Amended in Assembly March 18, 2016

California Legislature—2015–16 Regular Session

Assembly BillNo. 2620

Introduced by Assembly Member Dababneh

February 19, 2016

An act tobegin delete amendend deletebegin insert addend insert Sectionbegin delete 701.1 ofend deletebegin insert 99684.5 toend insert the Public Utilities Code, relating tobegin delete energy.end deletebegin insert transportation, and making an appropriation therefor.end insert


AB 2620, as amended, Dababneh. begin deleteValuation of energy resources.end deletebegin insertPassenger rail projects: funding.end insert

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Proposition 116, an initiative measure, enacted the Clean Air and Transportation Improvement Act of 1990, which establishes the Clean Air and Transportation Improvement Fund, allocates specified amounts from the fund for, among other things, rights-of-way for rail purposes and capital expenditures deemed necessary for a specified rail service, and requires the California Transportation Commission to adopt guidelines for the approval of grants for transit projects which are essential to the implementation of safe and reliable transit services.

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The act authorizes, if any of the funds are not expended or encumbered prior to July 1, 2010, the Legislature to reallocate the funds for any other passenger rail project in the state by a statute passed in each house by a 23 vote.

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This bill would reallocate funds allocated pursuant to the act that are not expended or encumbered by July 1, 2020, to any other existing passenger rail project in the state. The bill would require the commission to determine the existing passenger rail projects in the state and implement the reallocation on a pro-rata basis. By reallocating unexpended or unencumbered funds to any other existing passenger rail project, the bill would make an appropriation.

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Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations and gas corporations. The Public Utilities Act prohibits any electrical corporation or gas corporation from beginning the construction of, among other things, a line, plant, or system, or of any extension thereof, without having first obtained from the commission a certificate that the present or future public convenience and necessity require or will require that construction. The act requires the commission, when calculating the cost-effectiveness of energy resources, to include a value for any costs and benefits to the environment.

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This bill would make a nonsubstantive, revision to the requirement that the commission, when calculating the cost-effectiveness of energy resources, include a value for any costs and benefits to the environment.

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Vote: begin deletemajority end deletebegin insert23end insert. Appropriation: begin deleteno end deletebegin insertyesend insert. Fiscal committee: begin deleteno end deletebegin insertyesend insert. State-mandated local program: no.

The people of the State of California do enact as follows:

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begin insertSECTION end insertbegin insert1end insertbegin insert.end insert  

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begin insertSection 99684.5 is added to the end insertbegin insertPublic Utilities
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begin insert, to read:end insert

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begin insert99684.5.end insert  

(a) Funds allocated pursuant to this part that are
4not expended or encumbered by July 1, 2020, are hereby
5reallocated pursuant to subdivision (b) of Section 99684 to any
6other existing passenger rail project.

7(b) The California Transportation Commission shall determine
8the existing passenger rail projects in the state and implement the
9reallocation described in subdivision (a) on a pro-rata basis.

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Section 701.1 of the Public Utilities Code is
11amended to read:



(a) (1) The Legislature finds and declares that, in
13addition to other ratepayer protection objectives, a principal goal
14of electric and natural gas utilities’ resource planning and
15investment shall be to minimize the cost to society of the reliable
16energy services that are provided by natural gas and electricity,
17and to improve the environment and to encourage the diversity of
18energy sources through improvements in energy efficiency,
19development of renewable energy resources, such as wind, solar,
P3    1biomass, and geothermal energy, and widespread transportation

3(2) The amendment made to this subdivision by the Clean
4Energy and Pollution Reduction Act of 2015 (Chapter 547 of the
5Statutes of 2015) does not expand the authority of the commission
6beyond that provided by other law.

7(b) The Legislature further finds and declares that, in addition
8to any appropriate investments in energy production, electrical
9and natural gas utilities should seek to exploit all practicable and
10cost-effective conservation and improvements in the efficiency of
11energy use and distribution that offer equivalent or better system
12reliability, and which are not being exploited by any other entity.

13(c) In calculating the cost-effectiveness of energy resources,
14including conservation and load management options, the
15commission shall include, in addition to other ratepayer protection
16objectives, a value for any costs and benefits to the environment,
17including air quality. The commission shall ensure that any values
18it develops pursuant to this section are consistent with values
19developed by the State Energy Resources Conservation and
20Development Commission pursuant to Section 25000.1 of the
21Public Resources Code. However, if the commission determines
22that a value developed pursuant to this subdivision is not consistent
23with a value developed by the State Energy Resources
24Conservation and Development Commission pursuant to
25subdivision (c) of Section 25000.1 of the Public Resources Code,
26the commission may nonetheless use this value if, in the
27appropriate record of its proceedings, it states its reasons for using
28the value it has selected.

29(d) In determining the emission values associated with the
30current operating capacity of existing electric powerplants pursuant
31to subdivision (c), the commission shall adhere to the following
32protocol in determining values for air quality costs and benefits to
33the environment. If the commission finds that an air pollutant that
34is subject to regulation is a component of residual emissions from
35an electric powerplant and that the owner of that powerplant is
36either of the following:

37(1) Using a tradable emission allowance, right, or offset for that
38pollutant, which (A) has been approved by the air quality district
39regulating the powerplant, (B) is consistent with federal and state
P4    1law, and (C) has been obtained, authorized, or acquired in a
2market-based system.

3(2) Paying a tax per measured unit of that pollutant.

4The commission shall not assign a value or cost to that residual
5pollutant for the current operating capacity of that powerplant
6because the alternative protocol for dealing with the pollutant
7operates to internalize its cost for the purpose of planning for and
8acquiring new generating resources.

9(e) (1) The values determined pursuant to subdivision (c) to
10represent costs and benefits to the environment shall not be used
11by the commission, in and of themselves, to require early
12decommissioning or retirement of an electric utility powerplant
13that complies with applicable prevailing environmental regulations.

14(2) Further, the environmental values determined pursuant to
15subdivision (c) shall not be used by the commission in a manner
16which, when those values are aggregated, will result in advancing
17an electric utility’s need for new powerplant capacity by more than
1815 months.

19(f) This subdivision shall apply whenever a powerplant bid
20solicitation is required by the commission for an electric utility
21and a portion of the amount of new powerplant capacity, which is
22the subject of the bid solicitation, is the result of the commission’s
23use of environmental values to advance that electric utility’s need
24for new powerplant capacity in the manner authorized by paragraph
25(2) of subdivision (e). The affected electric utility may propose to
26the commission any combination of alternatives to that portion of
27the new powerplant capacity that is the result of the commission’s
28use of environmental values as authorized by paragraph (2) of
29subdivision (c). The commission shall approve an alternative in
30place of the new powerplant capacity if it finds all of the following:

31(1) The alternative has been approved by the relevant air quality

33(2) The alternative is consistent with federal and state law.

34(3) The alternative will result in needed system reliability for
35the electric utility at least equivalent to that which would result
36from bidding for new powerplant capacity.

37(4) The alternative will result in reducing system operating costs
38for the electric utility over those which would result from the
39process of bidding for new powerplant capacity.

P5    1(5) The alternative will result in equivalent or better
2environmental improvements at a lower cost than would result
3from bidding for new powerplant capacity.

4(g) This section does not require an electric utility to alter the
5dispatch of its powerplants for environmental purposes.

6(h) This section does not preclude an electric utility from
7submitting to the commission any combination of alternatives to
8meet a commission-identified need for new capacity, if the
9submission is otherwise authorized by the commission.

10(i) This section does not change or alter any provision of
11commission decision 92-04-045, dated April 22, 1992.

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