Bill Text: CA SB1122 | 2011-2012 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

---

Bill Title: Energy: renewable bioenergy projects.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Passed) 2012-09-27 - Chaptered by Secretary of State. Chapter 612, Statutes of 2012. [SB1122 Detail]

Download: California-2011-SB1122-Amended.html

---

BILL NUMBER: SB 1122	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  AUGUST 24, 2012
	AMENDED IN ASSEMBLY  JUNE 28, 2012
	AMENDED IN ASSEMBLY  JUNE 18, 2012
	AMENDED IN SENATE  MAY 29, 2012
	AMENDED IN SENATE  APRIL 16, 2012

INTRODUCED BY   Senator Rubio

                        FEBRUARY 17, 2012

   An act to amend Section 399.20 of  , and to add Section
399.24 to,  the Public Utilities Code, relating to energy.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1122, as amended, Rubio. Energy: renewable  biomass and
biogas   bioenergy  projects.
   Under existing law, the Public Utilities Commission has regulatory
authority over public utilities. Existing law requires every
electrical corporation to file with the commission a standard tariff
for electricity generated by an electric generation facility, as
defined, that qualifies for the tariff, is owned and operated by a
retail customer of the electrical corporation, and is located within
the service territory of, and developed to sell electricity to, the
electrical corporation. Existing law requires an electrical
corporation to make the tariff available to the owner or operator of
an electric generation facility within the service territory of the
electrical corporation, as specified, until the electrical
corporation meets its proportionate share of a statewide cap of 750
megawatts, as specified.
   This bill would require the commission, by June 1, 2013, to
 direct electrical corporations, as defined, to collectively
procure at least 250 megawatts of electrical generating capacity from
startup developers of biomass and biogas projects, as defined. The
bill would authorize the commission to increase the 750 megawatt
statewide cap in order to allocate 250 megawatts to startup
developers of biomass and biogas projects fueled by specified sources
of bioenergy. The bill would, among other things, require the
commission, in implementing the 250 megawatt procurement requirement,
to direct each electrical corporation to develop standard contract
terms and conditions, as specified, and to provide a streamlined
contracting process for that procurement requirement. The bill would
also require the commission, at least once a year, to solicit
electricity from startup developers of biomass or biogas projects
through a competitive solicitation process for specified project
application categories   direct the electrical
corporations to collectively procure at least 250 megawatts of
cumulative rated generating capacity from developers of bioenergy
projects that commence operation on or after June 1, 2013. The bill
would require the commission, for each electrical corporation, to
allocate shares of the additional 250 megawatts based on the ratio of
each electrical corporation's peak demand compared to the total
statewide peak demand. The bill would require the  
commission to allocate those 250 megawatts to electrical corporations
from specified categories of bioenergy project types, with specified
portions of that 250 megawatts to be allocated from each category.
The bill would require the commission to encourage gas and electrical
corporations to develop and offer programs and services to
facilitate development of in-state biogas for a broad range of
purposes. The bill would authorize the commission, in consultation
with specified state agencies, if it finds that the allocations of
those 250 megawatts are not appropriate, to reallocate those 250
megawatts among those categories  . 
   The bill would also require the commission to encourage gas and
electrical corporations to develop and offer, by December 31, 2013,
programs and services to facilitate the development of in-state
biogas and to facilitate the conditioning and upgrading of biogas in
order to enable biogas to be used for a broad range of purposes, as
specified. 
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

  SECTION 1.  Section 399.20 of the Public Utilities Code is amended
to read:
   399.20.  (a) It is the policy of this state and the intent of the
Legislature to encourage electrical generation from eligible
renewable energy resources.
   (b) As used in this section, "electric generation facility" means
an electric generation facility located within the service territory
of, and developed to sell electricity to, an electrical corporation
that meets all of the following criteria:
   (1) Has an effective capacity of not more than three megawatts.
   (2) Is interconnected and operates in parallel with the electrical
transmission and distribution grid.
   (3) Is strategically located and interconnected to the electrical
transmission and distribution grid in a manner that optimizes the
deliverability of electricity generated at the facility to load
centers.
   (4) Is an eligible renewable energy resource.
   (c) Every electrical corporation shall file with the commission a
standard tariff for electricity purchased from an electric generation
facility. The commission may modify or adjust the requirements of
this section for any electrical corporation with less than 100,000
service connections, as individual circumstances merit.
   (d) (1) The tariff shall provide for payment for every
kilowatthour of electricity purchased from an electric generation
facility for a period of 10, 15, or 20 years, as authorized by the
commission. The payment shall be the market price determined by the
commission pursuant to paragraph (2) and shall include all current
and anticipated environmental compliance costs, including, but not
limited to, mitigation of emissions of greenhouse gases and air
pollution offsets associated with the operation of new generating
facilities in the local air pollution control or air quality
management district where the electric generation facility is
located.
   (2) The commission shall establish a methodology to determine the
market price of electricity for terms corresponding to the length of
contracts with an electric generation facility, in consideration of
the following:
   (A) The long-term market price of electricity for fixed price
contracts, determined pursuant to an electrical corporation's general
procurement activities as authorized by the commission.
   (B) The long-term ownership, operating, and fixed-price fuel costs
associated with fixed-price electricity from new generating
facilities.
   (C) The value of different electricity products including
baseload, peaking, and as-available electricity.
   (3) The commission may adjust the payment rate to reflect the
value of every kilowatthour of electricity generated on a
time-of-delivery basis.
   (4) The commission shall ensure, with respect to rates and
charges, that ratepayers that do not receive service pursuant to the
tariff are indifferent to whether a ratepayer with an electric
generation facility receives service pursuant to the tariff.
   (e) An electrical corporation shall provide expedited
interconnection procedures to an electric generation facility located
on a distribution circuit that generates electricity at a time and
in a manner so as to offset the peak demand on the distribution
circuit, if the electrical corporation determines that the electric
generation facility will not adversely affect the distribution grid.
The commission shall consider and may establish a value for an
electric generation facility located on a distribution circuit that
generates electricity at a time and in a manner so as to offset the
peak demand on the distribution circuit.
   (f) (1) An electrical corporation shall make the tariff available
to the owner or operator of an electric generation facility within
the service territory of the electrical corporation, upon request, on
a first-come-first-served basis, until the electrical corporation
meets its proportionate share of a statewide cap of 750 megawatts
cumulative rated generation capacity served under this section and
Section 387.6. The proportionate share shall be calculated based on
the ratio of the electrical corporation's peak demand compared to the
total statewide peak demand.
   (2) By June 1, 2013, the commission shall  , in addition to
the 750 megawatts identified   in paragraph (1), 
direct the electrical corporations to collectively procure at least
250 megawatts of  electrical   cumulative rated
 generating capacity from  startup  developers
of  biomass and biogas   bioenergy 
projects  that commence operation on or after June 1, 2013 
. The commission  may increase the 750 megawatt statewide
cap identified in paragraph (1) in order to allocate 250 megawatts to
electric generation facilities fueled by the sources of bioenergy
specified in subparagraph (B). The proportionate share shall be
calculated   shall, for each electrical corporation,
allocate shares of the additional 250 megawatts  based on the
ratio of  the   each  electrical
corporation's peak demand compared to the total statewide peak
demand. In implementing this paragraph, the commission shall do all
of the following:
   (A) Allocate the 250 megawatts identified in this paragraph among
the electrical corporations  .   based on the
following categories:  
   (B) Direct each electrical corporation to, at least once a year,
solicit electricity from startup developers of biomass or biogas
projects through a competitive solicitation process for each of the
following project application categories:  
   (i) For dairy digester gas, 85 megawatts.  
   (ii) 
    (i   )  For biogas from wastewater treatment,
 50   municipal organic waste diversion, food
processing, and codigestion   , 110  megawatts.

   (iii) 
    (ii   )  For  dairy a   nd other
 agricultural  biomass and biogas, 50  
bioenergy, 90  megawatts. 
   (iv) 
    (iii)  For  biomass  bioenergy
 using byproducts of sustainable forest management,  30
  50  megawatts.  Allocations under this
category shall be determined based on the proportion of bioenergy
that sustainable forest management providers derive from sustainable
forest management in fire threat treatment areas, as designated by
the Department of Forestry and Fire Protection. 
   (v) For landfill gas and organic waste diversion, 35 megawatts.
 
   (C) 
    (B)  Direct the electrical corporations to develop
standard contract terms and conditions that reflect the operational
characteristics of the projects, and to provide a streamlined
contracting process. 
   (D) Select the offers that represent the least-cost, best-fit
resources for the electrical corporation.  
   (E) 
    (C)  Coordinate, to the maximum extent feasible, any
incentive or subsidy programs for  biogas and biomass with
the solicitation requirement in subparagraph (B)  
bioenergy with the agencies listed in subparagraph (A) of paragraph
(3)  in order to provide maximum benefits to ratepayers 
and to ensure that incentives are used to reduce contract prices
  and to ensure that incentives are used to reduce
contract prices  . 
   (F) Ensure that electrical corporations give priority to resources
that result in the most greenhouse gas reductions as part of their
contract. As part of the solicitation process, the commission shall
require the electrical corporations to evaluate the value of
greenhouse gas reductions.  
   (G)  
    Allocate a proportional share of costs to the electric service
provider and community choice aggregator customers through
nonbypassable charges.  
   (D) The commission shall encourage gas and electrical corporations
to develop and offer programs and services to facilitate development
of in-state biogas for a broad range of purposes.  
   (3) (A) The commission, in consultation with the State Energy
Resources Conservation and Development Commission, the State Air
Resources Board, the Department of Forestry and Fire Protection, the
Department of Food and Agriculture, and the Department of Resources
Recycling and Recovery, may review the allocations of the 250
additional megawatts identified in paragraph (2) to determine if
those allocations are appropriate.  
   (B) If the commission finds that the allocations of the 250
additional megawatts identified in paragraph (2) are not appropriate,
the commission may reallocate the 250 megawatts among the categories
established in subparagraph (A) of paragraph (2).  
   (4) For the purposes of this subdivision, "bioenergy" means biogas
and biomass. 
   (g) The electrical corporation may make the terms of the tariff
available to owners and operators of an electric generation facility
in the form of a standard contract subject to commission approval.
   (h) Every kilowatthour of electricity purchased from an electric
generation facility shall count toward meeting the electrical
corporation's renewables portfolio standard annual procurement
targets for purposes of paragraph (1) of subdivision (b) of Section
399.15.
   (i) The physical generating capacity of an electric generation
facility shall count toward the electrical corporation's resource
adequacy requirement for purposes of Section 380.
   (j) (1) The commission shall establish performance standards for
any electric generation facility that has a capacity greater than one
megawatt to ensure that those facilities are constructed, operated,
and maintained to generate the expected annual net production of
electricity and do not impact system reliability.
   (2) The commission may reduce the three megawatt capacity
limitation of paragraph (1) of subdivision (b) if the commission
finds that a reduced capacity limitation is necessary to maintain
system reliability within that electrical corporation's service
territory.
   (k) (1) Any owner or operator of an electric generation facility
that received ratepayer-funded incentives in accordance with Section
379.6 of this code, or with Section 25782 of the Public Resources
Code, and participated in a net metering program pursuant to Sections
2827, 2827.9, and 2827.10 of this code prior to January 1, 2010,
shall be eligible for a tariff or standard contract filed by an
electrical corporation pursuant to this section.
   (2) In establishing the tariffs or standard contracts pursuant to
this section, the commission shall consider ratepayer-funded
incentive payments previously received by the generation facility
pursuant to Section 379.6 of this code or Section 25782 of the Public
Resources Code. The commission shall require reimbursement of any
funds received from these incentive programs to an electric
generation facility, in order for that facility to be eligible for a
tariff or standard contract filed by an electrical corporation
pursuant to this section, unless the commission determines ratepayers
have received sufficient value from the incentives provided to the
facility based on how long the project has been in operation and the
amount of renewable electricity previously generated by the facility.

   (3) A customer that receives service under a tariff or contract
approved by the commission pursuant to this section is not eligible
to participate in any net metering program.
   (l) An owner or operator of an electric generation facility
electing to receive service under a tariff or contract approved by
the commission shall continue to receive service under the tariff or
contract until either of the following occurs:
   (1) The owner or operator of an electric generation facility no
longer meets the eligibility requirements for receiving service
pursuant to the tariff or contract.
   (2) The period of service established by the commission pursuant
to subdivision (d) is completed.
   (m) Within 10 days of receipt of a request for a tariff pursuant
to this section from an owner or operator of an electric generation
facility, the electrical corporation that receives the request shall
post a copy of the request on its Internet Web site. The information
posted on the Internet Web site shall include the name of the city in
which the facility is located, but information that is proprietary
and confidential, including, but not limited to, address information
beyond the name of the city in which the facility is located, shall
be redacted.
   (n) An electrical corporation may deny a tariff request pursuant
to this section if the electrical corporation makes any of the
following findings:
   (1) The electric generation facility does not meet the
requirements of this section.
   (2) The transmission or distribution grid that would serve as the
point of interconnection is inadequate.
   (3) The electric generation facility does not meet all applicable
state and local laws and building standards and utility
interconnection requirements.
   (4) The aggregate of all electric generating facilities on a
distribution circuit would adversely impact utility operation and
load restoration efforts of the distribution system.
   (o) Upon receiving a notice of denial from an electrical
corporation, the owner or operator of the electric generation
facility denied a tariff pursuant to this section shall have the
right to appeal that decision to the commission.
   (p) In order to ensure the safety and reliability of electric
generation facilities, the owner of an electric generation facility
receiving a tariff pursuant to this section shall provide an
inspection and maintenance report to the electrical corporation at
least once every other year. The inspection and maintenance report
shall be prepared at the owner's or operator's expense by a
California-licensed contractor who is not the owner or operator of
the electric generation facility. A California-licensed electrician
shall perform the inspection of the electrical portion of the
generation facility.
   (q) The contract between the electric generation facility
receiving the tariff and the electrical corporation shall contain
provisions that ensure that construction of the electric generating
facility complies with all applicable state and local laws and
building standards, and utility interconnection requirements.
   (r) (1) All construction and installation of facilities of the
electrical corporation, including at the point of the output meter or
at the transmission or distribution grid, shall be performed only by
that electrical corporation.
   (2) All interconnection facilities installed on the electrical
corporation's side of the transfer point for electricity between the
electrical corporation and the electrical conductors of the electric
generation facility shall be owned, operated, and maintained only by
the electrical corporation. The ownership, installation, operation,
reading, and testing of revenue metering equipment for electric
generating facilities shall only be performed by the electrical
corporation. 
  SEC. 2.    Section 399.24 is added to the Public
Utilities Code, to read:
   399.24.  The commission shall encourage gas and electrical
corporations to develop and offer, by December 31, 2013, programs and
services to facilitate the development of in-state biogas and to
facilitate the conditioning and upgrading of biogas in order to
enable biogas to be used for a broad range of purposes, including
injection into natural gas pipelines, use for onsite power
generation, and use at compressed natural gas filling stations for
alternative fuel vehicles.