June 2015 Legislative Update: Energy Procurement, Net Energy Metering, Electric Vehicle Chargers, and Green House Gas (GHG) regulation.

A. Direct Access (DA): SB 286

SB 286 would require a 2nd phase-in period to expand individual retail nonresidential end-use customers direct transactions over a period not to exceed 3 years, raising the allowable limit of kilowatthours that can be supplied by other providers in each electrical corporation’s distribution service territory by that electrical corporation’s share of an aggregate of 8,000 gigawatthours. The bill would require that all associated retail sales be procured from eligible renewable energy resources with enforcement under the California Renewables Portfolio Standard Program. Electrical corporation would continue to provide direct access customers with support functions through its own employees, subject to certain exceptions. Finally, the bill would prohibit an electric service provider from offering consolidated billing beginning January 1, 2016.

B. Net Energy Metering (NEM): SB 550

Existing law provides that an electric utility that is not a large electrical corporation is not obligated to provide net energy metering when the combined total peak demand of all electricity used by eligible customer-generators in the service area exceeds 5% of the aggregate customer peak demand of the electric utility. Existing law exempts from the net energy metering requirements a local publicly owned electric utility that serves more than 750,000 customers and that also conveys water to its customers. SB 550 would delete the exemption for those local publicly owned electric utilities and define the “aggregate customer peak demand” for the purposes of calculating the net energy metering program limit for electric utilities that are not large electrical corporations. This bill would require those electric utilities to file with the Energy Commission and to make available to the public a quarterly report detailing their progress towards the program limit. The bill would require the Energy Commission to post on its Internet Web site data detailing the progress towards their program limit.

C. Streamlined Permitting Processes for Electric Vehicle Charging: AB 1236

The bill would require that a local jurisdiction adopt an ordinance, by September 30, 2016, that creates an expedited and streamlined permitting process for electric vehicle charging stations to implement consistent statewide standards to achieve the timely and cost-effective installation of electric vehicle charging stations. The bill uses similar language and requirements as AB 2188 that implemented streamlined solar permitting from last session.

D. Renewable Resource Procurement and GHG Emissions: AB 197

This bill would require the California Public Utilities Commission (CPUC), in adopting the RPS process that orders and selects least-cost and best-fit eligible renewable energy resources, to include consideration of any statewide greenhouse gas emissions limit established pursuant to the California Global Warming Solutions Act of 2006 and consideration of capacity and essential reliability services of the eligible renewable energy resource to ensure grid reliability. The bill further would require the commission to ensure that a retail seller of electricity consider the best-fit attributes of resources types that ensure a balanced resource mix to maintain the reliability of the electrical grid in soliciting and procuring eligible renewable energy resources. The bill would provide revisions to the authority of an electrical corporation to refrain from entering into new contracts or constructing facilities beyond the quantity that can be procured within the electrical corporation’s cost limitation. Finally, the bill would require an electrical corporation or local publicly owned electric utility, in adopting a procurement plan, to consider any statewide greenhouse gas emissions limit established pursuant to the California Global Warming Solutions Act of 2006 and consider capacity and essential reliability services to ensure grid reliability.

E. Clean Energy and Pollution Reduction Act of 2015: SB 350

RPS and Public Utility Procurement: This bill would:

  • Express the intent of the Legislature for the purposes of the RPS program that the amount of electricity generated per year from eligible renewable energy resources be increased to an amount equal to at least 50% by December 31, 2030;
  • Require the CPUC, by January 1, 2017, to establish the quantity of electricity products from eligible renewable energy resources be procured by each retail seller for specified compliance periods sufficient to ensure that the procurement of electricity products from eligible renewable energy resources achieves 50% of retail sales by December 31, 2030;
  • Require the governing boards of local publicly owned electric utilities to ensure that specified quantities of electricity products from eligible renewable energy resources to be procured for specified compliance periods to ensure that the procurement of electricity products from eligible renewable energy resources achieve 50% of retail sales by December 31, 2030; and
  • Exclude all facilities engaged in the combustion of municipal solid waste from being eligible renewable energy resources.

Renewable Procurement Plans and Enforcement: This bill would:

  • Require community choice aggregators and electric service providers to prepare and submit renewable energy procurement plans;
  • Revise other aspects of the RPS program, including, among other things, the enforcement provisions and would require penalties collected for noncompliance to be deposited in the Electric Program Investment Charge Fund; and
  • Require the CPUC to direct electrical corporations to include in their proposed procurement plans a strategy for procuring a diverse portfolio of resources that provide a reliable electricity supply.

Actions for Clean Air and Emissions Reductions: This bill would require the CPUC and the Energy Commission to take certain actions in furtherance of meeting the state’s clean energy and pollution reduction objectives.

Actions to Reduce Emissions from transport fuel: This bill would:

  • Require the State Air Resources Board to amend various standards related to emissions from motor vehicles to be in furtherance of achieving a reduction in petroleum use in motor vehicles by 50% by January 1, 2030; and
  • State that it is the policy of the state to exploit all practicable and cost-effective conservation and improvements in the efficiency of energy use and distribution, and to achieve energy security, diversity of supply sources, and competitiveness of transportation energy markets based on the least environmental and economic costs in furtherance of reducing petroleum use in the transportation sector by 50% by January 1, 2030.

Building Standards: This bill would require the Energy Commission, by January 1, 2017, and at least once every 3 years thereafter, to adopt an update to the program in furtherance of achieving a doubling of energy efficiency in buildings by January 1, 2030.

F. California Renewables Portfolio Standard: AB 645

This bill would express the intent of the Legislature for the purposes of the RPS program that the amount of electricity generated per year from eligible renewable energy resources be increased to an amount equal to at least 50% by December 31, 2030. The bill would direct the CPUC, by January 1, 2017, to establish the quantity of electricity products from eligible renewable energy resources to be procured by each retail seller for specified compliance periods sufficient to ensure that the procurement of electricity products from eligible renewable energy resources achieves 50% of retail sales by December 31, 2030, and in all subsequent years. Finally, the bill would require the governing boards of local publicly owned electric utilities to ensure that specified quantities of electricity products from eligible renewable energy resources to be procured for specified compliance periods to ensure that the procurement of electricity products from eligible renewable energy resources achieve 50% of retail sales by December 31, 2030, and in all subsequent years.

G. Unbundled Renewable Energy Credits: AB 1144

This bill would provide that unbundled renewable energy credits under the California Renewables Portfolio Standard Program may be used to meet the first category of the portfolio content requirements if (1) the credits are earned by electricity that is generated by an entity that, if it were a person or corporation, would be excluded from the definition of an electrical corporation by operation of the exclusions for a corporation or person employing landfill gas technology or digester gas technology, (2) the entity employing the landfill gas technology or digester gas technology has a first point of interconnection with a California balancing authority, a first point of interconnection with distribution facilities used to serve end users within a California balancing authority area, or are scheduled from the eligible renewable energy resource into a California balancing authority without substituting electricity from another source, and (3) where the electricity generated that earned the credit is used at a wastewater treatment facility that is owned by a public entity and first put into service on or after January 1, 2016.

H. California Global Warming Solutions Act of 2006 Emissions Limits: SB 32

This bill would require the California State Air Resources Board to approve statewide greenhouse gas emissions limits that are equivalent to 40% below the 1990 level to be achieved by 2030 and 80% below the 1990 level to be achieved by 2050, as specified. The bill would authorize the state board to adopt an interim greenhouse gas emissions level target to be achieved by 2040. The bill also would state the intent of the Legislature for the Legislature and appropriate agencies to adopt complementary policies that ensure the long-term emissions reductions advance specified criteria.

I. California Global Warming Solutions Act of 2006 Regulations: AB 1288

The California Global Warming Solutions Act of 2006 authorizes the Air Resources Board to include the use of market-based compliance mechanisms and to adopt a regulation that establishes a system of market-based declining annual aggregate emissions limits for sources or categories of sources that emit greenhouse gases, applicable from January 1, 2012, to December 31, 2020, inclusive, as specified. This bill would eliminate the program sunset date of December 31, 2020 that limits the applicability of a regulation that establishes a system of market-based declining annual aggregate emissions limits for sources or categories of sources that emit greenhouse gases from January 1, 2012, to December 31, 2020.

J. Climate Change Adaptation: SB 246

This bill would require the Natural Resources Agency, no later than January 1, 2019, to update the 2009 California Climate Adaptation Strategy, require the Governor’s Office of Planning and Research, no later than January 1, 2017, to update the Adaptation Planning Guide, and establish an advisory council to support those goals of the Office of Planning and Research.

K. General Plan Safety Element and Resiliency for Climate Adaption and Resiliency: SB 379

The Planning and Zoning Law requires the legislative body of a city or county to adopt a comprehensive, long-term general plan that includes various elements, including, among others, a safety element for the protection of the community from unreasonable risks associated with the effects of various geologic hazards, flooding, and wild land and urban fires. This bill would, upon the next revision of a local hazard mitigation plan on or after January 1, 2017, or, if the local jurisdiction has not adopted a local hazard mitigation plan beginning on or after January 1, 2022, require the safety element to be reviewed and updated as necessary to address climate adaptation and resiliency strategies applicable to that city or county. The bill would require the update to include a set of goals, policies, and objectives based on a vulnerability assessment, identifying the risks that climate change poses to the local jurisdiction and the geographic areas at risk from climate change impacts, and specified information from federal, state, regional, and local agencies.

L. Public Retirement System Divestiture of Thermal Coal Companies: SB 185

This bill would prohibit the boards of the Public Employees’ Retirement System and the State Teachers’ Retirement System from making new investments or renewing existing investments of public employee retirement funds in a thermal coal company, as defined. The boards would be required to liquidate investments in thermal coal companies on or before July 1, 2017 and, in making a determination to liquidate investments, constructively engage with thermal coal companies to establish whether the companies are transitioning their business models to adapt to clean energy generation. The bill would provide that it does not require a board to take any action unless the board determines in good faith that the action is consistent with the board’s fiduciary responsibilities established in the constitution. This bill would require, on or before January 1, 2018, these boards to file a report to the Legislature and the Governor, containing specified information, including a list of companies of which they have liquidated their investments. Finally, the bill would provide that board members and other officers and employees shall be held harmless and be eligible for indemnification in connection with actions taken pursuant to the bill’s requirements, as specified.

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About Joe Kaatz

Staff Attorney at the Energy Policy Initiatives Center, University of San Diego School of Law.
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