BILL ANALYSIS Ó AB 2868 Page 1 (Without Reference to File) CONCURRENCE IN SENATE AMENDMENTS AB 2868 (Gatto) As Amended August 31, 2016 Majority vote -------------------------------------------------------------------- |ASSEMBLY: |51-27 |(June 1, 2016) |SENATE: |24-12 |(August 31, | | | | | | |2016) | | | | | | | | | | | | | | | -------------------------------------------------------------------- Original Committee Reference: U. & C. SUMMARY: Requires investor-owned utilities (IOUs) to file applications with the California Public Utilities Commission (CPUC) for programs and investments to accelerate the widespread deployment of distributed energy storage systems. The Senate amendments: 1)Authorize the CPUC to approve electric utility proposals and investments in distributed energy storage. 2)Specify total Megawatt (MW) limit at 500 MW, divided equally AB 2868 Page 2 among the three largest electric utilities. 3)Prioritize programs to assist public and low income customers. 4)Limit the total MW that can be installed on the customer-side-of the meter to no more than 25% of the total MW. 5)Specify that programs and investments by utilities in distributed energy storage are not to unreasonably limit or impair the ability of non-utility enterprises to market and deploy energy storage systems. FISCAL EFFECT: According to the Senate Appropriations Committee: 1)One-time costs of approximately $500,000 (Utilities Reimbursement Account) to the CPUC for a consulting budget. 2)Approximately $419,000 (Utilities Reimbursement Account) annually to the CPUC for staffing costs. 3)Minor costs to the California Air Resources Board for consultation. COMMENTS: 1)Background: Existing state programs seek to foster development and deployment of energy storage systems. AB 2514 (Skinner), Chapter 469, Statutes of 2010, statute requires the CPUC to determine appropriate targets, if any, for Load Serving Entities to procure energy storage systems by 2015 and 2020, and directed publicly owned utilities to set their own AB 2868 Page 3 comparable energy storage system procurement targets. The CPUC reports the IOUs have each progressed in meeting their energy storage procurement targets. None has yet met its final procurement goal in any category, other than Southern California Edison, which has already exceeded the procurement goal for customer-side storage. The state has also provided financial incentives to energy storage systems. Over the last several years, the CPUC reports that the Self-Generation Incentive Program (SGIP), which the CPUC administers, has awarded $42 million to nearly 1,200 energy storage projects. The CPUC is currently considering revisions to SGIP program eligibility. A CPUC staff proposal recommends reserving at least 75% of future program awards for energy storage systems. Analysis Prepared by: Sue Kateley / U. & C. / (916) 319-2083 FN: 0005041