BILL ANALYSIS Ó
AB 1110
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB
1110 (Ting)
As Amended August 19, 2016
Majority vote
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|ASSEMBLY: | |(May 11, 2015) |SENATE: |26-12 |(August 23, |
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(vote not relevant)
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|COMMITTEE VOTE: | | (August 30, |RECOMMENDATION: |concur |
| |11-3 |2016) | | |
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(U. & C.)
Original Committee Reference: Rev. & Tax.
SUMMARY: Modifies current requirements to report sources of
electricity by every retail supplier of electricity in
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California to also annually report to its customers the
greenhouse gases (GHG) emissions intensity of the supplier's
electricity sources.
The Senate amendments delete the previous content of the bill
and replace it with the following:
1)Require the California Energy Commission (CEC), on or before
January 1, 2018, to adopt guidelines for the reporting and
disclosure of greenhouse gas emissions intensity and requires
retail supplies to begin to report GHG data beginning January
1, 2020.
2)Require the CEC to calculate GHG intensity for total
California electricity sales and to adopt guidelines for
reporting and disclosing GHG emissions associated with retail
electricity sales;
3)Allow publicly-owned utilities (POUs) to include, in its
annual disclosures, GHG-free generation from prior years as
authorized by the CEC.
4)Make conforming changes to definitions in existing law
relating to disclosure requirements.
5)Provide a Community Choice Aggregator (CCA) formed after
January 1, 2016, up to three years to comply with the GHG
reporting requirements.
6)Require retail suppliers, beginning June 1, 2020, to report
data on GHG emissions intensity associated with retail sales
occurring after December 31, 2018, except as provided.
EXISTING LAW:
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1)Requires entities offering electric services in California
disclose accurate, reliable, and simple to understand
information on the sources of energy that are used to provide
electric service. (Public Utilities Code Section 398.1)
2)Defines the terms "specific purchases" and "unspecified
sources of power." (Public Utilities Code Section 398.2)
3)Specifies requirements for an annual disclosure of sources of
electricity associated with electricity sales by retail
suppliers of electricity. (Public Utilities Code Section
398.4)
4)Requires retail sellers of electricity to report sales and its
annual disclosure of sources of electricity to the CEC and
requires the CEC to specify guidelines and standard formats
for disclosures. (Public Utilities Code Section 398.5)
5)Requires retail sellers of electricity - investor-owned
utilities (IOUs), CCAs, and energy service providers (ESPs) -
and POUs to increase purchases of renewable energy such that
at least 50% of retail sales are procured from renewable
energy resources by December 31, 2030. This is known as the
Renewable Portfolio Standard (RPS). (Public Utilities Code
Section 399.11 et seq.)
6)Requires all renewable electricity products counting toward
RPS requirements to from one of three product categories (or
"buckets") and specifies maximum allowed quantities: a)
renewable resources directly connected to a California
balancing authority or provided in real time without
substitution from another energy source; b) energy not
connected or delivered in real time yet still delivering
electricity; and c) unbundled renewable energy credits (RECs).
(Public Utilities Code Section 399.16.)
7)Requires the reduction of statewide emissions of GHGs to 1990
levels by 2020. This is known as the Global Warming Solutions
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Act of 2006. (Health and Safety Code Section 38500 et seq.)
FISCAL EFFECT: Unknown.
COMMENTS:
1)Background: Suppliers of electricity must disclose power
sources. Existing statute requires retail suppliers - IOUs,
POUs, CCAs, and ESPs - to disclose fuel source information to
potential end-use customers in a way that is accurate,
reliable, and simple to understand. The disclosure is
governed by the CEC's Power Source Disclosure Program, by
which the CEC specifies a standard format the retail suppliers
are to use. That format is known as the Power Content Label.
The Power Content Label presents retail supplier fuel source
information in two broad categories: a) specific purchases
and b) unspecified sources of power. The label breaks out the
first category, specific purchases, into several
subcategories: eligible renewables (meaning eligible for RPS
credit), coal, large hydroelectric, natural gas, nuclear, and
other. The label provides no additional detail to the second
category, unspecified sources of power, because such
electricity, by definition, is not traceable to a specific
generation source. In addition, the label presents comparison
data on the power mix for all retail electricity deliveries in
California.
The Power Content Label is not without controversy. Some
parties contend the bill potentially confuses customers,
despite the statutory direction that the label is to be
accurate, reliable, and simple to understand. For example,
some parties have complained that the reporting periods and
reporting specifications required of retail suppliers of
electricity differ from the reporting periods and reporting
specifications of other state programs. Others contend the
label misleads customers on the supplier's progress in meeting
the RPS.
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Still others contend that the Power Content Label, first
created nearly two decades ago, needs updating to reflect the
state's current environmental policies and priorities.
Specifically, bill proponents argue the current Power Content
Label does not currently include information on GHG intensity
associated with the sellers' sources of electricity. This
bill would add a GHG emissions intensity factor to the statute
requiring power source disclosure.
2)Rollover Credits? This bill establishes a new provision in
the disclosure rules that would allow a POU to "rollover" GHG
credits from prior years and use them in a current year. This
bill requires the CEC to establish guidelines for these
adjustments that demonstrate generation of quantities of
electricity in previous years in excess of total retail and
wholesale sales.
This specific provision allows the carryover of excess zero
GHG electricity "generation" in a manner that limits
applicability only if certain conditions are met,
specifically, the POU must generate electricity, with its own
utility-owned facilities, more zero GHG electricity than is
needed to satisfy its entire retail sales. A POU that
procures electricity from a third-party could not meet the
conditions to quality to use rollover GHG credits from prior
years. At this time, the only POU that appears to qualify for
this provision is San Francisco.
The same provision references the ability to adjust the GHG
emissions intensity factor for one year based on "previous
years." There is no definition of what is meant by "previous
years." This is open to interpretation by the CEC, therefore
the committee may want to recommend that the CEC limit the
historic period available for carryover to no earlier than the
date of enactment of this bill. Further, the committee may
want to recommend disclosure whenever GHG emission factors are
included from previous years.
This provision also permits the carryover of zero GHG value if
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the excess power is sold into the market as an "unspecified
source." If the zero GHG value of this power is being applied
to a future year, the CEC should consider adjusting the GHG
emissions intensity of "system power" to ensure that the zero
GHG quality of such sales is not included in the calculation
of the "system power" intensity factor.
3)Prior/Related Legislation:
SB 1305 (Sher), Chapter 796, Statutes of 1997: First required
retail suppliers to disclose their power sources.
AB 162 (Ruskin), Chapter 313, Statutes of 2009: Modifies and
streamlines power source disclosure reporting requirements for
POUs and other electricity providers.
SB 456 (Padilla) of 2013-14: Would have added two categories
of fuel source information to the Power Content Label: energy
storage and out-of-state generation. Died in the Assembly
Utilities and Commerce Committee.
Analysis Prepared by:
Sue Kateley / U. & C. / (916) 319-2083 FN:
0004994