BILL ANALYSIS ------------------------------------------------------------ |SENATE RULES COMMITTEE | SB 1298| |Office of Senate Floor Analyses | | |1020 N Street, Suite 524 | | |(916) 445-6614 Fax: (916) | | |327-4478 | | ------------------------------------------------------------ UNFINISHED BUSINESS Bill No: SB 1298 Author: Bowen (D) and Peace (D) Amended: 8/25/00 Vote: 21 SENATE VOTES NOT RELEVANT ASSEMBLY FLOOR : 77-0, 8/29/00 - See last page for vote SUBJECT : Air emissions: distributed generation SOURCE : Author DIGEST : This bill requires the State Air Resource Board (ARB) to adopt emissions standards for distributed generation technologies exhibiting growth potential in the California energy marketplace. Assembly Amendments delete the prior version. As it left the Senate, the bill was authored by the Senate Energy Committee and provided $14 million from the Petroleum Violation Escrow Account for energy conservation projects. ANALYSIS : Existing law: 1. Requires the ARB to establish emissions standards for stationary sources of air pollution, including refineries and power plants. 2. Requires the ARB to establish the best available control technology (BACT) as a means by which sources of air CONTINUED SB 1298 Page 2 pollution can comply with air emissions standards. The BACT standard is not a recommendation for a particular pollution control device. Rather, it is a recognition of limits achievable by currently available and economically viable pollution control devices. This bill requires 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 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 SB 1298 Page 3 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 power plants in California. The guidance shall also address permit streamlining and the potential for precertification of one or more types of electrical generation technologies. Comments "Distributed generation" is defined in this bill as "electrical generation located near the place of use." Examples of distributed generation include large co-generation 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. FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes Local: Yes 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.) ASSEMBLY FLOOR : SB 1298 Page 4 AYES: Aanestad, Ackerman, Alquist, Aroner, Ashburn, Baldwin, Bates, Battin, Baugh, Bock, Brewer, Briggs, Calderon, Campbell, Cardenas, Cardoza, Cedillo, Corbett, Correa, Cox, Cunneen, Davis, Dickerson, Ducheny, Dutra, Firebaugh, Florez, Gallegos, Granlund, Havice, Honda, House, Jackson, Kaloogian, Keeley, Knox, Kuehl, Leach, Lempert, Leonard, Longville, Lowenthal, Machado, Maddox, Maldonado, Margett, Mazzoni, McClintock, Migden, Nakano, Olberg, Oller, Robert Pacheco, Rod Pacheco, Papan, Pescetti, Reyes, Romero, Runner, Scott, Shelley, Steinberg, Strickland, Strom-Martin, Thompson, Thomson, Torlakson, Villaraigosa, Vincent, Washington, Wayne, Wesson, Wiggins, Wildman, Wright, Zettel, Hertzberg NC:sl 8/30/00 Senate Floor Analyses SUPPORT/OPPOSITION: NONE RECEIVED **** END ****