BILL ANALYSIS Ó SENATE COMMITTEE ON ENERGY, UTILITIES AND COMMUNICATIONS Senator Ben Hueso, Chair 2015 - 2016 Regular Bill No: SB 502 Hearing Date: 4/7/2015 ----------------------------------------------------------------- |Author: |Leno | |-----------+-----------------------------------------------------| |Version: |2/26/2015 As Introduced | ----------------------------------------------------------------- ------------------------------------------------------------------ |Urgency: |No |Fiscal: |Yes | ------------------------------------------------------------------ ----------------------------------------------------------------- |Consultant:|Nidia Bautista | | | | ----------------------------------------------------------------- SUBJECT: San Francisco Bay Area Rapid Transit District: purchase and delivery of electricity. DIGEST: This bill will allow the San Francisco Bay Area Rapid Transit District (BART) to purchase wholesale electricity from a renewable energy resource that is eligible under California's Renewable Portfolio Standard (RPS). ANALYSIS: Existing law: 1. Requires any electric utility which owns and operates transmission and distribution facilities that deliver electricity to BART, upon request by BART, to deliver preference power purchased from a federal power marketing agency or local publicly-owned utility (POU). (Public Utilities Code §701.8) 2. Requires the electric utility to bill BART as though all the electricity purchased were metered by a single meter at one location. (Public Utilities Code §701.8) 3. Provides that any lease entered into between BART and an electrical utility, for special facilities to receive power at transmission level voltages, cannot be terminated without BART's consent. (Public Utilities Code §701.8) 4. Requires investor-owned utilities (IOUs), electric service providers, and community choice aggregators (CCA) SB 502 (Leno) Page 2 of ? to increase procurement from eligible renewable energy resources to 33 percent of total procurement by 2020. (Public Utilities Code §399.11 et seq.) 5. Requires California to reduce its greenhouse gas (GHG) emissions to 1990 levels by 2020. (Health and Safety Code §38500) Background BART is a regional light rail system that includes 104 route miles of track and 44 stations serving communities in the Bay Area region, including the counties of Alameda, Contra Costa, San Francisco, and San Mateo. BART averages nearly 400,000 weekday trips, each trip averaging a distance of 14 miles. The BART system provides nearly half of all transit passenger miles travelled in the Bay Area. BART trains are 100 percent electric. According to the "BART Green Factsheet," clean hydroelectric power and renewable resources account for 53 percent of the power BART uses. Specifically, the BART District procures electricity from a local POU, the Northern California Power Agency (NCPA), a federal agency known as the Western Area Power Administration (WAPA), a 2.5 MW solar facility through an NCPA arrangement, and net energy metered solar electric generation located at three BART facilities. BART is the cleanest transit system in the country as defined by the carbon dioxide emissions per passenger mile (based on a 2007 National Transit Database joint analysis by the Federal Transportation Agency, U.S. Department of Energy and U.S. Environmental Protection Agency). Up until the passage of SB 184 (Kopp, 1995), BART was procuring all its energy from the region's IOU, PG&E. SB 184 allowed BART to procure electricity directly from the federal power marketing authority. Under the federal Reclamation Project Act of 1939, BART qualifies as a preference entity to purchase and receive hydropower from the Central Valley Project (CVP). Additionally, SB 1838 (Kopp, 1998) exempts BART District's preference from federal power delivery from statutes and California Public Utilities Commission (CPUC) regulations governing direct access transactions related to electric power. While the bills provided for BART to diversify its sources of energy, they also require BART to compensate PG&E for the use of its transmission and distributed network under tariffs regulated by the Federal SB 502 (Leno) Page 3 of ? Energy Regulatory Commission (FERC) and the CPUC. While BART maintains the least carbon emitting transit system in the country, the BART District Board is interested in further reducing the system's carbon footprint while balancing costs that could raise fare prices. However, current law limits BART's ability to procure more renewable energy as those procurements would need to be done through a third party transaction, such as the federal power marketing authority or a local POU. Comments Has This Train Left the Station ? Prior legislation provided BART the unique opportunity to procure energy directly from sources other than the local regulated utility, while continuing to compensate the local regulated utility for the transmission and distribution costs associated with the delivery of service. SB 502 does not impact any of those prior arrangements. Instead, as currently written, the bill would merely add eligible renewable resources to the list of energy sources that can be procured by BART. Amendments: 1) The author and committee may consider amending the bill to further narrow the definition of eligible renewable energy sources to the specific definition in the state's RPS. Additional Consideration . Should this bill move forward, the author and committee may wish to ensure continued consistency with pending legislation with regards to the definition of eligible renewable energy resources. Prior/Related Legislation SB 184 (Kopp, Chapter 681, Statutes of 1995), allows BART to procure electricity directly from the federal power marketing authority. SB 1838 (Kopp, Chapter 206, Statutes of 1998), exempts BART District's preference from federal power delivery from statutes and CPUC regulations governing direct access transactions SB 502 (Leno) Page 4 of ? related to electric power. SB X1-2 (Simitian, Chapter 1, Statutes of 2011), requires all electricity retailers in the state including POUs, IOUs, electricity service providers, and CCA to adopt new RPS goals. Specifically: that 20 percent of electricity retail sales are served by renewable energy resources by 2013, 25 percent by the end of 2016 and 33 percent by 2020. AB 32 (Pavley/Nunez, Chapter 488, Statutes of 2006), California Global Warming Solutions Act requires California to reduce GHG emissions to 1990 levels by 2020. SB 350 (De León) proposes to create or expand three related clean-energy goals, including updating the state's RPS to 50 percent of total retail sales of electricity from renewable resources by 2030. FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: No SUPPORT: Clean Power Campaign Coalition for Clean Air Environment California Northern California Power Agency San Francisco Bay Area Rapid Transit District Sierra Club California Solar Energy Industries Association Union of Concerned Scientists Vote Solar OPPOSITION: None on file. ARGUMENTS IN SUPPORT: The BART Board of Directors has voted to work towards increasing the District's use of renewable energy. However, they argue that current state law limits the sources from which BART can procure renewable electricity. The author argues that SB 502 would provide BART added flexibility SB 502 (Leno) Page 5 of ? to procure additional renewable resources should it choose to do so. The author states that the existing arrangements to compensate the local regulated utility for transmission and distribution costs would be maintained. SB 502 would allow BART to contribute to the state's goals and efforts to further reduce carbon emissions. ARGUMENTS IN OPPOSITION: None on file. -- END --