BILL ANALYSIS
AB 2514
Page 1
ASSEMBLY THIRD READING
AB 2514 (Skinner)
As Amended May 28, 2010
Majority vote
UTILITIES & COMMERCE 8-6 NATURAL
RESOURCES 6-3
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|Ayes:|Buchanan, Carter, Fong, |Ayes:|Chesbro, Brownley, De |
| |Furutani, Ammiano, Ma, | |Leon, Hill, Ammiano, |
| |Skinner, Bradford | |Skinner |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Knight, Tom Berryhill, |Nays:|Gilmore, Knight, Logue |
| |Fletcher, Fuentes, | | |
| |Swanson, Villines | | |
| | | | |
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APPROPRIATIONS 12-5
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|Ayes:|Fuentes, Ammiano, | | |
| |Bradford, | | |
| |Charles Calderon, Coto, | | |
| |Davis, | | |
| |Monning, Ruskin, Skinner, | | |
| |Solorio, Torlakson, | | |
| |Torrico | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Conway, Harkey, Miller, | | |
| |Nielsen, Norby | | |
| | | | |
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SUMMARY : Requires California Public Utilities Commission (PUC)
to establish procurement targets for energy storage systems for
all load-serving entities for 2015 and 2020, and requires the
governing board of each publicly owned utility (POU) to adopt
energy storage system procurement targets to be achieved by 2016
and 2021 and report their progress to the California Energy
Commission (CEC). Specifically, this bill :
1)Declares, among other things, that energy storage systems are
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necessary and that there is inadequate evaluation of the use
of energy storage and inadequate statutory and regulatory
support.
2)On or before March 1, 2012, requires PUC to open a proceeding
to establish procurement targets for each IOU for viable and
cost-effective energy storage systems, and adopt energy
storage system procurement targets to be achieved by each IOU
by December 31, 2015, and a second target to be achieved by
December 31, 2020.
3)On or before October 1, 2014, requires the governing board of
each POU to adopt procurement targets for the utility for
viable and cost-effective energy storage systems and adopt
energy storage system procurement targets to be achieved by
December 31, 2016, and a second target to be achieved by
December 31, 2021.
4)As part of PUC proceeding, permits PUC to consider a variety
of possible policies to encourage the cost-effective
deployment of energy storage systems, including incentives and
refinement of existing procurement methods to properly value
energy storage systems, and permits PUC to apply different
policies to different load serving entities.
FISCAL EFFECT : According to the Assembly Appropriations
Committee:
1)Ongoing special fund costs to PUC of $1.1 million for nine
positions to establish a regulatory program for energy storage
through a ratemaking proceeding, monitor compliance with the
commission decisions, monitor procurement of storage services
and evaluate the cost- effectiveness of such procurement
through an annual compliance proceeding, and monitor the
impacts on ratepayers of energy storage technologies.
2)Costs to CEC would be absorbable, except one position might be
needed in the future, at a cost of $100,000, to review POU
compliance with the 2016 and 2021 targets.
COMMENTS : The most common form of energy storage device in use
today is batteries. However, there are no commercially
available batteries that could cost-effectively store the large
amounts of electricity that can be produced by large-scale wind
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farms or solar facilities. Another form of electricity storage
that is already in use in California is pump storage, where
water is pumped into a reservoir at night and then released
through turbines during the day to produce electricity.
Additional research is taking place to develop other storage
devices using compressed air, flywheels, fuel cells, and other
innovative technologies.
Since May 2008, the California Independent System Operator
(CAISO) has been coordinating a stakeholder process to identify
the issues associated with integrating different types of energy
storage technology on the electric power grid. CAISO launched
18-month pilot projects in July 2009, and is expected to be
complete by December 2010. The three IOUs are running a study
to develop cost-effectiveness methods for storage (permanent
load shifting) and ways to deliver incentives to end-use
customers to motivate customer investments in demand-side
storage.
Pacific Gas and Electric (PG&E) is piloting an energy storage
project that includes a 4 MW Sodium Sulphur (NaS) battery
project. PG&E states that the cost is "extremely expensive" at
about $4 million per MW. It is also implementing a 300 MW
compressed air energy storage (CAES) Kern Demonstration Project
that uses a porous rock reservoir in Kern County near where
4,500 MW of new wind is projected to connect to the grid. The
total cost of the facility is estimated to be $356 million.
Southern California Edison (SCE) is engaged in three energy
storage pilots. They are scheduled to be complete in 2012,
2014, and 2015.
Analysis Prepared by : Gina Adams / U. & C. / (916) 319-2083
FN: 0004740