BILL ANALYSIS �
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THIRD READING
Bill No: AB 1073
Author: Fuentes (D)
Amended: 7/12/11 in Senate
Vote: 21
SENATE ENERGY, UTILITIES & COMMUN. COMM. : 11-0, 07/05/11
AYES: Padilla, Fuller, Berryhill, Corbett, De Le�n,
DeSaulnier, Pavley, Rubio, Simitian, Strickland, Wright
ASSEMBLY FLOOR : 78-0, 05/19/11 - See last page for vote
SUBJECT : Electrical corporation energy efficiency
programs:
application requirements
SOURCE : Western States Council of Sheet Metal Workers
DIGEST : This bill requires that a written building or
construction permit be submitted when customers apply to
electric utilities for ratepayer funded energy efficiency
incentives.
ANALYSIS : Existing law requires investor-owned utilities
(IOUs), gas corporations, and local publicly owned
utilities (POUs), in procuring energy, to first meet its
unmet resource needs through cost-effective energy
efficiency and demand response and requires establishment
of annual targets for utilities' energy efficiency savings.
Current law requires the California Public Utilities
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Commission (PUC) to administer cost-effective energy
efficiency programs.
Current decisions of the PUC approve a $3.1 billion
portfolio of energy efficiency programs for 2010-12
administered by the IOUs and funded by ratepayer charges,
which includes, among other elements, providing IOU
customers with rebates and incentives for adopting various
energy efficiency measures.
This bill requires any rebates or incentives offered by an
energy utility for an energy efficiency improvement or
installation of energy components, equipment, or appliances
in buildings shall be provided only if the recipient of the
rebate or incentive certifies that the improvement or
installation has complied with any applicable permitting
requirements and, if a contractor performed the
installation or improvement, that the contractor holds the
appropriate license for the work performed.
Background
Energy Efficiency Programs . Energy efficiency is the top
priority in California's policies to achieve energy savings
and reduce greenhouse gas emissions. The state's Title 24
energy efficiency building regulations, which are updated
every three years, specify requirements relating to
lighting, insulation, windows, heating, ventilation, and
air conditioning (HVAC) systems, and other construction
details designed to reduce energy consumption and lower
energy bills for consumers. The state's Title 20 energy
efficiency appliance regulations specify energy use
standards for most major household and commercial
appliances that must be met in order to be sold in
California. Numerous programs administered by the State
Energy Resources Conservation and Development Commission
(CEC), PUC, IOUs, POUs, and local government agencies offer
consumers incentives or rebates to purchase energy
efficiency appliances and construct or install energy
efficient devices or technologies in residential and
commercial buildings.
Energy Efficiency Enforcement . As ratepayer-funded energy
efficiency programs have proliferated, a growing number of
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policymakers and stakeholders have been sounding the alarm
that potential energy savings are not being realized
because of lax enforcement of building regulations and
licensing requirements and improper installations by
unlicensed or unskilled contractors. For example, recent
reports indicate that, in the HVAC sector, less than 10
percent of HVAC change-outs are carried out with building
permits, so code enforcement is rarely triggered.
Efforts to address this problem include the Contractors
State License Board (CSLB) and CEC entering a new
Memorandum of Understanding (MOU) in July 2010 for the
purpose of increasing collaboration on education and
enforcement of building and appliance regulations. The MOU
identifies many specific tasks the CEC will perform,
including preparation of outreach and education materials,
training CSLB enforcement staff, assisting CSLB with
investigations of complaints of contractor noncompliance,
and participating in enforcement sting operations. CSLB,
with the assistance of the CEC, conducted several sting
operations in 2010 targeting licensed contractors who were
suspected of installing HVAC units without obtaining
required permits, which the CSLB claims has led to
improvement in compliance.
In addition, the Attorney General convened the PUC, CEC,
CSLB and the IOUs to secure agreement on a plan for
ensuring compliance with energy efficiency regulations.
The PUC states that compliance with permit requirements as
a condition to receipt of incentives or rebates will be
part of its evaluation, measurement, and verification of
energy efficiency programs in the 2010-12 program cycle.
The current program cycle also includes $3.8 million for a
Compliance Enhancement program aimed at improving building
department code enforcement, and several other programs
with elements aimed at increasing code compliance on HVAC
installation. Southern California Edison instituted a
program in 2010 to give rebates to about 1,000 homeowners
who were required to show proof of a permit and that the
installing contractor was licensed by CSLB. Sacramento
Municipal Utility District, a POU, currently requires that
the contractor be licensed as a condition of receiving a
rebate or financing for installation of a HVAC unit.
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FISCAL EFFECT : Appropriation: No Fiscal Com.: No
Local: No
SUPPORT : (Verified 7/13/11)
Western States Council of Sheet Metal Workers (source)
Natural Resources Defense Council
ARGUMENTS IN SUPPORT : According to the author's office,
this bill adds another enforcement mechanism to ensure
compliance with local and state building codes and energy
efficiency standards with the goal of achieving greater
energy savings.
ASSEMBLY FLOOR :
AYES: Achadjian, Allen, Ammiano, Atkins, Beall, Bill
Berryhill, Block, Blumenfield, Bonilla, Bradford,
Brownley, Buchanan, Butler, Charles Calderon, Campos,
Carter, Cedillo, Chesbro, Conway, Cook, Davis, Dickinson,
Donnelly, Eng, Feuer, Fletcher, Fong, Fuentes, Furutani,
Beth Gaines, Galgiani, Garrick, Gatto, Gordon, Grove,
Hagman, Halderman, Hall, Harkey, Hayashi, Roger
Hern�ndez, Hill, Huber, Hueso, Huffman, Jeffries, Jones,
Knight, Lara, Logue, Bonnie Lowenthal, Ma, Mansoor,
Mendoza, Miller, Mitchell, Monning, Morrell, Nestande,
Nielsen, Norby, Olsen, Pan, Perea, V. Manuel P�rez,
Portantino, Silva, Skinner, Smyth, Solorio, Swanson,
Torres, Valadao, Wagner, Wieckowski, Williams, Yamada,
John A. P�rez
NO VOTE RECORDED: Alejo, Gorell
RM:nl 7/13/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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