BILL ANALYSIS Ó
SENATE COMMITTEE ON NATURAL RESOURCES AND WATER
Senator Fran Pavley, Chair
2015 - 2016 Regular
Bill No: SB 919 Hearing Date: April 12,
2016
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|Author: |Hertzberg | | |
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|Version: |April 6, 2016 Amended |
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|Urgency: |No |Fiscal: |Yes |
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|Consultant:|Dennis O'Connor |
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Subject: Water supply: creation or augmentation of local water
supplies
BACKGROUND AND EXISTING LAW
Under existing law, the California Public Utilities Commission
(CPUC) has regulatory authority over public utilities, including
electrical corporations. The existing California Renewables
Portfolio Standard Program requires a retail seller of
electricity and local publicly owned electric utilities to
purchase specified minimum quantities of electricity products
from eligible renewable energy resources for specified
compliance periods, sufficient to ensure that the level of
procurement of electricity products from eligible renewable
energy resources reaches a specified percentage of retail sales
by a specified date.
PROPOSED LAW
This bill would require the CPUC, before July 1, 2018, in
consultation with the Independent System Operator, to address
the oversupply of renewable energy resources through a tariff or
other economic incentive for electricity purchased by customers
operating "facilities that create or augment local water
supplies."
The bill further defines "facilities that create or augment
local water supplies" to "include desalination, brackish water
desalting, water recycling, water reuse, and groundwater
SB 919 (Hertzberg) Page 2
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recharge facilities."
ARGUMENTS IN SUPPORT
According to the author, "Due to California's successful
renewable energy programs, regulators have identified an
"oversupply" of power during the day. The result is lower
wholesale prices for renewable energy, a trend that is
increasing in frequency and is not reflected in retail energy
prices. Oversupply increases costs to ratepayers and represents
a failure of the regulatory system to send proper price
signals."
"If we could let water suppliers know when there is an
oversupply of energy, processes could be changed to take
advantage of the low or negative pricing, reducing the cost of
making water locally. This, in turn, helps the grid operate more
efficiently and saves money for ratepayers."
ARGUMENTS IN OPPOSITION: None received
COMMENTS
As Noted In Energy, Utilities and Communications? This bill was
heard in and passed out of the Senate Committee on Energy,
Utilities and Communications on April 5, 2016. That committee's
analysis noted:
"Water facilities have limited ability to absorb excess
electric generation. According to staff of both the CPUC and
the CEC, local water supply augmentation facilities currently
present little potential to sop up excess electricity supply.
True, desalination plants and similar facilities are somewhat
intensive energy users. However, currently, there are very
few desalination plants in California. Both operating needs
and contractual obligations limit the ability of such plants
to quickly ramp production up or down."
"That said, it is conceivable that future desalination plants
and similar facilities could be designed and operated to allow
greater amounts of ramping. The tariff or other economic
incentive could encourage development of facilities better
SB 919 (Hertzberg) Page 3
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able to utilize excess electricity generation."
What about stormwater capture? If the purpose of this bill is to
see how various local water supply or augmentation systems might
be able to take advantage of low or negative electricity
pricing, it might make sense to also include stormwater and dry
weather runoff capture and use projects in the CPUC's analysis.
SUGGESTED AMENDMENT
AMENDMENT: On page 3, line 16, after "reuse," insert:
stormwater and dry weather runoff capture and use,
SUPPORT
Independent Energy Producers Association (Sponsor)
Association of California Water Agencies, if amended
California Association of Sanitation Agencies
California Municipal Utilities Association, if amended
San Diego County Water Authority
OPPOSITION
None Received
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