BILL ANALYSIS Ó AB 793 Page 1 CONCURRENCE IN SENATE AMENDMENTS AB 793 (Quirk) As Amended August 31, 2015 Majority vote -------------------------------------------------------------------- |ASSEMBLY: | 77-0 | (May 7, 2015) |SENATE: |38-0 | (September 2, | | | | | | |2015) | | | | | | | | | | | | | | | -------------------------------------------------------------------- Original Committee Reference: U. & C. SUMMARY: This bill requires electrical corporations to develop and implement educational plans and incentive programs for customers to control their electricity use and acquire energy management technology. Specifically, this bill: 1)Requires the California Public Utilities Commission (CPUC) to require electrical corporations to: a) Develop an incentive program by June 30, 2016, for customers to acquire energy management technology for use in their homes or businesses. Incentives must be established at a level necessary to encourage adoption of technologies that allow a customer to achieve progressively higher savings. AB 793 Page 2 b) Develop and implement a plan by June 30, 2016, to educate customers to better understand and control their electricity use and notify them of the incentive program. c) Annually report on actual customer savings resulting from the education plan and incentive program. 1)Requires the CPUC to require electrical and gas corporations to include home energy management technology in weatherization programs for low-income customers. 2)Defines home energy management technology as a product, service, or software that allows a customer to better understand and manage energy use in the customer's home or place of business, as appropriate. The Senate amendments: 1)Revises the definition of an energy management technology from "is" to "may include" product, service, or software that allows a customer to better understand and manage energy use in the customer's home. 2)Modifies language directing the CPUC to direct investor owned utilities (IOUs) to implement a program to help customers understand how to use energy management technologies and instead direct the CPUC to direct an energy efficiency program administrator to implement this program. 3)Modifies the program start date from June 30, 2016, to January 1, 2017, and modifies the education program start date from June 30, 2016, to September 30, 2017. 4)Relocates the provisions of this bill related to the programs AB 793 Page 3 from Public Utilities Code Section 8365 to Public Utilities Code Section 717. 5)Make non-substantive editorial changes. EXISTING LAW: 1)Requires electrical corporations to first meet its unmet resource needs through all available energy efficiency and demand reduction resources that are cost effective, reliable, and feasible. (Public Utilities Code Section 454.5 (b)(9)(C) 2)Requires the CPUC to establish energy efficiency targets for electrical and gas corporations. (Public Utilities Code Section 454.55 and 454.56) 3)Requires electric and gas corporations to provide weatherization assistance, and specifies that weatherization means attic insulation, caulking, weather-stripping, a low flow showerhead, water heater blanket, and door and building envelope repairs to reduce air infiltration for low-income customers. (Public Utilities Code Section 2790 (a), (b)) 4)Specifies that weatherization may also include other building conservation measures, energy-efficient appliances, and energy education programs determined by the Commission to be feasible and considering the cost effectiveness of the measures as a whole and the policy of reducing energy-related hardships facing low-income households. (Public Utilities Code Section 2790 (c)) FISCAL EFFECT: Minor, absorbable costs for the CPUC to oversee electrical and gas corporation's energy efficiency rebates and marketing/outreach programs, and analyze and evaluate new weatherization measures. AB 793 Page 4 COMMENTS: 1)Purpose. According to the author, this bill will help to increase the deployment of energy management technologies which will provide customers with a better understanding of their energy usage so that they may make informed decisions about how to optimize their energy consumption and reduce their energy bills. The author states, "While millions of smart meters have been installed throughout California, the deployment and use of energy management technologies has not kept pace. This bill will incentivize the adoption of these technologies by requiring the IOUs to implement an outreach plan to educate their residential and small business customers." 2)Background. Electrical corporations are IOUs regulated by the CPUC. Electrical corporations are required to meet unmet resource needs by first employing all available energy efficiency and demand reduction strategies that are cost-effective, reliable and feasible. The CPUC establishes energy efficiency targets for electrical and gas corporations. SB 17 (Padilla), Chapter 327, Statutes of 2009, established the smart grid policy of the state, and required the CPUC to determine the requirements for a smart grid deployment plan and each electrical corporation to develop and submit a smart grid deployment plan to CPUC for approval by July 1, 2011. The term smart grid refers to a distribution system that allows for the flow of information from a customer's meter in two directions, and modernizes the electric distribution and transmission grid. In order for a customer to take full advantage of their smart meter's capabilities, the customer must acquire energy management technologies so they may monitor their energy consumption in real time and respond to local control signals. AB 793 Page 5 3)Weatherization. Electric and gas corporations are required to provide weatherization assistance for low-income customers. Weatherization typically means attic insulation, caulking, weather-stripping, etc. Weatherization also may include other building conservation measures, energy-efficient appliances, and energy education programs. This bill expressly includes home energy management technology as part of weatherization incentive and assistance programs. 4)Program administration. The CPUC supervises the administration of energy efficiency programs administered by IOUs. Recently the CPUC allowed community choice aggregators and regional energy networks to also administer these programs. As with the IOU-administered programs, the CPUC is evaluating the cost-effectiveness of administering programs through community choice aggregators and regional energy networks through ongoing evaluations. Analysis Prepared by: Sue Kateley / U. & C. / (916) 319-2083 FN: 0002014