BILL ANALYSIS
Appropriations Committee Fiscal Summary
29 (Kehoe)
Hearing Date: 4/04/01 Amended: 4/3/01
Consultant: Lisa Matocq Policy Vote: E, U & C
7-0
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BILL SUMMARY: AB 29x, an urgency bill, appropriates or
reappropriates $408 million from specified funds for energy
conservation, efficiency, and distributed generation
programs, as specified.
Fiscal Impact (in thousands)
Major Provisions 2001-02 2002-03
2003-04 Fund
Appropriation $408,650* Unknown costs in outyears
Various
Community colleges Potentially hundreds of millions,
offset by General
"green" buildings, etc. an unknown amount for energy cost
savings
*Appropriated in the bill. Some costs may count toward meeting
Prop. 98 minimum guarantee.
STAFF COMMENTS: This bill meets the criteria to be placed
on the Suspense File. This bill was heard by this
Committee on 4/3/01 and was put over in order to further
review author amendments. Those amendments are reflected
in the bill and the more substantive amendments are
reflected in this analysis. The author intends to propose
an additional amendment in committee to do the following:
narrow the scope of the Energy Management Program
provisions in Section 81622(b) of the bill to require
that 15 , rather than 150 energy systems be completed, and
3, rather than 20 , sustainable "green" buildings be
constructed, and make these provisions subject to
approval and appropriation in the annual budget act or
subject to receipt of local funding for this purpose.
In its current form, there are three funding sources for
the programs in this bill: General Fund, Prop. 98
Reversion Account, and Renewable Resources Trust Fund.
$368.5 million, General Fund, and $15 million, Renewable
Resources Trust Fund, is to be allocated as follows:
1. $234.5 million for California Energy Commission (CEC)
programs as follows:
$50 million to establish a grant/loan program for
low-income persons and small businesses to
construct/retrofit buildings to be more energy efficient;
$50 million for electric metering programs, $35 million
of which is for time-of-use or real time meters for 200
kw+ customers, and $15 million of which is for the Public
Utilities Commission (PUC) to conduct a pilot program of
real time metering for nonresidential customers. Each
meter costs an estimated $2500. STAFF NOTES that the
costs of meters are currently passed on to users;
$50 million for the Small Business Energy Efficient
Refrigeration Loan Program;
$50 million to the State Energy Conservation Assistance
Account to augment an existing program
to provide loans and grants to local governments for
energy efficiency and conservation programs;
$15 million, General Fund , and $15 million from the
Renewable Resource Trust Fund , to augment the Emerging
Renewable Resources Account to expand existing programs
to promote distributed emerging technologies, as
specified. Of the $30 million, $22 million is to be used
for rebates for systems under 10 kw in IOUs service
areas, and $8 million is for rebates for small systems in
local publicly owned utilities service areas;
$4.5 million to complete the Southeast Geysers power
plant pipeline project, owned by Lake County, as
specified.
STAFF NOTES that the overall budget of the CEC is about
$200 million.
2. $40 million for the Renewable Energy Loan Loss Reserve
Fund, hereby created, to guarantee loans for renewable
energy projects, as specified, to be administered by the
Trade and Commerce Agency. Costs in outyears depend on the
program participation;
3. $40 million to the California Conservation Corps (CCC)
to purchase, distribute, and install subcompact fluorescent
lights and other energy-saving devices, and water-saving
devices in homes and businesses, as part of the Mobile
Efficiency Brigade. The brigade is established, until
January 1, 2003, to expand the Department of Community
Services and Development (DCSD) and CCC conservation
programs, working with community based organizations. The
bill requires the CCC and DCSD to expand their
weatherization, energy-efficiency, and rehabilitation
programs. Costs in outyears are unknown;
4. $20 million to the DCSD for the program described in 3
above;
5. $25 million to the California Alternative Energy and
Advanced Transportation Financing Authority to provide
financial assistance to public power entities, independent
generators, and others for new and renewable energy
sources, and to develop clean distributed generation. The
bill also changes the existing program by expanding
eligibility;
6. $24 million to the Department of Corrections to
install systems to retrofit
generation units to improve environmental performance.
$25.15 million is reappropriated from Prop. 98 Reversion
Account as follows:
$25 million to community college districts to implement
energy projects,
$150,000 as a grant to the Community College League of
California to establish a statewide database of community
college district utility usage for conservation planning.
This is intended to be a one-time appropriation.
In addition, the bill requires the Board of Governors (BOG)
of the California Community Colleges to further develop
guidelines for a State Energy Management Program to
facilitate the completion of, by 2010, 20 district energy
management plans, 150 renewable or other distributed energy
systems, and 20 sustainable green buildings on campuses, as
specified. STAFF NOTES that although no funding is
provided for this purpose, Legislative Counsel has
identified this as a reimbursable mandate. Increased costs
are probably in the hundreds of millions (the green
buildings alone could cost $320 million: 20 buildings @ $16
million each) offset by an unknown amount for energy cost
savings. To the extent that these buildings can be
constructed in lieu of other planned projects, costs are
reduced. It is unknown whether bond funds could be used
for some of the above purposes. See comments on proposed
author amendments.
The bill also (1) requires the Department of General
Services (DGS) to identify and retrofit state buildings to
reduce energy consumption or produce its own electrical
generation. DGS staff indicate that this provision
codifies current practice, therefore, any increased costs
are minor, absorbable, (2) until December 31, 2002, makes
changes to net metering provisions of existing law, and (3)
contains numerous public contracting provisions exemptions
e.g. competitive bidding, until a specified date.
To the extent that the conservation measures are effective
in reducing demand, there could be energy cost savings by
summer 2001.
SB 5x (Sher), pending in the Assembly, contains numerous
energy conservation measures.