BILL ANALYSIS                                                                                                                                                                                                    ”



                                                                       AB 645


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          ASSEMBLY THIRD READING


          AB  
          645 (Williams and Rendon)


          As Introduced  February 24, 2015


          Majority vote


           ------------------------------------------------------------------- 
          |Committee       |Votes |Ayes                 |Noes                 |
          |                |      |                     |                     |
          |                |      |                     |                     |
          |----------------+------+---------------------+---------------------|
          |Utilities       |10-5  |Rendon, Bonilla,     |Patterson,           |
          |                |      |Burke, Eggman,       |Achadjian, Dahle,    |
          |                |      |Cristina Garcia,     |Hadley, Jones        |
          |                |      |Roger HernŠndez,     |                     |
          |                |      |Quirk, Santiago,     |                     |
          |                |      |Ting, Williams       |                     |
          |                |      |                     |                     |
          |----------------+------+---------------------+---------------------|
          |Natural         |6-3   |Williams, Cristina   |Dahle, Hadley,       |
          |Resources       |      |Garcia, McCarty,     |Harper               |
          |                |      |Rendon,              |                     |
          |                |      |                     |                     |
          |                |      |                     |                     |
          |                |      |Mark Stone, Wood     |                     |
          |                |      |                     |                     |
          |----------------+------+---------------------+---------------------|
          |Appropriations  |12-5  |Gomez, Bonta,        |Bigelow, Chang,      |
          |                |      |Calderon, Daly,      |Gallagher, Jones,    |
          |                |      |Eggman,              |Wagner               |
          |                |      |                     |                     |
          |                |      |                     |                     |








                                                                       AB 645


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          |                |      |Eduardo Garcia,      |                     |
          |                |      |Gordon, Holden,      |                     |
          |                |      |Quirk, Rendon,       |                     |
          |                |      |Weber, Wood          |                     |
          |                |      |                     |                     |
          |                |      |                     |                     |
           ------------------------------------------------------------------- 


          SUMMARY:  Establishes a Renewables Portfolio Standard (RPS) target  
          of 50% by 2030, including interim targets of 38% by 2023 and 44%  
          by 2026.


          FISCAL EFFECT:  According the Assembly Appropriations Committee:


          1)Annual California Public Utility Commission (CPUC) costs of $1.5  
            million per year over five years, beginning in 2017 to continue  
            consultant contracts.  Increased ongoing annual staffing costs  
            of $125,000.


          2)Ongoing annual California Energy Commission (CEC) costs of  
            $870,000 to develop regulations and data necessary to implement  
            and track the higher procurement standard.


          COMMENTS:


          1)Background.  The California RPS program requires investor-owned  
            utilities, local publicly-owned utilities, and energy service  
            providers to increase purchases of renewable energy to at least  
            33% of retail sales by December 31, 2020.


            The original RPS bill, SB 1078 (Sher), Chapter 516, Statutes of  
            2002, set a goal of 20% by 2017.  SB 107 (Simitian), Chapter  








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            464, Statutes of 2006, accelerated the deadline for 20% to 2010.  
             


            SB2 X1 (Simitian), Chapter 1, Statutes of 2011-12 First  
            Extraordinary Session, codified the current 33% 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.


          2)Governor's objectives for 2030 and beyond.  In his January 5,  
            2015, Inaugural Address, Governor Brown announced the following  
            three objectives to be accomplished within the next 15 years:


             a)   Increase the RPS from 33% to 50%,


             b)   Reduce petroleum use in transportation fuels by up to 50%,  
               and


             c)   Double the efficiency of existing buildings and make  
               heating fuels cleaner.


            This bill addresses the Governor's first policy goal by  
            increasing the RPS from 33% to 50% by 2030.


          1)Work in Progress.  Many outstanding policy and implementation  
            issues remain and will need to be addressed prior to enacting  
            any legislation to increase the RPS to 50% by 2030.  These  
            include:










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             1)   Enabling the procurement and integration of the broad  
               range of renewable resources necessary to assure balanced,  
               reliable portfolios, and maximize environmental benefits,


             2)   Determining the manner in which electricity from  
               small-scale and distributed renewable energy resources is  
               counted toward the RPS to assure these resources are properly  
               valued, but not double-counted, and


             3)   Reconciling the RPS with other programs that are part of  
               the state's overall climate and energy goals, such as energy  
               efficiency and electrification of the transportation sector.




          Analysis Prepared by:                                               
                          Sue Kateley / U. & C. / (916) 319-2083  FN:  
          0000696