BILL NUMBER: SB 1269 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY AUGUST 8, 2002
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 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 provide immediate notice
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 is willing
and able to construct the project, the bill would authorize the
commission to 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, 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) 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 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 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 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 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 a certificate holder from
selling its license to construct and operate 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, 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.