BILL ANALYSIS 1
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SENATE ENERGY, UTILITIES AND COMMUNICATIONS COMMITTEE
MARTHA M. ESCUTIA, CHAIRWOMAN
SB 1059 - Escutia/Morrow Hearing
Date: April 5, 2005 S
As Amended: April 4, 2005 FISCAL B
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DESCRIPTION
This bill authorizes the California Energy Commission (CEC) to
designate electric "transmission corridor zones" (a feasible
corridor for future construction of high-voltage transmission
lines) and requires cities and counties to incorporate
CEC-designated zones into their land-use plans.
Existing law:
1) Requires the California Public Utilities Commission (CPUC)
to certify the public convenience and necessity require a
transmission line before an investor-owned utility (IOU) may
begin construction (Certificate of Public Convenience and
Necessity, or CPCN). The CPCN process includes environmental
review of the proposed project under the California
Environmental Quality Act (CEQA). The CPCN confers eminent
domain authority for construction of the project.
2) Requires the CEC to assess electricity infrastructure
trends and issues facing California and develop and recommend
energy policies for the state to address and resolve such
issues as part of its biennial Integrated Energy Policy
Report (IEPR).
SB 1389 (Bowen), Chapter 568, Statutes of 2002
3) Requires the CEC to adopt a strategic plan for the state's
electric transmission grid by November 1, 2005 which
recommends actions required to implement investments needed
to ensure reliability, relieve congestion and meet future
growth in load and generation.
(SB 1565 (Bowen), Chapter 692, Statutes of 2004)
This bill :
1) Sets forth findings and declarations related to the need
for transmission investments and the importance of
designating corridors for future transmission lines.
2) Defines "transmission corridor zone" (TCZ) as the
geographic area necessary to accommodate the construction and
operation of one or more high-voltage electric transmission
lines (i.e. at least 200 kV), consistent with existing
adjacent land uses.
3) Authorizes the CEC to designate a TCZ on its own motion or
by application of a person who plans to construct a
high-voltage electric transmission line.
4) Requires a designated TCZ to be protective of the
environment to the extent feasible, be reflected in local
general and specific plans so as to integrate the electric
transmission needs of the state into local planning and be
wide enough to allow for alternative routes to be considered
where feasible.
5) Requires the CEC to be the lead agency for CEQA review of
all TCZs.
6) Requires the environmental impact report (EIR), or
environmental document prepared by the commission under a
certified regulatory program, to be used as a program EIR by
all cities and counties that amend their general or specific
plans to identify a designated TCZ.
7) Requires the CEC to review designated TCZs at least every
six years and, if the CEC finds a TCZ is no longer needed,
requires the CEC to rescind the designation.
8) Requires all subsequent state or local proceedings in
which a person seeks approval to build a transmission line
within a designated TCZ to use the CEC's EIR to the extent it
remains relevant to the project under review in the
determination of the reviewing agency.
9) Requires the CEC, in developing its strategic plan or
considering designation of a TCZ, to confer with cities and
counties, federal agencies and California Native American
tribes to identify suitable areas for a TCZ within their
jurisdictions.
10) Requires the CEC, to the
extent feasible, to coordinate its identification of the
long-term transmission needs of the state with the land use
plans of cities and counties, federal agencies, and tribes.
11) Prohibits the CEC from
designating a TCZ within the traditional land of a tribe
without consulting with the tribe.
12) Requires the CEC to notify
and solicit comments regarding the designation of a TCZ from
affected agencies and conduct public hearings in affected
counties.
13) Requires cities and counties
in which a designated TCZ is located to integrate the TCZ
into their general and specific plans during the next regular
plan revision, but not later than five years following
receipt of the CEC's decision.
14) Requires CEC approval for
cities and counties to permit development within a designated
TCZ.
BACKGROUND
Like the state's highway and water systems, improvements to the
electric transmission system are critical to ease existing
congestion, meet growth in demand, ensure reliable delivery of
existing resources, and accommodate delivery of new resources.
According to the CEC's 2003 IEPR, "(t)he state's bulk transmission
system needs major upgrades and improvements. The broken
transmission permitting process in the state must be fixed so that
needed transmission investments can move forward."
In spite of the recognition of the CEC and other observers that
the public would benefit from new investments in the transmission
grid, little progress has been made in implementing major
transmission improvements in many years. Electric restructuring
has complicated the question of who's responsible for transmission
planning, who should pay for transmission improvements, and who
will benefit.
The Independent System Operator (ISO) plans for and recommends
transmission projects within its control area, but the
responsibility for building lies with the transmission-owning
utilities, who must initiate projects and obtain approval from the
CPUC. A significant share of the state's transmission grid is
publicly owned and outside the jurisdiction of the ISO or the
CPUC.
In response to the fact that no state agency was charged
specifically with planning for the future of the transmission
system as a whole, SB 1565 was enacted last year to require the
CEC to develop a strategic transmission plan. The CEC has begun
to work on the issue as part of its IEPR process, although the
initial SB 1565 plan isn't due until this November.
According to the author, the state is suffering from a lack of
direction on electric transmission infrastructure.
Notwithstanding the fact that most of the state's transmission
grid is now supposed to operate as an integrated system,
responsibility for planning and permitting transmission projects
is divided between a multitude of federal, state and local
agencies, as well as private corporations, who either own or
manage pieces of the grid.
According to the CEC, continuing urban expansion within California
has increased public opposition to the siting and development of
new bulk transmission lines. Long-term planning for, and
designation of, transmission corridors would help to alleviate
this problem. As part of the SB 1565 process, the CEC will
identify and evaluate potential transmission corridors to
accommodate future siting and construction of needed transmission
lines. However, the CEC does not now have the authority to
formally designate such corridors to ensure that they will be
available when needed.
COMMENTS
1) TCZ idea originates from 2004 IEPR update recommendation.
According the CEC's recent report, there isn't a
comprehensive transmission planning process that encompasses
both the publicly and privately owned lines that make up the
state's transmission grid. The CEC report found that the
state has no formal process to plan for transmission
corridors well in advance of need (and individual project
applications) so that needed land or easements can be
acquired by utilities. The CEC report recommended
legislation to give them authority to formally designate
TCZs, which led to this bill.
The CEC anticipates that, given the designation of TCZs,
utilities will acquire rights of way for potential future
lines ahead of time, at a lesser cost. However, utilities
only spend their customers' money, so unless they have an
interest in speculative investment in real estate, they will
only do this if the CPUC assures recovery of land acquisition
costs from ratepayers. It's unclear how the CPUC would
determine the reasonableness of such expenditures without
knowing when or if a transmission line will be constructed,
so this aspect of the CEC's vision may be infeasible in
practice. It may also require a change in CPUC policy, which
currently limits utilities to hold transmission property for
future use for five years.
2) Relationship to CPUC process for approving individual
transmission projects. Just as a local zoning ordinance does
not approve specific developments, the designation of a TCZ
pursuant to this bill would not constitute approval in whole
or in part of any specific transmission project, nor would
TCZ designation substitute for any of the federal, state or
local permits required to construct a transmission line
itself. Similarly, designation of a TCZ would not give
eminent domain authority to a project proponent, or justify
condemnation of specific properties necessary to accommodate
the construction of a transmission line. Those procedures
follow an application to construct a transmission line with
the relevant permitting agencies, which is not the CEC.
3) Preemption of local land-use authority. Land use is a
state police power which, with a few exceptions, has been
delegated to cities and counties. Some examples of the state
retrieving land-use authority from locals within specified
geographical areas are the Coastal Commission, the San
Francisco Bay Conservation and Development Commission, the
Delta Protection Commission, and the Tahoe Regional Planning
Agency (created by interstate compact).
Examples of state preemption of locals by topic, rather than
geography, are state laws limiting development adjacent to
airports (Airport Land Use Commission law), seismic hazard
zones (Alquist-Priolo Act) and mineral deposits (Surface
Mining and Reclamation Act).
This bill gives the CEC authority to preempt local land use
authority via the designation of a TCZ. For this reason, the
League of California Cities opposes this bill. The League
also objects to provisions requiring cities to rely on the
CEC's EIR and incorporate the TCZ into local land-use plans
without regard to impacts on other elements of the plan.
4) Autonomy of charter cities vs. state police power. Of
California's 478 incorporated cities, 108 are "charter
cities," as opposed to "general law" cities. Charter cities
include the state's largest cities - Los Angeles, San Diego,
Fresno, San Jose, San Francisco, Oakland, Sacramento.
Under the California Constitution (Section 5 of Article XI),
charter cities are entitled to more autonomy than general law
cities. City charters adopted pursuant to the Constitution
supersede all inconsistent laws (e.g. state laws) with
respect to "municipal affairs." Thus, charter cities are
permitted to regulate "municipal affairs" without
interference from the state.
So, what's a "municipal affair" as opposed to some other
affair subject to general law? Case law has tempered charter
city autonomy by drawing a line between "municipal affairs"
and "issues of statewide concern," which are governed by
state law. (See, e.g., California Federal Savings and Loan
Association v. City of Los Angeles (1995) 11 Cal. 4th 342.)
In its findings, this bill indicates that "orderly planning
and development of needed high-voltage electric transmission
lines through the designation of transmission corridor zones
is an issue of statewide concern." (emphasis added)
5) Truncated CEQA process. This bill doesn't explicitly say
the designation of a TCZ is subject to CEQA, but it does
require the preparation of an EIR (or an environmental
document if the CEC's TCZ review process is certified as the
functional equivalent of CEQA by the Secretary for Resources)
within one year of receipt of a TCZ application. Further,
the bill requires cities and counties to use the CEC EIR as a
"program EIR" (a term defined in the CEQA guidelines, but not
in statute).
The one-year deadline for the EIR may be infeasible for a
couple reasons. First, the clock starts ticking upon receipt
of an application. This is an unwise trigger, as an initial
application could be a completely inadequate basis to begin
CEQA review. At a minimum, the clock should not start
ticking until the CEC has determined an application complete
and adequate.
Second, the myriad local, state and federal agencies with
responsibilities to contribute to the EIR process, as well
other interested parties, may not have adequate time to
participate in the CEC's review if it's abruptly ended on the
365th day after application regardless of the state of
review.
Also, it isn't clear what happens if the CEC misses the
deadline. The bill should clarify that a TCZ will not then
be deemed approved and should permit the CEC to extend the
deadline if circumstances warrant. Alternatively, the author
and the committee may wish to consider whether the deadline
should be eliminated. It seems unnecessary in light of the
fact that the CEC may be the sponsor, or at least an
enthusiastic recipient, of TCZ applications, and will likely
process them as quickly as it can.
6) Double referral. This bill has been referred to the
Senate Local Government Committee in addition to this
committee.
POSITIONS
Sponsor:
Author
Support:
California Chamber of Commerce
Sempra Energy
Oppose:
League of California Cities
Southern California Edison
Lawrence Lingbloom
SB 1059 Analysis
Hearing Date: April 5, 2005