BILL ANALYSIS Ó
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|SENATE RULES COMMITTEE | AB 2861|
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THIRD READING
Bill No: AB 2861
Author: Ting (D)
Amended: 8/1/16 in Senate
Vote: 21
SENATE ENERGY, U. & C. COMMITTEE: 9-0, 6/27/16
AYES: Hueso, Morrell, Cannella, Gaines, Hertzberg, Hill, Lara,
Leyva, McGuire
NO VOTE RECORDED: Pavley, Wolk
SENATE APPROPRIATIONS COMMITTEE: 7-0, 8/11/16
AYES: Lara, Bates, Beall, Hill, McGuire, Mendoza, Nielsen
ASSEMBLY FLOOR: 80-0, 5/31/16 - See last page for vote
SUBJECT: Electricity: distribution grid interconnection
dispute resolution process
SOURCE: California Public Utilities Commission
DIGEST: This bill authorizes the creation of an expedited
dispute resolution process for distributed generation energy
resources attempting to establish a connection to an
investor-owned utility's (IOU's) electricity transmission and
distribution network.
ANALYSIS:
Existing law:
1)Defines "distributed resources" to means distributed renewable
generation resources, energy efficiency, energy storage,
electric vehicles, and demand response technologies.
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2)Requires each IOU to submit to the California Public Utilities
Commission (CPUC) for its approval or modification a
distribution resources plan proposal to identify optimal
locations for the deployment of distributed resources. (Public
Utilities Code §769)
This bill:
1)Authorizes the CPUC to establish an expedited dispute
resolution process with the goal of resolving disputes over
interconnection applications in no more than 60 days from the
time the dispute is formally brought to the CPUC.
2)Requires the dispute resolution process to have the certain
elements, including a distribution grid interconnection
technical panel (DGITP) of at least eight members selected by
the CPUC, four of whom are from IOUs and four of whom are not,
and are restricted from participating in the dispute
resolution process for an interconnection application for
which the member has certain defined conflicts.
3)Specifies that a review panel of four members shall be
selected from the DGITP for each dispute.
4)Directs CPUC to establish a public process in which interested
parties to the dispute may file comments with the CPUC.
5)Directs each review panel to a dispute to make recommendations
to the Executive Director of the CPUC, who has 30 days to
review the recommendation and issue an order to the IOU.
6)Establishes a process for an interested person to appeal a
decision by the dispute resolution panel to the commission of
the CPUC for resolution.
7)Directs the CPUC to provide DGITP members that are not from
IOUs with an appropriate per diem compensation.
8)Requires the CPUC to appoint a qualified electrical systems
engineer with substantial interconnection expertise to advise
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the director of the energy division and to provide adequate
commission staff to assist in resolving interconnection
disputes.
Background
CPUC's Rule 21 and the Alternative Dispute Resolution Process.
Electric Rule 21 is a tariff that describes the interconnection,
operating and metering requirements for generation facilities to
be connected to an IOU's distribution system, over which the
CPUC has jurisdiction. Section K of Rule 21 establishes a
dispute resolution process that first provides a structure for
bilateral negotiations between representatives of a generation
facility and the IOU, and then directs unresolved disputes to
the CPUC's Alternative Dispute Resolution (ADR) process.
According to the CPUC, the ADR process is administered by the
CPUC's Administrative Law Judge (ALJ) Division. The CPUC does
not have data on how many interconnection disputes have gone
through the ADR process. However, the CPUC describes the
process as rarely, if ever, having been used by interconnection
applicants. The CPUC attribute this lack to the time and cost
of the ADR process. The CPUC reports that, instead of the ADR
process, developers often raise complaints with CPUC's Energy
Division staff, who lack the engineering expertise and
decision-making authority to effectively intervene in
interconnection disputes.
This bill would create an expedited distribution grid
interconnection dispute resolution process. This bill seeks to
create a forum by which interconnection disputes between a
generator and an IOU can be resolved quickly and fairly. To
that end, this bill authorizes the CPUC to establish an
expedited distribution grid interconnection dispute resolution
process with the goal of resolving disputes over interconnection
applications that are within the jurisdiction of the CPUC in no
more than 60 days from the time the dispute is formally brought
to the commission. The idea was proposed as part of last year's
Budget Act but did not appear in the final version of the act.
If the CPUC chooses to adopt the process, this bill prescribes
certain features and procedures that must be part of the
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process. Generally, the process would function as follows:
The CPUC would establish a DGITP of at least eight members,
four of whom work for and IOU and four of whom do not.
An applicant for interconnection who is unable to resolve a
dispute with an IOU may file with the CPUC for expedited
dispute resolution.
The CPUC would ensure that a review panel - a four-member body
chosen from the DGITP, reviews the dispute via a public
process and makes a recommendation to the executive director
of the CPUC within 30 days of receiving the dispute.
The CPUC executive director would have 30 days to review the
recommendation and to prepare an order to the IOU resolving
the dispute.
The process would provide for alternate decisions by each member
of a review panel, appeal to the full commission of decisions by
the executive director, and per diem for the member of a panel
who do not work for an IOU.
The CPUC reports that, if this bill becomes law, the expedited
interconnection dispute resolution process would likely replace
the dormant ADR Process.
It is unknown whether the process this bill would allow to be
established would allow disputes between generators and IOUs to
be resolved more quickly or to a greater degree of general
satisfaction. Many details of implementation are left to the
CPUC. However, stakeholders seem to believe it might help:
this bill is supported by many generators and the CPUC and is
not opposed by any party, including any IOU.
Prior/Related Legislation
SB 106 (Budget and Fiscal Review Committee, 2015) included a
proposal to create a similar dispute resolution process. The
bill is pending on the Senate Inactive File.
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FISCAL EFFECT: Appropriation: No Fiscal
Com.:YesLocal: No
According to the Senate Appropriations Committee, approximately
$731,000 (Utilities Reimbursement Account) to the CPUC for staff
necessary to develop and implement the expedited distribution
grid interconnection dispute resolution process.
SUPPORT: (Verified8/12/16)
California Public Utilities Commission (source)
California Energy Storage Alliance
California Solar Energy Industries Association
OutBack Power Technologies
Powertree Services Inc.
Solar Energy Industries Association
SolarCity
OPPOSITION: (Verified8/12/16)
None received
ARGUMENTS IN SUPPORT: According to the author:
Interconnection requests have grown dramatically in
California. Electrical corporations and the CPUC have worked
to ensure timely processing of interconnection applications.
However, when a dispute arises between an existing electricity
provider (which owns the distribution grid) and a renewable
energy or energy storage developer attempting to connect to
the grid, projects are unnecessarily delayed or come to a
halt.
Examples of disputes include wildly differing fee estimates
for interconnection upgrades, unreasonable response timeframes
from utilities, excessive needs for meetings and re-submittals
of materials.
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Just as the electrical corporation oversees the
interconnection processes, the same corporation handles the
disputes. This structure has unduly limited the ability to
get an independent review of disputes.
The technical nature of interconnections - dealing with
electrical engineering, circuitry protection 'schemes',
metering configurations, and system upgrades (such as new
electrical equipment costs) - render the decision-making of
the electrical corporation incoherent to most interconnection
applicants. Additionally, the lack of independence in the
current process, where disputes are escalated within the
electrical corporation, may not provide sufficient
independence in the review of disputes.
AB 2861 establishes a technical advisory panel to review
disputes and to provide recommendations to the CPUC on dispute
resolution. Ultimately, the CPUC has the final
decision-making authority to determine the appropriate
resolution.
ASSEMBLY FLOOR: 80-0, 5/31/16
AYES: Achadjian, Alejo, Travis Allen, Arambula, Atkins, Baker,
Bigelow, Bloom, Bonilla, Bonta, Brough, Brown, Burke,
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, Jones-Sawyer, 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
Prepared by:Jay Dickenson / E., U., & C. / (916) 651-4107
8/15/16 20:30:07
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