BILL ANALYSIS Ó
SB 1453
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SENATE THIRD READING
SB
1453 (De León)
As Introduced February 19, 2016
Majority vote
SENATE VOTE: 26-10
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|Committee |Votes|Ayes |Noes |
| | | | |
| | | | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Utilities & |10-4 |Gatto, Burke, Eggman, |Patterson, Chávez, |
|Commerce | | |Dahle, Obernolte |
| | | | |
| | | | |
| | |Cristina Garcia, | |
| | | | |
| | | | |
| | |Eduardo Garcia, | |
| | | | |
| | | | |
| | |Roger Hernández, | |
| | |Quirk, Santiago, | |
| | |Ting, Williams | |
| | | | |
|----------------+-----+----------------------+--------------------|
|Appropriations |14-6 |Gonzalez, Bloom, |Bigelow, Chang, |
| | |Bonilla, Bonta, |Gallagher, Jones, |
SB 1453
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| | |Calderon, Daly, |Obernolte, Wagner |
| | |Eggman, Eduardo | |
| | |Garcia, Holden, | |
| | |Quirk, Santiago, | |
| | |Weber, Wood, Chau | |
| | | | |
| | | | |
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SUMMARY: Eliminates the ability of an electrical corporation
that provides electricity service to 75,000 or fewer California
customers to file a proposal with the California Public
Utilities Commission (CPUC) for alternative compliance with the
state's greenhouse gas (GHG) emission performance standard
(EPS). Requires the CPUC to review any capital expenditure
proposed by an electrical corporation for baseload generation
that does not comply with the state's GHG EPS and prohibits the
CPUC from allowing those costs to be recovered if it finds the
any of the following:
1)The proposed capital expenditure would materially extend the
service life of the baseload generation.
2)Cost-effective alternative resources would provide superior
long-term value to customers and satisfy the GHG EPS.
3)The accelerated retirement of the baseload generation unit
would promote state and regional GHG emissions reduction
goals.
FISCAL EFFECT: According to the Assembly Appropriations
Committee, increased annual CPUC administrative costs of
approximately $131,000 (Utilities Reimbursement Account).
COMMENTS:
SB 1453
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1)Purpose. This bill eliminates the alternative compliance
option, and requires all electrical corporations operating in
California to comply with CPUC's established GHG EPS. This
will result in prohibiting one company, PacifiCorp, from
extending or renewing contracts for coal-fired electricity.
Additionally, this bill ensures costs associated with
extending the life of coal-fired powerplants are not borne by
ratepayers.
2)The Greenhouse Gas Emission Performance Standard. In the
early 2000s, coal-fired powerplants supplied about one-fifth
of the electricity consumed in California. Following the
passage of SB 1368 (Perata), Chapter 598, Statutes of 2006,
the California Energy Commission (CEC) and the CPUC adopted an
EPS of 1,100 pounds of carbon dioxide per megawatt-hour for
baseload generation. This was, according to the agencies'
calculations, a rate that did not exceed the rate of GHG
emitted by a natural gas-fired combined-cycle powerplant used
for baseload generation, the standard established by SB 1368.
The effect of the EPS was to prevent the state's retail
sellers of electricity and publicly-owned utilities (POUs)
from entering into new contracts, or from renewing contracts,
for coal-fired generation of electricity.
3)PacifiCorp allowed alternative EPS. SB 1368 allowed an
electrical corporation meeting certain criteria to file a
proposal for alternative compliance with the CPUC. PacifiCorp
is a large electric utility serving 1.7 million customers in
six states in the Pacific Northwest and Rocky Mountain
regions. However, PacifiCorp serves approximately 45,000
customers in Northern California. PacifiCorp is the only
electrical corporation that qualifies for the alternative
compliance provisions. The rationale for PacifiCorp's special
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treatment is that it has a much smaller customer base over
which to spread the costs of compliance than do the state's
other electrical corporations. In addition, a large portion
of PacifiCorp's California customers are low-income. This
bill eliminates the alternative compliance option.
Analysis Prepared by:
Sue Kateley / U. & C. / (916) 319-2083 FN:
0003847