Bill Text: CA SB993 | 2023-2024 | Regular Session | Amended

California Senate Bill 993

NOTE: There are more recent revisions of this legislation. Read Latest Draft

Bill Title: Clean energy development incentive rate tariff.

Spectrum: Partisan Bill (Democrat 1-0)

Status: (Introduced) 2024-05-16 - May 16 hearing: Held in committee and under submission. [SB993 Detail]

Download: California-2023-SB993-Amended.html

Amended IN Senate April 22, 2024

CALIFORNIA LEGISLATURE— 2023–2024 REGULAR SESSION

Senate Bill

No. 993

Introduced by Senator Becker

January 31, 2024

An act to add Section 740.23 to the Public Utilities Code, relating to electricity.

LEGISLATIVE COUNSEL'S DIGEST

SB 993, as amended, Becker. Clean energy development incentive rate tariff.

Existing law vests the Public Utilities Commission with regulatory authority over public utilities, including electrical corporations. Existing law authorizes the commission to fix the rates and charges for every public utility and requires that those rates and charges be just and reasonable.

This bill would require the commission, on or before July 1, 2026, in a new or existing proceeding, to evaluate and, if just and reasonable, establish a clean energy development incentive rate time-of-use tariff to encourage the development of new commercial or industrial electrical loads that contribute to the state’s efforts to reduce the emissions of greenhouse gases. The bill would require the tariff to offer lower rates for customers and to meet specified requirements, including, among other things, that the program only be open to new electrical customers that did not establish service before January 1, 2025, or to existing electrical customers that are expected to increase their total annual electrical demand by more than 50% after beginning service under the tariff. The bill would require that the tariff only be open to customers ~~with certain uses, including~~ producing hydrogen using an electrolysis of water ~~and~~ or using electricity to provide industrial process heat. The bill would require the tariff to be available to bundled customers of electrical corporations until the tariff meets a statewide limitation of 5,000 megawatts of customer participation.

Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.

Because the provisions of this bill would be a part of the act and because a violation of a commission action implementing the bill’s requirements would be a crime, the bill would impose a state-mandated local program.

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.

Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: YES

The people of the State of California do enact as follows:

SECTION 1.

Section 740.23 is added to the Public Utilities Code, to read:

740.23.

(a) On or before July 1, 2026, the commission shall, in a new or existing proceeding, evaluate and, if just and reasonable, establish a clean energy development incentive rate time-of-use tariff to encourage the development of new large commercial or industrial electrical loads for facilities that contribute to the state’s efforts to reduce the emissions of greenhouse gases. The tariff shall offer lower electricity rates for customers and shall have the following requirements:

(1) The tariff shall only be open to new electrical customers that did not establish service before January 1, 2025, or to existing electrical customers that increase their total annual electrical demand by more than 50 percent after beginning service under the tariff.

(2) The tariff is only open to customers with loads that can operate flexibly to improve grid resilience by aligning their demand with times and locations of plentiful renewable or zero-carbon electricity, while curtailing demand during other times.

(3) The hourly tariff rates are as low as feasible, while still sufficient to cover the marginal cost of service in that hour, all applicable nonbypassable charges, and a portion of nonmarginal costs.

(4) The tariff provides significantly higher rates in other hours that are sufficient to encourage a reduction in demand or full curtailment of demand when that would help reduce total costs for the electrical system, such as during periods of peak grid demand or periods of local or regional transmission congestion.

(5) The tariff requires the customers to be interruptible during times of peak grid ~~usage, and the tariff provides that the load-serving entity shall not be required to supply resource adequacy for the customer’s load during times of peak grid~~ usage. The commission shall consider tariffed customer’s interruptible load when determining a load-serving entity’s resource adequacy requirements.

(b) The tariff shall not result in a cost-shift between customer classes.

(1) Producing hydrogen using an electrolysis of water.

(2) Using electricity to provide industrial process heat, including through the use of a thermal energy storage system.

(d)The commission shall consider whether the rate program should include an option for a load-serving entity, as defined in Section 380, to provide hourly time-matched renewable or zero-carbon energy that would meet the requirements of the Clean Hydrogen Production Tax Credit (26 U.S.C. Section 45V) so that program participants could rely on the delivered electricity to meet those requirements.
~~(e)~~

(d) The tariff shall be available to bundled customers of electrical corporations. Customers of other load-serving entities shall be eligible if their load-serving entity elects to offer the tariff and provides a generation rate component comparable to that included in the tariff for bundled customers of an electrical corporation. corporations until the tariff meets a statewide limitation of 5,000 megawatts of customer participation.

SEC. 2.

No reimbursement is required by this act pursuant to Section 6 of Article XIII B 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 XIII B of the California Constitution.