BILL ANALYSIS                                                                                                                                                                                                    



                                                                    SB 1298
                                                                    Page  1

          SENATE THIRD READING
          SB 1298 (Bowen)
          As Amended August 25, 2000
          Majority vote 

           SENATE VOTE  :Vote not relevant  
           
           NATURAL RESOURCES   11-0        UTILITIES AND COMMERCE    7-0   
           
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          |Ayes:|Wayne, Aanestad,          |Ayes:|Wright, Pescetti,         |
          |     |Dickerson, Jackson,       |     |Calderon, Briggs, Cox,    |
          |     |Keeley, Lowenthal,        |     |Maddox, Mazzoni           |
          |     |Machado, Migden, Oller,   |     |                          |
          |     |Robert Pacheco, Steinberg |     |                          |
          |-----+--------------------------+-----+--------------------------|
          |     |                          |     |                          |
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           APPROPRIATIONS      21-0                                        
           
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          |Ayes:|Migden, Campbell,         |     |                          |
          |     |Ackerman, Alquist,        |     |                          |
          |     |Aroner, Ashburn, Brewer,  |     |                          |
          |     |Cedillo, Corbett, Davis,  |     |                          |
          |     |Kuehl, Maldonado, Papan,  |     |                          |
          |     |Romero, Runner, Shelley,  |     |                          |
          |     |Thomson, Wesson, Wiggins, |     |                          |
          |     |Wright, Zettel            |     |                          |
          |-----+--------------------------+-----+--------------------------|
          |     |                          |     |                          |
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          SUMMARY  :  Requires the State Air Resource Board (ARB) to adopt  
          emissions standards for distributed generation technologies  
          determined to have significant potential for market penetration  
          in the state.  Specifically,  this bill:   

          1)Requires ARB, on or before January 1, 2003, to adopt a  
            certification program and uniform emissions standards for  
            electrical generation technologies that are exempt from  
            district permitting requirements.

          2)Requires the emissions standards for the above-exempted  
            electrical generation technologies to reflect the best  
            performance achieved in practice by existing electrical  








                                                                    SB 1298
                                                                    Page  2

            generation technologies.

          3)Requires, commencing on January 1, 2003, all electrical  
            generation technologies to be certified by the state board or  
            permitted by an air district prior to use or operation in the  
            state.

          4)Prohibits an air district from authorizing the siting or  
            operation of any electrical generation technology for which  
            state emission standards exist unless that technology complies  
            with the applicable standards.

          5)Authorizes an air district to establish emissions standards  
            regarding distributed generation technology more stringent  
            than those established by ARB.

          6)Authorizes ARB to establish a fee schedule to be assessed  
            against persons seeking certification as a distributed  
            generator.

          7)Requires ARB, on or before January 1, 2003, to issue guidance  
            to air districts on the permitting or certification of  
            electrical generation technologies under the air districts'  
            regulatory jurisdiction.  The guidance shall address best  
            available control technology determinations for electrical  
            generation technologies and, by the earliest practicable date,  
            make those equivalent to the level determined by ARB to be the  
            best available control technology for permitted central  
            station powerplants in California.  The guidance shall also  
            address permit streamlining and the potential for  
            precertification of one or more types of electrical generation  
            technologies.

           FISCAL EFFECT  :  According to the Appropriations Committee  
          analysis, there will be moderate costs, about $300,000 primarily  
          in fiscal year (FY) 2001-2002, to ARB to adopt regulations for  
          the emission standards and the certification program.  These  
          costs would eventually be reimbursed by revenue generated from  
          fees ARB is authorized to impose on distributed generators  
          certification once the program is put in place.  There will also  
          be moderate costs, about $500,000 annually starting in FY  
          2002-2003, to ARB to administer the certification program.   
          These costs are also potentially covered by fee revenue.  (Air  
          Pollution Control Fund.)









                                                                    SB 1298
                                                                    Page  3

           COMMENTS  :  "Distributed generation" is defined in this bill as  
          "electrical generation located near the place of use."  Examples  
          of distributed generation include large cogeneration facilities,  
          located adjacent to a hospital, providing all electricity  
          demands or those required during a power failure, as well as a  
          simple solar array atop a residential home, used for various  
          home electrical demands.

          The author's office states that while distributed generation  
          technologies are likely to play an important role in supplying  
          power to the state in the future, the application of existing  
          air quality standards to them is either unclear or insufficient.  
           This bill would charge the appropriate enforcement agency with  
          establishing these standards in as proactive a manner as  
          possible.

           
          Analysis Prepared by  :  Scott H. Valor / NAT. RES. / (916)  
          319-2092 



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