BILL ANALYSIS � 1
SENATE ENERGY, UTILITIES AND COMMUNICATIONS COMMITTEE
ALEX PADILLA, CHAIR
AB 2075 - Fong Hearing Date:
June 11, 2012 A
As Amended: March 29, 2012 Non-FISCAL B
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DESCRIPTION
Current law vests the California Energy Commission (CEC) with
exclusive certification jurisdiction over thermal powerplants
with a generating capacity of 50 megawatts (MW) or more, and any
appurtenant facilities, and permits a developer of a thermal
powerplant with a generating capacity of less than 50 MW to
voluntarily submit to the CEC's exclusive certification
jurisdiction.
Current law excludes from the definition of a thermal powerplant
any wind, hydroelectric, or solar photovoltaic (PV) electrical
generating facility.
Current law authorizes the CEC to retain jurisdiction over
specified solar thermal powerplants where the owner seeks an
amendment to the certification to convert the electric
generating facility to PV thus avoiding the necessity of filing
a new application with a local jurisdiction.
This bill clarifies current law which restricts the CEC from
accepting applications to site non-thermal powerplants.
This bill prohibits the CEC from accepting siting permits for
thermal generation projects sized less than 50 MW.
BACKGROUND
CEC Siting Process - The CEC performs the siting review function
for all large thermal powerplants, including concentrated solar
thermal, natural gas combined cycle, and geothermal powerplants.
It is a one-stop shop wherein all state, local, and regional
environmental reviews are completed. The process begins with an
Application for Certification (AFC) by the powerplant developer.
Once complete the CEC staff reviews the project and issues a
Preliminary Staff Assessment (PSA), which contains their
analysis of the engineering, environmental, public health and
safety aspects of the project. The PSA determines if the
project conforms to all applicable laws, ordinances, regulations
and standards. Upon identifying any potentially significant
environmental impacts, the PSA recommends mitigation measures in
the form of conditions of certification for construction,
operation, and closure of the project. The PSA is issued for
public comment and is revised, if warranted, and reissued as a
Final Staff Assessment (FSA). This document is subject to
formal public hearings before CEC Commissioners. The five
member CEC may accept or revise the FSA, which is voted on in a
public meeting.
Changing Market Conditions - Solar thermal generation uses
mirrors or lenses to concentrate a large area of sunlight, or
solar thermal energy, onto a small area. Electrical power is
produced when the concentrated light is converted to heat, which
drives a heat engine (usually a steam turbine) connected to an
electrical power generator. This thermal technology is
distinctly different from solar photovoltaic (PV). The CEC has
exclusive jurisdiction over solar thermal projects sized greater
than 50 MW. Cities and counties have siting jurisdiction for
solar PV projects of any size.
Since 2007 the CEC has received project applications from
developers of 16 solar thermal plants collectively totaling over
5,700 MW of generation primarily located in the Mojave and
Colorado desert regions of Southern California. However as the
siting process neared completion for some of these projects, and
in some instances after an application had been certified by the
CEC, market prices for solar PV dropped so precipitously that
some solar thermal project developers desired to change
technologies seeking a lower cost of power generated from the
plant. Had the developers began the siting process with PV they
would have been required to gain siting approvals from the city
or county in which the project was located. But because the CEC
had already done much, if not all of the work required for
siting the solar thermal projects, a question was raised as to
whether the project applicant should be required to begin the
siting process all over again at the local level or whether the
CEC had the authority to accept an amended application from the
developer to convert the plant to PV.
In response the Legislature adopted SB 226 (Simitian, 2011)
which provided the CEC with limited jurisdiction over PV
projects which were filed after August 15, 2007 and approved by
the CEC and for projects on federal land where a decision had
been issued by the Bureau of Land Management before September 1,
2011. The one caveat was that a project would not qualify for
the exception if the project had been challenged in court. The
author of the bill submitted a letter to the Senate Daily
Journal expressing his intent that this limitation did not apply
to a project which was challenged in court but subsequently
dismissed and legislation was adopted this spring to codify that
intent (AB 1073 �Fuentes]).
Ridgecrest - A proposed decision (PD) of the CEC on a siting
application referred to as Ridgecrest has drawn fire. It is
germane to this bill because the PD asserted that the CEC has
the authority to allow any project developer of any non-thermal
electric generation facilities in the state to voluntarily
utilize the CEC's siting process.
At issue in Ridgecrest is the conversion of a solar thermal
plant to PV and the CEC's siting jurisdiction. The law prior to
SB 226 and AB 1073, and still in effect, does provide for an
exception for a project developer to "voluntarily" file an
application with the CEC for any facility excluded from the
CEC's specific statutory authority which the PD argues includes
PV.
Current law defines a "facility" as a thermal powerplant and a
"thermal powerplant" is defined as a plant of 50 MW or more.
The committee and the Office of the Legislative Counsel opines
that the CEC's jurisdictional exception is one for plants under
50 MW in size, not for any non-thermal plant. Legislative
history approving SB 226 and AB 1073 are consistent with this
interpretation.
COMMENTS
1. Author's Purpose . According to the author, AB 2075
would repeal an outdated provision of the law that allows a
person proposing to construct a facility excluded from the
CEC's jurisdiction to waive the exclusion and submit a
notice of intent to file an application for certification.
This is the provision the Ridgecrest developer relied on in
the CEC hearing.
The original intent of this provision was to provide a
"grandfather" option for applications in the pipeline when
Public Resources Code �� 25501 and 25501.5 were adopted in
1974. Since there are no longer any applications in the 38
year old pipeline and � 25501.5 was subsequently repealed.
This provision should be repealed as well, to clarify
jurisdictional responsibilities between the CEC and local
governments.
2. CEC Taking License ? The CEC's PD in Ridgecrest has
alarmed cities and counties as well as the environmental
community and some project developers because it would
circumvent the local decision-making process. They opine
that local jurisdictions are the better forum to weigh the
local impacts of projects and the need to encourage the
development of large renewable energy projects.
These same groups have expressed their opposition to the
CEC's PD in Ridgecrest and provided contrary legal opinions
as to the CEC's jurisdiction. To date, the CEC's PD
remains an open issue. It has not been acted on nor is
there any indication when and if it will be.
The purpose of this bill is to reinforce to the CEC that
current law does not permit the CEC to voluntarily accept
siting applications for non-thermal electric generation.
It is also important to note that the CEC's siting division
is not funded to accommodate the additional responsibility
of siting non-thermal powerplants. Although thermal
developers do pay licensing fees, those fees are not
sufficient to cover the full agency costs of siting the
projects. Consequently, siting is subsidized by electric
ratepayers through the surcharges that all gas and electric
customers pay to the agency through fees on their utility
bills and the CEC would face adverse budget impacts if it
routinely accepted applications for non-thermal plants.
3. Local Barriers to Siting . Some project developers are
concerned that this bill may foreclose an avenue of last
resort for securing siting approval when they face
challenges at the local level. On its face this argument
creates the impression that the project developers could be
forum-shopping. However, the Large Scale Solar Association
reports that there are at least 22 solar PV projects in
Riverside County totaling more than 4,500 MWs which have
been stalled due to issues unrelated to the environmental
impacts of siting the projects.
Rather than completely foreclosing the opportunity for a
project developer of a non-thermal powerplant from
utilizing the CEC process, in cases where disputes have
arisen at the local level not related to the impacts of the
proposed project, the committee may wish to consider
permitting a project developer to file an application for
jurisdictional waiver with the CEC, to be voted on by the
full commission, which would allow the CEC to accept the
siting application for a non-thermal power plant if the CEC
finds that a county is acting in an arbitrary and
capricious manner and the project applicant fully covers
the CEC siting costs.
ASSEMBLY VOTES
Assembly Floor (74-0)
Assembly Natural Resources Committee
(9-0)
POSITIONS
Sponsor:
Sierra Club California
Defender of Wildlife
Support:
American Planning Association of California
California Farm Bureau Federation
California State Association of Counties
California Wind Energy Association
County of Inyo
County of Riverside, Board of Supervisors
County of San Benito, Board of Supervisors
County of San Bernardino
Kern County Board of Supervisors
League of California Cities
Regional Council of Rural Counties
Urban Counties Caucus
Oppose:
Independent Energy Producers Association
Large-scale Solar Association
Kellie Smith
AB 2075 Analysis
Hearing Date: June 11, 2012