BILL ANALYSIS Ó SENATE COMMITTEE ON APPROPRIATIONS Senator Ricardo Lara, Chair 2015 - 2016 Regular Session SB 551 (Wolk) - State water policy: water and energy efficiency. ----------------------------------------------------------------- | | | | | | ----------------------------------------------------------------- |--------------------------------+--------------------------------| | | | |Version: February 26, 2015 |Policy Vote: N.R. & W. 8 - 0 | | | | |--------------------------------+--------------------------------| | | | |Urgency: No |Mandate: No | | | | |--------------------------------+--------------------------------| | | | |Hearing Date: May 11, 2015 |Consultant: Marie Liu | | | | ----------------------------------------------------------------- This bill meets the criteria for referral to the Suspense File. Bill Summary: SB 551 would declare it the state's policy that water use and water treatment shall be as energy efficient as is feasible and that energy use and generation shall be as water efficient as is feasible. Fiscal Impact: Cost pressures, potentially in the millions of dollars to the General Fund and various special funds to increase grant awards, reprioritize programs, and change state operations to increase electricity and water efficiency. Background: The Warren-Alquist State Energy Resources Conservation and Development Act establishes the state's policy to promote all feasible means of energy and water conservation and all feasible uses of alternative energy and water supply sources. (PRC §25008) SB 551 (Wolk) Page 1 of ? The Water Measurement Law contains Legislative findings and declarations that state that the waste or unreasonable use of water imposes unnecessary and wasteful consumption of energy to deliver or furnish the water therefore, water usage should be measured in order to reduce energy consumption. (WC §522) Proposed Law: This bill would declare it the state's policy that water use and water treatment shall be as energy efficient as is feasible and that energy use and generation shall be as water efficient as is feasible. Relevant state agencies would be required to consider this policy in their policies, regulations, and grant criteria. Staff Comments: This bill sets a state policy regarding water and energy efficiency and directs the state agencies to consider this policy in their various activities. No actual actions are required; however various agencies may see cost pressures to implement the policy. More specifically, the state offers of number of water and energy related financial assistance programs. The policy adopted by this bill could implore the granting agencies to consider more expensive projects. For example, the State Water Resources Control Board offers grants from the Drinking Water State Revolving Fund to assist communities in enhancing and upgrading drinking water supplies. Incorporating additional water and energy efficiencies upgrades into a grant for water treatment and delivery could increase project costs. Staff notes that energy and water efficiency projects can require more upfront costs in order to reduce ongoing operational costs. That said, the State Water Resources Control Board believes there would be no costs to just consider water and energy efficiencies. The state itself operates water systems that require energy, such as the State Water Project which uses considerable amount of energy to move water resources around the state. This bill would impose cost pressures for energy efficiency upgrades. SB 551 (Wolk) Page 2 of ? This bill is trying to promote actions that are as energy and water efficient "as is feasible." Staff notes that what is "feasible" could be beyond what is cost effective. -- END --