BILL ANALYSIS
SB 1709
Page 1
Date of Hearing: June 12, 2000
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Roderick Wright, Chair
SB 1709 (Kelley) - As Amended: May 16, 2000
SENATE VOTE : 32-1
SUBJECT : Public utilities: electrical corporation.
SUMMARY : Clarifies that providers of digestive gas technologies
are exempt from the definition of an electrical corporation and
from regulation by the California Public Utilities Commission
(CPUC). Specifically, this bill :
1)Excludes corporations or persons employing digester gas
technology for the generation of electricity for certain
purposes from the definition of an electrical corporation.
2)Specifies that the corporation using digester gas technology
is exempt if the electricity it produces is in the following
manner:
a)For its own use or the use of not more that two of its
tenants located on the real property on which the
electricity is generated.
b)For the use or sale to not more than two other corporations
or persons solely for use on the real property on which the
electricity is generated.
c)For the sale or transmission to an electrical corporation
or state or local public agency.
d)For the sale or transmission to a retail customer provided
the electricity is delivered through the transmission
system of the existing local publicly owned electric
utility or electrical corporation of that retail customer.
EXISTING LAW
1)Defines an electrical corporation as every corporation or
person owning, controlling, operating, or managing any
electric plant for compensation in the state -- except where
the electricity is generated for its own use or the use of its
SB 1709
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tenants and not for sale or transmission to others.
2)Excludes power producers that employ landfill gas technology
for the generation of electricity for certain purposes.
FISCAL EFFECT : Unknown.
COMMENTS :
1)The author has introduced this bill to provide for an
exemption from the definition of an electrical corporation any
corporation or person employing digester gas technology that
results in the production of electricity. Digester gas is the
methane (natural gas) that comes from the treatment or
decomposition of organic materials (including cow manure and
human waste). Water treatment plants and sewage treatment
facilities are the major sources of digester gas. The methane
gas can be burned to generate electricity. Digester gas is
similar to landfill gas. They both are based on collecting
methane that results from waste. Landfill gas, however, comes
from solid waste (garbage that you might find at a dump).
Methane gas in the digester process can be disposed of in one
of three ways: it can be vented into the atmosphere, burnt in
a flare, or used to generate electricity.
2)The Association of California Water Agencies indicates that
this bill is intended to eliminate a discrepancy in the law
that allows for the production and sale of electricity using
landfill gas as the primary fuel, and to make it economical
for them to use the methane gas to generate electricity. The
sponsor notes that several water treatment facilities capture
gas that would otherwise be burned and released into the open
air and using digester gas technology are turning it into
electric power for their own use and for sale to others. This
bill provides that biofuel produced as digester gas would also
be exempted from the definition of an electrical corporation
so long as the electricity is generated for specified
purposes.
3)Section 218 of the Public Utilities Code already provides for
exemptions from the definition of an electrical corporation in
the following instances where the power is produced: a) for
one's own use; b) for the use of tenants; c) for the use of
two or more corporations or persons whose property is adjacent
to the property where the electricity is being generated; d)
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for the sale or transmission to a state or local agency, but
not for the sale or transmission to others unless the
corporation or person is an electrical corporation. This bill
would adopt those same principles. An additional use,
however, would allow the sale or transmission of electricity
produced through digester gas technology to a retail customer
so long as the transmission system of the existing local
publicly owned utility or electrical corporation is used to
provide services to that customer.
REGISTERED SUPPORT / OPPOSITION :
Support
Association of California Water Agencies
County Sanitation Districts of Los Angeles County
Inland Empire Utilities Agency
California Association of Sanitation Agencies
Sierra Club
Opposition
None of file.
Analysis Prepared by : Carolyn Veal-Hunter / U. & C. / (916)
319-2083