BILL NUMBER: AB 2705 AMENDED
BILL TEXT
AMENDED IN SENATE AUGUST 8, 2000
AMENDED IN ASSEMBLY APRIL 4, 2000
INTRODUCED BY Committee on Agriculture (Cardoza (Chair), Maldonado
(Vice Chair), Briggs, Florez, House, Reyes, Thomson, and Wiggins)
FEBRUARY 25, 2000
An act to add Chapter 7.5 (commencing with Section 25650) to
Division 15 of , and to repeal Section 25615 of, the Public
Resources Code, relating to energy assistance and technology
.
LEGISLATIVE COUNSEL'S DIGEST
AB 2705, as amended, Committee on Agriculture. Agricultural
industry energy program.
Under existing law, there is a loan program to assist low-income
fishing fleet operators reduce their energy costs and conserve fuel
by providing low-interest loans to those operators. Prior acts have
also appropriated federal oil overcharge funds in the Petroleum
Violation Escrow Account to the State Energy Resources Conservation
and Development Commission for a farm energy assistance program.
This bill would require funds from loan repayments and interest on
loans made by the commission pursuant to an agriculture energy
assistance program to be deposited in the Energy Technologies
Research, Development, and Demonstration Account, and upon
appropriation, to be available for loans and technical assistance.
The bill would provide that the loans have a repayment period of not
more than 7 years, and bear interest at a rate not less than 2% below
the rate earned by moneys in the Pooled Money Investment Account.
Existing law establishes a state program managed by the Department
of Food and Agriculture and the commission to assist in the
development of solar technology in agriculture.
This bill would repeal that provision.
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. Chapter 7.5 (commencing with Section 25650) is added to
Division 15 of the Public Resources Code, to read:
CHAPTER 7.5. AGRICULTURAL INDUSTRY ENERGY PROGRAM
25650. (a) All funds from loan repayments and interest that
become due and payable for loans made by the commission pursuant to
an agriculture energy assistance program shall be deposited in the
Energy Technologies Research, Development, and Demonstration Account,
and shall be available for loans and technical assistance pursuant
to this section, upon appropriation in the Budget Act. Up to 20
percent of the annual appropriation shall be available for technical
assistance.
(b) Loans made pursuant to this section shall be for the purchase
of equipment and services for agriculture energy efficiency and
development demonstration projects, including, but not limited to,
production of methane or ethanol, use of wind, photovoltaics, and
other sources of energy for irrigation pumping, application of load
management conservation techniques, improvements in water pumping and
pressurization techniques, and conservation tillage techniques.
(c) The loans shall contain terms providing for a repayment period
of not more than seven years and for interest at a rate that is not
less than 2 percent below the rate earned by moneys in the Pooled
Money Investment Account.
SEC. 2. Section 25615 of the Public Resources Code is repealed.
25615. (a) The Legislature hereby finds and declares that, during
the last 50 years, inexpensive fossil fuels and electricity have
created significant technological changes in the production of
agricultural products. Fossil fuels have been substituted for labor,
animal power, wind energy and solar energy technology in food and
feed production and in the processing of California's agricultural
commodities. Although the availability of inexpensive energy has
fostered an intensive system of agriculture with higher crop yields
and excellent productivity, our reliance on cheap energy has made the
producers of agricultural products vulnerable to supply
interruptions and skyrocketing price escalations.
(b) The Legislature further finds that the agricultural industry
and consumers are faced with a challenge to maintain and even enhance
the productivity of California agriculture through the development
of renewable energy resources.
(c) The Legislature further finds that enhanced energy efficiency
and conservation and development of renewable resource energy
technologies are needed to replace and conserve fossil fuels and
electricity in the production and processing of agricultural
products. To develop such potential, a state program for assisting
the development of solar technology in agriculture is necessary.
(d) The program, managed by the Department of Food and Agriculture
in cooperation with the commission, shall include, but not be
limited to, the following:
(1) An assessment of potential solar energy projects in California
agriculture.
(2) Cooperation with the University of California in its ongoing
extension program to provide information to ranchers, farmers and
food processors on the benefits of renewable resource technologies to
agricultural processes and on the availability of financial
incentives such as loans and tax credits. The department may
contract with the university or other educational institutions or
agricultural organizations for such information outreach services.
(3) Establishment of an energy conservation, renewable resource,
and solar energy technologies assistance program in agriculture
utilizing the resources and joint efforts of persons engaged in
agriculture, food processors, cooperatives, and manufacturers and
installers of solar and other energy conservation and renewable
resource energy technologies, the university and colleges, and the
government to demonstrate the effectiveness and economic viability of
energy conservation and renewable resource energy technologies in
agriculture. The assistance program shall include state financial
incentives to encourage the rapid and widespread deployment of
diverse energy conservation and renewable resource energy
technologies in agriculture and food processing. State financial
incentives may include, but shall not be limited to, state loans,
loan guarantees, and leases and participating agreements for
individuals, businesses, and public agencies for the purpose of
stimulating the development and use of energy conservation and
renewable resource energy technologies in agriculture. Energy
conservation, solar applications, and renewable resource energy
technologies eligible to receive state financial assistance shall
include, but not be limited to, the following:
(A) Solar energy for space and water heating and cooling and for
process heat.
(B) Wind energy for pumping and electrical generation of less than
100 kilowatts installed capacity.
(C) Geothermal energy for direct heating and cooling applications.
(D) Installation of hydroelectric generators of less than 100
kilowatts installed capacity on existing water storage and conveyance
facilities such as dams, pipelines, and canals associated with
agricultural water use.
(E) Energy conservation technologies and associated equipment
which have promising application and life cycle cost effectiveness in
the agricultural sector. Such technologies shall include, but not
be limited to:
(i) Technologies that reduce heating, cooling, and refrigeration
energy use.
(ii) Technologies that conserve water if their application will
reduce energy use in water pumping.
(iii) Installation of more efficient electric motors for pumping,
refrigeration, and other agricultural uses.
(e) The Department of Food and Agriculture, in cooperation with
the commission and the University of California, shall assist
applicants in attempting to obtain all possible supplementary and
complimentary assistance from other publicly or privately funded
sources prior to authorizing any state assistance.
(f) The Department of Food and Agriculture shall establish a
technical review committee for the purpose of evaluating applications
for financial assistance under this chapter. The department shall
make awards of state financial assistance according to the decisions
of the technical review committee. The members of the technical
review committee shall consist of the following:
(1) One representative of the Department of Food and Agriculture
appointed by the Director of Food and Agriculture.
(2) One representative of the commission appointed by the chairman
of the commission.
(3) One representative of an agricultural organization appointed
by the Director of Food and Agriculture.
(4) One representative of the University of California appointed
by the president of the university.
(5) One public member with background and experience in
agriculture appointed by the Director of Food and Agriculture.
(g) The Department of Food and Agriculture, after consultation
with the technical review committee, shall establish criteria for the
approval of applications for state financial assistance under this
chapter. Such criteria shall include, but not be limited to, the
following:
(1) Criteria requiring projects approved for financial assistance
to be cost effective and establishing a method of determination of
cost effectiveness.
(2) Criteria providing reasonable assurance of an applicant's
ability to repay loans financed or guaranteed.
(3) Criteria concerning the terms and conditions of loans. The
interest rate on loans made pursuant to this chapter shall not be
less than 6 percent per year.
(4) Criteria establishing a maximum percentage of state-provided
financial assistance for any project. In no case shall state
financial assistance provide more than 90 percent of the total
project cost.
(5) Criteria which will ensure that numerous conservation and
renewable resource technologies are included in the program, and that
concentration on one or two technologies is avoided.
(6) Criteria for the approval of equipment financed under the
program. Such criteria may include requirements for equipment and
installation warranties.
(7) Requirements that cost effective energy conservation measures
be implemented in conjunction with renewable resource technologies.
(h) The Renewable Resource Energy Agricultural Account is hereby
created in the General Fund. All moneys in such account shall be
available for allocation by the Department of Food and Agriculture
for the purposes of this section without regard to fiscal year when
appropriated therefor by the Legislature. All moneys repaid pursuant
to the provisions of this chapter shall be deposited in such account
and shall thereupon become available for allocation for the purposes
of this section when appropriated therefor by the Legislature.
Funds expended in any calendar year by the department from the
account for administering the provisions of this chapter shall not
exceed 5 percent of the total amount of financial assistance provided
to applicants in that year.