BILL ANALYSIS                                                                                                                                                                                                    Ó

                                                                     SB 350

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          350 (De León and Leno)

          As Amended July 16, 2015

          Majority vote

          SENATE VOTE:  24-14

          |Committee       |Votes|Ayes                  |Noes                |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |                |     |                      |                    |
          |Utilities       |9-5  |Rendon, Bonilla,      |Patterson,          |
          |                |     |Burke, Eggman,        |Achadjian, Hadley,  |
          |                |     |Cristina Garcia,      |Roger Hernández,    |
          |                |     |Quirk, Santiago,      |Obernolte           |
          |                |     |Ting, Williams        |                    |
          |                |     |                      |                    |
          |Natural         |6-2  |Williams, Cristina    |Hadley, Harper      |
          |Resources       |     |Garcia, McCarty,      |                    |
          |                |     |Rendon, Mark Stone,   |                    |
          |                |     |Wood                  |                    |
          |                |     |                      |                    |
          |Appropriations  |12-5 |Gomez, Bloom, Bonta,  |Bigelow, Chang,     |
          |                |     |Calderon, Nazarian,   |Gallagher, Jones,   |
          |                |     |Eggman, Eduardo       |Wagner              |
          |                |     |Garcia, Holden,       |                    |


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          |                |     |Quirk, Rendon, Weber, |                    |
          |                |     |Wood                  |                    |
          |                |     |                      |                    |
          |                |     |                      |                    |

          SUMMARY:  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  
          doubling of the energy efficiency in buildings, all to be  
          achieved by 2030.

          FISCAL EFFECT:  According to the Assembly Appropriations  

          1)Ongoing annual costs of $5.6 million for staffing and one-time  
            costs of $3.5 million in contracts (General Fund 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  
            California Public Utilities Commission (CPUC) 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 reductions through  
            transportation electrification.


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          5)Unknown costs pressures to current programs from various  
            special funds to achieve a 50% petroleum reduction.

          6)Unknown ratepayer costs to the General Fund and various  
            special funds to the state, as an electricity user and  
            ratepayer, to the extent electricity prices are affected by  
            increasing the Renewable Portfolio Standard (RPS).

          7)Unknown costs pressures (special fund) for the CPUC and CEC to  
            review renewable integration needs and consider grid  
            integration in RPS implementation proceedings.


          1)Purpose.  According to the author, this bill enacts energy  
            policies that build on California's economic growth. The  
            Golden State Standards are as follows: 

             a)   50% less petroleum use; 

             b)   50% of electricity coming from renewable sources; and

             c)   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.


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            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 and  
            administers the energy efficiency regulations for new  
            buildings and appliances.  The CPUC oversees utility energy  
            efficiency programs.

            All retail sellers of electricity - investor-owned utilities  
            (IOU), community choice aggregators, energy service providers,  
            and publicly-owned utilities (POU) - are required to increase  
            purchases of renewable energy such that at least 33% of retail  
            sales are procured from renewable energy resources by December  
            31, 2020.  This is known as the RPS.  The CPUC is explicitly  
            authorized to require retail sellers of electricity to procure  
            renewable energy resources in excess of the 33% RPS  
            requirement.  The CPUC oversees RPS compliance with IOUs while  
            the CEC oversees POUs.

            Existing law also establishes the Electric Program Investment  
            Charge 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  


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            groups on the detailed provisions of this bill.  Topics under  
            discussion include, but are not limited to:  a) addressing RPS  
            concerns of small publicly-owned utilities; b) revisions to  
            transportation electrification provisions; c) revisions to the  
            existing RPS framework; d) ensuring the fair treatment of all  
            retail sellers in RPS enforcement; e) revising provisions  
            within the existing RPS regarding banking and short- and  
            long-term contracts; f) adjustments to the energy efficiency  
            provisions; and g) adjustments to the petroleum reduction  

          Analysis Prepared by:  Sue Kateley / U. & C. / (916) 319-2083     
            FN: 0001680