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AB-1405 Advanced Digital Network Act.(2017-2018)

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Date Published: 09/08/2017 09:00 PM
AB1405:v94#DOCUMENT

Amended  IN  Senate  September 08, 2017
Amended  IN  Senate  September 01, 2017
Amended  IN  Senate  July 17, 2017
Amended  IN  Assembly  May 02, 2017
Amended  IN  Assembly  March 20, 2017

CALIFORNIA LEGISLATURE— 2017–2018 REGULAR SESSION

Assembly Bill No. 1405


Introduced by Assembly Member Mullin
(Principal coauthor: Senator Skinner)

February 17, 2017


An act to amend Sections 454.52 and 9621 of the Public Utilities Code, relating to energy. An act to add Article 4.6 (commencing with Section 172) to Chapter 1 of Division 1 of the Streets and Highways Code, relating to transportation.


LEGISLATIVE COUNSEL'S DIGEST


AB 1405, as amended, Mullin. Integrated resource plan: peak demand. Advanced Digital Network Act.
Existing law, the Outdoor Advertising Act, provides for the regulation by the Department of Transportation of advertising displays, as defined, within view of public highways.
This bill would enact the Advanced Digital Network Act. The bill would authorize the department, subject to federal approval, to enter into a specified comprehensive development lease agreement pursuant to a best value competitive procurement process for a project with a public or private entity, or a consortia thereof, to install and operate a network of new digital signs within the rights-of-way of the state highway system that would display commercial advertising and public service messages. The bill would authorize the use of the digital signs for emergency messages, as needed, and require dedicated time to be provided to the department to use the advanced digital network for traveler information and motorist safety and awareness campaigns and any other public messaging desired by the state, without providing additional compensation to the contracting entity.
The bill would provide for the contracting entity with which the department has entered into the agreement to contract and receive funds for the placement of commercial advertisements that meet certain standards established by the department. The bill would require revenues derived from the project to be allocated between the department and the contracting entity with which the department has entered into the agreement and would require those revenues received by the department to be deposited in the State Highway Account.
The bill would authorize the department to exercise any power possessed by it with respect to transportation projects to facilitate the project and to adopt guidelines and procedures relative to advertising on the network. The bill would require the department, within one year following the implementation of the project, to submit a specified report to the fiscal and policy committees of the Legislature having jurisdiction over transportation matters.

Existing law requires the Public Utilities Commission to adopt a process for each load-serving entity to file an integrated resource plan and a schedule for periodic updates to the plan to ensure that the load-serving entity meets, among other things, the state’s greenhouse gas emissions reduction targets and the requirement to procure at least 50% of its electricity from eligible renewable resources by December 31, 2030. Existing law requires a local publicly owned electric utility with an annual electrical demand exceeding 700 gigawatthours, on or before January 1, 2019, to adopt an integrated resource plan and a process for updating the plan at least once every 5 years to ensure that the utility satisfies, among other things, the state’s greenhouse gas emissions reduction targets and the requirement to procure at least 50% of its electricity from eligible renewable resources by December 31, 2030.

This bill would require the commission and the governing boards of local publicly owned electric utilities, to consider, as a part of the integrated resource plan process, the role of distributed energy resources and other specified energy-related and efficiency-related tools, in helping to ensure that each load-serving entity or local publicly owned electric utility, as applicable, meets energy needs and reliability needs while reducing the need for new electricity generation resources and new transmission resources in achieving the state’s energy goals at the least cost to ratepayers. Because this bill would impose additional duties on local publicly owned electric utilities, this bill would impose a state-mandated local program.

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 a violation of an order or decision of the commission implementing the bill’s requirements would be a crime, this bill would impose a state-mandated local program by creating a new crime.

This bill would incorporate additional changes to Section 454.52 of the Public Utilities Code proposed by AB 759 to be operative only if this bill and AB 759 are enacted and this bill is enacted last.

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 specified reasons.

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

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


SECTION 1.

 Article 4.6 (commencing with Section 172) is added to Chapter 1 of Division 1 of the Streets and Highways Code, to read:
Article  4.6. Advanced Digital Network Act

172.
 This article shall be known, and may be cited, as the Advanced Digital Network Act.

172.1.
 The Legislature finds and declares all of the following:
(a) Communicating timely information to the traveling public regarding laws, services and events, public service and public health and safety messages, and emergency notifications is an essential public purpose that advances the general health, welfare, and safety of the citizens of California and entities that visit and travel through the state.
(b) California presently makes available on its Internet Web site information regarding laws, services and events, communicates public service and public health and safety messages, and transmits emergency notifications to users of computers, smartphones, and similar online and wireless devices. While this mechanism is effective, it does not provide real-time information to motorists.
(c) Recent advances in technology have made it possible to create a reliable, effective, and comprehensive network of digital signs that combine text with graphics in order to rapidly and clearly communicate important emergency and public service information to the users of California’s highways more safely and effectively than the current methods. This advanced technology digital network would increase the efficacy and reliability of this information transmission by increasing the number and visibility of signs providing emergency and public service information, thereby enhancing the safety and travel experience of the people of California, and function as an extension and improvement of the existing California public information and emergency messaging communication efforts.
(d) The establishment and operation of an advanced digital network should be accomplished at no cost to the state through a public-private partnership, where the private partner erects and operates the network, but is allowed to earn revenues from advertising when signs on the network are not used for public purposes.
(e) Revenues to the state generated by the advanced digital network would provide additional funding for transportation and safety initiatives such as additional highway maintenance and repair, in return for the right to place advertisements on the advanced digital network in a manner that is consistent with, and supports, the network’s safety and public communication functions.
(f) The advanced digital network signs shall be located and installed in accordance with department guidelines for orientation toward motorists on the traveled way and shall have minimal impact outside of those rights-of-way.
(g) The authority to use the advanced digital network for commercial advertising shall require that the advertising and department messaging, when displayed in combination, are determined to be safe and do not create an unsafe distraction to motorists, and is subject to any required prior authorization under federal law.

172.4.
 For purposes of this article, the following terms mean the following:
(a) “Advance digital network” means an integrated network of digital signs. The advanced digital network shall consist of new digital signs at locations as determined by the department.
(b) “Agreement” means a legally enforceable agreement for the project to install and operate an advanced digital network, including, but not limited to, a license, lease, highway improvement agreement, easement, encroachment permit, or operation and maintenance agreement.
(c) “Best value” means a value determined by objective criteria that may include, but are not limited to, revenues to the state, features, experience, functions, life cycle costs, price, the capability to develop and incorporate advanced technologies, and other criteria deemed appropriate by the department.
(d) “Contracting entity or lessee” means a public or private entity, or consortia thereof, that has entered into a comprehensive development lease agreement with the department for a project pursuant to this section.
(e) “Design-build” means a procurement process in which both the design and construction of a project are procured from a single entity.
(f) “Digital sign” means a department-owned or controlled sign or official sign that is designed to display various messages that provide information to the public, as well as advertising, by mechanical or electronic means centrally controlled through a network, including, but not limited to, digital and light-emitting diode (LED) technologies.
(g) “Project” means to study, plan, design, construct, develop, finance, maintain, rebuild, improve, repair, lease, operate, or any combination of these, a state-of-the-art, full-color network of digital signs within the rights-of-way of the state highway system.

172.6.
 (a) Notwithstanding any other law, and subject to any required federal approval authorizing the department to do so, the department may solicit proposals, accept unsolicited proposals, negotiate, and enter into a comprehensive development lease agreement with a public or private entity, or consortia thereof, to conduct a single project, in a manner that best effectuates the purposes of this article, to install and operate new digital signs within the state highway right-of-way, in a manner to best effectuate the purposes of this article. If the department is advised by the United States Department of Transportation, or any of its agencies, that a display of advertising authorized by this article would result in the reduction of federal aid highway funds to the state pursuant to Section 131 of Title 23 of the United States Code, that display of advertising shall not be made. The department shall conduct a best value competitive procurement and negotiate an initial agreement to become effective upon obtaining any necessary federal authorization. The department may provide services for which it is reimbursed with respect to preliminary design, inspection, and oversight of the project.
(b) The agreement shall provide that the contracting entity with which the agreement is entered into will bear all reasonable costs of the project, including, but not limited to, costs of installation, maintenance, and operation of the project.
(c) The agreement described in subdivision (a) shall do all of the following:
(1) Provide for construction, operation, and maintenance of a network of new digital signs at locations selected for the project.
(2) Provide for complete reversion of any ownership interest in any of the privately constructed, improved, operated, and maintained digital signs to the department at the expiration of the agreement at no charge to the department and free and clear of any liens or encumbrances.
(3) Provide that all department emergency notifications shall have priority over other messaging, including advertising.
(4) Provide that the department, in consultation with the Department of the California Highway Patrol, shall retain the ability to make a determination on the safety of the digital signs, and may take those actions deemed necessary to protect public safety.
(5) Require that the agreement entered into pursuant to this section include indemnity, defense, and hold harmless provisions agreed to by the department and the contracting entity, including provisions for indemnifying the State of California against any claims or losses resulting or accruing from the performance of the contracting entity, including advertising on the advanced digital network, excluding any advertising approved in advance or provided by the department.
(6) Provide for the contracting entity with which the agreement is made to contract and receive funds for the placement of commercial advertisements on the advanced digital network, except during times and to the extent the signs are in use by the department and to share revenues generated in connection with the use of those signs for commercial advertising in furtherance of the public interest.
(d) The advanced digital network to be constructed pursuant to this article shall, during the term of the agreement, be deemed to be a part of the state highway system for purposes of identification, maintenance, and enforcement of traffic laws, and part of the state highway system for emergency notification and other public service information purposes and for the purposes of Division 3.6 (commencing with Section 810) of Title 1 of the Government Code.
(e) Revenues from the advanced digital network shall be allocated between the contracting entity with which the agreement is made and the department in accordance with the agreement as provided in paragraph (6) of subdivision (c). Revenue derived from the project and received by the department, or any other revenue generated from advertising on the advanced digital network owned by the department, and received by the department, shall be deposited in the State Highway Account in the State Transportation Fund. This revenue shall not be subject to the transfer under Section 183.1 or any successor to that section. Revenues deposited under this section shall be retained in the State Highway Account, subject to appropriation by the Legislature, consistent with the provisions of any federal authorization.
(f) The digital signs shall meet the design, construction, and operating requirements in the department’s standards and guidelines, including, but not limited to, controls, such as state-of-the-art sensors that control the brightness of the display based on the surrounding ambient light levels and other technologies muting adjacent glare, that focus the zone of vision toward motorists on the traveled way and prevent neighborhood impacts in the vicinity of the digital signs.
(g) The department shall retain the ultimate right to determine whether the location for the placement of a digital sign has or will negatively impact a residential area or community. If the department determines that the location of a digital sign has or will have a negative impact on a residential area or community, the department may, in its discretion, impose additional requirements on its lighting or placement, require a different placement, not allow its placement, or require its removal.
(h) For the purpose of facilitating the project, the agreement between the parties may include provisions for the lease of rights-of-way in, and airspace over or under, highways, public streets, rail, or related facilities, for the granting of necessary easements, and for the issuance of permits or other authorizations to enable the construction of the project. Facilities subject to an agreement under this section shall, at all times, be owned by the department.
(i) The agreement shall require digital signs on the state highway system to meet all requirements for noise mitigation, landscaping, pollution control, and safety that otherwise would apply if the department were designing, building, and operating the project.

172.8.
 The department may exercise any power possessed by it with respect to transportation projects to facilitate the project pursuant to this article. The department may provide services to the contracting entity for which the department is reimbursed, including, but not limited to, planning, environmental planning, environmental certification, environmental review, preliminary design, design, right-of-way acquisition, construction, maintenance, and policing of the project. The department shall regularly inspect the advanced digital network and require the contracting entity to maintain and operate the advanced digital network according to adopted standards. Except as may otherwise be set forth in the agreement, the contracting entity shall be responsible for all costs due to development, maintenance, repair, rehabilitation, and reconstruction, and operating costs.

172.9.
 Advertising on the advanced digital network shall be in the form and under those conditions as may be determined by the department and as may be set forth in standards, guidelines, and procedures adopted by the department. The advertising shall not compromise safety or the department’s safety communication functions. The network shall enhance public messaging, including, but not limited to, safety campaigns, emergency notifications, travel times, and traveler information and the function of the advanced digital network. All digital signs subject to this article shall be exempt from Section 5408 of the Business and Professions Code and from any and all regulations promulgated in connection with Section 5408 of the Business and Professions Code.

173.
 The department shall not enter into an agreement with any contracting entity that would cause or permit any digital sign to display or advertise alcohol, tobacco, firearms, sexually explicit material, political messages or advertisements, or any illegal activity. The department shall adopt policies and guidelines in connection with the content and formatting of the advertising.

173.2.
 The department may use the digital signs for emergency messages, as needed, and dedicated time shall be provided to the department to use the advanced digital network for traveler information and motorist safety and awareness campaigns and any other public service messaging desired by the state, without providing compensation to the contracting entity with which it enters into an agreement pursuant to this article.

173.4.
 (a) When choosing the contracting entity with which to enter into an agreement pursuant to Section 172.6 to effectuate the purposes of this article, the department may utilize, but is not limited to utilizing, one or more of the following procurement approaches:
(1) Solicitations of proposals for defined projects and calls for project proposals within defined parameters.
(2) Prequalification and short-listing of proposers prior to final evaluation of proposals.
(3) Final evaluation of proposals based on qualifications and best value.
(4) Negotiations with proposers prior to award.
(5) Acceptance of unsolicited proposals, with issuance of requests for competing proposals.
(b) When evaluating a proposal submitted by the contracting entity or lessee, the department or the regional transportation agency may award a contract on the basis of best value.
(c) The department may retain a consultant or adviser to assist in preparing the best value criteria, selection of a contracting entity, and oversight of the project. The consultant or adviser shall not bid on the project or, before one year following award of a contract, work as an officer or employee of, or consultant or adviser to, any contracting entity or entities seeking to bid on the project.
(d) The contracting entity shall have the following qualifications:
(1) Evidence that the members of the contracting entity have completed, or have demonstrated the experience, competency, capability, and capacity to complete, a project of similar size, scope, or complexity, and that proposed key personnel have sufficient experience and training to competently manage and complete the design and construction of the project, and a financial statement that ensures that the contracting entity or lessee has the capacity to complete the project.
(2) The licenses, registration, and credentials required to design and construct the project, including, but not limited to, information on the revocation or suspension of any license, credential, or registration.
(3) Evidence that establishes that members of the contracting entity or lessee have the capacity to obtain all required payment and performance bonding, liability insurance, and errors and omissions insurance.
(4) Evidence that the contracting entity or lessee has workers’ compensation experience, history, and a worker safety program of members of the contracting entity or lessee that is acceptable to the department or regional transportation agency.
(5) A full disclosure regarding all of the following with respect to each member of the contracting entity or lessee during the past five years:
(A) Any serious or willful violation of Part 1 (commencing with Section 6300) of Division 5 of the Labor Code or the federal Occupational Safety and Health Act of 1970 (Public Law 91-596).
(B) Any instance in which members of the contracting entity or lessee were debarred, disqualified, or removed from a federal, state, or local governmental public works project.
(C) Any instance where members of the contracting entity, or its owners, officers, or managing employees submitted a bid on a public works project and were found to be nonresponsive or were found by an awarding body not to be a responsible bidder.
(D) Any instance where members of the contracting entity or lessee, or its owners, officers, or managing employees defaulted on a construction contract.
(E) Any violations of the Contractors’ State License Law (Chapter 9 (commencing with Section 7000) of Division 3 of the Business and Professions Code), including, but not limited to, alleged violations of federal or state law regarding the payment of wages, benefits, apprenticeship requirements, or personal income tax withholding, or Federal Insurance Contributions Act (FICA) withholding requirements.
(F) Any bankruptcy or receivership of any member of the contracting entity or lessee, including, but not limited to, information concerning any work completed by a surety.
(G) Any settled adverse claims, disputes, or lawsuits between the owner of a public works project and any member of the contracting entity or lessee during the five years preceding submission of a bid under this article, in which the claim, settlement, or judgment exceeds fifty thousand dollars ($50,000). Information shall also be provided concerning any work completed by a surety during this five-year period.

173.6.
 Within one year following implementation of the project, the department shall submit a report to the fiscal and policy committees of the Legislature with jurisdiction over transportation matters. The report shall include, but not be limited to, all of the following:
(a) The status of implementation of the agreement, including the number of digital signs placed and the locations of the digital signs placed.
(b) The amount of revenue received, cost savings to the department, and the costs incurred by the department with respect to the project, including costs incurred prior to the time the department entered into an agreement.
(c) An assessment of the effect the project has had on public safety, emergency notification, traveler information, and motorist safety and awareness campaigns.
(d) A description of the types of advertising content displayed on the digital signs.

173.8.
 The provisions of this article are severable. If any provision of this article or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.

SECTION 1.Section 454.52 of the Public Utilities Code is amended to read:
454.52.

(a)(1)Commencing in 2017, and to be updated regularly thereafter, the commission shall adopt a process for each load-serving entity, as defined in Section 380, to file an integrated resource plan, and a schedule for periodic updates to the plan, to ensure that load-serving entities do the following:

(A)Meet the greenhouse gas emissions reduction targets established by the State Air Resources Board, in coordination with the commission and the Energy Commission, for the electricity sector and each load-serving entity that reflect the electricity sector’s percentage in achieving the economywide greenhouse gas emissions reductions of 40 percent from 1990 levels by 2030.

(B)Procure at least 50 percent eligible renewable energy resources by December 31, 2030, consistent with Article 16 (commencing with Section 399.11) of Chapter 2.3.

(C)Enable each electrical corporation to fulfill its obligation to serve its customers at just and reasonable rates.

(D)Minimize impacts on ratepayers’ bills.

(E)Ensure system and local reliability.

(F)Strengthen the diversity, sustainability, and resilience of the bulk transmission and distribution systems, and local communities.

(G)Enhance distribution systems and demand-side energy management.

(H)Minimize localized air pollutants and other greenhouse gas emissions, with early priority on disadvantaged communities identified pursuant to Section 39711 of the Health and Safety Code.

(2)(A)The commission may authorize all source procurement for electrical corporations that includes various resource types including demand-side resources, supply side resources, and resources that may be either demand-side resources or supply side resources, taking into account the differing electrical corporations’ geographic service areas, to ensure that each load-serving entity meets the goals set forth in paragraph (1).

(B)The commission may approve procurement of resource types that will reduce overall greenhouse gas emissions from the electricity sector and meet the other goals specified in paragraph (1), but due to the nature of the technology or fuel source may not compete favorably in price against other resources over the time period of the integrated resource plan.

(3)In furtherance of the requirements of paragraph (1), the commission shall consider the role of existing renewable generation, grid operational efficiencies, energy storage, and distributed energy resources, including energy efficiency, in helping to ensure each load-serving entity meets energy needs and reliability needs in hours to encompass the hour of peak demand of electricity, excluding demand met by variable renewable generation directly connected to a California balancing authority, as defined in Section 399.12, while reducing the need for new electricity generation resources and new transmission resources in achieving the state’s energy goals at the least cost to ratepayers.

(b)(1)Each load-serving entity shall prepare and file an integrated resource plan consistent with paragraph (2) of subdivision (a) on a time schedule directed by the commission and subject to commission review.

(2)Each electrical corporation’s plan shall follow the provisions of Section 454.5.

(3)The plan of a community choice aggregator shall be submitted to its governing board for approval and provided to the commission for certification, consistent with paragraph (5) of subdivision (a) of Section 366.2, and shall achieve the following:

(A)Economic, reliability, environmental, security, and other benefits and performance characteristics that are consistent with the goals set forth in paragraph (1) of subdivision (a).

(B)A diversified procurement portfolio consisting of both short-term and long-term electricity and electricity-related and demand reduction products.

(C)The resource adequacy requirements established pursuant to Section 380.

(4)The plan of an electric service provider shall achieve the goals set forth in paragraph (1) of subdivision (a) through a diversified portfolio consisting of both short-term and long-term electricity, electricity-related, and demand reduction products.

(c)To the extent that additional procurement is authorized for the electrical corporation in the integrated resource plan or the procurement process authorized pursuant to Section 454.5, the commission shall ensure that the costs are allocated in a fair and equitable manner to all customers consistent with Section 454.51, that there is no cost-shifting among customers of load-serving entities, and that community choice aggregators may self-provide renewable integration resources consistent with Section 454.51.

(d)In order to eliminate redundancy and increase efficiency, the process adopted pursuant to subdivision (a) shall incorporate, and not duplicate, any other planning processes of the commission.

SEC. 1.5.Section 454.52 of the Public Utilities Code is amended to read:
454.52.

(a)(1)Beginning in 2017, and to be updated regularly thereafter, the commission shall adopt a process for each load-serving entity, as defined in Section 380, to file an integrated resource plan, and a schedule for periodic updates to the plan, to ensure that load-serving entities do the following:

(A)Meet the greenhouse gas emissions reduction targets established by the State Air Resources Board, in coordination with the commission and the Energy Commission, for the electricity sector and each load-serving entity that reflect the electricity sector’s percentage in achieving the economywide greenhouse gas emissions reductions of 40 percent from 1990 levels by 2030.

(B)Procure at least 50 percent eligible renewable energy resources by December 31, 2030, consistent with Article 16 (commencing with Section 399.11) of Chapter 2.3.

(C)Enable each electrical corporation to fulfill its obligation to serve its customers at just and reasonable rates.

(D)Minimize impacts on ratepayers’ bills.

(E)Ensure system and local reliability.

(F)Strengthen the diversity, sustainability, and resilience of the bulk transmission and distribution systems, and local communities.

(G)Enhance distribution systems and demand-side energy management.

(H)Minimize localized air pollutants and other greenhouse gas emissions, with early priority on disadvantaged communities identified pursuant to Section 39711 of the Health and Safety Code.

(2)(A)The commission may authorize all source procurement for electrical corporations that includes various resource types including demand-side resources, supply side resources, and resources that may be either demand-side resources or supply side resources, taking into account the differing electrical corporations’ geographic service areas, to ensure that each load-serving entity meets the goals set forth in paragraph (1).

(B)The commission may approve procurement of resource types that will reduce overall greenhouse gas emissions from the electricity sector and meet the other goals specified in paragraph (1), but due to the nature of the technology or fuel source may not compete favorably in price against other resources over the time period of the integrated resource plan.

(3)In furtherance of the requirements of paragraph (1), the commission shall consider the role of existing renewable generation, grid operational efficiencies, energy storage, and distributed energy resources, including energy efficiency, in helping to ensure each load-serving entity meets energy needs and reliability needs in hours to encompass the hour of peak demand of electricity, excluding demand met by variable renewable generation directly connected to a California balancing authority, as defined in Section 399.12, while reducing the need for new electricity generation resources and new transmission resources in achieving the state’s energy goals at the least cost to ratepayers.

(b)(1)Each load-serving entity shall prepare and file an integrated resource plan consistent with paragraph (2) of subdivision (a) on a time schedule directed by the commission and subject to commission review.

(2)Each electrical corporation’s plan shall follow the provisions of Section 454.5.

(3)The plan of a community choice aggregator shall be submitted to its governing board for approval and provided to the commission for certification, consistent with paragraph (5) of subdivision (a) of Section 366.2, and shall achieve the following:

(A)Economic, reliability, environmental, security, and other benefits and performance characteristics that are consistent with the goals set forth in paragraph (1) of subdivision (a).

(B)A diversified procurement portfolio consisting of both short-term and long-term electricity and electricity-related and demand reduction products.

(C)The resource adequacy requirements established pursuant to Section 380.

(4)The plan of an electric service provider shall achieve the goals set forth in paragraph (1) of subdivision (a) through a diversified portfolio consisting of both short-term and long-term electricity, electricity-related, and demand reduction products.

(c)To the extent that additional procurement is authorized for the electrical corporation in the integrated resource plan or the procurement process authorized pursuant to Section 454.5, the commission shall ensure that the costs are allocated in a fair and equitable manner to all customers consistent with Section 454.51, that there is no cost-shifting among customers of load-serving entities, and that community choice aggregators may self-provide renewable integration resources consistent with Section 454.51.

(d)To eliminate redundancy and increase efficiency, the process adopted pursuant to subdivision (a) shall incorporate, and not duplicate, any other planning processes of the commission.

(e)This section applies to an electrical cooperative, as defined in Section 2776, only if the electrical cooperative has an annual electrical demand exceeding 700 gigawatthours, as determined on a three-year average commencing with January 1, 2013.

SEC. 2.Section 9621 of the Public Utilities Code is amended to read:
9621.

(a)This section shall apply to a local publicly owned electric utility with an annual electrical demand exceeding 700 gigawatthours, as determined on a three-year average commencing January 1, 2013.

(b)On or before January 1, 2019, the governing board of a local publicly owned electric utility shall adopt an integrated resource plan and a process for updating the plan at least once every five years to ensure the utility achieves all of the following:

(1)Meets the greenhouse gas emissions reduction targets established by the State Air Resources Board, in coordination with the commission and the Energy Commission, for the electricity sector and each local publicly owned electric utility that reflect the electricity sector’s percentage in achieving the economywide greenhouse gas emissions reductions of 40 percent from 1990 levels by 2030.

(2)Ensures procurement of at least 50 percent eligible renewable energy resources by 2030 consistent with Article 16 (commencing with Section 399.11) of Chapter 2.3 of Part 1 of Division 1.

(3)Meets the goals specified in subparagraphs (D) to (H), inclusive, of paragraph (1) of subdivision (a) of Section 454.52, and the goal specified in subparagraph (C) of paragraph (1) of subdivision (a) of Section 454.52, as that goal is applicable to each local publicly owned electric utility. A local publicly owned electric utility shall not, solely by reason of this paragraph, be subject to requirements otherwise imposed on electrical corporations.

(c)In furtherance of the requirements of subdivision (b), the governing board of a local publicly owned electric utility shall consider the role of existing renewable generation, grid operational efficiencies, energy storage, and distributed energy resources, including energy efficiency, in helping to ensure each utility meets energy needs and reliability needs in hours to encompass the hour of peak demand of electricity, excluding demand met by variable renewable generation directly connected to a California balancing authority, as defined in Section 399.12, while reducing the need for new electricity generation resources and new transmission resources in achieving the state’s energy goals at the least cost to ratepayers.

(d)(1)The integrated resource plan shall address procurement for the following:

(A)Energy efficiency and demand response resources pursuant to Section 9615.

(B)Energy storage requirements pursuant to Chapter 7.7 (commencing with Section 2835) of Part 2 of Division 1.

(C)Transportation electrification.

(D)A diversified procurement portfolio consisting of both short-term and long-term electricity, electricity-related, and demand response products.

(E)The resource adequacy requirements established pursuant to Section 9620.

(2)(A)The governing board of the local publicly owned electric utility may authorize all source procurement that includes various resource types, including demand-side resources, supply side resources, and resources that may be either demand-side resources or supply side resources, to ensure that the local publicly owned electric utility procures the optimum resource mix that meets the objectives of subdivision (b).

(B)The governing board may authorize procurement of resource types that will reduce overall greenhouse gas emissions from the electricity sector and meet the other goals specified in subdivision (b), but due to the nature of the technology or fuel source may not compete favorably in price against other resources over the time period of the integrated resource plan.

(e)A local publicly owned electric utility shall satisfy the notice and public disclosure requirements of subdivision (f) of Section 399.30 with respect to any integrated resource plan or plan update it considers.

SEC. 3.

Section 1.5 of this bill incorporates amendments to Section 454.52 of the Public Utilities Code proposed by both this bill and Assembly Bill 759. That section of this bill shall only become operative if (1) both bills are enacted and become effective on or before January 1, 2018, (2) each bill amends Section 454.52 of the Public Utilities Code, and (3) this bill is enacted after Assembly Bill 759, in which case Section 1 of this bill shall not become operative.

SEC. 4.

No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because a local agency or school district has the authority to levy service charges, fees, or assessments sufficient to pay for the program or level of service mandated by this act or because 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.