BILL ANALYSIS                                                                                                                                                                                                    

                                                                    AB 2861

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          Date of Hearing:  May 18, 2016


                               Lorena Gonzalez, Chair

          2861 (Ting) - As Amended April 27, 2016

          |Policy       |Utilities and Commerce         |Vote:|14 - 0       |
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          Urgency:  No  State Mandated Local Program:  NoReimbursable:  No


          This bill authorizes the California Public Utilities Commission  
          (PUC) to establish an expedited distribution grid  
          interconnection dispute resolution process to resolve disputes  
          within 60 days, unless it determines more time is needed.  This  
          bill specifies the elements to be included in in the dispute  
          resolution process and requires the PUC to establish a technical  
          advisory panel, a review panel, and a public process for each  


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          FISCAL EFFECT:

          If the PUC opted to establish the expedited dispute process, it  
          would likely require an additional $550,000, seven staff  
          positions and $300,000 in contracts. (PUC Utilities Fund.) 


          1)Purpose.  According to the author, this bill expedites the  
            process of connecting more energy storage to a utility's  
            electric grid, which in turn means more renewable energy can  
            be obtained. 

          2)Distribution Grid Interconnection Disputes.  Investor-owned  
            utilities (IOUs) own the distribution grid, that is, the  
            utility lines that serve local areas.   The interconnection is  
            the physical connection between a generator and the grid.   
            Disputes arise when the utility who owns, manages and  
            maintains the grid won't connect generation projects.  A  
            typical dispute occurs when the utility requires system  
            improvements for safety purposes and the generator may object  
            to some or all of the costs of the improvements.

            The PUC currently has an Alternative Dispute Resolution (ADR)  
            process in its interconnection rules. The process first  
            provides a structure for bilateral negotiations then directs  
            unresolved disputes to the ADR process, which includes an  
            administrative law judge, and provides a dispute resolution  
            process for all utility service provisions within the PUC's  
            jurisdiction.  According to the PUC, the ADR process has  


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            rarely if ever been used for distribution grid interconnection  
            disputes.  Instead, generators complain to PUC Energy division  
            staff who lack the engineering expertise and authority to  
            intervene.  The PUC reports that in the last year, the Energy  
            Division has received 20-30 informal request for assistance  
            with interconnection disputes.

            This bill provides an expedited dispute process through  
            technical advisory and review panels.

          Analysis Prepared by:Jennifer Galehouse / APPR. / (916)