SB 350, as amended, De León. Clean Energy and Pollution Reduction Act of 2015.
(1) Under existing law, the Public Utilities Commission (PUC) has regulatory authority over public utilities, including electrical corporations, as defined, while local publicly owned electric utilities, as defined, are under the direction of their governing boards. Under existing law, a violation of the Public Utilities Act is a crime.end delete
Existing law establishes the California Renewables Portfolio Standard (RPS) Program, which is codified in the Public Utilities Act, with the target to increase the amount of electricity generated per year from eligible renewable energy resources to an amount that equals at least 33% of the total electricity sold to retail customers in California per year by December 31, 2020. Existing law requires the PUC, by January 1, 2012, to establish the quantity of electricity products from eligible renewable energy resources to be procured by each retail seller for specified compliance periods, sufficient to ensure that the procurement of electricity products from eligible renewable energy resources achieves 25% of retail sales by December 31, 2016, and 33% of retail sales by December 31, 2020, and that retail sellers procure not less than 33% of retail sales in all subsequent years. For these purposes, a retail seller is defined to include electrical corporations, electric service providers, and community choice aggregators. The RPS Program requires an electrical corporation to submit to the PUC, for its approval, a renewable energy procurement plan. Existing law includes as an eligible renewable energy resource a specified facility engaged in the combustion of municipal solid waste.end delete
Existing law makes the requirements of the RPS Program applicable to a local publicly owned electric utility, as defined, except that the utility’s governing board is responsible for implementation of those requirements, instead of the PUC, and certain enforcement authority with respect to local publicly owned electric utilities is given to the State Energy Resources Conservation and Development Commission (Energy Commission) and State Air Resources Board, instead of the PUC.end delete
This bill would require that the amount of electricity generated per year from eligible renewable energy resources be increased to an amount equal to at least 50% by December 31, 2030, and would require the PUC, by January 1, 2017, to establish the quantity of electricity products from eligible renewable energy resources to be procured by each retail seller for specified compliance periods sufficient to ensure that the procurement of electricity products from eligible renewable energy resources achieves 50% of retail sales by December 31, 2030. The bill would require the governing boards of local publicly owned electric utilities to ensure that specified quantities of electricity products from eligible renewable energy resources be procured for specified compliance periods to ensure that the procurement of electricity products from eligible renewable energy resources achieve 50% of retail sales by December 31, 2030. The bill would exclude all facilities engaged in the combustion of municipal solid waste from being eligible renewable energy resources. The bill would require community choice aggregators and electric service providers to prepare and submit renewable energy procurement plans. The bill would revise other aspects of the RPS Program, including, among other things, the enforcement provisions and would require penalties collected from retail sellers for noncompliance to be deposited in the Electric Program Investment Charge Fund. The bill would require the PUC to direct electrical corporations to include in their proposed procurement plans a strategy for procuring a diverse portfolio of resources that provide a reliable electricity supply. The bill would require the PUC and the Energy Commission to take certain actions in furtherance of meeting the state’s clean energy and pollution reduction objectives.end delete
This bill would authorize the PUC to authorize a procurement entity, and would authorize a local publicly owned utility, to procure an unspecified percentage of retail sales of onsite generation meeting certain requirements within the area served by the procurement entity to serve local electricity needs.end delete
Existing law requires the PUC, in cooperation with specified entities, to evaluate and implement policies to promote development of equipment and infrastructure needed to facilitate the use of electricity and natural gas to fuel low-emission vehicles. Existing law requires those policies to prohibit utilities from passing the costs and expenses related to programs for the development of that equipment or infrastructure through to ratepayers unless the PUC finds and determines that those programs are in the interest of ratepayers. Existing law defines “interests” of the ratepayers for this purpose.end delete
This bill would revise the definition of “interests” of the ratepayers. The bill would require the PUC, in consultation with specified entities, to direct electric corporations to propose multiyear programs and investments to accelerate widespread transportation electrification as a means to achieve certain goals. The bill would require the commission to review data concerning current and future electric transportation adoption rates and charging infrastructure utilization rates no less than every 3 years.end delete
Because the above provisions are codified in the Public Utilities Act, a violation of these provisions would impose a state-mandated local program by expanding the definition of a crime or establishing a new crime.end delete
By placing additional requirements upon local publicly owned electric utilities, this bill would impose a state-mandated local program.end delete
(2) Existing law requires the State Air Resources Board to adopt and implement various standards related to emissions from motor vehicles.end delete
This bill would require those standards to be in furtherance of achieving a reduction in petroleum use in motor vehicles by 50% by January 1, 2030. The bill would require the state board, by January 1, 2017, to prepare a strategy and implementation plan to achieve this reduction.end delete
Existing law requires the State Air Resources Board to adopt greenhouse gas emission limits and emissions reduction measures, by regulations, to achieve the maximum technologically feasible and cost-effective reductions in greenhouse gas emissions in furtherance of achieving the statewide greenhouse gas emissions limit. Existing law requires the state board, in adoption regulations, to, among other things, design the regulations to include distribution of emissions allowance, where appropriate, to minimize the costs and maximize total benefits to California.end delete
The Charge Ahead California Initiative states goals of, among other things, placing in service at least 1,000,000 zero-emission and near-zero-emission vehicles by January 1, 2023, and increasing access for disadvantaged, low-income, and moderate-income communities and consumers to zero-emission and near-zero-emission vehicles.end delete
This bill would require the state board to identify and adopt appropriate policies to remove regulatory disincentives facing retail sellers and local publicly owned electric utilities from facilitating the achievement of greenhouse gas emissions reduction in other sectors through increased investments in transportation and building electrification that includes allocation of greenhouse gas emissions allowances to retail sellers and local publicly owned electric utilities to account for increased greenhouse gas emissions in the electric sector from transportation electrification.end delete
(3) Existing law states the policy of the state to exploit all practicable and cost-effective conservation and improvements in the efficiency of energy use and distribution, and to achieve energy security, diversity of supply sources, and competitiveness of transportation energy markets based on the least environmental and economic costs.end delete
This bill would additionally state the policy of the state to exploit those conservation and improvements in furtherance of reducing petroleum use in the transportation sector by 50% by January 1, 2030. The bill would state the policy of the state to encourage transportation electrification to achieve ambient air quality standards and the state’s climate goals.end delete
(4) Existing law requires the Energy Commission to establish a regulatory proceeding to develop and implement a comprehensive program to achieve greater energy savings in California’s existing residential and nonresidential building stock and to periodically update criteria for the program.end delete
This bill would require the Energy Commission, by January 1, 2017, and at least once every 3 years thereafter, to adopt an update to the program in furtherance of achieving a doubling of energy efficiency in buildings by January 1, 2030. The bill would require the Energy Commission to adopt, implement, and enforce certain policy regarding ratepayer-funded energy efficiency programs.end delete
(5) 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.end delete
This bill would provide that no reimbursement is required by this act for specified reasons.end delete
Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.
The people of the State of California do enact as follows:
This act shall be known and may be cited as the
2Clean Energy and Pollution Reduction Act of 2015.
(a) The Legislature finds and declares that the
4Governor has called for a new set of objectives in clean energy,
5clean air, and pollution reduction for 2030 and beyond. Those
6objectives consist of the following:
7(1) To increase from 33 percent to 50 percent, the procurement
8of our electricity from renewable sources.
9(2) To reduce today’s petroleum use in cars and trucks by up
10to 50 percent.
11(3) To double the
begin delete efficiency of existing buildings.end delete
23 It is the intent of the Legislature in enacting this act to codify
24the targets described under subdivision (a) to ensure they are
25permanent, enforceable, and quantifiable.
Section 43013 of the Health and Safety Code is
15amended to read:
(a) The state board shall adopt and implement motor
17vehicle emission standards, in-use performance standards, and
18motor vehicle fuel specifications for the control of air contaminants
19and sources of air pollution which the state board has found to be
20necessary, cost effective, and technologically feasible, to carry out
21the purposes of this division and in furtherance of achieving a
22reduction in petroleum use in motor vehicles by 50 percent by
23January 1, 2030, unless preempted by federal law.
24(b) The state board shall, consistent with subdivision (a), adopt
25standards and regulations for light-duty and heavy-duty motor
26vehicles, medium-duty motor vehicles, as determined and specified
27by the state board, portable fuel containers and spouts, and off-road
28or nonvehicle engine categories, including, but not limited to,
29off-highway motorcycles, off-highway vehicles, construction
30equipment, farm equipment, utility engines, locomotives, and, to
31the extent permitted by federal law, marine vessels.
32(c) Prior to adopting standards and regulations for farm
33equipment, the state board shall hold a public hearing and find and
34determine that the standards and regulations are necessary, cost
35effective, and technologically feasible. The state board shall also
36consider the technological effects of emission control standards
37on the cost, fuel consumption, and performance characteristics of
38mobile farm equipment.
39(d) Notwithstanding subdivision (b), the state board shall not
40adopt any standard or regulation affecting locomotives until the
P9 1final study required under Section 5 of Chapter 1326 of the Statutes
2of 1987 has been completed and submitted to the Governor and
4(e) Prior to adopting or amending any standard or regulation
5relating to motor vehicle fuel specifications pursuant to this section,
6the state board shall, after consultation with public or private
7entities that would be significantly impacted as described in
8paragraph (2) of subdivision (f), do both of the following:
9(1) Determine the cost-effectiveness of the adoption or
10amendment of the standard or regulation. The cost-effectiveness
11shall be compared on an incremental basis with other mobile source
12control methods and options.
13(2) Based on a preponderance of scientific and engineering data
14in the record, determine the technological feasibility of the adoption
15or amendment of the standard or regulation. That determination
16shall include, but is not limited to, the availability, effectiveness,
17reliability, and safety expected of the proposed technology in an
18application that is representative of the proposed use.
19(f) Prior to adopting or amending any motor vehicle fuel
20specification pursuant to this section, the state board shall do both
21of the following:
22(1) To the extent feasible, quantitatively document the
23significant impacts of the proposed standard or specification on
24affected segments of the state’s economy. The economic analysis
25shall include, but is not limited to, the significant impacts of any
26change on motor vehicle fuel efficiency, the existing motor vehicle
27fuel distribution system, the competitive position of the affected
28segment relative to border states, and the cost to consumers.
29(2) Consult with public or private entities that would be
30significantly impacted to identify those investigative or preventive
31actions that may be necessary to ensure consumer acceptance,
32product availability, acceptable performance, and equipment
33reliability. The significantly impacted parties shall include, but are
34not limited to, fuel manufacturers, fuel distributors, independent
35marketers, vehicle manufacturers, and fuel users.
36(g) (1) No later than January 1, 2017, the state board, after one
37or more public workshops, shall prepare a strategy and
38implementation plan to achieve a reduction in petroleum use in
39motor vehicles by 50 percent by January 1, 2030, and provide a
P10 1copy of the strategy and plan to the appropriate policy committees
2of the Legislature.
4Beginning January 1, 2020, and every three years thereafter,
5the state board shall provide an update to the strategy and plan that
6reflects any changes made to the strategy and plan.
8 To the extent that there is any conflict between the
9information required to be prepared by the state board pursuant to
10subdivision (f) and information required to be prepared by the state
11board pursuant to Chapter 3.5 (commencing with Section 11340)
12of Part 1 of Division 3 of Title 2 of the Government Code, the
13requirements established under subdivision (f) shall prevail.
15 It is the intent of the Legislature that the state board act as
16expeditiously as is feasible to reduce nitrogen oxide emissions
17from diesel vehicles, marine vessels, and other categories of
18vehicular and mobile sources which significantly contribute to air
Section 44258.5 is added to the Health and Safety
30Code, to read:
(a) For the purposes of this section, the following
32terms mean the following:
33(1) “Local publicly owned electric utility” has the same meaning
34as defined in Section 224.3 of the Public Utilities Code.
35(2) “Retail seller” has the same meaning as set forth in Section
36399.12 of the Public Utilities Code.
37(3) “Transportation electrification” has the same meaning as
38set forth in Section 237.5 of the Public Utilities Code.
39(b) The state board shall identify and adopt appropriate
begin delete policiesend delete
40 to remove regulatory disincentives
begin delete facingend delete retail sellers and local publicly owned electric
2utilities from facilitating the achievement of greenhouse gas
3emission reductions in other sectors through increased investments
4in transportation electrification.
begin delete Those policiesend delete shall include, but are not limited to, an allocation of
6greenhouse gas emissions allowances to retail sellers and local
7publicly owned electric
begin delete utilitiesend delete to account for increased greenhouse gas emissions
9in the electric sector from transportation electrification.
(a) As used in this chapter, “public works” means:
12(1) Construction, alteration, demolition, installation, or repair
13work done under contract and paid for in whole or in part out of
14public funds, except work done directly by any public utility
15company pursuant to order of the Public Utilities Commission or
16other public authority. For purposes of this paragraph,
17“construction” includes work performed during the design and
18preconstruction phases of construction, including, but not limited
19to, inspection and land surveying work, and work performed during
20the postconstruction phases of construction, including, but not
21limited to, all cleanup work at the jobsite. For purposes of this
22paragraph, “installation” includes, but is not limited to, the
23assembly and disassembly of freestanding and affixed modular
25(2) Work done for irrigation, utility, reclamation, and
26improvement districts, and other districts of this type. “Public
27work” does not include the operation of the irrigation or drainage
28system of any irrigation or reclamation district, except as used in
29Section 1778 relating to retaining wages.
30(3) Street, sewer, or other improvement work done under the
31direction and supervision or by the authority of any officer or
32public body of the state, or of any political subdivision or district
33thereof, whether the political subdivision or district operates under
34a freeholder’s charter or not.
35(4) The laying of carpet done under a building lease-maintenance
36contract and paid for out of public funds.
laying of carpet in a public building done under contract
38and paid for in whole or in part out of public funds.
39(6) Public transportation demonstration projects authorized
40pursuant to Section 143 of the Streets and Highways Code.
P12 1(7) (A) Infrastructure project grants from the California
2Advanced Services Fund pursuant to Section 281 of the Public
4(B) For purposes of this paragraph, the Public Utilities
5Commission is not the awarding body or the body awarding the
6contract, as defined in Section 1722.
7(b) For purposes of this section, “paid for in whole or in part
8out of public funds” means all of the following:
9(1) The payment of money or the equivalent
of money by the
10state or political subdivision directly to or on behalf of the public
11works contractor, subcontractor, or developer.
12(2) Performance of construction work by the state or political
13subdivision in execution of the project.
14(3) Transfer by the state or political subdivision of an asset of
15value for less than fair market price.
16(4) Fees, costs, rents, insurance or bond premiums, loans, interest
17rates, or other obligations that would normally be required in the
18execution of the contract, that are paid, reduced, charged at less
19than fair market value, waived, or forgiven by the state or political
21(5) Money loaned by the state or political subdivision that is to
22be repaid on a contingent basis.
23(6) Credits that are applied by the state or political subdivision
24against repayment obligations to the state or political subdivision.
25(c) Notwithstanding subdivision (b):
26(1) Private residential projects built on private property are not
27subject to the requirements of this chapter unless the projects are
28built pursuant to an agreement with a state agency, redevelopment
29agency, or local public housing authority.
30(2) If the state or a political subdivision requires a private
31developer to perform construction, alteration, demolition,
32installation, or repair work on a public work of improvement as a
33condition of regulatory approval of an otherwise private
34development project, and the state or political subdivision
35contributes no more money, or the equivalent of money, to the
36overall project than is required to perform this public improvement
37work, and the state or political subdivision maintains no proprietary
38interest in the overall project, then only the public improvement
39work shall thereby become subject to this chapter.
P13 1(3) If the state or a political subdivision reimburses a private
2developer for costs that would normally be borne by the public,
3or provides directly or indirectly a public subsidy to a private
4development project that is de minimis in the context of the project,
5an otherwise private development project shall not thereby become
6subject to the requirements of this chapter.
7(4) The construction or rehabilitation of affordable housing units
8for low- or moderate-income persons pursuant to paragraph (5) or
9(7) of subdivision (e) of Section 33334.2 of the Health and Safety
10Code that are paid for solely with moneys from the Low and
11Moderate Income Housing Fund established pursuant to Section
1233334.3 of the Health and Safety Code or that are paid for by a
13combination of private funds and funds available pursuant to
14Section 33334.2 or 33334.3 of the Health and Safety Code do not
15constitute a project that is paid for in whole or in part out of public
17(5) Unless otherwise required by a public funding program, the
18construction or rehabilitation of privately owned residential projects
19is not subject to the requirements of this chapter if one or more of
20the following conditions are met:
21(A) The project is a self-help housing project in which no fewer
22than 500 hours of construction work associated with the homes
23are to be performed by the home buyers.
24(B) The project consists of rehabilitation or expansion work
25associated with a facility operated on a not-for-profit basis as
26temporary or transitional housing for homeless persons with a total
27project cost of less than twenty-five thousand dollars ($25,000).
28(C) Assistance is provided to a household as either mortgage
29assistance, downpayment assistance, or for the rehabilitation of a
31(D) The project consists of new construction, expansion, or
32rehabilitation work associated with a facility developed by a
33nonprofit organization to be operated on a not-for-profit basis to
34provide emergency or transitional shelter and ancillary services
35and assistance to homeless adults and children. The nonprofit
36organization operating the project shall provide, at no profit, not
37less than 50 percent of the total project cost from nonpublic
38sources, excluding real property that is transferred or leased. Total
39project cost includes the value of donated labor, materials,
40architectural, and engineering services.
P14 1(E) The public participation in the project that would otherwise
2meet the criteria of subdivision (b) is public funding in the form
3of below-market interest rate loans for a project in which
4occupancy of at least 40 percent of the units is restricted for at
5least 20 years, by deed or regulatory agreement, to individuals or
6families earning no more than 80 percent of the area median
8(d) Notwithstanding any provision of this section to the contrary,
9the following projects shall not, solely by reason of this section,
10be subject to the requirements of this chapter:
11(1) Qualified residential rental projects, as defined by Section
12142(d) of the Internal Revenue Code, financed in whole or in part
13through the issuance of bonds that receive allocation of a portion
14of the state ceiling pursuant to Chapter 11.8 (commencing with
15Section 8869.80) of Division 1 of Title 2 of the Government Code
16on or before December 31, 2003.
17(2) Single-family residential projects financed in whole or in
18part through the issuance of qualified mortgage revenue bonds or
19qualified veterans’ mortgage bonds, as defined by Section 143 of
20the Internal Revenue Code, or with mortgage credit certificates
21under a Qualified Mortgage Credit Certificate Program, as defined
22by Section 25 of the Internal Revenue Code, that receive allocation
23of a portion of the state ceiling pursuant to Chapter 11.8
24(commencing with Section 8869.80) of Division 1 of Title 2 of
25the Government Code on or before December 31, 2003.
26(3) Low-income housing projects that are allocated federal or
27state low-income housing tax credits pursuant to Section 42 of the
28Internal Revenue Code, Chapter 3.6 (commencing with Section
2950199.4) of Part 1 of Division 31 of the Health and Safety Code,
30or Section 12206, 17058, or 23610.5 of the Revenue and Taxation
31Code, on or before December 31, 2003.
37 If a statute, other than this section, or a regulation,
38a regulation adopted pursuant to this section, or an ordinance or a
39contract applies this chapter to a project, the exclusions set forth
40in subdivision (d) do not apply to that project.
P15 1(f)end delete
2 For purposes of this section, references to the Internal
3Revenue Code mean the Internal Revenue Code of 1986, as
4amended, and include the corresponding predecessor sections of
5the Internal Revenue Code of 1954, as amended.
7 The amendments made to this section by either Chapter 938
8of the Statutes of 2001 or the act adding this subdivision shall not
9be construed to preempt local ordinances requiring the payment
10of prevailing wages on housing projects.
Section 25000.5 of the Public Resources Code is
13amended to read:
(a) The Legislature finds and declares that
15overdependence on the production, marketing, and consumption
16of petroleum based fuels as an energy resource in the transportation
17sector is a threat to the energy security of the state due to
18continuing market and supply uncertainties. In addition, petroleum
19use as an energy resource contributes substantially to the following
20public health and environmental problems: air pollution, acid rain,
21global warming, and the degradation of California’s marine
22environment and fisheries.
23(b) Therefore, it is the policy of this state to fully evaluate the
24economic and environmental costs of petroleum use, and the
25economic and environmental costs of other transportation fuels
26and options, including the costs and values of environmental
27impacts, and to establish a state transportation energy policy that
28results in the least environmental and economic cost to the state.
29In pursuing the “least environmental and economic cost” strategy,
30it is the policy of the state to exploit all practicable and
31cost-effective conservation and improvements
32in the efficiency of energy use and distribution, and to achieve
33energy security, diversity of supply sources, and competitiveness
34of transportation energy markets based on the least environmental
35and economic cost,
begin delete andend delete
in furtherance of reducing petroleum use
36in the transportation sector by 50 percent by January 1, 2030.
37(c) It is also the policy of this state to minimize the economic
38and environmental costs due to the use of petroleum-based and
39other transportation fuels by state agencies. In implementing a
40least-cost economic and environmental strategy for state fleets, it
P16 1is the policy of the state to implement practicable and cost-effective
2measures, including, but not necessarily limited to, the purchase
3of the cleanest and most efficient automobiles and replacement
4tires, the use of alternative fuels in its fleets, and other conservation
6(d) For the purposes of this section, “petroleum based fuels”
7means fuels derived from liquid unrefined crude oil, including
8natural gas liquids, liquefied petroleum gas, or the energy fraction
9of methyl tertiary-butyl ether (MTBE) or other ethers that is not
10attributed to natural gas.
begin deleteOn end delete
33or before November 1, 2007, and by November 1 of
34every third year thereafter, the commission in consultation with
35the Public Utilities Commission and local publicly owned electric
36utilities, in a public process that allows input from other
37stakeholders, shall develop a statewide estimate of all potentially
38achievable cost-effective electricity and natural gas efficiency
39savings and establish targets for statewide annual energy efficiency
40savings and demand reduction for the next 10-year period. The
P17 1commission shall base its estimate at least in part on information
2developed pursuant to Sections 454.55, 454.56, 715, 9615,
3and 9615.5 of the Public Utilities Code. The commission shall,
4for each electrical corporation and each gas corporation, include
5in the integrated energy policy report, a comparison of the public
6utility’s annual targets established pursuant to Sections 454.55 and
7454.56, and the public utility’s actual energy efficiency savings
8and demand reductions.
Section 25943 of the Public Resources Code is
19amended to read:
(a) (1) By March 1, 2010, the commission shall
21establish a regulatory proceeding to develop and implement a
22comprehensive program to achieve greater energy savings in
23California’s existing residential and nonresidential building stock.
24This program shall comprise a complementary portfolio of
25techniques, applications, and practices that will achieve greater
26energy efficiency in existing residential and nonresidential
27structures that fall significantly below the current standards in Title
2824 of the California Code of Regulations, as determined by the
30(2) The comprehensive program may include, but need not be
31limited to, a broad range of energy assessments, building
32benchmarking, energy rating, cost-effective energy efficiency
33 improvements, public and private sector energy efficiency
34financing options, public outreach and education efforts, and green
36(3) The commission shall adopt, implement, and enforce a
37responsible contractor policy for use across all ratepayer-funded
38energy efficiency programs that involve installation or
39maintenance, or both installation and maintenance, by building
40contractors to ensure that retrofits meet high-quality performance
P21 1standards and reduce energy savings lost or foregone due to
develop and implement the program specified in
7subdivision (a), the commission shall do both of the following:
8(1) Coordinate with the Public Utilities Commission and consult
9with representatives from the Bureau of Real Estate, the
10Department of Housing and Community Development,
11investor-owned and publicly owned utilities, local governments,
12real estate licensees, commercial and homebuilders, commercial
13property owners, small businesses, mortgage lenders, financial
14institutions, home appraisers, inspectors, energy rating
15organizations, consumer groups, environmental and environmental
16justice groups, and other entities the commission deems
18(2) Hold at least three public hearings in geographically diverse
19locations throughout the state.
20(c) In developing the requirements for the program specified in
21 subdivision (a), the commission shall consider all of the following:
22(1) The amount of annual and peak energy savings, greenhouse
23gas emission reductions, and projected customer utility bill savings
24that will accrue from the program.
25(2) The most cost-effective means and reasonable timeframes
26to achieve the goals of the program.
27(3) The various climatic zones within the state.
28(4) An appropriate method to inform and educate the public
29about the need for, benefits of, and environmental impacts of, the
30comprehensive energy efficiency program.
31(5) The most effective way to report the energy assessment
32results and the corresponding energy efficiency improvements to
33the owner of the residential or nonresidential building, including,
34among other things, the following:
35(A) Prioritizing the identified energy efficiency improvements.
36(B) The payback period or cost-effectiveness of each
38(C) The various incentives, loans, grants, and rebates offered
39to finance the improvements.
40(D) Available financing options including all of the following:
P22 1(i) Mortgages or sales agreement components.
2(ii) On-bill financing.
3(iii) Contractual property tax assessments.
4(iv) Home warranties.
5(6) Existing statutory and regulatory requirements to achieve
6energy efficiency savings and greenhouse gas emission reductions.
7(7) A broad range of implementation approaches, including both
8utility and nonutility administration of energy efficiency
begin delete programs.end delete
17 Any other considerations deemed appropriate by the
19(d) The program developed pursuant to this section shall do all
20of the following:
21(1) Minimize the overall costs of establishing and implementing
22the comprehensive energy efficiency program requirements.
23(2) Ensure, for residential buildings, that the energy efficiency
24 assessments, ratings, or improvements do not unreasonably or
25unnecessarily affect the home purchasing process or the ability of
26individuals to rent housing. A transfer of property subject to the
27program implemented pursuant to this section shall not be
28invalidated solely because of the failure of a person to comply
29with a provision of the program.
30(3) Ensure, for nonresidential buildings, that the energy
31improvements do not have an undue economic impact on California
33(4) Determine, for residential buildings, the appropriateness of
34the Home Energy Rating System (HERS) program to support the
35goals of this section and whether there are a sufficient number of
36HERS-certified raters available to meet the program requirements.
37(5) Determine, for nonresidential structures, the availability of
38an appropriate cost-effective energy efficiency assessment system
39and whether there are a sufficient number of certified raters or
40auditors available to meet the program requirements.
P23 1(6) Coordinate with the California Workforce Investment Board,
2the Employment Training Panel, the California Community
3Colleges, and other entities to ensure a qualified, well-trained
4workforce is available to implement the program requirements.
15 Coordinate with, and avoid duplication of, existing
16proceedings of the Public Utilities Commission and programs
17administered by utilities.
18(e) A home energy rating or energy assessment service does not
19meet the requirements of this section unless the service has been
20certified by the commission to be in compliance with the program
21criteria developed pursuant to this section and is in conformity
22with other applicable elements of the program.
23(f) (1) The commission shall periodically update the criteria
24and adopt any revision that, in its judgment, is necessary to improve
25or refine program requirements after receiving public input.
26(2) On or before January 1, 2017, and at least once every three
27years thereafter, the commission shall adopt an update to the
28program in furtherance of achieving
begin delete an overall doubling of the by January 1, 2030.
29energy efficiency of buildingsend delete
32(g) Before implementing an element of the program developed
33pursuant to subdivision (a) that requires the expansion of statutory
34authority of the commission or the Public Utilities Commission,
35the commission and the Public Utilities Commission shall obtain
36legislative approval for the expansion of their authorities.
37(h) The commission shall report on the status of the program in
38the integrated energy policy report pursuant to Section 25302.
39(i) The commission shall fund activities undertaken pursuant
40to this section from the Federal Trust Fund consistent with the
P24 1federal American Recovery and Reinvestment Act of 2009 (Public
2Law 111-5) or other sources of nonstate funds available to the
3commission for the purposes of this section.
4(j) For purposes of this section, the following terms mean the
6(1) “Energy assessment” means a determination of an energy
7user’s energy consumption level, relative efficiency compared to
8other users, and opportunities to achieve greater efficiency or
9improve energy resource utilization.
10(2) “Energy efficiency” means delivering equal or more services
11with less energy input from an energy source.
Section 237.5 is added to the Public Utilities Code,
“Transportation electrification” means the use of
begin delete the electrical grid to powerend delete all or part of
18vehicles, vessels, trains, boats, or other equipment that are mobile
19sources of air pollution and greenhouse
begin delete gases.end delete
(a) (1) In order to ensure that prudent investments in
17energy efficiency continue to be made that produce cost-effective
18energy savings, reduce customer demand, and contribute to the
19safe and reliable operation of the electric distribution grid, it is the
20policy of this state and the intent of the Legislature that the
21commission shall continue to administer cost-effective energy
22efficiency programs authorized pursuant to existing statutory
24(2) As used in this section, the term “energy efficiency” includes,
25but is not limited to, cost-effective activities to achieve peak load
26reduction that improve end-use efficiency, lower customers’ bills,
27and reduce system needs.
28(b) (1) Any rebates or incentives offered by a public utility for
29an energy efficiency improvement or installation of energy efficient
30components, equipment, or appliances in buildings shall be
31provided only if the recipient of the rebate or incentive certifies
32that the improvement or installation has complied with any
33applicable permitting requirements and, if a contractor performed
34the installation or improvement, that the contractor holds the
35appropriate license for the work performed.
36(2) This subdivision does not imply or create authority or
37responsibility, or expand existing authority or responsibility, of a
38public utility for the enforcement of the building energy and water
39efficiency standards adopted pursuant to subdivision (a) or (b) of
40Section 25402 of the Public Resources Code, or appliance
P26 1efficiency standards and certification requirements adopted
2pursuant to subdivision (c) of Section 25402 of the Public
4(c) The commission, in evaluating energy efficiency investments
5under its existing statutory authority, shall also ensure that local
6and regional interests, multifamily dwellings, and energy service
7industry capabilities are incorporated into program portfolio design
8and that local governments, community-based organizations, and
9energy efficiency service providers are encouraged to participate
10in program implementation where appropriate.
Section 399.11 of the Public Utilities Code is amended
The Legislature finds and declares all of the following:
7(a) In order to attain a target of generating 20 percent of total
8retail sales of electricity in California from eligible renewable
9energy resources by December 31, 2013, 33 percent by December
1031, 2020, and 50 percent by December 31, 2030, it is the intent of
11the Legislature that the commission and the Energy Commission
12implement the California Renewables Portfolio Standard Program
13described in this article.
14(b) Achieving the renewables portfolio standard through the
15procurement of various electricity products from eligible renewable
16energy resources is intended to provide unique benefits to
17California, including all of the following, each of which
18independently justifies the program:
19(1) Displacing fossil fuel consumption within the state.
20(2) Adding new electrical generating facilities in the
21transmission network within the Western Electricity Coordinating
22Council service area.
23(3) Reducing air pollution in the state.
24(4) Meeting the state’s climate change goals by reducing
25emissions of greenhouse gases associated with electrical generation.
26(5) Promoting stable retail rates for electric service.
27(6) Meeting the state’s need for a diversified and balanced
28energy generation portfolio.
29(7) Assistance with meeting the
state’s resource adequacy
31(8) Contributing to the safe and reliable operation of the
32electrical grid, including providing predictable electrical supply,
33voltage support, lower line losses, and congestion relief.
34(9) Implementing the state’s transmission and land use planning
35activities related to development of eligible renewable energy
37(c) The California Renewables Portfolio Standard Program is
38intended to complement the Renewable Energy Resources Program
39administered by the Energy Commission and established pursuant
P28 1to Chapter 8.6 (commencing with Section 25740) of Division 15
2of the Public Resources Code.
3(d) New and modified electric transmission facilities may be
4necessary to facilitate the state achieving its renewables portfolio
6(e) (1) Supplying electricity to California end-use customers
7that is generated by eligible renewable energy resources is
8necessary to improve California’s air quality and public health,
9and the commission shall ensure rates are just and reasonable, and
10are not significantly affected by the procurement requirements of
11this article. This electricity may be generated anywhere in the
12interconnected grid that includes many states, and areas of both
13Canada and Mexico.
14(2) This article requires generating resources located outside of
15California that are able to supply that electricity to California
16end-use customers to be treated identically to generating resources
17located within the state, without discrimination.
18(3) California electrical corporations have already
19and the commission has approved, power purchase agreements
20with eligible renewable energy resources located outside of
21California that will supply electricity to California end-use
22customers. These resources will fully count toward meeting the
23renewables portfolio standard procurement requirements.
Section 399.12 of the Public Utilities Code is amended
For purposes of this article, the following terms have
28the following meanings:
29(a) “Conduit hydroelectric facility” means a facility for the
30generation of electricity that uses only the hydroelectric potential
31of an existing pipe, ditch, flume, siphon, tunnel, canal, or other
32manmade conduit that is operated to distribute water for a
34(b) “Balancing authority” means the responsible entity that
35integrates resource plans ahead of time, maintains load-interchange
36generation balance within a balancing authority area, and supports
37interconnection frequency in real time.
38(c) “Balancing authority area” means the collection of
39generation, transmission, and loads within the metered boundaries
P29 1of the area within which the balancing authority maintains the
2electrical load-resource balance.
3(d) “California balancing authority” is a balancing authority
4with control over a balancing authority area primarily located in
5this state and operating for retail sellers and local publicly owned
6electric utilities subject to the requirements of this article and
7includes the Independent System Operator (ISO) and a local
8publicly owned electric utility operating a transmission grid that
9is not under the operational control of the ISO. A California
10balancing authority is responsible for the operation of the
11transmission grid within its metered boundaries which
begin delete may not beend delete
12 limited by the political boundaries of the State of California.
13(e) “Eligible renewable energy resource” means an electrical
14generating facility that meets the definition of a “renewable
15electrical generation facility” in Section 25741 of the Public
16Resources Code, subject to the following:
17(1) (A) An existing small hydroelectric generation facility of
1830 megawatts or less shall be eligible only if a retail seller or local
19publicly owned electric utility procured the electricity from the
20facility as of December 31, 2005. A new hydroelectric facility that
21commences generation of electricity after December 31, 2005, is
22not an eligible renewable energy resource if it will cause an adverse
23impact on instream beneficial uses or cause a change in the volume
24or timing of streamflow.
25(B) Notwithstanding subparagraph (A), a conduit hydroelectric
26facility of 30 megawatts or less that commenced operation before
27January 1, 2006, is an eligible renewable energy resource. A
28conduit hydroelectric facility of 30 megawatts or less that
29commences operation after December 31, 2005, is an eligible
30renewable energy resource so long as it does not cause an adverse
31impact on instream beneficial uses or cause a change in the volume
32or timing of streamflow.
33(C) A facility approved by the governing board of a local
34publicly owned electric utility prior to June 1, 2010, for
35procurement to satisfy renewable energy procurement obligations
36adopted pursuant to former Section 387, shall be certified as an
37eligible renewable energy resource by the Energy Commission
38pursuant to this article, if the facility is a “renewable electrical
39generation facility” as defined in Section 25741 of the Public
P30 1(D) (i) A small hydroelectric generation unit with a nameplate
2capacity not exceeding 40 megawatts that is operated as part of a
3water supply or conveyance system is an eligible renewable energy
4resource only for the retail seller or local publicly owned electric
5utility that procured the electricity from the unit as of December
631, 2005. No unit shall be eligible pursuant to this subparagraph
7if an application for certification is submitted to the Energy
8Commission after January 1, 2013. Only one retail seller or local
9publicly owned electric utility shall be deemed to have procured
10electricity from a given unit as of December 31, 2005.
11(ii) Notwithstanding clause (i), a local publicly owned electric
12utility that meets the criteria of subdivision (j) of Section 399.30
13may sell to another local publicly owned electric utility electricity
14from small hydroelectric generation units that qualify as eligible
15renewable energy resources under clause (i), and that electricity
16may be used by the local publicly owned electric utility that
17purchased the electricity to meet its renewables portfolio standard
18procurement requirements. The total of all those sales from the
19utility shall be no greater than 100,000 megawatthours of
21(iii) The amendments made to this subdivision by the act adding
22this subparagraph are intended to clarify existing law and apply
23from December 10, 2011.
24(2) (A) A facility engaged in the combustion of municipal solid
25waste shall not be considered an eligible renewable energy
27(B) Subparagraph (A) does not apply to contracts entered into
28before January 1, 2016, for the procurement of renewable energy
29resources from a facility located in Stanislaus County that was
30operational prior to September 26, 1996.
31(f) “Procure” means to acquire through ownership or contract.
32(g) “Procurement entity” means any person or corporation
33authorized by the commission to enter into contracts to procure
34eligible renewable energy resources on behalf of customers of a
35retail seller pursuant to subdivision (f) of Section 399.13.
36(h) (1) “Renewable energy credit” means a certificate of proof
37associated with the generation of electricity from an eligible
38renewable energy resource, issued through the accounting system
39established by the Energy Commission pursuant to Section 399.25,
P31 1that one unit of electricity was generated and delivered by an
2eligible renewable energy resource.
3(2) “Renewable energy credit” includes all renewable and
4environmental attributes associated with the production of
5electricity from the eligible renewable energy resource, except for
6an emissions reduction credit issued pursuant to Section 40709 of
7the Health and Safety Code and any credits or payments associated
8with the reduction of solid waste and treatment benefits created
9by the utilization of biomass or biogas fuels.
10(3) (A) Electricity generated by an eligible renewable energy
11resource attributable to the use of nonrenewable fuels, beyond a
12de minimis quantity used to generate electricity in the same process
13through which the facility converts renewable fuel to electricity,
14shall not result in the creation of a renewable energy credit. The
15Energy Commission shall set the de minimis quantity of
16nonrenewable fuels for each renewable energy technology at a
17 level of no more than 2 percent of the total quantity of fuel used
18by the technology to generate electricity. The Energy Commission
19may adjust the de minimis quantity for an individual facility, up
20to a maximum of 5 percent, if it finds that all of the following
21conditions are met:
22(i) The facility demonstrates that the higher quantity of
23nonrenewable fuel will lead to an increase in generation from the
24eligible renewable energy facility that is significantly greater than
25generation from the nonrenewable fuel alone.
26(ii) The facility demonstrates that the higher quantity of
27nonrenewable fuels will reduce the variability of its electrical
28output in a manner that results in net environmental benefits to the
30(iii) The higher quantity of nonrenewable fuel is limited to either
31natural gas or hydrogen derived by reformation of a fossil fuel.
32(B) Electricity generated by a small hydroelectric generation
33facility shall not result in the creation of a renewable energy credit
34unless the facility meets the requirements of subparagraph (A) or
35(D) of paragraph (1) of subdivision (e).
36(C) Electricity generated by a conduit hydroelectric generation
37facility shall not result in the creation of a renewable energy credit
38unless the facility meets the requirements of subparagraph (B) of
39paragraph (1) of subdivision (e).
P32 1(D) Electricity generated by a facility engaged in the combustion
2of municipal solid waste shall not result in the creation of a
3renewable energy credit. This subparagraph does not apply to
4renewable energy credits that were generated before January 1,
52016, by a facility engaged in the combustion of municipal solid
6waste located in Stanislaus County that was operational prior to
7September 26, 1996, and sold pursuant to contacts entered into
8before January 1, 2016.
9(i) “Renewables portfolio standard” means the specified
10percentage of electricity generated by eligible renewable energy
11resources that a retail seller or a local publicly owned electric utility
12is required to procure pursuant to this article.
13(j) “Retail seller” means an entity engaged in the retail sale of
14electricity to end-use customers located within the state, including
15any of the following:
16(1) An electrical corporation, as defined in Section 218.
17(2) A community choice aggregator. A community choice
18aggregator shall participate in the renewables portfolio standard
19program subject to the same terms and conditions applicable to an
21(3) An electric service provider, as defined in Section 218.3.
22The electric service provider shall be subject to the same terms
23and conditions applicable to an electrical corporation pursuant to
24this article. This paragraph does not impair a contract entered into
25between an electric service provider and a retail customer prior to
26the suspension of direct access by the commission pursuant to
27Section 80110 of the Water Code.
28(4) “Retail seller” does not include any of the following:
29(A) A corporation or person employing cogeneration technology
30or producing electricity consistent with subdivision (b) of Section
32(B) The Department of Water Resources acting in its capacity
33pursuant to Division 27 (commencing with Section 80000) of the
35(C) A local publicly owned electric utility.
36(k) “WECC” means the Western Electricity Coordinating
37Council of the North American Electric Reliability Corporation,
38or a successor to the corporation.
Section 399.13 of the Public Utilities Code is amended
(a) (1) The commission shall direct each electrical
5corporation to annually prepare a renewable energy procurement
6plan that includes the matter in paragraph (5), to satisfy its
7obligations under the renewables portfolio standard. To the extent
8feasible, this procurement plan shall be proposed, reviewed, and
9adopted by the commission as part of, and pursuant to, a general
10procurement plan process. The commission shall require each
11electrical corporation to review and update its renewable energy
12procurement plan as it determines to be necessary. The commission
13shall require all other retail sellers to prepare and submit renewable
14energy procurement plans that address the requirements identified
15in paragraph (5).
16(2) Every electrical corporation
that owns electrical transmission
17facilities shall annually prepare, as part of the Federal Energy
18Regulatory Commission Order 890 process, and submit to the
19commission, a report identifying any electrical transmission
20facility, upgrade, or enhancement that is reasonably necessary to
21achieve the renewables portfolio standard procurement
22requirements of this article. Each report shall look forward at least
23five years and, to ensure that adequate investments are made in a
24timely manner, shall include a preliminary schedule when an
25application for a certificate of public convenience and necessity
26will be made, pursuant to Chapter 5 (commencing with Section
271001), for any electrical transmission facility identified as being
28reasonably necessary to achieve the renewable energy resources
29procurement requirements of this article. Each electrical
30corporation that owns electrical transmission facilities shall ensure
31that project-specific interconnection studies are completed in a
33(3) The commission shall direct each retail seller to prepare and
34submit an annual compliance report that includes all of the
36(A) The current status and progress made during the prior year
37toward procurement of eligible renewable energy resources as a
38percentage of retail sales, including, if applicable, the status of any
39necessary siting and permitting approvals from federal, state, and
40local agencies for those eligible renewable energy resources
P34 1procured by the retail seller, and the current status of compliance
2with the portfolio content requirements of subdivision (c) of
3Section 399.16, including procurement of eligible renewable energy
4resources located outside the state and within the WECC and
5unbundled renewable energy credits.
6(B) If the retail seller is an electrical corporation, the current
7status and progress made during the prior year toward construction
8of, and upgrades to, transmission and distribution facilities and
9other electrical system components it owns to interconnect eligible
10renewable energy resources and to supply the electricity generated
11by those resources to load, including the status of planning, siting,
12and permitting transmission facilities by federal, state, and local
14(C) Recommendations to remove impediments to making
15progress toward achieving the renewable energy resources
16procurement requirements established pursuant to this article.
17(4) The commission shall adopt, by rulemaking, all of the
19(A) A process that provides criteria for the rank ordering and
20selection of least-cost and best-fit eligible renewable energy
21resources to comply with the California Renewables Portfolio
22Standard Program obligations on a total cost basis.
23This process shall take into account all of the following:
24(i) Estimates of indirect costs associated with needed
26(ii) The cost impact of procuring the eligible renewable energy
27resources on the electrical corporation’s electricity portfolio.
28(iii) The viability of the project to construct and reliably operate
29the eligible renewable energy resource, including the developer’s
30experience, the feasibility of the technology used to generate
31electricity, and the risk that the facility will not be built, or that
32construction will be delayed, with the result that electricity will
33not be supplied as required by the contract.
34(iv) Workforce recruitment, training, and retention efforts,
35including the employment growth associated with the construction
36and operation of eligible renewable energy resources and goals
37for recruitment and training of women, minorities, and disabled
39(v) (I) Estimates of electrical corporation expenses resulting
40from integrating and operating eligible renewable energy resources,
P35 1including, but not limited to, any additional wholesale energy and
2capacity costs associated with integrating each eligible renewable
4(II) No later than December 31, 2015, the commission shall
5approve a methodology for determining the integration costs
6described in subclause (I).
13(B) Rules permitting retail sellers to accumulate, beginning
14January 1, 2011, excess procurement in one compliance period to
15be applied to any subsequent compliance period. The rules shall
16apply equally to all retail sellers. In determining the quantity of
17excess procurement for the applicable compliance period, the
begin delete deduct from actual procurement quantities the
19total amount of procurement associated with contracts of less than
2010 years in duration and electricity products meeting the portfolio
21content of paragraph (3) of subdivision (b) of Section 399.16.end delete
3(C) Standard terms and conditions to be used by all electrical
4corporations in contracting for eligible renewable energy resources,
5including performance requirements for renewable generators. A
6contract for the purchase of electricity generated by an eligible
7renewable energy resource, at a minimum, shall include the
8renewable energy credits associated with all electricity generation
9specified under the contract. The standard terms and conditions
10shall include the requirement that, no later than six months after
11the commission’s approval of an electricity purchase agreement
12entered into pursuant to this article, the following information
13about the agreement shall be disclosed by the commission: party
14names, resource type, project location, and project capacity.
15(D) An appropriate minimum margin of procurement above the
16minimum procurement level necessary to comply with the
17renewables portfolio standard to mitigate the risk that renewable
18projects planned or under contract are delayed or canceled. This
19paragraph does not preclude an electrical corporation from
20voluntarily proposing a margin of procurement above the
21appropriate minimum margin established by the commission.
22(5) Consistent with the goal of increasing California’s reliance
23on eligible renewable energy resources, the renewable energy
24procurement plan shall include all of the following:
25(A) An assessment of annual or multiyear portfolio supplies
26and demand to determine the optimal mix of eligible renewable
27energy resources with deliverability characteristics that may include
28peaking, dispatchable, baseload, firm, and as-available capacity.
29(B) Potential compliance delays related to the conditions
30described in paragraph (5) of subdivision (b) of Section 399.15.
31(C) A bid solicitation setting forth the need for eligible
32renewable energy resources of each deliverability characteristic,
33required online dates, and locational preferences, if any.
status update on the development schedule of all eligible
35renewable energy resources currently under contract.
36(E) Consideration of mechanisms for price adjustments
37associated with the costs of key components for eligible renewable
38energy resource projects with online dates more than 24 months
39after the date of contract execution.
P37 1(F) An assessment of the risk that an eligible renewable energy
2resource will not be built, or that construction will be delayed,
3with the result that electricity will not be delivered as required by
5(6) In soliciting and procuring eligible renewable energy
6resources, each electrical corporation shall offer contracts of no
7less than 10 years duration, unless the commission approves of a
8contract of shorter duration.
9(7) In soliciting and procuring eligible renewable energy
10resources for California-based projects, each electrical corporation
11shall give preference to renewable energy projects that provide
12environmental and economic benefits to communities afflicted
13with poverty or high unemployment, or that suffer from high
14emission levels of toxic air contaminants, criteria air pollutants,
15and greenhouse gases.
20(b) A retail seller may enter into a combination of long- and
21short-term contracts for electricity and associated renewable energy
begin delete The commission may authorize a retail seller to enter into
23a contract of less than 10 years’ duration with an eligible renewable
24energy resource, if the commission has established, for each retail
25seller, minimum quantities of eligible renewable energy resources
26to be procured through contracts of at least 10 years’ duration.end delete
31(c) The commission shall review and accept, modify, or reject
begin delete electrical
33resource procurement plan prior to the commencement of
34renewable energy procurement pursuant to this article by
begin delete an
35electrical corporation.end delete
38(d) Unless previously preapproved by the commission, an
39electrical corporation shall submit a contract for the generation of
40an eligible renewable energy resource to the commission for review
P38 1and approval consistent with an approved renewable energy
2resource procurement plan. If the commission determines that the
3bid prices are elevated due to a lack of effective competition among
4the bidders, the commission shall direct the electrical corporation
5to renegotiate the contracts or conduct a new solicitation.
6(e) If an electrical corporation fails to comply with a commission
7order adopting a renewable energy resource procurement plan, the
8commission shall exercise its authority to require compliance.
9(f) (1) The commission may authorize a procurement entity to
10enter into contracts on behalf of customers of a retail seller for
11electricity products from eligible renewable energy resources to
12satisfy the retail seller’s renewables portfolio standard procurement
13requirements. The commission shall not require any person or
14corporation to act as a procurement entity or require any party to
15purchase eligible renewable energy resources from a procurement
17(2) Subject to review and approval by the commission, the
18procurement entity shall be permitted to recover reasonable
19administrative and procurement costs through the retail rates of
20end-use customers that are served by the procurement entity and
21are directly benefiting from the procurement of eligible renewable
23(3) The commission may authorize a procurement entity to
24procure ____ percent of retail sales of onsite generation within the
25area served by the procurement entity to serve local electricity
26needs. Onsite renewable generation shall be eligible renewable
27energy resources certified by the Energy Commission pursuant to
28Section 399.25 with a tracking system described in subdivision
29(c) of Section 399.25. Estimation of energy production from onsite
30generation shall not be used to demonstrate compliance with this
32(g) Procurement and administrative costs associated with
33contracts entered into by an electrical corporation for eligible
34renewable energy resources pursuant to this article and approved
35by the commission are reasonable and prudent and shall be
36recoverable in rates.
37(h) Construction, alteration, demolition, installation, and repair
38work on an eligible renewable energy resource that receives
39production incentives pursuant to Section 25742 of the Public
40Resources Code, including work performed to qualify, receive, or
P39 1maintain production incentives, are “public works” for the purposes
2of Chapter 1 (commencing with Section 1720) of Part 7 of Division
32 of the Labor Code.
Section 399.15 of the Public Utilities Code is amended
(a) In order to fulfill unmet long-term resource needs,
8the commission shall establish a renewables portfolio standard
9requiring all retail sellers to procure a minimum quantity of
10electricity products from eligible renewable energy resources as
11a specified percentage of total kilowatthours sold to their retail
12end-use customers each compliance period to achieve the targets
13established under this article. For any retail seller procuring at least
1414 percent of retail sales from eligible renewable energy resources
15in 2010, the deficits associated with any previous renewables
16portfolio standard shall not be added to any procurement
17requirement pursuant to this article.
18(b) The commission shall implement renewables portfolio
19standard procurement requirements only as follows:
20(1) Each retail seller shall procure a minimum quantity of
21eligible renewable energy resources for each of the following
23(A) January 1, 2011, to December 31, 2013, inclusive.
24(B) January 1, 2014, to December 31, 2016, inclusive.
25(C) January 1, 2017, to December 31, 2020, inclusive.
26(D) January 1, 2021, to December 31, 2024, inclusive.
27(E) January 1, 2025, to December 31, 2027, inclusive.
28(F) January 1, 2028, to December 31, 2030, inclusive.
29(2) (A) No later than January 1, 2017, the commission shall
30establish the quantity of electricity products from eligible
31renewable energy resources to be procured by the retail seller for
32each compliance period. These quantities shall be established in
33the same manner for all retail sellers and result in the same
34percentages used to establish compliance period quantities for all
P40 1(B) In establishing quantities for the compliance period from
2January 1, 2011, to December 31, 2013, inclusive, the commission
3shall require procurement for each retail seller equal to an average
4of 20 percent of retail sales. For the following compliance periods,
5the quantities shall reflect reasonable progress in each of the
6intervening years sufficient to ensure that the procurement of
7electricity products from eligible renewable energy resources
8achieves 25 percent of retail sales by December 31, 2016, 33
9percent by December 31, 2020, 40 percent by December 31, 2024,
1045 percent by December 31, 2027, and 50 percent by December
1131, 2030. The commission shall establish appropriate multiyear
12compliance periods for all subsequent years that require retail
13sellers to procure not less than 50 percent of retail sales of
14electricity products from eligible renewable energy resources.
15(C) Retail sellers shall be obligated to procure no less than the
16quantities associated with all intervening years by the end of each
17compliance period. Retail sellers shall not be required to
18demonstrate a specific quantity of procurement for any individual
20(3) The commission may require the procurement of eligible
21renewable energy resources in excess of the quantities specified
22in paragraph (2).
23(4) Only for purposes of establishing the renewables portfolio
24standard procurement requirements of paragraph (1) and
25determining the quantities pursuant to paragraph (2), the
26commission shall include all electricity sold to retail customers by
27the Department of Water Resources pursuant to Division 27
28(commencing with Section 80000) of the Water Code in the
29calculation of retail sales by an electrical corporation.
30(5) The commission shall waive enforcement of this section if
31it finds that the retail seller has demonstrated any of the following
32conditions are beyond the control of the retail seller and will
34(A) There is inadequate transmission capacity to allow for
35sufficient electricity to be delivered from proposed eligible
36renewable energy resource projects using the current operational
37protocols of the Independent System Operator. In making its
38findings relative to the existence of this condition with respect to
39a retail seller that owns transmission lines, the commission shall
40consider both of the following:
P41 1(i) Whether the retail seller has undertaken, in a timely fashion,
2reasonable measures under its control and consistent with its
3obligations under local, state, and federal laws and regulations, to
4develop and construct new transmission lines or upgrades to
5existing lines intended to transmit electricity generated by eligible
6renewable energy resources. In determining the reasonableness of
7a retail seller’s actions, the commission shall consider the retail
8seller’s expectations for full-cost recovery for these transmission
9lines and upgrades.
10(ii) Whether the retail seller has taken all reasonable operational
11measures to maximize cost-effective deliveries of electricity from
12eligible renewable energy resources in advance of transmission
14(B) Permitting, interconnection, or other circumstances that
15delay procured eligible renewable energy resource projects, or
16there is an insufficient supply of eligible renewable energy
17resources available to the retail seller. In making a finding that this
18condition prevents timely compliance, the commission shall
19consider whether the retail seller has done all of the following:
20(i) Prudently managed portfolio risks, including relying on a
21sufficient number of viable projects.
22(ii) Sought to develop one of the following: its own eligible
23renewable energy resources, transmission to interconnect to eligible
24renewable energy resources, or energy storage used to integrate
25eligible renewable energy resources. This clause shall not require
26an electrical corporation to pursue development of eligible
27renewable energy resources pursuant to Section 399.14.
28(iii) Procured an appropriate minimum margin of procurement
29above the minimum procurement level necessary to comply with
30the renewables portfolio standard to compensate for foreseeable
31delays or insufficient supply.
32(iv) Taken reasonable measures, under the control of the retail
33seller, to procure cost-effective distributed generation and allowable
34unbundled renewable energy credits.
35(C) Unanticipated curtailment of eligible renewable
36resources if the waiver would not result in an increase in
37greenhouse gas emissions.
38(D) Unanticipated increase in retail sales due to transportation
39electrification. In making a finding that this condition prevents
P42 1timely compliance, the commission shall consider all of the
3(i) Whether transportation electrification significantly exceeded
4forecasts in that retail seller’s service territory based on the best
5and most recently available information filed with the State Air
6Resources Board, the Energy Commission, or other state agency.
7(ii) Whether the retail seller has taken reasonable measures to
8procure sufficient resources to account for unanticipated increases
9in retail sales due to transportation electrification.
10(6) If the
commission waives the compliance requirements of
11this section, the commission shall establish additional reporting
12requirements on the retail seller to demonstrate that all reasonable
13actions under the control of the retail seller are taken in each of
14the intervening years sufficient to satisfy future procurement
16(7) The commission shall not waive enforcement pursuant to
17this section, unless the retail seller demonstrates that it has taken
18all reasonable actions under its control, as set forth in paragraph
19(5), to achieve full compliance.
20(8) If a retail seller fails to procure sufficient eligible renewable
21energy resources to comply with a procurement requirement
22pursuant to paragraphs (1) and (2) and fails to obtain an order from
23the commission waiving enforcement pursuant to paragraph (5),
24the commission shall assess penalties for noncompliance. A
25schedule of penalties shall be adopted by the commission that shall
26be comparable for electrical corporations and other retail sellers.
27For electrical corporations, the cost of any penalties shall not be
28collected in rates. Any penalties collected under this article shall
29be deposited into the Electric Program Investment Charge Fund
30and used for the purposes described in Chapter 8.1 (commencing
31with Section 25710) of Division 15 of the Public Resources Code.
32(9) Deficits associated with the compliance period shall not be
33added to a future compliance period.
34(c) The commission shall establish a limitation for each electrical
35corporation on the procurement expenditures for all eligible
36renewable energy resources used to comply with the renewables
37portfolio standard. This limitation shall be set at a level that
38prevents disproportionate rate impacts.
39(d) If the cost limitation for an electrical corporation is
40insufficient to support the projected costs of meeting the
P43 1renewables portfolio standard procurement requirements, the
2electrical corporation may refrain from entering into new contracts
3or constructing facilities beyond the quantity that can be procured
4within the limitation, unless eligible renewable energy resources
5can be procured without exceeding a de minimis increase in rates,
6consistent with the long-term procurement plan established for the
7electrical corporation pursuant to Section 454.5.
8(e) (1) The commission shall monitor the status of the cost
9limitation for each electrical corporation in order to ensure
10compliance with this article.
11(2) If the commission determines that an electrical corporation
12may exceed its cost limitation prior to achieving the renewables
13portfolio standard procurement requirements, the commission shall
14do both of the following within 60 days of making that
16(A) Investigate and identify the reasons why the electrical
17corporation may exceed its annual cost limitation.
18(B) Notify the appropriate policy and fiscal committees of the
19Legislature that the electrical corporation may exceed its cost
20limitation, and include the reasons why the electrical corporation
21may exceed its cost limitation.
22(f) The establishment of a renewables portfolio standard shall
23not constitute implementation by the commission of the federal
24Public Utility Regulatory Policies Act of 1978 (Public Law
Section 399.16 of the Public Utilities Code is amended
(a) Various electricity products from eligible renewable
30energy resources located within the WECC transmission network
31service area shall be eligible to comply with the renewables
32portfolio standard procurement requirements in Section 399.15.
33These electricity products may be differentiated by their impacts
34on the operation of the grid in supplying electricity, as well as
35meeting the requirements of this article.
36(b) Consistent with the goals of procuring the least-cost and
37best-fit electricity products from eligible renewable energy
38resources that meet project viability principles adopted by the
39commission pursuant to paragraph (4) of subdivision (a) of Section
40399.13 and that provide the benefits set forth in Section 399.11, a
P44 1balanced portfolio of eligible renewable energy resources shall be
2procured consisting of the following portfolio content categories:
3(1) Eligible renewable energy resource electricity products that
4meet either of the following criteria:
5(A) Have a first point of interconnection with a California
6balancing authority, have a first point of interconnection with
7distribution facilities used to serve end users within a California
8balancing authority area, or are scheduled from the eligible
9renewable energy resource into a California balancing authority
10without substituting electricity from another source. The use of
11another source to provide real-time ancillary services required to
12maintain an hourly or subhourly import schedule into a California
13balancing authority shall be permitted, but only the fraction of the
14schedule actually generated by the eligible renewable energy
15resource shall count toward this portfolio content category.
16(B) Have an agreement to dynamically transfer electricity to a
17California balancing authority.
18(2) Firmed and shaped eligible renewable energy resource
19electricity products providing incremental electricity and scheduled
20into a California balancing authority.
21(3) Eligible renewable energy resource electricity products, or
22any fraction of the electricity generated, including unbundled
23renewable energy credits, that do not qualify under the criteria of
24paragraph (1) or (2).
25(c) In order to achieve a balanced portfolio, all retail sellers
26shall meet the following requirements for all procurement credited
27toward each compliance period:
28(1) Not less than 50 percent
for the compliance period ending
29December 31, 2013, 65 percent for the compliance period ending
30December 31, 2016, and 75 percent for
begin delete the compliance period
31ending December 31, 2020,end delete
32 of the eligible renewable energy resource electricity products
33associated with contracts executed after June 1, 2010, shall meet
34the product content requirements of paragraph (1) of subdivision
begin delete Each retail seller shall continue to satisfy the product content
36requirements applicable to procurement quantities associated with
37the compliance period ending December 31, 2020, and ensure that,
38for compliance periods ending after December 31, 2020, not less
39than 75 percent of the incremental renewable procurement
40requirements in each compliance period shall be satisfied with
P45 1eligible renewable energy resource electricity products meeting
2the requirements of paragraph (1) of subdivision (b). end delete
3(2) Not more than 25 percent for the compliance period ending
4December 31, 2013, 15 percent for the compliance period ending
5December 31, 2016, and 10 percent for
begin delete the compliance period
6ending December 31, 2020,end delete
7 of the eligible renewable energy resource electricity products
8associated with contracts executed after June 1, 2010, shall meet
9the product content requirements of paragraph (3) of subdivision
begin delete For the compliance periods ending after December 31, 2020,
11not more than 10 percent of the incremental renewable procurement
12requirements in each compliance period shall be satisfied with
13eligible renewable energy resource electricity products meeting
14the requirements of paragraph (3) of subdivision (b).end delete
15(3) Any renewable energy resources contracts executed on or
16after June 1, 2010, not subject to the limitations of paragraph (1)
17or (2), shall meet the product content requirements of paragraph
18(2) of subdivision (b).
19(4) For purposes of electric service providers only, the
20restrictions in this subdivision on crediting eligible renewable
21energy resource electricity products to each compliance period
22shall apply to contracts executed after January 13, 2011.
23(d) Any contract or ownership agreement originally executed
24prior to June 1, 2010, shall count in full toward the procurement
25requirements established pursuant to this article, if all of the
26following conditions are met:
27(1) The renewable energy resource was eligible under the rules
28in place as of the date when the contract was executed.
29(2) For an electrical corporation, the contract has been approved
30by the commission, even if that approval occurs after June 1, 2010.
31(3) Any contract amendments or modifications occurring after
32June 1, 2010, do not increase the nameplate capacity or expected
33quantities of annual generation, or substitute a different renewable
34energy resource. The duration of the contract may be extended if
35the original contract specified a procurement commitment of 15
36or more years.
37(e) A retail seller may apply to the commission for a reduction
38of a procurement content requirement of subdivision (c). The
39commission may reduce a procurement content requirement of
40subdivision (c) to the extent the retail seller demonstrates that it
P46 1cannot comply with that subdivision because of conditions beyond
2 the control of the retail seller as provided in paragraph (5) of
3subdivision (b) of Section 399.15. The commission shall not, under
4any circumstance, reduce the obligation specified in paragraph (1)
5of subdivision (c) below 65 percent for any compliance period
6obligation after December 31, 2016.
Section 399.18 of the Public Utilities Code is amended
(a) This section applies to an electrical corporation
11that as of January 1, 2010, met either of the following conditions:
12(1) Served 30,000 or fewer customer accounts in California and
13had issued at least four solicitations for eligible renewable energy
14resources prior to June 1, 2010.
15(2) Had 1,000 or fewer customer accounts in California and was
16not connected to any transmission system or to the Independent
18(b) For an electrical corporation or its successor, electricity
19products from eligible renewable energy resources may be used
20for compliance with this article, notwithstanding any procurement
21content limitation in Section 399.16, provided that all of the
22following conditions are met:
23(1) The electrical corporation or its successor participates in,
24and complies with, the accounting system administered by the
25Energy Commission pursuant to subdivision (b) of Section 399.25.
26(2) The Energy Commission verifies that the electricity
27generated by the facility is eligible to meet the requirements of
29(3) The electrical corporation continues to satisfy either of the
30conditions described in subdivision (a).
Section 399.21 of the Public Utilities Code is amended
(a) The commission, by rule, shall authorize the use
35of renewable energy credits to satisfy the renewables portfolio
36standard procurement requirements established pursuant to this
37article, subject to the following conditions:
38(1) The commission and the Energy Commission shall ensure
39that the tracking system established pursuant to subdivision (c) of
40Section 399.25, is operational, is capable of independently
P47 1verifying that electricity earning the credit is generated by an
2eligible renewable energy resource, and can ensure that renewable
3energy credits shall not be double counted by any seller of
4electricity within the service territory of the WECC.
5(2) Each renewable energy credit shall be counted
6for compliance with the renewables portfolio standard of this state
7or any other state, or for verifying retail product claims in this state
8or any other state.
9(3) All revenues received by an electrical corporation for the
10sale of a renewable energy credit shall be credited to the benefit
12(4) Renewable energy credits shall not be created for electricity
13generated pursuant to any electricity purchase contract with a retail
14seller or a local publicly owned electric utility executed before
15January 1, 2005, unless the contract contains explicit terms and
16conditions specifying the ownership or disposition of those credits.
17Procurement under those contracts shall be tracked through the
18accounting system described in subdivision (b) of Section 399.25
19and included in the quantity of eligible renewable energy resources
20of the purchasing retail seller pursuant to Section 399.15.
21(5) Renewable energy credits shall not be created for electricity
22generated under any electricity purchase contract executed after
23January 1, 2005, pursuant to the federal Public Utility Regulatory
24Policies Act of 1978 (16 U.S.C. Sec. 2601 et seq.). Procurement
25under the electricity purchase contracts shall be tracked through
26the accounting system implemented by the Energy Commission
27pursuant to subdivision (b) of Section 399.25 and count toward
28the renewables portfolio standard procurement requirements of
29the purchasing retail seller.
36 A renewable energy credit shall not be eligible for
37compliance with a renewables portfolio standard procurement
38requirement unless it is retired in the tracking system established
39pursuant to subdivision (c) of Section 399.25 by the retail seller
P48 1or local publicly owned electric utility within 36 months from the
2initial date of generation of the associated electricity.
3(b) The commission shall allow an electrical corporation to
4recover the reasonable costs of purchasing, selling, and
5administering renewable energy credit contracts in rates.
Section 399.30 of the Public Utilities Code is amended
(a) To fulfill unmet long-term generation resource
10needs, each local publicly owned electric utility shall adopt and
11implement a renewable energy resources procurement plan that
12requires the utility to procure a minimum quantity of electricity
13products from eligible renewable energy resources, including
14renewable energy credits, as a specified percentage of total
15kilowatthours sold to the utility’s retail end-use customers, each
16compliance period, to achieve the targets of subdivision (c).
22(b) The governing board shall implement procurement targets
23for a local publicly owned electric utility that require the utility to
24procure a minimum quantity of eligible renewable energy resources
25for each of the following compliance periods:
26(1) January 1, 2011, to December 31, 2013, inclusive.
27(2) January 1, 2014, to December 31, 2016, inclusive.
28(3) January 1, 2017, to December 31, 2020, inclusive.
29(4) January 1, 2021, to December 31, 2024, inclusive.
30(5) January 1, 2025, to December 31, 2027, inclusive.
31(6) January 1, 2028, to December 31, 2030, inclusive.
32(c) The governing board of a local publicly owned electric utility
33shall ensure all of the following:
34(1) The quantities of eligible renewable energy resources to be
35procured for the compliance period from January 1, 2011, to
36December 31, 2013, inclusive, are equal to an average of 20 percent
37of retail sales.
38(2) The quantities of eligible renewable energy resources to be
39procured for all other compliance periods reflect reasonable
40progress in each of the intervening years sufficient to ensure that
P49 1the procurement of electricity products from eligible renewable
2energy resources achieves 25 percent of retail sales by December
331, 2016, 33 percent by December 31, 2020, 40 percent by
4December 31, 2024, 45 percent by December 31, 2027, and 50
5percent by December 31, 2030. The Energy Commission shall
6establish appropriate multiyear compliance periods for all
7subsequent years that require the local publicly owned electric
8utility to procure not less than 50 percent of retail sales of
9electricity products from eligible renewable energy resources.
15(3) A local publicly owned electric utility shall adopt
16procurement requirements consistent with Section 399.16.
17(4) A local publicly owned electric utility may procure ____
18percent of retail sales of onsite generation within the area served
19by that utility to serve local electricity needs. Onsite renewable
20generation shall be eligible renewable energy resources certified
21by the Energy Commission pursuant to Section 399.25 with a
22tracking system described in subdivision (c) of Section 399.25.
23Estimation of energy production from onsite generation shall not
24be used to demonstrate compliance with this article.
8 The governing board of a local publicly owned electric utility
9may adopt the following measures:
10(1) Rules permitting the utility to apply excess procurement in
11one compliance period to subsequent compliance periods in the
12same manner as allowed for retail sellers pursuant to Section
15 Conditions that allow for delaying timely compliance
16consistent with subdivision (b) of Section 399.15.
18 Cost limitations for procurement expenditures consistent
19with subdivision (c) of Section 399.15.
20(e) The governing board of the local publicly owned electric
21utility shall adopt a program for the enforcement of this article.
22The program shall be adopted at a publicly noticed meeting offering
23all interested parties an opportunity to comment. Not less than 30
24days’ notice shall be given to the public of any meeting held for
25purposes of adopting the program. Not less than 10 days’ notice
26shall be given to the public before any meeting is held to make a
27substantive change to the program.
28(f) (1) Each local publicly owned electric utility shall annually
29post notice, in accordance with Chapter 9 (commencing with
30Section 54950) of Part 1 of Division 2 of Title 5 of the Government
31Code, whenever its governing body will deliberate in public on its
32renewable energy resources procurement plan.
33(2) Contemporaneous with the posting of the notice of a public
34meeting to consider the renewable energy resources procurement
35plan, the local publicly owned electric utility shall notify the
36Energy Commission of the date, time, and location of the meeting
37in order to enable the Energy Commission to post the information
38on its Internet Web site. This requirement is satisfied if the local
39publicly owned electric utility provides the uniform resource
40locator (URL) that links to this information.
P51 1(3) Upon distribution to its governing body of information
2related to its renewable energy resources procurement status and
3future plans, for its consideration at a noticed public meeting, the
4local publicly owned electric utility shall make that information
5available to the public and shall provide the Energy Commission
6with an electronic copy of the documents for posting on the Energy
7Commission’s Internet Web site. This requirement is satisfied if
8the local publicly owned electric utility provides the uniform
9resource locator (URL) that links to the documents or information
10regarding other manners of access to the documents.
11(g) A public utility district that receives all of its
12pursuant to a preference right adopted and authorized by the United
13States Congress pursuant to Section 4 of the Trinity River Division
14Act of August 12, 1955 (Public Law 84-386) shall be in compliance
15with the renewable energy procurement requirements of this article.
16(h) For a local publicly owned electric utility that was in
17existence on or before January 1, 2009, that provides retail electric
18service to 15,000 or fewer customer accounts in California, and is
19interconnected to a balancing authority located outside this state
20but within the WECC, an eligible renewable energy resource
21includes a facility that is located outside California that is
22connected to the WECC transmission system, if all of the following
23conditions are met:
24(1) The electricity generated by the facility is procured by the
25local publicly owned electric utility, is delivered to the balancing
26 authority area in which the local publicly owned electric utility is
27located, and is not used to fulfill renewable energy procurement
28requirements of other states.
29(2) The local publicly owned electric utility participates in, and
30complies with, the accounting system administered by the Energy
31Commission pursuant to this article.
32(3) The Energy Commission verifies that the electricity
33generated by the facility is eligible to meet the renewables portfolio
34standard procurement requirements.
35(i) Notwithstanding subdivision (a), for a local publicly owned
36electric utility that is a joint powers authority of districts established
37pursuant to state law on or before January 1, 2005, that furnish
38electric services other than to residential customers, and is formed
39pursuant to the Irrigation District Law (Division 11 (commencing
40with Section 20500) of the Water Code), the percentage of total
P52 1kilowatthours sold to the district’s retail end-use customers, upon
2which the renewables portfolio standard procurement requirements
3in subdivision (b) are calculated, shall be based on the authority’s
4average retail sales over the previous seven years. If the authority
5has not furnished electric service for seven years, then the
6calculation shall be based on average retail sales over the number
7of completed years during which the authority has provided electric
9(j) A local publicly owned electric utility in a city and county
10that only receives greater than 67 percent of its electricity sources
11from hydroelectric generation located within the state that it owns
12and operates, and that does not meet the definition of a “renewable
13electrical generation facility” pursuant to Section 25741 of the
14Public Resources Code, shall be required to procure eligible
15renewable energy resources, including renewable energy credits,
16to meet only the electricity demands unsatisfied by its hydroelectric
17generation in any given year, in order to satisfy its renewable
18energy procurement requirements.
19(k) (1) A local publicly owned electric utility that receives
20greater than 50 percent of its annual retail sales from its own
21hydroelectric generation that is not an eligible renewable energy
22resource shall not be required to procure additional eligible
23renewable energy resources in excess of either of the following:
24(A) The portion of its retail sales not supplied by its own
25hydroelectric generation. For these purposes, retail sales supplied
26by an increase in hydroelectric generation resulting from an
27increase in the amount of water stored by a dam because the dam
28is enlarged or otherwise modified after December 31, 2012, shall
29not count as being retail sales supplied by the utility’s own
31(B) The cost limitation adopted pursuant to this section.
32(2) For the purposes of this subdivision, “hydroelectric
33generation” means electricity generated from a hydroelectric
34facility that satisfies all of the following:
35(A) Is owned solely and operated by the local publicly owned
36electric utility as of 1967.
37(B) Serves a local publicly owned electric utility with a
38distribution system demand of less than 150 megawatts.
39(C) Involves a contract in which an electrical corporation
40receives the benefit of the electric generation through June of 2014,
P53 1at which time the benefit reverts back to the ownership and control
2 of the local publicly owned electric utility.
3(D) Has a maximum penstock flow capacity of no more than
43,200 cubic feet per second and includes a regulating reservoir
5with a small hydroelectric generation facility producing fewer than
620 megawatts with a maximum penstock flow capacity of no more
7than 3,000 cubic feet per second.
8(3) This subdivision does not reduce or eliminate any renewable
9procurement requirement for any compliance period ending prior
10to January 1, 2014.
11(4) This subdivision does not require a local publicly owned
12electric utility to purchase additional eligible renewable energy
13resources in excess of the procurement requirements of subdivision
P55 1(l)end delete
2 A local publicly owned electric utility shall retain discretion
3over both of the following:
4(1) The mix of eligible renewable energy resources procured
5by the utility and those additional generation resources procured
6by the utility for purposes of ensuring resource adequacy and
8(2) The reasonable costs incurred by the utility for eligible
9renewable energy resources owned by the utility.
11 The Energy Commission shall adopt regulations specifying
12procedures for enforcement of this article. The regulations shall
13 include a public process under which the Energy Commission may
14issue a notice of violation and correction against a local publicly
15owned electric utility for failure to comply with this article, and
16for referral of violations to the State Air Resources Board for
17penalties pursuant to subdivision (n).
19 (1) Upon a determination by the Energy Commission that
20a local publicly owned electric utility has failed to comply with
21this article, the Energy Commission shall refer the failure to comply
22with this article to the State Air Resources Board, which may
23impose penalties to enforce this article consistent with Part 6
24(commencing with Section 38580) of Division 25.5 of the Health
25and Safety Code. Any penalties imposed shall be comparable to
26those adopted by the commission for noncompliance by retail
28(2) Any penalties collected by the State Air Resources Board
29pursuant to this article shall be deposited in the Air Pollution
30Control Fund and, upon appropriation by the Legislature, shall be
31expended for reducing emissions of air pollution or greenhouse
32gases within the same geographic area as the local publicly owned
Article 17 (commencing with Section 400) is added
36to Chapter 2.3 of Part 1 of Division 1 of the Public Utilities Code,
The commission and the Energy Commission shall do all
4of the following in furtherance of meeting the state’s clean energy
5and pollution reduction objectives:
6(a) Take into account the use of distributed generation to the
7extent that it provides economic and environmental benefits in
8disadvantaged communities as identified pursuant to Section 39711
9of the Health and Safety Code.
10(b) Take into account the opportunities to decrease costs and
11increase benefits, including pollution reduction and grid integration,
12using technologies with zero onsite
begin delete greenhouse gas emissionsend delete in proceedings
15associated with meeting the objectives.
16(c) Where feasible, authorize procurement of resources to
17provide grid reliability services that minimize reliance on system
18power and fossil fuel resources and, where feasible,
begin delete cost-effective,end delete
19 and consistent with other state policy objectives,
20increase the use of large- and small-scale energy storage with a
21variety of technologies, targeted energy efficiency, demand
22response, eligible renewable energy resources, or other
24technologies with zero
begin delete greenhouse gas emissionsend delete to protect system reliability.
27(d) Review technology incentive, research, development,
28deployment, and market facilitation programs overseen by the
29commission and the Energy Commission and make
30recommendations to advance state clean energy and pollution
31reduction objectives and provide benefits to disadvantaged
32communities as identified pursuant to Section 39711 of the Health
33and Safety Code.
34(e) To the extent feasible, give first priority to the manufacture
35and deployment of clean energy and pollution reduction
36technologies that create employment opportunities, including high
37wage, highly skilled employment opportunities, and increased
38investment in the state.
39(f) Establish a publicly
available tracking system to provide
40up-to-date information on progress toward meeting the clean energy
P57 1and pollution reduction goals of the Clean Energy and Pollution
2Reduction Act of 2015.
3(g) Establish an advisory group consisting of representatives
4from disadvantaged communities identified in Section 39711 of
5the Health and Safety Code. The advisory group shall review and
6provide advice on programs proposed to achieve clean energy and
7pollution reduction and determine whether those proposed
8programs will be effective and useful in disadvantaged
Section 454.51 is added to the Public Utilities Code,
The commission shall direct each electrical corporation
14to include in its proposed procurement plan a strategy for procuring
15a diverse portfolio of resources that provide a reliable electricity
16supply, including renewable energy integration needs, using zero
17carbon-emitting resources to the maximum extent reasonable. The
18net capacity costs of those resources shall be allocated on a fully
19nonbypassable basis consistent with the treatment of costs
20identified in paragraph (2) of subdivision (c) of Section 365.1.
The commission, in consultation with the
begin delete State
12Energy Resources Conservation and Developmentend delete
13 Commission, shall identify all potentially achievable cost-effective
14electricity efficiency savings and establish efficiency targets for
15an electrical corporation to
begin delete achieveend delete pursuant to Section
begin delete 454.5.end delete
(a) The commission, in consultation with the
begin delete State
7Energy Resources Conservation and Developmentend delete
8 Commission, shall identify all potentially achievable cost-effective
9natural gas efficiency savings and establish efficiency targets for
10the gas corporation to
begin delete achieve.end delete
13(b) A gas corporation shall first meet its unmet resource needs
14through all available natural gas efficiency and demand reduction
15resources that are cost effective, reliable, and feasible.
Section 701.1 of the Public Utilities Code is amended
(a) (1) The Legislature finds and declares that, in
12addition to other ratepayer protection objectives, a principal goal
13of electric and natural gas utilities’ resource planning and
14investment shall be to minimize the cost to society of the reliable
15energy services that are provided by natural gas and electricity,
16and to improve the environment and to encourage the diversity of
17energy sources through improvements in energy
begin delete efficiency andend delete
18 development of renewable energy resources, such as
19wind, solar, biomass, geothermal energy, and widespread
21(2) The amendment made to this subdivision by the Clean
22Energy and Pollution Reduction Act of 2015 does not expand the
23authority of the commission beyond that provided by other law.
24(b) The Legislature further finds and declares that, in addition
25to any appropriate investments in energy production, electrical
26and natural gas utilities should seek to exploit all practicable and
27cost-effective conservation and improvements in the efficiency of
28energy use and distribution that offer equivalent or better system
29reliability, and which are not being exploited by any other entity.
30(c) In calculating the
begin delete cost effectivenessend delete of
31energy resources, including conservation and load management
32options, the commission shall include, in addition to other ratepayer
33protection objectives, a value for any costs and benefits to the
34environment, including air quality. The commission shall ensure
35that any values it develops pursuant to this section are consistent
36with values developed by the State Energy Resources Conservation
37and Development Commission pursuant to Section 25000.1 of the
38Public Resources Code. However, if the commission determines
39that a value developed pursuant to this subdivision is not consistent
40with a value developed by the State Energy Resources
P63 1Conservation and Development Commission pursuant to
2subdivision (c) of Section 25000.1 of the Public Resources Code,
3the commission may nonetheless use this value if, in the
4appropriate record of its proceedings, it states its reasons for using
5the value it has selected.
6(d) In determining the emission values associated with the
7current operating capacity of existing electric powerplants pursuant
8to subdivision (c), the commission shall adhere to the following
9protocol in determining values for air quality costs and benefits to
10the environment. If the commission finds that an air pollutant that
11is subject to regulation is a component of residual emissions from
12an electric powerplant and that the owner of that powerplant is
13either of the following:
14(1) Using a tradable emission allowance, right, or offset for that
15pollutant, which (A) has been approved by the air quality district
16regulating the powerplant, (B) is consistent with federal and state
17law, and (C) has been obtained, authorized, or acquired in a
19(2) Paying a tax per measured unit of that pollutant.
commission shall not assign a value or cost to that residual
21pollutant for the current operating capacity of that powerplant
22because the alternative protocol for dealing with the pollutant
23operates to internalize its cost for the purpose of planning for and
24acquiring new generating resources.
25(e) (1) The values determined pursuant to subdivision (c) to
26represent costs and benefits to the environment shall not be used
27by the commission, in and of themselves, to require early
28decommissioning or retirement of an electric utility powerplant
29that complies with applicable prevailing environmental regulations.
30(2) Further, the environmental values determined pursuant to
31subdivision (c) shall not be used by the commission in a manner
32which, when those values are aggregated, will result in advancing
33an electric utility’s need for new powerplant capacity by more than
34 15 months.
35(f) This subdivision shall apply whenever a powerplant bid
36solicitation is required by the commission for an electric utility
37and a portion of the amount of new powerplant capacity, which is
38the subject of the bid solicitation, is the result of the commission’s
39use of environmental values to advance that electric utility’s need
40for new powerplant capacity in the manner authorized by paragraph
P64 1(2) of subdivision (e). The affected electric utility may propose to
2the commission any combination of alternatives to that portion of
3the new powerplant capacity that is the result of the commission’s
4use of environmental values as authorized by paragraph (2) of
5subdivision (c). The commission shall approve an alternative in
6place of the new powerplant capacity if it finds all of the following:
7(1) The alternative has been approved by the relevant air quality
9(2) The alternative is consistent with federal and state law.
10(3) The alternative will result in needed system reliability for
11the electric utility at least equivalent to that which would result
12from bidding for new powerplant capacity.
13(4) The alternative will result in reducing system operating costs
14for the electric utility over those which would result from the
15process of bidding for new powerplant capacity.
16(5) The alternative will result in equivalent or better
17environmental improvements at a lower cost than would result
18from bidding for new powerplant capacity.
19(g) This section does not require an electric utility to alter the
20dispatch of its powerplants for environmental purposes.
21(h) This section does not preclude an electric utility from
22submitting to the commission any combination of alternatives to
23meet a commission-identified need for new capacity, if the
24submission is otherwise authorized by the commission.
25(i) This section does not change or alter any provision of
26commission decision 92-04-045, dated April 22, 1992.
Section 740.8 of the Public Utilities Code is amended
As used in Section
begin delete 740.3,end delete “interests”
31of ratepayers, short- or long-term, mean direct benefits that are
begin deleteratepayers in the form of any of the following:end delete
34(a) Safer, more reliable, or less costly gas or electrical service,
35consistent with Section
begin delete 451.end delete
39(b) More efficient use of the electric system.end delete
40(c) Improve integration of renewable energy generation.end delete
P65 1(d) Activities that both directly benefit ratepayers and that
2promote at least
3 one of the following:
4(1) Energy efficiency.end delete
6(2) Reduction of health and environmental impacts from air
8(3) Reduction of greenhouse gas emissions related to electricity
9and natural gas production and use.
10(4) Increased use of alternative fuels.
Section 740.12 is added to the Public Utilities Code,
(a) (1) The Legislature finds and declares all of the
19(A) Advanced clean vehicles and fuels are needed to reduce
20petroleum use, to meet air quality standards, to improve public
21health, and to achieve greenhouse gas emissions reduction goals.
22(B) Widespread transportation electrification is needed to
23achieve the goals of the Charge Ahead California Initiative
24(Chapter 8.5 (commencing with Section 44258) of Part 5 of
25Division 26 of the Health and Safety Code).
34 Reducing emissions of greenhouse gases to 40 percent below
351990 levels by 2030 and to 80 percent below 1990 levels by 2050
36will require widespread transportation electrification.
38 Widespread transportation electrification requires electrical
39corporations to increase access to the use of electricity as a
6 Deploying electric vehicles should assist in integrating generation from eligible renewable energy
begin delete resources and reduceend delete fuel costs for vehicle
9drivers who charge in a manner consistent with electrical grid
12 Deploying electric vehicle charging infrastructure should
13facilitate increased sales of electric vehicles by making charging
14easily accessible and should provide the opportunity to access
15electricity as a fuel that is cleaner than gasoline or
begin delete fuels.end delete
18 According to the State Alternative Fuels Plan analysis by
19the Energy Commission and the State Air Resources Board, light-,
20medium-, and heavy-duty vehicle electrification results in
21approximately 70 percent fewer greenhouse gases emitted, over
2285 percent fewer ozone-forming air pollutants emitted, and 100
23percent fewer petroleum used. These reductions will become larger
24as renewable generation increases.
25(2) It is the policy of the state and the intent of the Legislature
26to encourage transportation electrification as a means to achieve
27ambient air quality standards and the state’s climate goals.
28Agencies designing and implementing regulations, guidelines,
29plans, and funding programs to reduce greenhouse gas emissions
begin delete shouldend delete take the begin delete findingend delete described in begin delete subparagraph
31 (G) ofend delete
32(b) The commission, in consultation with the State Air Resources
33Board and the Energy Commission, shall direct electrical
begin delete propose multiyearend delete programs
35and investments to accelerate widespread transportation
36electrification to reduce dependence on petroleum, meet air quality
37standards, achieve the goals set forth in the Charge Ahead
38California Initiative (Chapter 8.5 (commencing with Section 44258)
39of Part 5 of Division 26 of the Health and Safety Code), and reduce
40emissions of greenhouse gases to 40 percent below 1990 levels by
P67 12030 and to 80 percent below 1990 levels by 2050. The commission shall
begin delete approveend delete
4 programs and investments that deploy charging
begin delete infrastructure, as distribution system costs,end delete if they are consistent with
begin delete section andend delete Section begin delete 740.3.end delete
12(c) The commission shall review data concerning current and
13future electric transportation adoption
begin delete ratesend delete
begin delete rates no less than every three years andend delete
15 prior to
begin delete any further authorization forend delete an electrical
16corporation to collect
begin delete additionalend delete new program costs related to
17transportation electrification in
begin delete ratepayerend delete rates. If market
18barriers unrelated to the investment made by an electric corporation
19prevent electric transportation from adequately utilizing available
20charging infrastructure, the commission shall not permit additional
21investments in transportation electrification without
begin delete adequate
that the investments would not
23result in stranded costs recoverable from ratepayers.
(a) By March 15, 2013, and by March 15 of each year
33thereafter, each local publicly owned electric utility shall report
34to the Energy Commission and to its customers all of the following:
35(1) Its investments in energy efficiency and demand reduction
37(2) A description of each energy efficiency and demand
38reduction program, program expenditures, cost-effectiveness
39of each program, and expected and actual energy efficiency savings
40and demand reduction results that reflect the intent of the
P68 1Legislature to encourage energy savings and reductions in
2emissions of greenhouse gases resulting from providing service
3to existing residential and nonresidential buildings, while taking
4into consideration the effect of the program on rates, reliability,
5and financial resources.
6(3) The sources for funding of its energy efficiency and demand
8(4) The methodologies and input assumptions used to determine
9the cost-effectiveness of its energy efficiency and demand reduction
15(b) By March 15, 2013, and by March 15 of every fourth year
16thereafter, each local publicly owned electric utility shall identify
17all potentially achievable cost-effective electricity efficiency
18savings and shall establish annual targets for energy efficiency
19savings and demand reduction for the next 10-year
begin delete period.end delete
A local publicly owned electric utility’s
23determination of potentially achievable cost-effective electricity
24efficiency savings shall be made without regard to previous
25minimum investments undertaken pursuant to Section 385. A local
26publicly owned electric utility shall treat investments made to
27achieve energy efficiency savings and demand reduction targets
28as procurement investments.
29(c) Within 60 days of establishing annual targets pursuant to
30subdivision (b), each local publicly owned electric utility shall
31report those targets to the Energy Commission, and the basis for
32establishing those targets.
33(d) Each local publicly owned electric utility shall make
34available to its customers and to the Energy Commission the results
35of any independent evaluation that measures and verifies the energy
36efficiency savings and the reduction in energy demand achieved
37by its energy efficiency and demand reduction programs.
(a) Each local publicly owned electric utility serving
2end-use customers, shall prudently plan for and procure resources
3that are adequate to meet its planning reserve margin and peak
4demand and operating reserves, sufficient to provide reliable
5electric service to its customers. Customer generation located on
6the customer’s site or providing electric service through
7arrangements authorized by Section 218, shall not be subject to
8these requirements if the customer generation, or the load it serves,
9meets one of the following criteria:
10(1) It takes standby service from the local publicly owned
11electric utility on a rate schedule that provides for adequate backup
12planning and operating reserves for the standby customer class.
13(2) It is not physically interconnected to the electric transmission
14or distribution grid, so that, if the customer generation fails, backup
15power is not supplied from the electricity grid.
16(3) There is physical assurance that the load served by the
17customer generation will be curtailed concurrently and
18commensurately with an outage of the customer generation.
19(b) Each local publicly owned electric utility serving end-use
20customers shall, at a minimum, meet the most recent minimum
21planning reserve and reliability criteria approved by the Board of
22Trustees of the Western Systems Coordinating Council or the
23Western Electricity Coordinating Council.
24(c) Each local publicly owned electric utility shall prudently
25plan for and procure energy storage systems that are adequate to
26meet the requirements of Section 2836.
27(d) A local publicly owned electric utility serving end-use
28customers shall, upon request, provide the Energy Commission
29with any information the Energy Commission determines is
30necessary to evaluate the progress made by the local publicly
31owned electric utility in meeting the requirements of this
begin delete section.end delete
34(e) The Energy Commission shall report to the Legislature, to
35be included in each integrated energy policy report prepared
36pursuant to Section 25302 of the Public Resources Code, regarding
37the progress made by each local publicly owned electric utility
38serving end-use customers in meeting the requirements of this
No reimbursement is required by this act pursuant to
36Section 6 of Article XIII B of the California Constitution because
37a local agency or school district has the authority to levy service
38charges, fees, or assessments sufficient to pay for the program or
39level of service mandated by this act or because costs that may be
40incurred by a local agency or school district will be incurred
P72 1because this act creates a new crime or infraction, eliminates a
2crime or infraction, or changes the penalty for a crime or infraction,
3within the meaning of Section 17556 of the Government Code, or
4changes the definition of a crime within the meaning of Section 6
5of Article XIII B of the California Constitution.