BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     AB 802


                                                                    Page  1


          (Without Reference to File)





          CONCURRENCE IN SENATE AMENDMENTS


          AB  
          802 (Williams)


          As Amended  September 10, 2015


          Majority vote


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                                               (vote not available)




          Original Committee Reference:  U. & C.


          SUMMARY:  Requires the California Public Utilities Commission  
          (CPUC) to authorize electrical corporations or gas corporations  
          - investor-owned utilities (IOUs) - to provide incentives and  
          assistance for measures to conform a building to California  
          Energy Commission's (CEC) energy efficiency standards for  
          existing buildings and to allow IOUs to recover in rates the  
          reasonable costs of those incentives and assistance.










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          The Senate amendments:


          1)Requires the CEC to make adjustments to its energy demand  
            forecasts.
          2)Requires the CEC to use its assessments and forecasts relating  
            to various aspects of the energy industry to develop and  
            evaluate energy policies and programs.


          3)Requires utilities to maintain records of the energy usage  
            data of all buildings to which they provide service for at  
            least the most recent 12 complete months, and require each  
            utility, upon the request and the written authorization or  
            secure electronic authorization of the owner, owner's agent,  
            or operator of a covered buildings, to deliver or provide  
            aggregated energy usage data for a covered building to the  
            owner, owner's agent, operator, or to the owner's account in  
            the ENERGY STAR Portfolio Manager, as specified.


          4)Authorizes the CEC to specify additional information to be  
            delivered by utilities for certain purposes. 


          5)Deletes the requirement that an owner or operator of a  
            building disclose the energy performance information to a  
            prospective buyer, lessee of the entire building, or lender  
            that would finance the entire building. 


          6)Requires CEC to adopt regulations providing for the delivery  
            to the Commission and public disclosure of benchmarking  
            results for covered buildings. 


          7)The bill would authorize the CEC to impose a civil fine, as  
            provided, for a violation of these data submission  
            requirements.


          8)Make technical clarifying amendments.  








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          EXISTING LAW: 



          1)Requires a charge on electricity and natural gas consumption  
            to fund cost-effective energy efficiency and conservation  
            activities.  (Public Utilities Code Sections 381 and 890)


          9)Requires electric corporation procurement plans 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  
            Sections 454.5 (b)(9)(C)) 


          10)Requires the CPUC to establish targets for all potentially  
            achievable cost-effective electricity and gas efficiency  
            savings.  (Public Utilities Code Sections 454.55 and 454.56)


          11)Requires the CEC to develop a statewide estimate of all  
            potentially achievable cost-effective electricity and natural  
            gas savings, establish targets for statewide annual energy  
            efficiency savings, and demand reduction for the next 10-year  
            period.  (Public Resources Code Section 25310)


          12)Requires the CEC to adopt cost-effective energy and water  
            efficiency standards for new buildings and appliances.   
            (Public Resources Code Section 25402)


          13)Prohibits the sale of new appliances that do not meet the  








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            energy and water efficiency standards adopted by the CEC.   
            (Public Resources Code Section 25402(c)(2))


          14)Requires an owner or operator of a nonresidential building to  
            disclose the United States Environmental Protection Agency's  
            ENERGY STAR Portfolio Manager benchmarking data and ratings  
            for the most recent 12-month period to a prospective buyer,  
            lessee of the entire building, or lender that would finance  
            the entire building based on a schedule developed by the CEC.   
            (Public Resources Code Section 25402.10(d))


          15)Requires the CEC to develop and implement a comprehensive  
            program to achieve greater energy savings in California's  
            existing residential and nonresidential building stock.   
            (Public Resources Code Section 25943)


          FISCAL EFFECT:  According to Senate Appropriations Committee:


          1)Ongoing costs of $1.7 million to the Energy Resources Program  
            Account (General Fund) for additional workload and contracts  
            to implement the new benchmarking program and to incorporate  
            additional energy efficiency information into the CEC's  
            assessments and forecasts.


          2)Unknown costs, but at least $900,000 to the Public Utilities  
            Reimbursement Account (special) for additional staff at the  
            CPUC to oversee, evaluate, and review the energy efficiency  
            program, and to provide an expedited authorization of high  
            opportunity projects.


          3)Unknown costs, but potentially in the millions of dollars to  
            the General Fund and various special funds to the state as a  
            ratepayer of IOUs for additional energy efficiency program  
            costs.










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          COMMENTS:


          1)Background.  Existing law requires that the state's energy  
            needs first be met by increasing energy efficiency under the  
            "loading order."  Consistent with the loading order, existing  
            law requires electric and gas IOUs to meet unmet resources  
            with all available energy efficiency and demand reduction that  
            is cost effective, reliable, and feasible.  To achieve these  
            targets, the IOUs administer energy efficiency programs with  
            ratepayer funds approved by the CPUC.  Currently ratepayers  
            pay approximately $1 billion for financial incentives, loans,  
            and rebates for installing energy efficient appliances,  
            lighting, windows, HVAC systems, whole-house retrofits, and  
            sector-specific efforts.


          2)Below-code buildings not eligible.  Under the CPUC's existing  
            rules, the IOUs energy savings is calculated against a  
            baseline, which is based on a) "natural occurring savings," b)  
            standard industry practice, and c) Title 24 energy efficiency  
            standards for existing buildings. Thus, when the energy  
            efficiency project involves an existing building, only those  
            savings above the baseline are eligible for incentives and  
            assistance.


          3)Minimum efficiency standards continue to tighten.  Title 24 of  
            the California Code of Regulations establishes building  
            standards for energy efficiency.  They were first adopted in  
            1978, and are currently updated approximately every three  
            years.  The standards are developed by the CEC, and are  
            applied when a building permit is issued.


          4)Energy Forecasts.  Following a hearing in January 2013, before  








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            the Senate Energy, Utilities, and Commerce Committee, the  
            CPUC, CEC, and the California Independent System Operator  
            (CAISO) committed to aligning their respective processes to  
            coordinate energy efficiency so that there is proper  
            accounting; align the key milestones of the demand forecasting  
            process, including projections for energy efficiency; CEC  
            modifying its existing models to support forecasting at more  
            granular geographic levels in response to the needs of the  
            CPUC and CAISO; and developing new modeling methods to more  
            robustly capture efficiency impacts.  Customer-specific energy  
            data could improve the accuracy of those forecasts.


            In response to concerns regarding the privacy of energy data,  
            the author submitted a letter to the Senate Journal stating  
            that AB 802 does not require small residential property owners  
            of buildings with 16 or fewer residential utility accounts to  
            collect or deliver energy usage or building characteristic  
            information to the CEC.  Rather, the bill gives owners of  
            buildings the right to receive such information.


          Analysis Prepared by:                                             
                          Sue Kateley / U. & C. / (916) 319-2083  FN:  
          0002439