BILL ANALYSIS
SB 1345
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Date of Hearing: June 19, 2000
ASSEMBLY COMMITTEE ON NATURAL RESOURCES
Howard Wayne, Chair
SB 1345 ( Peace) - As Amended: May 30, 2000
SENATE VOTE : 39-0
SUBJECT : California Energy Commission: grant program.
SUMMARY : This bill revises the definition of solar energy
system and implements a new grant program through the California
Energy Commission (CEC) to offset a portion of the costs of
solar energy systems and Distributed Generation (DG) systems.
EXISTING LAW :
1)Pursuant to the Federal Internal Revenue Code, provides credit
equal to 10% of the cost of energy property placed in service
during a given tax year.
2)Pursuant to the California Constitution, provides that active
solar energy systems are not assessed as "new construction"
for purposes of assessing State property tax.
3)Defines solar energy system as any solar collector, other
solar energy device or structural design feature whose primary
purpose is to provide for the collection, storage, and
distribution of solar energy for space heating or cooling, or
for water heating.
4)Requires the CEC to expand and accelerate development of
alternate sources of energy, including solar resources.
THIS BILL :
1)Revises the definition of "solar energy system" to add DG to
the definition.
2)Creates a grant program through the CEC to provide grants of
up to $750 to homebuilders or homeowners who install thermal
solar systems or specified photovoltaic solar systems in their
homes.
3)Creates a grant program through the CEC for up to $2000 to
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homebuilders or homeowners who install DG systems in their
homes.
4)Requires the Public Utilities Commission (PUC) to establish
operational and safety standards for DG systems installed
under the grant program.
FISCAL EFFECT : According to the Senate Appropriations Committee
this bill would incur costs of $250,000 in the initial year and
$400,000 in ongoing years. $1.5 million in funding for this
program has been approved in this year's budget in the Energy
Resources Programs Account.
COMMENTS :
1)Solar Water Heaters
According to the sponsors of the bill, existing law enacted by
the passage of AB 1890, Chapter 854, Statues of 1996 (Brulte)
and SB 90 Chapter 905, Statutes of 1997 (Sher) establishes
measures designed to increase the usage of photovoltaic
technologies through the Emerging Renewables program now being
administered by the CEC. However, small scale solar thermal
technologies were not addressed in these bills. This bill would
establish parallel, but smaller incentives for small-scale solar
thermal technologies used in water heating applications, with a
focus on new residential construction.
In recent years, solar water heating technologies have become
nearly cost-competitive with comparable natural gas systems.
However new homebuilders have been reluctant to include solar
water heaters in homes because new homebuyers typically do not
ask for solar systems.
SB 1345 would create incentives for the instillation of thermal
solar systems by providing grants to homebuilders or homeowners
for up to $750.00 per grant. The grant program would also allow
for photovoltaic battery pack systems to be eligible under the
grant program.
2)DG systems
In addition to thermal solar systems, AB 1890 (Brulte) also did
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not provide incentives for DG systems. Unlike solar systems, DG
systems allow the user, through a variety of means
(microgeneration, wind turbines, gas turbines, fuel cells, solar
dish stirling engines, and reciprocal internal combustion
engines) to provide short term energy that does not rely upon
traditional means of obtaining energy. Most often, DG systems
are used by facilities like hospitals, which cannot afford to be
without electricity even if the more traditional systems have a
break in service.
According to the author's office, this bill is intended to
encourage homeowners to install environmentally superior
electric systems to achieve self-reliance, thereby improving
overall system reliability and environmental quality and
reducing the need for upgrades to the public electric systems.
Like the solar thermal systems, this bill would also provide a
grant program for up to $2000 per grant to homebuilders or
homeowners who wish to install DG systems, thereby allowing
themselves to be completely self-sufficient in the event of
electricity system outages.
The DG systems eligible under this bill would be required to
meet the same emission standards as central station power
plants. In addition, the bill would require the PUC to
establish operation and safety standards for DG systems.
3) Similar Legislation
This bill is similar to SB 655 (Peace) which was vetoed by the
Governor. In his veto message the Governor noted that while he
was supportive of efforts to promote emerging solar and
distributed generation technologies, the bill did not have any
funding attached to the programs.
SB 1345 has $1.5 million in funding provided for it in this
year's budget.
REGISTERED SUPPORT / OPPOSITION :
Support
Astro Power
Aztec Solar
California Legislative Conference of the Plumbing Heating &
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Piping Industry
California Solar Industries Association (CAL SEIA)
California State Association of Electrical Workers
Clean Power Campaign
Environmental Defense Fund
Environmental Solar Design, Inc.
ESDI, Inc.
Goldline Electronic Controls (Independent Energy, Inc.)
Helicol
Horizon Industries
Independent Power Providers
Kyocera Solar, Inc.
Off Line, Independent Energy Systems
National Electric Contractors Association
Pacific Solar Company
Renewable Energy Concepts
Sacramento Municipal Utility District
San Diego Regional Energy Office
Science Applications International Corporation
Sierra Club California
Sierra Pacific
Solar Depot - Sacramento
Solar Depot - Photovoltaic Power Systems
Solar Roofs.com
Sun Utility Network
USAN
Several Individuals
Opposition
None on file.
Analysis Prepared by : Kyra Emanuels / NAT. RES. / (916)
319-2092