BILL ANALYSIS                                                                                                                                                                                                    



                                                          SB 655
                                                          Page  1

Date of Hearing:   August 18, 1999

              ASSEMBLY COMMITTEE ON APPROPRIATIONS 
                    Carole Migden, Chairwoman

          SB 655 (Peace) - As Amended: August 16, 1999 

Policy Committee:                              Utilities and  
Commerce     Vote:                             12-0 (Consent)

Urgency:     No                   State Mandated Local  
Program:NoReimbursable:            

  SUMMARY :

This bill: 

1)Requires the California Energy Commission (CEC) to develop  
  grant programs that provide:

   a)   Up to $750 grants for solar energy systems that produce  
     energy for water heating or electricity generation.

   b)   Up to $2,000 grants for distributed generation systems.

2)Requires the CEC to implement the grant programs, which would  
  be authorized through January 2005, to the extent that funds  
  are appropriated in the annual Budget Act.

3)Requires the Public Utilities Commission (PUC) to establish  
  operational and safety standards for distributed generation  
  systems.

  FISCAL EFFECT  :

1)The CEC estimates a one-time cost of $180,000 for consultant  
  contracts to develop performance standards for the various  
  distributed generation technologies.

2)Development and administration of the grant programs will cost  
  up to $250,000 annually for three staff positions.

3)Minor absorbable costs to the PUC.

  COMMENTS  :








                                                          SB 655
                                                          Page  2


1)  Purpose  . This bill is designed to encourage installation of  
  residential, small commercial and industrial solar and  
  distributed generation systems. This bill is also intended to  
  encourage end-users to install environmentally superior  
  generation systems to meet onsite loads, thus improving both  
  system reliability and environmental quality by reducing  
  system load and reducing the need for new distribution system  
  investments. 

2)  Background  . Distributed generation is small scale production  
  of electricity at or near the point of use. Distributed  
  generation systems range from photovoltaics and fuel cells to  
  gas turbines and diesel engines in residential, commercial,  
  and industrial applications.



  Analysis Prepared by  :    Chuck Nicol / APPR. / (916)319-2081