BILL NUMBER: SB 1269 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY JUNE 20, 2002
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 and all accompanying project permits have been
issued and administrative and judicial appeals have been completed
. 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 require the commission
to extend the start of construction by 12 24
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
project 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 demonstrates to the commission
that it will it is willing and able to
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 24 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 , or specified licenses issued to
local publicly owned electric utilities that make a specified
certification .
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 signing
long-term contracts for the electricity production of planned
facilities, and provided offering
incentives for rapid powerplant construction.
(c) However, since because 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
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
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
project if the authority demonstrates to the commission that is
willing and able to 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).
(4) For permit applications filed and deemed complete after
January 1, 2003, where the project owner, without good cause, does
not start construction of the project within 12 months of the date
when all permits necessary for the project have been issued and all
administrative and judicial appeals have been resolved, unless the
project owner receives subsequent approval from the commission to
extend the start of construction of the project under subdivision
(f), or the California Consumer Power and Conservation Financing
Power Authority informs the commission it will construct the project
pursuant to subdivision (g).
(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 and after all accompanying project permits are final
and administrative and judicial appeals have been completed .
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 the start of
construction deadline required by paragraph (4) of subdivision (a) or
any subsequent milestones of subdivision (c) shall be made if
the commission determines that any of the following criteria are met:
(1) The change in any deadline or milestone does not
change the established deadline or milestone for the start of
commercial operation.
(2) The deadline or milestone is changed due to
circumstances beyond the project owner's control, including, but not
limited to, administrative and legal appeals.
(3) The deadline or milestone will be missed but the
project owner demonstrates a good faith effort to meet the project
deadline or milestone.
(4) The deadline or milestone will be missed due to
unforeseen natural disasters or acts of God that prevent timely
completion of the project deadline or 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
(5) The deadline or milestone will be missed for any other reason
determined reasonable by the commission.
(f) The commission shall extend the start of the construction
deadline required by paragraph (4) of subdivision (a) by an
additional 24 months, if the owner reimburses 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 holder. If the authority
demonstrates to the commission that it is willing and able to
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. If the
authority declines to pursue the project, the permit shall remain
with the current project owner until it expires pursuant to the
regulations adopted by the commission.
(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 24
months to start construction of the project or to start to meet
the applicable milestones. If the authority fails to begin
construction in conformity with the deadlines or milestones adopted
by the commission, without good cause, the certification may be
revoked.
(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 shall offer to 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.
The certificate holder may refuse to accept the offer of
reimbursement for any asset associated with the license and retain
the asset. To the extent the certificate holder chooses to accept
the offer for an asset, it shall provide the authority with the
asset.
(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 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 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. 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 commission certifies that
the new project will result in the decommissioning of the existing
facility.
(l) Paragraph (4) of subdivision (a) and subdivisions (c) to
(j), inclusive, do not apply to licenses issued to "local publicly
owned electric utilities" as defined in subdivision (d) of Section
9604 of the Public Utilities Code whose governing bodies certify to
the commission that the project is needed to meet the projected
native load of the local publicly owned utility.
(m) 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.