BILL ANALYSIS                                                                                                                                                                                                    



                                                                  SB 1299
                                                                  Page  1

          Date of Hearing:   August 23, 2000

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS 
                              Carole Migden, Chairwoman

            SB 1299 (Energy and Utilities Committee) - As Amended:  August  
                                      18, 2000 

          Policy Committee:                              Utilities and  
          Commerce     Vote:                            12-0

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:               

           SUMMARY  

          This bill extends until January 2011 the sunset date on the  
          following two energy efficiency loan programs administered by  
          the California Energy Commission (CEC):

          1)The Energy Conservation Assistance Account (ECAA), which is  
            scheduled to sunset in January 2001.

          2)The Local Jurisdiction Account (LJA), which is scheduled to  
            sunset in January 2002.

           FISCAL EFFECT  

          No fiscal impact.  This bill continues the two loan programs,  
          which are financed (including administrative costs) solely from  
          loan repayments and interest on surplus money investments in  
          each account.

           COMMENTS  

           1)Background  .  Local governments, school districts, and special  
            districts can borrow money from the CEC for projects that pay  
            for themselves through savings in energy costs under two  
            revolving loan accounts-the ECAA and the LJA.  The ECAA  
            provides low-interest loans to schools, local governments, and  
            special districts for projects such as lighting upgrades in  
            schools.  The LJA provides low-interest loans to local  
            governments for projects such as LED traffic signals.  Under  
            both programs, the CEC provides technical assistance to  
            eligible institutions in order to assist them in identifying  








                                                                  SB 1299
                                                                  Page  2

            potential cost-effective energy efficiency opportunities.  

           2)Prior Legislation  .  This bill is similar to AB 1663, which the  
            governor vetoed in 1999.  In his veto message the governor  
            stated that "there does not appear to be a demand for energy  
            efficiency loans" and that "loans are available from  
            private-sector lenders at a lower rate of interest."  The CEC  
            reports that, since March of this year, over $9 million in  
            loans has been approved from these accounts for various school  
            projects.  About $5 million is currently available for  
            additional loans, with requests for $12 million either pending  
            or under discussion from various school districts and local  
            jurisdictions.  The CEC expects that all available funds will  
            be loaned out by the end of this year.



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