BILL NUMBER: AB 2863 ENROLLED
BILL TEXT
PASSED THE SENATE AUGUST 21, 2008
PASSED THE ASSEMBLY AUGUST 29, 2008
AMENDED IN SENATE AUGUST 13, 2008
AMENDED IN SENATE AUGUST 4, 2008
AMENDED IN SENATE JUNE 26, 2008
AMENDED IN SENATE JUNE 16, 2008
AMENDED IN ASSEMBLY MAY 8, 2008
AMENDED IN ASSEMBLY APRIL 8, 2008
AMENDED IN ASSEMBLY MARCH 25, 2008
INTRODUCED BY Assembly Member Leno
FEBRUARY 22, 2008
An act to amend Sections 218 , 218.3, and 739.5 of, and to add
Article 3 (commencing with Section 2868) to Chapter 9 of Part 2 of
Division 1 of, the Public Utilities Code, relating to electricity.
LEGISLATIVE COUNSEL'S DIGEST
AB 2863, Leno. Independent solar energy producers: master-meter
customers.
(1) Under existing law, the Public Utilities Commission has
regulatory authority over public utilities, including electrical
corporations. An electrical corporation is defined as including every
corporation or person owning, controlling, operating, or managing
any electric plant for compensation within this state, except where
electricity is generated on or distributed by the producer through
private property solely for its own use or the use of its tenants and
not for sale or transmission to others. Existing law requires that,
when gas or electric service is provided by a master-meter customer
to users who are tenants of a mobilehome park, apartment building, or
similar residential complex, the master-meter customer charge each
user at the same rate which would be applicable if the user were
receiving gas or electricity directly from the gas or electrical
corporation. Existing law creates further requirements for
master-meter customers and for the corporations which provide service
to them.
This bill would require a master-meter customer to charge each
user a rate not to exceed the rate that would be applicable if the
user were receiving gas or electricity, or both, directly from the
gas or electrical corporation.
This bill would additionally create an exception from the
definition of an "electrical corporation" for an independent solar
energy producer, as defined.
(2) Existing law defines an "electric service provider" as an
entity that offers electrical service to customers within the service
territory of an electrical corporation, excluding electrical
corporations, local publicly owned electric utilities, and certain
cogenerators. Provisions of the existing Public Utilities Act
restructuring the electrical services industry require that electric
service providers register with the commission and provide for the
authorization of direct transactions between electric service
providers and end-use customers.
This bill would recast the existing definition and additionally
create an exception for an independent solar energy producer, as
defined.
(3) This bill would require an independent solar energy producer
contracting for the use or sale of electricity or the lease of a
solar energy system to an entity or person for use in a residence to
make certain disclosures to the buyer or lessee and to record a
Notice of an Independent Solar Energy Producer Contract and related
documents, as provided. The bill would impose specific information
requirements on independent solar energy producers. The bill would
require all contracts for the sale of electricity by an independent
solar energy producer to an entity or person for use in a residence
to be made available to the commission upon its request, and would
provide for confidentiality of those contracts except as otherwise
provided. The bill would require a master-meter customer of an
electric utility who purchases electricity or leases a solar energy
system from an independent solar energy producer, and who provides
electric service to users who are tenants of a mobilehome park,
apartment building, or similar residential complex, to charge each
user of the electric service that is under a submetered system a rate
for the solar generated electricity not to exceed the rate charged
by the independent solar energy producer or the electric utility's
rate for an equivalent amount of electricity, whichever is lower. The
bill would impose civil liability on those who violate specified
provisions in the amount of actual damages suffered by a transferee
or transferor of the real property as a consequence of that
violation.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 218 of the Public Utilities Code is amended to
read:
218. (a) "Electrical corporation" includes every corporation or
person owning, controlling, operating, or managing any electric plant
for compensation within this state, except where electricity is
generated on or distributed by the producer through private property
solely for its own use or the use of its tenants and not for sale or
transmission to others.
(b) "Electrical corporation" does not include a corporation or
person employing cogeneration technology or producing power from
other than a conventional power source for the generation of
electricity solely for any one or more of the following purposes:
(1) Its own use or the use of its tenants.
(2) The use of or sale to not more than two other corporations or
persons solely for use on the real property on which the electricity
is generated or on real property immediately adjacent thereto, unless
there is an intervening public street constituting the boundary
between the real property on which the electricity is generated and
the immediately adjacent property and one or more of the following
applies:
(A) The real property on which the electricity is generated and
the immediately adjacent real property is not under common ownership
or control, or that common ownership or control was gained solely for
purposes of sale of the electricity so generated and not for other
business purposes.
(B) The useful thermal output of the facility generating the
electricity is not used on the immediately adjacent property for
petroleum production or refining.
(C) The electricity furnished to the immediately adjacent property
is not utilized by a subsidiary or affiliate of the corporation or
person generating the electricity.
(3) Sale or transmission to an electrical corporation or state or
local public agency, but not for sale or transmission to others,
unless the corporation or person is otherwise an electrical
corporation.
(c) "Electrical corporation" does not include a corporation or
person employing landfill gas technology for the generation of
electricity for any one or more of the following purposes:
(1) Its own use or the use of not more than two of its tenants
located on the real property on which the electricity is generated.
(2) The use of or sale to not more than two other corporations or
persons solely for use on the real property on which the electricity
is generated.
(3) Sale or transmission to an electrical corporation or state or
local public agency.
(d) "Electrical corporation" does not include a corporation or
person employing digester gas technology for the generation of
electricity for any one or more of the following purposes:
(1) Its own use or the use of not more than two of its tenants
located on the real property on which the electricity is generated.
(2) The use of or sale to not more than two other corporations or
persons solely for use on the real property on which the electricity
is generated.
(3) Sale or transmission to an electrical corporation or state or
local public agency, if the sale or transmission of the electricity
service to a retail customer is provided through the transmission
system of the existing local publicly owned electric utility or
electrical corporation of that retail customer.
(e) "Electrical corporation" does not include an independent solar
energy producer, as defined in Article 3 (commencing with Section
2868) of Chapter 9 of Part 2.
(f) The amendments made to this section at the 1987 portion of the
1987-88 Regular Session of the Legislature do not apply to any
corporation or person employing cogeneration technology or producing
power from other than a conventional power source for the generation
of electricity that physically produced electricity prior to January
1, 1989, and furnished that electricity to immediately adjacent real
property for use thereon prior to January 1, 1989.
SEC. 2. Section 218.3 of the Public Utilities Code is amended to
read:
218.3. (a) "Electric service provider" means an entity that
offers electrical service to customers within the service territory
of an electrical corporation and includes the unregulated affiliates
and subsidiaries of an electrical corporation.
(b) "Electric service provider" does not include an entity that
offers electrical service solely to service customer load consistent
with subdivision (b) of Section 218, and does not include an
electrical corporation or a public agency that offers electrical
service to residential and small commercial customers within its
jurisdiction, or within the service territory of a local publicly
owned electric utility.
(c) "Electric service provider" does not include an independent
solar energy producer, as defined in Article 3 (commencing with
Section 2868) of Chapter 9 of Part 2.
SEC. 3. Section 739.5 of the Public Utilities Code is amended to
read:
739.5. (a) The commission shall require that, whenever gas or
electric service, or both, is provided by a master-meter customer to
users who are tenants of a mobilehome park, apartment building, or
similar residential complex, the master-meter customer shall charge
each user of the service at a rate not to exceed the rate that would
be applicable if the user were receiving gas or electricity, or both,
directly from the gas or electrical corporation. The commission
shall require the corporation furnishing service to the master-meter
customer to establish uniform rates for master-meter service at a
level that will provide a sufficient differential to cover the
reasonable average costs to master-meter customers of providing
submeter service, except that these costs shall not exceed the
average cost that the corporation would have incurred in providing
comparable services directly to the users of the service.
(b) Every master-meter customer of a gas or electrical corporation
subject to subdivision (a) who, on or after January 1, 1978,
receives any rebate from the corporation shall distribute to, or
credit to the account of, each current user served by the
master-meter customer that portion of the rebate which the amount of
gas or electricity, or both, consumed by the user during the last
billing period bears to the total amount furnished by the corporation
to the master-meter customer during that period.
(c) An electrical or gas corporation furnishing service to a
master-meter customer shall furnish to each user of the service
within a submetered system every public safety customer service that
it provides beyond the meter to its other residential customers. The
corporation shall furnish a list of those services to the
master-meter customer who shall post the list in a conspicuous place
accessible to all users. Every corporation shall provide these public
safety customer services to each user of electrical or gas service
under a submetered system without additional charge unless the
corporation has included the average cost of these services in the
rate differential provided to the master-meter customer on January 1,
1984, in which case the commission shall deduct the average cost of
providing these public safety customer services when approving rate
differentials for master-meter customers.
(d) Every master-meter customer is responsible for maintenance and
repair of its submeter facilities beyond the master-meter, and
nothing in this section requires an electrical or gas corporation to
make repairs to or perform maintenance on the submeter system.
(e) Every master-meter customer shall provide an itemized billing
of charges for electricity or gas, or both, to each individual user
generally in accordance with the form and content of bills of the
corporation to its residential customers, including, but not limited
to, the opening and closing readings for the meter, and the
identification of all rates and quantities attributable to each block
in the applicable rate structure. The master-meter customer shall
also post, in a conspicuous place, the applicable prevailing
residential gas or electrical rate schedule, as published by the
corporation.
(f) The commission shall require that every electrical and gas
corporation shall notify each master-meter customer of its
responsibilities to its users under this section.
(g) The commission shall accept and respond to complaints
concerning the requirements of this section through the consumer
affairs branch, in addition to any other staff that the commission
deems necessary to assist the complainant. In responding to the
complaint, the commission shall consider the role that the office of
the county sealer in the complainant's county of residence may have
in helping to resolve the complaint and, where appropriate,
coordinate with that office.
SEC. 4. Article 3 (commencing with Section 2868) is added to
Chapter 9 of Part 2 of Division 1 of the Public Utilities Code, to
read:
Article 3. Independent Solar Energy Producers
2868. The following definitions shall apply for purposes of this
article:
(a) "Electric utility" means an electrical corporation as defined
in Section 218, a local publicly owned electric utility as defined in
Section 9604, or an electrical cooperative as defined in Section
2776.
(b) "Independent solar energy producer" means a corporation or
person employing one or more solar energy systems for the generation
of electricity for any one or more of the following purposes:
(1) Its own use or the use of its tenants.
(2) The use of, or sale to, not more than two other entities or
persons per generation system solely for use on the real property on
which the electricity is generated, or on real property immediately
adjacent thereto.
(c) "Real property" means a single parcel of land.
(d) "Solar energy system" means any configuration of solar energy
devices that collects and distributes solar energy for the purpose of
generating electricity and that has a single interconnection with
the electric utility transmission or distribution network.
2869. (a) (1) An independent solar energy producer contracting
for the use or sale of electricity or the lease of a solar energy
system, to an entity or person, for use in a residence shall include
a disclosure to the buyer or lessee that, at a minimum, includes all
of the following:
(A) A good faith estimate of the kilowatthours to be delivered by
the solar energy system.
(B) A plain language explanation of the terms under which the
pricing will be calculated over the life of the contract and a good
faith estimate of the price per kilowatthour.
(C) A plain language explanation of operation and maintenance
responsibilities of the contract parties.
(D) A plain language explanation of the contract provisions
regulating the disposition or transfer of the contract in the event
of a transfer of ownership of the residence, as well as the costs or
potential costs associated with the disposition or transfer of the
contract.
(E) A plain language explanation of the disposition of the solar
energy system at the end of the term of the contract.
(2) The commission may require, as a condition of receiving
ratepayer funded incentives, that an independent solar energy
producer provide additional disclosure to the buyer or lessee, the
commission, or both.
(b) An independent solar energy producer contracting for the use
or sale of electricity or the lease of a solar energy system, to an
entity or person, for use in a residence shall record a Notice of an
Independent Solar Energy Producer Contract, within 30 days of the
signing of the contract, against the title to the real property on
which the electricity is generated, and against the title to any
adjacent real property on which the electricity will be used, in the
office of the county recorder for the county in which the real
property is located. The notice shall include all of the following
and may include additional information:
(1) (A) If the solar energy system is located on the real
property, a prominent title at the top of the document in 14-point
type stating "Notice of an Independent Solar Energy Producer Contract"
and the following statement:
"This real property is receiving part of its electric service from
an independent solar energy producer that has retained ownership of
a solar electric generation system that is located on the real
property. The independent solar energy producer provides electric
service to the current owner of this real property through a
long-term contract for electric service. The independent solar energy
producer is required to provide a copy of the contract to a
prospective buyer of the real property within ten (10) days of the
receipt of a written request from the current owner of this real
property."
(B) If the solar energy system is located on an adjacent real
property, a prominent title at the top of the document in 14-point
type stating "Notice of an Independent Solar Energy Producer Contract"
and the following statement:
"This real property is receiving part of its electric service from
an independent solar energy producer that has retained ownership of
a solar electric generation system that is located on an adjacent
real property. The independent solar energy producer provides
electric service to the current owner of this real property through a
long-term contract for electric service. The independent solar
energy producer is required to provide a copy of the contract to a
prospective buyer of this real property within ten (10) days of the
receipt of a written request from the current owner of this real
property."
(2) The address and assessor's parcel number of the real property
against which the notice is recorded.
(3) The name, address, and telephone number of the independent
solar energy producer, and any other contact information deemed
necessary by the independent solar energy producer.
(4) A statement identifying whether the contract is a contract for
the sale of electricity or for the lease of a solar energy system,
and providing the dates on which the contract commences and
terminates.
(5) A plain language summary of the potential costs, consequences,
and assignment of responsibilities, if any, that could result in the
event the contract is terminated.
(c) (1) The recorded Notice of an Independent Solar Energy
Producer Contract does not constitute a title defect, lien, or
encumbrance against the real property, and the independent solar
energy producer shall be solely responsible for the accuracy of the
information provided in the notice and for recording the document
with the county recorder.
(2) The independent solar energy producer shall record a
subsequent document extinguishing the Notice of an Independent Solar
Energy Producer Contract if the contract is voided, terminated, sold,
assigned, or transferred. If the independent solar energy producer
transfers its obligation under the contract or changes its contact
information, it shall record a new notice reflecting these changes
within 30 days of their occurrence.
(3) Within 30 days of the termination of a contract for the use or
sale of electricity or the lease of a solar energy system, the
independent solar energy producer shall record a subsequent document
extinguishing the Notice of an Independent Solar Energy Producer
Contract from the title to the real property on which the electricity
is generated, and from the title to any adjacent real property on
which the electricity was used, in the office of the county recorder
for the county in which the real property is located.
(d) An independent solar energy producer contracting for the use
or sale of electricity or the lease of a solar energy system shall
provide a copy of the existing contract to a prospective buyer of the
real property where the electricity is used or generated within ten
(10) days of the receipt of a written request from the current owner
of the real property.
(e) (1) All contracts for the sale of electricity by an
independent solar energy producer to an entity or person, for use in
a residential dwelling shall be made available to the commission upon
its request, and shall be confidential, except as provided for in
this subdivision. The disclosures required by subdivision (a) may be
made open to public inspection or made public by the commission.
(2) A contract provided to the commission pursuant to this
subdivision shall not be open to public inspection or made public,
except on order of the commission, or by the commission or a
commissioner in the course of a hearing or proceeding.
(3) This subdivision does not eliminate or modify any rule or
provision of law that provides for the confidentiality of information
submitted to the commission in the course of its proceedings.
(f) A master-meter customer of an electric utility who purchases
electricity or leases a solar energy system from an independent solar
energy producer, and who provides electric service to users who are
tenants of a mobilehome park, apartment building, or similar
residential complex, shall do both of the following:
(1) Charge each user of the electric service that is under a
submetered system a rate for the solar generated electricity not to
exceed the rate charged by the independent solar energy producer or
the electric utility's rate for an equivalent amount of electricity,
whichever is lower.
(2) Comply with the provisions of Section 739.5 or 12821.5, and
any rules set forth by an electric utility for master-meter
customers.
(g) No transfer of real property subject to this article shall be
invalidated solely because of the failure of any person to comply
with any provision of this article. Any person who willfully or
negligently violates or fails to perform any duty prescribed by any
provision of this article shall be civilly liable in the amount of
actual damages suffered by a transferee or transferor of the real
property as a consequence of that violation or failure.