BILL ANALYSIS Ó
AB 197
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Date of Hearing: April 27, 2015
ASSEMBLY COMMITTEE ON NATURAL RESOURCES
Das Williams, Chair
AB 197
(Eduardo Garcia) - As Amended March 26, 2015
SUBJECT: Public utilities: renewable resources
SUMMARY: Revises the Renewables Portfolio Standard (RPS)
procurement process to emphasize greenhouse gas (GHG) emissions
and reliability factors.
EXISTING LAW:
1)The RPS requires retail sellers [including IOUs, energy
service providers (ESPs) and community choice aggregators
(CCAs)], as well as publicly-owned utilities (POUs), to
procure eligible renewable energy resources to meet the
following portfolio targets:
a) 20 percent on average from January 1, 2011 to December
31, 2013.
b) 25 percent by December 31, 2016.
c) 33 percent by December 31, 2020 and each year
thereafter.
2)Provides that eligible renewable generation facilities must
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use biomass, solar thermal, photovoltaic, wind, geothermal,
renewable fuel cells, small hydroelectric, digester gas,
limited non-combustion municipal solid waste conversion,
landfill gas, ocean wave, ocean thermal or tidal current.
3)Requires the Public Utilities Commission (PUC) to establish a
cost limit for each IOU according to specified criteria,
requires the PUC to report to the Legislature by 2016
regarding whether IOUs can achieve 33 percent within the
adopted cost limit, authorizes the PUC to revise the cost
limit once after 2016 if necessary, and authorizes IOUs to
stop procuring renewable energy beyond the cost limit, unless
additional renewable energy can be procured without exceeding
a de minimis increase in rates.
THIS BILL:
1)Requires the PUC's RPS procurement process take into account,
and IOU and POU procurement plans to consider:
a) The statewide GHG emission limit established
pursuant to AB 32.
b) Capacity and essential reliability services of the
eligible renewable energy resource to ensure grid
reliability.
2)Requires each IOU, in soliciting and procuring eligible
renewable energy resources, to consider the "best-fit"
attributes of resource types that ensure a balanced resource
mix to maintain the reliability of the grid.
FISCAL EFFECT: Unknown
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COMMENTS:
1)Background. The RPS is the centerpiece of California's effort
to develop a clean energy system and reduce pollution and
greenhouse gas emissions associated with electricity
consumption. The original RPS bill, SB 1078 (Sher), Chapter
516, Statutes of 2002, set a goal of 20 percent by 2017. SB
107 (Simitian), Chapter 464, Statutes of 2006, accelerated the
deadline for 20 percent to 2010. SBX1 2 (Simitian), Chapter
1, Statutes of 2011-12 First Extraordinary Session, codified
the current 33 percent by 2020 RPS target and also established
product content categories (or "buckets"), which place the
highest value (Bucket 1) on renewable energy that is directly
delivered into California because it has the greatest
economic, environmental and reliability benefits.
Since the RPS was enacted, IOUs have advanced beyond their
2002 average starting point of 12% renewables. According to
the PUC's RPS reports, IOUs' actual RPS procurement in 2013
was 23.8% for Pacific Gas and Electric (PG&E), 21.6% for
Southern California Edison (SCE), and 23.6% for San Diego Gas
& Electric (SDG&E). The PUC reports also show that the IOUs
are on track to meet the RPS requirement of 25% renewables by
2016 and are well-positioned to meet the 33% requirement by
2020. RPS procurement currently under contract for 2020 is
31.3% for PG&E, 23.5% for SCE, and 38.8% for SDG&E.
2)Governor's goals. In his January 5, 2015 Inaugural Address,
Governor Brown announced the following "objectives for 2030
and beyond":
Toward that end, I propose three ambitious goals to be
accomplished within the next 15 years:
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Increase from one-third to 50 percent our
electricity derived from renewable sources;
Reduce today's petroleum use in cars and
trucks by up to 50 percent;
Double the efficiency of existing buildings
and make heating fuels cleaner.
We must also reduce the relentless release of methane,
black carbon and other potent pollutants across industries.
And we must manage farm and rangelands, forests and
wetlands so they can store carbon. All of this is a very
tall order. It means that we continue to transform our
electrical grid, our transportation system and even our
communities.
I envision a wide range of initiatives: more distributed
power, expanded rooftop solar, micro-grids, an energy
imbalance market, battery storage, the full integration of
information technology and electrical distribution and
millions of electric and low-carbon vehicles. How we
achieve these goals and at what pace will take great
thought and imagination mixed with pragmatic caution. It
will require enormous innovation, research and investment.
And we will need active collaboration at every stage with
our scientists, engineers, entrepreneurs, businesses and
officials at all levels.
Taking significant amounts of carbon out of our economy
without harming its vibrancy is exactly the sort of
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challenge at which California excels. This is exciting, it
is bold and it is absolutely necessary if we are to have
any chance of stopping potentially catastrophic changes to
our climate system.
1)Author's statement:
Currently, state law only requires a total cost basis for
ranking and selecting least-cost and best-fit eligible
renewable energy resources. As California moves toward a
cleaner, low-carbon electrical grid, procurement planning
process should also take into consideration "best-fit" in
addition to total cost to ensure that any available
renewable energy resources with attributes that provide
grid reliability, and reduce GHG emissions, are taken into
account.
REGISTERED SUPPORT / OPPOSITION:
Support
Clean Power Campaign
Opposition
None on file
AB 197
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Analysis Prepared by:Lawrence Lingbloom / NAT. RES. / (916)
319-2092