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SB-426 State Energy Resources Conservation and Development Commission: liquefied natural gas terminals.(2005-2006)

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SB426:v93#DOCUMENT

Amended  IN  Assembly  August 24, 2006
Amended  IN  Assembly  August 31, 2005
Amended  IN  Assembly  July 13, 2005
Amended  IN  Assembly  June 21, 2005
Amended  IN  Senate  May 27, 2005
Amended  IN  Senate  April 13, 2005

CALIFORNIA LEGISLATURE— 2005–2006 REGULAR SESSION

Senate Bill
No. 426

Introduced  by  Senator Simitian
 (Principal Coauthor(s): Assembly Member Pavley)

February 17, 2005

An act to add Chapter 6.6 (commencing with Section 25570) to Division 15 of the Public Resources Code, relating to energy.


LEGISLATIVE COUNSEL'S DIGEST


SB 426, as amended, Simitian. State Energy Resources Conservation and Development Commission: liquefied natural gas terminals.
The existing Warren-Alquist State Energy Resources Conservation and Development Act establishes the State Energy Resources Conservation and Development Commission and requires the commission to prepare a biennial integrated energy policy report. The act requires the commission to certify sufficient sites and related facilities that are required to provide a supply of electricity sufficient to accommodate projected demand for power statewide. The act grants the commission the exclusive authority to certify any stationary or floating electrical generating facility using any source of thermal energy, with a generating capacity of 50 megawatts or more, and any facilities appurtenant thereto.
This bill would enact the Liquefied Natural Gas Terminal Evaluation Act which that would require the commission to evaluate and rank every proposed liquefied natural gas (LNG) terminal pursuant to the act. The bill would require that the evaluation be commenced by January 1, 2006 2007, include an evaluation of all applications received by and deemed sufficiently complete by the lead agency for the purposes of the commission’s evaluation44 before that date, and report the results of that evaluation to the Governor and the Legislature by April 1, 2006. be completed by April 1, 2007. The bill would require the report of the results of that evaluation be submitted to the Governor and the Legislature by May 1, 2007. The bill would require the commission to evaluate any LNG terminal application received and deemed sufficiently complete on or after January 1, 2006 2007, by the lead agency for purposes of the commission’s evaluation, within 90 days from the date the application is deemed sufficiently complete, and to report the results of that evaluation to the Governor and the Legislature immediately thereafter. The bill would require the energy commission to hold public hearings to consider the results of the LNG evaluation terminal ranking to provide an opportunity for public comment. All costs of the commission for the implementation of these requirements, including costs for any temporary personnel or consultants, would be funded from fees charged to persons or entities proposing an LNG terminal that is evaluated and ranked pursuant to the act. The bill would require the commission to evaluate and rank a site for which an application for an LNG terminal has been filed, based upon certain criteria and in consultation with specified entities. The bill would require the Governor to disapprove an application for a license to construct and operate an LNG terminal unless the proposed facility is evaluated and ranked, as specified, and the site proposal is one of the two highest ranked sites pursuant to the act, and the Governor determines that among the available feasible technologies the technology chosen for a particular site will minimize adverse public health, safety, and environmental impacts. The bill would provide that these requirements are applicable to every LNG terminal to be constructed or operating in California, irrespective of whether an application has been submitted for the construction or operation of the terminal to any federal, state, or local entity prior to the operative date of the bill. The bill would require the State Lands Commission, or a legislatively designated grantee, to evaluate and consider any application for a permit to construct and operate LNG facilities on state tide or submerged lands within its jurisdiction pursuant to the requirements of this bill.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

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


SECTION 1.

 The Legislature finds and declares all of the following:
(a) It is the policy of the state to meet California’s energy growth by optimizing energy conservation and resource efficiency and by reducing per capita demand to ensure a clean, safe, and reliable supply of energy for California.
(b) It is the policy of the state to be sensitive to the impact of the state’s energy policy on global climate change and environmental impacts in host countries that export natural gas.
(c) It is the policy of the state to accelerate the use of renewable energy resources wherever feasible and to ensure a diverse and affordable portfolio of fuel sources to minimize the opportunity for supply interruptions.
(d) The state has a role in decisions regarding the siting and design of new onshore and offshore infrastructure for the importation of liquefied natural gas that results in impacts to public health, safety, and the environment.
(e) Laws and regulations enacted by the state to address consumer, community, public health, safety, and environmental impacts of new onshore and offshore imported liquefied natural gas infrastructure, where more protective, should not be preempted by weaker, less protective federal laws and regulations.
(f) Decisions regarding the importation of liquefied natural gas should be based on a comprehensive review of current and projected natural gas supply and demand in California, and alternative sources of supply.
(g) Construction and operation of liquefied natural gas onshore and offshore infrastructure may commence after completion of a rigorous evaluation that analyzes the need for liquefied natural gas and the relative merits of pending and future proposals with respect to business, consumer, community, public health, safety, and environmental impacts.
(h) Based upon the Tenth Amendment to the United States Constitution, federal law neither abrogates a state’s property rights within its tide and submerged lands nor provides the power of eminent domain to the Federal Energy Regulatory Commission with respect to the siting liquefied natural gas facilities.
(i) Nothing in this bill shall be construed as an absolute prohibition on the construction of LNG facilities on or off the California coast. It is the intent of the State of California to facilitate a comprehensive and efficient review of applications for liquefied natural gas terminals and their related infrastructure in the state.

SEC. 2.

 Chapter 6.6 (commencing with Section 25570) is added to Division 15 of the Public Resources Code, to read:
CHAPTER  6.6. Liquefied Natural Gas Terminal Evaluation Act
Article  1. General Provisions

25570.
 This chapter shall be known and may be cited as the Liquefied Natural Gas Terminal Evaluation Act.

25570.1.
 For purposes of this chapter, the following definitions apply:
(a) “Feasible” means capable of being accomplished in a successful manner within a reasonable period of time, taking into account all of the following:
(1) Economic, environmental, social, technological, safety, and reliability factors.
(2) Gas supply and demand forecasts.
(3) Alternative sources of natural gas.
(b) “Liquefied natural gas” or “LNG” means natural gas cooled to minus 259 degrees Fahrenheit so that it forms a liquid at approximately atmospheric pressure.
(c) “Liquefied natural gas terminal,” “terminal,” or “LNG terminal,” means facilities designed to receive liquefied natural gas from oceangoing vessels, including those facilities required for storage and regasification of the liquefied natural gas and those pipelines and facilities necessary for the transmission of the regasified natural gas to the point of interconnection with existing pipelines.
(d) “Person” means an individual, organization, partnership, or other business association or corporation, the federal government, the state government, any local government, and any agency or instrumentality of any of those entities.

Article  2. Evaluation of Potential Liquefied Natural Gas Terminals and Alternatives

25571.
 In furtherance of and in conformance with the federal Deepwater Port Act of 1974 (33 U.S.C. Sec. 1501 et seq.), as amended, the Governor shall disapprove an application for a license to construct and operate a liquefied natural gas terminal unless:
(a) The proposed facility is evaluated and its site ranked pursuant to this article.
(b) The site is one of the two highest ranked sites pursuant to this article.
(c) The Governor determines, based on all filings and pleadings, that among the available feasible technologies for transporting and delivering natural gas through a liquefied natural gas process, the technology chosen for a particular site will minimize adverse public health, safety, and environmental impacts.

(a) The commission shall evaluate and rank every proposed LNG terminal pursuant to this article. The evaluation shall meet all of the following requirements:

25571.2.
 (1) Be commenced by January 1, 2006 2007.
(2) Include an evaluation of all applications received by and deemed sufficiently complete by the lead agency for purposes of the commission’s evaluation before January 1, 2006 2007.
(3) Be completed and the results reported to the Governor and the Legislature by April 1, 2006 2007. Notwithstanding Section 7550.5 of the Government Code, the report shall be submitted to the Governor and the Legislature by May 1, 2007.
(b) The commission shall evaluate any LNG terminal application that is received and deemed sufficiently complete by the lead agency for purposes of the commission’s evaluation on or after January 1, 2006 2007, within 90 days from the date the application is deemed sufficiently complete, and shall report the results of that evaluation to the Governor and the Legislature immediately thereafter. Any evaluation completed prior to December 31, 2006 2007, shall include an update of the ranking completed and reported pursuant to subdivision (a).
(c) All documents prepared prior to January 1, 2006 2007, and all evaluations commenced prior to January 1, 2006 2007, and certified as complete by April 1, 2006 2007, shall be sufficient for purposes of this article. Those documents include draft and final environmental impact reports and statements prepared pursuant to the National Environmental Policy Act of 1969 (42 U.S.C. Sec. 4321 et seq.) and the California Environmental Quality Act (Division 13 (commencing with Section 21000)).
(d) The commission shall evaluate and rank each project by using the documents provided by the applicant to comply with the requirements of the federal Deepwater Port Act of 1974 (33 U.S.C. Sec. 1501 et seq.), as amended, and the Federal Energy Regulatory Commission’s licensing authority. Nothing in this section authorizes the commission to request confidential financial or market information from any applicant for purposes of the commission’s evaluation.
(e) The commission shall hold at least two public hearings to consider the results of the LNG terminal evaluation and ranking in order to provide an opportunity for public comment. At least one public hearing shall be held in any county that includes a site that has been evaluated. If the terminal is not proposed to be located within a city or county, the hearings shall be in the city or county nearest the proposed location.
(f) All costs incurred by the commission for the implementation of this article, including costs for any temporary personnel or consultants, shall be funded by fees charged to persons or entities proposing an LNG terminal that is evaluated and ranked pursuant to this article.

25571.4.
 (a) An evaluation and ranking of a facility shall be based on the following criteria:
(1) The extent to which the facility is necessary to meet the future energy needs of California.
(2) The extent to which environmentally less damaging alternatives are feasible to meet California’s future energy needs.
(3) The extent to which a no-build alternative is or is not economically feasible for California’s economy.
(4) The extent to which the facility affects the environment, public health, safety, and welfare, including any disproportionate negative effects upon low‑income or disadvantaged communities.
(5) The extent to which the facility, including supporting infrastructure and resulting ship and air traffic, could impact national security, along with any cumulative impacts upon national security that could result from multiple facilities. Potential impacts on national security include any effect that the facility may have on the land, sea, and airspace identified by the Department of Defense, any of its component armed services, or the United States Coast Guard, for conducting operations, for conducting training, or for the development and testing of weapons, sensors, and tactics.
(6) The economic merits of the respective proposals, including, but not limited to, the reliability and sustainability of the proposed supply.
(b) In conducting the evaluation and ranking, the commission shall consult with all entities of local government that would be affected by a proposed liquefied natural gas terminal, the California Coastal Commission, the State Lands Commission, the Public Utilities Commission, the Office of Emergency Services, the Department of Fish and Game, the State Water Resources Control Board, the affected California regional water quality control board, the State Air Resources Board, the Federal Energy Regulatory Commission, the Department of Defense and its component armed services, and the United States Coast Guard.

25571.8. (a)
 This article does not limit any existing authority of state government pursuant to Division 13 (commencing with Section 21000).
(b) The requirements of this article are applicable to every LNG terminal to be constructed or operating in California, irrespective of whether an application has been submitted for the construction or operation of the terminal to any federal, state, or local entity prior to the operative date of this article.

Article  3. Evaluation of Potential Liquefied Natural Gas Facilities on State Tide and Submerged Lands

The State Lands Commission, or a legislatively designated grantee, shall evaluate and consider applications for a permit to construct and operate liquefied natural gas facilities on state tide or submerged lands within its jurisdiction pursuant to Article 2 (commencing with 25571).