BILL ANALYSIS
AB 2378
Page 1
Date of Hearing: May 3, 2010
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Steven Bradford, Chair
AB 2378 (Tran) - As Introduced: February 19, 2010
SUBJECT : Energy: Renewable Energy Program.
SUMMARY : Includes the definition of "dual renewable energy
device" as a device that utilizes two different renewable energy
generating technologies in the same device where neither
renewable generating technology produces less than 20% of the
total energy production by the device.
EXISTING LAW :
1)Requires investor-owned utilities (IOUs) and certain other
retail sellers to achieve a 20% Renewable Portfolio Standard
(RPS) by 2010, and requires publicly-owned utilities (POUs) to
implement and enforce their own RPS programs.
2)Establishes the Renewable Energy Resources Program (Renewables
Program) to complement the RPS by increasing the quantity of
electricity generated by in-state renewable electricity
generation facilities and identifying and supporting specified
emerging renewable technologies.
3)Defines eligible renewable technologies under the program to
include: biomass, solar thermal, photovoltaic, wind,
geothermal, fuel cells using renewable fuels, small
hydroelectric generation of 30 megawatts or less, digester
gas, municipal solid waste conversion, landfill gas, ocean
wave, ocean thermal, or tidal current, and any additions or
enhancements to the facility using that technology.
FISCAL EFFECT : Unknown.
COMMENTS : According to the author, the purpose of this bill is
to codify a definition of "dual renewable energy device" to
encourage combining existing renewable energy sources in ways
which do not expand the footprint for such devices, but instead,
provide greater renewable energy output.
1) Background : California's RPS program requires IOUs to
increase their purchases of energy from renewable sources by 1%
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each year, with the goal of procuring 20% of their electricity
from renewable technologies by 2010. The California Public
Utilities Commission (CPUC) oversees IOUs' RPS compliance. POUs
must adopt and enforce comparable renewable programs, with
oversight by the California Energy Commission (CEC).
The Renewables Program was established to complement the RPS by
providing 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 Renewable Energy Public
Goods Charge, which is paid by electric utility customers.
Current law requires 20% of the funds to be used for programs
that support in-state 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.
Renewable resources that are eligible for the Renewables Program
and for RPS compliance, include: biomass, solar thermal,
photovoltaic, wind, geothermal, fuel cells using renewable
fuels, small hydroelectric generation of 30 megawatts or less,
digester gas, municipal solid waste conversion, landfill gas,
ocean wave, ocean thermal, or tidal current, and any additions
or enhancements to the facility using that technology.
2) How renewable is a dual renewable energy device : This bill
would define a dual renewable energy device where neither
renewable generating technology produces less than 20% of the
total energy production by the device. The author states that
such devices could include: wind turbines atop wave generators;
photovoltaic panels and/or wind turbines affixed to wave
machines; wind turbines affixed to exhaust vents from biomass
generators; or, any other combination of renewable energy
devices that increases net energy generation.
If each of the two technologies produces at least 20%, it is
unclear whether this bill would intend to allow 100% of the
energy generated from that facility to be counted as renewable,
or just the 40% that's actually from renewable inputs. The CEC
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is tasked with establishing eligibility requirements for
renewable resources. The CEC guide book states that the
generator can count as renewable any output that is associated
with renewable input. So if the generator uses 20% wind and 80%
solar, it is considered 100% renewable. If the generator uses a
fuel cell that runs on 20% biogas and 80% natural gas, only 20%
of the output is considered renewable for RPS compliance.
3) What does the bill do : According to the sponsor, STS
Venture Consulting-a start-up business development and
venture-capital firm, this bill is intended to provide
incentives to creatively combine renewable technologies that are
already on the market in order to maximize space and efficiency.
However, even if this committee requires the device to use
eligible renewable resources to generate 100% of its output, the
technology is already eligible for both the Renewables Program
and RPS compliance.
Although the author's intent of this bill may be to encourage
development of dual renewable generating devices, the bill only
includes a definition but doesn't provide for any incentives to
encourage development. It could cause confusion by including
the definition in this section of code that governs the RPS and
may initiate debate over whether a dual renewable energy device
that could only generate just 40% of its output from renewable
resources, is "implied" to be included in the Renewables
Program.
If this committee wishes to clarify that a facility that uses
more than one renewable input to generate electricity is
eligible for the Renewables Program, it may wish to include an
amendment that deletes the separate definition of a dual
renewable energy device (Page 2, lines 9-13), and instead,
insert Page 2, line 21, "any combination of the renewable
resources,".
RELATED LEGISLATION :
AB 2589 (Tran) allows personal and corporate income tax credits
of 1.8 cents per kilowatt hour (kWh) for electricity produced by
a dual renewable energy device by qualified producers at
facilities located in the state or within three miles offshore.
AB 2589 includes an identical definition of dual renewable
energy device in the Revenue and Taxation Code.
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REGISTERED SUPPORT / OPPOSITION :
Support
None on file.
Opposition
None on file.
Analysis Prepared by : Angela Mapp and Gina Adams / U. & C. /
(916) 319-2083