BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 200
                                                                  Page  1

          Date of Hearing:   April 4, 2005

                    ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
                               Lloyd E. Levine, Chair
                  AB 200 (Leslie) - As Introduced:  January 31, 2005
           
          SUBJECT  :   Renewable energy resources: California Renewable  
          Portfolio Standard Program.

           SUMMARY  :   Modifies the manor in which an electrical corporation  
          with fewer than 60,000 customers in California that also serves  
          customers in other states must meet California's Renewable  
          Portfolio Standard (RPS). Specifically,  this bill  : 

             1)   Allows those electrical corporations to meet the  
               California RPS by using renewable power that is produced  
               outside of California provided that: 

               a)     The electricity from the renewable facility is  
                 procured on behalf of California customers and is not  
                 used to meet renewable energy requirements in other  
                 states.

               b)     The California Energy Commission (CEC) verifies that  
                 that the electricity generated by the facility is  
                 eligible to meet the annual procurement target of the  
                 California  RPS. 

             1)   Provides that the California Public Utilities Commission  
               (PUC) shall determine the annual procurement target for  
               those electrical corporations based on the percentage of  
               total kilowatt-hours sold in California. 


           EXISTING LAW  :

             1)   Creates the RPS which requires an electrical corporation  
               to increase its total procurement of renewable power from  
               eligible renewable resources by at least 1 percent per year  
               so that 20 percent of its retail sales are from eligible  
               renewable energy resources no later than December 31, 2017.  


             2)   Defines eligible renewable resource to only include  
               specified types of generation that are located within  








                                                                  AB 200
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               California, or have their first connection to the Western  
               Electricity Coordination Council transmission system within  
               California.


           FISCAL EFFECT  :   Unknown.

           COMMENTS  :   According to the author, the purpose of this bill is  
          to grant two electric utilities, PacificCorp and Sierra Pacific,  
          more flexibility in meeting the California RPS by allowing them  
          to count renewable power produced in parts of their service  
          territory outside of California toward their California RPS  
          requirements. 

          1)Who must meet the RPS  : All retail sellers of electricity in  
            California, excluding municipal utilities, are required to  
            meet the state's RPS. Retail sellers include: electric  
            corporations, Community Choice Aggregators, and Energy Service  
            Providers. 

          In addition to the three largest investor owned utilities (IOUs)  
             in California - San Diego Gas & Electric( SDG&E), Southern  
            California Edison (SCE), and Pacific Gas & Electric (PG&E) -  
            there are also a handful of electric corporations that serve a  
            small number of California customers. PacifiCorp serves  
            customers in Oregon, Washington, Wyoming, Idaho, Utah and also  
            provide service to less than 60,000 customers in Northern  
            California near the Oregon boarder. Sierra Pacific mainly  
            provides electricity to Nevada customers, but also serves some  
            Californians in the Lake Tahoe and Sierra Nevada region.  
            Because the RPS applies to all electrical corporations  
            providing service in California, Sierra Pacific and PacifiCorp  
            must meet the California RPS on the exact same terms as the  
            electrical corporation that only serve California customers. 

           2)What's  Sierra Pacific and PacifiCorp's Problem?:  In order to  
            meet the California RPS the renewable power must come from  
            renewable electricity generation within California or which is  
            first connected to California transmission grid. One of the  
            reasons Sierra Pacific and PacifiCorp serve some California  
            customers is that the geography of their service territories  
            makes it easier for their California customers to interconnect  
            with Oregon and Nevada based generation than it would be to  
            interconnect with PG&E's California based generation. If these  
            companies were to meet the current requirement that the  








                                                                  AB 200
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            renewable power come from within California, they would be  
            forced to build the needed renewable resources within a very  
            small portion of their service territory, even though  
            resources in other parts of the service territory could be  
            used to meet that load. 

          This bill takes into account Sierra Pacific and PacifiCorp's  
            dilemma by allowing them to include renewable resources that  
            are first connected to their distribution grid outside of  
            California to apply toward the California RPS as long as it is  
            used to meet part of the utilities' California load. 

           Previous Legislation  : 

          SB 1478 (Sher) in the 2003 - 2004 legislative session made  
          numerous changes to the RPS and contained the same provisions as  
          this bill. SB 1478 was vetoed by the Governor for reason  
          unrelated to these provisions. 

           REGISTERED SUPPORT / OPPOSITION  :   

           Support 
           
          PacifiCorp (Sponsor)
          Sierra Pacific Power Company (Sponsor)

           Opposition 

           None on file.
           
          Analysis Prepared by  :    Edward Randolph / U. & C. / (916)  
          319-2083