February 17, 2017 marked the deadline by which legislators had to introduce bills for the first half of the 2017-2018 Legislative Session. The Stoel Rives’ Energy Team has been and will continue to monitor bills throughout the two-year session and will provide periodic updates as to the status of those bills. Most noteworthy here is SB 584 which would require 100% of all electricity sold in California at retail to be generated by eligible renewable energy resources by December 31, 2045. A summary of SB 584 is provided below, in addition to the status and summary of other energy related bills Stoel Rives is monitoring, starting with a set of bills related to energy storage.

SB 584 (De León). California Renewables Portfolio Standard Program.

Under existing law, the California Public Utilities Commission (“CPUC”) has regulatory authority over public utilities, including electrical corporations, while local publicly owned electric utilities, as defined, are under the direction of their governing boards. The California Renewables Portfolio Standard Program requires the CPUC to establish a renewables portfolio standard requiring all retail sellers, as defined, to procure a minimum quantity of electricity products from eligible renewable energy resources, as defined, so that the total kilowatt-hours of those products sold to their retail end-use customers achieves 25% of retail sales by December 31, 2016, 33% by December 31, 2020, 40% by December 31, 2024, 45% by December 31, 2027, and 50% by December 31, 2030. The program additionally requires each local publicly owned electric utility, as defined, to procure a minimum quantity of electricity products from eligible renewable energy resources to achieve the procurement requirements established by the program. The Legislature has separately declared that its intent in implementing the program is to attain, among other targets for sale of eligible renewable resources, the target of 50% of total retail sales of electricity by December 31, 2030. This bill would revise those legislative findings and declarations to state that the goal of the program is to achieve that 50% target by December 31, 2025, and for all electricity sold at retail to be generated by eligible renewable energy resources by December 31, 2045.

Bills Related to Energy Storage

SB 71 (Wiener, D): Electricity: solar energy systems.
STATUS: Introduced January 9, 2017; awaiting referral.

Existing law provides that the CPUC has regulatory authority over public utilities, including electrical corporations and current statutes and decisions of the CPUC govern the California Solar Initiative, a program that provides ratepayer-funded incentives for eligible solar energy systems. The Solar Water Heating and Efficiency Act of 2007, until August 1, 2018, requires the CPUC, if it determines that a solar water heating program is cost effective for ratepayers and in the public interest, to implement a program to promote the installation of 200,000 solar water heating systems in homes, businesses, and buildings or facilities of eligible customer classes receiving natural gas service throughout the state by 2017. SB 71 would express the intent of the Legislature to enact future legislation that would require the installation of solar photovoltaic systems or solar water heating systems in solar zones provided for pursuant to specified regulations.

AB 546 (Chiu, D): Land use: local ordinances: energy systems.
STATUS: Introduced February 14, 2017; awaiting referral.

Existing law, the Planning and Zoning Law, among other things, requires the legislative body of each county and city to adopt a general plan for the physical development of the county or city and authorizes the adoption and administration of zoning laws, ordinances, rules, and regulations by counties and cities and requires a city, county, or city and county to approve an application for the installation of electric vehicle charging stations, as defined, through the issuance of specified permits unless the city or county makes specified written findings. Existing law further provides that the implementation of consistent statewide standards to achieve the timely and cost-effective installation of electric vehicle charging stations is a matter of statewide concern. If passed, AB 546 would:

• require on or before September 30, 2018, for a city, county, or city and county with a population of 200,000 or more residents, or January 31, 2019, for a city, county, or city and county with a population of less than 200,000 residents, require the city, county, or city and county to make all documentation and forms associated with the permitting of advanced energy storage available on a publicly accessible Internet Web site;
• prohibit the calculation of a fee associated with the permitting or inspection of an advanced energy storage installation from being calculated based on the value of the installation or any other factor not directly associated with the cost to issue the permit and inspect the advanced energy storage installation; and,
• require the Governor’s Office of Planning and Research, on or before January 1, 2020, to create a California Energy Storage Permitting Guidebook, as specified.

AB 914 (Mullin, D): Transmission planning: energy storage and demand response.
STATUS: Introduced February 16, 2017; awaiting referral.

Existing law vests the CPUC with jurisdiction over the delivery of electrical services, provides for the establishment of an Independent System Operator (“ISO”) as a nonprofit public benefit corporation and requires the ISO to make certain filings with the Federal Energy Regulatory Commission (“FERC”) and to seek authority from FERC to give ISO the ability to secure generating and transmission resources necessary to guarantee achievement of planning and operating reserve criteria no less stringent than those established by the Western Electricity Coordinating Council and the North American Electric Reliability Council. If passed, this bill would require the CPUC, in its participation in the ISO’s transmission planning process, to promote the consideration of the use of energy storage systems and demand response as means to address the state’s transmission needs before the use of transmission wires.

AB 1030 (Ting, D): Energy storage systems.
STATUS: Introduced February 16, 2017; awaiting referral.

Existing law requires the CPUC to open a proceeding to determine appropriate targets, if any, for each load-serving entity to procure viable and cost-effective energy storage systems to be achieved by December 31, 2015, and December 31, 2020. If determined to be appropriate, the CPUC is required to adopt the procurement targets and to reevaluate all of these determinations not less than once every three years. AB 1030 would require the CPUC to establish a program to incentivize residential and commercial customers to adopt energy storage systems.

SB 356 (Skinner, D): Energy storage systems.
STATUS: Introduced February 14, 2017; awaiting referral..

Under current law, the CPUC has regulatory authority over public utilities, including electrical corporations. Current law requires the commission to open a proceeding to determine appropriate targets, if any, for each load-serving entity, as defined, to procure viable and cost-effective energy storage systems to be achieved by December 31, 2015, and December 31, 2020. This bill would make a non-substantive change in legislative findings and declarations adopted with the above-described energy storage system requirements.

Additional Bills of Interest

AB 79 (Levine, D): Electrical generation: coal fired generation resources.
STATUS: Introduced January 4, 2017; referred to Committee on Utilities and Energy on January 19, 2017.

Existing law requires the California Energy Commission (“CEC”) to certify sufficient sites and related facilities that are required to provide a supply of electricity sufficient to accommodate projected demand for power statewide. AB 79 would require the CEC to ensure that by January 1, 2019, no more than 6 percent and by January 1, 2024, no more than 3 percent, of the electricity consumed in the state is generated from coal-fired generation resources, and to ensure that by January 1, 2026, no electricity consumed in the state is generated from a coal-fired generation resource. This bill would additionally prohibit any load-serving entity and any local publicly owned electric utility from entering into a financial commitment to procure electricity generated on and after January 1, 2026, from coal-fired generation resources.

AB 397 (Gipson, D): Public Utilities: facility modernization.
STATUS: Introduced February 9, 2017; awaiting referral.

Existing law authorizes the CPUC to fix the rates and charges for every public utility and requires those rates to be just and reasonable. In addition, existing law authorizes the CPUC, after a hearing, to make and serve an order directing additions, extensions, repairs, improvements, or other changes be made to existing plant, equipment, apparatus, facilities, or other physical property of a public utility, if it makes certain findings. This bill would require the CPUC to require an electrical or gas corporation to give preference to the modernization of its facilities serving disadvantaged communities if the corporation is authorized to collect ratepayer funds for the modernization of its facilities.

AB 457 (Cunningham, R): Saline water conversion: Diablo Canyon Nuclear Plant.
STATUS: Introduced February 13, 2017; awaiting referral.

This bill would declare the intent of the legislature to enact legislation that would require a study of the feasibility of repurposing for local use water produced by the water desalination facility at the Diablo Canyon Nuclear Plant in the County of San Luis Obispo.

AB 520 (Harper, R): Local government: energy source materials.
STATUS: Introduced February 13, 2017; awaiting referral.

The California Constitution authorizes cities and counties to make and enforce within their

limits all local, police, sanitary, and other ordinances and regulations not in conflict with general laws, and further authorizes cities organized under a charter to make and enforce all ordinances and regulations in respect to municipal affairs, which supersede inconsistent general laws. This bill would prohibit a local agency, as defined, from prohibiting the shipment or storage of any energy source material, including, but not limited to, coal, within its jurisdiction. The bill would declare that its provisions constitute a matter of statewide concern.

AB 726 (Holden, D): Electricity: tiered rates: notification of usage.
STATUS: Introduced February 15, 2017; awaiting referral.

If enacted, AB 726 would require an electrical corporation to notify a residential customer in a reasonably expeditious manner when the customer’s usage of electricity will cause the customer to be charged for additional electricity consumption at a higher tiered rate during a billing cycle. The bill would additionally require an electrical corporation providing service to a residential customer pursuant to a tiered rate structure based on usage to notify the customer that the customer may receive notification of the customer’s electricity usage as required by the bill, the manner by which the customer can provide appropriate contact information, as determined by the CPUC, to receive this information, and the customer’s opportunity to opt in or opt out of receiving this information. Because the provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.

AB 797 (Irwin, D): Solar thermal systems.
STATUS: Introduced February 15, 2017; awaiting referral.

The Solar Water Heating and Efficiency Act of 2007, until August 1, 2018, requires the Public Utilities Commission, if it determines that a solar water heating program is cost effective for ratepayers and in the public interest, to implement a program to promote the installation of 200,000 solar water heating systems. This bill would revise the program to, among other things, promote the installation of solar thermal systems throughout the state, set the maximum funding for the program between January 1, 2018, and July 31, 2023, at $250,000,000, reserve 50 percent of the total program budget for the installation of solar thermal systems in low-income residential housing or in buildings in disadvantaged communities, and extend the operation of the program through July 31, 2023.

AB 881 (Gallagher, R): Solid waste: composting: anaerobic digestion.
STATUS: Introduced February 16, 2017; awaiting referral.

If enacted, AB 881 would express the intent of the legislature to enact legislation to encourage investment in anaerobic digestion.

AB 35 (Quirk, D): Energy: energy efficiency programs: low-income communities.
STATUS: Introduced December 15, 2016; awaiting referral.

Current law requires the CPUC to ensure that low-income ratepayers are not jeopardized or overburdened by monthly energy expenditures. In addition, existing law authorizes energy expenditures to be reduced, for these purposes, through the establishment of different rates for low-income ratepayers, different levels of rate assistance, and energy efficiency programs. AB 35 would enact legislation that would require agencies implementing energy efficiency programs to establish metrics and collect and use data systematically across those programs to increase the performance of those programs in low-income communities.

SB 518 (De León, D): California Clean Energy Jobs Act: citizen oversight board.
STATUS: Introduced February 16, 2017; awaiting referral.

The California Clean Energy Jobs Act made changes to corporate income taxes and provided for the transfer of $550,000,000 annually from the General Fund to the Clean Energy Job Creation Fund for five fiscal years beginning with the 2013–14 fiscal year. Moneys in the fund are available, upon appropriation by the Legislature, for purposes of funding eligible projects that create jobs in California improving energy efficiency and expanding clean energy generation.

Existing law, until fiscal year 2017–18, provides for the allocation of moneys in the Clean Energy Job Creation Fund to local educational agencies and community college districts, as specified. Existing law, until July 1, 2019, prescribes the operation of the board and establishes the additional authority and duties of the board. SB 518 would continue the allocation of any moneys in the Clean Energy Job Creation Fund through fiscal year 2022–23 and would extend the operation of the board and of its additional authority and duties to July 1, 2023.

SB 520 (Mitchell D) Electricity: intervenor funding.
STATUS: Introduced February 16, 2017; awaiting referral.

Existing law requires the CPUC to award reasonable advocate’s fees, reasonable expert witness fees, and other reasonable costs of preparation for and participation in a hearing or proceeding of the CPUC involving an electrical, gas, water, or telephone corporation to a customer who complies with specified procedures when the customer’s presentation makes a substantial contribution to the adoption, in whole or in part, of the CPUC’s order or decision and where participation or intervention without an award of fees or costs imposes a significant financial hardship. This bill would establish a mechanism to provide compensation for reasonable advocate’s fees, reasonable expert witness fees, and other reasonable costs of participation in processes of ISO, proceedings of FERC that effect California’s environment and consumers, and certain proceedings at the State Energy Resources Conservation and Development Commission.

SB 549 (Bradford D) Public utilities: reports: moneys for maintenance and safety.
STATUS: Introduced February 16, 2017; awaiting referral.

Existing law places various responsibilities upon the CPUC to ensure that public utility services are provided in a manner that protects the public safety and the safety of utility employees. SB 549 would require an electrical or gas corporation to report to the CPUC, within 60 days, when moneys authorized by the CPUC for maintenance or safety are reprioritized for other purposes and require the CPUC to include the report in the docket of an appropriate proceeding and serve the report pursuant to the service list of that proceeding.