BILL ANALYSIS
AB 46
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ASSEMBLY THIRD READING
AB 46 (Blakelsee)
As Amended March 31, 2009
2/3 vote
UTILITIES AND COMMERCE 14-0
APPROPRIATIONS 17-0
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|Ayes:|Fuentes, Duvall, Tom |Ayes:|De Leon, Nielsen, Ammiano, |
| |Berryhill, Blakeslee, | | |
| |Buchanan, Carter, Fong, | |Charles Calderon, Davis, |
| |Fuller, Furutani, | |Duvall, Fuentes, Hall, |
| |Krekorian, Skinner, | |Harkey, Miller, |
| |Smyth, Swanson, Torrico | |John A. Perez, Price, |
| | | |Skinner, Solorio, Audra |
| | | |Strickland, Torlakson, |
| | | |Krekorian |
|-----+--------------------------+-----+---------------------------|
| | | | |
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SUMMARY : Extends the sunset dates, from January 1, 2011 to
January 1, 2020, for the Energy Conservation Assistance Account
(ECAA) and the Local Jurisdiction Energy Assistance Account
(LJEAA), each administered by the California Energy Commission
(CEC).
EXISTING LAW establishes:
1)ECAA to provide loans to schools, hospitals, public care
institutions, and local government entities for financing
energy conservation related projects.
2)LJEAA as a separate account within the General Fund as a
depository for all money received from local jurisdictions
from loan repayments, for energy project assistance. Permits
CEC to contract for project services including feasibility
analyses, project design, field evaluation, and operation and
training assistance.
FISCAL EFFECT : According to the Assembly Appropriations
Committee, continues local assistance energy efficiency programs
and their associated spending for nine additional years.
According to data from the CEC, loans under the ECAA have
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averaged about $8 million over the last five years. For the
LJEAA, only one loan ($651,000) has been made in the last five
years. In addition, any money remaining in the ECAA as of the
current sunset date would otherwise revert to the General Fund.
COMMENTS : ECAA was created in 1979 to provide grants and loans
to fund energy efficiency measures in schools, hospitals, public
care institutions, or units of local government and their
ancillary services. The repayment of the loan is based on the
amount of money saved as a result of the installation of
efficiency measures. In the short run the borrower's energy
payment doesn't decrease because the amount saved due to the
energy efficiency project is used to pay back the loan. After
the loan is fully repaid, the borrower entirely benefits by the
savings.
CEC notes that this program has had no defaults. CEC calculates
the amount of the loan based upon a 15-year payback solely from
energy savings.
In the 1980s the federal government had several lawsuits against
the Organization of Petroleum Exporting Countries (OPEC). There
were five total overcharge cases against domestic oil producers
in California that settled for a total of $426 million. The
penalties levied against oil producers were intended to provide
restitution to victims of the oil overcharges. Expenditure of
the funds was required to benefit energy consumers and could not
supplant state funds already allocated for energy-related
programs. To fund projects of statewide benefit, the state
created the Petroleum Violation Escrow Account (PVEA). LJEAA
was created from a $40.5 million appropriation from PVEA for
energy training and management assistance, and to provide loans
to local jurisdictions for energy project assistance.
To date, LJEAA has funded over 600 projects including public
transportation, computerized school bus routing, highway
projects, airport maintenance and reduction in airport user
fees.
Analysis Prepared by : Gina Adams / U. & C. / (916) 319-2083
FN: 0001173
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