BILL NUMBER: AB 1064 AMENDED
BILL TEXT
AMENDED IN SENATE JUNE 30, 2008
AMENDED IN SENATE JUNE 10, 2008
AMENDED IN SENATE JUNE 25, 2007
AMENDED IN ASSEMBLY JUNE 1, 2007
AMENDED IN ASSEMBLY MAY 2, 2007
AMENDED IN ASSEMBLY APRIL 17, 2007
INTRODUCED BY Assembly Members Lieber and Fuentes
(Coauthor: Assembly Member DeSaulnier)
FEBRUARY 23, 2007
An act to amend Sections 224 and Section
379.6 of the Public Utilities Code, relating to energy.
LEGISLATIVE COUNSEL'S DIGEST
AB 1064, as amended, Lieber. Energy: heat corporations:
self-generation incentive program.
(1) Under existing law, the Public Utilities Commission (PUC) has
regulatory authority over public utilities, including electrical
corporations and heat corporations, as defined.
This bill would except from the definition of a heat corporation,
a person employing advanced solar thermal distributed technology, as
defined, for the production or generation of heat for its own use or
the use of its tenants or for sale to a heat corporation or state or
local public agency.
(2)
(1) Existing law requires the PUC
Public Utilities Commission (PUC) , in
consultation with the State Energy Resources Conservation and
Development Commission (Energy Commission), to administer, until
January 1, 2012, a self-generation incentive program for distributed
generation resources. The program is applicable to all eligible
technologies, as determined by the PUC and subject to certain air
emissions and efficiency standards, until January 1, 2008, except for
solar technologies, which the PUC is required to administer
separately, after January 1, 2007, pursuant to the California Solar
Initiative. Commencing January 1, 2008, until January 1, 2012,
existing law limits eligibility for nonsolar technologies to fuel
cells and wind distributed generation technologies that meet or
exceed emissions standards adopted by the State Air Resources Board.
Existing law authorizes the PUC, in administering the self-generation
incentive program, to adjust the amount of rebates and to include in
the program other ultraclean and low-emission distributed generation
technologies, as defined, and to evaluate other public policy
interests.
The California Global Warming Solutions Act of 2006 requires the
State Air Resources Board to adopt a statewide greenhouse gas
emissions limit equivalent to the statewide greenhouse gas emissions
levels in 1990, to be achieved by 2020.
This bill would extend until January 1, 2012, the self-generation
incentive program for nonsolar distributed generation resources
that applies to all eligible technologies, as determined by
the commission. The bill would make waste gas, as defined, advanced
solar thermal, fuel cell, and wind distributed generation
technologies meeting certain requirements eligible for the
self-generation incentive program for distributed generation.
and require the PUC to limit the eligibility for
incentives pursuant to the program to distributed generation
resources that the PUC determines support the state's goals for the
reduction of emissions of greenhouse gases pursuant to the California
Global Warming Solutions Act of 2006. The bill would require
that advanced solar thermal distributed technologies displace usage
of natural gas, as determined by the PUC, and would require that any
incentives authorized by the PUC be performance-based so that
incentives are earned based on the actual energy savings. The bill
would require that combined heat and power units meet certain
efficiency and emissions requirements to receive incentives. The bill
would require a customer receiving incentives for a combined heat
and power unit to adequately maintain and service the unit so that
during operation, the unit continues to meet or exceed the efficiency
and emissions requirements. The bill would delete the authorization
for the PUC to include in the self-generation incentive grant program
other ultraclean and low-emission distributed generation
technologies, and to evaluate other public policy interests. The bill
would require the commission to ensure that , beginning
January 1, 2009, no costs of the self-generation incentive program
for distributed generation resources are recovered from residential
customers.
(3)
(2) Existing law requires the PUC to
establish a program of assistance to low-income electric and gas
customers, referred to as the California Alternate Rates for Energy
or CARE program.
This bill would prohibit any costs of the self-generation
incentive program from being recovered from customers participating
in the CARE program.
(4)
(3) Existing law requires the Energy
Commission to undertake a continuing assessment of trends in the
consumption of electricity and other forms of energy and to analyze
the social, economic, and environmental consequences of those trends
and to collect from electric utilities, gas utilities, and fuel
producers and wholesalers and other sources, forecasts of future
supplies and consumption of all forms of energy. Existing law
requires the Energy Commission, beginning November 1, 2003, and every
2 years thereafter, to adopt an integrated energy policy report
which includes an assessment and forecast of system reliability and
the need for resource additions, efficiency, and conservation.
Existing law requires the Energy Commission, on or before November 1,
2008, in consultation with the PUC and the State Air Resources
Board, to evaluate the costs and benefits of providing ratepayer
subsidies for renewable and fossil fuel "ultraclean and low-emission
distributed generation," as defined, as part of the Energy Commission'
s integrated energy policy report.
This bill would require the Energy Commission, in consultation
with the PUC and the board State Air
Resources Board , on or before November 1, 2009, as part of the
next integrated energy policy report, to evaluate past costs and
benefits of providing ratepayer funded subsidies to natural gas and
fossil fuel fired distributed generation through the self-generation
incentive program and to evaluate the costs and benefits of providing
ratepayer funded subsidies for ultraclean and low-emission
distributed generation, including effects on air pollution, energy
efficiency, and the electrical transmission and distribution system,
and to include recommendations for certain program changes. The bill
would delete the above-described existing requirement that the Energy
Commission evaluate the costs and benefits of providing ratepayer
subsidies for ultraclean and low-emission distributed generation by
November 1, 2008. The bill would require the commission
PUC to provide an additional incentive of $0.50
per watt from existing program funds for the installation of
qualifying technologies that are manufactured in California by
companies that maintain their principal place of business in
California.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 224 of the Public Utilities
Code is amended to read:
224. (a) "Heat corporation" includes every corporation or person
owning, controlling, operating, or managing any heating plant for
compensation within this state, except where heat is generated on or
distributed by the producer through private property alone solely for
his own use or the use of his tenants and not for sale to others.
(b) "Heat corporation" does not include a corporation or person
employing landfill gas technology or advanced solar thermal
distributed technologies, as defined in Section 379.6, for the
production or generation of heat for its own use or the use of its
tenants or for sale to a heat corporation or state or local public
agency.
SEC. 2. SECTION 1. Section 379.6 of
the Public Utilities Code is amended to read:
379.6. (a) For purposes of this section, the following terms have
the following meanings:
(1) "Advanced solar thermal distributed technology" means a
mechanical device or system that utilizes solar thermal energy
sunlight for residential, commercial, or industrial space cooling,
process cooling, or a cooling system that includes space heating,
process heating, or hot water.
(2) "Waste gas" means any of the following:
(A) Landfill gas as defined in Section 41805.5 of the Health and
Safety Code.
(B) Wastewater digester gas.
(C) Manure digester gas and gas produced by thermodecomposition of
agricultural wastes.
(D) Natural gas that is generated as a byproduct of petroleum
production operations and is not eligible for delivery to the utility
pipeline system.
(b) (1) The commission, in consultation with the State Energy
379.6. (a) (1)
The commission, in consultation with the State Energy
Resources Conservation and Development Commission, shall
administer, until January 1, 2012, the self-generation incentive
program for distributed generation resources originally established
pursuant to Chapter 329 of the Statutes of 2000.
(2) Except as provided in paragraph (3), the extension of the
program pursuant to Chapter 894 of the Statutes of 2003, as amended
by Chapter 675 of the Statutes of 2004 and Chapter 22 of the Statutes
of 2005, shall apply to all eligible technologies, as determined by
the commission, until January 1, 2012.
(3) The commission shall administer solar electrical generation
and electrical displacement technologies, eligible pursuant to
Chapter 123 of the Statutes of 2006, separately.
(c) Eligibility for the program pursuant to paragraphs (1) and (2)
of subdivision (b) shall include eligible waste gas, advanced solar
thermal, fuel cell and wind distributed generation technologies that
meet or exceed the emissions standards required under the distributed
generation certification program requirements of Article 3
(commencing with Section 94200) of Subchapter 8 of Chapter 1 of
Division 3 of Title 17 of the California Code of Regulations.
(2) The commission shall administer solar technologies separately
pursuant to the California Solar Initiative adopted by the commission
in Decision 06-01-024.
(b) Eligibility for incentives under the program is limited to
distributed generation resources that the commission determines
support the state's goals for the reduction of emissions of
greenhouse gases pursuant to the California Global Warming Solutions
Act of 2006 (Division 25.5 (commencing with Section 38500) of the
Health and Safety Code).
(d)
(c) Eligibility for the self-generation incentive
program's level 3 incentive category shall be subject to the
following conditions:
(1) Commencing January 1, 2007, all combustion-operated
distributed generation projects using fossil fuel shall meet an
oxides of nitrogen (NOx) emissions rate standard of 0.07 pounds per
megawatthour and a minimum efficiency of 60 percent. A minimum
efficiency of 60 percent shall be measured as useful energy output
divided by fuel input. The efficiency determination shall be based on
100 percent 100-percent load.
(2) Combined heat and power units that meet the 60-percent
efficiency standard may take a credit to meet the applicable NOx
emissions standard of 0.07 pounds per megawatthour. Credit shall be
at the rate of one megawatthour for each 3.4 million British thermal
units (BTUs) of heat recovered.
(3) Combined heat and power units shall meet the greenhouse gases
emissions performance standard established by the commission for a
load-serving entity pursuant to Section 8341.
(4) The customer receiving incentives shall adequately maintain
and service the combined heat and power units so that during
operation, the system continues to meet or exceed the efficiency and
emissions standards established pursuant to paragraphs (1), (2), and
(3).
(5) Eligible waste gas technologies shall meet all of the
following conditions:
(A) Operate solely on waste gas. The commission shall require a
customer that applies for an incentive pursuant to this paragraph to
provide an affidavit or other form of proof, that specifies that the
project shall be operated solely on waste gas. Incentives awarded
pursuant to this paragraph shall be subject to refund and shall be
refunded by the recipient to the extent the project does not operate
on waste gas.
(B) Be determined by the air quality management district or air
pollution control district, in issuing a permit to operate the
project, that operation of the project will produce an onsite net air
emissions benefit compared to permitted onsite emissions if the
project does not operate. The commission shall require the customer
to secure the permit prior to receiving incentives.
(C) Meet an oxides of nitrogen (NOx) emissions rate standard of
0.07 pounds per megawatthour and a minimum efficiency of 60 percent.
A minimum efficiency of 60 percent shall be measured as useful energy
output divided by fuel input. The efficiency determination shall be
based on 100-percent load.
(6) Eligible solar thermal distributed technologies shall displace
usage of natural gas, as determined by the commission. Any incentive
authorized by the commission shall be performance based so that
incentives are earned based on the actual energy produced.
(7) Eligible combined heat and power units that meet the
60-percent efficiency standard may take a credit to meet the
applicable NOx emissions rate standard of 0.07 pounds per
megawatthour. Credit shall be at the rate of one megawatthour for
each 3.4 million British thermal units (BTUs) of heat recovered.
(e)
(d) In determining the eligibility for the
self-generation incentive program, minimum system efficiency shall be
determined either by calculating electrical and process heat
efficiency as set forth in Section 216.6, or by calculating overall
electrical efficiency.
(f)
(e) In administering the self-generation incentive
program, the commission may adjust the amount of rebates.
(g)
(f) The costs of the self-generation incentive program
adopted and implemented pursuant to this section may not be recovered
from customers participating in the California Alternate Rates for
Energy or CARE program established pursuant to Section 739.1.
(h)
(g) The commission shall ensure that beginning January
1, 2009, no costs of the self-generation incentive program for
distributed generation resources are recovered from residential
customers.
(i)
(h) On or before November 1, 2009, as part of the next
integrated energy policy report adopted pursuant to Chapter 4
(commencing with Section 25300) of Division 15 of the Public
Resources Code, the State Energy Resources Conservation and
Development Commission, in consultation with the commission and the
State Air Resources Board, shall evaluate past costs and benefits of
providing ratepayer funded subsidies to natural gas and fossil fuel
fired distributed generation through the self-generation incentive
program and evaluate the costs and benefits of providing ratepayer
funded subsidies for ultraclean and low-emission distributed
generation, as defined in Section 353.2, including effects on air
pollution, energy efficiency, and the electrical transmission and
distribution system. The evaluation shall include the costs and
benefits of the self-generation incentive program to residential and
small commercial ratepayers since the inception of the program. The
State Energy Resources Conservation and Development Commission shall
include recommendations for changes in the eligibility of
technologies and fuels under the self-generation incentive program,
and whether the level of subsidy, and the ratepayer classes from
which the subsidy is collected, should be adjusted, after considering
its conclusions on costs and benefits pursuant to this subdivision.
The evaluation shall be provided to the Legislature and the Governor.
(j)
(i) In administering the self-generation incentive
program, the commission shall provide an additional incentive of
fifty cents ($0.50) per watt from existing program funds for the
installation of qualifying technologies that are manufactured in
California by companies that have their principal place of business
in California.