Amended in Senate June 30, 2015

Amended in Assembly June 2, 2015

Amended in Assembly April 27, 2015

California Legislature—2015–16 Regular Session

Assembly BillNo. 1330


Introduced by Assembly Member Bloom

February 27, 2015


An act to add Chapter 7 (commencing with Section 8400) to Division 4.1 of the Public Utilities Code, relating to energy.

LEGISLATIVE COUNSEL’S DIGEST

AB 1330, as amended, Bloom. Energy Efficiency Resource Standard Act.

Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations and gas corporations, as defined, while local publicly owned electric utilities, as defined, and local publicly owned gas utilities are under the direction of their governing boards. The Public Utilities Act requires the Public Utilities Commission to review and accept, modify, or reject a procurement plan for each electrical corporation in accordance with specified elements, incentive mechanisms, and objectives, including a showing that the electrical corporation will first meet its unmet needs through all available energy efficiency and demand reduction resources that are cost effective, reliable, and feasible. The act requires the Public Utilities Commission, in consultation with the State Energy Resources Conservation and Development Commission, to identify all potentially achievable cost-effective electricity efficiency savings and to establish efficiency targets for electrical corporations to achieve pursuant to their procurement plan. The act requires the Public Utilities Commission, in consultation with the State Energy Resources Conservation and Development Commission, to identify all potentially achievable cost-effective natural gas efficiency savings and to establish efficiency targets for gas corporations to achieve and requires that a gas corporation first meet its unmet resource needs through all available gas efficiency and demand reduction resources that are cost effective, reliable, and feasible.

Existing law requires each local publicly owned electric utility, in procuring energy, to first acquire all available energy efficiency and demand reduction resources that are cost effective, reliable, and feasible. Existing law additionally requires each local publicly owned electric utility to report annually to its customers and to the State Energy Resources Conservation and Development Commission, its investment in energy efficiency and demand reduction programs, which report is to include a description of programs, expenditures, and expected and actual energy savings results. Existing law requires a local publicly owned electric utility to be responsible for implementing an energy efficiency program that recognizes the Legislature’s intent to encourage energy savings and greenhouse gas emission reductions in existing residential and nonresidential buildings, and to include in the above-described report, its status in implementing the program.

The existing Warren-Alquist State Energy Resources Conservation and Development Act establishes the State Energy Resources Conservation and Development Commission. Existing law requires the Energy Commission, on or before November 1, 2007, and every 3 years thereafter, in consultation with the Public Utilities Commission and local publicly owned electric utilities, in a public process that allows input from other stakeholders, to develop a statewide estimate of all potentially achievable cost-effective electricity and natural gas efficiency savings and establish statewide annual targets for energy efficiency savings and demand reduction over 10 years.

This bill would enact the Energy Efficiency Resource Standard Act. The Public Utilities Commission, in consultation with the State Energy Resources Conservation and Development Commission, would be responsible for supervising the implementation of the act bybegin delete community choice aggregators, electric service providers,end delete electricalbegin delete corporations,end deletebegin insert corporationsend insert and gas corporations. The governing board of each local publicly owned electric utility and local publicly owned gas utility, in consultation with the State Energy Resources Conservation and Development Commission, would be responsible for the implementation of the act by the utility.begin insert The governing board of a community choice aggregator that administers energy efficiency programs, as specified, in consultation with the Public Utilities Commission, would be responsible for implementation of the act by that entity.end insert The bill would require the State Energy Resources Conservation and Development Commission, in a public stakeholder engagementbegin delete process,end deletebegin insert process and in consultation with the Public Utilities Commission,end insert to determine how the energy savings goals of the act are measured and reported. The act would require eachbegin delete retail seller of electricityend deletebegin insert community choice aggregator that administers energy efficiency programs, electrical utility,end insert and gas utility, as defined,begin delete toend deletebegin insert meeting specified energy delivered thresholds, toend insert establish an energy efficiency resource standard thatbegin delete shall increaseend deletebegin insert increasesend insert the amount of energy efficiencybegin delete resourcesend deletebegin insert end insertbegin insertresources, as defined,end insert of thebegin insert community choice aggregator, electrical or gasend insert utility so that the minimum amount of incremental energy savings achievedbegin insert within its service territoryend insert in any given year amounts to not less than specified amounts. The bill would require the State Energy Resources Conservation and Development Commission,begin insert in a public stakeholder process andend insert in consultation with the Public Utilities Commission, to adopt a cost limitation, as necessary, for eachbegin delete retail seller of electricityend deletebegin insert electrical utility, gas utility, and community choice aggregatorend insert for meeting the energy efficiency resource standard. The bill would require thebegin delete Public Utilitiesend deletebegin insert State Energy Resources Conservation and Developmentend insert Commission to establishbegin delete anend delete annualbegin delete percentageend deletebegin insert percentagesend insert of peak demand reductionsbegin delete that shallend deletebegin insert toend insert be achieved through event-based demand responsebegin delete and would require that annual percentage to be achieved by retail sellers of electricity.end deletebegin insert in consideration of specified matter. The bill would require the Public Utilities Commission to require electrical corporations achieve these annual percentages and would require the governing board of each local publicly owned electric utility and community choice aggregator subject to the bill’s requirements to be responsible for achieving these annual percentages.end insert The bill would require thatbegin delete the energy savings of a retail seller of electricity or gas utility first come fromend deletebegin insert benefits, including energy savings achieved, withinend insert disadvantaged communities identified by the California Environmental Protection Agency, asbegin delete specified.end deletebegin insert specified, be given the highest priority for energy efficiency activities undertaken pursuant to the bill’s requirements.end insert The bill would require eachbegin delete retail seller of electricityend deletebegin insert electrical utilityend insert and gas utility to annually file with the State Energy Resources Conservation and Development Commission, a report that analyzes the energy savings achievedbegin delete by the utilityend deletebegin insert within the utility’s service territoryend insert during the prior year, divided by the energy retail sales in the immediately preceding year.

Under existing law, a violation of any order, decision, rule, direction, demand, or requirement of thebegin delete commissionend deletebegin insert Public Utilities Commissionend insert is a crime.

Because a violation of an order or decision of thebegin delete commissionend deletebegin insert Public Utilities Commissionend insert implementing the bill’s requirements with respect tobegin delete a community choice aggregator, electric service provider,end deletebegin insert anend insert electricalbegin delete corporation,end deletebegin insert corporationend insert or gas corporation would be a crime, the bill would impose a state-mandated local program by creating a new crime. By placing additional requirements upon local publicly owned electric and gas utilities, the bill would impose a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for specified reasons.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.

The people of the State of California do enact as follows:

P4    1

SECTION 1.  

Chapter 7 (commencing with Section 8400) is
2added to Division 4.1 of the Public Utilities Code, to read:

3 

4Chapter  7. Energy Efficiency
5

 

6

8400.  

(a) This chapter shall be known, and may be cited, as
7the Energy Efficiency Resource Standard Act.

8(b) The commission, in consultation with the Energy
9Commission, shall be responsible for supervising the
10implementation of this chapter bybegin delete community choice aggregators,
11as defined in Section 331.1, electric service providers, electrical
12corporations,end delete
begin insert electrical corporationsend insert and gas corporations.begin insert The
13governing board of a community choice aggregator, in consultation
14with the commission, shall be responsible for implementation of
15this chapter if the community choice aggregator administers energy
16efficiency programs for its customers pursuant to Section 381.1.end insert

P5    1(c) The governing board of each local publicly owned electric
2utility and local publicly owned gas utility, in consultation with
3the Energy Commission, shall be responsible for the
4implementation of this chapter by the utility.

5(d) The Energybegin delete Commissionend deletebegin insert Commission, in consultation with
6the commission,end insert
shall, in a public stakeholder engagement process,
7determine how the energy savings goals of this chapter are
8measured and reported.

9

8401.  

For purposes of this chapter, the following terms have
10the following meanings:

begin insert

11(a) “Electrical utility” means an electrical corporation or local
12publicly owned electric utility.

end insert
begin insert

13(b) “Energy efficiency resources” mean activities that reduce
14demand for energy from supply-side resources.

end insert
begin delete

15(a)

end delete

16begin insert(c)end insert “Energy savings” means a reduction in electricity use in
17kilowatthours or in fossil fuel use in thermal units.

begin delete

18(b)

end delete

19begin insert(d)end insert “Gas utility” means a gas corporation or local publicly owned
20gas utility serving retail end-use customers in California.

begin delete

21(c) “Retail seller” has the same meaning as that term is defined
22in Section 399.12, except that retail seller includes local publicly
23owned electric utilities.

end delete
begin insert
24

begin insert8402.end insert  

(a) An electrical utility or community choice aggregator
25is exempt from the energy efficiency resource standard
26requirements of this chapter if its average annual retail sales of
27electricity in the immediately preceding three years was less than
28or equal to 1,000 gigawatthours. If three years of data are not
29available, the best data available shall be used to determine if
30sales exceed this threshold.

31(b) A gas utility is exempt from the energy efficiency resource
32standard requirements of this chapter if its average annual retail
33sales of natural gas in the immediately preceding three years was
34less than or equal to 50 million therms. If three years of data are
35not available, the best data available shall be used to determine
36if sales exceed this threshold.

end insert
37

8405.  

(a) Eachbegin delete retail seller of electricityend deletebegin insert electrical utilityend insert shall
38establish an energy efficiency resource standard that shall increase
39the amount of energy efficiencybegin delete resources,end deletebegin insert resources in its service
40territory,end insert
inclusive of all of its energy efficiencybegin delete activities, of the
P6    1utilityend delete
begin insert activities within its service territory, funded by its customers,
2with the exception of energy efficiency activities admistered by a
3community choice aggregator within the community choice
4aggregator’s service territory pursuant to Section 381.1,end insert
so that
5the minimum amount of incremental energy savings achieved in
6any given year amounts to not less than 112 percent of its total
7retail sales of electricity by 2020, and not less than 2 percent of
8its totalbegin insert annualend insert retail sales of electricity by 2025. The total amount
9of incremental energy savings shall be determined based upon the
10average retail sales of electricitybegin delete ofend deletebegin insert inend insert the immediately preceding
11three years, measured in gigawatthours per year based onbegin insert annualend insert
12 comparison of the Energy Commission’s integrated energy policy
13reports made pursuant to Section 25302 of the Public Resources
14begin delete Code.end deletebegin insert Code or a similar public report, excluding the measured or
15reliably estimated sales of electricity associated with electric
16vehicle charging and net, round-trip electricity losses associated
17with electricity consumer-sited energy storage.end insert

begin insert

18(b) Each community choice aggregator that elects to administer
19energy efficiency programs for its customers pursuant to Section
20381.1 shall establish an energy efficiency resource standard that
21shall increase the amount of energy efficiency resources in its
22service territory, inclusive of all of its energy efficiency activities,
23so that the minimum amount of incremental energy savings
24achieved in any given year amounts to not less than 112 percent
25of its total retail sales of electricity by 2020, and not less than 2
26percent of its total annual retail sales of electricity by 2025. The
27total amount of incremental energy savings shall be determined
28based upon the community choice aggregator’s average retail
29sales of electricity of the immediately preceding three years,
30measured in gigawatthours per year based on comparison of the
31Energy Commission’s integrated energy policy reports made
32pursuant to Section 25302 of the Public Resources Code or a
33 similar public report, including electricity sales by electric service
34providers and excluding the measured or reliably estimated sales
35of electricity associated with electric vehicle charging and net,
36round-trip electricity losses associated with electricity
37consumer-sited energy storage. If a community choice aggregator
38has fewer than three years of retail sales of electricity, the total
39amount of incremental energy savings shall be determined based
P7    1on the total annual retail sales of electricity of the immediately
2preceding year or two.

end insert
begin delete

3(b)

end delete

4begin insert(c)end insert The Energy Commission, in consultation with the
5commission,begin insert in a public stakeholder engagement process,end insert shall
6adopt a cost limitation, as necessary, for eachbegin delete retail seller of
7electricity,end delete
begin insert electric utility and community choice aggregator subject
8to this chapterend insert
for meeting the requirements of this section.

9

8406.  

(a) begin deleteThe commission shall establish an annual percentage end delete
10begin insertBy July 31, 2017, the Energy Commission, in consultation with
11the commission, shall establish annual percentages end insert
of peak demand
12reductions that shall be achievedbegin insert by each electrical utility and
13community choice aggregatorend insert
through event-based demand
14begin delete response.end deletebegin insert response with consideration of the role of electricity
15consumer-sited energy storage, electric vehicle charging, and
16distributed generation resources, with a timetable for achieving
17those peak demand reductions.end insert

18(b) The commission shall require thatbegin delete community choice
19aggregators, electric service providers, andend delete
electrical corporations
20achieve the annual percentage established in subdivision (a).

21(c) The governing board of each local publicly owned electric
22begin delete utilityend deletebegin insert utility, and community choice aggregator that elects to
23administer energy efficiency programs for its customers pursuant
24to Section 381.1,end insert
shall be responsible for achieving the annual
25percentage established in subdivision (a).

26

8410.  

begin insert(a)end insertbegin insertend insertEach gas utility shall establish an energy efficiency
27resource standard that shall increase the amount of energy
28efficiency resources, inclusive of all of its energy efficiency
29activities, of the utility so that the minimum amount of incremental
30energy savings achievedbegin insert within its service territoryend insert in any given
31year amounts to not less than three-fourths of 1 percent of its total
32begin insert annualend insert system natural gas retail sales by 2020, and not less than
331 percent of its systembegin insert annualend insert natural gas retail sales by 2025. The
34total amount of incremental energy savings shall be determined
35based upon the average retail sales of natural gasbegin delete ofend deletebegin insert within its
36service territory inend insert
the immediately preceding three years,
37measured in millions of therms per year based onbegin insert an annualend insert
38 comparison of the Energy Commission’s integrated energy policy
39reports made pursuant to Section 25302 of the Public Resources
40begin delete Code.end deletebegin insert Code or a similar public report, excluding the measured or
P8    1reliably estimated sales of natural gas associated with natural gas
2vehicle fueling during the preceding three years.end insert

begin insert

3(b) The Energy Commission, in consultation with the
4commission, in a public stakeholder engagement process, shall
5adopt a cost limitation, as necessary for each gas utility subject
6to this chapter for meeting the requirements of this section.

end insert
7

8415.  

(a) begin deleteThe energy savings of a retail seller of electricity or
8gas utility shall first come from disadvantaged communities end delete

9begin insertBenefits, including energy savings achieved, within disadvantaged
10communities, as end insert
identified by the California Environmental
11Protection Agency pursuant to Section 39711 of the Health and
12Safetybegin delete Code.end deletebegin insert Code, shall be given the highest priority for energy
13efficiency activities undertaken by electrical utilities, gas utilities,
14and community choice aggregators pursuant to this chapter.end insert

begin insert

15(b) The Legislature recognizes that the Energy Savings
16Assistance Program (ESAP), formerly known as the Low Income
17Energy Efficiency Program, for low-income households carried
18out pursuant to Section 2790 provides not only energy benefits,
19but also non-energy benefits such as health, comfort, and safety
20benefits, which helps reduce the hardships facing low-income
21households. The Legislature recognizes the importance of those
22non-energy benefits. Therefore, nothing in this chapter results in
23a reduction in energy related services that provide non-energy
24benefits to low-income households pursuant to ESAP.

end insert
begin delete

25(b)

end delete

26begin insert(c)end insert Eachbegin delete retail seller of electricityend deletebegin insert electrical utilityend insert and gas utility
27shall annually file with the Energy Commission, a report that
28analyzes the energy savings achievedbegin delete by the utilityend deletebegin insert within the
29utility’s service territoryend insert
during the prior year, divided by the
30energy retail sales in the immediately preceding year.begin insert An electrical
31utility is not required to report energy savings achieved by
32community choice aggregators within its service territory.end insert

begin insert

33(d) Each community choice aggregator subject to an energy
34efficiency resource standard pursuant to this chapter shall annually
35file with the Energy Commission a report that analyzes the energy
36savings achieved by the community choice aggregator within its
37service territory during the prior year, divided by its energy retail
38sales in the immediately preceding year.

end insert
39

SEC. 2.  

No reimbursement is required by this act pursuant to
40Section 6 of Article XIII B of the California Constitution because
P9    1a local agency or school district has the authority to levy service
2charges, fees, or assessments sufficient to pay for the program or
3level of service mandated by this act or because costs that may be
4incurred by a local agency or school district will be incurred
5because this act creates a new crime or infraction, eliminates a
6crime or infraction, or changes the penalty for a crime or infraction,
7within the meaning of Section 17556 of the Government Code, or
8changes the definition of a crime within the meaning of Section 6
9of Article XIII B of the California Constitution.



O

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