BILL NUMBER: SB 1388 ENROLLED
BILL TEXT
PASSED THE SENATE AUGUST 25, 2000
PASSED THE ASSEMBLY AUGUST 21, 2000
AMENDED IN ASSEMBLY JUNE 20, 2000
AMENDED IN SENATE MAY 16, 2000
AMENDED IN SENATE MAY 4, 2000
AMENDED IN SENATE APRIL 24, 2000
AMENDED IN SENATE APRIL 12, 2000
INTRODUCED BY Senator Peace
JANUARY 24, 2000
An act to amend Sections 25519 and 25523 of, and to repeal Section
25524 of, the Public Resources Code, and to add Sections 393 and
454.1 to the Public Utilities Code, relating to public utilities.
LEGISLATIVE COUNSEL'S DIGEST
SB 1388, Peace. Electrical power facilities.
(1) The Warren-Alquist State Energy Resources Conservation and
Development Act requires the State Energy Resources Conservation and
Development Commission to certify sufficient sites and related
facilities that are required to provide a supply of electric power
sufficient to accommodate projected demand for power statewide. The
act requires that the commission forward an application for
certification of a power facility to local governmental agencies
having land use and related jurisdiction in the area of the proposed
site and related facility, and requires those local agencies to
review the application and submit comments, as prescribed. The act
requires the commission to transmit a copy of the application to each
federal and state agency having jurisdiction or special interest in
matters pertinent to the proposed site and related facilities and to
the Attorney General.
This bill would require local and state agencies having
jurisdiction or special interest in matters pertinent to the proposed
site and related facilities to provide their comments and
recommendations on the project within 180 days of the date of filing
of an application.
(2) The act requires that the commission prepare a written
decision after a public hearing on an application for certification,
containing specified information, including, with respect to a
geothermal site and related facility, findings on whether there are
sufficient commercial quantities of geothermal resources available to
operate the proposed facility for its planned life. The act
prohibits the commission from certifying any geothermal site and
related facility unless it finds that the geothermal field dedicated
to the proposed powerplant is reasonably capable of providing
geothermal resources in sufficient commercial quantities to supply
the powerplant over its planned life.
This bill would delete the above provisions relating to certifying
geothermal sites and related facilities.
(3) The Public Utilities Act requires the Public Utilities
Commission to implement specified provisions of the restructuring of
the electrical industry in the state.
This bill would require the commission to conduct a pilot study of
certain customers of each electrical corporation to determine the
relative value to ratepayers of information, rate design, and
metering innovations using specified approaches. The commission
would be required to report initial results of the study to the
Legislature on or before March 31, 2002, and results for a specified
electrical corporation 15 months after a certain rate level is no
longer in effect. The bill would require the commission and the
Electricity Oversight Board to facilitate efforts to obtain federal
authorization to recover certain expenses of electrical corporations
related to reconfiguration, replacement, or expansion of transmission
facilities. The bill would authorize the commission to periodically
review and adjust depreciation schedules and rates authorized for an
electric plant that is under the jurisdiction of the commission and
owned by electrical corporations and to periodically review and
adjust depreciation schedules and rates authorized for a gas plant
that is under the jurisdiction of the commission and owned by gas
corporations. Because a violation of the act is a crime, this bill
would impose a state-mandated local program.
(4) The bill would make legislative findings and declarations with
regard to the reliability and cost of electricity service and the
need for an electricity consumer infrastructure that will provide
electricity consumption information to customers.
(5) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares all of the
following:
(a) Reliable, reasonably priced electricity service is and always
has been essential for California's economic growth and for the
health and welfare of its citizens.
(b) To improve the reliability and cost of electricity service in
California, Chapter 854 of the Statutes of 1996 (hereafter AB 1890)
restructured the state's electricity industry to allow market-based
competition in the supply of electric power and created the
Independent System Operator to ensure reliability, efficiently
operate the statewide transmission system, and ensure that necessary
new transmission capacity was planned for and constructed.
(c) Prior to electric industry restructuring, California had
experienced a decade-long hiatus in powerplant construction that, in
conjunction with strong, population-driven electricity demand growth,
had begun to jeopardize electric system reliability.
(d) The passage of AB 1890 ended this construction hiatus and
stimulated private developers to file an unprecedented number of
applications to build new, environmentally superior merchant
powerplants in California.
(e) However, because these new powerplants will not be completed
until 2002 or 2003, the state's electric system reliability will
remain vulnerable during the next few years during periods when
California and its neighboring states simultaneously experience very
hot weather.
(f) This vulnerability will be exacerbated, in the event of a
drought, by California's dependence on rainfall-driven hydroelectric
power for over 20 percent of its annual electricity requirements.
(g) Adequate generation, transmission, and consumer-demand
responsiveness alternatives are critical to managing the
vulnerability of the state's electric system and ensuring reliable,
reasonably priced, electricity.
(h) Therefore all of the following are necessary:
(1) Timely and efficient public processes for siting, licensing,
and interconnecting new generation and transmission facilities.
(2) Providing tools and information to the state's electricity
consumers to enable them to manage their energy use during periods
when electricity is most costly.
(3) Equipping public and private institutions that protect the
interests of California's citizens with the tools and authority they
need to facilitate the timely development of required physical and
policy infrastructure.
(i) This act is intended to ensure that needed processes and
institutional capabilities are in place so California's citizens and
businesses will continue to be assured reliable, reasonably priced,
electricity service. Specifically, this bill is intended to do all
of the following:
(1) Expedite the deployment of new in-state electric generation
capacity.
(2) Expedite the development of necessary transmission capacity
identified by the Independent System Operator.
(3) Expedite the development of necessary distribution capacity
identified by the Public Utilities Commission.
(4) Maximize the potential benefits of energy conservation by
facilitating the deployment of appropriate metering and communication
and control technologies through the distribution system.
(j) The Legislature further finds and declares all of the
following:
(1) There is a need to establish an electricity consumer
information infrastructure that will provide electricity consumption
information to residential and small commercial customers to help
them better manage their electricity use and costs and improve the
demand responsiveness of the electricity market.
(2) A fundamental tool residential and small electricity consumers
require to better manage their electricity use is real-time
information about their electricity consumption. Currently, the only
electricity usage information consumers have is a monthly bill that
summarizes historical electricity consumption. Real-time electricity
usage information is required for consumers to understand the
relationship between their current activities and the amount of
electricity they are consuming. However, at present, few consumers
have technology installed to monitor their electricity consumption on
a real-time basis.
(3) Technology exists that could help consumers acquire the
real-time information they would need to understand and manage their
electricity consumption. However, the current stock of installed
electricity meters is not capable of allowing ready access to this
information.
(4) It may be possible to economically retrofit or, in certain
cases, replace the current stock of electricity meters to allow
real-time usage information to be made available to consumers through
a standard output interface. A standard output interface would
allow consumers to purchase a variety of energy information and
management technologies that would meet their individual energy
management objectives.
(5) Today, no energy information and management technologies are
commercially available to the small consumer market at a cost low
enough to encourage participation. However, the ubiquitous
availability of standard electricity usage information at a standard
output interface, along with rates that reward customers for managing
their electricity usage and costs, will provide an incentive to
customers to change their usage patterns and to third party providers
to develop value-added technological solutions to help consumers use
their electricity usage information to manage their electricity
consumption and meet their individual energy management objectives
and improve the demand responsiveness of the electricity market.
(k) The Legislature further finds and declares all of the
following:
(1) The electric facilities owned by electrical corporations that
are used in California for the transmission of electric energy at
high voltages, whether or not in interstate commerce, are facilities
essential to the well-being of California residents and businesses.
(2) It is in the public interest to reconfigure and add transfer
and replacement capacity to electric transmission facilities to
facilitate competition in electric generation markets, ensure open,
nondiscriminatory access to all buyers and sellers of electricity, to
assure all buyers and sellers of electricity that they will receive
comparable service, and to ensure continued reliability of the
transmission grid.
(3) Reasonable expenditures by electrical corporations to plan,
design, and engineer reconfigurations, replacements, or expansions of
transmission facilities are in the public interest, and are deemed
prudent if made for the purpose of facilitating competition in
electric generation markets, ensuring open access and comparable
service, or maintaining or enhancing reliability, whether or not
expenditures are for transmission facilities that become operational.
SEC. 2. Section 25519 of the Public Resources Code is amended to
read:
25519. (a) In order to obtain certification for a site and
related facility, an application for certification of the site and
related facility shall be filed with the commission. The application
shall be in a form prescribed by the commission and shall be for a
site and related facility that has been found to be acceptable by the
commission pursuant to Section 25516, or for an additional facility
at a site that has been designated a potential multiple-facility site
pursuant to Section 25514.5 and found to be acceptable pursuant to
Sections 25516 and 25516.5. An application for an additional
facility at a potential multiple-facility site shall be subject to
the conditions and review specified in Section 25520.5. An
application may not be filed for a site and related facility, if
there is no suitable alternative for the site and related facility
that was previously found to be acceptable by the commission, unless
the commission has approved the notice based on the one site as
specified in Section 25516.
(b) The commission, upon its own motion or in response to the
request of any party, may require the applicant to submit any
information, document, or data, in addition to the attachments
required by subdivision (i), that it determines is reasonably
necessary to make any decision on the application.
(c) The commission shall be the lead agency as provided in Section
21165 for all projects that require certification pursuant to this
chapter and for projects that are exempted from such certification
pursuant to Section 25541. Unless the commission's regulatory
program governing site and facility certification and related
proceedings are certified by the Resources Agency pursuant to Section
21080.5, an environmental impact report shall be completed within
one year after receipt of the application. If the commission
prepares a document or documents in the place of an environmental
impact report or negative declaration under a regulatory program
certified pursuant to Section 21080.5, any other public agency that
must make a decision that is subject to the California Environmental
Quality Act, Division 13 (commencing with Section 21000), on a site
or related facility, shall use the document or documents prepared by
the commission in the same manner as they would use an environmental
impact report or negative declaration prepared by a lead agency.
(d) If the site and related facility specified in the application
is proposed to be located in the coastal zone, the commission shall
transmit a copy of the application to the California Coastal
Commission for its review and comments.
(e) If the site and related facility specified in the application
is proposed to be located in the Suisun Marsh or the jurisdiction of
the San Francisco Bay Conservation and Development Commission, the
commission shall transmit a copy of the application to the San
Francisco Bay Conservation and Development Commission for its review
and comments.
(f) Upon receipt of an application, the commission shall forward
the application to local governmental agencies having land use and
related jurisdiction in the area of the proposed site and related
facility. Those local agencies shall review the application and
submit comments on, among other things, the design of the facility,
architectural and aesthetic features of the facility, access to
highways, landscaping and grading, public use of lands in the area of
the facility, and other appropriate aspects of the design,
construction, or operation of the proposed site and related facility.
(g) Upon receipt of an application, the commission shall cause a
summary of the application to be published in a newspaper of general
circulation in the county in which the site and related facilities,
or any part thereof, designated in the application, is proposed to be
located. The commission shall transmit a copy of the application to
each federal and state agency having jurisdiction or special
interest in matters pertinent to the proposed site and related
facilities and to the Attorney General.
(h) Local and state agencies having jurisdiction or special
interest in matters pertinent to the proposed site and related
facilities shall provide their comments and recommendations on the
project within 180 days of the date of filing of an application.
(i) The adviser shall require that adequate notice is given to the
public and that the procedures specified by this division are
complied with.
(j) For any proposed site and related facility requiring a
certificate of public convenience and necessity, the commission shall
transmit a copy of the application to the Public Utilities
Commission and request the comments and recommendations of the Public
Utilities Commission on the economic, financial, rate, system
reliability, and service implications of the proposed site and
related facility. If the commission requires modification of the
proposed facility, the commission shall consult with the Public
Utilities Commission regarding the economic, financial, rate, system
reliability, and service implications of those modifications.
(k) The commission shall transmit a copy of the application to any
governmental agency not specifically mentioned in this act, but
which it finds has any information or interest in the proposed site
and related facilities, and shall invite the comments and
recommendations of each agency. The commission shall request any
relevant laws, ordinances, or regulations that an agency has
promulgated or administered.
(l) An application for certification of any site and related
facilities shall contain a listing of every federal agency from which
any approval or authorization concerning the proposed site is
required, specifying the approvals or authorizations obtained at the
time of the application and the schedule for obtaining any approvals
or authorizations pending.
SEC. 3. Section 25523 of the Public Resources Code is amended to
read:
25523. The commission shall prepare a written decision after the
public hearing on an application, which includes all of the
following:
(a) Specific provisions relating to the manner in which the
proposed facility is to be designed, sited, and operated in order to
protect environmental quality and assure public health and safety.
(b) In the case of a site to be located in the coastal zone,
specific provisions to meet the objectives of Division 20 (commencing
with Section 30000) as may be specified in the report submitted by
the California Coastal Commission pursuant to subdivision (d) of
Section 30413, unless the commission specifically finds that the
adoption of the provisions specified in the report would result in
greater adverse effect on the environment or that the provisions
proposed in the report would not be feasible.
(c) In the case of a site to be located in the Suisun Marsh or in
the jurisdiction of the San Francisco Bay Conservation and
Development Commission, specific provisions to meet the requirements
of Division 19 (commencing with Section 29000) of this code or Title
7.2 (commencing with Section 66600) of the Government Code as may be
specified in the report submitted by the San Francisco Bay
Conservation and Development Commission pursuant to subdivision (d)
of Section 66645 of the Government Code, unless the commission
specifically finds that the adoption of the provisions specified in
the report would result in greater adverse effect on the environment
or the provisions proposed in the report would not be feasible.
(d) (1) Findings regarding the conformity of the proposed site and
related facilities with standards adopted by the commission pursuant
to Section 25216.3 and subdivision (d) of Section 25402, with public
safety standards and the applicable air and water quality standards,
and with other relevant local, regional, state, and federal
standards, ordinances, or laws. If the commission finds that there
is noncompliance with any state, local, or regional ordinance or
regulation in the application, it shall consult and meet with the
state, local, or regional governmental agency concerned to attempt to
correct or eliminate the noncompliance. If the noncompliance cannot
be corrected or eliminated, the commission shall inform the state,
local, or regional governmental agency if it makes the findings
required by Section 25525.
(2) The commission may not find that the proposed facility
conforms with applicable air quality standards pursuant to paragraph
(1) unless the applicable air pollution control district or air
quality management district certifies that complete emissions offsets
for the proposed facility have been identified and will be obtained
by the applicant prior to the commission's licensing of the project,
to the extent that the proposed facility requires emission offsets to
comply with local, regional, state, or federal air quality
standards.
(e) Provision for restoring the site as necessary to protect the
environment, if the commission denies approval of the application.
(f) In the case of a site and related facility using resource
recovery (waste-to-energy) technology, specific conditions requiring
that the facility be monitored to ensure compliance with paragraphs
(1), (2), (3), and (6) of subdivision (a) of Section 42315 of the
Health and Safety Code.
(g) In the case of a facility, other than a resource recovery
facility subject to subdivision (f), specific conditions requiring
the facility to be monitored to ensure compliance with toxic air
contaminant control measures adopted by an air pollution control
district or air quality management district pursuant to subdivision
(d) of Section 39666 or Section 41700 of the Health and Safety Code,
whether the measures were adopted before or after issuance of a
determination of compliance by the district.
SEC. 4. Section 25524 of the Public Resources Code is repealed.
SEC. 5. Section 393 is added to the Public Utilities Code, to
read:
393. (a) The commission shall conduct a pilot study of the
residential and small commercial customers of each electrical
corporation, where the rate level established in subdivision (a) of
Section 368 is no longer in effect, to determine the relative value
to ratepayers of various information, rate design, and metering
innovations for helping residential and small commercial customers
better manage their electricity use. The commission shall compare
the net benefits, including, but not limited to, all of the following
approaches:
(1) The retrofit or replacement of residential and small
commercial meters to provide real-time usage information to a
standard output interface that is connected to a visual display
module within the customer's home or business that presents
information, at minimum, on current usage and historic usage. The
commission may also test the effects of providing greater amounts of
information display capability including, but not limited to,
historic usage and estimated aggregated costs for the billing period,
associated with the customer's bundled rate structure. The standard
output interface of the meter must be multiply accessible to allow
the installation by the customer, an electrical corporation, or a
registered energy service provider of energy information-based energy
management applications.
(2) The replacement of residential and small commercial meters
with time-of-use meters that distinguish and measure peak and
off-peak energy use. Subject to the approval of the commission,
electrical corporations shall offer a rate schedule to customers that
differentially price seasonal on-peak, mid-peak, and off-peak energy
use that reflects the electrical corporation's actual energy cost.
The meters used shall have the same standard usage information output
interface as in paragraph (1).
(3) The replacement of residential and small commercial meters
with meters that facilitate the offering of hourly real-time pricing.
Subject to the approval of the commission, electrical corporations
shall offer a rate schedule to customers that prices electricity
usage at the electrical corporation's hourly cost. The meters used
shall have the same standard usage information output interface as in
paragraph (1) .
(b) The commission shall ensure that sufficient valid randomized
customer use data, normalized for weather, occupancy, energy cost
differences and other potentially confounding factors, are collected
to respond to, but are not limited to, all of the following
questions:
(1) To what extent is the real-time availability of customer usage
information to customers sufficient to bring about a significant
change in customer energy consumption behavior?
(2) To what extent is the availability of customer usage
information to customers sufficient to stimulate innovation in energy
information-based energy management applications?
(3) What is the difference in energy consumption behavior between
customers that have enhanced access to energy consumption information
and those who have time-of-use rates?
(4) Do the differences in usage and net cost savings, if any,
between customers who have enhanced energy information and those who
have time-of-use rates justify the broader offering of time-of-use
metering capability?
(5) What is the difference in energy consumption behavior between
customers who consume electricity under hourly real-time pricing and
customers who either have enhanced information access or time-of-use
pricing? Does the value of these differences justify the broader
offering of hourly real-time pricing?
(6) What issues should be addressed prior to systemwide
deployment?
(c) In conducting the pilot study, the commission shall ensure
that all of the following study conditions are observed:
(1) No more than the minimum number of customers required to
provide a statistically valid sample for a customer group in a pilot
study as required by subdivision (a) are included. The aggregate
total number of customers participating in a customer group in a
pilot study may not exceed 3 percent of the electrical corporation's
customers.
(2) Customers from each electrical corporation are selected from
comparable geographic areas, from a variety of climate zones, and
from a range of socioeconomic circumstances. In addition, control
groups of customers shall be established for each study against whom
the behavior of the study group participants may be compared.
(3) No customer is required to participate in a pilot study.
However, customer rates of participation and reasons for
nonparticipation for each study condition shall be monitored and
incorporated in the study results, as appropriate.
(4) The offerings for the customers in the service territories of
each electrical corporation that participates in a pilot study
required by subdivision (a) are identical among electrical
corporations to allow the comparison of data and results. However,
electrical corporations may test alternative technological solutions,
not including those relating to the standard usage information
output interface specified in subdivision (e), to offer hourly
real-time pricing for the pilot study in paragraph (3) of subdivision
(a).
(5) Notwithstanding paragraph (4), the commission may waive the
requirement imposed by that paragraph, or otherwise alter a pilot
study, if the commission finds that it is in the public interest.
(6) All interested energy service providers and equipment
manufacturers are included in the design and implementation of the
pilot study to ensure that its results may be used to guide the
subsequent deployment of the appropriate customer usage information
infrastructure.
(d) The commission shall report to the Legislature on the initial
results of the pilot study on or before March 31, 2002. The
commission shall report on the results of the study for electrical
corporations that continue to be under the rate level established in
subdivision (a) of Section 368 at the effective date of this act
within 15 months from the time when that rate level is no longer in
effect.
(e) The study data shall be available to the public. The data
shall be provided in a way that does not reveal customer-specific
information.
(f) The standard usage information output interface used in pilot
study elements set forth in paragraphs (1) to (3), inclusive, of
subdivision (a) shall meet all of the following specifications:
(1) All electrical corporation retrofits or meter replacements
shall conform to the same American National Standards Institute,
Institute of Electrical and Electronics Engineers or other standard,
as appropriate, and provide the same standard output interface.
(2) The technology selected shall be the most cost-effective,
including its use of electricity on a life-cycle basis.
(3) The standard output interface selected shall allow a customer'
s data to be multiply accessed in a secure and protected manner.
(4) The standard output interface shall be installed in a way that
does not compromise customer or worker safety or the integrity or
accuracy of the meter.
(5) Because some older vintage meters cannot be readily
retrofitted, the decision regarding whether to retrofit or replace a
meter must be made on the basis of cost-effectiveness.
(6) Access by electrical corporations and third-party providers to
the usage information output interface shall be at the sole
discretion of the customer, except to the extent that the customer
enters into a billing relationship with an electrical corporation or
energy service provider.
(7) To ensure customer privacy, unless specifically authorized by
the customer, information based upon customer data may not be used
for any commercial purpose.
(8) Customers receiving service under the California Alternative
Rates for Energy program under Section 739.1 do not pay a higher
distribution rate attributable to participating in any of the pilot
studies in subdivision (a).
(g) The commission shall allow electrical corporations to include
in their distribution rates the reasonable investment and operating ,
installing, accounting, and evaluating costs of the pilot studies,
those costs to be allocated only among the customer classes
participating in the study.
SEC. 6. Section 454.1 is added to the Public Utilities Code, to
read:
454.1. (a) Reasonable expenditures by transmission owners that
are electrical corporations to plan, design, and engineer
reconfiguration, replacement, or expansion of transmission facilities
are in the public interest and are deemed prudent if made for the
purpose of facilitating competition in electric generation markets,
ensuring open access and comparable service, or maintaining or
enhancing reliability, whether or not these expenditures are for
transmission facilities that become operational.
(b) The commission and the Electricity Oversight Board shall
jointly facilitate the efforts of the state's transmission owning
electrical corporations to obtain authorization from the Federal
Energy Regulatory Commission to recover reasonable expenditures made
for the purposes stated in subdivision (a).
(c) Nothing in this section alters or affects the recovery of the
reasonable costs of other electric facilities in rates pursuant to
the commission's existing ratemaking authority under this code or
pursuant to the Federal Power Act (41 Stat. 1063; 16 U.S.C. Secs.
791a, et seq.). The commission may periodically review and adjust
depreciation schedules and rates authorized for an electric plant
that is under the jurisdiction of the commission and owned by
electrical corporations and periodically review and adjust
depreciation schedules and rates authorized for a gas plant that is
under the jurisdiction of
the commission and owned by gas corporations, consistent with
this code.
SEC. 7. No reimbursement is required by this act pursuant to
Section 6 of Article XIIIB of the California Constitution because the
only costs that may be incurred by a local agency or school district
will be incurred because this act creates a new crime or infraction,
eliminates a crime or infraction, or changes the penalty for a crime
or infraction, within the meaning of Section 17556 of the Government
Code, or changes the definition of a crime within the meaning of
Section 6 of Article XIIIB of the California Constitution.