BILL NUMBER: SB 118 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY AUGUST 23, 2004
AMENDED IN ASSEMBLY JUNE 19, 2003
AMENDED IN SENATE MAY 7, 2003
AMENDED IN SENATE APRIL 21, 2003
INTRODUCED BY Senator Bowen
FEBRUARY 3, 2003
An act to amend Section 303 of the Public Utilities Code,
relating to the Public Utilities Commission. An act
to add Division 16.7 (commencing with Section 26420) to the Public
Resources Code, and to amend Sections 399.15 and 2827 of, and to add
Chapter 8 (commencing with Section 2830) to, the Public Utilities
Code, relating to solar energy.
LEGISLATIVE COUNSEL'S DIGEST
SB 118, as amended, Bowen. Public Utilities Commission:
conflict of interest Solar energy generation .
(1) Existing law requires the Public Utilities Commission, in
consultation with the Independent System Operator and the State
Energy Resources Conservation and Development Commission, to adopt
initiatives, on or before March 7, 2001, to reduce demand for
electricity and reduce load during peak demand periods, including
differential incentives for renewable or super clean distributed
generation resources. 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 bill would require the State Energy Resources Conservation
and Development Commission, not later than July 1, 2005, to award
rebates to support the installation of grid-connected solar energy
systems, subject to a prescribed declining schedule terminating as of
January 1, 2015. The bill would require 5% of the program to be
dedicated for defined affordable housing. The bill would also require
the commission to develop a zero-interest revolving loan program by
June 30, 2005, to finance grid-connected solar energy systems for
affordable housing projects. These provisions would be known as the
Solar Energy Peak Procurement Act.
The bill would require the Public Utilities Commission to
establish a program, known as the Solar Energy Peak Procurement
Program, to encourage the use of photovoltaic systems. The bill
would require the commission to fund the program by reducing
purchases of electricity, spending unallocated funds previously
authorized for demand management and interruptible programs, and
substituting a photovoltaic incentive program for less cost effective
demand management and interruptible programs.
The bill would create the Solar Peak Energy Procurement Fund for
expenditure, upon appropriation, for a state program of subsidizing
all customer classes for the installed cost grid-connected solar
photovoltaic systems in the service territory of investor-owned
utilities. The bill would also create the Solar Peak Energy
Affordable Housing Revolving Fund for the same purpose, but limited
to subsidies for defined affordable housing units. The bill would
require the Public Utilities Commission to direct utilities to
deposit a portion of electric rate revenues in the Solar Peak Energy
Procurement Fund from unallocated funds previously authorized for
demand management and interruptible programs and rates that
previously paid for those programs and that the commission determines
are less cost effective than the photovoltaic incentive system
established by the bill.
(2) Existing law requires the Public Utilities Commission to
establish a renewables portofolio standard requiring all electrical
corporations to to procure a minimum quantity of output from
renewable energy resources, as specified. Existing law requires the
commission to implement prescribed annual procurement targets for
electrical corporations use of renewable energy resources.
This bill would specify that electricity generated from
net-metered solar energy systems shall be counted towards an
electrical corporation's annual renewable energy resource procurement
targets.
(3) Existing law requires every electric service provider, as
defined, to develop a standard contract or tariff providing for net
energy metering, and to make this contract available to eligible
customer generators, upon request. Existing law requires every
electric service provider, upon request, to make available to
eligible customer generators contracts for net energy metering on a
first-come-first-served basis until the time that the total rated
generating capacity used by eligible customer generators exceeds 0.5%
of the electric service provider's aggregate customer peak demand.
This bill would require that every electric service provider, upon
request, make available to eligible customer generators contracts
for net energy metering on a first-come-first-served basis until the
time that the total rated generating capacity used by eligible
customer generators exceeds 3% of the electric service provider's
aggregate customer peak demand.
(4) The bill would not become operative unless Assembly Bill 2006
is enacted.
Under existing law, no person may be appointed to or hold the
office of public utilities commissioner who also is employed by,
holds any official relation with, owns stocks or bonds of, or is in
any manner pecuniarily interested in, any corporation or person that
is subject to regulation by the commission. Existing law requires
the commission to adopt an updated Conflict of Interest Code and
Statement of Incompatible Activities, by February 28, 1998, in a
manner consistent with applicable law.
This bill would provide that the office of any commissioner who
voluntarily acquires a financial interest, as defined, in a
corporation or person that the commissioner knows or should know is
subject to regulation by the commission, will immediately become
vacant, and would require the commission to adopt an updated Conflict
of Interest Code and Statement of Incompatible Activities, by
February 28, 2004, in a manner consistent with applicable law.
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 303 of the Public Utilities Code is
SECTION 1. This act shall be known, and may be cited as the Solar
Energy Peak Procurement Act.
SEC. 2. Division 16.7 (commencing with Section 26421) is added to
the Public Resources Code, to read:
DIVISION 16.7. SOLAR ENERGY SYSTEM REBATES
26421. (a) "Affordable housing," as used in this division, means
a housing project undertaken pursuant to Section 50052.5, 50053, or
50199.4 of the Health and Safety Code.
(b) "Solar energy system," as used in this division, means a
photovoltaic solar collector or other photovoltaic solar energy
device that has a primary purpose of providing for the collection,
storage, and distribution of solar energy for the generation of
electricity. A solar energy system shall have a minimum manufacturer'
s warranty, as determined by the commission, and shall meet all
applicable safety and performance standards established by the
National Electrical Code, the institute of Electrical and Electronics
Engineers, and accredited testing laboratories such as Underwriters
laboratories and, where applicable, rules of the Public Utilities
Commission regarding safety and reliability.
26422. (a) Not later than July 1, 2005, the commission shall
award rebates to support the installation of grid-connected solar
energy systems and shall adopt a schedule of declining rebates for
this purpose, subject to all of the following:
(1) The maximum rebate in year one shall be no greater than three
dollars ($3) per watt, and shall decline each year thereafter as
determined by the commission.
(2) The rebate shall be zero as of January 1, 2015.
(b) The program shall be funded through the Solar Peak Energy
Procurement Fund as provided in Section 2832 of the Public Utilities
Code.
(c) Five percent of funding received for this program shall be
dedicated to rebates for reducing the cost of grid-connected solar
energy systems for affordable housing.
(d) By June 30, 2005 the commission shall also develop a
zero-interest revolving loan program to finance grid-connected solar
energy systems for affordable housing projects. This program shall
be funded from the Solar Peak Energy Affordable Housing Revolving
Fund as provided in Section 2832 of the Public Utilities Code.
SEC. 2. Section 399.15 of the Public Utilities Code is amended to
read:
399.15. (a) In order to fulfill unmet long-term resource needs,
the commission shall establish a renewables portfolio standard
requiring all electrical corporations to procure a minimum quantity
of output from eligible renewable energy resources as a specified
percentage of total kilowatthours sold to their retail end-use
customers each calendar year, if sufficient funds are made available
pursuant to paragraph (2), and Sections 399.6 and 383.5 to cover the
above-market costs of eligible renewables, and subject to all of the
following:
(1) An electric corporation shall not be required to enter into
long-term contracts with eligible renewable energy resources that
exceed the market prices established pursuant to subdivision (c) of
this section.
(2) The Energy Commission shall provide supplemental energy
payments from funds in the New Renewable Resources Account in the
Renewable Resource Trust Fund to eligible renewable energy resources
pursuant to Section 383.5,, consistent with this article, for
above-market costs. Indirect costs associated with the purchase of
eligible renewable energy resources, such as imbalance energy
charges, sale of excess energy, decreased generation from existing
resources, or transmission upgrades shall not be eligible for
supplemental energy payments, but shall be recoverable by an
electrical corporation in rates, as authorized by the commission.
(3) For purposes of setting annual procurement targets, the
commission shall establish an initial baseline for each electrical
corporation based on the actual percentage of retail sales procured
from eligible renewable energy resources in 2001, and, to the extent
applicable, adjusted going forward pursuant to subdivision (a) of
Section 399.12.
(4) Electricity generated from net metered solar energy systems
shall be counted towards an electrical corporation's annual
renewable energy resource procurement targets.
(b) The commission shall implement annual procurement targets for
each electrical corporation as follows:
(1) Beginning on January 1, 2003, each electrical corporation
shall, pursuant to subdivision (a), increase its total procurement of
eligible renewable energy resources by at least an additional 1
percent of retail sales per year so that 20 percent of its retail
sales are procured from eligible renewable energy resources no later
than December 31, 2017. An electrical corporation with 20 percent of
retail sales procured from eligible renewable energy resources in
any year shall not be required to increase its procurement of such
resources in the following year.
(2) Only for purposes of establishing these targets, the
commission shall include all power sold to retail customers by the
Department of Water Resources pursuant to Section 80100 of the Water
Code in the calculation of retail sales by an electrical corporation.
(3) In the event that an electrical corporation fails to procure
sufficient eligible renewable energy resources in a given year to
meet any annual target established pursuant to this subdivision, the
electrical corporation shall procure additional eligible renewable
energy resources in subsequent years to compensate for the shortfall
if sufficient funds are made available pursuant to paragraph (2), and
Sections 399.6 and 383.5 to cover the above-market costs of eligible
renewables.
(4) If supplemental energy payments from the Energy Commission, in
combination with the market prices approved by the commission, are
insufficient to cover the above-market costs of eligible renewable
energy resources, the commission shall allow an electrical
corporation to limit its annual procurement obligation to the
quantity of eligible renewable energy resources that can be procured
with available supplemental energy payments.
(c) The commission shall establish a methodology to determine the
market price of electricity for terms corresponding to the length of
contracts with renewable generators, in consideration of the
following:
(1) The long-term market price of electricity for fixed price
contracts, determined pursuant to the electrical corporation's
general procurement activities as authorized by the commission.
(2) The long-term ownership, operating, and fixed-price fuel costs
associated with fixed-price electricity from new generating
facilities.
(3) The value of different products including baseload, peaking,
and as-available output.
(d) The establishment of a renewables portfolio standard shall not
constitute implementation by the commission of the federal Public
Utility Regulatory Policies Act of 1978 (Public Law 95-617).
(e) The commission shall consult with the Energy Commission in
calculating market prices under subdivision (c) and establishing
other renewables portfolio standard policies.
SEC. 3. Section 2827 of the Public Utilities Code is amended to
read:
2827. (a) The Legislature finds and declares that a program to
provide net energy metering for eligible customer-generators is one
way to encourage substantial private investment in renewable energy
resources, stimulate in-state economic growth, reduce demand for
electricity during peak consumption periods, help stabilize
California's energy supply infrastructure, enhance the continued
diversification of California's energy resource mix, and reduce
interconnection and administrative costs for electricity suppliers.
(b) As used in this section, the following definitions apply:
(1) "Electric service provider" means an electrical corporation,
as defined in Section 218, a local publicly owned electric utility,
as defined in Section 9604, or an electrical cooperative, as defined
in Section 2776, or any other entity that offers electrical service.
This section shall not apply to a local publicly owned electric
utility, as defined in Section 9604 of the Public Utilities Code,
that serves more than 750,000 customers and that also conveys water
to its customers.
(2) "Eligible customer-generator" means a residential, small
commercial customer as defined in subdivision (h) of Section 331,
commercial, industrial, or agricultural customer of an electric
service provider, who uses a solar or a wind turbine electrical
generating facility, or a hybrid system of both, with a capacity of
not more than one megawatt that is located on the customer's owned,
leased, or rented premises, is interconnected and operates in
parallel with the electric grid, and is intended primarily to offset
part or all of the customer's own electrical requirements.
(3) "Net energy metering" means measuring the difference between
the electricity supplied through the electric grid and the
electricity generated by an eligible customer-generator and fed back
to the electric grid over a 12-month period as described in
subdivision (h). Net energy metering shall be accomplished using a
single meter capable of registering the flow of electricity in two
directions. An additional meter or meters to monitor the flow of
electricity in each direction may be installed with the consent of
the customer-generator, at the expense of the electric service
provider, and the additional metering shall be used only to provide
the information necessary to accurately bill or credit the
customer-generator pursuant to subdivision (h), or to collect solar
or wind electric generating system performance information for
research purposes. If the existing electrical meter of an eligible
customer-generator is not capable of measuring the flow of
electricity in two directions, the customer-generator shall be
responsible for all expenses involved in purchasing and installing a
meter that is able to measure electricity flow in two directions. If
an additional meter or meters are installed, the net energy metering
calculation shall yield a result identical to that of a single
meter. An eligible customer-generator who already owns an existing
solar or wind turbine electrical generating facility, or a hybrid
system of both, is eligible to receive net energy metering service in
accordance with this section.
(4) "Wind energy co-metering" means any wind energy project
greater than 50 kilowatts, but not exceeding one megawatt, where the
difference between the electricity supplied through the electric grid
and the electricity generated by an eligible customer-generator and
fed back to the electric grid over a 12-month period is as described
in subdivision (h). Wind energy co-metering shall be accomplished
pursuant to Section 2827.8.
(5) "Co-energy metering" means a program that is the same in all
other respects as a net energy metering program, except that the
local publicly owned electric utility, as defined in Section 9604,
has elected to apply a generation-to-generation energy and
time-of-use credit formula as provided in subdivision (i).
(6) "Ratemaking authority" means, for an electrical corporation as
defined in Section 218, or an electrical cooperative as defined in
Section 2776, the commission, and for a local publicly owned electric
utility as defined in Section 9604, the local elected body
responsible for regulating the rates of the local publicly owned
utility.
(c) (1) Every electric service provider shall develop a standard
contract or tariff providing for net energy metering, and shall make
this contract available to eligible customer-generators, upon
request, on a first-come-first-served basis until the time that the
total rated generating capacity used by eligible customer-generators
exceeds one-half of 1 3 percent of the
electric service provider's aggregate customer peak demand.
(2) On an annual basis, beginning in 2003, every electric service
provider shall make available to the ratemaking authority information
on the total rated generating capacity used by eligible
customer-generators that are customers of that provider in the
provider's service area. For those electric service providers who
are operating pursuant to Section 394, they shall make available to
the ratemaking authority the information required by this paragraph
for each eligible customer-generator that is their customer for each
service area of an electric corporation, local publicly owned
electric utility, or electrical cooperative, in which the customer
has net energy metering. The ratemaking authority shall develop a
process for making the information required by this paragraph
available to energy service providers, and for using that information
to determine when, pursuant to paragraph (3), a service provider is
not obligated to provide net energy metering to additional
customer-generators in its service area.
(3) Notwithstanding paragraph (1), an electric service provider is
not obligated to provide net energy metering to additional
customer-generators in its service area when the combined total peak
demand of all customer-generators served by all the electric service
providers in that service area furnishing net energy metering to
eligible customer-generators exceeds one-half of 1
3 percent of the aggregate customer peak demand of those
electric service providers.
(d) Electric service providers shall make all necessary forms and
contracts for net metering service available for download from the
Internet.
(e) (1) Every electric service provider shall ensure that requests
for establishment of net energy metering are processed in a time
period not exceeding that for similarly situated customers requesting
new electric service, but not to exceed 30 working days from the
date the electric service provider receives a completed application
form for net metering service, including a signed interconnection
agreement from an eligible customer-generator and the electric
inspection clearance from the governmental authority having
jurisdiction. If an electric service provider is unable to process
the request within the allowable timeframe, the electric service
provider shall notify both the customer-generator and the ratemaking
authority of the reason for its inability to process the request and
the expected completion date.
(2) Electric service providers shall ensure that requests for an
interconnection agreement from an eligible customer-generator are
processed in a time period not to exceed 30 working days from the
date the electric service provider receives a completed application
form from the eligible customer-generator for an interconnection
agreement. If an electric service provider is unable to process the
request within the allowable timeframe, the electric service provider
shall notify the customer-generator and the ratemaking authority of
the reason for its inability to process the request and the expected
completion date.
(f) (1) If a customer participates in direct transactions pursuant
to paragraph (1) of subdivision (b) of Section 365 with an electric
supplier that does not provide distribution service for the direct
transactions, the service provider that provides distribution service
for an eligible customer-generator is not obligated to provide net
energy metering to the customer.
(2) If a customer participates in direct transactions pursuant to
paragraph (1) of subdivision (b) of Section 365 with an electric
supplier, and the customer is an eligible customer-generator, the
service provider that provides distribution service for the direct
transactions may recover from the customer's electric service
provider the incremental costs of metering and billing service
related to net energy metering in an amount set by the ratemaking
authority.
(g) Each net energy metering contract or tariff shall be
identical, with respect to rate structure, all retail rate
components, and any monthly charges, to the contract or tariff to
which the same customer would be assigned if the customer did not use
an eligible solar or wind electrical generating facility, except
that eligible customer-generators shall not be assessed standby
charges on the electrical generating capacity or the kilowatthour
production of an eligible solar or wind electrical generating
facility. The charges for all retail rate components for eligible
customer-generators shall be based exclusively on the
customer-generator's net kilowatthour consumption over a 12-month
period, without regard to the customer-generator's choice of electric
service provider. Any new or additional demand charge, standby
charge, customer charge, minimum monthly charge, interconnection
charge, or any other charge that would increase an eligible
customer-generator's costs beyond those of other customers who are
not customer-generators in the rate class to which the eligible
customer-generator would otherwise be assigned if the customer did
not own, lease, rent, or otherwise operate an eligible solar or wind
electrical generating facility are contrary to the intent of this
section, and shall not form a part of net energy metering contracts
or tariffs.
(h) For eligible residential and small commercial
customer-generators, the net energy metering calculation shall be
made by measuring the difference between the electricity supplied to
the eligible customer-generator and the electricity generated by the
eligible customer-generator and fed back to the electric grid over a
12-month period. The following rules shall apply to the annualized
net metering calculation:
(1) The eligible residential or small commercial
customer-generator shall, at the end of each 12-month period
following the date of final interconnection of the eligible
customer-generator's system with an electric service provider, and at
each anniversary date thereafter, be billed for electricity used
during that period. The electric service provider shall determine if
the eligible residential or small commercial customer-generator was
a net consumer or a net producer of electricity during that period.
(2) At the end of each 12-month period, where the electricity
supplied during the period by the electric service provider exceeds
the electricity generated by the eligible residential or small
commercial customer-generator during that same period, the eligible
residential or small commercial customer-generator is a net
electricity consumer and the electric service provider shall be owed
compensation for the eligible customer-generator's net kilowatthour
consumption over that same period. The compensation owed for the
eligible residential or small commercial customer-generator's
consumption shall be calculated as follows:
(A) For all eligible customer-generators taking service under
tariffs employing "baseline" and "over baseline" rates, any net
monthly consumption of electricity shall be calculated according to
the terms of the contract or tariff to which the same customer would
be assigned to or be eligible for if the customer was not an eligible
customer-generator. If those same customer-generators are net
generators over a billing period, the net kilowatthours generated
shall be valued at the same price per kilowatthour as the electric
service provider would charge for the baseline quantity of
electricity during that billing period, and if the number of
kilowatthours generated exceeds the baseline quantity, the excess
shall be valued at the same price per kilowatthour as the electric
service provider would charge for electricity over the baseline
quantity during that billing period.
(B) For all eligible customer-generators taking service under
tariffs employing "time of use" rates, any net monthly consumption of
electricity shall be calculated according to the terms of the
contract or tariff to which the same customer would be assigned to or
be eligible for if the customer was not an eligible
customer-generator. When those same customer-generators are net
generators during any discrete time of use period, the net
kilowatthours produced shall be valued at the same price per
kilowatthour as the electric service provider would charge for retail
kilowatthour sales during that same time of use period. If the
eligible customer-generator's time of use electrical meter is unable
to measure the flow of electricity in two directions, paragraph (3)
of subdivision (b) shall apply.
(C) For all residential and small commercial customer-generators
and for each billing period, the net balance of moneys owed to the
electric service provider for net consumption of electricity or
credits owed to the customer-generator for net generation of
electricity shall be carried forward as a monetary value until the
end of each 12-month period. For all commercial, industrial, and
agricultural customer-generators the net balance of moneys owed shall
be paid in accordance with the electric service provider's normal
billing cycle, except that if the commercial, industrial, or
agricultural customer-generator is a net electricity producer over a
normal billing cycle, any excess kilowatthours generated during the
billing cycle shall be carried over to the following billing period
as a monetary value, calculated according to the procedures set forth
in this section, and appear as a credit on the customer-generator's
account, until the end of the annual period when paragraph (3) shall
apply.
(3) At the end of each 12-month period, where the electricity
generated by the eligible customer-generator during the 12-month
period exceeds the electricity supplied by the electric service
provider during that same period, the eligible customer-generator is
a net electricity producer and the electric service provider shall
retain any excess kilowatthours generated during the prior 12-month
period. The eligible customer-generator shall not be owed any
compensation for those excess kilowatthours unless the electric
service provider enters into a purchase agreement with the eligible
customer-generator for those excess kilowatthours.
(4) The electric service provider shall provide every eligible
residential or small commercial customer-generator with net
electricity consumption information with each regular bill. That
information shall include the current monetary balance owed the
electric service provider for net electricity consumed since the last
12-month period ended. Notwithstanding this subdivision, an
electric service provider shall permit that customer to pay monthly
for net energy consumed.
(5) If an eligible residential or small commercial
customer-generator terminates the customer relationship with the
electric service provider, the electric service provider shall
reconcile the eligible customer-generator's consumption and
production of electricity during any part of a 12-month period
following the last reconciliation, according to the requirements set
forth in this subdivision, except that those requirements shall apply
only to the months since the most recent 12-month bill.
(6) If an electric service provider providing net metering to a
residential or small commercial customer-generator ceases providing
that electrical service to that customer during any 12-month period,
and the customer-generator enters into a new net metering contract or
tariff with a new electric service provider, the 12-month period,
with respect to that new electric service provider, shall commence on
the date on which the new electric service provider first supplies
electric service to the customer-generator.
(i) Notwithstanding any other provisions of this section, the
following provisions shall apply to an eligible customer-generator
with a capacity of more than 10 kilowatts, but not exceeding one
megawatt, that receives electrical service from a local publicly
owned electric utility, as defined in Section 9604, that has elected
to utilize a co-energy metering program unless the electric service
provider chooses to provide service for eligible customer-generators
with a capacity of more than 10 kilowatts in accordance with
subdivisions (g) and (h):
(1) The eligible customer-generator shall be required to utilize a
meter, or multiple meters, capable of separately measuring
electricity flow in both directions. All meters shall provide
"time-of-use" measurements of electricity flow, and the customer
shall take service on a time-of-use rate schedule. If the existing
meter of the eligible customer-generator is not a time-of-use meter
or is not capable of measuring total flow of energy in both
directions, the eligible customer-generator shall be responsible for
all expenses involved in purchasing and installing a meter that is
both time-of-use and able to measure total electricity flow in both
directions. This subdivision shall not restrict the ability of an
eligible customer-generator to utilize any economic incentives
provided by a government agency or the electric service provider to
reduce its costs for purchasing and installing a time-of-use meter.
(2) The consumption of electricity from the electric service
provider shall result in a cost to the eligible customer-generator to
be priced in accordance with the standard rate charged to the
eligible customer-generator in accordance with the rate structure to
which the customer would be assigned if the customer did not use an
eligible solar or wind electrical generating facility. The
generation of electricity provided to the electric service provider
shall result in a credit to the eligible customer-generator and shall
be priced in accordance with the generation component, established
under the applicable structure to which the customer would be
assigned if the customer did not use an eligible solar or wind
electrical generating facility.
(3) All costs and credits shall be shown on the eligible
customer-generator's bill for each billing period. In any months in
which the eligible customer-generator has been a net consumer of
electricity calculated on the basis of value determined pursuant to
paragraph (2), the customer-generator shall owe to the electric
service provider the balance of electricity costs and credits during
that billing period. In any billing period in which the eligible
customer-generator has been a net
producer of electricity calculated on the basis of
value determined pursuant to paragraph (2), the electric service
provider shall owe to the eligible customer-generator the balance of
electricity costs and credits during that billing period. Any net
credit to the eligible customer-generator of electricity costs may be
carried forward to subsequent billing periods, provided that an
electric service provider may choose to carry the credit over as a
kilowatt hour credit consistent with the provisions of any applicable
tariff, including any differences attributable to the time of
generation of the electricity. At the end of each 12-month period,
the electric service provider may reduce any net credit due to the
eligible customer-generator to zero.
(j) A solar or wind turbine electrical generating system, or a
hybrid system of both, used by an eligible customer-generator shall
meet all applicable safety and performance standards established by
the National Electrical Code, the Institute of Electrical and
Electronics Engineers, and accredited testing laboratories such as
Underwriters Laboratories and, where applicable, rules of the Public
Utilities Commission regarding safety and reliability. A
customer-generator whose solar or wind turbine electrical generating
system, or a hybrid system of both, meets those standards and rules
shall not be required to install additional controls, perform or pay
for additional tests, or purchase additional liability insurance.
(k) If the commission determines that there are cost or revenue
obligations for an electric corporation, as defined in Section 218,
that may not be recovered from customer-generators acting pursuant to
this section, those obligations shall remain within the customer
class from which any shortfall occurred and may not be shifted to any
other customer class. Net-metering and co-metering customers shall
not be exempt from the public benefits charge. In its report to the
Legislature, the commission shall examine different methods to ensure
that the public benefits charge remains a nonbypassable charge.
(l) A net metering customer shall reimburse the Department of
Water Resources for all charges that would otherwise be imposed on
the customer by the commission to recover bond-related costs pursuant
to an agreement between the commission and the Department of Water
Resources pursuant to Section 80110 of the Water Code, as well as the
costs of the department equal to the share of the department's
estimated net unavoidable power purchase contract costs attributable
to the customer. The commission shall incorporate the determination
into an existing proceeding before the commission, and shall ensure
that the charges are nonbypassable. Until the commission has made a
determination regarding the nonbypassable charges, net metering shall
continue under the same rules, procedures, terms, and conditions as
were applicable on December 31, 2002.
(m) In implementing the requirements of subdivisions (k) and (l),
a customer-generator shall not be required to replace its existing
meter except as set forth in paragraph (3) of subdivision (b), nor
shall the electric service provider require additional measurement of
usage beyond that which is necessary for customers in the same rate
class as the eligible customer-generator.
(n) On or before January 1, 2005, the commission shall submit a
report to the Governor and the Legislature that assesses the economic
and environmental costs and benefits of net metering to
customer-generators, ratepayers, and utilities, including any
beneficial and adverse effects on public benefit programs and special
purpose surcharges. The report shall be prepared by an independent
party under contract with the commission.
(o) It is the intent of the Legislature that the Treasurer
incorporate net energy metering and co-energy metering projects
undertaken pursuant to this section as sustainable building methods
or distributive energy technologies for purposes of evaluating
low-income housing projects.
SEC. 4. Chapter 8 (commencing with Section 2830) is added to the
Public Utilities Code, to read:
CHAPTER 8. SOLAR ENERGY PEAK PROCUREMENT PROGRAM
2830. (a) The Legislature finds and declares that:
(1) Electricity created from solar energy using photovoltaic
systems provides reliable electricity during peak demand periods.
(2) Electricity generated by photovoltaic systems is a reliable
substitute for the purchase of expensive, conventionally-generated
electricity during peak demand periods.
(3) Electricity generated by photovoltaic systems is a substitute
for demand management activities which lower peak demand.
(4) Electricity generated by photovoltaic systems is a substitute
for interruptible energy programs which lower peak demand.
(5) The commission requires utilities to procure peak demand
period electricity supplies and allocates those costs to all
customers.
(6) The commission has established demand management programs and
interruptible energy programs whose costs are allocated to all
customers.
(7) It is the intent of the Legislature that this program remain
in effect for 10 years and that the subsidy level per kilowatt of
capacity be reduced to zero at the end of those 10 years.
(b) It is the intent of the Legislature that this program be
funded at a level of one hundred million dollars ($100,000,000)
annually and that this program not result in fee or rate increases.
(c) It is the intent of the Legislature that the customers of each
utility benefit in proportion to the amount paid for the program by
those customers.
(d) It is the intent of the Legislature that existing photovoltaic
programs be harmonized with the program established by this
legislation.
2831. The commission shall establish the Solar Energy Peak
Procurement Program, as provided in this chapter, to encourage the
use of solar photovoltaic systems and shall fund that program by
reducing the purchases of electricity during peak demand periods,
spending unallocated funds previously authorized for demand
management and interruptible programs, and substituting a
photovoltaic incentive program for less cost-effective demand
management and interruptible programs.
2832. (a) The Solar Peak Energy Procurement Fund is hereby
created in the State Treasury. Moneys in the fund may be expended,
upon appropriation by the Legislature, for the state's administration
of the program, to be used to encourage the deployment of
grid-connected solar photovoltaic systems in the service territory of
investor-owned utilities by subsidizing the installed cost of those
systems for all customer classes.
(b) The Solar Peak Energy Affordable Housing Revolving Fund is
hereby created in the State Treasury. Moneys in the fund may be
expended, upon appropriation by the Legislature, for the state's
administration of the program established by this chapter, to be used
to encourage the deployment of grid-connected solar photovoltaic
systems in the service territory of investor-owned utilities by
subsidizing the installed cost of those systems exclusively for
affordable housing units, as defined in subdivision (a) of Section
26420 of the Public Resources Code.
2833. The commission shall direct utilities to regularly deposit
a portion of the moneys derived from electric rates into the Solar
Peak Energy Procurement Fund. The commission shall determine the
amount of electric rates to be deposited. That amount shall come
from unallocated funds previously authorized for demand management
and interruptible programs and rates which previously paid for demand
management and interruptible programs which the commission
determines to be less cost effective than the photovoltaic incentive
program established by Division 16.7 (commencing with Section 26420)
of the Public Resources Code.
SEC. 5. This act shall not be operative unless Assembly Bill 2006
of the 2003-04 Session of the Legislature is enacted.
amended to read:
303. (a) A public utilities commissioner may not hold an official
relation to, nor have a financial interest in, a person or
corporation subject to regulation by the commission. If any
commissioner voluntarily acquires a financial interest in a
corporation or person that the commissioner knows or should know is
subject to regulation by the commission, his or her office shall
immediately become vacant. If any commissioner acquires a financial
interest in a corporation or person subject to regulation by the
commission other than voluntarily, his or her office shall become
vacant unless within a reasonable time he or she divests himself or
herself of the interest.
(b) The commission shall adopt an updated Conflict of Interest
Code and Statement of Incompatible Activities, by February 28, 2004,
in a manner consistent with applicable law.
(c) For purposes of this section, "financial interest" includes
those interests enumerated in subdivisions (a) through (e),
inclusive, of Section 87103 of the Government Code.