BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 515
                                                                  Page  1

          Date of Hearing:   May 11, 2005

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                   Judy Chu, Chair

                   AB 515 (Richman) - As Amended:  April 19, 2005 

          Policy Committee:                               
          UtilitiesVote:10-0
                        W.P.&W.                               13-0  
          (Consent)

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:               

           SUMMARY  

          This bill:

          1)Requires the Department of Water Resources (DWR) to establish  
            a program for private entities to lease space above the State  
            Water Project conveyance facilities for installation of solar  
            photovoltaic (PV) panels to generate electricity. 

          2)Requires DWR, upon request, to evaluate PV proposals, which  
            must include an engineering study. 

          3)Requires the costs of the engineering study and DWR's  
            evaluation to be paid by the party making a proposal. 

          4)Authorizes DWR to negotiate lease compensation that at least  
            equals the departments costs for its obligation under a lease.

           FISCAL EFFECT  

          1)Costs to DWR of about $250,000 for two positions for two years  
            to establish the program. Costs may ultimately be offset by  
            lease revenues from PV projects. 

          2)Ongoing costs would depend on the number of proposals  
            submitted for DWR review, but would probably be at least  
            $125,000 for one full-time position and related expenses. Part  
            of these costs, and any additional staffing costs, would be  
            covered by fees paid to DWR to review proposals and from lease  
            revenues.








                                                                  AB 515
                                                                  Page  2


           COMMENTS  

           1)Purpose . According to the author's office, the purpose of this  
            bill is to conserve resources and promote projects that  
            further that interest. According to the author, PV-generated  
            power correlates well with the utilities' daily load patterns  
            because the power is available when it is needed most during  
            the peak demand periods in the daylight hours. The SWP extends  
            more than 660 miles and includes 33 storage facilities, 20  
            pumping plants, 4 hydroelectric plants, and 4  
            pumping-generating plants. 

            Solar electric or PV systems convert some of the energy in  
            sunlight directly into electricity.  PV cells are made  
            primarily of silicon, the same semiconductor material used for  
            computers.  When the silicon is combined with one or more  
            materials, it exhibits unique electrical properties in the  
            presence of sunlight.  Electrons are excited by the light and  
            move through the silicon.  This is known as the PV effect and  
            results in direct current electricity.  PV modules have no  
            moving parts, and have a working life of 20-30 years. 

           2)Prior Legislation  . In 2003, AB 426 (Richman), which was  
            similar to this bill, was held on the Senate Appropriations  
            Suspense file and subsequently amended to address a different  
            subject.

           Analysis Prepared by  :    Chuck Nicol / APPR. / (916) 319-2081