BILL ANALYSIS
SB 17
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Date of Hearing: July 15, 2009
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Kevin De Leon, Chair
SB 17 (Padilla) - As Amended: July 8, 2009
Policy Committee:
UtilitiesVote:14-0
Urgency: No State Mandated Local Program:
Yes Reimbursable: No
SUMMARY
This bill requires the Public Utilities Commission (PUC) to
determine the requirements for a "smart grid" deployment plan
and to require each electrical corporation to submit a smart
grid plan to the PUC for approval. Specifically, this bill:
1)Requires the PUC, in consultation with the California Energy
Commission (CEC) and the California Independent System
Operator (CAISO), to determine the requirements for a "smart
grid" deployment plan and adopt standards and protocols,
consistent with the federal Energy Act, by July 1, 2010.
2)Permits any adopted plan to provide for deployment of
cost-effective smart grid products, technologies, and services
by entities other than electrical corporations.
3)Requires each electrical corporation to develop and submit a
smart grid deployment plan to the PUC for approval by July 1,
2011.
4)Permits smart grid technology to be deployed in a manner that
maximizes benefits and minimizes costs to ratepayers, and
requires the PUC, in consultation with the CEC and CAISO, to
evaluate, at each step of deployment, the impact of deployment
on specified initiatives and policies, including meeting the
renewable portfolio standard program goals and AB 32
greenhouse gas emission goals.
5)Requires the PUC, by January 1, 2011 and annually thereafter,
to report on its recommendations for a smart grid, the
utilities' deployment of this technology, and the benefits and
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costs to ratepayers.
6)Requires each local publicly owned electric utility to
develop, by July 1, 2011, a smart grid deployment plan
consistent with the federal Energy Act.
FISCAL EFFECT
1)Absorbable costs to the PUC, as the commission indicates it
has already commenced a proceeding on this issue.
2)The CEC will incur $200,000 annually for two positions for
ongoing consultation with PUC on the impact of deploying smart
grid technology on related programs and policies. [Energy
Resources Programs Account].
3)Any costs to local publicly owned utilities to adopt smart
grid plans will be recovered in rates charges to utility
customers.
COMMENTS
1)Purpose . According to the author, this bill is intended to
help electrical utilities manage their electricity usage,
deliver more efficient, reliable, and secure energy by
allowing utilities to monitor and diagnose problems in real
time throughout the grid while also reducing greenhouse gas
emissions.
2)Background . The term "smart grid" refers to an electrical
distribution system that allows for the flow of information
from a customer's meter in two directions and modernizes the
electrical transmission and distribution grid with a goal of
using advanced, information-based technologies to increase
grid efficiency, reliability, and flexibility, and reduce the
rate at which additional electric utility infrastructure must
be built.
The federal Energy Act requires the PUC to initiate within one
year, and complete within two years, consideration of whether
to allow utilities cost recovery from "nonadvanced grid
technologies," "deployment of a qualified smart grid system"
and implementation of the provision of price information to
customers on a no-less-than daily basis. The PUC commenced the
proceeding by December 2008, and expects completion by
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December 2009.
The federal American Reinvestment and Recovery Act of 2009
(ARRA) authorizes the Department of Energy to award $4 billion
in grants, including $615 million for smart grid regional
demonstration projects, utility-scale storage, and monitoring
projects, and another $600 million in grants to cover up to
50% of grid technology deployment project costs.
3)Prior Legislation . Last year, SB 1438 (Padilla), which was
substantially similar to this bill, was held on this
committee's Suspense file.
Analysis Prepared by : Chuck Nicol / APPR. / (916) 319-2081