BILL ANALYSIS
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|SENATE RULES COMMITTEE | SB 703|
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THIRD READING
Bill No: SB 703
Author: Florez (D), et al
Amended: 7/16/03
Vote: 21
SENATE ENERGY, U.&C. COMMITTEE : 5-1, 7/8/03
AYES: Bowen, Alarcon, Dunn, Murray, Vasconcellos
NOES: McClintock
ABSENT/NO VOTE RECORDED: Morrow, Battin, Sher
SUBJECT : Electricity rates: agricultural irrigation
pumps
SOURCE : Author
DIGEST : This bill declares the intent of the Legislature
to establish cost-effective agricultural and water pumping
electricity rate schedules that are competitive with diesel
rates to prevent additional conversions of agricultural
irrigation pumps to diesel-driven engines.
ANALYSIS : Irrigation pumps and certain other
agricultural equipment can be operated by either diesel
engines or electric motors. Based on current diesel prices
and investor-owned utility (IOU) electricity rates, the
operating costs of an electric pump is significantly higher
(probably 50-100 percent) than the operating costs of a
diesel pump. Equipment costs vary widely and pending air
quality permitting requirements will make operating diesel
pumps more expensive.
CONTINUED
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According the State Air Resources Board, there are over
8,200 diesel irrigation pumps in the state, which emit
almost 44 tons per day of oxides of nitrogen (NOx) during
the high-ozone summer season. Most of these pumps are
located in the Central Valley and are responsible for about
16 percent of stationary source NOx emissions in the
valley.
Although diesel pumps and other diesel agricultural
equipment are a significant contributor to severe Central
Valley air pollution from NOx and particulate matter
emissions, agricultural equipment is exempt under state law
from the air quality permitting requirements that apply to
other stationary sources. This exemption has been found to
be a violation of the federal Clean Air Act pursuant to a
settlement of a lawsuit against the U.S. Environmental
Protection Agency. The Clean Air Act violation exposes the
state to federal enforcement and significant financial
sanctions. SB 700 (Florez), pending in the Assembly,
addresses this by repealing the exemption for agricultural
equipment and requiring air districts to require operating
permits for agricultural equipment no later than July 1,
2004.
This bill finds that a significant number of agricultural
equipment, including irrigation pumps and wind machines,
have been converted from electrical motors to diesel-driven
engines because of rising electricity rates. The bill
finds that diesel-driven equipment exacerbates air quality
and public health problems and the reduction of emissions
from such equipment through conversion to electricity and
ultra-clean and low-emission technologies is in the public
interest.
The bill states that it is the policy of the state and of
the State Public Utilities Commission to encourage
alternatives to diesel through the development of long-term
rate structures that are competitive.
This bill declares the intent of the Legislature to
establish cost-effective agricultural and water pumping
electricity rate schedules that are competitive with diesel
rates to prevent additional conversions of agricultural
irrigation pumps, and to provide an incentive to convert
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3
diesel-driven irrigation pumps back to electrical motors.
The bill states legislative intent that any discounts are
to be financed by the beneficiaries of the air quality
improvements, to avoid shifting costs to nonbeneficiaries.
FISCAL EFFECT : Appropriation: No Fiscal Com.: No
Local: No
SUPPORT : (Verified 8/18/03)
Agricultural Energy Consumers Association
California Air Pollution Control Officers' Association
California Citrus Mutual
California Cotton Ginners and Growers Associations
California Farm Bureau Federation
Fresno County Farm Bureau
Monterey Bay Unified Air Pollution Control District
San Joaquin Valley Air Pollution Control District
Sunkist Growers
WM Bolthouse Farms, Inc.
NC:cm 8/19/03 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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