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SB-515 Public Utilities Commission: high hazard zone fuel: report.(2019-2020)

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Date Published: 07/02/2019 09:00 PM
SB515:v96#DOCUMENT

Amended  IN  Assembly  July 02, 2019
Amended  IN  Senate  April 08, 2019
Amended  IN  Senate  March 25, 2019

CALIFORNIA LEGISLATURE— 2019–2020 REGULAR SESSION

Senate Bill
No. 515


Introduced by Senator Caballero
(Principal coauthor: Senator Nielsen)
(Coauthor: Senator Galgiani)
(Coauthors: Assembly Members Dahle and Gallagher) Dahle, Gallagher, and Quirk)

February 21, 2019


An act to amend Section 399.20.3 of the Public Utilities Code, relating to energy.


LEGISLATIVE COUNSEL'S DIGEST


SB 515, as amended, Caballero. California Renewables Portfolio Standard Program: bioenergy renewable feed-in tariff. Public Utilities Commission: high hazard zone fuel: report.
Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations. Existing law requires each electrical corporation, local publicly owned electric utility, and electrical cooperative to construct, maintain, and operate its electrical lines and equipment in a manner that will minimize the risk of catastrophic wildfire posed by those electrical lines and equipment. Existing law requires each electrical corporation to annually prepare a wildfire mitigation plan and to submit its plan to the commission for review and approval, as specified. Existing law requires that an electrical corporation’s wildfire mitigation plan include plans for vegetation management. Existing law requires the commission and the Department of Forestry and Fire Protection to enter into a memorandum of understanding to cooperatively develop consistent approaches and share data related to fire prevention, safety, vegetation management, and energy distribution system.
This bill would require the commission to submit a report to the appropriate policy committees of the Legislature on or before January 6, 2020, that contains specified information relating to high hazard zone fuel.

Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations. The California Renewables Portfolio Standard Program requires the commission to establish a renewables portfolio standard requiring all retail sellers, including electrical corporations, to procure a minimum quantity of electricity products from eligible renewables energy resources, as defined, so that the total kilowatthours of those products sold to their retail end-use customers achieves 25% of retail sales by December 31, 2016, 33% by December 31, 2020, 44% by December 31, 2024, 52% by December 31, 2027, and 60% by December 31, 2030. The program requires electrical corporations, by December 1, 2016, to collectively procure, through 5-year financial commitments, their proportionate share of 125 megawatts of cumulative rated generating capacity from bioenergy projects that commenced operation prior to June 1, 2013, and that each produces its generation using specified minimum percentages of certain types of forest feedstock. Pursuant to existing law, the commission has adopted resolutions establishing fuel or feedstock procurement requirements for generation from bioenergy projects intended to reduce wildfire risks that are applicable to the state’s 3 largest electrical corporations.

This bill would expand the fuels and feedstocks that are eligible to meet these wildfire risk reduction fuel and feedstock requirements to include biomass diverted from specified higher fire-risk zones.

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

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


SECTION 1.

 The Public Utilities Commission shall submit a report to the appropriate policy committees of the Legislature on or before January 6, 2020, that contains all of the following:
(a) The amount of high hazard zone vegetation eligible for removal.
(b) An assessment of the overall market potential for high hazard zone fuel in California.
(c) An assessment of the potential high hazard zone fuel supply for each current Biofuel Renewable Auction Mechanism (BioRAM) contract.
SECTION 1.Section 399.20.3 of the Public Utilities Code is amended to read:
399.20.3.

(a)For purposes of this section, the following definitions apply:

(1)“Bioenergy” has the same meaning as set forth in paragraph (4) of subdivision (f) of Section 399.20.

(2)“Tier 1 high hazard zone” includes areas where wildfire and falling trees threaten power lines, roads, and other evacuation corridors, critical community infrastructure, or other existing structures, as designated by the Department of Forestry and Fire Protection pursuant to the Proclamation of a State of Emergency on Tree Mortality declared by the Governor on October 30, 2015.

(3)“Tier 2 high hazard zone” includes watersheds that have significant tree mortality combined with community and natural resource assets, as designated by the Department of Forestry and Fire Protection pursuant to the Proclamation of a State of Emergency on Tree Mortality declared by the Governor on October 30, 2015.

(b)In addition to the requirements of subdivision (f) of Section 399.20, by December 1, 2016, electrical corporations shall collectively procure, through financial commitments of five years, their proportionate share of 125 megawatts of cumulative rated generating capacity from existing bioenergy projects that commenced operations prior to June 1, 2013. At least 80 percent of the feedstock of an eligible facility, on an annual basis, shall be a byproduct of sustainable forestry management, which includes removal of dead and dying trees from Tier 1 and Tier 2 high hazard zones and is not that from lands that have been clear cut. At least 60 percent of this feedstock shall be from Tier 1 and Tier 2 high hazard zones.

(c)For the purpose of contracts entered into pursuant to subdivision (b), commission Resolution E-4770 (March 17, 2016), and commission Resolution E-4805 (October 13, 2016), Tier 1 and Tier 2 high hazard zone fuel or feedstock shall also include biomass fuels removed from fuel reduction operations exempt from timber harvesting plan requirements pursuant to subdivisions (a), (f), (j), and (k) of Section 4584 of the Public Resources Code, biomass diverted from very high fire threat zones designated on the most recent version of the Department of Forestry and Fire Protection’s Fire Hazard Severity Zone Map, and biomass diverted from a commission-approved Tier 3 High Fire-Threat District, all of which shall count toward the mandatory fuel requirement.

(d)The commission shall require an electrical corporation that has entered into a contract pursuant to subdivision (b), commission Resolution E-4770 (March 17, 2016), or commission Resolution E-4805 (October 13, 2016) to allow fuel or feedstock reporting requirements to be based on a monthly or annual basis, and a bioenergy facility providing generation pursuant to that contract shall have the right to opt out of the mandated fuel or feedstock usage levels in any particular month upon providing written notice to the electrical corporation in the month of operation. For months in which a bioenergy facility opts out of the mandated fuel or feedstock usage levels or misses the mandated fuel or feedstock targets, that facility shall be paid the alternate price adopted by the commission in commission Resolution E-4770 (March 17, 2016) for all megawatthours generated during that month. Contracts shall continue in force through the end of the contracted term without creating an event of default for missing mandated fuel or feedstock usage levels and without giving rise to a termination right in favor of the electrical corporation.

(e)(1)For each electrical corporation, the commission shall allocate its proportionate share of the 125 megawatts based on the ratio of the electrical corporation’s peak demand to the total statewide peak demand.

(2)Procurement by an electrical corporation of generation capacity pursuant to a contract under the commission’s Resolution E-4770 (March 17, 2016) that is in excess of the requirement of that electrical corporation under that resolution shall count towards meeting the electrical corporation’s proportionate share allocated pursuant to paragraph (1).

(f)The commission may direct each electrical corporation to develop standard contract terms and conditions that reflect the operational characteristics of the bioenergy projects and to provide a streamlined contracting process or may require the electrical corporations to use the mechanism established pursuant to the commission’s Resolution E-4770 (March 17, 2016) to meet the requirements of subdivision (e). The procurement pursuant to the developed standard contract shall occur on an expedited basis due to the Proclamation of a State of Emergency on Tree Mortality declared by the Governor on October 30, 2015.

(g)A local publicly owned electric utility serving more than 100,000 customers shall procure its proportionate share, based on the ratio of the utility’s peak demand to the total statewide peak demand, of 125 megawatts of cumulative rated capacity from existing bioenergy projects described in subdivision (b) subject to terms of at least five years.

(h)The commission shall ensure that the costs of any contract procured by an electrical corporation to satisfy the requirements of this section are recoverable from all customers on a nonbypassable basis.

(i)The Procurement Review Group within the commission shall advise the commission on the cost of the generation procured pursuant to this section and its impact on ratepayers.