BILL NUMBER: AB 1684 AMENDED
BILL TEXT
AMENDED IN SENATE JUNE 14, 2004
AMENDED IN ASSEMBLY JANUARY 16, 2004
AMENDED IN ASSEMBLY JANUARY 14, 2004
AMENDED IN ASSEMBLY JANUARY 5, 2004
INTRODUCED BY Assembly Members Leno and Oropeza
FEBRUARY 21, 2003
An act to amend Section 379.6 of the Public Utilities Code,
relating to energy resources.
LEGISLATIVE COUNSEL'S DIGEST
AB 1684, as amended, Leno. Distributed generation resources.
Existing law requires the Public Utilities Commission on or before
March 7, 2001, and in consultation with the Independent System
Operator, to take certain actions, including, in consultation with
the State Energy Resources Conservation and Development Commission
(Energy Commission), adopting energy conservation demand-side
management and other initiatives in order to reduce demand for
electricity and reduce load during peak demand periods, including,
but not limited to, differential incentives for renewable or
superclean distributed generation resources. Pursuant to this
requirement, the commission has developed a self-generation incentive
program to encourage customers of electrical corporations to install
distributed generation that operates on renewable fuel or
contributes to system reliability.
Existing law requires the commission, in consultation with the
Energy Commission, to administer, until January 1, 2008, a
self-generation incentive program for distributed generation
resources in the same form that exists on January 1, 2004. This
program requires that combustion-operated distributed generation
using nonrenewable fuel, in order to be eligible for incentive
rebates, commencing January 1, 2005, meet a certain NOx emission
standard and , commencing January 1, 2007, meet a more
stringent NOx emission standard and a minimum efficiency standard.
This existing program establishes, as of January 1, 2007, a credit
for combined heat and power units that meet a certain efficiency
standard.
This bill would expand the self-generation incentive program to
make eligible for incentive rebates , a combustion-operated
distributed generation project that operates solely on natural gas
that is not eligible for delivery to the utility pipeline system,
provided certain air emissions benefits are achieved from the project
a project that operates solely on waste gas, as
defined, subject to certain requirements .
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. Section 379.6 of the Public Utilities Code is amended
to read:
379.6. (a) The commission, in consultation with the State
379.6. (a) The commission, in consultation with the State Energy
Resources Conservation and Development Commission, shall
administer, until January 1, 2008, administer a
the self-generation incentive program for
distributed generation resources , originally
established pursuant to Chapter 329 of the Statutes of 2000. Except
as provided in subdivision (b), the program shall be administered
in the same form as exists it existed
on January 1, 2004.
(b) Notwithstanding subdivision (a),
Eligibility for the self-generation incentive program
program's level 3 incentive category shall
do all of the following be subject to the
following conditions :
(1) Commencing January 1, 2005, require all
combustion-operated distributed generation projects using fossil
fuels to shall meet an oxides of
nitrogen (NOx) emissions rate standard of 0.14 pounds per
megawatthour to be eligible for self-generation rebates
.
(2) Commencing January 1, 2007, require all
combustion-operated distributed generation projects using fossil
fuels to shall meet an oxides
of nitrogen (NOx) a NOx emissions rate standard
of 0.07 pounds per megawatthour and a minimum efficiency of 60
percent , to be eligible for self-generation rebates
. A minimum efficiency of 60 percent shall be measured as
useful energy output divided by fuel input. The efficiency
determination shall be based on 100 percent load.
(3) Combined heat and power units that meet the 60 percent
efficiency standard may take a credit to meet the applicable
oxides of nitrogren (NOx) NOx emission standard
of 0.14 pounds per megawatthour or 0.07 pounds per megawatthour.
Credit shall be at the rate of one megawatthour for each 3.4 million
British thermal units (Btus) of heat recovered.
(4) Provide the commission with flexibility in
Notwithstanding paragraphs (1) and (2), a project that does not
meet the applicable NOx emission standard is eligible if it meets
both of the following requirements:
(A) The project operates solely on waste gas. The commission
shall require a customer that receives an incentive pursuant to this
paragraph to secure an interconnection agreement that specifies that
the project shall be operated solely on waste gas. Incentives
awarded pursuant to this paragraph shall be subject to refund and
shall be refunded by the recipient to the extent the project does not
operate on waste gas. A gas corporation or other gas supplier shall
report to the commission any deliveries of gas for a project that
has been awarded an incentive pursuant to this paragraph. As used in
this paragraph, "waste gas" means natural gas that is generated as a
byproduct of petroleum production operations and is not eligible for
delivery to the utility pipeline system.
(B) The air quality management district or air pollution control
district, in issuing a permit to operate the project, determines that
operation of the project will produce a net air emissions benefit,
compared to permitted emissions if the project does not operate.
(c) In administering the self-generation incentive program,
including, but not limited to, flexibility with regard to
the commission may adjust the amount of rebates,
inclusion of include other ultra clean
and low emission distributed generation technologies , as
defined in Section 353.2 , and evaluation of
evaluate other public policy interests, including, but
not limited to, ratepayers, and energy efficiency and environmental
interests. Energy Resources Conservation and Development
Commission, shall administer, until January 1, 2008, a
self-generation incentive program for distributed generation
resources, in the same form as exists on January 1, 2004.
(b) Notwithstanding subdivision (a), the self-generation incentive
program shall do all of the following:
(1) Commencing January 1, 2005, require all combustion-operated
distributed generation projects using fossil fuels to do either of
the following to be eligible for self-generation rebates under the
level 3 incentive category for nonrenewables, as established by the
commission in Decision 01-03-073, dated March 27, 2001:
(A) Meet an oxides of nitrogen (NOx) emissions rate standard of
0.14 pounds per megawatthour.
(B) Operate solely on natural gas that is not eligible for
delivery to the utility pipeline system, and demonstrate that the
project will provide a net air emissions benefit to the facilities'
operations, which benefit shall be certified by the air quality
management district or air pollution control district.
(2) Commencing January 1, 2007, require all combustion-operated
distributed generation projects using fossil fuels to do either of
the following to be eligible for self-generation rebates under the
level 3 incentive category for nonrenewables, as established by the
commission in Decision 01-03-073, dated March 27, 2001:
(A) Meet an oxides of nitrogen (NOx) emissions rate standard of
0.07 pounds per megawatthour and a minimum efficiency of 60 percent.
A minimum efficiency of 60 percent shall be measured as useful
energy output divided by fuel input. The efficiency determination
shall be based on 100 percent load. Combined heat and power units
that meet the 60 percent efficiency standard may take a credit to
meet the applicable oxides of nitrogen (NOx) emission standard of
0.14 pounds per megawatthour or 0.07 pounds per megawatthour. Credit
shall be at the rate of one megawatthour for each 3.4 million
British thermal units (Btus) of heat recovered.
(B) Operate solely on natural gas that is not eligible for
delivery to the utility pipeline system, and demonstrate that the
project will provide a net air emissions benefit to the facilities'
operations, which benefit shall be certified by the air quality
management district or air pollution control district.
(3) Provide the commission with flexibility in administering the
self-generation incentive program, including, but not limited to,
flexibility with regard to the amount of rebates, inclusion of other
ultra-clean and low-emission distributed generation technologies, and
evaluation of other public policy interests, including, but not
limited to, ratepayers, and energy efficiency and environmental
interests.