BILL NUMBER: SBX1 29	INTRODUCED
	BILL TEXT


INTRODUCED BY   Senators Steinberg and Pavley

                        AUGUST 29, 2011

   An act to add Article 3 (commencing with Section 25620.20) to
Chapter 7.1 of Division 15 of the Public Resources Code, relating to
energy.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 29, as introduced, Steinberg. Energy: energy efficiency
programs.
   (1) Under the Public Utilities Act (the act), the Public Utilities
Commission (PUC) has regulatory authority over public utilities,
including electrical corporations, as defined. The Reliable Electric
Service Investments Act within the act requires the PUC to require an
electrical corporation, until January 1, 2012, to identify a
separate electrical rate component, which the PUC refers to as the
"public goods charge," to fund energy efficiency, renewable energy,
and research, development, and demonstration programs that enhance
system reliability and provide in-state benefits.
   Existing law requires the PUC to order certain electrical
corporations to collect and spend certain funds for public benefit
programs, including cost-effective energy efficiency and conservation
programs.
   This bill would require the PUC to fund mechanisms to finance
comprehensive energy efficiency retrofits of specified building
sectors.
   (2) The California Constitution authorizes the Governor to declare
a fiscal emergency and to call the Legislature into special session
for that purpose. Governor Schwarzenegger issued a proclamation
declaring a fiscal emergency, and calling a special session for this
purpose, on December 6, 2010. Governor Brown issued a proclamation on
January 20, 2011, declaring and reaffirming that a fiscal emergency
exists and stating that his proclamation supersedes the earlier
proclamation for purposes of that constitutional provision.
   This bill would state that it addresses the fiscal emergency
declared and reaffirmed by the Governor by proclamation issued on
January 20, 2011, pursuant to the California Constitution.
   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.  Article 3 (commencing with Section 25620.20) is added
to Chapter 7.1 of Division 7.1 of the Public Resources Code, to read:


      Article 3.  Investment in Energy Efficiency Retrofits


   25620.20.  (a) The Public Utilities Commission shall implement the
following elements and principles for the state's investments in
energy efficiency retrofits pursuant to this article and Section
399.4 of the Public Utilities Code.
   (b) The Public Utilities Commission, in evaluating energy
efficiency investments under its existing statutory authority, shall
do all of the following:
   (1) Maximize in-state job development.
   (2) Create and expand financing mechanisms that produce long-term
benefits and that can become self-sustaining over time.
   (3) Ensure that moneys collected by an electrical corporation are
not expended to provide incentives to customers outside of the
service territory of the electrical corporation.
   (c) Funds collected pursuant to Section 399.8 of the Public
Utilities Code and allocated to energy efficiency programs,
consistent with subparagraph (C) of paragraph (9) of subdivision (b)
of Section 454.5 of the Public Utilities Code shall be used to invest
in and leverage resources for energy efficiency retrofits. The funds
used pursuant to this section shall be targeted to do any of the
following:
   (1) Achieve the goals in subparagraph (C) of paragraph (9) of
subdivision (b) of Section 454.5 of the Public Utilities Code, the
scoping plan adopted pursuant to Section 38561 of the Health and
Safety Code, Chapter 470 of the Statutes of 2009, Chapter 496 of the
Statutes of 2010, the Public Utilities Commission's energy efficiency
goals and policies, and other state energy and water efficiency
policies.
   (2) Maximize energy savings, job creation, and economic
development by establishing financing mechanisms that leverage funds
provided pursuant to this chapter to the maximum extent feasible,
encourage significant private investments in energy efficiency,
operate in coordination with other energy efficiency and clean energy
programs, and seek to achieve lasting market transformation and
sustainability.
   (3) Provide financial assistance for comprehensive energy
efficiency retrofits consistent with guidelines adopted pursuant to
Chapter 470 of the Statutes of 2009 and in a manner that leverages
ratepayer funds to the maximum extent feasible and is cost effective
to increase investment in energy efficiency where appropriate in a
manner that will ensure that the investments produce energy savings.
   (4) Ensure opportunities for low- and moderate-income households,
including multifamily households, and economically disadvantaged
communities to participate in financial investment tools for
comprehensive energy efficiency retrofits, and include preferences
for programs and program providers in economically disadvantaged
communities in coordination with those services made available
pursuant to Sections 739 and 2790 of the Public Utilities Code.
   (5) Coordinate with low-income energy efficiency and
weatherization programs, including those administered by other state
and local agencies and community-based organizations, to maximize the
effectiveness and efficiency of both programs.
   (6) Increase participation in energy efficiency financing and
implementation by independent third-party efficiency services
providers, including, but not limited to, local and regional
government energy offices, nonprofit organizations, community
organizations such as conservation corps and youth corps, small
businesses, and minority-, women-, and disabled veteran-owned
businesses.
   (7) Coordinate with the CEIP to ensure that proven new
technologies are integrated into program implementation.
   (8) Require independent evaluation, measurement, and verification
consistent with requirements established pursuant to Chapter 470 of
the Statutes of 2009 prior to implementation.
   (9) Improve coordination among federal, state, local, and private
programs to mobilize investment in energy efficiency and efficiency
retrofits, and eliminate duplication.
   (d) The Public Utilities Commission shall develop or authorize
financing mechanisms subject to subdivision (a) that are appropriate
to individual market segments in coordination with the commission.
   (e) The Public Utilities Commission shall establish a standard for
what constitutes cost-effective energy efficiency retrofits to
ensure that the benefits of energy efficiency retrofits exceed their
cost.
   (f) The Public Utilities Commission shall ensure that the state's
investments in cost-effective energy efficiency retrofits are
accountable and transparent by doing each of the following:
   (1) Make data publicly available in a manner that provides
sufficient information to ascertain the total program costs and
benefits, typical installed cost of energy efficiency measures where
appropriate, the amount of expected energy savings over the life of
the retrofit measure or program compared to the incentive and other
expenditures incurred, the geographic distribution of projects where
appropriate, the type of measures deployed in each electrical
corporation's service area, and the performance of energy efficiency
measures for the utility service area individually or collectively as
appropriate.
   (2) Verify energy demand reductions by region and assess progress
toward energy efficiency goals, ensure that consumer information is
made publicly available to assist customers in finding reliable
contractors and energy efficiency measures, to understand the cost
and benefits of energy efficiency measures, to understand their
energy bills, and to understand the costs and benefits of various
means of financing energy efficiency measures.
   (3) Make all contract bidding opportunities publicly available,
including contracts administered by electrical corporations or
third-party administrators, and ensure that small businesses and
minority-, women-, and disabled veteran-owned businesses are afforded
full opportunities to participate during the contract bidding
process.
   (4) Ensure that major products of all consultant contracts of the
Public Utilities Commission are made available in a timely manner on
the Public Utilities Commission's Internet Web site.
   (g) The Public Utilities Commission shall, in coordination with
the commission and pursuant to Chapter 470 of the Statutes of 2009,
adopt measurable goals and performance standards for each building
sector and financing mechanism. Financial assistance shall be limited
to no more than the amount necessary to finance energy efficiency
improvements without exceeding the value of the savings over the life
of the energy efficiency improvements. The Public Utilities
Commission shall adopt performance-based standards for financial
investment tools to ensure that recipients are provided accurate
information regarding the costs and benefits of the financial
assistance.
   (h) The Public Utilities Commission shall convene a stakeholder
advisory committee no fewer than two times annually to provide
technical and strategic guidance for the development and
administration of energy efficiency financing programs developed
pursuant to this section. The committee shall include representatives
of the investor-owned utilities, the commission, energy efficiency
investors, technology companies, building industry, installers, local
governments, commercial real estate industry, labor, diverse
environmental groups, including environmental justice groups,
commercial building owners and managers, the office of the Treasurer,
the California Public Employees' Retirement System, and other
entities, as appropriate.
   (i) The Public Utilities Commission shall authorize funding in a
manner that provides opportunities for all customer sectors to
participate, including, but not limited to, residential single family
and multifamily, commercial and small business, agriculture and food
processing, public buildings owned by state or local governments or
special assessment and school districts, and industrial entities.
   (1) In developing and expanding financial investment tools for
energy efficiency retrofits in commercial buildings, the Public
Utilities Commission should consider the unique challenges related to
energy retrofits in commercial buildings, including length of
payback, access to capital, allocation of costs between tenants and
owners, and related issues. Programs and methods that should be
considered include, but are not limited to, revolving loans,
low-interest loans, loan-loss reserves, loan guarantees, interest
rate buy-down, property-secured financing, on-bill financing or
repayment, grants, use of the California Infrastructure and Economic
Development Bank, the California Alternative Energy Transportation
Financing Authority, or other appropriate financing mechanisms.
   (2) The Public Utilities Commission shall analyze and determine
the most effective means to increase cost-effective investment in
residential energy efficiency retrofits, including local and
regional, public and private, financing mechanisms to reduce the cost
of capital and leverage public funds to the maximum extent
practicable. This evaluation shall be used to prioritize the adoption
of financial investment tools for residential energy efficiency
retrofits pursuant to Section 399.8 of the Public Utilities Code and
other provisions as appropriate. This evaluation shall consider
revolving loans, low-interest loans, loan-loss reserves, loan
guarantees, interest rate buy-down, property-secured financing,
on-bill financing or repayment, grants, use of the California
Infrastructure and Economic Development Bank, the California
Alternative Energy Transportation Financing Authority, or other
appropriate financing mechanisms.
   (3) The Public Utilities Commission shall evaluate and authorize
funding mechanisms to finance comprehensive energy efficiency
retrofits of public buildings. This evaluation shall be used to
prioritize the adoption of financial investment tools for public
building energy efficiency retrofits pursuant to Section 399.8 of the
Public Utilities Code and other provisions as appropriate. This
evaluation shall consider financial investment tools such as on-bill
financing and repayment, loan-loss reserves, regional municipal
financing programs, revolving loan funds, performance guarantees, use
of the California Infrastructure and Economic Development Bank, and
other measures that leverage funds provided pursuant to this article
to the maximum extent possible.
   (j) The Public Utilities Commission shall encourage local
government participation in, and administration of, public building
retrofit financing programs. For purposes of this subdivision, local
governments include local and regional energy offices, joint powers
authorities, special assessment districts, local government councils
and associations, and other local government entities. The Public
Utilities Commission shall coordinate with the office of the
Treasurer, the commission, electrical corporations, and local
governments to identify the most appropriate and suitable local and
regional government administrators.
   (k) Funds collected pursuant to Section 399.8 of the Public
Utilities Code and allocated for energy efficiency that are subject
to the requirements of this section shall be supervised by the Public
Utilities Commission.
  SEC. 2.  This act addresses the fiscal emergency declared and
reaffirmed by the Governor by proclamation on January 20, 2011,
pursuant to subdivision (f) of Section 10 of Article IV of the
California Constitution.