Bill Text: CA SB663 | 2023-2024 | Regular Session | Amended
Bill Title: California Renewables Portfolio Standard Program: renewable hydrogen.
Spectrum: Partisan Bill (Democrat 2-0)
Status: (Failed) 2024-02-01 - Died on file pursuant to Joint Rule 56. [SB663 Detail]
Download: California-2023-SB663-Amended.html
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Amended
IN
Senate
May 18, 2023 |
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Amended
IN
Senate
April 27, 2023 |
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Amended
IN
Senate
March 20, 2023 |
CALIFORNIA LEGISLATURE—
2023–2024 REGULAR SESSION
Senate Bill
No. 663
| Introduced by Senator Archuleta (Coauthor: Senator Skinner) |
February 16, 2023 |
An act to amend Section 25741 of the Public Resources Code, and to amend Section 399.12.6 of the Public Utilities Code, relating to energy.
LEGISLATIVE COUNSEL'S DIGEST
SB 663, as amended, Archuleta.
California Renewables Portfolio Standard Program: renewable hydrogen.
Existing law establishes the California Renewables Portfolio Standard Program, which requires the Public Utilities Commission to implement annual procurement targets for the procurement of eligible renewable energy resources, which is defined as an electrical generating facility that meets the definition of “renewable electrical generation facility” subject to certain conditions, for all retail sellers, as defined, and requires local publicly owned electric utilities to adopt and implement a renewable energy resources procurement plan to achieve the targets and goals of the program.
This bill would include a facility that uses renewable hydrogen, as defined, meeting certain requirements, including a requirement that sellers and purchasers of renewable hydrogen comply with a system for tracking and verifying the use of renewable hydrogen, as a
renewable electrical generation facility for purposes of the California Renewables Portfolio Standard Program.
Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.
Because certain provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for a specified reason.
Digest Key
Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: YESBill Text
The people of the State of California do enact as follows:
SECTION 1.
Section 25741 of the Public Resources Code is amended to read:25741.
As used in this chapter, the following terms have the following meaning:(a) “Renewable electrical generation facility” means a facility that meets all of the following criteria:
(1) The facility uses biomass, solar thermal, photovoltaic, wind, geothermal, fuel cells using renewable fuels, small hydroelectric generation of 30 megawatts or less, digester gas, municipal solid waste conversion, landfill gas, ocean wave, ocean thermal, tidal current, or renewable hydrogen as defined in this section, and any additions or enhancements to the facility using that technology.
(2) The facility satisfies one of the following requirements:
(A) The facility is located in the state or near the border of the state with the first point of connection to the transmission network of a balancing authority area primarily located within the state. For purposes of this subparagraph, “balancing authority area” has the same meaning as defined in Section 399.12 of the Public Utilities Code.
(B) The facility has its first point of interconnection to the transmission network outside the state, within the Western Electricity Coordinating Council (WECC) service area, and satisfies all of the following requirements:
(i) It commences initial commercial operation after January 1, 2005.
(ii) It will not cause or contribute to any violation of a California environmental quality standard or requirement.
(iii) It participates in the accounting system to verify compliance with the renewables portfolio standard once established by the commission pursuant to subdivision (b) of Section 399.25 of the Public Utilities Code.
(C) The facility meets the requirements of clauses (ii) and (iii) in subparagraph (B), but does not meet the requirements of clause (i) of subparagraph (B) because it commenced initial operation before January 1, 2005, if the facility satisfies either of the following requirements:
(i) The electricity is from incremental generation resulting from expansion or repowering of the facility.
(ii) Electricity generated by the facility was procured by a retail seller or local publicly owned electric utility as of January 1, 2010.
(3) If the facility is outside the United States, it is developed and operated in a manner that is as protective of the environment as a similar facility located in the state.
(4) If eligibility of the facility is based on the use of landfill gas, digester gas, or another renewable fuel delivered to the facility through a common carrier pipeline, the transaction for the procurement of that fuel, including the source of the fuel and delivery method, satisfies the requirements of Section 399.12.6 of the Public Utilities Code and is verified pursuant to the accounting system established by the commission pursuant to Section 399.25 of the Public Utilities Code, or a comparable system, as determined by the commission.
(5) If the facility, including a facility that includes a linear generator or a turbine, uses renewable
hydrogen, all of the following apply:
(A) The use of renewable hydrogen shall result in a net decrease in emission of oxides of nitrogen or other air pollutants and greenhouse gases from the electrical sector and shall not result in resource shuffling.
sector.
(B) The procurement and use of renewable hydrogen shall align with best practices regarding hydrogen production, distribution, storage, and use, including minimizing leakage risk, that are available at the time a facility applies for certification as an eligible renewable energy resource.
(C) Any renewable energy certificates or other environmental attributes associated with the feedstock and energy used to produce the renewable hydrogen are not produced, or are retired and not claimed under any program, with the exception of the federal Renewable Fuel Standard Program, and the market-based compliance mechanism set forth in Article 5 (commencing with Section 95801) of Subchapter 10 of Chapter 1 of Division 3 of Title 17 of the California Code of Regulations.
(b) “Municipal solid waste conversion,” as used in subdivision (a), means a technology that uses a noncombustion thermal process to convert solid waste to a clean-burning fuel for the purpose of generating electricity, and that meets all of the following criteria:
(1) The technology does not use air or oxygen in the conversion process, except ambient air to maintain temperature control.
(2) The technology produces no discharges of air contaminants or emissions, including greenhouse gases as defined in Section 38505 of the Health and Safety Code.
(3) The technology produces no discharges to surface or groundwaters of the state.
(4) The technology produces no hazardous wastes.
(5) To the maximum extent feasible, the technology removes all recyclable materials and marketable green waste compostable materials from the solid waste stream before the conversion process and the owner or operator of the facility certifies that those materials will be recycled or composted.
(6) The facility at which the technology is used is in compliance with all applicable laws, regulations, and ordinances.
(7) The technology meets any other conditions established by the commission.
(8) The facility certifies that any local agency sending solid waste to the facility diverted at least 30 percent of all solid waste it collects through solid waste reduction, recycling, and composting. For purposes of this paragraph, “local agency” means any city, county, or special district, or subdivision thereof that
is authorized to provide solid waste handling services.
(c) “Renewable energy public goods charge” means that portion of the nonbypassable system benefits charge required to be collected to fund renewable energy pursuant to the Reliable Electric Service Investments Act (Article 15 (commencing with Section 399) of Chapter 2.3 of Part 1 of Division 1 of the Public Utilities Code).
(d) “Renewable hydrogen” means hydrogen derived that meets all of the following conditions:
(1) The hydrogen is derived or produced from water using eligible renewable energy resources, as defined in Section 399.12 of the Public Utilities Code, or and is derived or produced from those eligible
new and incremental renewable energy resources.
(2) The manufacture of the hydrogen does not result in resource shuffling.
(3) The manufacture of the hydrogen does not use unbundled renewable energy credits.
(e) “Retail seller” means a “retail seller” as defined in Section 399.12 of the Public Utilities Code.
SEC. 2.
Section 399.12.6 of the Public Utilities Code is amended to read:399.12.6.
(a) (1) Any procurement of biomethane delivered through a common carrier pipeline under a contract executed by a retail seller or local publicly owned electric utility and reported to the Energy Commission before March 29, 2012, and otherwise eligible under the rules in place as of the date of contract execution shall count toward the procurement requirements established in this article, under the rules in place at the time the contract was executed, including the Fourth Edition of the Energy Commission’s Renewables Portfolio Standard Eligibility Guidebook, provided that those rules shall apply only to sources that are producing biomethane and injecting it into a common carrier pipeline on or before April 1, 2014.(2) The eligibility
requirements of subdivision (b) shall apply beginning March 29, 2012, to any quantities of biomethane associated with any of the following:
(A) An extension of the term of the original contract.
(B) Any quantity of biomethane that exceeds the quantities of biomethane specified in the original contract.
(C) Any optional quantities of biomethane that can be exercised at the discretion of the buyer.
(D) Any change in the source or sources of biomethane identified in the original contract or the original application for certification submitted to the Energy Commission.
(E) Any quantity of biomethane from a source not producing and capturing biomethane and injecting it into a common carrier
pipeline on or before April 1, 2014.
(F) The conditions of this paragraph shall apply beginning March 29, 2012.
(b) For contracts initially executed on or after March 29, 2012, or for quantities of biomethane or renewable hydrogen associated with contract amendments executed on or after March 29, 2012, the use of biomethane or renewable hydrogen by a generating facility shall not qualify as an eligible renewable energy resource unless it satisfies all applicable requirements established by the Energy Commission and meets any of the following requirements:
(1) The biomethane or renewable hydrogen is used by an onsite generating facility.
(2) The biomethane or renewable hydrogen is used by an offsite generating facility and delivered to the generating
facility through a dedicated pipeline.
(3) The biomethane is delivered to a generating facility through a common carrier pipeline and meets all of the following requirements:
(A) The source of biomethane injects the biomethane into a common carrier pipeline that physically flows within California or toward the generating facility for which the biomethane was procured under the original contract.
(B) The source of biomethane did not inject biomethane into a common carrier pipeline before March 29, 2012, or the source commenced injection of sufficient incremental quantities of biomethane after March 29, 2012, to satisfy the contract requirements.
(C) The seller or purchaser of the biomethane demonstrates that the capture and injection of biomethane into a
common carrier pipeline directly results in at least one of the following environmental benefits to California:
(i) The reduction or avoidance of the emission of any criteria air pollutant in California.
(ii) The reduction or avoidance of pollutants that could have an adverse impact on waters of the state.
(iii) The alleviation of a local nuisance within California that is associated with the emission of odors.
(c) For all electricity products generated using biomethane or renewable hydrogen that are credited toward the renewables portfolio standard procurement obligations established pursuant to this article, sufficient renewable and environmental attributes of biomethane or renewable hydrogen production and capture shall be transferred to the retail
seller or local publicly owned electric utility that uses that biomethane or renewable hydrogen to ensure that there are zero net emissions associated with the production of electricity from the generating facility using the biomethane or renewable hydrogen. This subdivision shall be applied in a manner consistent with the definition of “green attributes” as specified by the commission in Decision 08-08-028, Decision on Definition and Attributes of Renewable Energy Credits for Compliance with the California Renewables Portfolio Standard (August 21, 2008), as may be modified by subsequent decision of the commission.
(d) All sellers and purchasers of biomethane or renewable hydrogen shall comply with a system for tracking and verifying the use of biomethane or renewable hydrogen, as established by the Energy Commission, that is equivalent to the system required by subdivision (c) of Section 399.25.
(e) For contracts initially executed on or after March 29, 2012, or for quantities of biomethane or renewable hydrogen associated with contract amendments executed after March 29, 2012, the use of biomethane or renewable hydrogen shall be assigned to the appropriate portfolio content category based on the application of the criteria in subdivision (b) of Section 399.16 to the procurement of electricity by the retail seller or local publicly owned electric utility from the generating facility consuming the biomethane or renewable hydrogen.
(f) A retail seller, local publicly owned electric utility, or an intermediary party to a biomethane procurement contract shall not make a marketing, regulatory, or retail claim that asserts that a biomethane procurement contract to which that entity was a party resulted, or will result, in greenhouse gas reductions related to the destruction of
methane if the capture and destruction is required by law. If the capture and destruction of the biomethane is not required by law, a retail seller, local publicly owned electric utility, or an intermediary party to a biomethane procurement contract shall not make a marketing, regulatory, or retail claim that asserts that a biomethane procurement contract to which that entity was a party resulted, or will result, in greenhouse gas reductions related to the destruction of methane, unless the environmental attributes associated with the capture and destruction of the biomethane pursuant to that contract are transferred to the retail seller or local publicly owned electric utility that purchased that biomethane and retired on behalf of the retail customers consuming the electricity associated with the use of that biomethane, or unless the biomethane procurement contract prohibits the source of biomethane from separately marketing the environmental attributes associated with the capture and destruction of the
biomethane sold pursuant to that contract. These attributes shall be retired and may not be resold.
(g) For the purposes of this section, the following definitions apply:
(1) “Biomethane” means landfill gas or digester gas, consistent with Section 25741 of the Public Resources Code.
(2) “Renewable hydrogen” has the same meaning as set forth in Section 25741 of the Public Resources Code.
(h) If any provision of this section or the application of any provision of this section is held invalid, biomethane delivered through a common carrier pipeline pursuant to a contract executed within 180 days of, or at any time subsequent to, the invalidation of that provision shall not qualify as an eligible renewable energy
resource.
