BILL ANALYSIS                                                                                                                                                                                                    �



                                                                  AB 2339
                                                                  Page  1

          Date of Hearing:   May 16, 2012

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                Felipe Fuentes, Chair

                    AB 2339 (Williams) - As Amended:  May 2, 2012 

          Policy Committee:                              
          UtilitiesVote:12-1
                        Natural Resources                       9-0

          Urgency:     No                   State Mandated Local Program: 
          No     Reimbursable:               

           SUMMARY  

          This bill requires the California Energy Commission (CEC), by 
          July 1, 2013, and in consultation with other parties, to 
          evaluate state policies for overcoming barriers to the 
          widespread deployment of geothermal heat pump and geothermal 
          ground loop technologies, and, in this regard, to consider the 
          benefits and costs to ratepayers, the impact of existing 
          statutory and permit requirements, and the impact on achieving 
          the state's greenhouse gas reduction and energy efficiency 
          goals.

           FISCAL EFFECT  

          One-time special fund costs of about $100,000 for the CEC to 
          complete the study, which will be absorbed within the balance of 
          the Public Interest Energy Research (PIER) funds.

           COMMENTS  

           Background and Purpose  . Geothermal heat pumps can be sized to 
          heat and cool any building, in any climate. A series of plastic 
          pipes, called ground loops, are buried underground at a depth 
          where temperatures are constant between 40 degrees and 80 
          degrees throughout the year, depending on a particular location. 
          The pipes are sealed tight and connected to a heating and 
          cooling system inside the building. Water circulates through the 
          underground pipes. During summer months, unwanted heat indoors 
          is transferred outside through water in the pipes for cooling by 
          the earth. The cool water is then circulated to the geothermal 
          system indoors to provide air conditioning. During the winter, 








                                                                  AB 2339
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          the process is reversed. 

          According to the author, geothermal heat pumps and solar heating 
          and cooling technologies can play an important role in reducing 
          electricity demand and increasing energy efficiency. Last year, 
          the CEC released a study, "Overcoming Barriers to Ground Source 
          Heat Pumps in California," which identified the following 
          constraints on increased use of ground source heat pumps: little 
          awareness of this technology by consumers, industry and, 
          government and high first costs. Compared to other states, 
          California also has significant regulatory barriers, which 
          include inconsistent permitting, confused work classifications 
          and fee schedules, aggressive licensing requirements, and gaps 
          of knowledge in local jurisdictions.

           Analysis Prepared by  :    Chuck Nicol / APPR. / (916) 319-2081