(a) As used in this section, “clean distributed energy
4resource” means a facility that is located on the customer’s
5premises and generates electricity, or electricity and useful heat,
6where the electricity generated is used for a purpose described in
7paragraph (1) or (2) of subdivision (b) of Section 218, and that
8meets, as determined for each year of eligibility based on the then
9current criteria, either of the following requirements:
10(1) It meets all of the following criteria:
11(A) Meets or exceeds the greenhouse gas emissions reduction
12standards established pursuant to subdivision (b).
13(B) Complies with the oxides of nitrogen (NOx) emissions
14standards adopted by the State Air Resources Board pursuant to
15the distributed generation certification program
16Cal. Code Regs. 94203).
17(C) Has a nameplate rated generation capacity of 15 megawatts
19(D) Is sized to meet the electrical demand of, or use the available
20waste heat of, the customer that will be served by the facility.
21(2) It meets all of the following criteria:
22(A) Is an eligible renewable energy resource, pursuant to the
23California Renewables Portfolio Standard Program (Article 16
24(commencing with Section 399.11)).
25(B) Has a nameplate rated generation capacity of 15 megawatts
27(C) Is sized to meet the electrical demand of the customer that
28will be served by the facility.
29(D) Will not otherwise be addressed in the commission’s
30implementation of Section 769 or 2827.1.
31(b) (1) The State Air Resources Board, in consultation with the
Energy Commission, shall establish a schedule of annual
33greenhouse gas emissions reduction standards for a clean
34distributed energy resource, for the purpose of paragraph (1) of
35subdivision (a), not later than March 31, 2016, and shall update
36the schedule every three years, with applicable standards for each
P6 1(2) The greenhouse gas emissions reduction standards shall
2ensure that each eligible clean distributed energy resource, for
3the purpose of paragraph (1) of subdivision (a), reduces
4greenhouse gas emissions compared to the electrical grid
5resources, including renewable resources, that the clean distributed
6energy resource displaces, accounting for both procurement and
7operation of the electrical grid.
8(c) (1) In order to promote a modern electrical grid that
9provides a stable and reliable supply of electricity, the commission,
10in consultation with the Energy Commission and State Air
11Resources Board, shall
promote the deployment of clean distributed
13(2) The commission shall prioritize deployment of smart grids,
14microgrids, and reliable energy resources that reduce emissions
15of greenhouse gases to promote the following cobenefits:
16(A) Deployment of innovative technologies in California
17communities, especially disadvantaged communities.
18(B) Reduction of the use of water to generate electricity to assist
19with the drought.
20(C) Assistance to the state in reaching its State Implementation
21Plan goals for clean air.
22(d) To the extent authorized by federal law, by July 1, 2016, the
23commission shall require each electrical corporation to do the
24following for customers served by clean distributed energy
25resources installed after January 1,
26(1) Collect all applicable nonbypassable charges fixed,
27implemented, administered, or imposed by the commission based
28only on the actual metered consumption of electricity delivered to
29the customer through the electrical corporation’s transmission or
30distribution system. All charges shall be at the same rate per
31kilowatthour as paid by other customers that do not employ a clean
32distributed energy resource under the electrical corporation’s
33applicable rate schedule.
34(2) Identify the total amount of nonbypassable charges that
35would be collected each year from customers served by clean
36distributed energy resources installed after January 1, 2016, based
37on gross consumption without any adjustment for the generation
38of the clean distributed energy resources. This total amount shall
39be fully recovered from customers in the same customer class as
40those customers served by clean distributed energy
P7 1installed after January 1, 2016, and no amount may be shifted to
2any other customer class.
3(3) (A) Calculate a reserve capacity for standby service, if
4applicable, based on the capacity needed by an electrical
5corporation to serve a customer’s electrical demand during an
6outage of the clean distributed energy resource providing electric
7service for that customer.
8(B) Initial reserve capacity shall be established by the customer
9for a minimum of 12 months based on the clean distributed energy
10resource generation technology’s historical operation, the number,
11size, and outage diversity of the clean distributed energy resource,
12and the annual average reduction of customer load that could
13occur during an outage.
14(C) If after the initial 12-month period, the electrical corporation
15reasonably determines that the reserve
capacity does not reflect
16the customer’s actual standby demand, averaged over the previous
1712 months, the electrical corporation shall modify the reserve
18capacity once every 12 months to reflect the customer’s actual
19average annual reserve capacity based on the same criteria used
20to establish the initial reserve capacity. Calculation of actual
21average annual reserve capacity shall exclude the customer’s
22electrical demand served by the electrical corporation within 24
23hours following an outage of the clean distributed energy resource
24resulting from any event on the electrical corporation’s
25transmission or distribution grid that is outside of the customer’s
26control that requires the customer to reduce onsite generation.
27(e) A customer served by a clean distributed energy resource
28shall provide relevant data to the commission and the State Air
29Resources Board annually. The facility shall be subject to onsite
30inspection to verify equipment operation and
31including capacity, thermal output, and usage, to verify applicable
32criteria for air pollutant and greenhouse gases emissions
33performance. Requests for relevant data shall occur no more than
34once per year.
35(f) (1) The Energy Commission, in consultation with the
36commission, shall report on the impacts of this section in the
37integrated energy policy report to be filed on or before November
381, 2017, and November 1, 2019.
P8 1(2) The report to be submitted pursuant to this subdivision shall
2be submitted in compliance with Section 9795 of the Government
4(3) The requirement for submitting a report pursuant to this
5subdivision is inoperative on November 1, 2021, pursuant to
6Section 10231.5 of the Government Code.
7(g) The commission shall suspend the eligibility of new
customers to receive service pursuant to the rate program
9established pursuant to subdivision (d) on December 31, 2020.
10Customers that installed clean distributed energy resources after
11January 1, 2016, that became operational prior to suspension of
12eligibility pursuant to this subdivision and continue to generate
13electricity from their clean distributed energy resources after
14suspension shall continue to participate in the rate program
15established pursuant to subdivision (d) for the entire useful life of
16their clean distributed energy resource.