BILL ANALYSIS                                                                                                                    �




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair


          AB 1073 (Fuentes) - Energy: Conversion of Solar thermal to 
          photovoltaic technology
          
          Amended: February 23, 2012      Policy Vote: 8-0
          Urgency: Yes                    Mandate: No
          Hearing Date: March 19, 2012                      Consultant: 
          Marie Liu     
          
          This bill meets the criteria for referral to the Suspense File.

          Bill Summary: This bill would specify that the California Energy 
          Commission (CEC) may retain jurisdiction over the siting of 
          specific solar thermal powerplants that seek to convert to solar 
          photovoltaic (PV) technology, even if the siting of that 
          powerplant has been challenged in court, so long as that 
          challenge has been dismissed by the California Supreme Court.

          Fiscal Impact: Likely one-time costs of at least $150,000 for 
          additional project application review due to project design 
          changes, from the Energy Resources Programs Account (ERPA), 
          which can be used for General Fund purposes. 

          Background:  The CEC has exclusive jurisdiction over the 
          certification (siting) of thermal powerplants, including solar 
          thermal, but not solar PV facilities. Last year, the passage of 
          SB 226 (Simitian) allowed the CEC to retain jurisdiction over 
          certain powerplants that were originally designed as a solar 
          thermal facility, but now the applicant wishes to convert the 
          facility to PV technology. SB 226 explicitly excluded projects 
          whose CEC certification has been challenged in court. This 
          exclusion affected one proposed facility, K Road Calico Solar. 
          While there was a legal challenge filed against the Calico 
          facility, the Supreme Court dismissed the challenge.
           
          Proposed Law: This bill would specify that certain facilities 
          are eligible to be permitted by the CEC as a PV facility even if 
          there was a legal challenge to the certification, so long as the 
          California Supreme Court subsequently dismissed the challenge. 

          Related Legislation: SB 226 (Chapter 469, Statutes of 2011, 
          Simitian)









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          Staff Comments: Current law (PRC �25806) requires that project 
          applicants pay a certification fee that is based on the 
          generation capacity of the facility. However, Calico's 
          application for certification was submitted in 2008, and the law 
          at the time exempted renewable energy facilities from the 
          certification fee (renewable resources were defined to 
          explicitly include solar thermal facilities, but not explicitly 
          PV facilities). As such, Calico Solar is not required to pay a 
          certification fee to the CEC. Switching technologies from solar 
          thermal to PV requires an applicant to submit an amendment to 
          their application but there is no fee charged for amendments. 

          Typical certification costs to the CEC range from $500,000 to 
          $1.5M. An amendment from solar thermal to PV should require less 
          review by the CEC than a new project as some of the impact 
          reviews can be similar as the original project. 
          Review costs are first paid by a certification fee, if any, with 
          the remaining costs covered by ERPA. As there is no 
          certification fee applicable to Calico Solar, all initial review 
          costs and additional costs imposed by the conversion amendment 
          will be covered by ERPA, which is funded by a surcharge on 
          electricity users in the state and is the primary funding source 
          for CEC staff, contract, and operating expenses. 

          Staff notes there is a debate surrounding this bill on the CEC's 
          jurisdiction over other non-thermal electric generation 
          facilities. Existing law allows for certain project developers 
          to voluntarily file an application for a nonthermal facility 
          with the CEC. In short, Section 25502.3 allows facilities 
          excluded from the CEC's jurisdiction to voluntarily submit an 
          application to CEC, essentially "opting in" into CEC's 
          jurisdiction. A "facility" is defined as a thermal powerplant 
          (�25110) and a "thermal powerplant" is defined as a facility 
          greater than 50MW and does not include "any wind, hydroelectric, 
          or solar photovoltaic electrical generating facility" (�25120).

          As this bill authorizes only a very limited expansion of the 
          CEC's jurisdiction, that is for a facility that was originally 
          designed as a solar thermal facility and whose certification by 
          the CEC was legally challenged but subsequently dismissed by the 
          California Supreme Court, staff has only taken into 
          consideration the costs of this specific expansion. Had this 
          bill intended to authorize a greater expansion of the CEC's 
          jurisdiction to cover non-thermal facilities, there would likely 








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          be considerable additional costs to ERPA.