BILL NUMBER: AB 1684 CHAPTERED
BILL TEXT
CHAPTER 675
FILED WITH SECRETARY OF STATE SEPTEMBER 22, 2004
APPROVED BY GOVERNOR SEPTEMBER 22, 2004
PASSED THE ASSEMBLY AUGUST 27, 2004
PASSED THE SENATE AUGUST 26, 2004
AMENDED IN SENATE AUGUST 25, 2004
AMENDED IN SENATE AUGUST 23, 2004
AMENDED IN SENATE JULY 19, 2004
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, and declaring the urgency thereof, to
take effect immediately.
LEGISLATIVE COUNSEL'S DIGEST
AB 1684, 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 emissions
standard and, commencing January 1, 2007, meet a more stringent NOx
emissions 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 project that operates solely on
waste gas, as defined, subject to certain requirements.
The bill would declare that it is to take effect immediately as an
urgency statute.
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 Energy
Resources Conservation and Development Commission, shall administer,
until January 1, 2008, 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 it existed on January 1, 2004.
(b) Eligibility for the self-generation incentive program's level
3 incentive category shall be subject to the following conditions:
(1) Commencing January 1, 2005, all combustion-operated
distributed generation projects using fossil fuel shall meet an
oxides of nitrogen (NOx) emissions rate standard of 0.14 pounds per
megawatthour.
(2) Commencing January 1, 2007, all combustion-operated
distributed generation projects using fossil fuel shall meet a 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.
(3) Combined heat and power units that meet the 60 percent
efficiency standard may take a credit to meet the applicable NOx
emissions 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) 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 applies for an incentive pursuant to
this paragraph to provide an affidavit or other form of proof, 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. 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 an onsite net air emissions
benefit, compared to permitted onsite emissions if the project does
not operate. The commission shall require the customer to secure the
permit prior to receiving incentives.
(c) In administering the self-generation incentive program, the
commission may adjust the amount of rebates, include other ultraclean
and low-emission distributed generation technologies, as defined in
Section 353.2, and evaluate other public policy interests, including,
but not limited to, ratepayers, and energy efficiency and
environmental interests.
SEC. 2. This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
Chapter 894 of the Statutes of 2003, through an inadvertent
omission, rendered waste gas electric generation units ineligible for
participation in the Public Utility Commission's self-generation
incentive program. As a result, solid waste gas is currently being
burned into the atmosphere instead of producing much needed electric
power. In order to increase the state's electric energy supply and
reduce emissions from flared waste gas without delay, it is necessary
that this act go into immediate effect.