BILL ANALYSIS
AB 2132
Page 1
Date of Hearing: April 19, 2010
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Steven Bradford, Chair
AB 2132 (Carter) - As Proposed to be Amended: April 19, 2010
SUBJECT : Energy: renewable energy resources and energy
improvements.
SUMMARY : Expands eligibility for the Renewable Energy
Resources Program (Renewables Program) to allow energy
efficiency improvements in buildings built before January 1,
1978, including multi-family housing to qualify for grants from
the Renewable Resources Trust Fund (RRTF).
EXISTING LAW :
1)Establishes the Renewables Program to increase the quantity of
electricity generated by in-state renewable electricity
generation facilities and identify and support specified
existing and emerging renewable technologies.
2)Require moneys collected from ratepayers via a public goods
charge for renewable energy to be transferred to the
California Energy Commission (CEC) for deposit in the RRTF,
for use for the Renewables Program.
3)Requires 20% of the of the money collected pursuant to the
renewable energy public goods charge to be used for existing
renewable technologies, 79% for a multiyear, consumer-based
program to foster the development of emerging renewable
technologies in distributed generation applications.
4)Requires the Renewables Program to provide monetary rebates,
buydowns, or equivalent incentives to purchasers, lessees,
lessors or sellers of eligible electricity generating systems
and requires those incentives to benefit the end-use consumer
by directly and exclusively reducing the purchase or lease
cost of the eligible system or the cost of electricity
produced by the system.
5)Requires the CEC to establish criteria for a statewide home
energy rating system (HERS) for residential buildings and to
develop an informational booklet to educate and inform
homeowner's rental property owners and other parties, about
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HERS.
6)Requires the California Public Utilities Commission (CPUC), in
consultation with the CEC, to identify all potentially
achievable cost-effective electricity and natural gas
efficiency savings and establish efficiency targets for an
electrical corporation to achieve those targets.
7)Allows the PUC to require energy conservation programs for the
customers of investor-owned utilities (IOUs) and requires IOUs
to perform home weatherization services for low-income
customers.
8)Requires the CEC to develop a comprehensive energy efficiency
program for existing residential and nonresidential buildings,
requires the CPUC to investigate the ability of electric and
gas utilities to provide energy efficiency financing options
to their customers to implement the program, and requires
publicly-owned utilities (POUs) to develop similar programs.
9)A CPUC regulation requires the three largest IOUs to collect
$3.1 billion over a 3-year period to fund energy efficiency
rebates, zero-interest loans, and other financial incentives.
FISCAL EFFECT : Unknown.
COMMENTS : According to the author, "Energy efficiency can be
especially difficult to implement in existing buildings not
subject to current efficiency standards or in renter-occupied
units, where costs and benefits of efficiency may accrue to
different parties." The author notes that the bill keeps with
the intent of programs financed by the public goods charge,
while providing energy savings, ratepayer benefits, and
workforce development.
1) Background: The Renewables Program and the RRTF was
established in 1997 to provide grants and subsidies to existing,
new, and emerging technologies to increase the quantity of
electricity generated by in-state renewable electricity
generation facilities. Administered by the CEC, the Renewables
Program offers consumer rebates for on-site renewable energy
systems, and consumer information on the purchase, installation,
and available incentives for renewable energy.
The Renewables Program is funded by the RRTF, which derives its
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revenue from the renewable energy public goods charge which is
paid by electric and gas utility customers. Current law
requires 20% of the funds to be used for programs that support
in-state existing renewable electricity generation facilities,
and 79% of the funds to be used for a consumer-based program for
emerging renewable technologies in distributed generation
applications. (The remaining amount is for consumer education
and outreach.)
Of the emerging account allocation, about 80% of the fund's
proceeds are dedicated to the New Solar Homes Partnership
program, which provides financial incentives to encourage the
installation of solar energy systems on new residential
construction. This program has been undersubscribed during
recent years due to the lack of new home construction, and the
RRTF is expected to have a balance of about $170 million at the
end of this fiscal year (if the General Fund repays a $35
million loan).
AB 2132 expands eligibility for the emerging account to include
energy efficiency improvements in existing buildings built
before January 1, 1978 - including multifamily housing units -
that are proven to be cost-effective. This bill requires
benefits to be fairly allocated among building owners and
renters, as determined by the CEC.
2) Why Energy Efficiency: Existing law places a high priority
on energy efficiency, requiring utilities to meet energy
efficiency goals, and providing utility customers with
energy-saving programs and assistance such as home
weatherization services and building energy audits. Energy
efficiency can also lead to greenhouse gas emission reductions.
To reduce energy usage in existing buildings, the CEC and most
of the utilities provide information on energy-efficiency
do-it-yourself audits. The CEC issued a booklet directed at
homebuyers that provides information about home energy audits
and rating programs, and markets this information through home
warranty company Web sites. Many of the recommendations require
nominal expenses that render large savings. Some low-cost
examples include replacing incandescent light bulbs with compact
fluorescent ones, using motion sensor controls for exterior
lighting, and caulking, sealing, or applying weather-stripping
to seams, cracks, and openings around windows and doors.
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The Legislature in 2006 directed the CEC to develop a statewide
estimate of all potentially achievable cost-effective
electricity and natural gas efficiency savings, and to establish
annual targets for energy efficiency savings and demand
reduction over 10 years. The CEC estimates that cost-effective
energy efficiency measures applied to existing buildings would
save 9% of statewide electricity consumption, 11% of peak
demand, and 5% of natural gas consumption.
Last year, the Legislature approved AB 758 (Skinner) Chapter
470, Statutes of 2009, which requires the CEC to develop a
comprehensive energy efficiency program for existing residential
and nonresidential buildings, requires CPUC to investigate the
ability of electric and gas utilities to provide energy
efficiency financing options to their customers to implement the
program, and requires the POUs to develop similar programs.
Given this recent directive to the CEC, it might be premature to
alter the Renewables Program to include energy efficiency
improvements in existing residential and commercial buildings.
It might also run counter to the stated intent of the
Legislature to use these funds for emerging distributed
generation technologies. As such, this committee may wish to
establish a sunset date of December 31, 2012, to trigger
legislative review if new home construction rebounds.
SUGGESTED AMENDMENTS :
Prior related legislation has referenced "nonresidential"
instead of "commercial" buildings. The committee may wish to
use conforming language and amend the bill as follows:
On page 10, line 2, after "and" strike out "commercial" and
insert "nonresidential."
RELATED LEGISLATION :
SB 77 (Pavely) establishes a reserve account for the California
Alternative Energy and Advanced Transportation Financing
Authority to use as security for bond financing to assist cities
and districts with providing financing for the installation of
renewable energy and water efficiency improvements for programs
established by AB 811 (Levine) Chapter 159, Statutes of 2008.
SB 77 appropriates up to $50 million from the Renewable
Resources Trust Fund for the reserve program, until January 1,
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2015. SB 77 is awaiting the Governor's signature.
SBX8 26 (Pavley) was nearly identical to SB 77, but included
language pertaining to prevailing wages. The bill died on the
Assembly Floor.
REGISTERED SUPPORT / OPPOSITION :
Support
None on file.
Opposition
None on file.
Analysis Prepared by : Angela Mapp and Gina Adams / U. & C. /
(916) 319-2083