BILL NUMBER: SB 769 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY JULY 1, 2005
AMENDED IN ASSEMBLY JUNE 22, 2005
AMENDED IN SENATE MAY 2, 2005
AMENDED IN SENATE APRIL 11, 2005
INTRODUCED BY Senator Simitian
FEBRUARY 22, 2005
An act to amend and repeal Section 399.4 of, and to add
Section 382.5 to and repeal Section 382.5 of ,
the Public Utilities Code, relating to energy resources.
LEGISLATIVE COUNSEL'S DIGEST
SB 769, as amended, Simitian. Energy Reliability and
Affordability Act: energy-efficient refrigerators.
(1) Under existing law, the Public Utilities Commission has
regulatory authority over public utilities, including electrical
corporations. Under the Public Utilities Act, the commission requires
electrical corporations to identify a separate rate component to
fund programs that enhance system reliability and provide in-state
benefits. The funds are collected to support cost-effective energy
efficiency and conservation activities, public interest research and
development not adequately provided by competitive and regulated
markets, and renewable energy resources.
Existing law requires the commission, in evaluating energy
efficiency investments under its existing statutory authorities, to
ensure that no energy efficiency funds are used to provide incentives
for the purchase of new energy-efficient refrigerators.
This bill would delete that refrigerator purchase restriction and
would, instead, establish the Energy Reliability and Affordability
Act until January 1, 2012 , which would
become operative on July 1, 2006 , to increase energy
reliability and affordability by reducing the demand for energy by
ratepayers residing in low-income residential rental units. The goal
of the program would be to expand existing refrigerator replacement
programs by replacing a minimum of 50,000
20,000 energy inefficient refrigerators, as defined, in
low-income residential rental units each year over the 5-year
life of the program . The bill would require the
commission to evaluate the targeted number of refrigerators to be
replaced through the program in consideration of certain factors, and
to establish a refrigerator replacement program to, among other
things, provide incentives to owners of low-income rental residential
units with energy-inefficient refrigerators to replace those
refrigerators with more energy-efficient models. The bill would
require the commission to adopt guidelines and regulations to
implement the act. Because a violation of those guidelines or
regulations would be a crime under existing law, this bill would
impose a state-mandated local program by creating new crimes.
The bill would require the commission to annually prepare and
submit to the Legislature a report containing specified information
about the effectiveness of the program, as specified.
The bill would make the Energy Reliability and Affordability Act
provisions inoperative on July 1, 2011, and would repeal the act as
of January 1, 2012.
(2) 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 382.5 is added to the Public Utilities Code, to
read:
382.5.
(a) This section shall be known, and may be cited, as the Energy
Reliability and Affordability Act. The purpose of the act is to
increase energy reliability and affordability by reducing the demand
for energy by residential customers in low-income residential rental
units.
(b) The Legislature finds and declares all of the following:
(1) In California, refrigerators consume more energy than any
other household appliance and consume more energy than any other
residential use besides lighting.
(2) Replacing energy-inefficient refrigerators in low-income
residential rental units will greatly benefit all ratepayers by
reducing overall energy demand and reducing California Alternate
Rates for Energy (CARE) program expenditures.
(3) Replacing energy-inefficient refrigerators in low-income
residential rental units will further benefit those ratepayers by
directly reducing their energy bills.
(4) Reducing energy consumption will reduce air pollution, thus
improving public health and the environment and reducing health care
costs. Reducing air pollution will increase the quality of life for
all Californians.
(5) The average first use lifespan of a refrigerator is 19 years,
and the average age of the refrigerator fleet in California is 11
years.
(6) Federal standards for refrigerators have greatly increased the
energy efficiency of new models over the past decade.
(7) The United States Department of Energy and the United States
Environmental Protection Agency established the Energy Star program
in 1992 to identify and promote energy-efficient products to reduce
greenhouse gas emissions. Energy Star qualified refrigerators use at
least 15 percent less energy than required by current federal energy
efficiency standards, and 40 percent less energy than the
conventional models sold in 2001. New Energy Star certified
refrigerators require about half as much energy as models
manufactured before 1993.
(8) Owners of low-income residential rental housing units have no
incentive to replace older, energy-inefficient refrigerators because
renters, rather than the owners, typically are the responsible party
for the payment of energy bills incurred in those rental units.
(9) In the service territories of California's electrical
corporations, approximately two million households have a combined
household income equivalent to, or less than, 175 percent of the
federal poverty level.
(c) As used in this section, the following terms have the
following meanings:
(1) "Certified appliance recycler" means a person or entity
engaged in the business of removing and properly managing materials
that require special handling from discarded major appliances, and
who is certified pursuant to Section 25211.4 of the Health and Safety
Code. "Certified appliance recycler" does not include a person
described in subdivision (b) of Section 25211.2 of the Health and
Safety Code.
(2) "Energy efficient refrigerators" means those refrigerator
models that meet the most current United States Department of Energy
efficiency standard, and that have also received the Energy Star
certification.
(3) "Energy-inefficient refrigerators" means those models that do
not meet the most current United States Department of Energy
efficiency standard.
(4) "Energy Star" means those models of refrigerators that are
certified through the United States Department of Energy/United
States Environmental Protection Agency Energy Star program.
(5) "Low income" means those individuals and households who
qualify for assistance under the low-income energy efficiency program
guidelines established by the commission.
(6) "Low-income energy efficiency" or "LIEE" programs means the
energy efficiency and expenditure reducing programs for low-income
electricity ratepayers established pursuant to Section 382.
(7) "Owner of a low-income residential rental unit" means the
owner of record of any property occupied by a low-income individual
or household for residential purposes.
(d) (1) The goal of the program established
pursuant to this section is to expand existing refrigerator
replacement programs by replacing a minimum of 50,000
, starting July 1, 2006, by replacing a
minimum of 20,000 energy-inefficient refrigerators in
low-income residential rental units each year, for a total of
100,000 new refrigerators over the five year life of the program,
in addition to those refrigerators targeted for replacement
through the current LIEE program. These refrigerators shall be
replaced consistent with the guidelines for the LIEE program
established pursuant to Section 382.
(2) If, in any year, the goal of replacing 20,000
energy-inefficient refrigerators in low-income residential rental
units is not met, the goal in the following year shall be increased
by the unmet amount, so that the goal of replacing 100,000
energy-inefficient refrigerators in low-income residential rental
units is met by June 30, 2011.
(e) The commission shall evaluate the targeted number of
refrigerators to be replaced through the Energy Reliability and
Affordability Act, concurrent with energy efficiency potential
assessments, and may adjust upward the targeted number of
refrigerators to be replaced through evaluations of CARE program
expenditures avoided, bill defaults avoided, other cost avoidance
benefits, the cost effectiveness of reducing overall energy demand,
and the cost effectiveness of reducing the energy bills of low-income
ratepayers and other factors the commission determines are material.
The refrigerator program adopted by the commission pursuant to this
act shall do all of the following:
(1) Provide sufficient incentives to owners of low-income
residential rental units with energy-inefficient refrigerators to
replace those refrigerators with energy-efficient models.
(2) Require that incentives are only made available to owners of
low-income residential rental units upon proof of purchase of the
energy-efficient refrigerator and proof that the inefficient
refrigerator is in the control of a certified appliance recycler.
(3) Require that all replaced inefficient refrigerators are
operating condition.
(4) Require that all replacement refrigerators are
energy-efficient refrigerators.
(5) Prohibit any inefficient refrigerator replaced as part of this
program from being refurbished or reused.
(6) Require the recycling of all recyclable components of all
replaced inefficient refrigerators and the capture and proper
management of chlorofluorocarbons, oils, and other materials harmful
to human health and to the environment.
(7) Prioritize the replacement of the least efficient
refrigerators consistent with the existing low-income energy
efficiency refrigerator replacement program guidelines.
(f) The commission shall adopt guidelines and regulations to
accomplish the purposes of this section.
(g) The commission shall consider cost effectiveness when adopting
guidelines or regulations for the program, but shall give higher
priority to reducing the energy costs borne by persons who can least
afford high energy bills.
(h) The commission may administer the program under the guidelines
for an electrical or gas corporation to perform home weatherization
services for low-income customers adopted pursuant to Section 2790,
or pursuant to the guidelines and regulations adopted pursuant to
subdivision (f).
(i) The commission shall annually prepare and submit to the
Legislature a report, which may be included in the assessment
required in Section 382, incorporating all of the following
information:
(1) The number of rental units in which refrigerators have been
replaced pursuant to this section.
(2) The average age of the refrigerators replaced pursuant to this
section.
(3) An estimate of the remaining number of eligible rental units
that are in need of refrigerator replacement in the service
territories of the electrical corporations.
(4) An estimate of the energy savings per participating household.
(5) An estimate of the energy savings for the program as a whole.
(6) A diagram indicating the general areas where refrigerator
replacements have occurred and areas targeted for future refrigerator
replacement.
(7) An assessment of the administrative and programmatic costs of
the program designed pursuant to this section.
(8) An estimate of the CARE program funds saved as a result of the
program.
(9) A description of any recommended program modifications for the
following fiscal year.
(j) This section shall remain in effect only until January 1, 2012,
and as of that date is repealed, unless a later enacted statute,
that is enacted before January 1, 2012, deletes or extends that date.
(j) This section shall become inoperative on July 1, 2011, and, as
of January 1, 2012, is repealed, unless a later enacted statute that
is enacted before January 1, 2012, deletes or extends the dates on
which it becomes inoperative and is repealed.
SEC. 2. Section 399.4 of the Public Utilities Code, as added by
Section 4 of Chapter 1050 of the Statutes of 2000, is amended to
read:
399.4.
(a) (1) In order to ensure that prudent investments in energy
efficiency continue to be made that produce cost-effective energy
savings, reduce customer demand, and contribute to the safe and
reliable operation of the electric distribution grid, it is the
policy of this state and the intent of the Legislature that the
commission shall continue to administer cost-effective energy
efficiency programs authorized pursuant to existing statutory
authority.
(2) As used in this section, the term "energy efficiency"
includes, but is not limited to, cost-effective activities to achieve
peak load reduction that improve end-use efficiency, lower customers'
bills, and reduce system needs.
(b) The commission, in evaluating energy efficiency investments
under its existing statutory authorities, shall also ensure that
local and regional interests, multifamily dwellings, and energy
service industry capabilities are incorporated into program portfolio
design and that local governments, community-based organizations,
and energy efficiency service providers are encouraged to participate
in program implementation where appropriate.
SEC. 3. Section 399.4 of the Public Utilities Code, as added by
Section 4 of Chapter 1051 of the Statutes of 2000, is repealed.
SEC. 4.
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.