Amended in Senate May 28, 2013

Amended in Senate April 10, 2013

Senate BillNo. 591


Introduced by Senator Cannella

(Coauthor: Assembly Member Gray)

February 22, 2013


An act to amend Section 399.30begin delete of, and to add and repeal Section 399.30.5 of,end deletebegin insert ofend insert the Public Utilities Code, relating to renewable energybegin insert resourcesend insert.

LEGISLATIVE COUNSEL’S DIGEST

SB 591, as amended, Cannella. Renewable energybegin insert resourcesend insert:begin insert localend insert publicly owned electric utility: hydroelectric generation facilitybegin delete and enforcementend delete.

The California Renewables Portfolio Standard Programbegin delete (RPS program)end deletebegin insert, referred to as the RPS program,end insert 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 from 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 specifiedbegin delete (portfolio content requirements)end deletebegin insert, referred to as the portfolio content requirementsend insert.begin delete Existing law requires the State Energy Resources Conservation and Development Commission to adopt regulations specifying procedures for enforcement of the above requirements for local publicly owned electric utilities.end delete

This bill wouldbegin delete require a local publicly owned electric utility that receives greater than 50% of its electricity sources from hydroelectric generation meeting specified requirements to procure eligible renewable energy resources, including renewable energy credits, to meet only the electricity demands unsatisfied by its hydroelectric generation in any given year to satisfy its portfolio content requirements. The bill would require the commission, by July 1, 2014, to report to the Legislature on whether the regulations specifying procedures for enforcement result in surplus electricity sales and under what circumstances surplus electricity sales have occurred or may occur.end deletebegin insert provide that a local publicly owned electric utility is not required to procure additional eligible renewable energy resources in excess of specified levels, if it receives 50% or greater of its annual retail sales from its own hydrodelectric generation meeting specified requirements.end insert

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

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

P2    1

SECTION 1.  

Section 399.30 of the Public Utilities Code is
2amended to read:

3

399.30.  

(a) To fulfill unmet long-term generation resource
4needs, each local publicly owned electric utility shall adopt and
5implement a renewable energy resources procurement plan that
6requires the utility to procure a minimum quantity of electricity
7products from eligible renewable energy resources, including
8renewable energy credits, as a specified percentage of total
9kilowatthours sold to the utility’s retail end-use customers, each
10compliance period, to achieve the targets of subdivision (c).

11(b) The governing board shall implement procurement targets
12for a local publicly owned electric utility that require the utility to
13procure a minimum quantity of eligible renewable energy resources
14for each of the following compliance periods:

15(1) January 1, 2011, to December 31, 2013, inclusive.

16(2) January 1, 2014, to December 31, 2016, inclusive.

17(3) January 1, 2017, to December 31, 2020, inclusive.

P3    1(c) The governing board of a local publicly owned electric utility
2shall ensure all of the following:

3(1) The quantities of eligible renewable energy resources to be
4procured for the compliance period from January 1, 2011, to
5December 31, 2013, inclusive, are equal to an average of 20 percent
6of retail sales.

7(2) The quantities of eligible renewable energy resources to be
8procured for all other compliance periods reflect reasonable
9progress in each of the intervening years sufficient to ensure that
10the procurement of electricity products from eligible renewable
11energy resources achieves 25 percent of retail sales by December
1231, 2016, and 33 percent of retail sales by December 31, 2020.
13The local governing board shall require the local publicly owned
14electric utilities to procure not less than 33 percent of retail sales
15of electricity products from eligible renewable energy resources
16in all subsequent years.

17(3) A local publicly owned electric utility shall adopt
18procurement requirements consistent with Section 399.16.

19(d) The governing board of a local publicly owned electric utility
20may adopt the following measures:

21(1) Rules permitting the utility to apply excess procurement in
22one compliance period to subsequent compliance periods in the
23same manner as allowed for retail sellers pursuant to Section
24399.13.

25(2) Conditions that allow for delaying timely compliance
26consistent with subdivision (b) of Section 399.15.

27(3) Cost limitations for procurement expenditures consistent
28with subdivision (c) of Section 399.15.

29(e) The governing board of the local publicly owned electric
30utility shall adopt a program for the enforcement of this article on
31or before January 1, 2012. The program shall be adopted at a
32publicly noticed meeting offering all interested parties an
33opportunity to comment. Not less than 30 days’ notice shall be
34given to the public of any meeting held for purposes of adopting
35the program. Not less than 10 days’ notice shall be given to the
36public before any meeting is held to make a substantive change to
37the program.

38(f) (1) Each local publicly owned electric utility shall annually
39post notice, in accordance with Chapter 9 (commencing with
40Section 54950) of Part 1 of Division 2 of Title 5 of the Government
P4    1Code, whenever its governing body will deliberate in public on its
2renewable energy resources procurement plan.

3(2) Contemporaneous with the posting of the notice of a public
4meeting to consider the renewable energy resources procurement
5plan, the local publicly owned electric utility shall notify the
6Energy Commission of the date, time, and location of the meeting
7in order to enable the Energy Commission to post the information
8on its Internet Web site. This requirement is satisfied if the local
9publicly owned electric utility provides the uniform resource
10 locator (URL) that links to this information.

11(3) Upon distribution to its governing body of information
12related to its renewable energy resources procurement status and
13future plans, for its consideration at a noticed public meeting, the
14local publicly owned electric utility shall make that information
15available to the public and shall provide the Energy Commission
16with an electronic copy of the documents for posting on the Energy
17Commission’s Internet Web site. This requirement is satisfied if
18the local publicly owned electric utility provides the uniform
19resource locator (URL) that links to the documents or information
20regarding other manners of access to the documents.

21(g) A public utility district that receives all of its electricity
22pursuant to a preference right adopted and authorized by the United
23States Congress pursuant to Section 4 of the Trinity River Division
24Act of August 12, 1955 (Public Law 84-386) shall be in compliance
25with the renewable energy procurement requirements of this article.

26(h) For a local publicly owned electric utility that was in
27existence on or before January 1, 2009, that provides retail electric
28service to 15,000 or fewer customer accounts in California, and is
29interconnected to a balancing authority located outside this state
30but within the WECC, an eligible renewable energy resource
31includes a facility that is located outside California that is
32connected to the WECC transmission system, if all of the following
33conditions are met:

34(1) The electricity generated by the facility is procured by the
35local publicly owned electric utility, is delivered to the balancing
36authority area in which the local publicly owned electric utility is
37located, and is not used to fulfill renewable energy procurement
38requirements of other states.

P5    1(2) The local publicly owned electric utility participates in, and
2complies with, the accounting system administered by the Energy
3Commission pursuant to this article.

4(3) The Energy Commission verifies that the electricity
5generated by the facility is eligible to meet the renewables portfolio
6standard procurement requirements.

7(i) Notwithstanding subdivision (a), for a local publicly owned
8electric utility that is a joint powers authority of districts established
9pursuant to state law on or before January 1, 2005, that furnish
10electric services other than to residential customers, and is formed
11pursuant to the Irrigation District Law (Division 11 (commencing
12with Section 20500) of the Water Code), the percentage of total
13kilowatthours sold to the district’s retail end-use customers, upon
14which the renewables portfolio standard procurement requirements
15in subdivision (b) are calculated, shall be based on the authority’s
16average retail sales over the previous seven years. If the authority
17has not furnished electric service for seven years, then the
18calculation shall be based on average retail sales over the number
19of completed years during which the authority has provided electric
20service.

21(j) A local publicly owned electric utility in a city and county
22that only receives greater than 67 percent of its electricity sources
23from hydroelectric generation located within the state that it owns
24and operates, and that does not meet the definition of a “renewable
25electrical generation facility” pursuant to Section 25741 of the
26Public Resources Code, shall be required to procure eligible
27renewable energy resources, including renewable energy credits,
28to meet only the electricity demands unsatisfied by its hydroelectric
29generation in any given year, in order to satisfy its renewable
30energy procurement requirements.

31(k) (1) A local publicly owned electric utility that receives
32greater than 50 percent of itsbegin delete electricity sources from hydroelectric
33generation that it owns and operates, and that does not meet the
34definition of a renewable electrical generation facility pursuant to
35Section 25741 of the Public Resources Code, shall be required to
36procure eligible renewable energy resources, including renewable
37energy credits, to meet only the electricity demands unsatisfied by
38its hydroelectric generation in any given year, to satisfy its
39renewable energy procurement requirements.end delete
begin insert annual retail sales
40from its own hydroelectric generation that is not an eligible
P6    1renewable energy resource shall not be required to procure
2additional eligible renewable energy resources in excess of either
3of the following:end insert

begin insert

4(A) The portion of its retail sales not supplied by its own
5hydroelectric generation.

end insert
begin insert

6(B) The cost limitation adopted pursuant to this section.

end insert

7(2) For the purposes of this subdivision, “hydroelectric
8 generation” means electricity generated from a hydroelectric
9facility that satisfies all of the following:

10(A) Is owned solely and operated by the local publicly owned
11electric utility as of 1967.

12(B) begin deleteHas end deletebegin insertServes a local publicly owned electric utility with end inserta
13distribution system demand of less than 150 megawatts.

14(C) Involves a contract in which an electrical corporation
15receives the benefit of the electric generation through June of 2014,
16at which time the benefit reverts back to the ownership and control
17of the local publicly owned electric utility.

18(D) Has a maximum penstock flow capacity of no more than
193,000 cubic feet per second and includes a regulating reservoir
20with a small hydroelectric generation facility producing fewer than
2120 megawatts with a maximum penstock flow capacity of no more
22than 2,700 cubic feet per second.

23(3) This subdivision does not reduce or eliminate any renewable
24procurement requirement for any compliance period ending prior
25to January 1, 2014.

26(l) A local publicly owned electric utility shall retain discretion
27over both of the following:

28(1) The mix of eligible renewable energy resources procured
29by the utility and those additional generation resources procured
30by the utility for purposes of ensuring resource adequacy and
31reliability.

32(2) The reasonable costs incurred by the utility for eligible
33renewable energy resources owned by the utility.

34(m) On or before July 1, 2011, the Energy Commission shall
35adopt regulations specifying procedures for enforcement of this
36article. The regulations shall include a public process under which
37the Energy Commission may issue a notice of violation and
38correction against a local publicly owned electric utility for failure
39to comply with this article, and for referral of violations to the
P7    1State Air Resources Board for penalties pursuant to subdivision
2(o).

3(n) (1) Upon a determination by the Energy Commission that
4a local publicly owned electric utility has failed to comply with
5this article, the Energy Commission shall refer the failure to comply
6with this article to the State Air Resources Board, which may
7impose penalties to enforce this article consistent with Part 6
8(commencing with Section 38580) of Division 25.5 of the Health
9and Safety Code. Any penalties imposed shall be comparable to
10those adopted by the commission for noncompliance by retail
11sellers.

12(2) If Division 25.5 (commencing with Section 38500) of the
13Health and Safety Code is suspended or repealed, the State Air
14Resources Board may take action to enforce this article on local
15publicly owned electric utilities consistent with Section 41513 of
16the Health and Safety Code, and impose penalties on a local
17publicly owned electric utility consistent with Article 3
18(commencing with Section 42400) of Chapter 4 of Part 4 of, and
19Chapter 1.5 (commencing with Section 43025) of Part 5 of,
20Division 26 of the Health and Safety Code.

21(3) For the purpose of this subdivision, this section is an
22emissions reduction measure pursuant to Section 38580 of the
23Health and Safety Code.

24(4) If the State Air Resources Board has imposed a penalty upon
25a local publicly owned electric utility for the utility’s failure to
26comply with this article, the State Air Resources Board shall not
27impose an additional penalty for the same infraction, or the same
28failure to comply, with any renewables procurement requirement
29imposed upon the utility pursuant to the California Global Warming
30Solutions Act of 2006 (Division 25.5 (commencing with Section
3138500) of the Health and Safety Code).

32(5) Any penalties collected by the State Air Resources Board
33pursuant to this article shall be deposited in the Air Pollution
34Control Fund and, upon appropriation by the Legislature, shall be
35expended for reducing emissions of air pollution or greenhouse
36gases within the same geographic area as the local publicly owned
37electric utility.

38(o) The commission has no authority or jurisdiction to enforce
39any of the requirements of this article on a local publicly owned
40electric utility.

begin deleteP8    1

SEC. 2.  

Section 399.30.5 is added to the Public Utilities Code,
2to read:

3

399.30.5.  

(a) On or before July 1, 2014, the Energy
4Commission, in consultation with the local publicly owned electric
5utilities, shall, pursuant to Section 9795 of the Government Code,
6report to the Legislature on whether regulations it has adopted
7pursuant to subdivision (m) of Section 399.30 result in surplus
8electricity sales and the circumstances under which surplus
9electricity sales have occurred or may occur.

10(b) This section shall remain in effect only until January 1, 2019,
11and as of that date is repealed, unless a later enacted statute, that
12is enacted before January 1, 2019, deletes or extends that date.

end delete


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