BILL ANALYSIS
AB 2561
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Date of Hearing: May 12, 2010
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 2561 (Villines and Fuentes) - As Amended: April 26, 2010
Policy Committee:
UtilitiesVote:14-0
Natural Resources 9-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill replaces the California Energy Commission (CEC),
within the Resources Agency, with a Department of Energy (DOE),
headed by cabinet-level Secretary of Energy, which would also
assume additional state energy-related responsibilities.
Specifically, this bill:
1)Combines all existing functions of the CEC, and the following
energy-related programs and responsibilities, within the DOE,
which would be responsible for planning, developing, and
implementing all major aspects of state energy policy:
a) The Electricity Oversight Board (EOB).
b) The Energy Extension Service in the Office of Planning
and Research.
c) The Energy Assessment Program and Energy Services
Program in the Department of General Services.
2)Provides for appointment of a Secretary of Energy, subject to
Senate confirmation and serving at the pleasure of the
governor.
3)Reconfigures the CEC-to be renamed the California Energy
Board-within the DOE, to consist of the Energy Secretary as
chair plus four members appointed to four-year terms.
4)Requires the DOE, in consultation with the Public Utilities
Commission and the California Independent System Operator,
January 1, 2012, to submit a report identifying administrative
and statutory measures that would improve the siting and
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licensing process of transmission lines.
5)Repeals several obsolete energy-related state agencies and
programs.
FISCAL EFFECT
1)The EOB was defunded and ceased operations as of April 1,
2008, thus reconstituting its functions within the DOE will
require ongoing special fund costs in the range of $2 million
to $3 million. (The EOB was funded about 85% from the Public
Utilities Reimbursement Account and 15% from the Energy
Resources Programs Account.)
2)Assuming the staff and special fund resources associated with
the other non-CEC state functions being transferred to the DOE
would also be transferred, the net fiscal impact of the
reorganization should not be significant.
COMMENTS
1)Purpose . This bill, sponsored by the Administration, is
intended to consolidate the state's authority for energy
policy and related functions within DOE to allow for singular
statewide energy policy, and elevating the subject of energy
to cabinet-level importance.
2)Legislative History . Energy agency reorganization proposals
are not new. In 2005, AB 1190 (Canciamilla) proposed an Energy
Agency and required the governor to submit a Governor's
Reorganization Plan (GRP) to the Little Hoover Commission by
May 1, 2006, and to the Legislature by July 1, 2006. The bill
also specified the structure and elements of the GRP, which
consolidated existing state energy-related functions into one
DOE, which is administered by the Secretary of Energy. AB 1190
failed passage in the Assembly Utilities and Commerce
Committee. Shortly thereafter, the governor introduced GRP #3,
which was rejected by the Legislature due to legal issues
concerning proposed changes involving the PUC. Later in 2005,
the governor subsequently resubmitted the GRP proposal in bill
form (AB 1165, Bogh) and included certain policy changes made
in response to issues raised during hearings held by the
Little Hoover Commission on the prior GRP. AB 1165, which was
never heard by any committee, made the Secretary a member of
the commission. It also made the new DOE the lead state entity
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to appear before the Federal Energy Regulatory Commission
(FERC), while allowing other state entities to also appear.
Last year, ABX3 33 (Villines), which was similar to this bill,
passed the Assembly late in the legislative session, but was
never taken up in the Senate.
Analysis Prepared by : Chuck Nicol / APPR. / (916) 319-2081