BILL ANALYSIS �
AB 2390
Page 1
Date of Hearing: May 16, 2012
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Felipe Fuentes, Chair
AB 2390 (Chesbro) - As Amended: May 1, 2012
Policy Committee: Natural
ResourcesVote:7-1
Utilities and Commerce 11-0
Urgency: No State Mandated Local Program:
No Reimbursable: No
SUMMARY
This bill requires the California Energy Commission (CEC), in
consultation with the Department of Forestry and Fire Protection
(CAL FIRE), to establish an incentive program to compensate
producers and collectors of biomass material associated with
forest fuel reduction and fire prevention activities that are
delivered to eligible biomass facilities for use as a fuel
source.
FISCAL EFFECT
1)Cost pressure of an unknown amount, but potentially in the
millions of dollars, to fund incentives for biomass producers
and collectors (special fund, bond funds.)
2)Annual costs of approximately $300,000 (equivalent to two
staff members) to CEC to develop and implement the incentive
program (special fund).
3)Minor, absorbable costs to CAL FIRE to consult with CEC.
COMMENTS
1)Rationale . The author contends this bill will reduce the risk
of forest fire and related costs to electricity utility
ratepayers resulting from damage to electricity
infrastructure, while encouraging realization of the state's
renewable energy goals.
2)Background. Current statute requires the state's electricity
AB 2390
Page 2
utilities and certain electricity providers to procure at
least 33% of of their electricity from renewable energy
resources by 2020 and establishes obligatory renewable energy
procurement milestones prior to this date. This requirement
is known as the renewable portfolio standard (RPS).
Statute defines, for RPS purposes, eligible renewable energy
sources to include, among other sources, biomass, such as wood
and wood waste from timbering operations. Statute also
establishes a "balanced portfolio" requirement, classifying
renewable energy products based upon their location and other
characteristics, eventually requiring that 75% of renewable
energy products be directly connected or scheduled into the
California electricity grid.
Until recently, biomass generation facilities received funding
from an electricity bill surcharge, known as the Public Goods
Charge (PGC). In late 2011, the PGC expired without
legislative reauthorization. PGC funding, including funding
for biomass, will soon be exhausted.
3)Support . This bill is supported by, among others, the
Independent Energy Producers (sponsor) and other industry
groups that could benefit financially from funding the
production and collection of biomass or from using it for
energy production.
4)Opposition. This bill is opposed by Southern California
Edison, who objects to the technology-specific carve out and
to its failure to identify a funding source.
Analysis Prepared by : Jay Dickenson / APPR. / (916) 319-2081