BILL ANALYSIS �
AB 642
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Date of Hearing: April 25, 2011
ASSEMBLY COMMITTEE ON NATURAL RESOURCES
Wesley Chesbro, Chair
AB 642 (Calderon) - As Amended: March 31, 2011
SUBJECT : Renewable energy: biomass: algae
SUMMARY : Specifies (1) that the State Lands Commission (SLC)
may enter into a lease for the development of algae-producing
energy and agricultural products and (2) that biomass includes
algae for the purpose of receiving funding from the Renewable
Resources Trust Fund (Fund) or the California Alternative Energy
and Advanced Transportation Financing Authority (Authority).
EXISTING LAW :
1)Provides that SLC has exclusive jurisdiction and leasing
authority over all public trust lands owned by the state.
Public trust lands generally consist of tide and submerged
lands and beds of navigable channels, streams, rivers, creeks,
lakes, bays, and inlets.
2)Protects the public's right to use California's public trust
lands for commerce, navigation, fishing, boating, natural
habitat protection, and other water oriented activities.
3)Requires the California Energy Commission (CEC) to optimize
public investment and ensure that the most cost-effective and
efficient investments in renewable energy resources are
vigorously pursued.
4)Establishes the Fund, which is administered by CEC and funded
by a charge paid by customers of energy corporations. A
portion of the Fund is to be used for programs that are
designed to achieve fully competitive and self-sustaining
existing in-state renewable electricity generation facilities,
such as facilities that use biomass energy.
5)Establishes the Authority, which provides bond financing for
facilities that use alternative energy sources, such as
biomass energy.
THIS BILL :
AB 642
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1)Specifies that SLC may enter into a lease for the development
of algae-producing energy and agricultural products when such
a lease appears to be in the public interest.
2)Specifies that biomass includes algae for the purpose of
receiving funding from the Fund or Authority.
FISCAL EFFECT : Unknown
COMMENTS :
1)Background. Algae are attracting attention as a renewable
energy source because the strains can potentially produce 10
or more times more fuel per acre than the corn used to make
ethanol or the soybeans used to make biodiesel. Unlike row
crops, algae growth is not dependent on a particular season.
Moreover, algae can grow in seawater, but can also thrive in
desert ponds, using high-saline water from aquifers that
cannot otherwise be used. Many species of algae can even grow
in wastewater from treatment plants and water that contains
nitrates, phosphates, and other contaminants. Algae are also
a consumer of carbon dioxide.
Particular focus has been placed on the use of algae for jet
fuel. At least one major airplane has stated that commercial
airlines may derive one percent of their fuel by 2015 from
biofuels made of plants including algae. There are currently
efforts in Mexico to produce one percent of the nation's jet
fuel from algae in less than five years.
Under SLC's general leasing authority, it may enter into a
lease for algae-producing energy and agricultural products as
long the lease does not conflict with the public's right to
use California's public trust lands (i.e. the Public Trust
Doctrine), the constitution, or state laws. The state is also
authorized to utilize the Fund and the Authority for
qualifying projects involving algae-algae fuel is considered
biomass energy. The bill's intent is to explicitly reference
algae in the relevant SLC, Fund, and Authority governing
statues. The bill may help encourage more businesses to
invest in the development of algae fuel.
2)Need for and effect of bill is unclear. Under existing law,
SLC has broad authority to enter into leases. This would
include algae production, although such a lease has never been
AB 642
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proposed. This bill's SLC lease provisions are consistent
with current law and may be considered a clarification of
SLC's authority with respect to algae, but do not appear to
make any substantive change to SLC's authority.
Under existing law, "biomass" is an eligible renewable energy
resource for purposes of the CEC's Renewable Energy Program,
the Renewables Portfolio Standard, and Authority funding.
Biomass is not specifically defined to include or exclude
algae, and it seems to go without saying that algae are
biomass. The committee could not find any evidence that the
question has ever come up at the CEC or the Authority. It is
important to note that algae's potential seems to lie in
transportation fuel production, as noted above. However, the
CEC renewable energy programs referenced in this bill are
focused on electric energy production rather than
transportation fuels. The effect of adding "algae" to these
sections is unclear. Nevertheless, if the author's intent is
to clarify that algae is eligible for these renewable energy
programs, the author and the committee may wish to consider
amending the bill to add a new section declaring that algae is
biomass for purposes of the relevant code sections, rather
than amending the sections themselves.
REGISTERED SUPPORT / OPPOSITION :
Support
None on file
Opposition
None on file
Analysis Prepared by : Mario DeBernardo / NAT. RES. / (916)
319-2092