BILL ANALYSIS
Appropriations Committee Fiscal Summary
1685 (Leno)
Hearing Date: 8/28/03 Amended: 8/18/03 and
proposed to
be amended by LCR 317824
Consultant: Lisa Matocq Policy Vote: E, U & C
5-1
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BILL SUMMARY: AB 1685 extends the Self-Generation Incentive
Program (SGIP), until January 1, 2008. Beginning January
1, 2005, it requires distributed generation (DG) projects
operating by combustion to meet certain NOx emission
standards, and beginning January 1, 2007, it requires them
to meet ultra-clean and low-emission standards. It also
makes related changes.
Fiscal Impact (in thousands)
Major Provisions 2003-04 2004-05
2005-06 Fund
State projects -- See
comments below General/
Various
PUC program admin. -- Probably $300-350
annually, Special*
should be offset by fee
revenues
*Public Utilities' Reimbursement Account (PURA)
STAFF COMMENTS: SUSPENSE FILE. The SGIP was established in
2001; it provides incentives to customers that install
qualifying self-generation equipment (renewable, and
"super-clean" nonrenewable), such as photo-voltaics, wind
turbines, small gas turbines, and internal combustion
engines. The program is funded by a distribution charge
imposed on utility bills, which generates about $125
million annually. According to Southern California Edison,
only $33.6 million in incentives has been paid to date.
Although there is no statutory sunset, the PUC established
a December 31, 2004 administrative sunset; their positions
and associated funding expire on June 30, 2004. PUC staff
anticipate renewing the program.
This bill reduces the pool of applicants eligible to
receive incentives. State DG projects, mainly
combustion-operated, have received $2 million in
incentives. As proposed to be amended, at least three of
these projects would meet the new standards in this bill.
Any future state combustion-operated DG projects would be
required to meet the new standards, or would no longer be
eligible for the incentive. The bill also gives the PUC
flexibility to include other technologies, and to consider
public policy interests, such as environmental impacts. It
is unknown what other technologies might be included in the
future. The PUC's costs to continue the program are about
$300,000-$350,000 annually, for five positions.
SB 107 (Bowen), which passed this Committee but is pending
reconsideration in the Assembly Utilities and Commerce
Committee, is similar to this bill.
Proposed author amendments modify the emissions standards
for combustion-operated projects.