BILL NUMBER: SB 431	AMENDED
	BILL TEXT

	AMENDED IN SENATE  APRIL 11, 2005

INTRODUCED BY   Senator Battin

                        FEBRUARY 17, 2005

   An act to add Section 390.2 to the Public Utilities Code, relating
to electricity.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 431, as amended, Battin.  Electricity: repowering of
facilities.
   Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including electrical corporations.
Existing law provides that subject to applicable contractual terms,
energy prices paid to nonutility power generators by an electrical
corporation based on the commission's "short run avoided cost energy
methodology" are required to be determined by specified law. Existing
law authorizes any nonutility power generator using renewable fuels
that entered into a contract with an electrical corporation
specifying fixed energy prices for electrical output prior to
December 31, 2001, to negotiate an additional 5 years of fixed energy
payments at a level to be determined by the commission.
   This bill would require the commission to develop and implement a
program to foster the repowering of existing facilities for the
generation of electricity from renewable energy resources by 
April   May  1, 2006, that imposes specified
requirements on electrical corporations in connection with their
contractual relations with owners of those facilities.
   Under existing law, a violation of the Public Utilities Act or an
order or direction of the commission is a crime.
   The provisions of this bill would be part of the act and an order
or other action of the commission would be required to implement its
provisions. Because a violation of the bill's provisions or of an
order or decision of the commission would be a crime, this bill would
impose a state-mandated local program by creating new crimes.

  The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 390.2 is added to the  Public Utilities Code ,
to read:
   390.2.  To foster the repowering of existing facilities for the
generation of electricity from renewable energy resources, the
commission shall, by  April   May  1, 2006,
develop and implement a program that includes all of the following:

   (a) Require an electrical corporation to offer the owner or owners
of an existing facility for the generation of electricity from an
eligible renewable energy resource, as defined in Section 399.12,
that desire to repower the facility either of the following
contractual options:
   (1) An amendment to the current contract for electricity generated
by the facility that includes terms and conditions that encourage
repowering   and that in all material respects, are neither
more nor less favorable than those terms that exist under the
commission's generic standard offer contracts.   . 

   (2) A new or replacement contract for electricity generated by the
facility that includes terms and conditions that encourage
repowering   and that, in all material respects, are neither
more nor less favorable than those terms that exist under the
commission's generic standard offer contracts.   . 

   (b) Requires an electrical corporation to allow the owner or
owners of an existing facility for the generation of electricity from
an eligible renewable energy resource, an option to extend the term
of an existing contract to purchase electricity generated by the
facility for up to 10 years, except that the extended term of the
amended contract may not exceed  15   20 
years from the commercial operation date of the repowered equipment.

   (c) Requires an electrical corporation to employ reasonable
flexibility in the interpretation of existing contract terms to
maximize repowering, including the allowance of reasonable
adjustments to project size and location.
   (d) Requires an electrical corporation to offer pricing options to
an owner or owners of an existing facility for the generation of
electricity from an eligible renewable energy resource to encourage
repowering, including commission-determined fixed prices based upon
either a forecast of short-run avoided costs, or another benchmark
determined by the commission to be more just and reasonable, or
resulting from a competitive bid  , and taking into account
any added value that results from paying lower prices for electricity
than the electrical corporation is currently paying for the
historical deliveries under the existing contract.  
that will result in lower prices for electricity charged to
ratepayers relative to the then‑current standard offer contract
terms. 
  SEC. 2.
  No reimbursement is required by this act pursuant to Section 6 of
Article XIII B of the California Constitution because the only costs
that may be incurred by a local agency or school district will be
incurred because this act creates a new crime or infraction,
eliminates a crime or infraction, or changes the penalty for a crime
or infraction, within the meaning of Section 17556 of the Government
Code, or changes the definition of a crime within the meaning of
Section 6 of Article XIII B of the California Constitution.