BILL ANALYSIS �
AB 631
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Date of Hearing: April 11, 2011
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Steven Bradford, Chair
AB 631 (Ma) - As Introduced: February 16, 2011
SUBJECT : Public utilities: electric vehicle charging stations.
SUMMARY : States that a facility that supplies electricity to
charge electric vehicles is not a California Public Utilities
Commission (PUC)-regulated "public utility."
EXISTING LAW :
1)The State Constitution permits the PUC to fix rates and
establish rules for all public utilities and includes the
furnishing power as a public utility, subject to control by
the Legislature.
2)Includes electrical corporations in the definition of "public
utility."
3)Requires the PUC to evaluate policies to develop
infrastructure sufficient to overcome any barriers to the
widespread deployment and use of plug-in hybrid electric
vehicles (PHEVs) and electric vehicles (EVs), and adopt rules
by July 1, 2011.
FISCAL EFFECT : Unknown.
COMMENTS : According to the author, "one of the biggest
customer concerns about purchasing an electric vehicle is 'range
anxiety'. Customers are concerned about where they can charge
the electric vehicle away from home which often times mean they
may not travel too far from home." The author states, "without
adequate infrastructure, consumers will be reluctant to purchase
electric vehicles. California's electric vehicle infrastructure
is not yet robust enough to support the predicted growth of
electric vehicle adoption in the state, and there is a need for
electric vehicle infrastructure to drive the market for electric
vehicles."
The author introduced AB 631 to put into law a recent decision
by the PUC to not regulate electric vehicle charging stations as
utilities. According to the author, "absent this bill, the
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needed charging stations won't exist. Apartment complexes,
parking garages, and commercial buildings will not want to
install these stations if they are regulated as a public
utility. They don't want to assume the regulatory burden of
hiring lawyers in order to invest in expanding infrastructure."
The PUC has an open proceeding (R.09-08-009) to consider the
impacts of the electrification of vehicles on the grid and how
to manage those impacts. A proposed decision in that proceeding
concludes that entities selling electricity at retail for
electric vehicle charging are not public utilities within the
meaning of PUC Section 216. The author agrees that businesses
providing the service to fuel electric vehicles should not be
held to the same rigor as a public utility. Consequently, this
bill codifies that decision.
Background : The California Energy Commission (CEC) published its
2010-2011 Investment Plan for the Alternative and Renewable Fuel
and Vehicle Technology Program report, which notes that in the
United States, and in California, 95 percent of vehicles are
dependent on petroleum-based fuels. In 2008, California's
transportation sector consumed about 15 billion gallons of
gasoline and more than 3 billion gallons of diesel fuel. This
sector represents approximately 40 percent of the state's
greenhouse gas emissions, the largest amount from any sector.
In January 2011, President Obama set an ambitious goal of
putting 1 million advanced technology vehicles on the road by
2015, which would reduce dependence on foreign oil and lead to a
reduction in oil consumption of about 750 million barrels
through 2030.
Because of California's aggressive climate change goals, the
state has become one of the most attractive markets for EVs. A
vigorous new EV industry has the potential to fuel economic
growth by creating jobs and building on the hub of EV technology
and manufacturing companies headquartered in the state. The CEC
projects the number of electric vehicles could grow from 32,756
in 2011 to 1.5 million by 2020 and 2.8 million by 2030. Most of
the jobs created directly by the state's EV rollout will be in
technology, manufacturing, installation, and support services,
all provided locally.
Despite existing EV goals, it has been represented by some
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parties that consumers are unlikely to adopt EVs unless they are
as convenient to own as the gasoline car. Without market
solutions, California may not reap the environmental and
economic benefits of electric vehicles. Encouraging consumer
adoption, innovation and investment is the key to driving future
growth of low to zero emissions vehicle markets.
1)PUC Rulemaking : The PUC has taken the first step in
encouraging solutions for EVs. In
2009, the PUC opened a rulemaking (R-09-08-009) to consider
infrastructure, rates, and policies to support EVs. The
rulemaking also addressed the requirements of SB 626 (Kehoe)
Chapter 355, Statutes of 2009, which requires the PUC, in
consultation with the CEC, the Air Resources Board, electrical
corporations, and the motor vehicle industry, to evaluate
policies to develop infrastructure sufficient to overcome any
barriers to the widespread deployment and use of PHEVs. SB 626
requires the PUC to adopt rules by July 1, 2011.
On July 29, 2010, the PUC issued a decision on Phase I of the
rulemaking. The PUC ruled that the ownership or operation of a
facility that sells electricity at retail to the public for use
only as a motor vehicle fuel does not make the corporation or
person a "public utility" within the meaning of the Public
Utilities Code.
Phase II of the rulemaking will consider the appropriate utility
role: 1) in the provision of electric vehicle charging services
to the public; 2) with respect to charging equipment on the
customer's side of the meter, and 3) in cost allocation,
including a consideration of the circumstances in which the
costs of any distribution system upgrades should be borne by an
individual customer or be recoverable from all customers, in
addition to other related issues. The Phase II decision is
expected to be released soon.
3) Legislative oversight : On May 24, 2010, the Assembly
Transportation Committee and this committee held a joint hearing
to explore the requirement that manufacturers produce and
deliver electric vehicles for sale in California as a greenhouse
gas reduction method. One of the concerns raised was how rates
would be set to encourage the efficient use of the electricity
infrastructure when recharging EVs. Another issue was how
California should address a market for retail electricity at
remote public or private re-charging stations.
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The hearing revealed that some companies are currently providing
electricity for plug-in electric vehicle hybrid owners to
re-charge at non-residential based locations. For example,
Coulomb Technologies, Inc. provides networked charging stations
throughout the U.S. and some European locations. Each station is
embedded with an on-board computer, a fluorescent display, a
radio-frequency identification (RFID) reader, and a
utility-grade meter that provides precise, bi-directional energy
measurement. The customer scans his or her RFID card to
re-charge, and can access their energy usage and communicate
over the network for demand-side management, preferred pricing
incentives, and other mechanisms. Another company, Better Place,
provides charging points and battery-exchange stations. In
November 2008, the mayors of San Francisco, Oakland, and San
Jose, signed up Better Place to deliver the charging
infrastructure to the Bay Area. Their goal is to have 250,000
charging ports, 200 battery-exchange stations, and a control
center to service Bay Area electric car drivers. The cost is
estimated at $1 billion. They started work in January 2009 and
hope to have full commercial availability of the electric cars
by 2012.
The CEC testified that California has 413 charging stations with
1,300 public access electric charge points. Many of the
existing charging stations need to be upgraded to charge the new
plug-in hybrid electric vehicles. However, the CEC did not
address how this would be funded. The CEC reported that it has
already issued about $15.3 million in grants for charging
stations.
4)Putting the cart before the horse : Several parties have
expressed concerns with the bill.
Pacific Gas and Electric claims this bill "undermines
legislative and PUC efforts to minimize electric grid impacts,
reduce greenhouse gas emissions and the need for new generating
capacity and foster the integration of renewable energy."
Southern California Edison (SCE) argues that the bill is
premature because the market for EV's is still in its infancy
and it is too soon to prejudge the best regulatory construct.
Moreover, SCE states that the PUC is already addressing these
early market issues in its EV proceeding and has proposed to
establish a working group to bring together federal and state
agencies, as well as other stakeholders to discuss appropriate
regulation. The California Electric Transportation Coalition
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claim "the issues surrounding the decision by the PUC, codified
AB 631, are directly related to the issue of how the entities
identified in AB 631 will be regulated and by whom. Without the
benefit of the completion of the PUC proceeding and an
understanding of customer and ratepayer protection as determined
by the proceeding, this bill is premature".
5)Previous Legislation : Last year, SB 1435 (Padilla) would have
codified that electric vehicles
are not a "public utility" consistent with the PUC decision;
however, it made a finding that the PUC should exercise limited
jurisdiction over third-party PHEV providers to ensure effective
load management. This committee clarified that this "limited
jurisdiction" in no way provides explicit or implicit authority
over the business practices of the recharging facilities.
"Limited jurisdiction" would allow the PUC to adopt a separate
tariff structure for the investor-owned utilities to apply
toward third-party recharging facilities that achieve the goals
and objectives of discouraging electric vehicle charging during
peak times. This bill died in the Assembly.
REGISTERED SUPPORT / OPPOSITION :
Support
Alliance of Automobile Manufacturers
Better Place
California Apartment Association (CAA)
California Business Properties Association
California Manufacturers and Technology Association (CMTA)
California Retailers Association (CRA)
Coulomb Technologies, Inc.
ECOtality, Inc.
Environmental Defense Fund
Plug In America
Western States Petroleum Association (WSPA)
Opposition
California Electric Transportation Coalition (CalETC)
Pacific Gas and Electric (PG&E)
Southern California Edison (SCE)
Analysis Prepared by : Gina Adams / DaVina Flemings / U. & C.
/ (916) 319-2083
AB 631
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