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SB-324 Electricity: private energy producers: Hetch Hetchy Water and Power solar generation.(2007-2008)

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Amended  IN  Assembly  July 02, 2007
Amended  IN  Senate  April 17, 2007

CALIFORNIA LEGISLATURE— 2007–2008 REGULAR SESSION

Senate Bill
No. 324

Introduced  by  Senator Migden
Laird

February 16, 2007

An act to amend Section 2852 Sections 2802 and 2828 of the Public Utilities Code, relating to public utilities. energy.


LEGISLATIVE COUNSEL'S DIGEST


SB 324, as amended, Migden. Electricity: solar energy: low-income residential housing. private energy producers: Hetch Hetchy Water and Power solar generation.

Under

(1) Under existing law, the Public Utilities Commission (PUC) has regulatory authority over public utilities, including electrical corporations and gas corporations, as defined. A decision of the PUC adopted the California Solar Initiative under which the PUC will oversee a program to promote solar energy technologies, administered by electrical corporations and gas corporations, for commercial and residential customers, funded through electrical corporation and gas corporation revenues and collected from gas and electric utility distribution rates. Existing law requires the PUC to ensure that not less than 10% of the funds for the California Solar Initiative are utilized for the installation of solar energy systems, as defined, on low-income residential housing, as defined, and authorizes the PUC to incorporate a revolving loan or loan guarantee program into the California Solar Initiative for low-income residential housing. Existing law permits a private energy producer, as defined, to generate electricity not generated from conventional sources, as defined, solely for his or its own use or the use of his or its tenants, or generating electricity to or for any electrical or heat corporation, state agency, city, county, district, or an association thereof, but not the public, without becoming a public utility subject to the general jurisdiction of the commission.
Existing law authorizes a community choice aggregator to aggregate the electrical load of interested electricity consumers within its boundaries, requires a community choice aggregator to file an implementation plan with the commission, and requires the commission to notify an electrical corporation serving the customers proposed for aggregation that an implementation plan initiating community choice aggregation has been filed, within 10 days of the filing.
This bill would authorize a private energy producer to generate electricity not generated from conventional sources for a community choice aggregator.
(2) Existing law authorizes the City and County of San Francisco to elect to designate specific photovoltaic electricity generation facilities meeting specified conditions as Hetch Hetchy Water and Power (HHWP) solar generation facilities, and upon election and the filing and acceptance of an advice letter with the commission establishing rates, Pacific Gas and Electric Company (PG&E) is required on a monthly basis, to credit the City and County of San Francisco for certain electricity generated and delivered to the electric grid by HHWP at-site solar generation and HHWP remote solar generation in accordance with specified rate criteria.
This bill, instead, would authorize the City and County of San Francisco to elect to designate specific solar electricity generation facilities pursuant to the above-described authorization and would provide that the authorization does not limit the right of HHWP to sell electricity from a solar generation facility owned by the City and County of San Francisco when otherwise authorized by law.

This bill would expand that definition of low-income residential housing to include residential housing that is wholly occupied by individuals enrolled in the commission’s California Alternative Rates for Energy (CARE) program, Low-Income Energy Efficiency (LIEE) program, or Family Electric Rate Assistance (FERA) program.

The bill would also require the PUC to ensure that lower income households, as defined, and individuals enrolled in the programs referenced above are the primary beneficiaries of cost savings and power benefits of solar energy systems installed on low-income residential housing.

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

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


SECTION 1.

 Section 2802 of the Public Utilities Code is amended to read:

2802.
 “Private energy producer” includes every person, corporation, city, county, district, and public agency of the state generating or producing electricity not generated from conventional sources or natural gas for energy either directly or as a byproduct solely for his or its own use or the use of his or its tenants; or generating or producing electricity, or owning the means thereof, to or for any electrical corporation, heat corporation, community choice aggregator, state agency, city, county, district, or an association thereof, but not to or for the public for any other purpose. Notwithstanding any other provision of law, a private energy producer shall not be found to be a public utility subject to the general jurisdiction of the commission solely because of conducting any activity authorized by this chapter.

SEC. 2.

 Section 2828 of the Public Utilities Code is amended to read:

2828.
 (a) As used in this section, the following terms have the following meanings:
(1) “Appropriate TOU tariff” means the Time-of-Use tariff that would be applicable to the City and County of San Francisco account at the photovoltaic solar electricity generation facility site if the facility at the site were a Pacific Gas and Electric Company bundled customer, as determined by Pacific Gas and Electric Company. customer.
(2) “Environmental attributes” associated with the Hetch Hetchy Water and Power (HHWP) at-site solar generation and HHWP remote solar generation include, but are not limited to, the credits, benefits, emissions reductions, environmental air quality credits, and emissions reduction credits, offsets, and allowances, however entitled, resulting from the avoidance of the emissions of any gas, chemical, or other substance attributable to the Hetch Hetchy Water and Power photovoltaic solar electricity generation facility owned by the City and County of San Francisco.
(3) “HHWP at-site solar generation” means the electricity generated by Hetch Hetchy Water and Power photovoltaic solar electricity generation facilities owned by the City and County of San Francisco, designated by the City and County of San Francisco pursuant to subdivision (b).
(4) “HHWP remote solar generation” means the electricity generated by Hetch Hetchy Water and Power photovoltaic solar electricity generation facilities owned by the City and County of San Francisco, designated by the City and County of San Francisco pursuant to subdivision (h), to provide electricity to qualifying remote load.
(5) “Interconnection Agreement” means the 1987 agreement between Pacific Gas and Electric Company and the City and County of San Francisco, as filed with and accepted by the Federal Energy Regulatory Commission (FERC), and as amended from time to time with FERC approval, which provides for rates for transmission, distribution, and sales of supplemental electricity to the City and County of San Francisco. Nothing in this section shall waive or modify the rights of parties under the Interconnection Agreement or the jurisdiction of the FERC over rates set forth in the Interconnection Agreement.
(6) “Qualifying remote load” means the electricity demand of the City and County of San Francisco for load served under the Interconnection Agreement, at sites that are separate from, and not adjacent to, the sites where the photovoltaic solar electricity generation facility is located, and serviced through a meter or multiple meters other than those serving the sites where the photovoltaic solar electricity generation facility is located. The separate or remote sites may be designated by the City and County of San Francisco, both inside and outside of the City and County of San Francisco. Where the separate or remote sites are outside of the City and County of San Francisco, they shall be located within 20 miles of the City and County of San Francisco or within 20 miles of a HHWP remote solar generation facility. There is no wattage limit on qualifying remote load.
(b) The City and County of San Francisco may elect to designate specific photovoltaic solar electricity generation facilities as HHWP at-site solar generation, if all of the following conditions are met:
(1) Total peak generating capacity does not exceed 15 megawatts.
(2) The photovoltaic solar electricity generation facility utilizes a meter, or multiple meters, capable of separately measuring electricity flow in both directions. All meters shall provide “time-of-use” measurement information. If the existing meter at the site of the facility is not capable of providing time-of-use information or is not capable of separately measuring total flow of energy in both directions, the City and County of San Francisco is responsible for all expenses involved in purchasing and installing a meter or meters that are both capable of providing time-of-use information and able to separately measure total electricity flow in both directions.
(3) The amount of all electricity delivered to the electric grid by the designated HHWP at-site solar generation is the property of Pacific Gas and Electric Company an electrical corporation, local publicly owned electric utility, community choice aggregator, or electric service provider providing electric service for the qualifying remote load.
(4) The City and County of San Francisco does not sell electricity delivered to the electric grid from the designated HHWP at-site solar generation to a third party.
(c) For each site of a photovoltaic solar electricity generation facility that comprises the HHWP at-site solar generation, Pacific Gas and Electric Company shall identify the appropriate TOU tariff for that site. Any electricity exported to the Pacific Gas and Electric Company grid at that site that is not generated from HHWP remote solar generation pursuant to subdivision (h) shall, for each time-of-use period, result in a monetary credit to be applied monthly as a credit or offset against the invoice created pursuant to the Interconnection Agreement and shall be valued at the generation component of the appropriate TOU tariff. The commission shall determine if it is appropriate to increase the credit to reflect any additional value derived from the location or the environmental attributes of, the designated HHWP at-site solar generation.
(d) Monthly charges and credit amounts for HHWP at-site solar generation are interim and subject to an accounting true-up, consistent with commission policies and practices. The true-up shall be performed annually or upon the termination, for any reason, of the Interconnection Agreement. The true-up shall accomplish the following:
(1) If the total electricity delivered to the site by Pacific Gas and Electric Company since the previous true-up equals or exceeds the total electricity exported to the grid by the HHWP at-site solar generation facility at the site, the City and County of San Francisco is a net electricity consumer at that site. For any HHWP at-site solar generation site where the City and County of San Francisco is a net electricity consumer, a credit or offset shall be applied to reduce the obligations of the City and County of San Francisco to an invoice prepared pursuant to the Interconnection Agreement. If there is no invoiced obligation to be reduced, there is no applicable credit.
(2) If the total electricity delivered to the site by Pacific Gas and Electric Company since the previous true-up is less than the total electricity exported to the grid by the HHWP at-site solar generation facility at the site, the City and County of San Francisco is a net electricity producer at that site. For any HHWP at-site solar generation site where the City and County of San Francisco is a net electricity producer, the City and County of San Francisco shall receive no credit or offset for the electricity exported to the grid in excess of the electricity delivered to the site from the grid. For any site where the City and County of San Francisco is a net electricity producer, the City and County of San Francisco shall receive a credit or offset up to the amount of electricity delivered to the site from the grid. The credit or offset shall be applied to reduce the obligations of the City and County of San Francisco to an invoice prepared pursuant to the Interconnection Agreement. If there is no invoiced obligation to be reduced, there is no applicable credit or offset. Pacific Gas and Electric Company shall use the last-in, first-out method to determine what electricity delivered to the grid from the site will not earn a credit or offset.
(e) Pursuant to this section, the offset to charges under the Interconnection Agreement is the medium to convey credits earned under this section. Nothing in this section shall be construed to affect in any way the rights and obligations of the City and County of San Francisco and Pacific Gas and Electric Company under the Interconnection Agreement. If the Interconnection Agreement terminates, the City and County of San Francisco and Pacific Gas and Electric Company shall develop an alternative mechanism to convey credits earned under this section, in a manner that accomplishes the same result as that accomplished pursuant to the Interconnection Agreement.
(f) (1) Pacific Gas and Electric Company shall file an advice letter with the commission, that complies with this section, not later than 10 days after the City and County of San Francisco first designates the specific photovoltaic solar electricity generation facilities that will comprise HHWP at-site solar generation.
(2) The commission, within 30 days of the date of filing of the advice letter, shall approve the advice letter or specify conforming changes to be made by Pacific Gas and Electric Company to be filed in an amended advice letter within 30 days.
(g) The City and County of San Francisco may terminate its election pursuant to subdivisions (b), (c), (d), and (h), upon providing Pacific Gas and Electric Company with a minimum of 60 days’ written notice.
(h) (1) The City and County of San Francisco may elect to designate specific photovoltaic solar electricity generation facilities as HHWP remote solar generation and may use HHWP remote solar generation to supply electricity to specific facilities designated as qualifying remote load up to the amount of electricity being used by the qualifying remote load.
(2) The City and County of San Francisco shall receive no credit or offset for the electricity exported to the grid from HHWP remote solar generation, in excess of the electricity delivered from the grid to qualifying remote load.
(3) Pacific Gas and Electric Company shall accept any electricity exported to the grid by HHWP remote solar generation, up to the amount of electricity contemporaneously being used by the qualifying remote load, and treat the electricity accepted as behind the meter generation that offsets the electrical usage of qualifying remote load. Additional rates may apply pursuant to paragraph (6).
(4) The City and County of San Francisco shall be responsible for scheduling the electricity exported to the grid from HHWP remote solar generation.
(5) Both HHWP remote solar generation sites and qualifying remote load sites shall have meters capable of measuring exports and usage of electricity that will support determination of credits or offsets pursuant to paragraph (2). The City and County of San Francisco shall be responsible for the costs of the meters required pursuant to this section.
(6) To compensate Pacific Gas and Electric Company for the use of its facilities, the City and County of San Francisco shall pay applicable distribution rates, transmission rates, or distribution and transmission rates, at rate levels determined by the Interconnection Agreement, for all energy delivered to qualifying remote load that comes from HHWP remote solar generation. When HHWP remote solar generation and the qualifying remote load it serves are located within the City and County of San Francisco and are interconnected at distribution voltage, the applicable rate for delivery of energy from HHWP remote solar generation shall be reduced as negotiated pursuant to the Interconnection Agreement.
(7) The appropriate regulatory agency shall ensure that the delivery of electricity by HHWP remote solar generation to qualifying remote load, and the granting of offsets to the City and County of San Francisco pursuant to this subdivision, do not result in a shifting of costs to bundled service customers, either immediately or over time.
(i) Hetch Hetchy Water and Power shall reimburse Pacific Gas and Electric Company for its reasonable study costs associated with HHWP remote solar generation to address interconnection, consistent with applicable regulatory rules, and impacts upon the electric system resulting from the HHWP remote solar generation. If the studies identify improvements necessary for the protection of the Pacific Gas and Electric Company electric system, for the protection of its employees, or to ensure reliable delivery of the electricity generated by the HHWP remote solar generation facility to qualifying remote load, Hetch Hetchy Water and Power shall pay the reasonable costs of the improvements if it elects to designate the HHWP remote solar generation facility to provide electricity for qualifying remote load.
(j) Ownership and use of the environmental attributes associated with the electricity delivered to the electric grid by HHWP at-site solar generation and HHWP remote solar generation shall be determined by the commission in accordance with Article 16 (commencing with Section 399.11) of Chapter 2.3 of Part 1.
(k) Nothing in this section limits the right of HHWP to sell electricity from a solar generation facility owned by the City and County of San Francisco when otherwise authorized by law.

SEC. 3.

 The Legislature finds and declares that, because of the unique circumstances applicable only to Hetch Hetchy Water and Power solar generation of electricity, a statute of general applicability cannot be enacted within the meaning of subdivision (b) of Section 16 of Article IV of the California Constitution. Therefore, this special statute is necessary.
SECTION 1.Section 2852 of the Public Utilities Code is amended to read:
2852.

(a)As used in this section, the following terms have the following meanings:

(1)“California Solar Initiative” means the program providing ratepayer funded incentives for eligible solar energy systems adopted by the Public Utilities Commission in Decision 05-12-044 and Decision 06-01-024.

(2)“Low-income residential housing” means any of the following:

(A)Residential housing financed with low-income housing tax credits, tax-exempt mortgage revenue bonds, general obligation bonds, or local, state, or federal loans or grants, and for which the rents of the occupants who are lower income households, as defined in Section 50079.5 of the Health and Safety Code, do not exceed those prescribed by deed restrictions or regulatory agreements pursuant to the terms of the financing or financial assistance.

(B)A residential complex in which at least 20 percent of the total units are sold or rented to lower income households, as defined in Section 50079.5 of the Health and Safety Code, and the housing units targeted for lower income households are subject to a deed restriction or affordability covenant with a public entity that ensures that the units will be available at an affordable housing cost, as defined in Section 50052.5 of the Health and Safety Code, or at an affordable rent, as defined in Section 50053 of the Health and Safety Code for a period of at least 30 years.

(C)Residential housing that is wholly occupied by individuals enrolled in the commission’s California Alternative Rates for Energy (CARE) program, Low-Income Energy Efficiency (LIEE) program, or Family Electric Rate Assistance (FERA) program.

(3)“Solar energy system” means a solar energy device that has the primary purpose of providing for the collection and distribution of solar energy for the generation of electricity, that produces at least one kilowatt, and except for a solar energy device for a nonprofit building, produces not more than five megawatts, alternating current rated peak electricity, and that meets or exceeds the eligibility criteria established by the commission or the State Energy Resources Conservation and Development Commission.

(b)In establishing the California Solar Initiative, no moneys shall be diverted from any existing programs for low-income ratepayers, or from cost-effective energy efficiency or demand response programs.

(c)(1)The commission shall ensure that not less than 10 percent of the funds for the California Solar Initiative are utilized for the installation of solar energy systems on low-income residential housing. Notwithstanding any other law, the commission may modify the monetary incentives made available pursuant to the California Solar Initiative to accommodate the limited financial resources of low-income residential housing.

(2)No later than January 1, 2009, the commission shall ensure that lower income households, as defined in Section 50079.5 of the Health and Safety Code, and those individuals enrolled in the programs described in subparagraph (C) of paragraph (2) of subdivision (a) are the primary beneficiaries of cost savings and power benefits of solar energy systems installed on low-income residential housing. The commission shall do all of the following to implement this requirement:

(A)Maximize incentives to properties that are committed to continuously serving the needs of lower income households, as defined in Section 50079.5 of the Health and Safety Code, and those individuals enrolled in the programs described in subparagraph (C) of paragraph (2) of subdivision (a).

(B)Establish income verification procedures and requirements.

(C)Establish conditions on the installation of solar energy systems, including property ownership restrictions and income rental protections, and appropriate enforcement of these conditions.

(3)The commission may incorporate a revolving loan or loan guarantee program into the California Solar Initiative for low-income residential housing. All loans outstanding as of January 1, 2016, shall continue to be repaid consistent with the terms and conditions of the program adopted and implemented by the commission pursuant to this subdivision, until repaid in full.

(4)All moneys set aside for the purpose of funding the installation of solar energy systems on low-income residential housing that are unexpended and unencumbered on January 1, 2016, and all moneys thereafter repaid pursuant to paragraph (3), except to the extent those moneys are encumbered pursuant to this section, shall be utilized to augment existing cost-effective energy efficiency measures in low-income residential housing that benefit ratepayers.