BILL ANALYSIS                                                                                                                                                                                                    



                                                                  SB 816
                                                                  Page  1

          Date of Hearing:   June 29, 2005

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                                   Judy Chu, Chair

                    SB 816 (Kehoe) - As Amended:  April 13, 2005 

          Policy Committee:                               
          UtilitiesVote:10-0

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:               

           SUMMARY  

          This bill makes the San Diego Gas and Electric Company's  
          (SDG&E's) net energy metering tariff available to customer  
          generators up to a total capacity, within the company's service  
          territory, of 50 megawatts instead of 0.5% of peak demand.

           FISCAL EFFECT  

          Negligible fiscal impact.

           COMMENTS  


           1)Background  . SB 656 (Alquist), Statutes of 1995, required all  
            electric utilities to buy back any electricity generated by a  
            customer-owned solar or wind system. This buy-back is known as  
            "net metering" because the electricity purchases of the  
            customer are netted against the electricity generated by the  
            customer's solar or wind electric system. The total amount of  
            capacity that could be net metered was capped at 0.1% of the  
            utility load. AB 58 (Keeley), Statutes of 2002, in part  
            increased the cap to 0.5% of utility load.


           2)Purpose  . According to the author's office, SDG&E is the only  
            IOU close to meeting the existing net metering cap. According  
            to SDG&E, it had 8.7 MW of installed net metering capacity as  
            of August 2004 and another 4 MW in process-a total of 12.7 MW,  
            or about two-thirds of the 0.5 percent cap. By in essence  
            tripling the current SDG&E cap (to 50 MW), SB 816 will give  
            SDG&E several years of net metering expansion.








                                                                  SB 816
                                                                  Page  2



           3)Related Legislation  . SB 1 (Murray) and AB 1547 (Levine), which  
            establish programs to subsidize the installation of solar  
            energy systems on residential housing units, increase the net  
            metering cap statewide.


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