BILL ANALYSIS � 1
SENATE ENERGY, UTILITIES AND COMMUNICATIONS COMMITTEE
ALEX PADILLA, CHAIR
AB 1850 - Calderon Hearing Date:
July 3, 2012 A
As Amended: June 25, 2012 FISCAL B
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DESCRIPTION
Current law requires the California Energy Commission (CEC) to
adopt regulatory standards for minimum levels of operating
efficiency for appliances the use of which requires a
significant amount of energy or water on a statewide basis. The
regulations cannot result in any added total costs for consumers
over the designed life of the regulated appliances.
Current law authorizes the CEC to prescribe other cost-effective
measures to promote use of energy and water efficient
appliances, including energy consumption labeling not preempted
by federal labeling law.
Current regulations adopted by the CEC in January 2012 set
minimum efficiency standards for consumer battery chargers and
require a permanent label ("BC" inside a circle) on the product
nameplate or retail packaging, and instructions if included, to
indicate compliance. These state regulations are effective
February 1, 2013, for consumer chargers, and January 1, 2014,
for industrial chargers.
Current proposed federal regulations by the Department of Energy
(DOE) set minimum efficiency standards for battery chargers and
require a permanent label ("BC-III" inside a circle) on the
outside of its housing to indicate compliance. These federal
regulations would preempt state regulations although the
effective date is uncertain.
This bill delays the effective date of the label requirement in
state efficiency regulations for consumer battery chargers until
July 1, 2013, and makes it effective after that date only if a
label requirement in final federal regulations is not in effect
and then only until a federal rule becomes effective.
Current law prohibits the CEC from increasing or decreasing any
minimum efficiency appliance standard for five years after its
adoption unless another cost-effective measure for that
appliance is adopted.
This bill authorizes the CEC to increase or decrease a minimum
efficiency standard within five years of its adoption if it
finds that the regulation is no longer needed.
Current law requires any appliance manufacturer doing business
in California to submit information to CEC so CEC can study the
effects of efficiency regulations on sales of appliances and
makes this manufacturer information confidential and not a
public record.
This bill provides that, for confidential and proprietary
business information that would not otherwise be available to
the CEC, the CEC and manufacturer shall agree on the form and
substance of the submission.
This bill requires that, in adopting efficiency standards, the
CEC rely on the most current data possible and, wherever
feasible, rely on data no older than one year prior to the
commencement of the formal rulemaking process.
BACKGROUND
Energy Efficiency - California has pursued its energy demand
reduction goals through two primary avenues: utility-sponsored
programs to reduce end-user consumption, and codes and standards
designed to lower the energy use of buildings and appliances. By
2004, these efforts had cumulatively saved more than 40,000
gigawatt hours (GWh) of electricity and 12,000 megawatts (MW) of
peak electricity, equivalent to 24 500-MW power plants. More
than half of the statewide savings has come from the building
and appliance standards, with the balance resulting from
programs implemented by the state's investor-owned utilities
(IOUs) and local publicly-owned utilities (POUs). As a result
of these efforts California's energy use per capita has remained
stable for more than 30 years while the national per capita
average has increased by 40 percent and is nearly double that of
California.
CEC Appliance Standards - California's appliance efficiency
regulations were established in 1976 in response to a
legislative mandate to reduce California's energy consumption.
The regulations are updated periodically to allow consideration
and possible incorporation of new energy efficiency technologies
and methods. CEC claims that appliance standards alone have
saved California ratepayers $36 billion dollars and 20,000 GWh
since 1976.
The appliance efficiency regulations include standards for both
federally-regulated appliances and non-federally-regulated
appliances with multiple categories of commercial and
residential products including water heaters, clothes washers,
dishwashers, traffic signals, lighting and heath and air
conditioning systems and consumer products. The standards
within these regulations apply to appliances that are sold or
offered for sale in California, except those sold wholesale in
California for final retail sale outside the state and those
designed and sold exclusively for use in recreational vehicles
or other mobile equipment.
State Battery Charger Standards - In January 2012 the CEC
adopted minimum energy efficiency standards for battery chargers
commonly used to power cell phones, laptop computers, power
tools, and other devices. The new regulations require that each
charger have a permanent label ("BC" inside a circle) on the
product nameplate or retail packaging, and instructions if
included, to indicate compliance. According to CEC, there are
an estimated 170 million chargers in California households, an
average of 11 per household, and the new regulations will reduce
the wasted electricity from inefficient chargers by 40 percent.
CEC claims this will save nearly 2,200 GWh each year (or enough
energy to power nearly 350,000 homes or a city roughly the size
of Bakersfield), and once fully implemented save California
ratepayers more than $300 million annually and eliminate 1
million metric tons of carbon emissions.
Consumer chargers used in cell phones, personal care devices,
and power tools will be required to comply with the new
standards by February 1, 2013. Industrial charger compliance
such as forklifts and golf carts, is required by January 1,
2014. Compliance for small commercial chargers, such as walkie
talkies and portable barcode scanners, is required by January 1,
2017.
Federal Charger Standards - In March 2012, the DOE issued
proposed battery charger efficiency standards and a requirement
that each charger have a permanent label on the outside of its
housing to indicate compliance. The proposed federal label is a
"BC-III" inside a circle (the sample is a black circle with
white type, although the rules do not specify color
requirements), with the Roman numeral varied to specify the
following:
BC-I: meets no established standard
BC-II: meets a standard less stringent than DOE
standard
BC-III: meets DOE standard
BC-IV: meets a standard more stringent than DOE
standard
DOE's projected timeline indicates final adoption of its
regulations in early 2013 at the earliest with an effective date
that could be up to two years after adoption but no sooner than
July 2013 if they are finalized in early 2013. The presidential
election and potential change in administration could hinder
adoption by early 2013.
In comments filed in the federal rulemaking, CEC states that the
federal standards are significantly less stringent than the
California standards for several product classes and would
negatively impact the energy savings anticipated to be derived
by the California standards. CEC is actively urging DOE to
revise its cost-effective analysis and harmonize its
classification of product classes, compliance standards, and
label requirement with those adopted by CEC.
Appliance Standards Enforcement - Prior to January 1 of this
year, CEC did not have the authority to establish administrative
civil penalties for violations of appliance efficiency
standards. Chapter 591, Statutes of 2011 (SB 454, Pavley)
authorized CEC to establish an administrative enforcement
process. A 2009 survey of appliance efficiency standards
compliance conducted by the Heschong Mahone Group for CEC found
that approximately half of the appliances sold in California
have not been properly certified as meeting the standards. CEC
states that to enforce the new battery charger regulations, it
will contract out help to look in stores for products without
the label, and then send warning letters to manufacturers and
retailers. Additional steps will be taken according to
procedures adopted in its pending rulemaking to implement SB
454.
Legislation on TV Labels - In 2010, CEC adopted energy
efficiency standards for televisions that required a specified
power consumption label starting January 1, 2011. Because the
Federal Trade Commission (FTC) had proposed similar federal
regulations, SB 1198 (Huff, 2010) to delay the state requirement
for six months, which was chaptered. In October 2010, the FTC
adopted federal rules to be effective May 2011. SB 1198 thereby
was effective in allowing manufacturers to avoid duplicative
labeling requirements.
COMMENTS
1. Author's Purpose . According to the author, this
bill will delay the state battery charger labeling
requirement for six months until after a federal
requirement is expected, thereby relieving manufacturers
of a burdensome and duplicative regulation; authorize CEC
to repeal a regulation when it is no longer needed
without having to make a finding of cost effectiveness or
energy savings; require CEC to rely on the most current
data possible and whenever feasible rely on data no older
than one year prior to starting an efficiency standard
rulemaking in order to more closely identify real saving
in energy and GHG emissions; and provide that, for
confidential or proprietary business information that
would not otherwise be available to CEC, the parties
shall agree on the form and substance of the submission.
2. Delayed Effective Date . The California Electronics
Association, sponsor of the bill, and a coalition of
business interests state that "many of us have witnessed
serious flaws and shortcomings in the Energy Commission's
appliance efficiency standards process and approach.
These flaws and shortcomings relate directly to the
justification for regulations and the claims of energy
savings and emission reductions resulting from
regulations." This bill does not seek delay in the
effective date of CEC's actual efficiency standard for
consumer battery chargers, only the label requirement.
Manufacturers seek to avoid the cost of adopting a new
state-mandated label on consumer battery chargers for a
limited time and then relatively soon thereafter be
required by federal rules to change over to a different
label. They state the need for "avoiding additional,
unnecessary layers of regulation that hamper California
businesses in a challenging economy."
CEC, on the other hand, states that delay of the label
requirement impedes its ability to take enforcement
action against manufacturers not complying with the
underlying standards. Moreover, CEC states that it tried
to align the state label with what DOE was considering
and, now that DOE's label is officially proposed, is
actively urging DOE to align the federal label (and
underlying standards) with regulations. In the meantime,
however, the proposed federal label differs from the
already adopted state label.
CEC Adopted Label Federal Proposed Label
While SB 1198 is a model for this bill in that it
effectively avoided duplicative TV labeling requirements,
the effective date of federal battery charger regulations
is still highly speculative with July 1, 2013, being the
earliest possible date. Natural Resources Defense
Council (NRDC) and other environmental groups state that
they would support delay in the effective date of
California's label requirement to July 1, 2013, if the
language makes clear that the federal rules are adopted
by January 1, 2013, and effective July 1, 2013. This
would prevent delay in the effective date of state rules
if there is no realistic chance of federal rules being
effective by July 1, 2013. Thus, the author and
committee may wish to consider amending the bill to delay
the February 1, 2013, effective date of the state label
requirement only if, no later than February 1, 2013, DOE
has issued a decision adopting a federal label
requirement that shall take effect no later than July 1,
2013.
3. Repealing Regulation . This bill changes current law
that prohibits the CEC from increasing or decreasing any
minimum efficiency appliance standard for five years
after its adoption unless another cost-effective measure
for that appliance is adopted. Instead, it authorizes
CEC to increase or decrease a minimum efficiency standard
within five years if it "finds that the regulation is no
longer needed." CEC states that this would allow a
simple majority of commissioners to find that a
regulation is no longer needed for any reason and undo
the intent of the five-year requirement - to provide
stability and predictability for manufacturers and afford
enough time for efficiency measures to produce the
expected energy savings. Other parties say the five-year
requirement is too rigid. "No longer needed" is a very
low standard, and the bill makes no requirement to say
why a standard is no longer needed, counter to the
extensive public process and cost-effective analysis
necessary to adopt a standard.
4. Confidentiality of Manufacturer Data . Because
analysis of product sales is essential to a
cost-effective analysis, current law requires any
appliance manufacturer doing business in California to
submit information "as specified by the commission" so
CEC can study the effects of efficiency regulations on
sales of appliances. Current law makes this manufacturer
information confidential and not a public record, and
regulations further specify procedures for manufacturers
to request confidential treatment of proprietary data.
This bill provides that, for confidential and proprietary
business information that would not otherwise be
available to the CEC, the CEC and manufacturer shall
agree on the form and substance of the submission.
If this new provision applies to the same information
that manufacturers are required to submit "as specified
by the commission," then it would trump current law and
essentially give the manufacturer power to refuse to
submit data in response to a CEC request. If this
provision is intended to apply to information beyond what
current law requires manufacturers to submit, then it
would seem unnecessary because the manufacturer could
lawfully refuse to provide it if CEC did not agree to how
a manufacturer wants to submit it. In either case, the
manufacturer has the ability to protect confidential
information. Thus, the author and committee may wish to
consider amending the bill to strike this provision on
page 6, lines 37 to 40.
5. Old Data . This bill requires that, in adopting
efficiency standards, the CEC rely on the most current
data possible and, wherever feasible, rely on data no
older than one year prior to the commencement of the
formal rulemaking process. Although the "wherever
feasible" language provides some flexibility, a statutory
requirement that an agency "rely" on certain data seems
unduly restrictive, especially in the context of a
standard-setting process that takes more than a year. As
NRDC and CEC point out, the goal is that standards be
based upon the best, most complete and most appropriate
data for any particular standard. However, because the
most recent data often is the best, the author and
committee may wish to consider amending the bill to
require CEC to "consider" rather than "rely on" the most
current data and, whenever feasible, consider data no
older than one year prior to the commencement of the
formal rulemaking process.
ASSEMBLY VOTES
Assembly Floor (59-6)
Assembly Appropriations Committee (17-0)
Assembly Natural Resources Committee
(6-1)
POSITIONS
Sponsor:
Consumer Electronic Association
Support:
AT&T
CTIA-The Wireless Association
California Retailers Association
Consumer Electronics Association
Custom Electronic Design & Installation Association
National Electrical Manufacturers Association
Power Tool Institute
Satellite Broadcasting & Communications Association
Telecommunications Industry Association
Toy Industry Association
Oppose, unless amended:
Blue Green Alliance
Breathe California
Environment California
Natural Resources Defense Council
Pacific Gas and Electric Company
Sierra Club California
Jacqueline Kinney
AB 1850 Analysis
Hearing Date: July 3, 2012