BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                    AB 1937


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          CONCURRENCE IN SENATE AMENDMENTS


          AB  
          1937 (Gomez and Williams)


          As Amended  August 17, 2016


          Majority vote


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          Original Committee Reference:  U. & C.


          SUMMARY:  Requires an electric investor-owned utility (IOU) that  
          bids for new gas-fired generation resources to consider, and  
          give preference to, bids for resources that are not gas-fired  
          generation resources located in communities that suffer from  
          cumulative pollution burdens and directs the California Public  
          Utilities Commission (CPUC) to ensure IOU procurement plans  
          include showings that the IOU contains this element.


          The Senate amendments:


          1)Apply the provisions of this bill to new gas-fired generation  
            facilities, thereby excluding applying the provisions of this  
            bill to projects that refurbish (known as repowering)  
            gas-fired generation facilities.










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          2)Specifies that this bill does not apply to utility contracts  
            signed before January 1, 2017.


          3)Make a technical amendment to relocate provisions applicable  
            to the CPUC to a more appropriate location in the code and  
            makes minor technical amendments to terms used to describe gas  
            generators.


          FISCAL EFFECT:  According to the Senate Appropriations  
          Committee, one-time costs of approximately $93,000 to the CPUC  
          (Utilities Reimbursement Account) to conduct a rulemaking.


          COMMENTS:  


          1)Procurement Plans Tell How an IOU Will Procure Electricity to  
            Meet the Needs of its Customers:  The CPUC describes its  
            long-term procurement plan (LTPP) proceedings as intended to  
            ensure a safe, reliable and cost-effective electricity supply  
            in California through integration and refinement of a  
            comprehensive set of procurement policies, practices and.   
            LTPP proceedings take a 10-year-ahead look at system, local,  
            and flexible needs.  Proceeding assumptions are revised every  
            two years to incorporate changes in the resource mix and  
            revisions to state policies.  


            An IOU's procurement plan - part of an LTPP proceeding -  
            details how much and sources of electricity that the IOU will  
            procure to meet its customer demand.  These plans must adhere  
            to state policies, including the loading order, which mandates  
            that utilities first meet the demand for electricity through  
            cost-effective energy efficiency and demand response, followed  
            by procurement of renewable energy and, lastly, procurement of  
            fossil-fuel-generated electricity.  If an IOU's procurement  
            plan does not comply with state policies or adequately balance  
            safety, reliability, cost, and environmental goals, the CPUC  
            orders the IOU to modify the plan.









                                                                    AB 1937


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            This bill requires that an IOU's procurement plan make several  
            additional showings, each related to the IOU's procurement of  
            new natural-gas-fired generation resources.  Specifically,  
            this bill requires the procurement plan to newly show that the  
            IOU will:


             a)   Actively seek bids for resources that are not gas-fired  
               generation resources located in communities that suffer  
               from cumulative pollution burdens, including, but not  
               limited to, high emission levels of toxic air contaminants,  
               criteria air pollutants, and greenhouse gases (GHGs).


             b)   In considering bids for, or negotiating contracts for,  
               new gas-fired generation resources, provide greater  
               preference to resources that are not gas-fired generation  
               resources located in communities that suffer from  
               cumulative pollution burdens, including, but not limited  
               to, high emission levels of toxic air contaminants,  
               criteria air pollutants, and GHGs.


             c)   Undertake all feasible efforts to meet any identified  
               resource need through available renewable energy, energy  
               storage, energy efficiency, and demand reduction resources  
               that are cost-effective, reliable, and feasible.


          Analysis Prepared by:                                             
                          Sue Kateley / U. & C. / (916) 319-2083  FN:  
          0004525

















                                                                    AB 1937


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