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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|ASSEMBLY: |51-26 |(May 23, 2016) |SENATE: |26-13 |(August 22, |
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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.
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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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