BILL ANALYSIS Ó
SB 350
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Date of Hearing: August 19, 2015
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Jimmy Gomez, Chair
SB 350
(De León) - As Amended July 16, 2015
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| |Natural Resources | |6 - 2 |
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Urgency: No State Mandated Local Program: YesReimbursable:
No
SUMMARY:
This bill establishes the Clean Energy and Pollution Reduction
Act of 2015 to direct a 50% reduction in motor vehicle petroleum
use, a 50% increase sales of renewable electricity, and a
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doubling of the energy efficiency in buildings, all to be
achieved by 2030.
FISCAL EFFECT:
1)Ongoing annual costs of $5.6 million for staffing and one-time
costs of $3.5 million in contracts (GF and special fund) for
the California Energy Commission (CEC) to implement the
requirements of the bill.
2)Ongoing annual costs of $1.65 million for personnel services
and $2.3 million in operating expenses (special fund) for the
Public Utilities Commission (PUC) to fulfill the requirements
of the bill.
3)Ongoing annual costs of up to $1.25 million (various special
funds) for the Air Resources Board (ARB) to implement the
petroleum reduction goal.
4)Ongoing annual costs of up to $275,000 (various special funds)
for ARB to develop policies to remove regulatory disincentives
and facilitate Green House Gas (GHG) reductions through
transportation electrification.
5)Unknown costs pressures to current programs from various
special funds to achieve a 50% petroleum reduction.
6)Unknown ratepayer costs to the GF and various special funds to
the state, as an electricity user and ratepayer to the extent
electricity prices are affected by increasing the RPS
standard.
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7)Unknown costs pressures (special fund) for the PUC and CEC to
review renewable integration needs and consider grid
integration in RPS implementation proceedings.
COMMENTS:
1)Purpose. According to the author, this bill enacts policies
that build on our economic growth by strengthening incentives
for energy efficiency and clean energy technology. The Golden
State Standards are as follows:
50% less petroleum use;
50% of electricity coming from renewable sources; and
50% better efficiency in our buildings.
The author contends these standards will send a strong signal
to California's businesses and drive innovation and investment
resulting in more jobs and state revenue.
This bill codifies goals announced by the Governor in January
in his inaugural address.
2)Background. Current law requires the ARB to adopt and
implement motor vehicle emission standards, in-use performance
standards, and motor vehicle fuel specifications for the
control of air contaminants and sources of air pollution.
The CEC is required to develop and implement a comprehensive
program to achieve greater energy savings in California's
existing residential and nonresidential building stock.
All retail sellers of electricity - investor-owned utilities
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(IOU), community choice aggregators (CCAs), and energy service
providers (ESPs) - and publicly-owned utilities (POU) are
required to increase purchases of renewable energy such that
at least 33 percent of retail sales are procured from
renewable energy resources by December 31, 2020. This is known
as the Renewable Portfolio Standard (RPS). The PUC is
explicitly authorized to require retail sellers of electricity
to procure renewable energy resources in excess of the
33-percent RPS requirement. The PUC oversees RPS compliance
with IOUs while the CEC oversees POUs.
Existing law also establishes the Electric Program Investment
Charge (EPIC) Fund, to fund projects that benefit electricity
ratepayers and lead to technological advancement and
breakthroughs to overcome the barriers that prevent the
achievement of the state's statutory energy goals.
3)Stakeholder Discussions Continue. The author's office
continues to regularly meet with the numerous stakeholder
groups on the detailed provisions of this bill. Topics under
discussion include but are not limited to: 1) addressing RPS
concerns of small publicly owned utilities; 2) revisions to
transportation electrification provisions; 3) revisions to the
existing RPS framework; 4) ensuring the fair treatment of all
retail sellers in RPS enforcement; 5) revising provisions
within the existing RPS regarding banking, and short and long
term contracts; and 6) adjustments to the petroleum reduction
provisions.
Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081
SB 350
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