BILL NUMBER: SB 1269 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY AUGUST 1, 2002
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 are final 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. If that
30-day deadline is not met, the bill would require the commission to
establish construction milestones for the project. 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 require the commission
to extend the start of construction by 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 demonstrates to the commission that it
it is willing and able to construct the project, the bill
would require authorize the commission
to promptly 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. The
bill would require the commission, if it issues a new certification,
to adopt new deadlines and milestones for the project that
allow the authority up to 24 months to start construction or to
start to meet the applicable deadlines and milestones.
The bill would specify that those provisions do not apply to
specified qualifying small power production facilities or qualifying
cogeneration facilities, as provided, 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 , in consultation with each other, to
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, signing long-term contracts for the
electricity production of planned facilities, and offering incentives
for rapid powerplant construction.
(c) However, because it is critical for the welfare of the state
and its citizens that entities that obtain certification to construct
new 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
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 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 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).
(4) The owner of a project does not start construction of the
project within 12 months after the date all permits necessary for the
project become final and all administrative and judicial appeals
have been resolved provided the California Consumer Power and
Conservation Financing Power Authority notifies the commission that
it is willing and able to construct the project pursuant to
subdivision (g). The project owner may extend the 12-month period by
24 additional months pursuant to subdivision (f). This paragraph
applies only to projects with a project permit application deemed
complete by the commission on or after January 1, 2003.
(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
subject to the start of construction deadline provided by paragraph
(4) of subdivision (a) 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. The commission shall approve milestones
within 60 days after project certification. 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 owner
of a project subject to the start of construction deadline provided
by paragraph (4) of subdivision (a) 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 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.
(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. Any
reimbursement received by the commission pursuant to this subdivision
shall be deposited in the General Fund.
(g) If the project owner owner of a
project subject to the start of construction deadline provided by
paragraph (4) of subdivision (a) 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 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 a project subject to the start of construction
deadline provided by paragraph (4) of subdivision (a) to the
authority, the commission shall adopt new milestones for the project
that allow the authority up to 24 months to start construction of the
project or to start to meet the applicable deadlines or
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 a project subject to the start of
construction deadline provided by paragraph (4) of subdivision (a)
to the authority and the authority pursues the project, without
participation of the original certificate holder, the authority
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 a
certificate holder from selling its license to construct and
operate the a 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 deadlines or 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
deadlines or 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 , in consultation with each other, 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.