AB 2868, as amended, Gatto. Energy storage.
Existing law requires the Public Utilities Commission (PUC) to determine appropriate targets, if any, for each load-serving entity to procure viable and cost-effective energy storage systems to be achieved by December 31, 2020.
This bill would require the PUC, in consultation with the State Air Resources Board and the State Energy Resources Conservation and Development Commission, to direct electrical corporations to file applications for programs and investments to accelerate widespread deployment of distributed energy storage systems, as defined. The bill would authorize the PUC to approve, or modify and approve, programs and investments in distributed energy storage systems, as provided, and would require the PUC
begin delete first approveend delete those programs and investments that provide distributed energy storage systems to begin delete industrial, commercial, school, military,end delete and low-income customers. begin delete The bill would authorize the PUC, beginning January 1, 2019, to approve programs and investments for residential customers who enroll in time-variant pricing. The bill would require that a minimum of 20% of the storage capacity in an electrical corporation’s approved programs and investments be dedicated to the benefit of public schools and military installations and would limit an electrical corporation’s total programs and investments to 5% of annual peak load, up to 250 megawatts.end delete
Because a violation of any order, decision, rule, direction, demand, or requirement of the commission implementing these requirements would be a crime, this bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.
The people of the State of California do enact as follows:
(a) The Legislature finds and declares all of the
3(1) The state, through the Public Utilities Commission, has taken
4action to promote energy storage, including setting energy storage
5procurement targets applicable for certain load-serving entities,
6totaling 1,325 megawatts, and for all other load-serving entities,
7to be met by 2020, with installations of the energy storage systems
8meeting the procurement targets by no later than the end of 2024.
9(2) Ratepayer funding is currently allowed to provide incentives
10to customers who purchase energy storage for permanent load
12(3) The Legislature reauthorized the self-generation incentive
13program to provide incentives to customers who achieve reductions
14in the emissions of greenhouse gases using technologies like energy
P3 1(4) The State Energy Resources Conservation and Development
2Commission funds research and demonstration programs to further
3the effectiveness of energy storage as an important resource to the
4electric grid through the Electric Program Investment Charge.
5(5) Federal Energy Regulatory Commission Order No. 792
6directs transmission providers to define energy storage devices as
7generating facilities, thereby enabling these resources to take
8advantage of generator interconnection procedures.
9(6) Industrial and commercial customers are subject to the
10time-of-use tariffs of the load-serving entity providing electric
11services, some of which also include demand charges. Industrial
12and commercial customers have challenges modifying their
13businesses to manage their electricity consumption and costs.
14(7) Section 745 of the Public Utilities Code authorizes the
15commission to require or authorize an electrical corporation to
16employ default time-of-use pricing for residential customers.
17(8) Changes in customer electricity usage will modify the peak
18time for electricity demand and effect demand charges in rate
20(9) Properly designed and dispatched energy
21will help customers manage energy costs, help reduce overall
22system peak energy demands, improve public health, and assist in
23achieving greenhouse gas emissions goals.
24(10) Increased demand for energy storage technologies will
25drive new business opportunities and create jobs.
26(11) Easing energy costs for large energy users will help keep
27manufacturing and industrial jobs in California.
28(b) It is the policy of the state and the intent of the Legislature
29to encourage energy storage as a means to achieve ratepayer
30benefits, ambient air quality standards, and the state’s climate
Section 2838.2 is added to the Public Utilities Code,
(a) The following definitions apply to this section:
35(1) “Distributed energy storage system” means an energy storage
36system with a useful life of at least 10 years that is located on the customer side of the
39(2) “Energy storage management system” means a system by
40which an electrical corporation can manage the charging and
P4 1discharging of the distributed energy storage system in a manner
2that provides benefits to ratepayers.
3(b) The commission, in consultation with the State Air Resources
4 Board and the Energy Commission, shall direct electrical corporations to file applications for programs
6and investments to accelerate widespread deployment of distributed
7energy storage systems to achieve ratepayer benefits, reduce
8dependence on petroleum, meet air quality standards, and reduce
9emissions of greenhouse gases. Programs and investments proposed
10by electrical corporations shall seek to
11minimize overall costs and maximize overall benefits.
12(c) (1) The commission may approve, or modify and approve,
13programs and investments of an electrical corporation in distributed
14 energy storage systems with appropriate energy storage
15management systems and reasonable mechanisms for cost
begin delete recovery
16from all distribution customers for distribution level distributed
17energy storage systems, and from transmission customers for
18transmission level distributed energy storage systems. An electrical
19corporation’s programs and investments in distributed energy
20storage systems shall not exceed 5 percent of the electrical
21corporation’s annual peak load, up to 250 megawatts.end delete
29(2) A minimum of 20 percent of the storage capacity in an
30electrical corporation’s approved programs and investments in
31 distributed energy storage systems shall be dedicated to the benefit
32of public schools and military installations. The electrical
33corporation shall allocate the benefits of this dedicated storage
34capacity to benefitting schools and military installations by
35reducing the customer’s metered demand in an amount equivalent
36to the demand served by the storage that has been dedicated to
37these customers pursuant to this section.
38(d) The commission shall approve an electrical corporation’s
39application for a program or investment in distributed energy
40storage systems if it is consistent with the requirements of this
P5 1section, does not unreasonably limit or impair the ability of
2nonutility enterprises to market and deploy energy storage systems
3to other customers, and is in the interest of ratepayers.
10 (1) The commission shall
begin delete approve, or modify and approve,end delete
11 each application filed by an electrical corporation pursuant
12to this section within 12 months of the date of filing of the
begin delete The costs associated with storage
14investments authorized by the commission shall be recoverable
15from all electricity customers on a nonbypassable basis.end delete
16(2) The commission shall
begin delete first approveend delete those programs
17and investments that provide distributed energy storage systems
begin delete industrial, commercial, school, military,end delete and
begin delete Beginning January 1, 2019, the commission
20may approve programs and investments offered to residential
21customers who enroll in time-variant pricing pursuant to Section
23(3) The commission shall ensure that the costs for the programs
24and investments are recovered through transmission, distribution,
25and generation rate components in proportion to the benefits
27(f) The commission shall not establish a separate fund for this
28program but shall allow standard cost recovery by an electrical
No reimbursement is required by this act pursuant to
40Section 6 of Article XIII B of the California Constitution because
P6 1the only costs that may be incurred by a local agency or school
2district will be incurred because this act creates a new crime or
3infraction, eliminates a crime or infraction, or changes the penalty
4for a crime or infraction, within the meaning of Section 17556 of
5the Government Code, or changes the definition of a crime within
6the meaning of Section 6 of Article XIII B of the California