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SB-662 Energy: transportation sector: hydrogen.(2021-2022)

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Date Published: 05/03/2021 10:00 AM
SB662:v96#DOCUMENT

Amended  IN  Senate  May 03, 2021
Amended  IN  Senate  April 19, 2021
Amended  IN  Senate  March 25, 2021

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Senate Bill
No. 662


Introduced by Senator Archuleta

February 19, 2021


An act to amend Sections 740.3 and 740.12 of the Public Utilities Code, relating to energy.


LEGISLATIVE COUNSEL'S DIGEST


SB 662, as amended, Archuleta. Energy: transportation sector: hydrogen.
Existing law, enacted as part of the Clean Energy and Pollution Reduction Act of 2015, requires the Public Utilities Commission (PUC), in consultation with the State Energy Resources Conservation and Development Commission (Energy Commission) and the State Air Resources Board (state board), to direct electrical corporations to file applications for programs and investments to accelerate widespread transportation electrification, as defined, to achieve specified results. The PUC is required to approve, or modify and approve, programs and investments in transportation electrification, including those that deploy charging infrastructure, through a reasonable cost recovery mechanism, if they meet specified requirements.
Existing law requires the PUC, in cooperation with the Energy Commission, the state board, air quality management districts and air pollution control districts, electrical and gas corporations, and the motor vehicle industry, to evaluate and implement policies to promote the development of equipment and infrastructure needed to facilitate the use of electric power and natural gas to fuel low-emission vehicles, as provided.
Existing law requires the state board to adopt hydrogen fuel regulations that ensure that state funding for the production and use of hydrogen fuel contributes to the reduction of greenhouse gas emissions, criteria air pollutant emissions, and toxic air contaminant emissions, and, among things, require that, on statewide basis, no less than 33.3% of the hydrogen produced or dispensed in California for motor vehicles be made from eligible renewable energy resources, as defined.
This bill would require the PUC to additionally evaluate and implement policies to promote the development of equipment and infrastructure needed to facilitate the use of hydrogen to fuel low-emission vehicles, as provided. The bill would require the PUC, in consultation with the state board and the Energy Commission, to authorize gas corporations to file applications for investments in programs to accelerate zero-emission vehicle transportation, defined to include both transportation electrification and the use of hydrogen when it is used as a transportation fuel in fuel cell electric vehicles, to advance specified environmental objectives. The bill would require the PUC to approve, or modify and approve, programs and investments in zero-emission vehicle transportation, including hydrogen and hydrogen-related pipelines, hydrogen distribution, and make-ready infrastructure for hydrogen, using a reasonable cost recovery mechanism if they are consistent with the specified environmental objectives, do not unfairly compete with nonutility enterprises, include performance accountability measures, are in the interest of ratepayers, as defined, and do not result in cost shifts in customer rates or a net increase in emissions from the energy sector as determined by the state board. board, and otherwise meet any applicable renewable or emissions standard or requirement of then existing laws and regulations.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   Local Program: NO  

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


SECTION 1.

 Section 740.3 of the Public Utilities Code is amended to read:

740.3.
 (a) The commission, in cooperation with the Energy Commission, the State Air Resources Board, air quality management districts and air pollution control districts, regulated electrical and gas corporations, and the motor vehicle industry, shall evaluate and implement policies to promote the development of equipment and infrastructure needed to facilitate the use of electricity, hydrogen, and natural gas to fuel low-emission vehicles. Policies to be considered shall include both of the following:
(1) The sale-for-resale and the rate-basing of low-emission vehicles and supporting equipment such as batteries for electric vehicles, make-ready infrastructure for the use of hydrogen as a transportation fuel, and compressor stations for natural gas fueled vehicles.
(2) The development of statewide standards for electric vehicle charger connections and compressed natural gas vehicle fueling connections, including installation procedures and technical assistance to installers.
(b) The commission shall hold public hearings as part of its effort to evaluate and implement the new policies considered in subdivision (a).
(c) The commission’s policies authorizing utilities to develop equipment or infrastructure needed for electricity-powered, including hydrogen fuel cell electricity-powered, and natural gas-fueled low-emission vehicles shall ensure that the costs and expenses of those programs are not passed through to electrical or gas ratepayers unless the commission finds and determines that those programs are in the ratepayers’ interest. The commission’s policies shall also ensure that utilities do not unfairly compete with nonutility enterprises.

SEC. 2.

 Section 740.12 of the Public Utilities Code is amended to read:

740.12.
 (a) (1) The Legislature finds and declares all of the following:
(A) Advanced clean vehicles, including both battery electric and hydrogen fuel cell electric vehicles, and fuels are needed to reduce petroleum use, to meet air quality standards, to improve public health, and to achieve greenhouse gas emissions reduction goals.
(B) Widespread transportation electrification is needed to achieve the goals of the Charge Ahead California Initiative (Chapter 8.5 (commencing with Section 44258) of Part 5 of Division 26 of the Health and Safety Code).
(C) Widespread transportation electrification requires increased access for disadvantaged communities, low- and moderate-income communities, and other consumers of zero-emission and near-zero-emission vehicles, including both battery electric and hydrogen fuel cell electric vehicles, and increased use of those vehicles in those communities and by other consumers to enhance air quality, lower greenhouse gases emissions, and promote overall benefits to those communities and other consumers.
(D) Reducing emissions of greenhouse gases to 40 percent below 1990 levels by 2030 and to 80 percent below 1990 levels by 2050 will require widespread transportation electrification.
(E) Widespread transportation electrification requires electrical corporations to increase access to the use of electricity, and gas utilities to increase access to the use of hydrogen, as a transportation fuel.
(F) Widespread transportation electrification should stimulate innovation and competition, enable consumer options in charging equipment and services, attract private capital investments, and create high-quality jobs for Californians, where technologically feasible.
(G) Deploying electric vehicles should assist in grid management, integrating generation from eligible renewable energy resources, and reducing fuel costs for vehicle drivers who charge in a manner consistent with electrical grid conditions.
(H) Deploying electric vehicle charging infrastructure and increasing the number of hydrogen stations should facilitate increased sales of zero-emission vehicles by making charging and refueling easily accessible and should provide the opportunity to access electricity and hydrogen as a fuel that is cleaner and less costly than gasoline or other fossil fuels in public and private locations.
(I) According to the State Alternative Fuels Plan analysis by the Energy Commission and the State Air Resources Board, light-, medium-, and heavy-duty vehicle electrification results in approximately 70 percent fewer greenhouse gases emitted, over 85 percent fewer ozone-forming air pollutants emitted, and 100 percent fewer petroleum used. These reductions will become larger as renewable generation increases.
(2) It is the policy of the state and the intent of the Legislature to encourage transportation electrification as a means to achieve ambient air quality standards and the state’s climate goals. Agencies designing and implementing regulations, guidelines, plans, and funding programs to reduce greenhouse gas emissions shall take the findings described in paragraph (1) into account.
(b) The commission, in consultation with the State Air Resources Board and the Energy Commission, shall direct electrical corporations to file applications for programs and investments to accelerate widespread transportation electrification to reduce dependence on petroleum, meet air quality standards, achieve the goals set forth in the Charge Ahead California Initiative (Chapter 8.5 (commencing with Section 44258) of Part 5 of Division 26 of the Health and Safety Code), and reduce emissions of greenhouse gases to 40 percent below 1990 levels by 2030 and to 80 percent below 1990 levels by 2050. Programs proposed by electrical corporations shall seek to minimize overall costs and maximize overall benefits. The commission shall approve, or modify and approve, programs and investments in transportation electrification, including those that deploy charging infrastructure, via a reasonable cost recovery mechanism, if they are consistent with this section, do not unfairly compete with nonutility enterprises as required under Section 740.3, include performance accountability measures, and are in the interests of ratepayers as defined in Section 740.8. Not less than 35 percent of the investments pursuant to this subdivision shall be in underserved communities as that term is defined in Section 1601.
(c) (1) For purposes of this subdivision, “zero-emission vehicle transportation” means both transportation electrification, as defined in Section 237.5, and the use of hydrogen when it is used as a transportation fuel in fuel cell electric vehicles.
(2) As part of a separate proceeding from those initiated pursuant to subdivision (b), the commission, in consultation with the State Air Resources Board and the Energy Commission, shall authorize gas corporations to file applications for investments in programs to accelerate zero-emission vehicle transportation to reduce dependence on petroleum, meet air quality standards, and reduce emissions of greenhouse gases to 40 percent below 1990 levels by 2030 and to 80 percent below 1990 levels by 2050. Programs proposed by gas corporations shall seek to minimize overall costs and maximize overall benefits. The commission shall approve, or modify and approve, programs and investments in zero-emission vehicle transportation, including hydrogen and hydrogen-related pipelines, hydrogen distribution, and make-ready infrastructure for hydrogen, via a reasonable cost recovery mechanism if they are consistent with this section, do not unfairly compete with nonutility enterprises, as required by Section 740.3, include performance accountability measures, and are in the interests of ratepayers as defined in Section 740.8.
(3) The commission shall not approve any program or investment pursuant to this subdivision that would result in either any of the following:
(A) Cost shifts in customer rates.
(B) A net increase in emissions from the energy sector, as determined by the State Air Resources Board.
(C) The sale or use of hydrogen as transportation fuel that does not meet any applicable renewable or emissions standard or requirement of then existing laws and regulations.
(d) The commission shall review data concerning current and future electric transportation adoption and charging infrastructure utilization prior to authorizing an electrical corporation to collect new program costs related to transportation electrification in customer rates. If market barriers unrelated to the investment made by an electric corporation prevent electric transportation from adequately utilizing available charging infrastructure, the commission shall not permit additional investments in transportation electrification without a reasonable showing that the investments would not result in long-term stranded costs recoverable from ratepayers.
(e) This Subdivision (b) of this section applies to an application to the commission for transportation electrification programs and investments if one of the following conditions is met:
(1) The application is filed on or after January 1, 2016.
(2) The application is filed before January 1, 2016, but has an evidentiary hearing scheduled on or after July 1, 2016.