BILL ANALYSIS
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|SENATE RULES COMMITTEE | AB 58|
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CONFERENCE COMPLETED
Bill No: AB 58
Author: Keeley (D), et al
Amended: Conference Report #1, 8/27/02
Vote: 21
SENATE ENERGY, U.&C. COMMITTEE : 8-0, 6/25/02
AYES: Bowen, Morrow, Alarcon, Battin, Dunn, Murray, Sher,
Vasconcellos
SENATE FLOOR : 34-2, 8/14/02
AYES: Ackerman, Alarcon, Alpert, Battin, Brulte, Burton,
Chesbro, Costa, Dunn, Escutia, Figueroa, Haynes,
Johannessen, Karnette, Knight, Kuehl, Machado, Margett,
McPherson, Monteith, Murray, O'Connell, Oller, Ortiz,
Perata, Polanco, Poochigian, Romero, Scott, Sher, Soto,
Speier, Torlakson, Vasconcellos
NOES: Bowen, McClintock
ASSEMBLY FLOOR : 69-0, 1/22/02 - See last page for vote
SUBJECT : Net energy metering
SOURCE : Author
DIGEST : This bill makes a number of substantive changes
to existing net metering rules.
ANALYSIS : Current law requires all energy service
providers, which include investor-owned electric utilities
(IOUs), municipal utilities, or any other entity offering
retail electric service, to credit all electricity
CONTINUED
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generated by a customer-owned solar or wind system against
the customer's usage of electricity sold by the utility, a
procedure known as "net metering".
Current law allows net metering customers to employ solar
or wind electric generation systems as large as 1 megawatt
(Mw). This size limitation is reduced to 10 kilowatts (kw)
as of January 1, 2003.
Current law doesn't limit the overall amount of net metered
capacity in any energy service provider's service area. As
of January 1, 2003, the overall amount of net metered
capacity is limited to one-tenth of one percent of the peak
electrical demand for each utility.
This bill:
1. Allows net metering for customers of investor-owned
utilities using solar energy systems of up to 1000 kw.
2. Allows net metering for customers of investor-owned
utilities using wind energy systems of up to 50 kw.
3. Net metering customers must reimburse the State
Department of Water Resources for charges that would
otherwise be imposed on the customer to recover
bond-related charges as well as long-term contract
costs, as determined by the commission.
4. Allows co-metering for customers of investor-owned
utilities using wind energy systems of between 50 kw
and 1000 kw. Co-metering credits customers for the
electricity they generate at time-of-use rates and at
the generation rate the utility charges its customers.
5. Net metering and co-metering customers must pay public
goods charges.
6. Limits total net metering in the service area of
investor-owned utilities to one-half of one percent of
peak load.
7. Allow municipal utilities to permit net metering or
co-metering, and exempts the Los Angeles Department of
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Water and Power from any net metering or co-metering
requirements.
8. Prohibits cost shifting resulting from net metering
between customer classes.
9. Allows the Energy Commission to establish a separate,
higher solar energy system rebate level for solar
energy systems installed on affordable housing
projects.
Background
In 1995, the Legislature passed SB 656 (Alquist), Chapter
369, Statutes of 1995, which required all electric
utilities to buy back any electricity generated by a
customer-owned solar and wind systems system. This
buy-back program is known as "net metering" because the
electricity purchases of the customer are netted against
the electricity generated by the customer's solar electric
system. The generated electricity spins the meter
backward, making it equivalent to the customer using less
electricity. Thirty-five states have net metering programs
today with the maximum size of the net metered system
limited to 100 kw.
Net metering was initially permitted for systems up to 10
kw making it suitable for residential-sized applications.
(A typical residential net-metered system is 2 kw - 4 kw).
The total amount of capacity that could be net metered was
capped at 0.1 percent of the utility load. In 2001, the
Legislature passed AB 29X (Kehoe), Chapter 8, Statutes of
the First Extraordinary Session of 2001, which expanded the
net metering program to large commercial and industrial
customers by raising the maximum size of the net-metered
system to 1 Mw and lifting the cap on total net metered
capacity. Because of concerns over the effect of these
changes, the provisions of AB 29X relating to net metering
were sunsetted on January 1, 2003.
There are about 2,200 net-metered customers today, with
pending applications for an additional 700. Total
net-metered capacity is about 6 Mw, with an additional 3 Mw
pending. Including the pending projects, total net-metered
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capacity in California is only about 0.02 percent of
utility peak load.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No
Local: No
SUPPORT : (Verified 8/6/02 - Unable to reverify at time
of writing)
Abel Greenhouse Company
Brummitt Energy Associates Inc.
CAL-AIR, Inc.
California Construction Authority
California Solar Energy Industries Association
City of Arcata
City of Santa Rosa
Clean Power Campaign
Coalition of California Utility Employees
Dale Enterprises
Enertron Consultants
Harmony Farm Supply & Nursery
International Brotherhood of Electrical
Workers, Local 332
Marin County Community Development
Agency
National Solar Power
Offline Independent Energy Systems
Office of Ratepayer Advocates
PFG Energy Capital
Powerlight Solar Electric Systems
Real Goods Design & Consulting Group
Schott Applied Power
Shell Solar Industries
Short Electric
Sierra Club
Solar Depot
Solar Technologies
UNI-SOLAR
Verve Enterprises
15 Individuals
ASSEMBLY FLOOR
AYES: Aanestad, Alquist, Aroner, Ashburn, Bogh, Briggs,
Calderon, Bill Campbell, Canciamilla, Cardenas, Cardoza,
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Cedillo, Chan, Chavez, Chu, Cogdill, Corbett, Correa,
Cox, Daucher, Diaz, Dickerson, Dutra, Firebaugh, Florez,
Frommer, Goldberg, Havice, Hollingsworth, Jackson,
Keeley, Kehoe, Kelley, Koretz, La Suer, Leach, Leonard,
Liu, Longville, Lowenthal, Maddox, Maldonado, Matthews,
Migden, Nakano, Negrete McLeod, Oropeza, Robert Pacheco,
Rod Pacheco, Pavley, Pescetti, Reyes, Runner, Salinas,
Shelley, Simitian, Steinberg, Strickland, Strom-Martin,
Thomson, Vargas, Washington, Wayne, Wiggins, Wright,
Wyland, Wyman, Zettel, Hertzberg
NC:kb 8/29/02 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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