BILL ANALYSIS                                                                                                                                                                                                    �




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair


          AB 2409 (Allen) - Energy efficiency: financing: review.
          
          Amended: June 26, 2012          Policy Vote: E,U&C 12-0
          Urgency: No                     Mandate: No
          Hearing Date: August 16, 2012                     Consultant: 
          Bob Franzoia  
          
          SUSPENSE FILE.


          Bill Summary: AB 2409 would require the California Energy 
          Commission (commission) to review emerging technology financing 
          models used in other states to finance energy efficiency 
          technology deployments and services that maximize private sector 
          investment in California.  The commission would be authorized to 
          establish and consult with an investment advisory group 
          consisting of private and public investors.

          Fiscal Impact: Estimated $250,000 by first quarter of 2013 from 
          the Energy Resources Programs Account (General Fund) for the 
          commission to review and report in time for the 2012/13 update.
              Estimated $100,000 to $200,000 biennially from the Energy 
              Resources Programs Account (General Fund) for the commission 
              to review and report. The next full integrated energy policy 
              report is planned for release in the last quarter of 
              2013/first quarter of 2014.
              Likely minor costs biennially from various special funds to 
              collaborate with the commission to review and report.

          Background: Pursuant to Public Resources Code 25302, beginning 
          November 1, 2003, and every two years thereafter, the commission 
          shall adopt an integrated energy policy report. This integrated 
          report shall contain an overview of major energy trends and 
          issues facing the state, including, but not limited to, supply, 
          demand, pricing, reliability, efficiency, and impacts on public 
          health and safety, the economy, resources, and the environment.

          Proposed Law: This bill would require the commission to examine 
          all of the following:

          (1) Long-term financing options, including, but not limited to, 
          establishing, facilitating, or improving bonding authority to 








          AB 2409 (Allen)
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          provide tax-exempt bonds, private activity bonds, or private 
          investment bonds.
          (2) Potential financing models for implementing shared savings 
          agreements between purchasers and sellers of energy efficiency 
          technologies.
          (3) Potential financing models to finance energy efficiency 
          improvements for state infrastructure and equipment.
          (4) Potential financing models to finance residential and 
          business energy efficiency improvements.


          Staff Comments: The Energy Resources Programs Account 
          (3360-0465) is funded by a surcharge on electricity use of up to 
          three-tenths of a mill ($0.0003) surcharge per kilowatt hour.  
          (This account is considered a "mixed" account as it contains 
          General Funds and a small amount of special funds in the form of 
          permit fees).  Funds in the account may be used for the program 
          proposed in this bill.
            
          Due to the economic recession, energy use in the state has 
          declined, reducing revenues into the account.  In the fall of 
          2010, the commission raised the surcharge to $0.00029.  The 
          estimated account balance for 2012-13 is $15,786,000, down from 
          $18,986,000 in 2011-12 and $19,371,000 in 2010-11.