BILL ANALYSIS
SB 655
Page 1
SENATE THIRD READING
SB 655 (Peace)
As Amended August 16, 1999
Majority vote
SENATE VOTE : 28-9
UTILITIES AND COMMERCE 12-0
APPROPRIATIONS 21-0
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|Ayes:|Wright, Pescetti, |Ayes:|Migden, Brewer, Ackerman, |
| |Calderon, Campbell, | |Ashburn, Campbell, |
| |Cardenas, Frusetta, | |Cedillo, Davis, |
| |Maddox, Mazzoni, Thomson, | |Hertzberg, Kuehl, |
| |Reyes, Vincent, Wesson | |Maldonado, Papan, Romero, |
| | | |Runner, Shelley, |
| | | |Steinberg, Thomson, |
| | | |Wesson, Wiggins, Wright, |
| | | |Zettel, Aroner |
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SUMMARY : Requires the California Energy Commission (CEC) to
develop a five-year program to provide grants to offset a
portion of the costs of qualified solar and distributed
generation installations, contingent on funding of the program
in the Budget Act of 2000. Specifically, this bill :
1)Requires CEC, to the extent funds are appropriated for that
purpose in the Budget Act of 2000, to develop grant programs
that provide:
a) Up to $750 grants for solar energy systems that produce
energy for water heating or electricity generation; and,
b) Up to $2,000 grants for distributed generation systems.
2)Requires CEC to adopt guidelines, as specified.
3)Revises definition of "solar energy system" to include any
solar collector or other solar energy device, or any
structural design feature of a building, whose primary purpose
is to provide for electricity generation.
4)Defines distributed generation, for the purposes of this bill,
as "any onsite generation, interconnected and operating in
SB 655
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parallel with the electricity grid, that is used solely to
meet onsite electric load."
5)Requires the California Public Utilities Commission (CPUC) to
establish operational and safety standards for distributed
generation systems, and fair and reasonable standby rates.
6)Authorizes CEC to use up to 3% of the funds appropriated for
the program to fund CEC's costs in administering these
programs.
7)Makes related finding and declarations.
EXISTING LAW :
1)Requires CEC to expand and accelerate development of
alternative sources of energy, including solar resources.
2)Defines "solar energy system" to mean any solar collector or
other solar energy device, or structural design feature of a
building, whose primary purpose is to provide for the
collection, storage, and distribution of solar energy for
space heating or cooling, or for water heating.
FISCAL EFFECT :
1)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 CPUC.
COMMENTS : This bill is designed to encourage installation of
residential, small commercial and industrial solar and
distributed generation systems. Solar systems would be eligible
for up to $750 dollars and distributed generation systems would
be eligible for 10% of their costs up to $2,000.
AB 1890 (Brulte), Chapter 854, Statutes of 1996, provided $540
million, collected over a four year period, to operate and
develop new, emerging, and existing renewable resource
technologies. AB 1890 directed CEC to develop a spending plan
for these funds. SB 90 (Sher), Chapter 905, Statutes of 1997,
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codified CEC's proposals. The Chapter 905 monies are awarded
according to the number of kilowatt hours produced, not on a
per-system basis. Under Chapter 905, the grid-connected
photovoltaic segment of the solar industry, which is eligible
for grants under this bill, is eligible to compete for 10% of
the $540 million, in the category earmarked for new and emerging
technologies. The solar water heating segment of the solar
industry, which produces no kilowatt hours, is not eligible to
compete for Chapter 905 funding because no kilowatt hours are
produced, but is eligible for grants under this bill.
Distributed generation is small scale production of electricity
at or near the point of use, as opposed to central generation,
where electricity is produced in large quantities at a remote
site and transferred to multiple users. Distributed generation
systems range from photovoltaics and fuel cells to gas turbines
and diesel engines in residential, commercial, and industrial
applications. Under this bill, distributed generation systems
are required to be used only to meet onsite electric load, and
not sell power.
This bill requires CPUC to establish appropriate interconnection
and safety requirements, and operating agreements for
distributed generation. CPUC is presently studying the issue of
distributed generation. Last December, CPUC opened a rulemaking
proceeding to consider reforms in the structure and regulatory
framework governing electricity distribution service, which
includes a study of issues related to distributed generation.
Analysis Prepared by : Joseph Lyons / U. & C. / (916) 319-2083
FN: 0003196