BILL ANALYSIS
AB 1724
Page 1
ASSEMBLY THIRD READING
AB 1724 (Pavley)
As Amended May 31, 2001
Majority vote
NATURAL RESOURCES 9-2 UTILITIES AND COMMERCE
11-5
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|Ayes:|Wayne, Dickerson, Harman, |Ayes:|Wright, Calderon, |
| |Jackson, Keeley, | |Canciamilla, Cardenas, |
| |Lowenthal, Negrete | |Diaz, Jackson, Nation, |
| |McLeod, Migden, Pavley | |Papan, Reyes, Simitian, |
| | | |Wesson |
|-----+--------------------------+-----+--------------------------|
|Nays:|Hollingsworth, Wyman |Nays:|Pescetti, Bill Campbell, |
| | | |John Campbell, Kelley, |
| | | |Maddox |
| | | | |
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APPROPRIATIONS 14-7
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|Ayes:|Migden, Alquist, Aroner, | | |
| |Cedillo, Corbett, Correa, | | |
| |Goldberg, Papan, Pavley, | | |
| |Simitian, Thomson, | | |
| |Wesson, Wiggins, Wright | | |
| | | | |
|-----+--------------------------+-----+--------------------------|
|Nays:|Bates, Ashburn, Daucher, | | |
| |Maldonado, Robert | | |
| |Pacheco, Runner, Zettel | | |
| | | | |
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SUMMARY : Deletes the sunset on customer credits to public
entities for the purchase of renewable energy that is not under
contract with a utility and provides that only public entities
with contracts in force on January 1, 2001 are eligible for the
customer credit.
EXISTING LAW :
1)Generally requires State Energy Resources Conservation and
Development Commission (CEC) to perform duties relating to the
AB 1724
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conservation and development of energy resources under the
Warren-Alquist State Energy Resources Conservation and
Development Act (Public Resources Code section 25000 et seq.)
2)Provides customer credits to anyone who purchases renewable
energy not under contract with a utility.
3)Sunsets the customer credit to public entities on January 1,
2002.
FISCAL EFFECT : According to the Assembly Appropriations
committee The total amount to be collected for the next 10 years
through a utility surcharge, for the customer credit program and
for other energy programs, has been established in prior
legislation. By continuing to allow public entities eligible
for the credits, this bill could change the allocation of those
credits. This amount is unknown, but the current credit to the
City of Santa Monica exceeds $200,000 annually.
COMMENTS : According to the author's office, AB 1890 (Brulte),
Chapter 854, Statutes of 1996, provided $540 million from
ratepayers (including local governments) to encourage investment
and competition in a renewable energy market during the
transition years from 1998 to 2001. The funds were placed in
the Renewable Resource Trust to be administered by the CEC.
Last year, AB 995 (Wright), Chapter 1050, Statutes of 2000, and
SB 1194 (Sher), Chapter 1050, Statutes of 2000, among other
things, extended the collection of funds by the three investor
owned utilities for the Renewable Resource Trust for an
additional 10 years in five year blocks.
Among the various allocations of the funds are customer credits
for the purchase of renewable energy that is not under contract
with a utility. The customer's total credit is based on how
much electricity was consumed in a one-year period (up to 10
cents per kilowatt hour with a $1000 cap per electric meter) and
could be incorporated either into the electricity price paid to
the provider or itemized separately. Under existing law, that
credit is available through the CEC for both private and public
entities that wish to purchase renewable energy. However, AB
995 and SB 1194 sunset the eligibility of public entities for
the customer credit on January 1, 2002.
According to supporters of the bill, because public agencies
regularly pay for the customer credit, they deserve access to
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its benefits. In addition, they believe that the sunset on the
eligibility prejudices local governments' ability to receive the
incentive.
An example of a community using renewable energy is the City of
Santa Monica. The City of Santa Monica has committed to
purchasing 100% of its power for municipal purposes from
suppliers of renewable energy. Under the existing program at
the CEC, the city had received approximately $200,000 in
reduced-price rates per year to partially offset the higher
costs of renewable electricity.
Analysis Prepared by : Kyra Emanuels Ross / NAT. RES. / (916)
319-2092
FN: 0001368