BILL ANALYSIS Ó
AB 802
Page 1
Date of Hearing: May 6, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
AB
802 (Williams) - As Amended May 1, 2015
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Urgency: No State Mandated Local Program: NoReimbursable: No
SUMMARY:
This bill requires the Public Utilities Commission (PUC) to
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authorize electrical or gas corporations to recover the
reasonable costs of energy efficiency programs in their rates.
Specifically, this bill:
1)Requires the PUC to authorize the inclusion of reasonable
costs for energy efficiency incentive or rebate programs for
existing buildings in a separate or existing proceeding by
July 1, 2016.
2)Requires the PUC to authorize electrical and gas corporations
to count all energy savings achieved toward overall energy
efficiency goals or targets established by the PUC.
3)Authorizes the PUC to adjust the energy efficiency goals and
targets of electrical and gas corporations to reflect the
energy savings achieved in meeting or exceeding energy
efficiency requirements in existing buildings.
FISCAL EFFECT:
1)Increased annual costs to the PUC (special fund) in the range
of $1.4 million to $2.8 million for staffing to provide
oversight, evaluation and the review of energy efficiency
programs.
This bill may result in a substantial shift in the way the PUC
calculates energy efficiency savings and may require staff to
alter documents, databases, and studies including the Energy
Efficiency Policy Manual, the California Energy Efficiency
Evaluation Protocols, the Database for Energy Efficiency
Resources, and the Potential & Goals study.
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2)Potential increased customer rates offset by potential energy
reductions.
The CPUC establishes the budgets for the ratepayer funded
incentive programs. This bill does not require an increase in
those budgets, thus a rate increase is not guaranteed.
Instead, the PUC could incorporate the provisions of this bill
into the existing program portfolio and reduce or de-fund less
productive programs.
COMMENTS:
1)Purpose. According to the author, current policy leads to a
large pool of stranded energy efficiency savings potential
because program administrators can only target energy savings
attributable to the installation of equipment above current
code levels. This bill will allow electrical and gas
corporations to provide incentives for any improvements and
count all savings that show up at the meter as decreased use,
including savings achieved by process changes and maintenance.
1)Background. Two recently completed studies in the PG&E
service area found that the savings potential for bringing a
building to current code standards are higher than the
potential savings from above-code only programs. One study
found that as much as 75% of potential savings were stranded
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under current policies. The second study found similar
results: 71% of the total potential electric savings, equating
to 781 gigawatt hours (GWh), were below-code, while the
remainder was above-code.
Under the current code baseline rules, in most cases, investor
owned utilities (IOUs) can only offer an incentive for the
portion of savings that occurs from code to super-efficient.
Pacific Gas & Electric (PG&E) found that this is particularly
challenging for schools receiving funding under Proposition
39, which also adopts the above-code approach to funding
energy efficiency improvements at schools:
PG&E found through a 2006 survey of existing site conditions
at 19 schools; two of the 19 schools are more efficient than
code, while the remainder range from slightly less efficient
to significantly less efficient. The survey also found
least efficient schools are poor candidates for investor owned
utility programs because the majority of the savings potential
cannot be counted or receive incentives, leaving these schools
with a significant investment of their own before they could
benefit from incentive assistance.
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Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081