line items on a participant's bill
statement will be unchanged, except one or more entries detailing the
bill credit that shall be added to a participant's bill.
   (C) If, at the end of each billing cycle, the total otherwise
applicable energy component of the bill exceeds the bill credit, the
benefiting account shall be billed for the difference.
   (D) If, at the end of a billing cycle, the bill credit exceeds the
energy component of the amount billed to the account, the difference
shall be carried forward as a dollar credit to the next billing
cycle. Any earned credit that exceeds the energy component of the
bill shall roll over to the subsequent billing period and shall
continue to roll over until used or until the annual anniversary date
of the participant's initial bill credit, whichever occurs first. On
the annual anniversary date of the participant's initial bill
credit, any remaining bill credit earned during the previous year and
that remains after the application of bill credits to the energy
component of a participant's bills shall cease to roll over and will
be subject to a default load aggregation point price true-up. The
default load aggregation point price true-up shall be calculated by
converting the remaining unused bill credits to kilowatthours, by
dividing the unused bill credits by the monetary value of a bill
credit, and then multiplying the kilowatthours by the default load
aggregation point price. The amount calculated doing the default load
aggregation point price true-up is owed by the electrical
corporation to the participant. The commission shall determine
whether the default load aggregation point price true-up is to be
paid to participants or credited to future billings and, if so, the
manner of crediting.
   (3) If the electrical corporation elects to incorporate in its
bill those charges by the provider to the participant, the following
process shall be used for the bundled electric service customers of
the electrical corporation:
   (A) The provider shall convey ownership of the electricity
generated by the shared renewable energy facility that passes through
the meter and is delivered to the transmission or distribution grid
(delivered electricity) to the electrical corporation under terms and
conditions determined between the provider and the electrical
corporation, pursuant to paragraph (1) of subdivision (e).
   (B) Unsubscribed delivered electricity shall be sold to the
electrical corporation at the default load aggregation point price
plus the renewable energy credit value. The electrical corporation
shall receive credit under the California Renewable Portfolio
Standard Program (Article 16 (commencing with Section 399.11) of
Chapter 2.3 of Part 1) for all delivered electricity purchased
pursuant to this subparagraph, without the need for further
qualifying action.
   (C) The electrical corporation shall charge the participant for
service under each benefiting account at the electrical corporation's
otherwise applicable tariff.
   (D) The electrical corporation shall provide the participant with
a bill credit based on the allocated share of delivered electricity
and shall collect revenue from the participant commensurate with the
participant's contract with the provider.
   (E) The electrical corporation, within 60 days, shall remit to the
participant organization the revenue collected from participants
through billings pursuant to subparagraph (D).
   (4) Nothing in paragraph (3) requires a particular bill format or
the inclusion of any specific separate billing line items.
   (5) The commission shall, by January 1, 2015, determine whether
customers participating in direct transactions may receive bill
credits equivalent to what would be provided to bundled electric
service customers of a participating electrical corporation pursuant
to this chapter, and, if so, shall implement rules and procedures for
enabling those transactions. These particular transactions may
include those with an electric service provider that does not provide
distribution services, customers receiving electric service through
a shared choice aggregation program, and customers of a local
publicly owned utility that receive distribution service from an
electrical corporation having 100,000 or more service connections in
California.
   (i) (1) To ensure the maximum systemic benefit from shared
renewable energy facilities under this chapter, electrical
corporations shall provide to the commission, prior to the release of
capacity, maps indicating locations in their service territory where
the addition of capacity would reduce line loss, lower transmission
capacity constraints, and defer or avoid transmission and
distribution network upgrades and construction. The commission may
adopt guidance in determining criteria for the awarding of capacity
in a manner as to reflect these benefits.
   (2) Before December 31, 2015, the commission shall complete an
evaluation of whether the program causes any incremental rate
impacts. If the commission finds rate impacts, it will determine
whether and how to allocate these costs equitably to all program
participants, or instead recover on a fully nonbypassable basis from
all customers receiving distribution service from an electrical
corporation, including ratepayers with rates that are otherwise
subject to rate increase limitations pursuant to Section 739.9, but
excluding customers in the California Alternate Rates for Energy
(CARE) or family electric rate assistance (FERA) programs.
   (3) On or before February 1, 2016, the commission shall require
each electrical corporation to file with the commission, for its
approval, any revisions to its tariffs, rates, and rate design as are
necessary to ensure an equitable allocation to all customers,
consistent with the commission's evaluation.
   (4) The commission shall ensure full and timely recovery of all
reasonable costs incurred by an electrical corporation to implement
the program, including reasonable expenses for changes to its billing
system and handling of collections, and shall determine the
appropriate method of allocating those costs. The commission shall
approve a memorandum account to track billing system and
implementation costs, as well as revenue from provider project
applications, and may not direct an electrical corporation to conduct
any billing system work prior to approval of the memorandum account.

   (5) In calculating its procurement requirements to meet the
requirements of the California Renewables Portfolio Standard Program
(Article 16 (commencing with Section 399.11) of Chapter 2.3 of Part
1), an electrical corporation may exclude from total retail sales the
kilowatthours generated by a shared renewable energy facility
commencing with the point in time at which the facility achieves
commercial operation.
   (6) The local and system resource adequacy value attributable to a
shared renewable energy facility, as determined by the commission
pursuant to Section 380, shall be assigned to the electrical
corporation to which the facility is interconnected. 

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