BILL NUMBER: SB 1269 AMENDED
BILL TEXT
AMENDED IN SENATE MAY 24, 2002
AMENDED IN SENATE MAY 9, 2002
INTRODUCED BY Senator Peace
JANUARY 15, 2002
An act to amend Section 25534 of the Public Resources Code,
relating to energy resources.
LEGISLATIVE COUNSEL'S DIGEST
SB 1269, as amended, Peace. Powerplant site and facility
certification.
The existing Warren-Alquist State Energy Resources Conservation
and Development Act requires the State Energy Resources Conservation
and Development Commission to certify sufficient sites and related
facilities that are required to provide a supply of electric power
sufficient to accommodate projected demand for power statewide.
Existing law authorizes the commission, after hearings, to amend the
conditions of, or revoke the certification for, any facility for
specified reasons and to administratively impose a civil penalty for
specified violations of a certification of up to $50,000 per
violation, as prescribed.
Existing law establishes in state government the California
Consumer Power and Conservation Financing Authority, with powers and
responsibilities as prescribed, including the power to issue revenue
bonds for the purpose of augmenting electric generating facilities
and to ensure a sufficient and reliable supply of electricity,
financing incentives for investment in cost-effective ,
energy-efficient appliances and energy demand reduction, achieving a
specified energy capacity reserve level, providing financing for the
retrofit of inefficient electric powerplants, renewable energy and
conservation, and, where appropriate, developing strategies for the
authority to facilitate a dependable supply of natural gas at
reasonable prices to the public.
This bill would authorize the commission to administratively
impose a civil penalty for specified violations of up to $75,000, as
prescribed.
This bill would require a project owner to commence construction
of a project within 12 months after the project has been certified by
the commission. The bill would require a project owner to submit
construction and commercial operation milestones within 30 days after
project certification. The bill would specify that the failure of
the project owner to meet construction or commercial operation
milestones, without a finding of good cause, is cause for revocation
of certification or the imposition of other penalties. The bill
would authorize the commission to extend the start of construction by
12 months under certain circumstances.
This bill would require the commission to revoke the certification
and provide immediate notice of its decision to the authority if the
project owner fails to commence construction, without good cause,
within 12 months after the project has been certified and the owner
has not received an extension. The bill would require the authority
to evaluate whether to pursue the project independently or in
conjunction with any other public or private entity, including the
original certificate holder. If the authority informs the commission
that it will construct the project, the bill would require the
commission to promptly issue a new certification for the project to
the authority, unless the authority's statutory authorization to
finance or approve new programs, enterprises, or projects has
expired. The bill would require the commission, if it issues a new
certification, to adopt new milestones for the project that allow the
authority up to 12 months to start construction or to start to meet
the applicable milestones. The bill would specify that those
provisions do not apply to specified qualifying small power
production facilities or qualifying cogeneration facilities, as
provided, or any other generation units installed, operated, and
maintained at a customer site exclusively to serve that facility's
load.
The bill would authorize the commission and authority to jointly
adopt emergency regulations for the purposes of the bill.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares all of the
following:
(a) Reliable, reasonably priced electricity service is essential
for California's economic growth and for the health and welfare of
its citizens.
(b) The Legislature, through Assembly Bill 970 of the 1999-2000
Regular Session and Senate Bill 28 of the 2001-02 First Extraordinary
Session, and the Governor, through Executive orders issued pursuant
to his emergency powers, have acted to expedite the construction of
in-state electric generation facilities by accelerating the State
Energy Resources Conservation and Development Commission's powerplant
certification process, signed long-term contracts for the
electricity production of planned facilities, and provided incentives
for rapid powerplant construction.
(c) However, since it is critical for the welfare of the state and
its citizens that entities that obtain certification to construct
new powerplants and to expand or repower existing powerplants do so
with all due speed, it is the policy of the state to condition the
issuance of powerplant certification to require prompt, continuous,
good faith efforts to construct the certified project within its
original construction schedule.
(d) It is further the policy of the state that, in the event a
certification certificate holder fails
to demonstrate prompt, continuous, good faith efforts to construct
new powerplants, the commission may revoke the certification of the
original project owner and issue a new certification to the
California Consumer Power and Conservation Financing Authority to
construct the project if the authority timely informs the commission
that it will construct the project either independently or in
conjunction with any other public or private entity, including the
original licensee.
SEC. 2. Section 25534 of the Public Resources Code is amended to
read:
25534. (a) The commission may, after one or more hearings, amend
the conditions of, or revoke the certification for, any facility for
any of the following reasons:
(1) Any material false statement set forth in the application,
presented in proceedings of the commission, or included in
supplemental documentation provided by the applicant.
(2) Any significant failure to comply with the terms or conditions
of approval of the application, as specified by the commission in
its written decision.
(3) A violation of this division or any regulation or order issued
by the commission under this division.
(4) For permits issued after January 1, 2003, the project owner
does not start construction of the project within 12 months of the
date of certification, without good cause, and does not receive
subsequent approval from the commission to extend the start of
construction of the project under subdivision (f).
(b) The commission may also administratively impose a civil
penalty for a violation of paragraph (1) or (2) of subdivision (a).
Any civil penalty shall be imposed in accordance with Section 25534.1
and may not exceed seventy-five thousand dollars ($75,000) per
violation, except that the civil penalty may be increased by an
amount not to exceed one thousand five hundred dollars ($1,500) per
day for each day in which the violation occurs or persists, but the
total of the per day penalties may not exceed fifty thousand dollars
($50,000).
(c) A project owner shall commence construction of a project
within 12 months after the project has been certified by the
commission. The project owner shall submit construction and
commercial operation milestones to the commission within 30 days
after project certification. Construction milestones shall require
the start of construction within the 12-month period established by
this subdivision. If the 30-day deadline to submit construction
milestones to the commission is not met, the commission shall
establish milestones for the project.
(d) The failure of the project owner to meet construction or
commercial operation milestones, without a finding by the commission
of good cause, shall be cause for revocation of certification or the
imposition of other penalties by the commission.
(e) A finding by the commission that there is good cause for
failure to meet milestones shall be made if the commission determines
that any of the following criteria are met:
(1) The change in any milestone does not change the established
milestone for the start of commercial operation.
(2) The milestone is changed due to circumstances beyond the
project owner's control, including, but not limited to,
administrative and legal appeals.
(3) The milestone will be missed but the project owner
demonstrates a good faith effort to meet the project milestone.
(4) The milestone will be missed due to unforeseen natural
disasters or acts of God that prevent timely completion of the
project milestone.
(f) In the absence of good cause, the commission may extend the
start of construction by 12 months if the owner reimburses the
commission for the commission's actual cost of licensing the project.
For the purposes of this section, the commission's actual cost of
licensing the project shall be based on a certified audit report
filed by the commission staff within 180 days of the commission's
certification of the project. The certified audit shall be filed and
served on all parties to the proceeding, is subject to public review
and comment, and is subject to at least one public hearing if
requested by the project owner.
(g) If the project owner fails to commence construction, without
good cause, within 12 months after the project has been certified by
the commission and has not received an extension pursuant to
subdivision (f), the commission shall provide immediate notice to the
California Consumer Power and Conservation Financing Authority. The
authority shall evaluate whether to pursue the project independently
or in conjunction with any other public or private entity, including
the original certificate holder. If the authority informs the
commission that it will construct the project either independently or
in conjunction with any other public or private entity, including
the original certificate holder, the commission may revoke the
original certification and issue a new certification for the project
to the authority, unless the authority's statutory authorization to
finance or approve new programs, enterprises, or projects has
expired.
(h) If the commission issues a new certification for the project
to the authority, the commission shall adopt new milestones for the
project that allow the authority up to 12 months to start
construction of the project or to start to meet the applicable
milestones.
(i) (1) If the commission issues a new certification for the
project to the authority and the authority pursues the project,
without participation of the original certificate holder, the
authority will reimburse the original certificate holder for the
actual costs the original certificate holder incurred in permitting
the project and in procuring assets associated with the license,
including, but not limited to, major equipment and the emission
offsets. In order to receive reimbursement, the original certificate
holder shall provide to the commission documentation of the actual
costs incurred in permitting the project. The commission shall
validate those costs.
(2) If the authority reimburses the original certificate holder
for the costs described in paragraph (1), the original certificate
holder shall provide the authority with the all assets for
which it holder shall provide the authority with all
of the assets for which the original certificate holder
received reimbursement.
(j) This section does not prevent the certificate holder from
selling its license to construct and operate the project prior to its
revocation by the commission. In the event of a sale to an
entity that is not an affiliate of the certificate holder , the
commission shall adopt new milestones for the project that allow the
new certificate holder up to 12 months to start construction of the
project or to start to meet the applicable milestones.
(k) Paragraph (4) of subdivision (a) and subdivisions (c) to (j),
inclusive, do not apply to licenses issued for the modernization,
repowering, replacement, or refurbishment of existing facilities or
to a qualifying small power production facility or a qualifying
cogeneration facility within the meaning of Section
Sections 201 and 210 of Title II of the federal
Public Utility Regulatory Policies Act of 1978 (16 U.S.C. Secs. 796
(17), 796(18), and 824a-3), and the regulations adopted pursuant to
those sections by the Federal Energy Regulatory Commission (18 C.F.R.
Part Parts 292.101 to 292.602,
inclusive), nor shall those provisions apply to any other generation
units installed, operated, and maintained at a customer site
exclusively to serve that facility's load. For the purposes of this
subdivision, "replacement" of an existing facility includes, but is
not limited to, a comparable project at a location
different than the facility being replaced, provided that
the new project results in the being replaced,
provided that the commission certifies that the new project will
result in the decommissioning of the existing facility.
(l) To implement this section, the commission and the California
Consumer Power and Conservation Financing Authority may jointly adopt
emergency regulations in accordance with Chapter 3.5 (commencing
with Section 11340) of Part 1 of Division 3 of Title 2 of the
Government Code. For purposes of that chapter, including, without
limitation, Section 11349.6 of the Government Code, the adoption of
the regulations shall be considered by the Office of Administrative
Law to be necessary for the immediate preservation of the public
peace, health and safety, or general welfare.