BILL ANALYSIS
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THIRD READING
Bill No: AB 1362
Author: Levine (D)
Amended: 7/12/05 in Senate
Vote: 21
SENATE ENERGY, U.&C. COMMITTEE : 7-3, 6/30/05
AYES: Escutia, Alarcon, Bowen, Dunn, Kehoe, Murray,
Simitian
NOES: Morrow, Battin, Cox
NO VOTE RECORDED: Campbell
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 50-29, 6/01/05 - See last page for vote
SUBJECT : Renewable energy
SOURCE : Author
DIGEST : This bill accelerates the California Renewables
Portfolio Standard (RPS) to require retail sellers of
electricity to procure at least 20 percent of their retail
sales from renewable power by 2010 instead of 2017. This
bill only becomes operative if SB 107 (Simitian) is enacted
by January 1, 2006.
ANALYSIS :
Existing Law
CONTINUED
AB 1362
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1.Requires each investor-owned utility (IOU) to increase
its existing level of renewable resources by one percent
of sales per year until renewable resources account for
20 percent of its generation portfolio, provided
sufficient Public Goods Charge (PGC) funds are available
to cover any above-market costs. (AB 57 [Wright],
Chapter 835, Statutes of 2002)
2.The RPS requires IOUs and certain other retail sellers to
meet essentially the same renewable procurement goals as
AB 57, but sets a deadline of 2017 for achieving a 20
percent renewable portfolio and establishes a detailed
process and standards for renewable procurement, as
follows:
A. IOUs and other retail sellers must buy renewable
electricity from eligible resources to meet their RPS
obligations. Buying unbundled renewable energy
credits (RECs) rather than electricity won't satisfy
RPS obligations.
B. To be eligible, renewable resources must be
located in or delivered to California. Delivery to a
retail seller or the Independent System Operator is
required, but there is no explicit requirement for
delivery to the purchasing retail seller.
C. Local publicly-owned electric utilities are not
subject to the same detailed process and standards as
IOUs, but are required to implement and enforce their
own RPS programs. (SB 1078 [Sher], Chapter 516,
Statutes of 2002)
This bill:
1.Advances the deadline for achieving a 20 percent RPS from
2017 to 2010.
2.Conforms legislative intent language to this target.
3.Provides that the bill becomes operative only if SB 107
(Simitian) is enacted by January 1, 2006.
Related Legislation
AB 1362
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SB 107 (Simitian) also advances the 20 percent RPS deadline
from 2017 to 2010 and contains other related provisions.
The bill is currently in the Senate Appropriations
Committee.
Background
The RPS requires IOUs and certain other retail energy
providers, collectively referred to as "retail sellers," to
buy renewable electricity to the extent PGC funds are
available to pay for any costs exceeding a market price set
by the PUC.
Each IOU is required to increase its renewable procurement
each year by at least one percent of total sales, so that
20 percent of its sales are renewable energy sources by
December 31, 2017. Once a 20 percent portfolio is
achieved, no further increase is required. The PUC is
required to adopt comparable requirements for direct access
energy service providers and community choice aggregators.
The RPS requires the PUC to adopt processes for determining
market prices, ranking renewable bids according to cost and
fit, flexible compliance rules and standard contract terms.
The RPS requires IOUs to offer contracts of at least 10
years, unless the PUC approves shorter contracts. This is
intended to support the development of new renewable
resources.
The "Energy Action Plan" adopted by the PUC, the CEC and
the California Power Authority pledges that the agencies
will accelerate RPS implementation to meet the 20 percent
goal by 2010, instead of 2017. In his statements on
energy, the Governor has endorsed "20 percent by 2010" and
proposed an additional goal of 33 percent by 2020.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
SUPPORT : (Verified 8/17/05)
American Federation of State, County and Municipal
Employees
AB 1362
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East Bay Municipal Utility District
Pacific Gas and Electric Company
Sempra Energy
Southern California Edison
The Utility Reform Network
ASSEMBLY FLOOR :
AYES: Arambula, Baca, Bass, Berg, Bermudez, Blakeslee,
Calderon, Canciamilla, Chan, Chavez, Chu, Cohn, Coto, De
La Torre, Dymally, Evans, Frommer, Goldberg, Hancock,
Jerome Horton, Shirley Horton, Jones, Karnette, Klehs,
Koretz, Laird, Leno, Levine, Lieber, Liu, Matthews,
Montanez, Mullin, Nation, Nava, Negrete McLeod, Oropeza,
Parra, Pavley, Richman, Ridley-Thomas, Ruskin, Saldana,
Salinas, Torrico, Umberg, Vargas, Wolk, Yee, Nunez
NOES: Aghazarian, Benoit, Bogh, Cogdill, Daucher, DeVore,
Emmerson, Garcia, Harman, Haynes, Houston, Huff, Keene,
La Malfa, La Suer, Leslie, Maze, McCarthy, Mountjoy,
Nakanishi, Niello, Plescia, Sharon Runner, Spitzer,
Strickland, Tran, Villines, Walters, Wyland
NO VOTE RECORDED: Gordon
NC:cm 8/17/05 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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