BILL ANALYSIS
SB 1622
Page 1
Date of Hearing: August 7, 2000
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Roderick D. Wright, Chair
SB 1622 (Alarcon) - As Amended: June 15, 2000
SENATE VOTE : 23-9
SUBJECT : State Energy Resources Conservation and Development
Commission (CEC): environmental justice.
SUMMARY : Requires CEC to incorporate environmental justice
concepts into its overall mission and power plant siting
process, and adopt regulations relating to data requirements for
power plant applicants. Specifically, this bill :
1)Requires CEC, in consultation with the Governor's Office of
Planning and Research (OPR) and the California Environmental
Protection Agency (Cal-EPA) to develop and adopt an
environmental justice mission statement for CEC, on or before
July 1, 2001.
2)Requires CEC, in developing this mission statement, to
consider all applicable federal guidance relating to
environmental justice and, to the extent available to CEC, the
review of federal guidance conducted by OPR.
3)Requires CEC to adopt regulations, on or before January 1,
2002, to ensure that each application contains sufficient
information to address environmental justice issues in a
manner consistent with the environmental justice mission
statement developed and adopted pursuant to these provisions.
EXISTING LAW :
1)Requires Cal-EPA to meet certain requirements relating to
environmental justice, and to develop a model environmental
justice mission statement for boards, departments, and offices
within the agency, by January 1, 2001.
2)Requires OPR to be the coordinating agency for environmental
justice programs and requires the OPR director to carry out
certain related responsibilities.
3)Under the Warren-Alquist State Energy Resources Conservation
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and Development Act, establishes CEC with various energy
responsibilities, including planning and forecasting, research
and development, and power facility and site certification.
4)Grants CEC exclusive authority to certify power plants and
authorizes CEC to override other state, local, or regional
decisions and certify a power plant it determines is required
for "public convenience and necessity."
5)Permits CEC to use a certified regulatory program in lieu of
the California Environmental Quality Act (CEQA) in its power
plant siting process.
6)Requires CEC to prepare a written decision after a public
hearing on an application for certification, which contains
specified information and findings.
7)Requires that an application for certification of a power
facility submitted to CEC contain specified information that
CEC may require by regulation.
8)Requires the Secretary of the Resources Agency on or before
January 1, 2001, to review CEC's power plant siting process to
determine if it meets specified criteria for state regulatory
programs under CEQA. If the Secretary determines the
regulatory program meets those criteria, he or she is required
to continue the certification of the program.
9)Requires CEC to prepare a report to the Governor and
Legislature by March 31, 2000 that identifies administrative
and statutory measures that would improve CEC's power plant
siting and licensing process while preserving environmental
protections. The report shall include recommendations for
administrative and statutory measures for improving the siting
and licensing process.
FISCAL EFFECT : Unknown.
COMMENTS :
1)Environmental Justice . In recent years, there has been a
growing awareness that certain environmental hazards-such as
air pollution and proximity to hazardous waste facilities-are
disproportionately located among minority and low-income
populations. In 1992, the United States EPA (US-EPA) issued a
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report, "Environmental Equity: Reducing Risk for All
Communities," which found that "communities of color and
low-income populations experience higher than average
exposures to selected air pollutants, hazardous waste
facilities, and other forms of environmental pollution." In
1994, President Clinton signed Executive Order 12898,
requiring US-EPA to implement a program to "address
environmental justice in minority populations and low-income
populations." The executive order requires each federal
agency to make environmental justice principles "part of its
mission."
2)Extending SB 115 to CEC, With Some Additional Requirements .
SB 115 (Solis), Chapter 690, Statutes of 1999, signed into law
last year, requires all boards, departments, and offices
(associated with Cal-EPA) to incorporate environmental justice
principles into their mission statements. SB 115 requires OPR
to serve as the coordinating agency for environmental justice
programs in state government, and defines "environmental
justice" to mean "the fair treatment of people of all races,
cultures, and incomes with respect to the development,
adoption, implementation, and enforcement of environmental
statutes, ordinances, regulations, and public policies."
Because CEC is part of the Resources Agency instead of
Cal-EPA, the mission statement required by SB 115 does not
apply to CEC. This bill requires CEC to incorporate
environmental justice concepts into its overall mission, and
requires CEC, in developing a mission statement, to consider:
1) all applicable federal guidance relating to environmental
justice; and 2) to the extent available, the review of federal
guidance conducted by OPR. Additionally, this bill requires
CEC to adopt, on or before January 1, 2002, regulations that
will ensure each application contains sufficient information
to address environmental justice issues in a manner consistent
with the environmental justice mission statement developed and
adopted pursuant to this bill.
3)Environmental Justice and the Power Plant Siting Process . The
Warren-Alquist Act grants CEC exclusive authority to certify
power plants 50 megawatts (MW) and larger. The intent of this
bill, according to the author, is to ensure that there are CEC
environmental justice parameters codified in statute, and that
CEC fully comply with federal environmental justice guidelines
and Title VI of the Federal Civil Rights Act of 1964. The
Civil Rights Act prohibits recipients of federal financial
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assistance from discriminating on the basis of race, color, or
national origin in their programs or activities. Current law
does not require CEC to consider environmental justice issues
during their review process. However, because environmental
justice issues have been raised in CEC's siting cases, CEC
staff voluntarily applies federal environmental justice
guidelines issued by US-EPA (to implement the 1994 federal
executive order). Additionally, under existing practice, CEC
staff applies the federal guidelines to ensure compliance with
Title VI of the Civil Rights Act.
4)Consideration of Socioeconomic Issues . For all siting cases,
CEC follows the federal guidelines' two-step screening
process. The process assesses: 1) whether the potentially
affected community includes minority and/or low-income
populations; and 2) whether the environmental impacts are
likely to fall disproportionately on minority and/or
low-income members of the community. Depending on the outcome
of the screening process, local community groups are contacted
to provide CEC with a fuller understanding of potential
environmental justice issues. Additionally, under current
practice, local community groups are asked to help identify
potential mitigation measures.
5)Codifying Data Requirement for Power Plant Applicants Would
Increase Litigation Risk . This bill codifies an existing CEC
practice for power plant applicants to provide information
relating to environmental justice issues. While this bill
requires CEC to do what it already does voluntarily, it would
also add to the legal grounds on which CEC could be sued.
This, plus the fact CEC would be the only state or local
permitting authority operating under this same mandate, would
likely result in CEC's siting process becoming a test case for
environmental justice law, which could also lead to
substantial litigation.
6)Increased Lawsuits, and Subsequent Delays, Could Affect
Reliability of Electric Grid . AB 1890 (Brulte), Chapter 854,
Statues of 1996 established a competitive electric generation
market. The reliability of the electric grid depends on an
adequate supply of generation, but demand growth is outpacing
new generation additions. California's electricity
consumption is expected to increase 1.8 percent annually
through 2007. Since the enactment of AB 1890, CEC has
approved four new "merchant" plants for a total of 3,500 MW,
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compared with a statewide generation capacity of 53,000 MW.
Three of the four power plants are under construction, and
will come on line late next summer (2001). The California
Independent System Operator (Cal-ISO), which manages the
state's transmission grid and ensures system reliability,
predicts that the state will come up approximately 1,000 MW
short on unusually hot, summer days when peak demand could
rise to 48,900 MW. Cal-ISO and the state's investor-owned
utilities are taking short-term steps to guard against
reliability problems during the summer of 2000 and 2001,
including offering lower rates to large users provided they
agree to accept nonfirm, or interruptible power. The
Independent Energy Producers (IEP) assert that this bill will
significantly increase the "litigation risk for these
[merchant plant] projects at a time that they are especially
important to electric service reliability.
7)Related Legislation : SB 1408 (Alarcon), would enact the
Environmental Justice Technical Assistance Grant Demonstration
Program, and requires OPR to allocate grants of up to $25,000
to community-based nonprofit organizations in communities with
low-income or minority populations to obtain technical
assistance in connection with the organization's participation
in a decision involving, among other things, a certification
by CEC. SB 89 (Escutia) requires the Secretary of Cal-EPA, by
January 15, 2001, to convene a working group to take various
actions relating to the development and implementation of
environmental justice strategies related to the mission of
Cal-EPA, and requires the Secretary, not later than January 1,
2006, and every three years after, to prepare and submit to
the Governor and Legislature a report on the implementation of
this bill. Both measures are currently in the Assembly
Committee on Appropriations.
REGISTERED SUPPORT / OPPOSITION :
Support
California League of Conservation Voters
California Energy Commission
Center on Race, Poverty & the Environment
Communities for a Better Environment
Greenlining Institute
Latino Issues Forum
Sierra Club California
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Southeast Alliance for Environmental Justice
Sunlaw Energy Corporation
Planning and Conservation League
Opposition
California Chamber of Commerce
California Council for Environmental and Economic Balance
California Manufacturers & Technology Association
Enron
Independent Energy Producers
San Diego Chamber of Commerce
Western States Petroleum Association
Analysis Prepared by : Joseph Lyons / U. & C. / (916) 319-2083