BILL ANALYSIS Ó AB 1150 Page 1 Date of Hearing: April 20, 2015 ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE Anthony Rendon, Chair AB 1150 (Levine) - As Introduced February 27, 2015 SUBJECT: Energy: University of California partnership SUMMARY: This bill expands the existing Energy Efficiency Partnership Program between the University of California (UC) and investor-owned utilities to include publicly owned utilities that are willing to participate in the program. Specifically, this bill: a)Requires the California Energy Commission (CEC) to expand existing partnerships to create an integrated and flexible energy efficiency program across all University of California (UC) campuses. b)Requires UC to report to the CEC the annual reduction in emissions of greenhouse gases (GHG) as a result of the expanded partnership. AB 1150 Page 2 c)Requires UC to evaluate projects based on their effect in reducing emissions of greenhouse gases and the cost effectiveness in achieving those reductions. d)Requires the California Public Utilities Commission (CPUC) and the CEC to leverage their existing partnership to allow flexibility and to accommodate the potential for multiple funding sources. EXISTING LAW: 1)Requires Publicly Owned Utilities (POUs) to encourage energy savings and greenhouse gas emission reductions in existing residential and nonresidential buildings, while taking into consideration the effect of the program on rates, reliability, and financial resources. (Public Utilities Code Section 9503) 2)Requires the CEC to adopt an integrated energy policy report which includes an overview of major energy trends and issues facing the state, and the need for resource additions, efficiency, and conservation. (Public Resources Code Sections 25228 and 25300) 3)Directs the CEC and the CPUC, each in consultation with Air Resources Board (ARB), to reevaluate and continue, modify, or replace the GHG emission performance standard, once an enforceable standard is in place, for Public Owned Utilities (POU) and load-serving entities, respectively. (Public Utilities Code Sections 8340 et seq.) FISCAL EFFECT: Unknown. AB 1150 Page 3 COMMENTS: 1)Author's Statement: The University of California has been at the forefront of our state's energy efficiency goals. Over the past ten years, UC has collectively saved 373 million kilowatt-hours per year and over 18 million therms per year through the Energy Efficiency Partnership Program. AB 1150 will build upon those achievements and help UC achieve greater energy efficiency by expanding the existing Partnership Program between investor-owned utilities to include publicly owned utilities that are willing to participate. Furthermore, this bill makes progress towards UC's commitment to becoming carbon neutral by 2025 by requiring UC to utilize a new metric of carbon reduction for the evaluation of future energy efficiency projects. 2)Success of current Energy Efficiency Partnerships: UC currently participates in a program called the Energy Efficiency Partnership with California's large investor-owned utilities (IOUs) such as Pacific Gas & Electric, Southern California Edison, and San Diego Gas and Electric. This Partnership was established in 2004 as a framework for providing energy efficiency resources for UC and CSU campuses. UC has received a total of $63.3 million in incentives from utility ratepayers as part of the program, and has saved more than 265 million kWh/year and 14.4 therms/year, substantially contributing to the State's energy efficiency goals. The program currently engages in retrofit projects, monitoring based commissioning, and training and education. The Need for Expansion: In November of 2013, UC President Janet Napolitano announced the Carbon Neutrality Initiative, which commits the UC to emitting net zero greenhouse gasses AB 1150 Page 4 from its buildings and car fleet by 2025. AB 1150 is in line with that goal, and expands on current practices to achieve it. If POUs have not participated in UC's Energy Efficiency Partnerships, they could do so if they wanted to. POUs have independent Governing Boards who make these decisions. While current law does not give the UC the ability to partner with Public Owned Utilities (POUs) in the Energy Efficiency Partnership Program nothing in statute prohibits UC from doing partnerships with POUs. The locations of UC campuses where there are POUs are: Los Angeles and Riverside and it is unknown whether these UC campuses are served by those local POUS, Southern California Edison, or both. There are few campuses located within the service areas of POUs. Therefore there may be little benefit to UC to enter into such partnerships. In addition, UC recently became its own electricity service provider, which is in addition to the existing direct access contracts that UC has entered into for electricity services. If a campus is not served by a POU it could be difficult for a POU to justify providing ratepayer funded incentives to that campus. Similarly, if a campus is not served by an IOU would have difficult justifying providing ratepayer funds to that campus. 3)Double referral. This bill is double referred to the Assembly Committee on Higher Education. AB 1150 Page 5 REGISTERED SUPPORT / OPPOSITION: Support University of California (Sponsor) Opposition None on file. Analysis Prepared by:Allegra Roth / U. & C. / (916) 319-2083 AB 1150 Page 6