BILL ANALYSIS �
Senate Appropriations Committee Fiscal Summary
Senator Christine Kehoe, Chair
AB x1 13 (V.M. Perez)
Hearing Date: 05/23/2011 Amended: 04/26/2011
Consultant: Brendan McCarthy Policy Vote: NR&W 5-3
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BILL SUMMARY: AB x1 13 expands existing permitting requirements
for renewable energy projects to additional types of renewable
energy projects. The bill directs the Department of Fish and
Game to develop a Natural Communities Conservation Plan for
renewable energy in the San Joaquin Valley. The bill requires
the Energy Commission to provide grants to local governments for
renewable energy planning efforts.
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Fiscal Impact (in thousands)
Major Provisions 2011-12 2012-13 2013-14 Fund
New fee revenues At least ($6,000) over the next few
yearsSpecial *
Interagency transfer for Likely costs in the hundreds
of thousands Special **
permit review
Fish and Game $450 $850 $1,450 Special
*
NCCP development
Energy Commission $300 $8,600 $600 General
***
NCCP development
Planning grants $7,000 General
***
* Fish and Game Preservation Fund.
** Energy Facility License and Compliance Fund.
*** Energy Resources Program Account or Renewable Resources
Trust Fund.
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AB x1 13 (V.M. Perez)
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STAFF COMMENTS: This bill meets the criteria for referral to the
Suspense File.
Background
Under current law, thermal power plants with a capacity over 50
megawatts are licensed by the Energy Commission.
Under the California Endangered Species Act, certain species are
listed as endangered, threatened, or candidates for protected
under the law. The "take" of those listed species is prohibited
without an incidental take permit, which typically includes
stringent mitigation requirements. The Department of Fish and
Game is required to review project applications for incidental
take permits. The Department spends about $4 million per year
reviewing incidental take permit applications. The Department
generally does not charge fees for this review.
Under the Natural Communities Conservation Planning Act, local
governments, developers, the Department of Fish and Game, and
other parties can join together to create long-term,
landscape-wide plans for the conservation of species. The
purpose of Natural Community Conservation Plans authorized under
this law is to provide ongoing wildlife conservation while also
providing regulatory certainty to local governments and
businesses as to what lands can be developed and what lands will
be protected without fear of future regulation under the
California Endangered Species Act. (There is a similar process
in federal law, relating to the federal Endangered Species Act.)
Current law requires the state's investor owned electricity
utilities and load serving entities to increase their
procurement of renewable energy by one percent per year, such
that twenty percent of their total electricity load comes from
renewable resources by December 31, 2010. This requirement is
referred to as the Renewable Portfolio Standard. All three of
the state's investor owned utilities are behind in their
procurement of renewable resources, in part because of a lack of
transmission infrastructure from areas with potential renewable
resources. (SB x1 2 �Simitian] extends this requirement to
requires 33 percent renewable energy sources by 2020. That bill
has been signed by the Governor and will go into effect 60 days
after the close of the First Extraordinary Session of 2011.)
AB x1 13 (V.M. Perez)
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SB x8 34 (Padilla, 2010) made several changes to the process for
permitting certain solar thermal energy projects that are
eligible for funding under the American Recovery and
Reinvestment Act (ARRA) and would be located in the Colorado and
Mojave desert regions of the state. SB x8 34 requires project
applicants to pay a fee of $75,000 to the Department of Fish and
Game for review of incidental take permit applications. SB x8 34
also directs the Department to develop interim mitigation
strategies for species conservation in the desert region of the
state and authorizes project developers to pay "in lieu" fees
the Department to meet a project's Endangered Species Act
mitigation obligations. (In other words, project applicants
could pay the Department to undertake mitigation activities
required by the Endangered Species Act, rather than undertaking
the mitigation themselves. This would meet project applicants'
mitigation responsibilities under state law, but not federal
law.)
SB x8 34 also authorizes specified project applicants to pay
discretionary fees to the Energy Commission, to be used by the
Energy Commission to pay third party contractors to assist in
the review of licensing applications for eligible renewable
energy projects. The intent of this provision is to speed up the
licensing process, by allowing the Energy Commission to augment
staff resources with consultants, at the applicant's cost.
AB x1 13
This bill expands the authority granted under SB x8 34 for the
use of interim mitigation projects and "in lieu" fees, by adding
wind and geothermal energy projects in the Mojave and Colorado
Desert regions of the state. The bill also expands eligibility
by allowing projects that either are eligible for ARRA or have a
complete application by December 31, 2011.
The bill extends the authority for renewable energy project
developers subject to licensing requirements by the Energy
Commission to pay voluntary fees to allow the Energy Commission
to hire outside consultants to assist with licensing review.
The bill requires developers of renewable energy projects
anywhere in the state that are subject to the Endangered Species
Act to pay a fee of $50,000 to the Department of Fish and Game
for permit review. The Department is also authorized to require
additional fees to cover its actual costs to review an
AB x1 13 (V.M. Perez)
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application, up to a maximum of $200,000. For projects that are
licensed by the Energy Commission, the bill specifies that the
Department's costs for permit review will be paid from fees
imposed by the Energy Commission for project review (currently
capped in statute at $750,000 per project).
The Department indicates that about 120 proposed projects may
meet these criteria. Thus the bill would result in projected
revenues of at least $6 million to the Department over the next
several years, with the potential for additional revenues based
on the Department's actual costs.
Because the bill directs the Energy Commission to pay for the
Department's permitting costs related to projects that also need
licensing by the Energy Commission, the bill will result in
increased costs to the Energy Commission. Because most renewable
energy projects are not licensed by the Energy Commission, this
requirement will likely only apply to a small share of potential
renewable energy projects. The total amount of that revenue loss
is unknown, but likely to be in the hundreds of thousands.
Staff recommends the bill be amended to allow the Department to
collect fees directly from project applicants that are licensed
by the Energy Commission, rather than using Energy Commission
fees to pay for Department of Fish and Game costs. While
licensing fees paid to the Energy Commission were recently
raised in statute, the complexity of licensing large renewable
projects means that the increased fees still probably do not
cover all of the Energy Commission's costs.
The bill requires the Department of Fish and Game to enter into
agreements for the development of Natural Community Conservation
Plans within the San Joaquin Valley, provided that at least one
local government and one potential renewable energy project
developer agree to participate in the development of such a
plan.
The development of Natural Community Conservation Plans can take
several years and cost plan participants, including the
Department of Fish and Game and the Energy Commission,
substantial sums. The Department of Fish and Game indicates that
total costs to participate in the development of such a plan
would be about $3 million and the Energy Commission indicates
that its costs to develop such a plan would be almost $10
AB x1 13 (V.M. Perez)
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million.
Staff recommends the bill be amended to authorize, but not
require, the Department of Fish and Game to enter into a
planning agreement for the development of a Natural Community
Conservation Plan, consistent with existing requirements of law.
The bill authorizes the Energy Commission, upon appropriation of
the Legislature, to provide $7 million in grants to counties for
planning activities (including the development of Natural
Community Conservation Plans) to facilitate the development of
renewable energy projects on former agricultural lands in the
San Joaquin Valley and southern California.
The bill does not specify a fund source for these grants. The
most likely fund sources are the Energy Resources Program
Account or the Renewable Resources Trust Fund. Staff notes that
both of these funds face significant cost pressures and any
additional appropriation from these funds would require
offsetting program reductions or tax increases.
Staff recommends the bill be amended to eliminate the planning
grants.
Related Legislation
AB 603 (V.M. Perez) contains similar language to this bill. That
bill is in the Assembly Natural Resources Committee.
SB 16 (Rubio) extends the requirement that project developers
pay Endangered Species Act review fees to all renewable energy
projects and shortens certain timelines for review of those
permits by the Department of Fish and Game. That bill is on the
Senate Floor.
SB 23 (Simitian) makes technical changes to SB x1 (Simitian).
That bill is on the Senate Floor.
SB 881 (Corbett) requires the Office of Planning and Research to
compile information on the siting and permitting of renewable
energy projects and post that information on the internet. That
bill is on this committee's Suspense File.
AB x1 13 (V.M. Perez)
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