BILL ANALYSIS                                                                                                                                                                                                    �




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair


          AB 2249 (Buchanan) - Solar energy.
          
          Amended: August 6, 2012         Policy Vote: E,U&C 10-0
          Urgency: No                     Mandate: Yes
          Hearing Date: August 6, 2012                      Consultant: 
          Bob Franzoia  
          
          This bill meets the criteria for referral to the Suspense File.


          Bill Summary: AB 2249 would expand eligibility for incentives 
          under the California Solar Initiative CSI thermal program to 
          include multifamily residential, governmental, educational, and 
          nonprofit solar pool heating systems.

          Fiscal Impact: $166,000 from the Public Utilities Reimbursement 
          Account in 2012-13 and 2013-14 to the Public Utilities 
          Commission to implement expanded program eligibility 
          requirements.
           $120,000 annually beginning 2014-15 to monitor the program and 
            ensure that the new requirements are met by the utilities' 
            program administrators.
           Unknown, likely major accelerated CSI thermal program 
            expenditures annually.

          Background: In 2007, the commission established the CSI, a $2.16 
          billion ratepayer funded incentive program with a goal of 
          installing 1,940 megawatts of generation and creating a 
          sustainable solar industry.  The thermal program (natural gas 
          displacing) has a balance of approximately $240 million.

          Proposed Law: This bill would expand eligibility for incentives 
          to multifamily residential, governmental, educational, and 
          nonprofit solar pool heating systems.  Single family residential 
          systems would remain ineligible.

          This bill would require the commission to (1) determine an 
          appropriate division of funds between solar water heating 
          systems and solar pool heating systems (2) complete a review of 
          whether the rebate levels established by the commission will be 
          sufficient to spur investment to reach the goals of the program 
          and to report the results to the Legislature by no later than 








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          July 1, 2013 and (3) direct gas corporations or third-party 
          administrators to implement the program changes made by this 
          bill no later than July 1, 2013 and marketing of the program as 
          revised commencing by August 1, 2013.

          Staff Comments: In general, requiring entities to complete 
          relatively complex tasks within six months of the effective date 
          of a bill will result in increased costs.  Staff recommends this 
          bill be amended to change reporting and implementation date from 
          July 1, 2013 to January 1, 2014.  Also, it is unclear why 
          language stating it is the intent of the Legislature that the 
          solar water heating system incentives should be a cost effective 
          investment by gas customers is being struck.  This would be 
          inconsistent with other commission market support programs which 
          require ratepayer benefit.