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SB-1215 Electricity: microgrids.(2019-2020)

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Date Published: 06/02/2020 09:00 PM
SB1215:v97#DOCUMENT

Amended  IN  Senate  June 02, 2020
Amended  IN  Senate  May 12, 2020

CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Senate Bill
No. 1215


Introduced by Senator Stern

February 20, 2020


An act to amend Sections 218 and Section 8370 of, and to add Section 8373 to, the Public Utilities Code, relating to electricity.


LEGISLATIVE COUNSEL'S DIGEST


SB 1215, as amended, Stern. Electricity: microgrids.

(1)Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations. Under existing law, “electrical corporation” includes every corporation or person owning, controlling, operating, or managing any electric plant, as defined, for compensation within this state, except as specified.

This bill would exclude from the definition of “electrical corporation” a corporation or person generating electricity from a microgrid, as defined, that includes any component of electric generation that has received specified incentives and that provides electricity to one or more corporations or persons for use on any real property whether or not the portions of real property are adjacent to each other or intervened by a public street.

(2)

(1) Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations. Existing law requires the commission, in consultation with the State Energy Resources Conservation and Development Commission and the Independent System Operator, to take specified actions by December 1, 2020, to facilitate the commercialization of microgrids for distribution customers of large electrical corporations, including developing microgrid service standards necessary to meet state and local permitting requirements and developing methods to reduce barriers for microgrid deployment without shifting costs between ratepayers.

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

The bill would require the commission, in consultation with the Office of Emergency Services, to create a database of critical facilities and critical infrastructure, and related critical circuits, and identify with respect to each whether it serves a high fire-threat district or vulnerable transmission area. The bill would require an electrical corporation to file an application with the commission for approval of any distribution system improvements that are necessary to allow a microgrid project to operate while disconnected from the distribution system, or to allow a critical circuit to disconnect from the distribution system. The bill would require the commission to approve, modify and approve, or deny that application. Because the provisions of this bill may require an order or other action of the commission to implement, and a violation of that order or action would be a crime, this bill would impose a state-mandated local program. corporation, electric service provider, or community choice aggregator, upon request, to collaborate with local governments within its service area to identify critical circuits and microgrid projects. The will would authorize the above listed entities and local publicly owned electric utilities to use capacity resulting from a microgrid project to satisfy specified resource adequacy requirements.

(3)

(2) Existing law requires the commission, in consultation with the Independent System Operator, to establish resource adequacy requirements for electrical corporations, community choice aggregators, and electric service providers.
This bill would require the commission and the Independent System Operator to develop a methodology to account for the resource adequacy value of distributed storage no later than March 31, 2021.

(4)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: YESNO  

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


SECTION 1.

 The Legislature finds and declares all of the following:
(a) Deenergization of electrical infrastructure should be a last resort strategy for wildfire prevention by electrical corporations. Losing power for any extended period of time results in hardship and losses for an impacted community. An electrical corporation should take all necessary steps to ensure that any electricity outage causes minimal disruption to its customers.
(b) Cities, counties, and special districts affected by deenergization events have essential government services shut down during these outages, affecting public health and safety.
(c) Critical facilities and critical infrastructure are vital public resources that serve essential functions. Critical facilities may include law enforcement and emergency response facilities, schools, hospitals, prisons, and major roads, but can also include facilities serving essential needs of a community, including facilities that provide wastewater treatment or health assistance, pharmacies, grocery stores, gas stations, local nonprofit organizations, and emergency shelters. Uninterrupted electrical supply to these facilities is essential in order to maintain public health and safety.
(d) Medically vulnerable electricity customers face unique threats to health and safety during outages. The longer a power shutoff lasts, the more dangerous the consequences can become.
(e) The Office of Emergency Services’ State of California Threat and Hazard Identification and Risk Assessment outlines capability targets for infrastructure systems during defined threats and hazards. Those infrastructure system capability targets include stabilizing critical infrastructure functions, including energy, transportation, telecommunications, water, and wastewater services, and public health and medical systems, within the first 72 hours after an incident. In addition, communities that are in vulnerable transmission areas or in high fire-risk areas should be a priority.
(f) Clean and renewable distributed energy resources, including microgrids, that can disconnect from the grid can serve as a source of electricity for critical loads during emergencies or disruptions in the supply of electricity, thereby reducing the fire risk of providing electrical service, and can improve overall electrical grid resiliency. These same resources in nonemergencies can enhance electrical distribution grid reliability, provide economic benefits, and help the state meet its clean energy and greenhouse gas emissions reduction goals.
SEC. 2.Section 218 of the Public Utilities Code is amended to read:
218.

(a)“Electrical corporation” includes every corporation or person owning, controlling, operating, or managing any electric plant for compensation within this state, except where electricity is generated on or distributed by the producer through private property solely for its own use or the use of its tenants and not for sale or transmission to others.

(b)“Electrical corporation” does not include a corporation or person employing cogeneration technology or producing power from other than a conventional power source for the generation of electricity solely for any one or more of the following purposes:

(1)Its own use or the use of its tenants.

(2)The use of or sale to not more than two other corporations or persons solely for use on the real property on which the electricity is generated or on real property immediately adjacent thereto, unless there is an intervening public street constituting the boundary between the real property on which the electricity is generated and the immediately adjacent property and one or more of the following applies:

(A)The real property on which the electricity is generated and the immediately adjacent real property is not under common ownership or control, or that common ownership or control was gained solely for purposes of sale of the electricity so generated and not for other business purposes.

(B)The useful thermal output of the facility generating the electricity is not used on the immediately adjacent property for petroleum production or refining.

(C)The electricity furnished to the immediately adjacent property is not utilized by a subsidiary or affiliate of the corporation or person generating the electricity.

(3)Sale or transmission to an electrical corporation or state or local public agency, but not for sale or transmission to others, unless the corporation or person is otherwise an electrical corporation.

(c)“Electrical corporation” does not include a corporation or person employing landfill gas technology for the generation of electricity for any one or more of the following purposes:

(1)Its own use or the use of not more than two of its tenants located on the real property on which the electricity is generated.

(2)The use of or sale to not more than two other corporations or persons solely for use on the real property on which the electricity is generated.

(3)Sale or transmission to an electrical corporation or state or local public agency.

(d)“Electrical corporation” does not include a corporation or person employing digester gas technology for the generation of electricity for any one or more of the following purposes:

(1)Its own use or the use of not more than two of its tenants located on the real property on which the electricity is generated.

(2)The use of or sale to not more than two other corporations or persons solely for use on the real property on which the electricity is generated.

(3)Sale or transmission to an electrical corporation or state or local public agency, if the sale or transmission of the electricity service to a retail customer is provided through the transmission system of the existing local publicly owned electric utility or electrical corporation of that retail customer.

(e)“Electrical corporation” does not include an independent solar energy producer, as defined in Article 3 (commencing with Section 2868) of Chapter 9 of Part 2.

(f)(1)“Electrical corporation” does not include a corporation or person generating electricity from a microgrid that includes any component of electric generation that has received an incentive for the installation of energy storage and other eligible distributed energy resources from the self-generation incentive program pursuant to Section 379.9 or an award from the Electric Program Investment Charge program pursuant to Section 25711.5 of the Public Resources Code, and that provides electricity to one or more corporations or persons for use on any real property whether or not the portions of real property are adjacent to each other or intervened by a public street.

(2)For purposes of this section, “microgrid” has the same meaning as in Section 8370.

(g)The amendments made to this section at the 1987 portion of the 1987–88 Regular Session of the Legislature do not apply to any corporation or person employing cogeneration technology or producing power from other than a conventional power source for the generation of electricity that physically produced electricity prior to January 1, 1989, and furnished that electricity to immediately adjacent real property for use thereon prior to January 1, 1989.

SEC. 3.SEC. 2.

 Section 8370 of the Public Utilities Code is amended to read:

8370.
 For purposes of this chapter, the following definitions shall apply:
(a) “Access and functional needs population” has the same meaning as defined in Section 8593.3 of the Government Code.
(b) “Community choice aggregator” has the same meaning as defined in Section 331.1.
(c) “Critical circuit” means an electrical circuit that supplies electricity to one or more critical facilities or to critical infrastructure, as reported to the commission by each electrical corporation.
(d) “Critical customer” means a customer of an electrical corporation receiving a medical baseline allowance pursuant to Section 739 who resides within a high fire-threat district or vulnerable transmission area, or a customer of a local publicly owned electric utility enrolled in a life support discount program who resides within a high fire-threat district or vulnerable transmission area.
(e) “Critical facilities and critical infrastructure” means facilities and infrastructure that are essential to health and public safety that require assistance and advance planning to ensure their resiliency during a deenergization event, as reported to the commission by the Office of Emergency Services based on consultations with local governments, including, but not limited to, facilities and infrastructure within the United States Department of Homeland Security’s critical infrastructure sectors.
(f) “Customer” means a customer of a local publicly owned electric utility or of a large electrical corporation. A person or entity is a customer of a large electrical corporation if the customer is physically located within the service territory of the large electrical corporation and receives bundled service, distribution service, or transmission service from the large electrical corporation.
(g) “Distributed energy resource” means an electric generation or storage technology that complies with the emissions standards adopted by the State Air Resources Board pursuant to the distributed generation certification program requirements of Section 94203 of Title 17 of the California Code of Regulations, or any successor regulation.
(h) “High fire-threat district” means a geographic area identified by the commission as a Tier II or Tier III fire-threat area, where there is an elevated or extreme risk for fires caused by electrical infrastructure igniting and spreading rapidly.
(i) “Large electrical corporation” means an electrical corporation with more than 100,000 service connections in California.
(j) “Local government” means a city, county, or city and county.
(k) “Microgrid” means an interconnected system of loads and energy resources, including, but not limited to, distributed energy resources, energy storage, demand response tools, or other management, forecasting, and analytical tools, appropriately sized to meet customer needs, within a clearly defined electrical boundary that can act as a single, controllable entity, and can connect to, disconnect from, or run in parallel with, larger portions of the electrical grid, or can be managed and isolated to withstand larger disturbances and maintain electrical supply to connected critical infrastructure.
(l) “Project” means a microgrid project that meets the resiliency needs of a local government, joint powers authority, or special district and may include microgrid projects that meet the resiliency needs for critical facilities and critical infrastructure, critical customers, or customers from an access and functional needs population that can operate disconnected from the distribution system for a predetermined period of time.
(m) “Resiliency” means the ability to mitigate and recover from an electrical service disruption using generation resources that maintain all or essential electrical service to customers, including critical facilities and critical infrastructure. Electrical service disruptions include, but are not limited to, emergencies, natural disasters, planned or unplanned electricity outages, or other events that may cause disruptions to important public services.
(n) “Vulnerable transmission area” means a geographic area likely to experience a loss of electrical service from a planned deenergization event caused by an increased fire risk from electrical infrastructure located within a high fire-threat district.

SEC. 4.SEC. 3.

 Section 8373 is added to the Public Utilities Code, to read:

8373.
 (a) (1) The commission, in consultation with the Office of Emergency Services, shall create a database of critical facilities and critical infrastructure, and related critical circuits, and identify with respect to each whether it serves a high fire-threat district or vulnerable transmission area, including whether it serves low-income and disadvantaged communities within a high fire-threat district or vulnerable transmission area.
(2) An electrical corporation shall collaborate upon request with local governments within its service area to identify critical circuits and microgrid projects.

(b)(1)Eligible distributed energy resources procured for a microgrid project may be used by an electrical corporation, electric service provider, or community choice aggregator to satisfy its renewables portfolio standard procurement requirements established pursuant to Sections 399.15 and 399.16, and may be used by a local publicly owned electric utility to meet its requirements pursuant to Section 399.30.

(2)(A)

(b) (1) An electrical corporation, electric service provider, or community choice aggregator may use capacity resulting from a microgrid project to satisfy the resource adequacy requirements established in Section 380 and a local publicly owned electric utility may use that capacity to satisfy its resource adequacy requirements pursuant to Section 9620.

(B)

(2) The commission and the Independent System Operator shall develop a methodology to account for the resource adequacy value of distributed storage no later than March 31, 2021.

(c)(1)An electrical corporation shall file an application with the commission for approval of any distribution system improvements that are necessary to allow a microgrid project to operate while disconnected from the distribution system, or to allow a critical circuit to disconnect from the distribution system. An electrical corporation shall be responsible for any upgrades to the distribution system necessary to allow a critical circuit to disconnect from the distribution system.

(2)The commission shall approve, modify and approve, or deny an application submitted pursuant to paragraph (1).

SEC. 5.

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.