BILL ANALYSIS �
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THIRD READING
Bill No: SB 682
Author: Calderon (D)
Amended: 5/25/11
Vote: 21
SENATE ENERGY, UTIL. & COMM. COMMITTEE : 9-1, 4/28/11
AYES: Padilla, Fuller, Corbett, De Le�n, DeSaulnier,
Pavley, Rubio, Simitian, Wright
NOES: Strickland
NO VOTE RECORDED: Berryhill
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
SUBJECT : Electricity generation: emissions
SOURCE : California Independent Petroleum Association
DIGEST : This bill requires the Air Resources Board to
develop an assessment of the extent and magnitude of
potential greenhouse gas emission reductions associated
with using waste or stranded gas for electricity
generation. The state board shall provide a copy of the
assessment to the Senate Committee on Energy, Utilities and
Communications, the Senate Committee on Environmental
Quality, the Assembly Committee on Natural Resources, and
the Assembly Committee on Utilities and Commerce.
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ANALYSIS :
Existing law
1. Directs the CPUC to adopt tariffs and standard
contracts (aka feed-in-
tariff or FIT) for the purchase of eligible renewable
generation for
projects sized to 3 MW from customers and generators
located in the
territories of the state's electrical corporations
(IOUs) and local publicly
owned utilities (POUs).
2. Directs the CPUC to establish a FIT for the purchase of
excess electricity
generated from combined heat and power units with a
generating capacity
of not more than 20 megawatts and that meet specified
emissions and
efficiency standards.
3. Requires the Air Resources Board (ARB) to issue
guidance to local air
districts on the permitting or certification of
electrical generation
technologies that address best available control
technology
determinations.
Background
Feed-In-Tariffs
These contracts present a simple mechanism for customers
and generators who generate eligible renewable resources to
sell power to a utility at predefined terms and conditions,
without contract negotiations. The FIT operates as a "must
take" contract in a utility's renewable portfolio. That is,
if the power is generated the utility must take it at
predefined terms and prices. The CPUC has implemented FITs
for renewable generation facilities sized up to 1.5 MW and
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is in the process of implementing SB 32 (Negrete-McLeod,
2009) which expanded the eligible system size up to 3 MW
for 10, 15, or 20 year contract periods. The program is a
subset of the RPS program.
FITs were also mandated by the Legislature in 2007 for
combined heat and power (CHP) that is sometimes referred to
as cogeneration. Those tariffs are also pending
implementation by the CPUC. Normally natural gas is used
as the fuel source for CHP.
Combined heat and power technologies produce both
electricity and steam from a single fuel at a facility
located near the consumer. These efficient systems recover
heat that normally would be wasted in an electricity
generator, and save the fuel that would otherwise be used
to produce heat or steam in a separate unit. CHP not only
avoids electricity produced at remote power plants, it
displaces electricity or gas used for onsite heating or
cooling. The combined thermal efficiency benefits of CHP at
the point of use can be significant. The state's current
standard is that gas-fired CHP plants must have a combined
thermal efficiency of 60%.
Prior Legislation . SB 1465 (Lowenthal, 2010), established
a FIT for generation that uses a microturbine with a
generating capacity of not more than one megawatt that runs
off of waste or standard gas associated with the extraction
of oil or gas. Dropped by author.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
SUPPORT : (5/24/11)
ARGUMENTS IN SUPPORT : According to the author's office,
in many cases throughout California, large amounts of waste
gas are produced that, when run through a turbine or fuel
cell, could provide more electricity than is needed for a
particular facility. However, because the excess
electricity generated can only be sold to the utilities,
which have not been willing to purchase the power or charge
price-deterring interconnection fees, the gas is flared.
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The result of these conditions renders any capital
investment in cleaner, more efficient uses of waste gas
uneconomical. Current PUC rules allow for net metering, but
any electricity generated above that required by the
operator requires offloading the electricity. In these
cases, the producer pays the utility instead of the utility
paying the producer.
RM:rm 5/23/11 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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