Bill Text: CA AB1551 | 2009-2010 | Regular Session | Chaptered
Bill Title: Energy: program eligibility and costs.
Spectrum: Moderate Partisan Bill (Democrat 8-2)
Status: (Passed) 2009-10-11 - Chaptered by Secretary of State - Chapter 336, Statutes of 2009. [AB1551 Detail]
Download: California-2009-AB1551-Chaptered.html
BILL NUMBER: AB 1551 CHAPTERED
BILL TEXT
CHAPTER 336
FILED WITH SECRETARY OF STATE OCTOBER 11, 2009
APPROVED BY GOVERNOR OCTOBER 11, 2009
PASSED THE SENATE AUGUST 27, 2009
PASSED THE ASSEMBLY AUGUST 31, 2009
AMENDED IN SENATE AUGUST 25, 2009
AMENDED IN SENATE JULY 16, 2009
AMENDED IN SENATE MAY 27, 2009
INTRODUCED BY Committee on Utilities and Commerce (Fuentes (Chair),
Blakeslee, Buchanan, Carter, Fong, Furutani, Huffman, Krekorian,
Smyth, and Torrico)
MARCH 10, 2009
An act to amend Sections 26003 and 26011 of the Public Resources
Code, and to amend Sections 747, 2827.10, and 2852 of the Public
Utilities Code, relating to energy, and declaring the urgency
thereof, to take effect immediately.
LEGISLATIVE COUNSEL'S DIGEST
AB 1551, Committee on Utilities and Commerce. Energy: program
eligibility and costs.
(1) The California Alternative Energy and Advanced Transportation
Financing Authority Act established the California Alternative Energy
and Advanced Transportation Financing Authority. The act defines the
term "alternative sources" to mean the application of cogeneration
technology, the conservation of energy, and the use of specified
renewable energy sources under 30 megawatts, or other sources of
energy that reduce the use of fossil and nuclear fuels and are
intended primarily to offset part or all of a customer's own
electrical requirements. The authority is authorized to purchase
alternative source energy or projects for sale to a specified
participating party and to make a loan to a participating party to
purchase alternative source energy or projects by entering into
various specified instruments including prepayment purchase
contracts.
This bill would change the definition of "alternative sources" by
deleting the requirement that the energy sources be intended
primarily to offset part or all of a customer's own electrical
requirements. The bill would require the authority to enter into a
prepayment contract with a participating party only for energy
derived from an alternative source to the extent the prepayment is
for energy intended to primarily offset part or all of the authority'
s or a participating party's own electrical requirements.
(2) A decision of the Public Utilities Commission (PUC) adopted
the California Solar Initiative. Existing law requires the PUC to
undertake certain steps in implementing the California Solar
Initiative, defines what is an eligible solar energy system for
purposes of the program, and regulates the use of funds under the
California Solar Initiative, including ensuring that not less than
10% of the funds for the California Solar Initiative are utilized for
the installation of solar energy systems on low-income residential
housing, defined to include, among other housing, a multifamily
residential complex in which at least 20% of the total units are sold
or rented to lower income households and those units are subject to
a deed restriction or affordability covenant with a public entity
that ensures those units' affordability for a period of at least 30
years.
This bill would revise and recast the definition of "low-income
residential housing" for the purposes of the California Solar
Initiative.
(3) Existing law requires every electrical corporation, as
defined, to file with the PUC a standard tariff providing net energy
metering for eligible fuel cell customer-generators. Under existing
law, a fuel cell electrical generating facility, as defined, is
eligible for participation in the tariff if its operation commenced
before January 1, 2010.
This bill would extend this eligibility to January 1, 2014.
(4) Existing law requires the PUC to prepare a written report for
the Governor and the appropriate policy committees of the
Legislature, on an annual basis, regarding the costs of specified
programs and activities conducted by electrical or gas corporations
that have more than a specified number of customers in California.
Existing law requires the report to be completed and submitted no
later than February 1 of each year.
This bill instead would require that report to be completed and
submitted no later than May 31 of each year.
(5) This bill would declare that it is to take effect immediately
as an urgency statute.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 26003 of the Public Resources Code is amended
to read:
26003. As used in this division, unless the context otherwise
requires:
(a) "Authority" means the California Alternative Energy and
Advanced Transportation Financing Authority established pursuant to
Section 26004, and any board, commission, department, or officer
succeeding to the functions of the authority, or to which the powers
conferred upon the authority by this division shall be given.
(b) "Cost" as applied to a project or portion of the project
financed under this division means all or part of the cost of
construction and acquisition of all lands, structures, real or
personal property or an interest in the real or personal property,
rights, rights-of-way, franchises, easements, and interests acquired
or used for a project; the cost of demolishing or removing any
buildings or structures on land so acquired, including the cost of
acquiring any lands to which those buildings or structures may be
moved; the cost of all machinery, equipment, and furnishings,
financing charges, interest prior to, during, and for a period after,
completion of construction as determined by the authority; the cost
of the purchase or sale of energy derived from an alternative source
pursuant to subdivision (g) of Section 26011; provisions for working
capital; reserves for principal and interest and for extensions,
enlargements, additions, replacements, renovations, and improvements;
the cost of architectural, engineering, financial, accounting,
auditing and legal services, plans, specifications, estimates,
administrative expenses, and other expenses necessary or incident to
determining the feasibility of constructing any project or incident
to the construction, acquisition, or financing of a project.
(c) (1) "Alternative sources" means the application of
cogeneration technology, as defined in Section 25134; the
conservation of energy; or the use of solar, biomass, wind,
geothermal, hydroelectricity under 30 megawatts, or any other source
of energy, the efficient use of which will reduce the use of fossil
and nuclear fuels.
(2) "Alternative sources" does not include a hydroelectric
facility that does not meet state laws pertaining to the control,
appropriation, use, and distribution of water, including, but not
limited to, the obtaining of applicable licenses and permits.
(d) "Advanced transportation technologies" means emerging
commercially competitive transportation-related technologies
identified by the authority as capable of creating long-term, high
value-added jobs for Californians while enhancing the state's
commitment to energy conservation, pollution reduction, and
transportation efficiency. Those technologies may include, but are
not limited to, any of the following:
(1) Intelligent vehicle highway systems.
(2) Advanced telecommunications for transportation.
(3) Command, control, and communications for public transit
vehicles and systems.
(4) Electric vehicles and ultralow-emission vehicles.
(5) High-speed rail and magnetic levitation passenger systems.
(6) Fuel cells.
(e) "Financial assistance" includes, but is not limited to,
either, or any combination, of the following:
(1) Loans, loan loss reserves, interest rate reductions, proceeds
of bonds issued by the authority, insurance, guarantees or other
credit enhancements or liquidity facilities, contributions of money,
property, labor, or other items of value, or any combination thereof,
as determined by, and approved by the resolution of, the board.
(2) Any other type of assistance the authority determines is
appropriate.
(f) "Participating party" means either of the following:
(1) A person or an entity or group of entities engaged in business
or operations in the state, whether organized for profit or not for
profit, that does either of the following:
(A) Applies for financial assistance from the authority for the
purpose of implementing a project in a manner prescribed by the
authority.
(B) Participates in the purchase or sale of energy derived from an
alternative source pursuant to subdivision (g) of Section 26011.
(2) A public agency or nonprofit corporation that does either of
the following:
(A) Applies for financial assistance from the authority for the
purpose of implementing a project in a manner prescribed by the
authority.
(B) Participates in the purchase or sale of energy derived from an
alternative source pursuant to subdivision (g) of Section 26011.
(g) "Project" means a land, building, improvement to the land or
building, rehabilitation, work, property, or structure, real or
personal, stationary or mobile, including, but not limited to,
machinery and equipment, whether or not in existence or under
construction, that utilizes, or is designed to utilize, an
alternative source, or that is utilized for the design, technology
transfer, manufacture, production, assembly, distribution, or service
of advanced transportation technologies, or an arrangement for the
purchase, including prepayment, or sale of energy derived from an
alternative source pursuant to subdivision (g) of Section 26011.
(h) "Public agency" means a federal or state agency, department,
board, authority, state or community college, university, or
commission, or a county, city and county, city, regional agency,
public district, school district, or other political entity.
(i) (1) "Renewable energy" means a device or technology that
conserves or produces heat, processes heat, space heating, water
heating, steam, space cooling, refrigeration, mechanical energy,
electricity, or energy in any form convertible to these uses, that
does not expend or use conventional energy fuels, and that uses any
of the following electrical generation technologies:
(A) Biomass.
(B) Solar thermal.
(C) Photovoltaic.
(D) Wind.
(E) Geothermal.
(2) For purposes of this subdivision, "conventional energy fuel"
means any fuel derived from petroleum deposits, including, but not
limited to, oil, heating oil, gasoline, fuel oil, or natural gas,
including liquefied natural gas, or nuclear fissionable materials.
(3) Notwithstanding paragraph (1), for purposes of this section,
"renewable energy" also means ultralow-emission equipment for energy
generation based on thermal energy systems such as natural gas
turbines and fuel cells.
(j) "Revenue" means all rents, receipts, purchase payments, loan
repayments, and all other income or receipts derived by the authority
from a project, or the sale, lease, or other disposition of
alternative source or advanced transportation technology facilities,
or the making of loans to finance alternative source or advanced
transportation technology facilities, and any income or revenue
derived from the investment of money in any fund or account of the
authority.
SEC. 2. Section 26011 of the Public Resources Code is amended to
read:
26011. The authority is authorized and empowered:
(a) To adopt an official seal.
(b) To sue and be sued in its own name.
(c) To issue bonds, notes, bond anticipation notes, and other
obligations of the authority, including, at the option of the
authority, obligations bearing interest that is taxable for purposes
of federal income taxation, for any of its purposes and to fund or
refund the same, all as provided in this division.
(d) To determine the location and character of a project to be
financed under the provisions of this division, to lend financial
assistance to a participating party, to enter into loan agreements
with a participating party for the financing of a project including
creating a lien or security interest in the property, to construct,
reconstruct, renovate, replace, lease, as lessor or lessee, and
regulate the same, and to enter into contracts for the sale of a
project, including installment sales or sales under conditional sales
contracts.
(e) To fix fees and charges for projects, and interest rates with
respect to loans for projects, and to revise from time to time the
fees and charges and interest rates, and to collect rates, rents,
fees, and charges for the use of, and for a facility or service
furnished, or to be furnished, by a project or part of the project
and to contract with a person, partnership, association, corporation,
or public agency with respect to the project, and to fix the terms
and conditions upon which a project may be sold or disposed of,
whether upon installment sales contracts or otherwise.
(f) To employ and fix the compensation of bond counsel, financial
consultants, and advisers as may be necessary in its judgment in
connection with the issuance and sale of any bonds, notes, bond
anticipation notes, or other obligations of the authority; to
contract for engineering, architectural, accounting, or other
services of appropriate state agencies as may be necessary in the
judgment of the authority for the successful development of a
project; and to pay the reasonable costs of consulting engineers,
architects, accountants, and construction experts employed by a
participating party if, in the judgment of the authority, the
services are necessary to the successful development of a project,
and the services are not obtainable from a state agency.
(g) To purchase alternative source energy or projects from a
person or entity for sale to a participating party, or to make a loan
to a participating party to purchase alternative source energy or
projects, or to purchase from a person or entity that has contracted
to sell alternative source energy to a participating party the right
to receive purchase payments and related rights under that contract
or any related contracts. Notwithstanding any other applicable law,
the authority and a public agency, for purposes of a program or
financing, shall have the power to enter into contractual
arrangements and related agreements or instruments, including,
without limitation, a prepayment purchase contract, lease, loan,
construction, security, operation and maintenance, or other agreement
or instrument, with the authority or with a participating party,
upon the terms and subject to the conditions that may be necessary or
convenient to accomplish the purposes of this subdivision. The
authority shall only enter into a prepayment contract with a
participating party for energy derived from an alternative source to
the extent the prepayment is for energy intended to primarily offset
part or all of the authority's or a participating party's own
electrical requirements.
(h) To do all things generally necessary or convenient to carry
out the purposes of this division.
SEC. 3. Section 747 of the Public Utilities Code is amended to
read:
747. (a) It is the intent of the Legislature that the commission
reduce rates for electricity and natural gas to the lowest amount
possible.
(b) The commission shall prepare a written report on the costs of
programs and activities conducted by each electrical corporation and
gas corporation that is subject to this section, including activities
conducted to comply with their duty to serve. The report shall be
completed on an annual basis before May 31 of each year, and shall
identify, clearly and concisely, all of the following:
(1) Each program mandated by statute and its annual cost to
ratepayers.
(2) Each program mandated by the commission and its annual cost to
ratepayers.
(3) Energy purchase contract costs and bond-related costs incurred
pursuant to Division 27 (commencing with Section 80000) of the Water
Code.
(4) All other aggregated categories of costs currently recovered
in retail rates as determined by the commission.
(c) As used in this section, the reporting requirements apply to
electrical corporations with at least 1,000,000 retail customers in
California and gas corporations with at least 500,000 retail
customers in California.
(d) The report required by subdivision (b) shall be submitted to
the Governor and the Legislature no later than May 31 of each year.
(e) The commission shall post the report required by subdivision
(b) in a conspicuous area of its Internet Web site.
SEC. 4. Section 2827.10 of the Public Utilities Code is amended to
read:
2827.10. (a) As used in this section, the following terms have
the following meanings:
(1) "Electrical corporation" means an electrical corporation, as
defined in Section 218.
(2) "Eligible fuel cell electrical generating facility" means a
facility that includes the following:
(A) Integrated powerplant systems containing a stack, tubular
array, or other functionally similar configuration used to
electrochemically convert fuel to electric energy.
(B) An inverter and fuel processing system where necessary.
(C) Other plant equipment, including heat recovery equipment,
necessary to support the plant's operation or its energy conversion.
(3) "Eligible fuel cell customer-generator" means a customer of an
electrical corporation that meets all the following criteria:
(A) Uses a fuel cell electrical generating facility with a
capacity of not more than one megawatt that is located on or adjacent
to the customer's owned, leased, or rented premises, is
interconnected and operates in parallel with the electric grid while
the grid is operational or in a grid independent mode when the grid
is nonoperational, and is sized to offset part or all of the eligible
fuel cell customer-generator's own electrical requirements.
(B) Is the recipient of local, state, or federal funds, or who
self-finances projects designed to encourage the development of
eligible fuel cell electrical generating facilities.
(C) Uses technology that meets the definition of an "ultra-clean
and low-emission distributed generation" in subdivision (a) of
Section 353.2.
(4) "Net energy metering" has the same meaning as that term is
defined in Section 2827.9.
(b) Every electrical corporation shall, not later than March 1,
2004, file with the commission a standard tariff providing for net
energy metering for eligible fuel cell customer-generators,
consistent with this section. Every electrical corporation shall make
this tariff available to eligible fuel cell customer-generators upon
request, on a first-come-first-served basis, until the total
cumulative rated generating capacity used by the eligible fuel cell
customer-generators equals 45 megawatts within the service territory
of the electrical corporation for an electrical corporation with a
peak demand above 10,000 megawatts, or equals 22.5 megawatts within
the service territory of the electrical corporation for an electrical
corporation with a peak demand of 10,000 megawatts or below. The
combined statewide cumulative rated generating capacity used by the
eligible fuel cell customer-generators in the service territories of
all electrical corporations in the state may not exceed 112.5
megawatts.
(c) In determining the eligibility for the cumulative rated
generating capacity within an electrical service area, preference
shall be given to facilities which, at the time of installation, are
located in a community with significant exposure to air contaminants
or localized air contaminants, or both, including, but not limited
to, communities of minority populations or low-income populations, or
both, based on the ambient air quality standards established
pursuant to Section 39607 of the Health and Safety Code.
(d) Each net energy metering contract or tariff shall be
identical, with respect to rate structure, all retail rate
components, and any monthly charges, to the contract or tariff to
which the customer would be assigned if the customer was not an
eligible fuel cell customer-generator. Any new or additional demand
charge, standby charge, customer charge, minimum monthly charge,
interconnection charge, or other charge that would increase an
eligible fuel cell customer-generator's costs beyond those of other
customers in the rate class to which the eligible fuel cell
customer-generator would otherwise be assigned are contrary to the
intent of the Legislature in enacting the act adding this section,
and may not form a part of net energy metering tariffs.
(e) The net metering calculation shall be carried out in
accordance with Section 2827.9.
(f) A fuel cell electrical generating facility shall not be
eligible for participation in the tariff established pursuant to this
section unless it commenced operation before January 1, 2014. A fuel
cell customer-generator shall be eligible for the tariff established
pursuant to this section only for the operating life of the eligible
fuel cell electrical generating facility.
SEC. 5. Section 2852 of the Public Utilities Code is amended to
read:
2852. (a) As used in this section, the following terms have the
following meanings:
(1) "Affordable housing cost," "affordable rent," and "lower
income households" have the same meanings as in those set forth in
Chapter 2 (commencing with Section 50050) of Part 1 of Division 31 of
the Health and Safety Code.
(2) "California Solar Initiative" means the program providing
ratepayer funded incentives for eligible solar energy systems adopted
by the Public Utilities Commission in Decision 05-12-044 and
Decision 06-01-024.
(3) "Low-income residential housing" means any of the following:
(A) A multifamily residential complex financed with low-income
housing tax credits, tax-exempt mortgage revenue bonds, general
obligation bonds, or local, state, or federal loans or grants, and
for which either of the following applies:
(i) The rents of the occupants who are lower income households do
not exceed those prescribed by deed restrictions or regulatory
agreements pursuant to the terms of the financing or financial
assistance.
(ii) The affordable units have been or will be initially sold at
an affordable housing cost to a lower income household and those
units are subject to a resale restriction or equity sharing agreement
pursuant to the terms of the financing or financial assistance.
(B) A multifamily residential complex in which at least 20 percent
of the total housing units are sold or rented to lower income
households and either of the following applies:
(i) The rental housing units targeted for lower income households
are subject to a deed restriction or affordability covenant with a
public entity or nonprofit housing provider organized under Section
501(c)(3) of the Internal Revenue Code that has as its stated purpose
in its articles of incorporation on file with the office of the
Secretary of State to provide affordable housing to lower income
households that ensures that the units will be available at an
affordable rent for a period of at least 30 years.
(ii) The housing units have been or will be initially sold at an
affordable cost to a lower income household and those units are
subject to a resale restriction or equity sharing agreement, for
which the homeowner does not receive a greater share of equity than
described in paragraph (2) of subdivision (c) of Section 65915 of the
Government Code, with a public entity or nonprofit housing provider
organized under Section 501(c)(3) of the Internal Revenue Code that
has as its stated purpose in its articles of incorporation on file
with the office of the Secretary of State to provide affordable
housing to lower income households.
(C) An individual residence sold at an affordable housing cost to
a lower income household that is subject to a resale restriction or
equity sharing agreement, for which the homeowner does not receive a
greater share of equity than described in paragraph (2) of
subdivision (c) of Section 65915 of the Government Code, with a
public entity or nonprofit housing provider organized under Section
501(c)(3) of the Internal Revenue Code that has as its stated purpose
in its articles of incorporation on file with the office of the
Secretary of State to provide affordable housing to lower income
households.
(4) "Solar energy system" means a solar energy device that has the
primary purpose of providing for the collection and distribution of
solar energy for the generation of electricity, that produces at
least one kilowatt, and produces not more than five megawatts,
alternating current rated peak electricity, and that meets or exceeds
the eligibility criteria established by the commission or the State
Energy Resources Conservation and Development Commission.
(b) In establishing the California Solar Initiative, no moneys
shall be diverted from any existing programs for low-income
ratepayers, or from cost-effective energy efficiency or demand
response programs.
(c) (1) The commission shall ensure that not less than 10 percent
of the funds for the California Solar Initiative are utilized for the
installation of solar energy systems on low-income residential
housing. Notwithstanding any other law, the commission may modify the
monetary incentives made available pursuant to the California Solar
Initiative to accommodate the limited financial resources of
low-income residential housing.
(2) The commission may incorporate a revolving loan or loan
guarantee program into the California Solar Initiative for low-income
residential housing. All loans outstanding as of January 1, 2016,
shall continue to be repaid consistent with the terms and conditions
of the program adopted and implemented by the commission pursuant to
this subdivision, until repaid in full.
(3) All moneys set aside for the purpose of funding the
installation of solar energy systems on low-income residential
housing that are unexpended and unencumbered on January 1, 2016, and
all moneys thereafter repaid pursuant to paragraph (2), except to the
extent those moneys are encumbered pursuant to this section, shall
be utilized to augment existing cost-effective energy efficiency
measures in low-income residential housing that benefit ratepayers.
SEC. 6. This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
In order to expand the efficient use of alternative sources of
energy to reduce the use of fossil and nuclear fuels as soon as
possible, it is necessary for this act to go into effect immediately.
