Amended in Senate September 1, 2015

Amended in Senate August 18, 2015

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. begin deleteEnergy Efficiency Resource Standard Act. end deletebegin insertDemand response.end insert

Under existing law, the Public Utilities Commissionbegin insert (PUC)end insert has regulatory authority over public utilities, including electrical corporations and gas corporations, as defined, while local publicly owned electric utilities, as defined,begin delete and local publicly owned gas utilitiesend delete are under the direction of their governing boards.begin delete 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.end delete

begin delete

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.

end delete

The existing Warren-Alquist State Energy Resources Conservation and Development Actbegin delete establishes the State Energy Resources Conservation and Development Commission. Existing lawend delete requires thebegin insert Stateend insert Energybegin delete Commission,end deletebegin insert Resources Conservation and Development Commission (Energy Commission),end insert on or before November 1, 2007, and every 3 years thereafter, in consultation with thebegin delete Public Utilities Commissionend deletebegin insert PUCend insert 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.

begin delete

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 by electrical corporations 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. 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. The bill would require the State Energy Resources Conservation and Development Commission, in a public stakeholder engagement process and in consultation with the Public Utilities Commission, to determine how the energy savings goals of the act are measured and reported. The act would require each community choice aggregator that administers energy efficiency programs, electrical utility, and gas utility, as defined, meeting specified energy delivered thresholds, to establish an energy efficiency resource standard that increases the amount of energy efficiency resources, as defined, of the community choice aggregator, electrical utility, or gas utility so that the minimum amount of incremental energy savings achieved within its service territory in any given year amounts to not less than specified amounts. The bill would require the State Energy Resources Conservation and Development Commission, in a public stakeholder process and in consultation with the Public Utilities Commission, to adopt a cost limitation, as necessary, for each electrical utility, gas utility, and community choice aggregator for meeting the energy efficiency resource standard. The bill would require the State Energy Resources Conservation and Development Commission to establish an annual demand response procurement goal, as specified. The bill would require the Public Utilities Commission to require electrical corporations achieve the annual procurement goal 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 the annual procurement goal. The bill would require that benefits, including energy savings achieved, within disadvantaged communities identified by the California Environmental Protection Agency, as specified, be given the highest priority for energy efficiency activities undertaken pursuant to the bill’s requirements. The bill would require each electrical utility and gas utility to annually file with the State Energy Resources Conservation and Development Commission, a report that analyzes the energy savings achieved within the utility’s service territory during the prior year, divided by the energy retail sales in the immediately preceding year.

end delete
begin insert

This bill would require the PUC, in consultation with the Energy Commission, electrical corporations, local publicly owned electric utilities, and community choice aggregators, to establish an annual procurement goal for demand response designed to lower peak demand, with a timetable for achieving that percentage. The bill would require the PUC to require electrical corporations to achieve the annual procurement goal. The bill would specify that the governing boards of local publicly owned electric utilities and certain community choice aggregators are responsible for achieving the annual procurement goal.

end insert

Under existing law, a violation of any order, decision, rule, direction, demand, or requirement of the Public Utilities Commission is a crime.

Because a violation of an order or decision of the Public Utilities Commission implementing the bill’s requirements with respect to an electrical corporationbegin delete or gas corporationend delete 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 electricbegin delete and gasend delete 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    1begin insert

begin insertSECTION 1.end insert  

end insert

begin insertChapter 7 (commencing with Section 8400) is
2added to Division 4.1 of the end insert
begin insertPublic Utilities Codeend insertbegin insert, to read:end insert

begin insert

3 

4Chapter  begin insert7.end insert Demand Response
5

 

6

begin insert8400.end insert  

(a) By November 1, 2017, the commission, in
7consultation with the Energy Commission, electrical corporations,
8local publicly owned electric utilities, and community choice
9aggregators, in a public process that allows input from other
10stakeholders, shall establish an annual procurement goal for
P5    1demand response designed to lower peak demand, with a timetable
2for achieving that goal, that shall support renewable energy
3resources integration, greenhouse gas reductions, and grid
4reliability and that shall be achieved by each electrical utility
5through supply-side demand response and types of load-modifying
6demand response, including nonevent-based demand response. In
7doing so, the commission shall consider the role of clean
8technologies, such as consumer-sited energy storage, electric
9vehicle charging, and distributed generation resources.

10(b) The commission shall require electrical corporations to
11achieve the procurement goal established pursuant to subdivision
12(a).

13(c) The governing board of each local publicly owned electric
14utility and each community choice aggregator that elects to
15administer energy efficiency programs for its customers pursuant
16to Section 381.1 shall be responsible for achieving the procurement
17goal established pursuant to subdivision (a).

end insert
18begin insert

begin insertSEC. 2.end insert  

end insert
begin insert

No reimbursement is required by this act pursuant to
19Section 6 of Article XIII B of the California Constitution because
20a local agency or school district has the authority to levy service
21charges, fees, or assessments sufficient to pay for the program or
22level of service mandated by this act or because costs that may be
23incurred by a local agency or school district will be incurred
24because this act creates a new crime or infraction, eliminates a
25crime or infraction, or changes the penalty for a crime or
26infraction, within the meaning of Section 17556 of the Government
27Code, or changes the definition of a crime within the meaning of
28Section 6 of Article XIII B of the California Constitution.

end insert
begin delete
29

SECTION 1.  

Chapter 7 (commencing with Section 8400) is
30added to Division 4.1 of the Public Utilities Code, to read:

31 

32Chapter  7. Energy Efficiency
33

 

34

8400.  

(a) This chapter shall be known, and may be cited, as
35the Energy Efficiency Resource Standard Act.

36(b) The commission, in consultation with the Energy
37Commission, shall be responsible for supervising the
38implementation of this chapter by electrical corporations and gas
39corporations. The governing board of a community choice
40aggregator, in consultation with the commission, shall be
P6    1responsible for implementation of this chapter if the community
2choice aggregator administers energy efficiency programs for its
3customers pursuant to Section 381.1.

4(c) The governing board of each local publicly owned electric
5utility and local publicly owned gas utility, in consultation with
6the Energy Commission, shall be responsible for the
7implementation of this chapter by the utility.

8(d) The Energy Commission, in consultation with the
9commission, shall, in a public stakeholder engagement process,
10determine how the energy savings goals of this chapter are
11measured and reported.

12

8401.  

For purposes of this chapter, the following terms have
13the following meanings:

14(a) “Electrical utility” means an electrical corporation or local
15publicly owned electric utility.

16(b) “Energy efficiency resources” mean activities that reduce
17demand for energy from supply-side resources.

18(c) “Energy savings” means a reduction in electricity use in
19kilowatthours or in fossil fuel use in thermal units.

20(d) “Gas utility” means a gas corporation or local publicly owned
21gas utility serving retail end-use customers in California.

22

8402.  

(a) An electrical utility or community choice aggregator
23is exempt from the energy efficiency resource standard
24requirements of this chapter if its average annual retail sales of
25electricity in the immediately preceding three years was less than
26or equal to 1,000 gigawatthours. If three years of data are not
27available, the best data available shall be used to determine if sales
28exceed this threshold.

29(b) A gas utility is exempt from the energy efficiency resource
30standard requirements of this chapter if its average annual retail
31sales of natural gas in the immediately preceding three years was
32less than or equal to 50 million therms. If three years of data are
33not available, the best data available shall be used to determine if
34sales exceed this threshold.

35

8405.  

(a) Each electrical utility shall establish an energy
36efficiency resource standard that shall increase the amount of
37energy efficiency resources in its service territory, inclusive of all
38of its energy efficiency activities within its service territory, funded
39by its customers, with the exception of energy efficiency activities
40administered by a community choice aggregator within the
P7    1community choice aggregator’s service territory pursuant to Section
2381.1, so that the minimum amount of incremental energy savings
3achieved in any given year amounts to not less than 112 percent
4of its total retail sales of electricity by 2020, and not less than 2
5percent of its total annual retail sales of electricity by 2025. The
6total amount of incremental energy savings shall be determined
7based upon the average retail sales of electricity in the immediately
8preceding three years, measured in gigawatthours per year based
9on annual comparison of the Energy Commission’s integrated
10energy policy reports made pursuant to Section 25302 of the Public
11Resources Code or a similar public report, excluding the measured
12or reliably estimated sales of electricity associated with electric
13vehicle charging and net, round-trip electricity losses associated
14with electricity consumer-sited energy storage.

15(b) Each community choice aggregator that elects to administer
16energy efficiency programs for its customers pursuant to Section
17381.1 shall establish an energy efficiency resource standard that
18shall increase the amount of energy efficiency resources in its
19service territory, inclusive of all of its energy efficiency activities,
20so that the minimum amount of incremental energy savings
21achieved in any given year amounts to not less than 112 percent
22of its total retail sales of electricity by 2020, and not less than 2
23percent of its total annual retail sales of electricity by 2025. The
24total amount of incremental energy savings shall be determined
25based upon the community choice aggregator’s average retail sales
26of electricity of the immediately preceding three years, measured
27in gigawatthours per year based on comparison of the Energy
28Commission’s integrated energy policy reports made pursuant to
29Section 25302 of the Public Resources Code or a similar public
30report, including electricity sales by electric service providers and
31excluding the measured or reliably estimated sales of electricity
32associated with electric vehicle charging and net, round-trip
33electricity losses associated with electricity consumer-sited energy
34storage. If a community choice aggregator has fewer than three
35years of retail sales of electricity, the total amount of incremental
36energy savings shall be determined based on the total annual retail
37sales of electricity of the immediately preceding year or two.

38(c) The Energy Commission, in consultation with the
39commission, in a public stakeholder engagement process, shall
40adopt a cost limitation, as necessary, for each electric utility and
P8    1community choice aggregator subject to this chapter for meeting
2the requirements of this section.

3

8406.  

(a) By July 31, 2017, the Energy Commission, in
4consultation with the commission, shall establish an annual
5procurement goal for demand response that shall be achieved by
6each electrical utility and community choice aggregator, as
7appropriate. The demand response procurement goals shall support
8renewable energy integration, greenhouse gas reductions, and grid
9 reliability through supply-side event-based demand response with
10consideration of the role of clean technologies, electricity
11consumer-sited energy storage, electric vehicle charging, and
12distributed generation resources.

13(b) The commission shall require that electrical corporations
14achieve the annual procurement goal established in subdivision
15(a).

16(c) The governing board of each local publicly owned electric
17utility, and community choice aggregator that elects to administer
18energy efficiency programs for its customers pursuant to Section
19381.1, shall be responsible for achieving the annual procurement
20goal established in subdivision (a).

21

8410.  

(a) Each gas utility shall establish an energy efficiency
22resource standard that shall increase the amount of energy
23efficiency resources, inclusive of all of its energy efficiency
24activities, of the utility so that the minimum amount of incremental
25energy savings achieved within its service territory in any given
26year amounts to not less than three-fourths of 1 percent of its total
27 annual system natural gas retail sales by 2020, and not less than 1
28percent of its system annual natural gas retail sales by 2025. The
29total amount of incremental energy savings shall be determined
30based upon the average retail sales of natural gas within its service
31territory in the immediately preceding three years, measured in
32millions of therms per year based on an annual comparison of the
33Energy Commission’s integrated energy policy reports made
34pursuant to Section 25302 of the Public Resources Code or a
35similar public report, excluding the measured or reliably estimated
36sales of natural gas associated with natural gas vehicle fueling
37during the preceding three years.

38(b) The Energy Commission, in consultation with the
39commission, in a public stakeholder engagement process, shall
P9    1adopt a cost limitation, as necessary for each gas utility subject to
2this chapter for meeting the requirements of this section.

3

8415.  

(a) Benefits, including energy savings achieved, within
4disadvantaged communities, as identified by the California
5Environmental Protection Agency pursuant to Section 39711 of
6the Health and Safety Code, shall be given the highest priority for
7energy efficiency activities undertaken by electrical utilities, gas
8utilities, and community choice aggregators pursuant to this
9chapter.

10(b) The Legislature recognizes that the Energy Savings
11Assistance Program (ESAP), formerly known as the Low Income
12Energy Efficiency Program, for low-income households carried
13out pursuant to Section 2790 provides not only energy benefits,
14but also non-energy benefits such as health, comfort, and safety
15benefits, which helps reduce the hardships facing low-income
16households. The Legislature recognizes the importance of those
17non-energy benefits. Therefore, nothing in this chapter results in
18a reduction in energy related services that provide non-energy
19benefits to low-income households pursuant to ESAP.

20(c) Each electrical utility and gas utility shall annually file with
21the Energy Commission, a report that analyzes the energy savings
22achieved within the utility’s service territory during the prior year,
23divided by the energy retail sales in the immediately preceding
24year. An electrical utility is not required to report energy savings
25achieved by community choice aggregators within its service
26territory.

27(d) Each community choice aggregator subject to an energy
28efficiency resource standard pursuant to this chapter shall annually
29file with the Energy Commission a report that analyzes the energy
30savings achieved by the community choice aggregator within its
31service territory during the prior year, divided by its energy retail
32sales in the immediately preceding year.

33

SEC. 2.  

No reimbursement is required by this act pursuant to
34Section 6 of Article XIII B of the California Constitution because
35a local agency or school district has the authority to levy service
36charges, fees, or assessments sufficient to pay for the program or
37level of service mandated by this act or because costs that may be
38incurred by a local agency or school district will be incurred
39because this act creates a new crime or infraction, eliminates a
40crime or infraction, or changes the penalty for a crime or infraction,
P10   1within the meaning of Section 17556 of the Government Code, or
2changes the definition of a crime within the meaning of Section 6
3of Article XIII B of the California Constitution.

end delete


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