Bill Text: CA AB1832 | 2015-2016 | Regular Session | Introduced
Bill Title: California Renewables Portfolio Standard Program
Spectrum: Partisan Bill (Republican 1-0)
Status: (Failed) 2016-11-30 - Died at Desk. [AB1832 Detail]
Download: California-2015-AB1832-Introduced.html
BILL NUMBER: AB 1832 INTRODUCED
BILL TEXT
INTRODUCED BY Assembly Member Dahle
FEBRUARY 9, 2016
An act to amend Section 399.13 of the Public Utilities Code,
relating to energy.
LEGISLATIVE COUNSEL'S DIGEST
AB 1832, as introduced, Dahle. California Renewables Portfolio
Standard Program
Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including electrical corporations.
The Public Utilities Act requires the commission to review and
accept, modify, or reject a procurement plan for each electrical
corporation based on whether it includes specified elements or
incentive mechanisms, and whether it accomplishes certain objectives.
The California Renewables Portfolio Standard Program, within the
act, requires retail sellers, defined as including electrical
corporations, and local publicly owned electric utilities to purchase
specified minimum quantities of electricity products from eligible
renewable energy resources, as defined, for specified compliance
periods. The program requires the commission to direct each
electrical corporation to annually prepare a renewable energy
procurement plan to satisfy its procurement requirements pursuant to
the program. To the extent feasible, the renewable energy procurement
plan is to be proposed, reviewed, and adopted as part of, and
pursuant to, the general procurement plan process.
This bill would make a nonsubstantive revision to the provision
that requires, to the extent feasible, that the renewable energy
procurement plan be proposed, reviewed, and adopted as part of, and
pursuant to, the general procurement plan process.
Vote: majority. Appropriation: no. Fiscal committee: no.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 399.13 of the Public Utilities Code is amended
to read:
399.13. (a) (1) The commission shall direct each electrical
corporation to annually prepare a renewable energy procurement plan
that includes the matter in paragraph (5), to satisfy its obligations
under the renewables portfolio standard. To the extent feasible,
this procurement plan shall be proposed, reviewed, and adopted by the
commission as part of, and pursuant to, a
the general procurement plan process.
process (Sections 454.5 to 454.55, inclusive). The commission
shall require each electrical corporation to review and update its
renewable energy procurement plan as it determines to be necessary.
The commission shall require all other retail sellers to prepare and
submit renewable energy procurement plans that address the
requirements identified in paragraph (5).
(2) Every electrical corporation that owns electrical transmission
facilities shall annually prepare, as part of the Federal Energy
Regulatory Commission Order 890 process, and submit to the
commission, a report identifying any electrical transmission
facility, upgrade, or enhancement that is reasonably necessary to
achieve the renewables portfolio standard procurement requirements of
this article. Each report shall look forward at least five years
and, to ensure that adequate investments are made in a timely manner,
shall include a preliminary schedule when an application for a
certificate of public convenience and necessity will be made,
pursuant to Chapter 5 (commencing with Section 1001), for any
electrical transmission facility identified as being reasonably
necessary to achieve the renewable energy resources procurement
requirements of this article. Each electrical corporation that owns
electrical transmission facilities shall ensure that project-specific
interconnection studies are completed in a timely manner.
(3) The commission shall direct each retail seller to prepare and
submit an annual compliance report that includes all of the
following:
(A) The current status and progress made during the prior year
toward procurement of eligible renewable energy resources as a
percentage of retail sales, including, if applicable, the status of
any necessary siting and permitting approvals from federal, state,
and local agencies for those eligible renewable energy resources
procured by the retail seller, and the current status of compliance
with the portfolio content requirements of subdivision (c) of Section
399.16, including procurement of eligible renewable energy resources
located outside the state and within the WECC and unbundled
renewable energy credits.
(B) If the retail seller is an electrical corporation, the current
status and progress made during the prior year toward construction
of, and upgrades to, transmission and distribution facilities and
other electrical system components it owns to interconnect eligible
renewable energy resources and to supply the electricity generated by
those resources to load, including the status of planning, siting,
and permitting transmission facilities by federal, state, and local
agencies.
(C) Recommendations to remove impediments to making progress
toward achieving the renewable energy resources procurement
requirements established pursuant to this article.
(4) The commission shall adopt, by rulemaking, all of the
following:
(A) A process that provides criteria for the rank ordering and
selection of least-cost and best-fit eligible renewable energy
resources to comply with the California Renewables Portfolio Standard
Program obligations on a total cost and best-fit basis. This process
shall take into account all of the following:
(i) Estimates of indirect costs associated with needed
transmission investments.
(ii) The cost impact of procuring the eligible renewable energy
resources on the electrical corporation's electricity portfolio.
(iii) The viability of the project to construct and reliably
operate the eligible renewable energy resource, including the
developer's experience, the feasibility of the technology used to
generate electricity, and the risk that the facility will not be
built, or that construction will be delayed, with the result that
electricity will not be supplied as required by the contract.
(iv) Workforce recruitment, training, and retention efforts,
including the employment growth associated with the construction and
operation of eligible renewable energy resources and goals for
recruitment and training of women, minorities, and disabled veterans.
(v) (I) Estimates of electrical corporation expenses resulting
from integrating and operating eligible renewable energy resources,
including, but not limited to, any additional wholesale energy and
capacity costs associated with integrating each eligible renewable
resource.
(II) No later than December 31, 2015, the commission shall approve
a methodology for determining the integration costs described in
subclause (I).
(vi) Consideration of any statewide greenhouse gas emissions limit
established pursuant to the California Global Warming Solutions Act
of 2006 (Division 25.5 (commencing with Section 38500) of the Health
and Safety Code).
(vii) Consideration of capacity and system reliability of the
eligible renewable energy resource to ensure grid reliability.
(B) Rules permitting retail sellers to accumulate, beginning
January 1, 2011, excess procurement in one compliance period to be
applied to any subsequent compliance period. The rules shall apply
equally to all retail sellers. In determining the quantity of excess
procurement for the applicable compliance period, the commission
shall retain the rules adopted by the commission and in effect as of
January 1, 2015, for the compliance period specified in subparagraphs
(A) to (C), inclusive, of paragraph (1) of subdivision (b) of
Section 399.15. For any subsequent compliance period, the rules shall
allow the following:
(i) For electricity products meeting the portfolio content
requirements of paragraph (1) of subdivision (b) of Section 399.16,
contracts of any duration may count as excess procurement.
(ii) Electricity products meeting the portfolio content
requirements of paragraph (2) or (3) of subdivision (b) of Section
399.16 shall not be counted as excess procurement. Contracts of any
duration for electricity products meeting the portfolio content
requirements of paragraph (2) or (3) of subdivision (b) of Section
399.16 that are credited towards a compliance period shall not be
deducted from a retail seller's procurement for purposes of
calculating excess procurement.
(iii) If a retail seller notifies the commission that it will
comply with the provisions of subdivision (b) for the compliance
period beginning January 1, 2017, the provisions of clauses (i) and
(ii) shall take effect for that retail seller for that compliance
period.
(C) Standard terms and conditions to be used by all electrical
corporations in contracting for eligible renewable energy resources,
including performance requirements for renewable generators. A
contract for the purchase of electricity generated by an eligible
renewable energy resource, at a minimum, shall include the renewable
energy credits associated with all electricity generation specified
under the contract. The standard terms and conditions shall include
the requirement that, no later than six months after the commission's
approval of an electricity purchase agreement entered into pursuant
to this article, the following information about the agreement shall
be disclosed by the commission: party names, resource type, project
location, and project capacity.
(D) An appropriate minimum margin of procurement above the minimum
procurement level necessary to comply with the renewables portfolio
standard to mitigate the risk that renewable projects planned or
under contract are delayed or canceled. This paragraph does not
preclude an electrical corporation from voluntarily proposing a
margin of procurement above the appropriate minimum margin
established by the commission.
(5) Consistent with the goal of increasing California's reliance
on eligible renewable energy resources, the renewable energy
procurement plan shall include all of the following:
(A) An assessment of annual or multiyear portfolio supplies and
demand to determine the optimal mix of eligible renewable energy
resources with deliverability characteristics that may include
peaking, dispatchable, baseload, firm, and as-available capacity.
(B) Potential compliance delays related to the conditions
described in paragraph (5) of subdivision (b) of Section 399.15.
(C) A bid solicitation setting forth the need for eligible
renewable energy resources of each deliverability characteristic,
required online dates, and locational preferences, if any.
(D) A status update on the development schedule of all eligible
renewable energy resources currently under contract.
(E) Consideration of mechanisms for price adjustments associated
with the costs of key components for eligible renewable energy
resource projects with online dates more than 24 months after the
date of contract execution.
(F) An assessment of the risk that an eligible renewable energy
resource will not be built, or that construction will be delayed,
with the result that electricity will not be delivered as required by
the contract.
(6) In soliciting and procuring eligible renewable energy
resources, each electrical corporation shall offer contracts of no
less than 10 years duration, unless the commission approves of a
contract of shorter duration.
(7) In soliciting and procuring eligible renewable energy
resources for California-based projects, each electrical corporation
shall give preference to renewable energy projects that provide
environmental and economic benefits to communities afflicted with
poverty or high unemployment, or that suffer from high emission
levels of toxic air contaminants, criteria air pollutants, and
greenhouse gases.
(8) In soliciting and procuring eligible renewable energy
resources, each retail seller shall consider the best-fit attributes
of resource types that ensure a balanced resource mix to maintain the
reliability of the electrical grid.
(b) A retail seller may enter into a combination of long- and
short-term contracts for electricity and associated renewable energy
credits. Beginning January 1, 2021, at least 65 percent of the
procurement a retail seller counts toward the renewables portfolio
standard requirement of each compliance period shall be from its
contracts of 10 years or more in duration or in its ownership or
ownership agreements for eligible renewable energy resources.
(c) The commission shall review and accept, modify, or reject each
electrical corporation's renewable energy resource procurement plan
prior to the commencement of renewable energy procurement pursuant to
this article by an electrical corporation. The commission shall
assess adherence to the approved renewable energy resource
procurement plans in determining compliance with the obligations of
this article.
(d) Unless previously preapproved by the commission, an electrical
corporation shall submit a contract for the generation of an
eligible renewable energy resource to the commission for review and
approval consistent with an approved renewable energy resource
procurement plan. If the commission determines that the bid prices
are elevated due to a lack of effective competition among the
bidders, the commission shall direct the electrical corporation to
renegotiate the contracts or conduct a new solicitation.
(e) If an electrical corporation fails to comply with a commission
order adopting a renewable energy resource procurement plan, the
commission shall exercise its authority to require compliance.
(f) (1) The commission may authorize a procurement entity to enter
into contracts on behalf of customers of a retail seller for
electricity products from eligible renewable energy resources to
satisfy the retail seller's renewables portfolio standard procurement
requirements. The commission shall not require any person or
corporation to act as a procurement entity or require any party to
purchase eligible renewable energy resources from a procurement
entity.
(2) Subject to review and approval by the commission, the
procurement entity shall be permitted to recover reasonable
administrative and procurement costs through the retail rates of
end-use customers that are served by the procurement entity and are
directly benefiting from the procurement of eligible renewable energy
resources.
(g) Procurement and administrative costs associated with contracts
entered into by an electrical corporation for eligible renewable
energy resources pursuant to this article and approved by the
commission are reasonable and prudent and shall be recoverable in
rates.
(h) Construction, alteration, demolition, installation, and repair
work on an eligible renewable energy resource that receives
production incentives pursuant to Section 25742 of the Public
Resources Code, including work performed to qualify, receive, or
maintain production incentives, are "public works" for the purposes
of Chapter 1 (commencing with Section 1720) of Part 7 of Division 2
of the Labor Code.
