BILL NUMBER: AB 594 CHAPTERED
BILL TEXT
CHAPTER 790
FILED WITH SECRETARY OF STATE SEPTEMBER 25, 2004
APPROVED BY GOVERNOR SEPTEMBER 24, 2004
PASSED THE ASSEMBLY AUGUST 19, 2004
PASSED THE SENATE AUGUST 10, 2004
AMENDED IN SENATE JULY 21, 2004
AMENDED IN SENATE JUNE 15, 2004
AMENDED IN SENATE MARCH 3, 2004
AMENDED IN ASSEMBLY MARCH 24, 2003
INTRODUCED BY Assembly Member Leno
FEBRUARY 18, 2003
An act to add Section 2828 to the Public Utilities Code, relating
to private energy producers.
LEGISLATIVE COUNSEL'S DIGEST
AB 594, Leno. Private energy producers: Hetch Hetchy Water and
Power solar generation.
Under existing law, the Public Utilities Commission is vested with
regulatory authority over public utilities. Existing law permits a
private energy producer to generate electricity not generated from
conventional sources, as defined, solely for its own use or the use
of its tenants, or generating electricity to or for any electrical
corporation, state agency, city, county, district, or an association
thereof, but not the public, without becoming a public utility
subject to the general jurisdiction of the commission. Existing law
requires the commission to review the charges paid by electrical
corporations to private energy producers for electricity generated by
other than conventional power sources and to review standby and
transmission charges imposed by electrical corporations upon the
private energy producers. The commission is further required, after
the review, to adjust those charges to encourage the generation of
electricity from other than conventional power sources. Existing law
authorizes the City of Davis to receive a bill credit, as defined,
to a benefiting account, as defined, for electricity supplied to the
electric grid by a photovoltaic facility located within and partially
owned by the city and requires the commission to adopt a rate tariff
for the benefiting account.
This bill would authorize the City and County of San Francisco to
elect to designate specific photovoltaic generation facilities
meeting specified conditions as Hetch Hetchy Water and Power (HHWP)
solar generation facilities, and upon election and the filing and
acceptance of an advice letter with the commission establishing
rates, Pacific Gas and Electric Company would be required on a
monthly basis, to credit the City and County of San Francisco for
certain electricity generated and delivered to the electric grid in
accordance with specified rate criteria. The bill would provide for
the termination of this arrangement upon notice from the city and
county or upon the city and county engaging in retail sales to
customers within the service territory of Pacific Gas and Electric
Company, as a result of becoming a community choice aggregator, as a
result of municipalization, or otherwise.
Under existing law, a violation of the Public Utilities Act, a
filed tariff, or an order of the commission is a crime.
Because the provisions of the bill would require an order or other
action of the commission to implement those provisions, a violation
of that order or action would be a crime, and thereby the bill would
impose a state-mandated local program by creating a new crime.
The bill would declare that, due to the special circumstances
applicable only to HHWP solar generation facilities, a general
statute cannot be made applicable within the meaning of Section 16 of
Article IV of the California Constitution, and the enactment of a
special statute is therefore necessary.
The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares each of the
following:
(a) Increasing California's use of solar generated electricity can
promote stable electricity prices, protect public health, improve
environmental quality, create new employment opportunities, and
reduce reliance on fossil fuels.
(b) Electricity for municipal facilities of the City and County of
San Francisco is provided by Hetch Hetchy Water and Power through
electric transmission and distribution lines owned by Pacific Gas and
Electric Company. This situation is unique to the City and County
of San Francisco.
(c) The City and County of San Francisco has declared its
intention to become a community choice aggregator, but until the City
and County of San Francisco begins to procure electricity pursuant
to implementation of community choice aggregation, the City and
County of San Francisco has no acceptable mechanism to market the
temporarily existing excess generation of proposed photovoltaic
projects to be located at San Francisco municipal sites and which may
on occasion exceed the load at the site.
(d) San Francisco is located in a transmission constrained area
that currently requires local generation. Development of solar
electric facilities in San Francisco can improve electric service
reliability and lessen air pollution from fossil fuel powerplants
located in the city and county.
(e) Compensation for the electricity produced from Hetch Hetchy
Water and Power solar generation facilities are in the public
interest.
SEC. 2. Section 2828 is added to the Public Utilities Code, to
read:
2828. (a) As used in this section, the following terms have the
following meanings:
(1) "Environmental attributes" associated with the Hetch Hetchy
Water and Power solar generation include, but are not limited to, the
credits, benefits, emissions reductions, environmental air quality
credits, and emissions reduction credits, offsets, and allowances,
however entitled, resulting from the avoidance of the emission of any
gas, chemical, or other substance attributable to the Hetch Hetchy
Water and Power photovoltaic electricity generation facility owned by
the City and County of San Francisco.
(2) "HHWP solar generation" means the electricity generated by
Hetch Hetchy Water and Power photovoltaic electricity generation
facilities owned by the City and County of San Francisco, designated
by the City and County of San Francisco pursuant to subdivision (b)
and not to exceed five megawatts of peak generation capacity in
total.
(3) "Interconnection Agreement" means the 1987 agreement between
Pacific Gas and Electric Company and the City and County of San
Francisco, as filed with and accepted by the Federal Energy
Regulatory Commission (FERC), and as amended from time to time with
FERC approval, which provides for rates for transmission,
distribution, and sales of supplemental electricity to the City and
County of San Francisco. Nothing in this section shall waive or
modify the rights of parties under the Interconnection Agreement or
the jurisdiction of the FERC over rates set forth in the
Interconnection Agreement.
(4) "Appropriate TOU tariff" means the Time-of-Use tariff that
would be applicable to the City and County of San Francisco account
at the photovoltaic project site if the facility at the site were a
Pacific Gas and Electric Company bundled customer, as determined by
Pacific Gas and Electric Company.
(b) The City and County of San Francisco may elect to designate
specific photovoltaic electricity generation facilities as HHWP solar
generation, if all of the following conditions are met:
(1) No single photovoltaic generation project exceeds one megawatt
of peak generation capacity.
(2) The photovoltaic project utilizes a meter, or multiple meters,
capable of separately measuring electricity flow in both directions.
All meters shall provide "time-of-use" measurement information. If
the existing meter at the site of the photovoltaic project is not
capable of providing time-of-use information or is not capable of
separately measuring total flow of energy in both directions, the
City and County of San Francisco is responsible for all expenses
involved in purchasing and installing a meter or meters that are both
capable of providing time-of-use information and able to separately
measure total electricity flow in both directions.
(3) The amount of all electricity delivered to the electric grid
by the designated HHWP solar generation is the property of Pacific
Gas and Electric Company.
(4) The City and County of San Francisco does not sell electricity
delivered to the electric grid from the designated HHWP solar
generation to a third party.
(5) Ownership and use of the environmental attributes associated
with the electricity delivered to the electric grid by HHWP solar
generation shall be determined by the commission in accordance with
Article 16 (commencing with Section 399.11) of Chapter 2.3 of Part 1.
(c) For each site of a photovoltaic project that comprises the
HHWP solar generation, Pacific Gas and Electric Company shall
identify the appropriate TOU tariff for that site. Any electricity
exported to the Pacific Gas and Electric Company grid at that site
shall, for each time-of-use period, result in a monetary credit to be
applied monthly as a credit or offset against the invoice created
pursuant to the Interconnection Agreement and shall be valued at the
generation component of the appropriate TOU tariff. The commission
shall determine if it is appropriate to increase the credit to
reflect any additional value derived from the location or the
environmental attributes of, the designated HHWP solar generation.
(d) Monthly charges and credit amounts are interim and subject to
an accounting true-up, consistent with commission policies and
practices. The true-up shall be performed annually or upon the
termination, for any reason, of the Interconnection Agreement. The
true-up shall accomplish the following:
(1) If the total electricity delivered to the site by Pacific Gas
and Electric Company since the previous true-up equals or exceeds the
total electricity exported to the grid by the Hetch Hetchy
photovoltaic electricity generation facility at the site, the City
and County of San Francisco is a net electricity consumer at that
site. For any site where the City and County of San Francisco is a
net electricity consumer, a credit or offset shall be applied to
reduce the obligations of the City and County of San Francisco to an
invoice prepared pursuant to the Interconnection Agreement. If there
is no invoiced obligation to be reduced, there is no applicable
credit.
(2) If the total electricity delivered to the site by Pacific Gas
and Electric Company since the previous true-up is less than the
total electricity exported to the grid by the Hetch Hetchy
photovoltaic electricity generation facility at the site, the City
and County of San Francisco is a net electricity producer at that
site. For any site where the City and County of San Francisco is a
net electricity producer, the City and County of San Francisco shall
receive no credit or offset for the electricity exported to the grid
in excess of the electricity delivered to the site from the grid.
For any site where the City and County of San Francisco is a net
electricity producer, the City and County of San Francisco shall
receive a credit or offset up to the amount of electricity delivered
to the site from the grid. The credit or offset shall be applied to
reduce the obligations of the City and County of San Francisco to an
invoice prepared pursuant to the Interconnection Agreement. If there
is no invoiced obligation to be reduced, there is no applicable
credit or offset. Pacific Gas and Electric Company shall use the
last-in, first-out method to determine what electricity delivered to
the grid from the site will not earn a credit or offset.
(e) Notwithstanding any other provision of this section, if the
City and County of San Francisco engages in retail sales to customers
within the service territory of Pacific Gas and Electric Company, as
a result of becoming a community choice aggregator, as a result of
municipalization, or otherwise, all other provisions of this section
become inoperative.
(f) Pursuant to this section, the offset to charges under the
Interconnection Agreement is the medium to convey credits earned
under this section. Nothing in this section shall be construed to
affect in any way the rights and obligations of the City and County
of San Francisco and Pacific Gas and Electric Company under the
Interconnection Agreement.
(g) Pacific Gas and Electric Company shall file an advice letter
with the commission, that complies with this section, not later than
10 days after the City and County of San Francisco first designates
the specific generation facilities that will comprise HHWP solar
generation. The commission, within 30 days of the date of filing of
the advice letter, shall approve the advice letter or specify
conforming changes to be made by Pacific Gas and Electric Company to
be filed in an amended advice letter within 30 days.
(h) The City and County of San Francisco may terminate its
election pursuant to subdivisions (b), (c), and (d), upon providing
Pacific Gas and Electric Company with a minimum of 60 days' written
notice.
SEC. 3. The Legislature finds and declares that, because of the
unique circumstances applicable only to Hetch Hetchy Water and Power
solar generation of electricity, a statute of general applicability
cannot be enacted within the meaning of subdivision (b) of Section 16
of Article IV of the California Constitution. Therefore, this
special statute is necessary.
SEC. 4. No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of the
Government Code, or changes the definition of a crime within the
meaning of Section 6 of Article XIII B of the California
Constitution.