BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 2363|
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THIRD READING
Bill No: AB 2363
Author: Dahle (R), et al.
Amended: 8/18/14 in Senate
Vote: 21
SENATE ENERGY, UTIL. & COMM. COMM. : 10-0, 6/23/14
AYES: Padilla, Fuller, Cannella, Corbett, De León, DeSaulnier,
Hill, Knight, Pavley, Wolk
NO VOTE RECORDED: Block
SENATE APPROPRIATIONS COMMITTEE : 5-0, 8/14/14
AYES: De León, Hill, Lara, Padilla, Steinberg
NO VOTE RECORDED: Walters, Gaines
ASSEMBLY FLOOR : 76-0, 5/27/14 - See last page for vote
SUBJECT : Electricity procurement
SOURCE : California Biomass Energy Alliance
Calpine Corporation
DIGEST : This bill directs the Public Utilities Commission
(PUC) to adopt estimates of expenses resulting from integrating
and operating eligible renewable energy resources including, but
not limited to, any wholesale energy and capacity costs
associated with integrating each eligible renewable resource, as
specified.
ANALYSIS :
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Existing law:
1. Establishes procurement requirements that electrical
corporations (investor-owned utilities [IOUs]) and public
utilities must meet in order to attain a target of 33%
renewable generation in their electricity supply portfolios
by 2020. It further requires that IOUs procure eligible
resources based on a "least-cost, best-fit" methodology,
rather than directing procurement of specific energy resource
types.
2. Requires each IOU is to annually prepare a renewable energy
procurement plan and directs the PUC to review and approve
those plans.
3. Requires IOUs to file, and the PUC to review and approve,
long-term procurement plans to ensure that the IOUs have
sufficient and diverse short- and long-term electricity and
demand reduction resources that are cost-effective, reliable,
and feasible to serve its customers. The plans must show
that the IOUs will achieve Renewables Portfolio Standard
(RPS) requirements and first meet unmet resource needs with
energy efficiency and demand response resources that are cost
effective, reliable, and feasible. This is called long-term
procurement planning (LTPP).
This bill:
1. Directs the PUC to adopt estimates of expenses resulting from
integrating and operating eligible renewable energy
resources, i.e., "integration costs," including, but not
limited to, any wholesale energy and capacity costs
associated with integrating each eligible renewable resource.
2. Requires the PUC to approve, no later than December 31, 2015,
a methodology for determining integration costs and require
the PUC to direct IOUs to include integration costs in their
LTPP and renewable energy procurement plan.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee, one-time costs
of $600,000 to the Public Utilities Reimbursement Account
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(special) for the PUC for contracts to develop necessary models.
SUPPORT : (Verified 8/15/14)
California Biomass Energy Alliance (co-source)
Calpine Corporation (co-source)
ADM Rice, Inc.
Agricultural Energy Consumers Association
Athens Services
Bio Energy Association of California
California Biomass Alliance
California Farm Bureau Federation
California Fire Safe Council
California Forestry Association
California Independent Energy Producers
California League of Conservation Voters
California Manufacturing and Technology Association
California Wind Energy Association
California Women in Agriculture
Coalition for Renewable Natural Gas
Community Alliance of Family Farmers
Covanta Delano, Inc.
Covanta Mendota
Delano Chamber of Commerce
Environment California
Environmental Defense Fund
Greenleaf Power
HL Power Company
IHI Power Generation
Imperial Irrigation District
Lake County Board of Supervisors
Lassen County
Natural Resources Defense Council
PacificCorp
Paramount Farms
Plumas County Fire Safe
Rural County Representatives of California
San Diego Gas and Electric
San Joaquin Valley Air Pollution Control District
Sierra County
Sierra Pacific Industries
Southern California Edison
Tubit Enterprises Inc.
Tuolumne County Business Council
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Tuolumne County Chamber of Commerce
Tuolumne County Economic Development Authority
U. S. Green Building Council
Union of Concerned Scientists
Wadham Energy
Women in Timber
OPPOSITION : (Verified 8/15/14)
Large-Scale Solar Association
ARGUMENTS IN SUPPORT : According to the author's office, it is
important to promote a policy that will assist the state's RPS
to ensure that the procurement process creates a more level
playing field and evaluates all new and existing renewable
resources accurately and fairly. The result will be a more
diverse and cost-effective portfolio of renewable energy
resources, which will help to balance the grid and maintain
reliability while keeping consumer electric rates affordable.
ARGUMENTS IN OPPOSITION : The Large-Scale Solar Association
states, "The [PUC] and the CAISO [California Independent System
Operator] are currently undertaking flexibility studies to
determine whether and to what extent costs are associated with
integrating renewable energy into the state's grid. The [PUC]
is also in the process of determining the appropriate costs of
integration, to assign - if any.
"It's crucial for both market and regulatory stability that the
PUC and CAISO continue to perform their analyses unimpeded and
that they develop integration adders based on factual, real-time
grid operations and needs. Absent this ability, the flexibility
to ensure reliable energy deliver could be compromised."
ASSEMBLY FLOOR : 76-0, 5/27/14
AYES: Achadjian, Alejo, Allen, Ammiano, Bigelow, Bloom,
Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian
Calderon, Campos, Chau, Chávez, Chesbro, Conway, Cooley,
Dababneh, Dahle, Daly, Dickinson, Donnelly, Eggman, Fong, Fox,
Frazier, Beth Gaines, Garcia, Gatto, Gomez, Gonzalez, Gordon,
Gorell, Gray, Grove, Hagman, Hall, Harkey, Roger Hernández,
Holden, Jones, Jones-Sawyer, Levine, Linder, Logue, Lowenthal,
Maienschein, Mansoor, Medina, Melendez, Mullin, Muratsuchi,
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Nazarian, Nestande, Olsen, Pan, Perea, John A. Pérez, V.
Manuel Pérez, Quirk, Rendon, Ridley-Thomas, Rodriguez, Salas,
Skinner, Stone, Wagner, Waldron, Weber, Wieckowski, Wilk,
Williams, Yamada, Atkins
NO VOTE RECORDED: Patterson, Quirk-Silva, Ting, Vacancy
JG:dk 8/16/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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