Amended in Senate June 25, 2013

Amended in Assembly May 29, 2013

Amended in Assembly May 24, 2013

Amended in Assembly April 23, 2013

Amended in Assembly April 9, 2013

Amended in Assembly March 21, 2013

California Legislature—2013–14 Regular Session

Assembly Bill No. 1295

Introduced by Assembly Member Roger Hernández

February 22, 2013

An act to add and repeal Chapter 7.6 (commencing with Section 2831) of Part 2 of Division 1 of the Public Utilities Code, relating to public utilities.

LEGISLATIVE COUNSEL’S DIGEST

AB 1295, as amended, Roger Hernández. Public utilities: renewable energy: community renewables option.

Under existing law, the Public Utilities Commission has regulatory jurisdiction over public utilities, including electrical corporations, as defined, while local publicly owned electric utilities, as defined, are under the direction of their governing boards. 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.

The California Renewables Portfolio Standard Program, referred to as the RPS program, requires a retail seller of electricity, as defined, and local publicly owned electric utilities to purchase specified minimum quantities of electricity products from eligible renewable energy resources, as defined, for specified compliance periods, sufficient to ensure that the procurement of electricity products from eligible renewable energy resources achieves 20% of retail sales for the period January 1, 2011, to December 31, 2013, inclusive, 25% of retail sales by December 31, 2016, and 33% of retail sales by December 31, 2020, and in all subsequent years. The RPS program, consistent with the goals of procuring the least-cost and best-fit eligible renewable energy resources that meet project viability principles, requires that all retail sellers procure a balanced portfolio of electricity products from eligible renewable energy resources, as specified.

This bill would require an electrical corporation to provide a community renewables option begin insert , as specified, end insert allowing a subscribing customer’s bill be adjusted to reflect the customer’s subscription in the output of a community renewables facility. The bill would require the commission to authorize the tariff for community renewables option by July 1, 2014. The bill would, on and after January 1, 2016, require the commission to evaluate the demand for the community renewables option. If the commission finds that the community renewables option should be discontinued, the bill would make the above provisions inoperative. The bill would authorize a local publicly owned utility to offer a community renewables option. This bill would repeal the provision of the community renewables option on January 1, 2020.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: no.

The people of the State of California do enact as follows:

SECTION 1.  

Chapter 7.6 (commencing with Section 2831) is
added to Part 2 of Division 1 of the Public Utilities Code, to read:

 

Chapter  7.6. Community Renewables Facility

 

2831.  

As used in this article, the following terms mean the
following:

(a) “Community renewables facility” means an electric
generation facility that has elected to participate in the community
renewables option.

(b) “Community renewables option” means the right of an
electric generation facility to participate in a program that allows
a customer to subscribe to the output of an electric generation
facility.

begin insert

(c) “Community renewables rate” means the charge to
subscribing customers for generation of electricity under the
community renewables option that includes all of the following:

end insert begin insert

(1) The contract price paid to procure renewable resources to
serve the community renewables subscription amount of the
subscribing customer.

end insert begin insert

(2) Customer departing load charges.

end insert begin insert

(3) Renewable integration charges, as determined by the
commission.

end insert begin insert

(4) Charges to recover the costs, if any, to procure sufficient
resources to adequately serve subscribing customers.

end insert begin insert

(5) Charges to cover the cost of program administration.

end insert begin insert

(d) “Contract price” means the payment that is due to the
electric generation facility in accordance with a power purchase
contract executed pursuant to an eligible procurement program
described in a cents per kilowatthours payment.

end insert begin delete

(c)

end delete

begin insert (e) end insert  “Electric generation facility” means begin delete an electric generation end delete
begin insert a generating end insert facility located within the service territory of, and
developed to sell electricity to, an electrical corporation that meets
all of the following criteria:

(1) Has an effective capacity of not more than begin delete three end delete begin insert 20 end insert
megawatts.

(2) Is interconnected and operates in parallel with the electrical
transmission and distribution grid.

(3) Is strategically located and interconnected to the electrical
transmission and distribution grid in a manner that optimizes the
deliverability of electricity generated at the facility to load centers.

(4) Is an eligible renewable energy resource, as defined in
Section 399.12.

begin delete

(5) Meets all the requirements established pursuant to Section
399.20 that are applicable to electric generation facilities.

end delete begin delete

(d) “Feed-in tariff payment” means the payment that is due to
the electric generation facility in accordance with the tariff or
standard contract established pursuant to Section 399.20 as
described in a monthly total payment.

end delete begin insert

(5) Begins commercial operation on or after January 1, 2012.

end insert begin insert

(f) “Eligible procurement program” means a competitively
priced renewable procurement mechanism.

end insert begin insert

(g) “Generation rate” means the generation component of the
customer’s energy or capacity rate, or both, through which the
electrical corporation recovers energy procurement costs.

end insert begin delete

(e)

end delete

begin insert (h) end insert  “Subscribing customer” means a customer of an electrical
corporation who has subscribed to the output of a community
renewables facility.

begin delete

(f)

end delete

begin insert (i) end insert  “Subscription amount” means the begin delete percentage of end delete kilowatthours
delivered to an electrical corporation from a community renewables
facility to which a subscribing customer has subscribed.

begin delete

(g)

end delete

begin insert (j) end insert  “Unsubscribed output” means the begin delete percentage of end delete
kilowatthours delivered to an electrical corporation from a
community renewables facility to which no subscribing customer
has subscribed.

2831.5.  

A community renewables facility is not an electrical
corporation, as defined in Section begin delete 218 end delete begin insert 218, end insert or an electric service
provider, as defined in Section begin delete 218.3 end delete begin insert 218.3, solely by virtue of
being a community renewables facility end insert .

2832.  

(a) An electrical corporation shall provide begin insert , via a tariff
advice filing or application approved by the commission, end insert a
community renewables option that allows a subscribing customer’s
bill to be adjusted to reflect the customer’s subscription.

begin insert

(b) The electrical corporation shall charge a community
renewables rate in place of the customer’s otherwise applicable
generation rate for the customer’s subscription amount. Other
application electricity charges shall remain without modification.
The community renewables rate shall ensure that nonsubscribing
customers are unaffected by the community renewables option.

end insert begin delete

(b)

end delete

begin insert (c) end insert  In approving the begin delete tariff end delete begin insert community renewables option end insert , the
commission shall ensure all of the following:

(1) Customers that do not participate in the community
renewables option are indifferent to whether other customers
participate in the community renewables option, and no costs are
shifted from subscribing customers to nonsubscribing customers.

begin insert

(2) An electric generation facility that executes a power
purchase contract with an electrical corporation may, in its sole
discretion, make an election to become a community renewables
facility.

end insert begin delete

(2)

end delete

begin insert (3) end insert  An electric generation facility that has begin delete executed a standard
contract with an electrical corporation and has begun deliveries
pursuant to the contract end delete begin insert begun commercial operation before the
community renewables option is implemented end insert may, begin delete in its end delete begin insert for a
limited time to be determined by the commission, in the electric
generation facility’s end insert sole discretion, begin delete elect end delete begin insert make an election end insert to
become a community renewables facility.

begin delete

(3)

end delete

begin insert (4) end insert  (A) The community renewables facility is solely responsible
for any and all arrangements, agreements, or disputes with its
subscribing customers concerning begin delete the community renewables
option end delete begin insert their subscription or subscriptions to the output of the
community renewables facility end insert . The community renewables facility
shall communicate, in writing, to the electrical corporation, in a
timely manner, to be specified in the electrical corporation’s tariff
and contract, but not less than once per year, information necessary
for the electrical corporation to administer the community
renewables option that includes, but is not limited to, all of the
following:

(i) The name of each subscribing customer.

(ii) The service address and service account number of each
subscribing customer to which a bill adjustment should be applied.

(iii) Each subscribing customer’s subscription amount.

begin delete

(iv) The unsubscribed output, if any, for which payment should
be made directly to the community renewables facility.

end delete

(B) The electrical corporation shall not be a party to an
arrangement or agreement between the community renewables
facility and the subscribing customer.

begin insert

(C) A customer’s subscription to the output of a community
renewables facility pursuant to this section is a not a direct
transaction pursuant to subdivision (c) of Section 331.

end insert begin insert

(5) (A) The community renewables facility shall be required to
establish, in its contract with the electrical corporation under an
eligible procurement program, the portion of the facility’s output
that will be subscribed to by subscribing customers under the
community renewables option.

end insert begin insert

(B) The electrical corporation shall have the right to recover
from the community renewables facility any procurement costs
that are above the procurement costs that would otherwise be
incurred by the electrical corporation in meeting its renewables
portfolio standard procurement requirements pursuant to Section
399.15 due to a community renewables facility’s failure to maintain
subscriptions for the portion of the facility output as contractually
agreed to in subparagraph (A).

end insert begin delete

(4)

end delete

begin insert (6) end insert  The electrical corporation shall pay the community
renewables facility for any unsubscribed output begin insert , as determined in
establishing the subscribed output pursuant to subparagraph (A)
of paragraph (5), end insert by multiplying the unsubscribed output by begin delete the
feed-in tariff payment end delete begin insert the contract price end insert .

begin delete

(5)

end delete

begin insert (7) end insert  (A) Customer subscriptions shall not be credited towards
the electrical corporation’s procurement requirements pursuant to
Section 399.15 begin delete but shall continue to count toward end delete begin insert or end insert the electrical
corporation’s proportionate share of begin delete the statewide cap specified
in Section 399.20 end delete begin insert an eligible procurement program’s statewide
cap end insert .

begin insert

(B) Incremental procurement under this section shall be limited
to the electricity necessary to serve the community renewables
subscription amounts of subscribing customers. This section does
not require an electrical corporation to procure or pay for
unsubscribed output in excess of an eligible procurement
program’s statewide cap.

end insert begin delete

(B)

end delete

begin insert (C) end insert  In calculating its procurement requirements pursuant to
Section 399.15, an electrical corporation may exclude from the
total retail sales the kilowatthours subscribed to by participating
customers pursuant to this section.

begin delete

(6)

end delete

begin insert (8) end insert  Any unsubscribed output from a community renewables
begin delete generator end delete begin insert facility end insert shall continue to be credited towards the electrical
corporation’s procurement requirements pursuant to Section 399.15
and shall count toward the electrical corporation’s proportionate
share of the begin insert eligible procurement program’s end insert statewide begin delete cap specified
in Section 399.20 end delete begin insert cap end insert .

begin delete

(c)

end delete

begin insert (d) end insert  No later than July 1, 2014, the commission shall authorize
the tariff for the community renewables option consistent with this
section, including setting a reasonable cap on total megawatts that
can be subscribed to under a community renewables program
pursuant to this begin delete section. end delete begin insert section, not to exceed 600 megawatts
statewide and to be coordinated with any other customer renewable
option or green rate programs. The commission shall ensure that
the megawatts offered under this cap are both of the following: end insert

begin insert

(1) Allocated among electrical corporations in proportion to
their contribution to statewide peak electricity demand.

end insert begin insert

(2) Distributed evenly over the life of the community renewables
program.

end insert begin delete

(d) Notwithstanding paragraphs (1) and (5) of subdivision (c)
of Section 2831, the commission may allow the renewable
programs adopted by the commission in commission decisions
10-12-048 and 09-06-049 to include a community renewables
option if the community renewables option meets the requirements
of subdivision (c). All purchases pursuant to this subdivision shall
count toward the electrical corporation’s proportional share of the
program’s cap.

end delete

(e) An electrical corporation shall recover from the community
renewables facility any costs of implementing the community
renewables option reasonably attributable to the community
facility. Any implementation costs not reasonably attributable to
the community renewables facility shall be recovered from begin delete the end delete
begin insert participating end insert ratepayers, as determined by the commission.

(f) If a customer participates in direct transactions pursuant to
paragraph (1) of subdivision (b) of Section 365 or Section 365.1,
the electrical corporation that provides distribution service for the
customer is not obligated to allow that customer to participate in
a community renewables option.

(g) (1) On and after January 1, 2016, the commission shall
evaluate the demand for the community renewables option and
consider whether to continue offering a community renewables
option.

(2) If the commission determines that the community renewables
option should terminate, the commission shall issue an order to
that effect and deliver a copy of the order to the Secretary of State.
The section shall become inoperative on the effective date of the
order.

begin insert

(h) An electrical corporation may voluntarily offer a renewable
energy tariff to its retail customers notwithstanding any limitation
in paragraph (3) of subdivision (b) of Section 399.15. Nothing in
Section 399.15 shall prohibit an electrical corporation from
voluntarily offering a renewable energy tariff.

end insert

2832.5.  

A local publicly owned electric utility required to
comply with Section 399.32 may offer a community renewables
option for an electric generation facility as defined in Section
399.32.

2833.  

This chapter shall remain in effect only until January 1,
2020, and as of that date is repealed, unless a later enacted statute,
that is enacted before January 1, 2020, deletes or extends that date.