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SB-646 Electricity: integrated resource planning.(2021-2022)

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Date Published: 03/10/2021 09:00 PM
SB646:v98#DOCUMENT

Amended  IN  Senate  March 10, 2021

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Senate Bill
No. 646


Introduced by Senator Hertzberg

February 19, 2021


An act to amend Section 454.54 Sections 454.51 and 454.52 of the Public Utilities Code, relating to electricity.


LEGISLATIVE COUNSEL'S DIGEST


SB 646, as amended, Hertzberg. Electricity: integrated resource planning.
Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations. The Public Utilities Act requires the commission to review and accept, modify, or reject a procurement plan for each electrical corporation and requires the procurement plan to include specified elements, among them a showing that it will achieve certain objectives. Existing law requires the commission to identify a diverse and balanced portfolio of resources needed to ensure a reliable electricity supply that provides optimal integration of renewable energy in a cost-effective manner. Existing law requires the commission to ensure the net costs of any incremental renewable energy integration resources procured by an electrical corporation are allocated on a nonbypassable basis, as specified.
This bill would instead require the commission to ensure the net costs of any incremental renewable energy integration resources procured by any load-serving entity designated by the commission to serve as a central procurement entity are allocated on that basis.
Existing law requires that all costs resulting from nonperformance, as specified, are borne by the electrical corporation or community choice aggregator that failed to perform.
This bill would instead require that all costs from nonperformance, as specified, are borne by the load-serving entity that failed to perform.
Existing law specifies the role of community choice aggregators in satisfying the portfolio needs for renewable integration.
This bill would also specify the role of electric service providers as the same as that of community choice aggregators in satisfying the portfolio needs for renewable integration.
Existing law requires the commission to adopt a process for each load-serving entity, defined as including electrical corporations, electric service providers, and community choice aggregators, to file an integrated resource plan and a schedule for periodic updates to the plan to ensure that load-serving entities accomplish specified objectives. Existing law requires each load-serving entity to prepare and file an integrated resource plan consistent with those objectives on a time schedule directed by the commission and subject to commission review. Existing law requires that, to the extent additional procurement is authorized for the electrical corporation in the integrated resource plan, the commission shall ensure the costs are allocated in a fair and equitable manner, as specified, including that community choice aggregators may self-provide renewable integration resources.
This bill would require the commission to ensure that load-serving entities are enabled by an integrated resource plan to procure the necessary resources to meet their customers’ needs. The bill would require that, to the extent additional procurement is authorized for the electrical corporation in the integrated resource plan, the commission shall ensure the benefits, as well as the costs, are allocated in a fair and equitable manner as specified, and that electric service providers, like community choice aggregators, may self-provide renewable integration resources.

Existing law requires the Public Utilities Commission to adopt a process for each load-serving entity, defined to include electrical corporations, electric service providers, and community choice aggregators, to file an integrated resource plan and a schedule for periodic updates to the plan to ensure that it meets, among other things, the state’s targets for reducing emissions of greenhouse gases and the requirement to procure at least 60% of its electricity from eligible renewable energy resources by December 31, 2030. Existing law additionally require that the integrated resource plan contribute to a diverse and balanced portfolio of resources needed to ensure a reliable supply of electricity that provides optimal integration of renewable energy resources in a cost-effective manner and prevents cost shifting among load-serving entities.

This bill would make a nonsubstantive revision to the requirement that an integrated resource plan contribute to a diverse and balanced portfolio of resources needed to ensure a reliable supply of electricity that provides optimal integration of renewable energy resources in a cost-effective manner.

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

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


SECTION 1.

 Section 454.51 of the Public Utilities Code is amended to read:

454.51.
 The commission shall do all of the following:
(a) Identify a diverse and balanced portfolio of resources needed to ensure a reliable electricity supply that provides optimal integration of renewable energy in a cost-effective manner. The portfolio shall rely upon zero carbon-emitting resources to the maximum extent reasonable and be designed to achieve any statewide greenhouse gas emissions limit established pursuant to the California Global Warming Solutions Act of 2006 (Division 25.5 (commencing with Section 38500) of the Health and Safety Code) or any successor legislation.
(b) Direct each electrical corporation to include, as part of its proposed procurement plan, a strategy for procuring best-fit and least-cost resources to satisfy the portfolio needs identified by the commission pursuant to subdivision (a).
(c) Ensure that the net costs of any incremental renewable energy integration resources procured by an electrical corporation a load-serving entity designated by the commission to serve as a central procurement entity to satisfy the residual need identified in subdivision (a) are allocated on a fully nonbypassable basis consistent with the treatment of costs identified in paragraph (2) of subdivision (c) of Section 365.1.
(d) Permit community choice aggregators or electric service providers to submit proposals for satisfying their portion of the renewable integration need identified in subdivision (a). If the commission finds this need is best met through long-term procurement commitments for resources, community choice aggregators and electric service providers shall also be required to make long-term commitments for resources. The commission shall approve proposals pursuant to this subdivision if it finds all of the following:
(1) The resources proposed by a community choice aggregator or electric service providers will provide equivalent integration of renewable energy.
(2) The resources proposed by a community choice aggregator or electric service providers will promote the efficient achievement of state energy policy objectives, including reductions in greenhouse gas emissions.
(3) Bundled customers of an electrical corporation will be indifferent from the approval of the community choice aggregator or electric service providers proposals.
(e) Ensure that all costs resulting from nonperformance to satisfy the need in subdivision (a) or (d), as applicable, shall be borne by the electrical corporation or community choice aggregator the load-serving entity that failed to perform.

SEC. 2.

 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, and shall 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 60 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 For an electrical corporation corporation, enable it to fulfill its obligation to serve its bundled customers at just and reasonable rates.
(D) Minimize impacts on ratepayers’ bills.
(E) Ensure system and local reliability on both a near-term and long-term basis, including meeting the near-term and forecast long-term resource adequacy requirements of Section 380.
(F) Comply with paragraph (1) of subdivision (b) of Section 399.13.
(G) Strengthen the diversity, sustainability, and resilience of the bulk transmission and distribution systems, and local communities.
(H) Enhance distribution systems and demand-side energy management.
(I) 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.
(J) Are enabled to procure the necessary resources to meet their customers’ needs.
(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, 454.5 on a residual basis, the commission shall ensure that the costs and benefits 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 and electric service providers 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 based on a three-year average commencing with January 1, 2013.

SECTION 1.Section 454.54 of the Public Utilities Code is amended to read:
454.54.

In addition to the requirements of Section 454.52, the integrated resource plan of each load-serving entity shall contribute to a diverse and balanced portfolio of resources needed to ensure a reliable supply of electricity that provides optimal integration of renewable energy resources in a cost-effective manner, meets the emissions reduction targets for greenhouse gases described in subparagraph (A) of paragraph (1) of subdivision (a) of Section 454.52, and prevents cost shifting among load-serving entities.