BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 1773|
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THIRD READING
Bill No: AB 1773
Author: Obernolte (R)
Amended: 4/13/16 in Assembly
Vote: 21
SENATE ENERGY, U. & C. COMMITTEE: 10-0, 6/21/16
AYES: Hueso, Morrell, Cannella, Gaines, Hertzberg, Lara,
Leyva, McGuire, Pavley, Wolk
NO VOTE RECORDED: Hill
SENATE APPROPRIATIONS COMMITTEE: Senate Rule 28.8
ASSEMBLY FLOOR: 78-0, 5/12/16 (Consent) - See last page for
vote
SUBJECT: Local government renewable energy self-generation
program
SOURCE: Victor Valley Wastewater Reclamation Authority
DIGEST: This bill expands the Renewable Energy Self-Generation
Bill Credit Transfer (RES-BCT) program to allow participation by
joint powers authority (JPA) that are public agencies located
within the same county and within same electrical corporation
service territory. The RES-BCT program allows a local
governmental entity to operate a small renewable electricity
generating facility in one location and have the utility credit
the output of that facility against electricity the local
government consumes at another location.
ANALYSIS:
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Page 2
Existing law:
1)Establishes the RES-BCT program, which provides that a city,
county, city and county, special district, school district,
political subdivision, or other local public agency may elect
to designate another account or accounts controlled by the
governmental entity to receive bill credits for electricity
generated by a renewable generating facility located within
the boundaries of the governmental entity. (Public Utilities
Code §2830)
2)Excludes JPA from participating in the RES-BCT program.
(Public Utilities Code §2830)
3)Requires the three largest electrical corporations to offer
contracts to local governments under the RES-BCT program until
the combined statewide cumulative generating capacity of all
eligible renewable facilities within their service territories
reaches 250 megawatts (MW). (Public Utilities Code §2830)
4)Requires the California Public Utilities Commission (CPUC) to
ensure the transfer of a bill credit to a benefiting account
does not result in a shifting of costs onto bundled service
subscribers. (Public Utilities Code §2830)
5)Enables two or more public agencies by contractual agreement
to jointly exercise any power common to the contracting
agencies, thus creating a JPA. (Government Code §6500)
This bill:
1)Authorizes a limited expansion of the RES-BCT program to allow
specified JPAs to participate in the program. The JPAs'
members must be public agencies that are located within the
same county and within same electrical corporation service
territory. Specifically, this bill:
a) Expands the definition of "local government" for
purposes of the RES-BCT program to include a JPA that has
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Page 3
as members public agencies located within the same county
and same electrical corporation service territory.
b) Excludes a JPA from participating in the RES-BCT
program, if it has as members public agencies located in
different counties or different electrical corporation
service territories, or, if the JPA has as a member the
federal government, any federal department or agency, this
or another state, or any department or agency of this state
or another state.
c) Expands the definition of "benefitting account" for
purposes of the RES-BCT program to include an account or
accounts that belong to members of a JPA and are located
within the geographical boundaries of the group of public
agencies that formed the JPA, if the eligible renewable
generating facility and electricity account or accounts are
wholly located within the confines of a single county
within which the JPA is located and electric service is
provided by a single electrical corporation, with the
account or accounts being mutually agreed upon by the JPA
and the electrical corporation.
1)Specifies the following requirements:
a) The benefitting account or accounts must belong to
members of the JPA and be located within the geographical
boundaries of the group of public agencies that formed the
JPA;
b) The eligible renewable generating facility and the
electricity account or accounts must be wholly located
within the confines of a single county within which the JPA
is located;
c) Electric service must be provided by a single electrical
corporation; and,
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Page 4
d) The account or accounts must be mutually agreed upon by
the JPA and the electrical corporation.
Background
RES-BCT allows a local governmental entity to operate a small
renewable electricity generating facility (up to five MW) in one
location and have the utility credit the output of that facility
against electricity the local government consumes at another
location, known as benefitting accounts. Under current law,
JPAs are not eligible to participate in the RES-BCT program.
This is because a JPA can include the federal government or any
federal department or agency, this state, another state or any
state department or agency, a county, county board of education,
county superintendent of schools, city, public corporation,
public district, regional transportation commission of this
state or another state, a federally recognized Indian tribe, or
any JPA formed, pursuant to the Joint Exercise of Powers Act, by
any of these agencies. Therefore, contracts between JPAs and
investor-owned utilities might include benefitting accounts and
generation facilities that cross county and even state lines and
utility territories.
This bill limits the geographical scope of participating JPAs by
allowing participation only by JPAs whose members are in the
same county and served by the same electrical corporation.
Furthermore, AB 1773 limits participating JPAs by allowing only
JPAs whose benefitting accounts belong to members of the JPA and
are located within the geographical boundaries of the group of
public agencies that formed the JPA. In addition, the eligible
renewable generating facility and the electricity account or
accounts must be wholly located within the confines of a single
county within which the JPA is located, and the account or
accounts must be mutually agreed upon by the JPA and the
electrical corporation.
Related/Prior Legislation
AB 512 (Gordon, Chapter 478, Statutes of 2011) increased the
maximum size for renewable energy generating systems eligible
under the RES-BCT program from one MW to five MW.
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AB 2693 (Blumenfield, 2010) would have attempted to expand the
RES-BCT program to allow the participation of JPAs. Died in the
Assembly Committee on Utilities and Commerce.
AB 1031 (Blumenfield, Chapter 380, Statutes of 2009) expanded
the RES-BCT program to allow individual public college and
university campuses to participate.
AB 2466 (Laird, Chapter 540, Statutes of 2008) created the
RES-BCT program, which allowed a local governmental entity to
operate a small renewable electricity generating facility in one
location and have the utility credit the output of that facility
against electricity the local government consumes at another
location.
FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: Yes
SUPPORT: (Verified8/1/16)
Victor Valley Wastewater Reclamation Authority (source)
Association of California Water Agencies
California Association of Sanitation Agencies
OPPOSITION: (Verified8/1/16)
None received
ARGUMENTS IN SUPPORT: According to the author:
In 2008, AB 2466 established the RES-BCT program to
provide local governments with an avenue to maximize
their utilization of self-generated renewable energy,
which would be otherwise economically infeasible under
previously existing programs. The RES-BCT program allows
local government entities to credit energy generated from
renewable sources against electricity used at more than
just the facility where the renewable energy is
generated.
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Joint powers authorities were explicitly prohibited from
participating in the program, regardless of their
geographic scope. Organizations like the Victor Valley
Wastewater Reclamation Authority (VVWRA) that may still
operate within the bounds of a local government entity
are prohibited from participating based on their status
as a JPA. While participation in the program has grown,
there is still a fair amount of room available under the
cap of the program.
AB 1773 would expand the program to allow certain JPAs to
participate in the program. This bill would limit the
JPAs that could participate to those that are operating
with the geographic bounds of the local entities that
created them. AB 1773 would promote the adoption of more
renewable energy sources while still limiting the program
to local entity participation.
The VVWRA, the sponsor of this bill, asserts that
"Current law explicitly excludes joint powers authorities
from eligibility to participate in the RES-BCT Program,
even if they operate with the geographic bounds of a
local government entity. The VVWRA resides in the
geographic boundary of the city of Victorville. VVWRA's
Waste to Energy program is a leader in the wastewater
industry with the capability of producing enough green
energy to power our entire plant with electricity left
over. VVWRA is also in the position to expand the
program and generate even more sustainable energy. But
current law does not allow VVWRA, as a JPA, to export
that power to the grid. AB 1773 would eliminate the
barriers VVWRA is facing and allow a new green,
environmentally friendly power source for our region."
Additionally, the Association of California Water
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Agencies (ACWA) notes that "Energy efficiency is a
fundamental operating mission for ACWA's member agencies,
and the RES-BCT program incentivizes this by authorizing
a local government entity to receive a credit on their
electric bill for power generated from a renewable energy
facility that generates more energy than is needed to
serve the electrical load of that entity. ACWA believes
that the expansion of this program to utilization by
JPA's would continue to promote smart energy policy and
the increased generation of renewable energy."
ASSEMBLY FLOOR: 78-0, 5/12/16
AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker,
Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Calderon,
Campos, Chang, Chau, Chávez, Chiu, Chu, Cooley, Cooper,
Dababneh, Dahle, Daly, Dodd, Eggman, Frazier, Beth Gaines,
Gallagher, Cristina Garcia, Eduardo Garcia, Gatto, Gipson,
Gomez, Gonzalez, Gordon, Gray, Grove, Hadley, Harper, Roger
Hernández, Holden, Irwin, Jones, Kim, Lackey, Levine, Linder,
Lopez, Low, Maienschein, Mathis, Mayes, McCarty, Medina,
Melendez, Mullin, Nazarian, Obernolte, O'Donnell, Olsen,
Patterson, Quirk, Ridley-Thomas, Rodriguez, Salas, Santiago,
Steinorth, Mark Stone, Thurmond, Ting, Wagner, Waldron, Weber,
Wilk, Williams, Wood, Rendon
NO VOTE RECORDED: Burke, Jones-Sawyer
Prepared by:Aaron Brieno/Jay Dickenson / E., U., & C. / (916)
651-4107
8/3/16 18:40:24
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