Legislation Working Group Wiki
2020 Legislative Session
Background
CESA’s Board approved a 2020 Legislative Strategy to co-sponsor long-duration-related legislation in 2020, subject to key provisions.
Governor Newsom has indicated that his top 2020 priorities are homelessness, housing, healthcare, and wildfire matters. However, in his State of the State, Governor Newsom did not raise energy topics and instead focused on housing and homelessness, which is the first time in many years where the Governor has focused on such a narrow set of issues .
On March 19, 2020, Governor Newsom issued Executive Order N-33-20 directing all residents to immediately heed current state public health directives to stay home, except as needed to maintain continuity of operations essential to critical infrastructure sectors, which CESA believes includes energy storage based on the energy sector-specific considerations below:
Workers who maintain, ensure, or restore the generation, transmission, and distribution of electric power, including call centers, utility workers, reliability engineers and fleet maintenance technicians
Workers at generation, transmission, and electric blackstart facilities
Workers such as plumbers, electricians, exterminators, and other service providers who provide services that are necessary to maintaining the safety, sanitation, construction material sources, and essential operation of construction sites and construction projects (including those that support such projects to ensure the availability of needed facilities, transportation, energy and communications; and support to ensure the effective removal, storage, and disposal of solid waste and hazardous waste)
Due to the COVID-19 situation, Legislators were asked to reduce the number of legislations by prioritizing their key bills. Only urgent energy bills are requested as the Legislature focuses on budget and other COVID-related bills. The Governor also signaled that the budget in June should focus any incremental spending on COVID-19 relief and policy. The timing of tax deadlines also affected the budget revise period.
On April 7, 2020, CESA jointly submitted a letter with other clean energy associations to support authorizing project construction. The letter was clearly caveated to indicate support for both slowing the spread of COVID-19 while keep critical construction efforts ongoing to address other California goals or challenges. This letter likely augments efforts by Building Trades to work with the Governor to ensure construction on key efforts can continue in prudent manners. This letter focused on DER projects and their roles in addressing PSPS events. Larger power plant construction projects are already deemed to be essential at the state level. Local cities or counties can have more stringent rules than state ones.
On May 13, 2020, CESA sent a letter to Governor Newsom, Assembly Speaker Rendon, and Senate President Pro Tempore Atkins to express the many ways energy storage can support California’s economic and climate goals in light of COVID-19. The letter was intended to position how the energy storage industry can stimulate the California economy should California’s political leadership decide to pursue a stimulus in the coming months. However, the Legislature is receiving many ideas for stimulus, but any effort is challenged by the need to have a balanced budget. The recent failure of a pre-COVID school bond served as a data point that voters may not support bonds much right now. The Governor also has a taskforce looking at the economy.
On July 27, 2020, the Legislature returned. There was friction regarding whether each house is setting enough hearings and hearing enough bills. If insufficient, the Governor can call a special session for the fall to cover additional COVID or wildfire matters. The Legislature remains focused on COVID response and budget matters, with a close eye being paid attention to wildfire mitigation activities as the state enters peak wildfire season.
The session ended without major energy-related bills, despite a fair amount of late action for significant wildfire-related (e.g., fees to pay for wildfire solutions) and COVID-related bills that did not make it through passage. Generally, energy themes were not high in the final order, and relatively few energy bills made it to the finish line, and Legislative leaders expressed a sense of underachievement.
Failed or Delayed Bills
Long Duration Storage (AB 2255)
On February 13, 2020, a bill was introduced by Assemblymember Eggman that would create a potential pathway for long-duration storage projects and is structured to favor in-state resources for job-creating opportunities as well as technology neutrality via the CAISO’s competitive procurement process. Long lead times necessary are considered in procurement. The bill was positioned as technology- and project-neutral.
In the first step, the CAISO evaluates the need for energy storage with eight hours or more in duration, with no MW size limitation on the storage being studied. In the second step, the CAISO reports findings to key agencies and the Governor. Lastly, in the third step, the Governor could authorize the CAISO to direct procurement by 2030 of energy storage as transmission solutions with eight or more hours of duration, depending on the findings and the Governor’s discretion. However, the CAISO’s actions can be pulled back if there are serious issues with California losing control of its capacity planning role.
On May 14, 2020, the bill was scheduled to be heard in the Assembly Natural Resources Committee but ultimately was not, leading to its failure to pass this session.
Long Duration Storage (AB 1720)
On June 29, 2020, this bill was re-introduced by Assembly Member Carrillo, after being first introduced and held in the 2019 legislative session. AB 1720 would expedite pumped hydro storage projects through the CEQA process in an effort to start construction. Additionally, the bill requires the CPUC, by January 4, 2021, to report to the Governor, the CAISO, Department of Water Resources (DWR), and the State Energy Resources Conservation and Development Commission (SERCDC) on the specific types and amount of long-duration energy storage and in-service dates of that storage included in the IRPs submitted by LSEs. The bill also requires the CPUC’s report, to state whether it will issue an order on or before March 1, 2021, requiring LSEs, in the aggregate, to procure, at a minimum, the amount of long-duration energy storage capacity identified in the CPUC’s decision referenced above for a specific threshold of GHG emissions.
CESA held a support if amended position and submitted a letter recommending the following modifications:
Use the aggressive GHG planning scenario (38 MMT by 2030) for all resource planning, not just long-duration storage planning
Ensure BTM resources broadly are not subject to the definition and rules of this specific long-duration procurement (i.e., avoid any problematic precedents)
Allow slightly more time for CPUC process to consider procurement before the procurement gets directed to DWR
Tweak or add language to further ensure there is a competitive and fair process from DWR
The bill was not set for hearing in the Senate Energy, Utilities, & Communications Committee and ultimately did not advance this session.
Pumped Hydropower Pilot Project (SB 597)
On September 6, 2019, this bill was introduced by Senator Hueso that would require the CPUC to direct one or more electrical corporations to procure of a single large-scale, long-duration energy storage pilot project meeting certain requirements. The bill would require an electrical corporation subject to this procurement requirement to submit to the CPUC for approval a proposed cost-of-service or similar rate to cover the costs of the procurement based on the proportionate benefit derived by each ratepayer class from the pilot project. This bill was sponsored by the City of San Diego and the San Diego County Water Authority (SDCWA).
The bill was amended to provide for a procurement solicitation process by the CPUC for a pumped hydropower energy storage project in the Southern California region to come on-line by 2030. CESA was considering an “oppose unless amended” position to introduce broader long-duration storage bill concepts. However, the author pulled the bill.
California Green New Deal (AB 1839)
On January 6, 2020, this bill was introduced that would enact the California Green New Deal and make a series of legislative findings and declarations pertaining to various environmental, social, and economic conditions in the state, including an enumeration of specified rights that all residents of the state have. The bill would state that the Legislature establishes specified goals that would improve the quality of many aspects of life for residents of the state, including, among other things, health care, employment training and transition, worker rights, climate change effects assistance, affordable housing, environmental conditions such as air quality, land use decision-making, and racial equity. The bill would create, within the Strategic Growth Council, the California New Green Deal Task Force, with a membership of state officials and public representatives.
On May 5, 2020, this bill was amended in the Assembly Natural Resources Committee that would be reframed as a COVID-19 Recovery Deal, which would be a framework for California and Federal funding to emphasize social justice and environmental goals as priorities in any recovery efforts. However, the bill ultimately did not advance any further, with a similar bill (AB 3256) taking on these issues instead.
Microgrid Grants Program (SB 1215)
On February 20, 2020, this bill was introduced by Senator Stern that would establish the Local Government De-energization Event Resiliency Program, to be administered by the Office of Emergency Services, to support state and local government efforts to enhance public safety, protect vulnerable populations and individuals, and improve resiliency in response to de-energization events. The bill would establish the Local Government De-energization Event Resiliency Fund and would continuously appropriate the moneys in the fund for expenditure for purposes of the bill. The bill would transfer an unspecified sum from the General Fund to the fund, thereby making an appropriation.
On March 5, 2020, the bill was referred to the Senate Governmental Organization Committee and Senate Energy, Utilities, & Communications Committee. CESA expressed a “support” position on this bill.
On June 18, 2020, the bill was heavily amended in the Senate Appropriations Committee and was approved. The bill emerged much weaker in terms of supporting small community microgrids, but it now included a directive to the CPUC to derive a BTM storage value by Spring 2021. It also includes a directive to provide maps and lists of circuits that fit with some fire-related criteria.
On July 27, 2020, the bill was amended by the Assembly Utilities & Energy Committee but faced questions around the issue of cost reductions for microgrids (e.g., policy regarding departing load charges). This committee has generally limited the bill load. Ultimately, the bill did not advance this session.
Energy Storage & Demand Response for Resource Adequacy (AB 3251)
On February 21, 2020, this bill was introduced by Assemblymember Bauer-Kahan that would require that the RA program achieve specified objectives, including to establish new or maintain existing DR products and tariffs that facilitate the economic dispatch and use of DR that can either meet or reduce an electrical corporation’s RA requirements. This bill would require that: (1) charging of energy storage systems be treated as load in calculations for DR programs; and (2) capacity from energy storage systems installed on the customer side of the meter be allowed to be aggregated for purposes of determining RA capacity and electricity exported to the grid from behind the meter be allowed to count toward the capacity obligations of LSEs in support of that objective.
On March 9, 2020, the bill was referred to the Assembly Utilities & Energy Committee. CESA expressed a “support” position on the bill. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
Energy Resilient Schools Grant Program (AB 3021)
On February 21, 2020, this bill was introduced by Assemblymember Ting that would appropriate $300 million per fiscal year from 2020 through 2023 from the General Fund to the CEC to administer a program to provide resiliency grant funding and technical assistance to local educational agencies for the installation of energy storage systems. An order of priority to allocate resiliency grant funding is specified, and the bill would make a project eligible for funding if it is financed and owned by the local educational agency or financed and owned by a third party that has a power purchase or energy services agreement with the local educational agency.
On March 5, 2020, the bill was referred to the Assembly Education Committee and Assembly Natural Resources Committee. CESA expressed a “support” position on the bill. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
School Disaster Resiliency Act (AB 1001)
On February 21, 2019, this bill was introduced by Assembly Member Ting and re-introduced in June 2020 that would issue $1 billion in bonds for school clean energy projects. This bill would establish the School Disaster Resiliency Act, which would require the CEC to administer a program to provide loans to school districts, county offices of education, and charter schools for school resiliency projects. The CEC shall establish and administer a loan program to provide low-interest loans to local educational agencies for school resiliency projects to enable local educational agencies to create clean energy generation and battery energy storage systems sufficient to provide ongoing community services during and after a disaster.
On July 2, 2020, the bill was referred to the Senate Education Committee and died in committee since it was not scheduled for hearing. CESA held a support position.
Community Energy Resiliency Act of 2020 (SB 1314)
On February 21, 2020, this bill was introduced by Senator Dodd that would require the Strategic Growth Council, which manages and awards grants and loans to support the planning and development of sustainable communities, to develop and implement a grant program for local governments to develop community energy resilience plans.
On March 5, 2020, the bill was referred to the Senate Natural Resources & Water Committee and Senate Energy, Utilities, & Communications Committee. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
Grid Outage Avoided Cost Study (AB 2789)
On February 20, 2020, this bill was introduced by Assemblymember Kamlager that would require the CPUC, in consultation with the State Energy Resources Conservation & Development Commission, to request the California Council on Science & Technology (CCST) to undertake and complete a study relative to electrical grid outages and cost avoidance resulting from deployment of eligible renewable energy resources, battery storage systems, and demand response technologies. The bill would require the CPUC to report the results of the study to the Legislature by January 1, 2022. The bill would appropriate $1,500,000 to the CPUC for the study.
On March 2, 2020, the bill was referred to the Assembly Utilities & Energy Committee. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
Income Tax Credits for Battery Storage for Solar Systems (AB 2359)
On February 18, 2020, this bill was introduced by Assemblymember Mathis that would, under both the Personal Income Tax Law and the Corporation Tax Law, for taxable years beginning on and after January 1, 2021, and before January 1, 2026, would allow a credit to a taxpayer that purchases a battery storage system for a solar energy system in an amount equal to 50% of the costs paid or incurred by the taxpayer for that battery storage system, not to exceed $5,000 per taxable year. The bill would require the Franchise Tax Board to allow the credit to taxpayers filing for the same legal parcel of property on a first-come-first-served basis, determined by the date the taxpayer’s timely filed original tax return is received by the Franchise Tax Board.
On February 24, 2020, the bill was referred to the Assembly Revenue & Tax Committee; however, the bill did not advance any further in this session.
Discriminatory Fees & Charges for Customer-Sited Renewable Energy & Storage (SB 953)
On February 10, 2020, this bill was introduced by Senator Wiener that would require the CPUC, or the governing board of a local publicly-owned electric utility, to ensure that customers within its jurisdiction who have customer-sited renewable energy or energy storage systems are not subject to discriminatory fees or charges levied as a result of installing or using those customer-sited renewable energy or energy storage systems.
On February 20, 2020, the bill was referred to the Senate Energy, Utilities, & Communications Committee. CESA expressed a “support” position on this bill. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
De-Energization Procedures, Cost Allocation, & Reports (SB 378)
On February 20, 2019, this bill was introduced by Senator Stern that would require each electrical corporation to annually submit a report to the Wildfire Safety Division and, after June 30, 2021, to the Office of Energy Infrastructure Safety, that includes the age, useful life, and condition of the electrical corporation’s equipment, inspection dates, and maintenance records for its equipment, investments to maintain and improve the operation of its transmission and distribution facilities, and an assessment of the current and future fire and safety risk posed by the equipment.
On January 27, 2020, the bill was approved on the Senate Floor, after being fast tracked through the Senate Energy, Utilities, & Communications Committee and the Senate Appropriations Committee. The bill did not advance out of session.
De-Energization Public Safety Protocols (SB 801)
On January 7, 2020, this bill was introduced by Senator Glazer that would require an electrical corporation to deploy backup electrical resources or provide financial assistance for backup electrical resources to a customer receiving a medical baseline allowance if the customer meets those conditions.
On May 14, 2020, the bill was approved in the Senate Energy, Utilities, & Communications Committee. The bill did not advance out of session.
Sales & Use Tax Exemptions for Backup Electrical Resources (SB 952)
On February 10, 2020, this bill was introduced by Senator Nielsen that would, on and after January 1, 2021, would provide an exemption from sales and use taxes with respect to the sale of, or the storage, use, or consumption of, a backup electrical resource that is purchased for exclusive use by a city, county, special district, or other entity of local government during de-energization events. The bill did not advance out of session.
Skilled Nursing Facilities Backup Power Systems (SB 1207)
On February 20, 2020, this bill was introduced by Senator Jackson that would require a skilled nursing facility to have a backup power system that maintains a safe temperature within the skilled nursing facility and power to all critical systems to resident health and safety for no less than 96 hours during any type of power outage. The bill would also require a backup power system to have the ability to be refueled after 96 hours if a power outage is still in effect.
On September 25, 2020, the bill was vetoed by the Governor after advancing out of session.
EV Charging Station Approval Process (SB 2145)
On February 11, 2020, this bill was introduced by Assemblymember Ting that would state the intent of the Legislature to enact legislation to reform the EV charging infrastructure approval process to help ensure that by 2030, California will safely install enough electric vehicle charging ports to meet the demand for charging infrastructure through public and private investment.
On April 24, 2020, the bill was referred to the Assembly Utilities & Energy Committee. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
EV Charging Master Plan (SB 1183)
On February 20, 2020, this bill was introduced by Senator Hertzberg that would require the CEC, as a part of each update to the statewide EV charging infrastructure assessment, to conduct an assessment of certain factors and how those factors will affect the market for and technological development of EV and infrastructure.
On March 5, 2020, the bill was referred to the Senate Energy, Utilities, & Communications Committee and Senate Transportation Committee. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
EV Grid Integration Ancillary Services (SB 1321)
On February 21, 2020, this bill was introduced by Senator Bradford that would amend the Public Utilities Act by including offering ancillary services, rather than offering reliability services, as a means of providing net benefits to ratepayers, as required for EV grid integration. The Public Utilities Act currently requires the CPUC, by December 31, 2020, to establish strategies and quantifiable metrics to maximize the use of feasible and cost-effective electric vehicle grid integration by January 1, 2030.
On March 12, 2020, the bill was referred to the Senate Energy, Utilities, & Communications Committee. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
Open Access Distribution System (SB 1240)
On February 20, 2020, this bill was introduced by Senator Skinner that would require the CEC, in consultation with the CAISO, to identify and evaluate options for transforming the electrical corporations’ distribution grids into more open access platforms that would allow local governments and other third parties to participate more easily in grid activities. The bill would require the CEC to update the identification and evaluation at least once every two years. The bill would require the commission, beginning January 1, 2022, and biennially thereafter, to submit to the Legislature a report on the identification and evaluation of options.
On March 5, 2020, the bill was referred to the Senate Energy, Utilities, & Communications Committee. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
Diversity-Related Procurement of Microgrids (SB 1422)
On February 21, 2020, this bill was introduced by Senator Bradford that would allow a credit against personal income taxes for each taxable year beginning on or after January 1, 2021, and before January 1, 2026, in an amount that is equal to 50% of the amount incurred by a natural person or a small business during the taxable year for the purchase, that does not exceed $7,000, of a backup generator for use in a residence or commercial property in a designated wildfire zone.
On March 12, 2020, the bill was referred to the Senate Energy, Utilities, & Communications Committee. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
Fuel Cells for De-Energization Events (AB 3128)
On February 24, 2020, this bill was introduced by Assemblymember Burke that stated the intent of the Legislature to enact legislation that would incentivize the use of fuel cells to address reliability issues associated with public safety power shutoffs. This was a spot bill when introduced. However, the bill subsequently failed to meet a deadline by June 5, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
Thermal Power Plant Exemption (SB 858)
On January 14, 2020, this bill was introduced by Senator Beall that would exclude an emergency backup or stationary generator that is not connected to the electrical grid and that is constructed, operated, or modified to provide immediate electrical power to maintain the operations of a data center in the event of an outage of electricity from the electrical grid from the definition of a thermal powerplant.
On January 22, 2020, the bill was referred to the Senate Energy, Utilities, & Communications Committee. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
Centralized Electricity Procurement (AB 3014)
On February 21, 2020, this bill was introduced by Assemblymember Muratsuchi that establish a Power Exchange as a non-profit public benefit corporation and require the Power Exchange to provide an efficient competitive auction, open on a non-discriminatory basis to all electricity suppliers, that meets the loads of all exchange customers at efficient prices. This bill would state the intent of the Legislature to establish a residual RA centralized procurement structure in California to help ensure the reliability of the state’s electrical system.
On April 24, 2020, the bill was referred to the Assembly Utilities & Energy Committee. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
Public Capital Facilities Rate Reduction Bonds (SB 804)
The Marks-Roos Local Bond Pooling Act of 1985 authorizes certain joint powers authorities, upon application by a local agency that owns and operates a publicly-owned utility, defined to mean certain utilities furnishing water or wastewater service to not less than 25,000 retail customers, to issue rate reduction bonds to finance utility projects. Under the act, these rate reduction bonds are secured by a pledge of utility project property, and the joint powers authority issuing the bonds may impose on, and collect from, customers of the publicly owned utility a utility project charge to finance the bonds.
On January 8, 2020, this bill was introduced by Senator Weiner that would expand the definition of a publicly-owned utility for these purposes to include certain utilities furnishing generation, transmission, or distribution electrical service to retail customers and would authorize an authority to issue rate reduction bonds to finance or refinance utility projects for the provision of generation, transmission, or distribution electrical service.
On January 15, 2020, the bill was referred to the Senate Government Committee and Senate Energy, Utilities, & Communications Committee. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
Eminent Domain by California Consumer Energy & Conservation Financing Authority (SB 917)
On February 3, 2020, this bill was introduced by Senator Beall that would authorize the California Consumer Energy & Conservation Financing Authority to acquire, by eminent domain, the assets or ownership of an electrical corporation, gas corporation, or public utility that is both an electrical and gas corporation, including any franchise rights, if that corporation has been convicted of one or more felony criminal violations of laws enacted to protect the public safety within 10 years of the date the eminent domain action is commenced. The bill would authorize a local publicly-owned energy utility to elect to join in the eminent domain action brought by the authority and acquire that portion of the electrical or gas system necessary to provide service within its borders if the local publicly-owned energy utility contributes its proportionate share of the compensation paid for the assets or ownership of the public utility.
On February 12, 2020, the bill was referred to the Senate Energy, Utilities, & Communications Committee, Senate Government & Finance Committee, and Senate Judiciary Committee. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
Adjustment of RPS Procurement Requirements (SB 1358)
On February 21, 2020, this bill was introduced by Senator Bradford that would would provide authorization for a local publicly-owned electric utility that has a gas-fired powerplant on which public debt is owed and that is operating at less than 20% of capacity to adjust renewable energy procurement targets, if it has 10,000 or more customers, in addition to all other applicable conditions.
On March 12, 2020, the bill was referred to the Senate Energy, Utilities, & Communications Committee. However, the bill subsequently failed to meet a deadline by June 5, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
Unbundled Renewable Energy Credits (AB 2547)
On February 19, 2020, this bill was introduced by Assemblymember Gonzalez that would increase the requirement for the purchase of RPS Category 1 products in meeting the retailer sellers’ renewable energy procurement obligations to 85% for compliance periods after December 31, 2020. The bill would prohibit the purchase of RPS Category 3 products in meeting the retailer sellers’ renewable energy procurement obligations for compliance periods after December 31, 2020.
On March 12, 2020, the bill was referred to the Assembly Utilities & Energy Committee and Assembly Natural Resources Committee. CESA had no position. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
Hydrogen Energy (AB 2940)
On February 21, 2020, this bill was introduced by Assemblymember Quirk that would require the CPUC, in consultation with the CEC and CARB, to establish a critical consumption program for hydrogen production and processing and to establish a framework for directing electricity generated by eligible renewable energy resources to the production and processing of hydrogen at specified times. The bill would require the CPUC to direct an electrical corporation to file a petition with FERC to file tariffs for the removal of the non-coincident peak demand charge..
On March 5, 2020, the bill was referred to the Assembly Utilities & Energy Committee and Assembly Natural Resources Committee. However, the bill subsequently failed to meet a deadline by May 29, 2020. Likely due to the winnowing of bills to only the highest priority in the COVID-19 context, the bill was no longer moving through the session.
Joshua Tree National Park Groundwater (AB 2736)
On February 20, 2020, this bill was introduced by Assemblymember Eduardo-Garcia that would require a person who extracts or uses water from a groundwater basin within 20 miles of Joshua Tree National Park for purposes of construction and operation of a closed-loop pumped hydroelectric energy storage system to submit to the State Water Resources Control Board any plans, technical reports, or monitoring data reports related to groundwater required under any license for hydroelectric generation issued by FERC. The bill would require those materials submitted to the state board to include certain other information relating to groundwater monitoring and environmental impacts.
On May 5, 2020, this bill was amended by the Assembly Committee on Water, Parks, & Wildlife. It is unclear if the bill will be heard. Later, in June 2020, this bill was held in the Assembly Appropriations Committee and did not advance in this session
2019 Legislative Session
Background
CESA’s Board approved a 2019 Legislative Strategy to focus on education and outreach, to be opportunistic as the legislative cycle grinds on, and to play defense where needed. CESA did not plan to sponsor or especially champion any bill or idea for 2019. This is similar to our strategy from last year, as we anticipated a number of bills tied to central procurement, wildfires, and utility liability.
On March 19, 2019, the Senate held an informational hearing on the need for a new regulatory approach for the changing electricity landscape. CPUC President Michael Picker and CPUC Executive Director Ed Randolph presented on the various ‘change’ factors, including direct access, CCA growth, retail choice, and PG&E’s bankruptcy proceedings.
On June 7, 2019, the Commission on Catastrophic Wildfire Cost & Recovery held a meeting to review subcommittee findings and recommendations relating to utility liability, funding mechanisms, homeowner’s insurance, and wildfire mitigation. All utilities, including water utilities, were swept up in this, which added complexity. The recommendations informed the Governor and Legislature as they negotiate solutions, and the report suggested that the Legislature consider changes to inverse condemnation. For energy storage, the landscape of buyers may change but are not necessarily in a way that is ultimately too destabilizing.
On June 19, 2019, CESA held its annual Lobby Day in Sacramento, CA where CESA met with key Senate and Assembly Energy Committee staff and Democratic leadership. CESA also coordinated a ‘Campaign Fundraiser for Energy Storage Champions’ in the same evening for Senators Nancy Skinner and Henry Stern.
The Legislative session concluded in August 2019 and the Governor signed a number of bills in September and October, including:
SB 676: EV Grid Integration
SB 49: Energy Efficiency & Load Flexibility
SB 255: Diversity-Related Rules & Protocols
AB 1208: Solar Utility Users Tax Exemption
AB 1054: Fire Fund & Prudent Manager Standard for Utility Fire Liabilities
ACR 78: PG&E Bankruptcy
Notably, while there were a number of bills related to wildfire issues and PG&E’s bankruptcy, most of them failed to pass through the Legislature, except for a few bills that support short-term fixes, due to more time being sought to consider the best approach. CESA did not sponsor a bill in this session but supported a number of storage-related bills. Overall, this session concluded with no major storage market-driving bills, though SB 676 will support VGI from EVs and EVSEs to provide demand response and mobile storage.
Approved Bills
EV Grid Integration (SB 676)
On February 22, 2019, this bill was introduced by Senator Steven Bradford and was amended on March 27, 2019 that would require the CPUC, by December 31, 2020, in an existing proceeding, to establish targets to be achieved by 2025 and 2030 for electric vehicle grid integration for the service territory of each electrical corporation with at least 200,000 customers, sub-targets for CCAs with at least 200,000 customers in that service territory, and sub-targets for ESPs as the CPUC deems just and reasonable. The bill was driven by eMotorwerks, an Enel X subsidiary.
On April 24, 2019, the bill was approved by the Senate Energy, Utilities & Communications Committee with amends to require the CPUC to consider how to maximize ratepayer benefits. This bill would create a framework for LSEs to meet annual VGI targets but is not prescriptive on technology types. The bill was amended to focus more broadly on requiring EV integration strategies and providing more flexibility to use rates or other solutions in addition to specific charging technologies. These amends were intended to support easier compliance. CESA launched a support letter and provided verbal support.
On May 20, 2019, the bill was approved by the Senate.
On July 3, 2019, the bill was approved by the Assembly Utilities & Energy Committee with amends to clarify the focus of the bill’s directives on CPUC-jurisdictional LSEs, consider quantifiable metrics, broaden to focus on charging in general instead of specifying non-peak charging, and omit percentage amounts for VGI targets.
On July 10, 2019, the Assembly Communications & Conveyance Committee approved the bill that amended the definition for “EV grid integration” as “methods of altering” as opposed to “actions” taken.
On September 11, 2019, the bill was passed by the Assembly and subsequently signed into law by the Governor.
Diversity-Related Rules & Protocols (SB 255)
On February 12, 2019, Senator Steven Bradford introduced this bill that would require electric service providers, certain wholesale generators selling electricity to retail sellers, DER contractors, and energy storage system companies to comply with General Order (GO) 156 to increase procurement from small, local, and diverse business enterprises. Many companies would fall under the compliance cap since it involves any company with annual gross California revenue above $1,000,000, which is a lower threshold than the current $25,000,000.
On March 27, 2019, this bill passed through the Senate Energy, Utilities, & Communications Committee after being amended to no longer require CCAs to comply with GO 156 and report on their progress. Many CCAs expressed support for the bill. Many CCAs expressed support for the bill. CESA expressed support for diversity but conveyed concerns that the energy storage and DER industry is still growing to be included for reporting requirements at this time. CESA emphasized that the incentive to be a diverse supplier already exists since IOU and CCA supply chain procurement is focused on these goals. Furthermore, the reporting requirement can be onerous.
On April 22, 2019, the bill was initially placed on suspense in the Senate Appropriations Committee but was heard and approved with amends that would only place requirements on companies with $15 million in California revenues. In addition, the committee estimated fiscal costs of the bill at $1 million in the first year and $750,000 annually in years thereafter. Due to significant price tag, Legislators may consider ways to lower costs.
On May 21, 2019, the bill was approved by the Senate with no amends.
On June 26, 2019, the bill was approved in the Assembly Utilities & Energy Committee that was amended to make the reporting voluntary.
On September 3, 2019, the bill was amended in the Assembly Appropriations Committee to make the reporting voluntary for energy storage companies. Given that the reporting was made voluntary for energy storage companies, CESA submitted a support letter that emphasized the specific pieces of information that companies are willing to voluntarily report. CESA also expressed appreciation for recognizing the complexity of reporting for companies that operate across state lines and for those that are involved in multiple lines of business.
On October 2, 2019, the Governor signed the bill into law.
Solar Utility Users Tax Exemption (AB 1208)
On February 21, 2019, this bill was introduced by Assembly Member Phil Ting and sponsored by CALSSA that would seek a solar utility users tax exemption and an extension of the expiration of the tax exemption from 2020 (current) to 2027 (proposed). The bill would expand the definition of “clean energy resource” to include a device or technology used for a renewable electrical storage facility. The bill would include findings that the changes proposed by this bill address a matter of statewide concern rather than a municipal affair and, therefore, apply to all cities, including charter cities.
On May 1, 2019, the bill was approved by the Assembly Local Government Committee and was amended to include energy storage. With these amends, CESA submitted a support letter.
On May 13, 2019, the bill was approved by the Assembly. CESA explored whether the original legal definition will ensure that both standalone storage and storage paired with renewables can qualify for the exemption.
On June 19, 2019, the Senate Governance & Finance Committee approved the bill, with amends that removed language on the definition of “generation resource” to rely on the RPS definition, which does not treat standalone storage as generation. Amends to include storage were considered but the preferred path forward was to add a letter to the file to explain how storage is already in the original definition for “generation resource”.
On August 22, 2019, the bill was approved by the Senate and subsequently signed into law by the Governor.
Energy Efficiency (SB 49)
On December 3, 2018, this bill was introduced by Senator Skinner that would require the State Energy Resources Conservation & Development Commission to prescribe, by regulation, standards for appliances and buildings to facilitate load management. The bill would authorize the commission to include in the regulations other cost-effective measures to promote the use of demand flexible appliances, the use of which has an effect on a building’s energy demand profile. The bill would require that the standards and other regulations become effective no sooner than one year after the date of adoption or revision. The bill would authorize the commission to establish an administrative enforcement process to enforce the standards for appliances and buildings to facilitate load management and to assess an administrative civil penalty. CESA explored whether and how to define storage and/or V1G as an eligible “demand flexible appliance” as part of this bill. CESA also aimed to ensure that Title 24 changes do not discourage energy storage use and are not prescriptive.
On April 29, 2019, the bill was approved with modifications in the Senate Environmental Quality Committee to focus on directing the CEC to consider GHG savings in its setting of efficiency standards. CESA submitted a support letter and voiced support in the Senate Environmental Quality Committee.
On May 20, 2019, the bill was approved on the Senate Floor after passing through the Senate Appropriations Committee with no amends.
On August 13, 2019, the bill was heard in the Assembly Utilities & Energy Committee and amended to focus on water.
On September 11, 2019, the bill was approved by the Assembly and was subsequently signed into law by the Governor. The CEC will now be required to foster the development grid integration, not just energy efficiency, in setting appliance and building code standards to incentivize technologies that can shift demand for electricity. The bill would take effect on January 1, 2020.
Fire Fund & Prudent Manager Standard for Utility Fire Liabilities (AB 1054)
In July 2019, the bill was introduced by Assembly Members Holden, Burke, and Mayes late in the Legislative session. The bill does not propose changing inverse condemnation but allows better transfer of these costs to ratepayers through the use of a $21-billion fund and protects shareholders through the prudent manager standard. Two separate funding mechanisms would be established: (1) a $10.5-billion liquidity fund, paid for by an existing $2.50/month charge on customer's bills, which would offer IOUs short-term loans, repayable in full, to cover ongoing wildfire costs; and (2) a $10.5-billion insurance fund raised by proportional contributions from SCE and SDG&E, if they choose to participate, that would be available to pay out wildfire liability claims. PG&E will not be allowed to participate until it has settled its 2017 and 2018 wildfire liability claims and emerged from bankruptcy protection. Participation in the insurance fund will require the IOUs to pass annual safety certifications, put limits on executive pay, and invest a collective $5 billion in safety improvements that will not be recoverable through rates.
On July 11, 2019, the bill was signed and approved by the Senate and Assembly within a week and subsequently approved by the Governor. This bill received widespread support (including a wildfire victim advocacy group) and addressed the Legislature’s utility financing and wildfire concerns. The bill will support quicker wildfire liability payouts, stabilize credit ratings for SCE and SDG&E, and encourage PG&E to come out of bankruptcy, thereby supporting more procurement contract continuation.
PG&E Bankruptcy (ACR 78)
This Concurrent Resolution would provide that the pending PG&E Chapter 11 bankruptcy proceedings, and any resolution thereof, must protect the citizens of California from the imminent and ongoing threats posed by climate change, the buildup of fuels, and inadequate electrical infrastructure. The measure would provide that it is the will of the Legislature that the CPUC, in filings with the bankruptcy court overseeing the proceedings, promote certain policy goals relating to PG&E, the electrical and gas systems, and victims of wildfires, and communicate the proceedings’ profound and direct impacts on the people of California.
On September 9, 2019, the Concurrent Resolution was approved. It becomes effective and does not require the Governor’s signature.
Failed or Delayed Bills
Long-Duration Bulk Energy Storage Procurement (SB 772)
On February 22, 2019, this bill was introduced by Senator Steven Bradford that would require the CAISO, on or before June 30, 2022, to complete a competitive solicitation process for the procurement of one or more long-duration energy storage projects that in aggregate have at least 2,000 MW capacity, but not more than 4,000 MW. The bill would require that the competitive solicitation process provide for cost recovery from LSEs within the CAISO-controlled electrical grid that the CAISO determines is just and reasonable and that takes into account the distribution of benefits from the long-duration bulk energy storage.
On April 24, 2019, this bill was passed through the Senate Energy, Utilities, & Communications Committee and was amended to eliminate the requirement around the ability to cycle on a daily basis. Some Senators voiced questions or objections.
On May 16, 2019, the bill was approved by the Senate Appropriations Committee with a number of the following changes:
Established Stage 1 and 2 cost safeguards
Removed specific language on pumped hydro storage in the definition of eligible energy storage systems
Clarified that eligibility is based on having “some deployment” as opposed to the previous eligibility criteria for having any previous deployment in place for 40 years
Directed a methodology where the CAISO will allocate costs in accordance with benefits of the procured energy storage system
Added language that clarified that FERC cannot direct solutions that work against GHG emissions goals
Overall, the intent of the bill has remained the same to focus on infrastructure-like energy storage systems (i.e., at least 400 MW in project size) that do not have readily-available procurement pathways. In addition, while the CAISO will be in a procurement role, it will not be in an ownership role, in line with the SATA model. CESA was neutral on this bill, but with the amends above, including around expanding technology eligibility. The CCAs have remained neutral.
The bill did not pass through the Senate Floor but could be taken up next year in the second year of this two-year session.
Electricity Microgrids (SB 774)
On February 22, 2019, this bill was introduced by Senator Stern that would require each electrical corporation to collaborate with local governments and other interested parties in its service territory to identify locations where microgrids may provide increased electrical resiliency. The bill would authorize electrical corporations to file applications with the CPUC to invest in, and deploy, microgrids to increase resiliency, require the CPUC to approve, certain microgrid applications that use a cost-recovery mechanism that recovers costs from all ratepayers in proportion to the benefits they receive, and require that an electrical corporation’s microgrid investments earn a reasonable rate of return. The bill would require electrical corporations to be exclusively responsible for planning for, making investments in, and operating energy resources that provide electrical distribution grid operations or services on an electrical corporation’s side of the meter.
On April 24, 2019, the bill was passed by the Senate Energy, Utilities & Communications Committee. CESA indicated an ‘opposed unless amended’ position and expressed concerns with the unnecessary and restrictive limitations on third parties to provide microgrid services. The bill has the support of the IOUs. CESA met with the author’s office to discuss the intent of the bill, which was identified as helping the state deal with Public Safety Power Shut-offs (PSPS). Senator Stern indicated the bill can be modified to allow for third-party participation in solutions.
On May 23, 2019, the bill was approved by the Senate, but the bill did not move this year, as the author never settled on a viable set of ideas and the Assembly Utilities & Energy Committee urged the author to not bring the bill forward at this time. PSPS mitigations were not discussed as the top priority in the Legislature. The bill is now a two-year bill.
SGIP Community Energy Storage Systems (AB 1144)
On February 21, 2019, this bill was introduced by Assembly Member Laura Friedman that is focused on using energy storage for fire resiliency. It does this by taking 10% of annual collection of SGIP funds from 2020 and directing them for use in three to five pilot projects for installation of community energy storage systems in high fire threat districts. Pilots would be evaluated to inform stakeholders.
On April 10, 2019, the bill was approved and amended in the Assembly Utilities & Energy Committee. The amendments may not be useful in directing SGIP efforts and may strand some customers who may otherwise suffer from PSPS events. The bill did not define IFOM versus BTM goals, nor did it define community energy storage. CESA provided input to the author on how this bill could appropriately leverage SGIP money ($16 million) as well as on how limitations of SGIP could be removed to achieve the fire resiliency goals.
On April 25, 2019, the bill was approved by the Assembly and was considered as part of SB 774 discussions.
On June 18, 2019, the bill was approved by the Senate Energy, Utilities, & Communications with amends that would require the CPUC to prioritize funding and adjust SGIP rules for resiliency projects to support eligible customers during a de-energization event. Customer eligibility criteria include: demonstrated financial need; a customer providing critical infrastructure to communities in high fire threat districts; and demonstrated coordination with relevant entities. The bill would require the CPUC to include an evaluation of the performance and impact of projects funded in a relevant SGIP evaluation report no later than June 1, 2023.
On August 30, 2019, the Senate Appropriations Committee approved the bill but it did not advance to the Senate Floor, thus becoming a two-year bill.
Solar & Storage Interconnection (SB 288)
On February 13, 2019, Senators Weiner and Nielsen introduced this bill that would, by January 1, 2021, require the CPUC and the governing board of each local publicly-owned electric utility to, among other things, create one or more tariffs that offer fair compensation for customer-sited energy storage systems that export electricity to the electrical grid and to consider one or more tariffs for customer-sited energy storage and renewable energy systems to support grid reliability and community resiliency in the event of emergencies or grid outages. The bill also focuses on streamlined solar-plus-storage interconnections.
On March 28, 2019, the bill was approved in the Senate Energy, Utilities, & Communications Committee with amends to add specific references that renewable energy and energy storage can benefit low-income and disadvantaged communities and to define “customer-sited” and “energy storage” terms. A limiting cost-shifting provision was also being explored by solar groups.
On May 23, 2019, the bill was approved through the Senate Floor following amendments to make this bill more focused on interconnection streamlining, not on creating tariffs for energy storage systems that export electricity to the grid or that focus on resiliency. However, the bill never made it through the Assembly.
Solar & Energy Storage Systems & Components Listed by CEC (AB 877)
On February 20, 2019, this bill was introduced by Assembly Member Jesse Gabriel as a spot bill and then amended on March 26, 2019 that would direct the CEC to establish minimum requirements and develop rating standards for the performance and safety of a solar energy system that is not receiving ratepayer-funded incentives and that is interconnected to the electrical distribution system.
The CEC is certain of its authority to develop an eligibility list for solar, but it may lack that authority for energy storage once SB 1 is ‘finished’. CESA’s aim here was be to limit duplicative work and ideally have just one AHJ – e.g., different statewide and local standards.
The bill was ultimately pulled due to opposition from Labor.
Energy & Energy Infrastructure Procurement Requirements (AB 1083)
On February 21, 2019, the bill was introduced by Assembly Member Autumn Burke that would request the CCST, upon request by certain key individuals of the Legislature, to undertake and complete an analysis of the effects of legislation proposing to mandate procurement of electricity products, gas products, energy storage resources, or electrical or gas infrastructure by an LSE, or any state-level energy procurement entity.
On May 13, 2019, the bill was passed through the Assembly. CESA expressed concerns that directed studies could slow down progress on energy matters. CESA also explained that there is cost-effectiveness language in bills that can address legislators’ concerns.
On July 10, 2019, the bill was approved by the Senate Energy, Utilities, & Communications with amends that would require that the strategies adopted in a long-term plan or procurement plan achieve efficiency in the use of fossil fuels and address emissions of GHG emissions. CCST is also directed to establish a private fund to collect money to fund this analysis.
On August 13, 2019, the bill was amended to include an assessment of benefits, in addition to costs, of any mandate. However, when the bill went to the Senate Floor, it was held and became a two-year bill.
Non-Energy Benefits of Energy Programs & Projects (AB 961)
On February 21, 2019, the bill was introduced by Assembly Member Eloise Reyes that would require the CPUC to: (1) establish common definitions of non-energy benefits and attempt to determine consistent values for use in all energy programs; (2) meaningfully consider and prioritize producing non-energy benefits in clean energy programs and projects; (3) give preference to producing non-energy benefits in clean energy programs and projects in low-income and disadvantaged communities; and (4) track and the nonenergy benefits produced in energy programs and report those benefits during program evaluations.
On April 10, 2019, the bill was approved and amended by the Assembly Utilities & Energy Committee. The bill was focused on environmental justice and was informed by the Greenlining Institute. CESA issued a support letter and recommended that the non-energy benefit concept be made more binding (e.g., by directing the use of a societal cost test), given the vagueness of the terms in the bill. However, the bill never made it out of the Assembly Appropriations Committee.
On May 16, 2019, the bill was held under suspense in the Assembly Appropriations Committee, so it will not advance this year.
Statewide Central Procurement Entity (AB 56)
On December 3, 2018, this bill was introduced by Assembly Member Eduardo Garcia that would establish a central procurement authority for all CCAs, IOUs, and ESPs. It could act as the central buyer and procurer to address electric system needs and would be created with dual-reporting lines to the CEC and CPUC. Some up-front criteria would be needed in order to be created.
On April 30, 2019, the bill was amended in the Assembly Natural Resources Committee on April 30 to authorize the CPUC to undertake procurement as opposed to requiring the CPUC to do so. There were concerns regarding how this bill could remove the ability of CCAs to have choice and to direct procurement. Since energy storage procurement is technical, CESA has a concern that the central procurement authority would not understand complex use cases. At the same time, it may facilitate procurements that are big enough for infrastructure-level projects.
On May 30, 2019, bill was approved by the Assembly despite concerns from CCAs, but the Senate Energy, Utilities, & Communications Committee subsequently failed to pass the bill on July 10, 2019 due to discomfort expressed by Senators. The bill is now a two-year bill. The CPUC now resumes the role as the main arena for determining procurement authorities.
Multi-Year Centralized RA Mechanism (SB 350)
On February 19, 2019, this bill was introduced by Senator Bob Hertzberg that would authorize the CPUC to consider a multi-year centralized resource adequacy mechanism, among other options, to most efficiently and equitably meet specified resource adequacy objectives.
On March 27, 2019, this bill was approved by the Senate Energy, Utilities, & Communications Committee and may currently be a placeholder for something potentially bigger.
On April 25, 2019, the bill was approved by the Senate, even though the CCAs expressed their opposition. The bill did not advance out of the Assembly Utilities & Energy Committee and became a two-year bill.
Natural Disasters Insurance (SB 290)
On February 14, 2019, this bill was introduced and would, upon appropriation by the Legislature, authorize the Governor to purchase insurance, reinsurance, insurance linked securities, or other related alternative risk-transfer products for the State of California to help mitigate against costs incurred by the state in response to a natural disaster, including, but not limited to, an earthquake, wildfire, or flood. The bill would require the Office of Emergency Services, or another agency designated by the Governor, to work with the Treasurer and the Insurance Commissioner to determine the appropriate product to be purchased by the state pursuant to these provisions.
On May 23, 2019, the bill was approved by the Senate with no amends, but it was estimated to have a multi-million-dollar cost.
On June 26, 2019 and July 10, 2019, the bill was approved and passed by the Assembly Insurance Committee and Assembly Governmental Organization Committee, respectively, but was ultimately amended and turned into a two-year bill to be considered in 2020.
Fire Hazard Severity Zone Property Insurance (AB 740)
The California FAIR Plan Association is a joint reinsurance association formed by state insurers licensed to write and engaged in writing basic property insurance within this state to assist persons in securing basic property insurance and to formulate and administer the FAIR Plan for the equitable apportionment among insurers of basic property insurance. Existing law requires each insurer to participate in the writings, expenses, and profits and losses of the association in the proportion that its premiums written bear to the aggregate premiums written by all insurers in the program, as specified, but requires the plan to provide for a method for insurers who voluntarily write basic property insurance on risks located in areas designated as brush hazard areas to be proportionately relieved of the liability to participate in the plan.
This bill would add to the insurers that are proportionately relieved of the liability to participate in the FAIR Plan those voluntarily writing basic property insurance on risks in high or very high fire hazard severity zones, as determined and mapped by the Department of Forestry and Fire Protection.
On September 9, 2019, the bill was ordered to inactive file at the request of Senator McGuire. This becomes a two-year bill.
California Wildfire Catastrophe Fund Act (AB 235)
This bill would create the California Wildfire Catastrophe Fund Authority, which would be governed by a board of directors. The bill would authorize electrical corporations and local publicly owned electric utilities to participate in the authority. The bill would require each participating entity to make an initial contribution and annual contributions to the authority, and would require the board to deposit those contributions into an account dedicated to receiving contributions from that participating entity. The bill would require the shareholders of certain large electrical corporations to make an initial contribution of an unspecified amount to the authority, if the large electrical corporation chooses to participate in the authority.
This bill was approved by the Assembly as a potential part of the package of bills related to fire-liabilities. However, the bill never made it out of the Legislature, which determined that further debate is needed in the next year.
Green Electrolytic Hydrogen (SB 662)
On February 22, 2019, this bill (sponsored by Ballard Power Systems) was introduced by Senator Archuleta that would require the CPUC and CEC to take into account opportunities to increase grid-responsive production of green electrolytic hydrogen for use in the transportation sector.
On April 10, 2019 and April 23, 2019, the bill was approved by the Senate Energy, Utilities, & Communications Committee and the Senate Transportation Committee with amendments to add that “green electrolytic hydrogen” may not use any feedstock that is a fossil fuel or that causes, creates, or increases emissions of greenhouse gases or criteria air pollutants.
On May 22, 2019, the bill was approved by the Senate but was never heard in the Assembly Utilities & Energy and Transportation Committees.
Hydrogen Injection Studies & Standards (AB 491)
On February 12, 2019, this bill (sponsored by Sempra) was introduced by Assembly Member Blanca Rubio that would direct the California Council on Science and Technology (CCST) to undertake and, on or before December 31, 2020, to complete a study analyzing the potential impacts of increased hydrogen concentration in the natural gas supply on the California natural gas system, including specified information. If the CCST agrees to undertake and complete the study, the bill would require the CPUC, by June 1, 2021, to adopt standards for hydrogen to be injected into a common carrier pipeline, taking the study into consideration, while ensuring pipeline and pipeline facility integrity and safety.
On April 3, 2019, the bill was passed by the Assembly Utilities & Energy Committee and amended to define hydrogen as zero-carbon, produced from renewable resources, and other parameters assessed by state agencies. CESA submitted a support letter. The author wanted the CCST study to determine the appropriate percentage (1%-20%) of hydrogen that could be safely injected into a natural gas pipeline. Sierra Club and other environmental groups opposed because the bill does not call for 100%, though specifics of their opposition were not apparent. This bill looked at the hydrogen injection standards of the United Kingdom where there is a 5% injection band allowed.
On April 24, 2019, the bill was put on suspense in the Assembly Appropriations Committee, so the bill will not advance this year.
Retail Hydrogen Vehicle Fuel Sales & Use Tax Exemption (AB 745)
On February 19, 2019, this bill was introduced by Assembly Member Petrie-Norris that would, on and after January 1, 2020 and before January 1, 2024, exempt from sales and use taxes the gross receipts from the sale in this state of, and the storage, use, or other consumption in this state of, retail hydrogen vehicle fuel, as defined.
On May 6, 2019, the Assembly Committee on Revenue & Taxation heard the bill but did not advance. It will not move this year but it may next year.
Zero Emission Vehicle Comprehensive Strategy (AB 40)
On December 3, 2018, this bill was introduced by Assembly Members Ting and Kalra that would require CARB to develop a comprehensive strategy no later than January 1, 2021 to ensure that the sales of new motor vehicles and new light-duty trucks in the state have transitioned fully to ZEVs by 2040. CESA launched a support letter.
On April 8, 2019, a hearing was held in the Assembly Transportation Committee, but it was double referred, so the bill will not move in the first year of the two-year Legislative session.
Clean & Fire-Resilient Electric Grid Solutions (SB 766)
On February 22, 2019, this bill was introduced by Senator Bradford that would state the intent of the Legislature to enact legislation to accelerate investment in and deployment of clean energy electrical grid solutions to make the electrical grid more reliable and fire resilient. This bill may be working to build off the EPIC Program to focus investments to various energy technologies. This bill is a ‘spot bill’ and more updates may be provided at a later time.
Green New Deal (AB 1276)
On February 21, 2019, this bill was introduced by Assembly Member Bonta that would state the intent of the Legislature to enact legislation to develop and implement a Green New Deal with the objective of reaching specified environmental outcomes within the target window of 10 years from the start of execution of the plan and accomplishing certain social goals.
RPS Procurement Contracts (AB 1513)
On February 22, 2019, this bill was introduced by Assembly Member Holden that would authorize an electrical corporation, upon receiving approval of an application by the CPUC, to assign all or part of a contract for the procurement of eligible renewable energy resources to a retail seller, local publicly owned electric utility, electrical cooperative, the Department of Water Resources, or a military facility.
2018 Legislative Session
Background
CESA’s Board approved a 2018 Legislative Strategy to focus on education and outreach, to be opportunistic as the legislative cycle grinds on, and to play defense where needed. CESA did not plan to sponsor or especially champion any bill or idea for 2018. Thousands of bills were introduced by February 16, 2018 with almost 40 bills that are relevant to CESA members. EVs appear to be a major topic in the 2018 Legislation session.
On May 9, 2018, CESA organized its second-ever Lobby Day. During our meetings with 13 key legislators, staff, and committee members, CESA found that many legislators were well-versed in energy storage but were open to learning more.
Energy Storage Targets & Utility Ownership (SB 1347)
On February 16, 2018, Senator Henry Stern introduced this bill that would direct the CPUC to proportionately add 2,000 MW of additional energy storage procurement across the IOUs and would pre-authorize some level of utility ownership of this additional energy storage procurement quantity if “certain conditions” are met. The bill would also authorize up to 50% of an IOU's allocated portion of the 2,000 MW to be owned by the IOU for energy storage systems procured before December 31, 2030 and up to 35% of an IOU's allocation portion of the 2,000 MW to be owned by the IOU for energy storage systems procured after January 1, 2031. The bill does not allow for IOU ownership of BTM systems. SCE is sponsoring this bill with CESA in support.
On April 25, 2018, the Senate Energy Committee heard the bill, which passed 9-1 but with amendments that changed the focus to all LSEs, rather than just on the IOUs. CESA issued a call to action for members to issue support letters and to show support for the bill. The IOUs and CCAs are now in a negotiation around language. Language on “cost competitiveness” was also added at the request of TURN. Furthermore, at the request of CESA, the bill was amended to require the CPUC to apportion the additional 2,000 MW energy storage procurement requirement by July 1, 2019. The bill was also amended to require the IOUs to propose a schedule of competitive solicitations for third-party-owned projects at the same level as or for greater share than utility-owned projects and to require the CPUC to reconsider procurement strategies and appropriate targets not less than once every three years.
On May 29, 2018, the bill passed through the Senate Floor without amendments. CESA issued a support letter.
On June 27, 2018, the bill was passed unanimously out of the Assembly Utilities & Energy Committee hearing. The bill was working through a number of amendments from TURN, SCE, and CESA. The bill was amended in committee to be more permissive and considered as part of the IRP. The utility-ownership concepts could inadvertently be applied to all of the IRP. Particularly, TURN issued an ‘opposed unless amended’ letter on SB 1347 due to the prescriptive targets set for energy storage without allowing the IRP process to cost-effectively determine the most cost-effective resources. TURN also suggested amendments seek to change the ‘mandate’ language to language that allowed the CPUC to set targets if there is a determination of system need. The amendments maintained the 50% utility ownership limit but lacked details regarding the ‘lock-step’ balance between third-party-owned and utility-owned energy storage procurements. However, language regarding a fast approval of energy storage projects was not accepted; ORA is opposed to fast approval language. CESA conducted outreach to provide feedback that the proposed amendments would defeat the intent of the bill to implement energy storage faster than the IRP would allow. CESA worked on amending the language to return the bill to become more directive and remove any unintended utility ownership issues.
The bill did not emerge from suspense in the Assembly Appropriations Committee. Due to the revamps in the bill, SCE indicated that it could no longer support it.
Long-Duration Bulk Energy Storage Procurement (AB 2787)
On July 5, 2018, Assembly Member Quirk introduced this 'gut-and-amend' bill that would require the CAISO, on or before December 31, 2019, to complete a process for the procurement of long-duration energy storage projects that in aggregate would have at least 1,000 MW but no more than 2,000 MW of capacity. The bill would require the CAISO to develop a methodology for allocating the cost of that procurement to all LSEs within the CAISO-controlled electrical grid. “Long-duration bulk storage project” is defined in the bill as an energy storage resource interconnected to the electrical grid in California that has the capability to discharge at its capacity continuously for at least eight hours and cycle through its discharge and charge cycle on a daily basis.
Since this bill was introduced after the committee deadline, it needed to secure a waiver to go back to the policy committees for hearings in August. CESA took no position on the bill at that time in order to consider the implications and interplay with SB 1347. Key areas of focus for AB 2787 was to address issues around the lack of third-party ownership in the bill and the role of the CAISO in procuring capacity outside of its backstop capacity procurement role (even though the CAISO as a procurement vehicle would support broader allocation of costs across multiple benefiting LSEs).
CESA worked within our Legislative Working Group to consider bill amendments that would broaden the focus of this bill to be more technology neutral while adhering to the original intent of this bill to support large “infrastructure-like” energy storage projects, which face long-lead procurement timelines and require multiple off-takers, among other issues. Ultimately, the bill amendments included clarifying the minimum size threshold for eligibility (500 MW) and clarifying that "bulk storage" definitions in this bill would not be setting any precedents (i.e., ability to cycle daily and discharge continuously for 8+ hours, minimum 40-year asset life, at least 500 MW in project capacity size). Other changes, however, were not accepted in the bill, such as changing the procurement date (from December 31, 2019) to a later date and changing the eligibility from in-state solutions (i.e., “interconnected to the electric grid in California”) to also include out-of-state solutions. CESA considered these amendments to ensure that we adhere to our policy principles around competition and technology neutrality.
On August 27, 2018, the bill received a Senate Rules Committee waiver, which was critical to its continued passage through the Legislative process, given the late introduction of the bill.
On August 29, 2018 the bill was passed through the Senate Appropriations Committee, where the bill analysis discussed how procurement should be pursued through other means rather than through the CAISO’s processes. In other words, the bill was amended slightly to clarify that the CAISO will not own anything. A concern raised in the bill analysis was the role of FERC. CESA’s position on this bill remained neutral but was engaged on this important bill.
However, the bill never passed out of the Legislature and may become a two-year bill.
Self-Generation Incentive Program (SGIP) for Low-Income Customers (AB 2695)
On February 15, 2018, Assembly Member Phil Ting introduced this bill that would shift 2019 and 2020 SGIP funds to a new fund that is geared toward low-income communities, with 40% of these funds reserved for use in utility-owned energy storage projects. This use of funds would be in addition to the already established Equity Budget reserved for disadvantaged communities.
CESA found this bill to be problematic and flawed for dampening competition from third-party energy storage solutions and seriously disrupts the efforts underway in SGIP. Specifically, CESA opposed the bill (as written) because it: (1) targets a customer group that may receive energy storage related benefits via the 500 MW of projects authorized under AB 2868; (2) targets customers for which there is already budgeted SGIP funds; (3) is disruptive to BTM market development in non-low income areas; and (4) may exacerbate concerns about potentially high levels of utility-owned energy storage projects that unreasonably undercut third-party competition.
On April 11, 2018, the bill was amended in the Assembly Utilities & Energy Committee that would instead authorize an additional annual collection of up to $140 million by the three IOUs for SGIP. Up to 40% of these funds would still be reserved for use in utility-owned energy storage projects, while the remaining 60% would be reserved for low-income customers.
Ultimately, and fortunately, this bill never made it out of committee and died.
Energy Storage Initiative (SB 700)
On February 17, 2017, Senator Scott Wiener introduced a bill that would establish the Energy Storage Initiative (ESI) with funds collected from 2018 to 2027 at current levels (i.e., approximately $166 million per year). Some of the funding is directed toward low-income projects, services, and areas.
On May 25, 2017, the bill was approved by the Senate Appropriations Committee with amends that included a 30% carve-out of incentive funds for disadvantaged communities. Many of the edits focus on clarifying and detailing the definition of ‘disadvantaged communities’ and on establishing clearer eligibility for multi-family homes. Finally, the amendments appear to make projects eligible for this storage incentive program in addition to AB 693 funds.
On July 12, 2017, the bill was pulled by Chair Chris Holden in the Assembly Utilities & Energy Committee and was thus not heard in the hearing. The bill will therefore no longer proceed in this legislative session and now becomes a 'two-year' bill that could be viable next year.
On June 20, 2018, the bill re-emerged and was passed through the Assembly Utilities & Energy Committee but with amendments to direct the five-year extension of SGIP. Specifically, the bill would extend the collection of SGIP to December 31, 2024 at $166 million per year and the administration of the program to January 1, 2026.
On September 27, 2018, the bill was signed by the Governor. The bill faced opposition from PG&E and SCE, which led to some amendments guarding against the GHG impacts of energy storage. A key change in the bill was the requirement that the CPUC adopt requirements for energy storage systems to reduce GHG emissions and removal of problematic “efficiency” provisions. CESA submitted a support letter and was active in cleaning up some of the problematic wording in the amendments. The bill was then passed through Assembly Appropriations Committee (August 16) and Assembly Floor (August 29) before being signed by the Governor.
100% RPS (SB 100)
On January 11, 2017, Senate Pro Tempore Kevin de Leon introduced this bill that expands advanced energy growth by requiring the state's investor-owned utilities to meet a 100% RPS by 2045 and a 50% RPS by 2025. The impetus for this bill is that California is already well on its way to achieving its existing RPS targets. Notably, this bill does not require achievement of this aspirational goal but to achieve 100% reliance on eligible RPS resources as a “planning goal and regulatory requirement”. In addition, the allowance of “zero-carbon generating facilities” may open the door for accommodating large hydroelectric facilities, which do not qualify as RPS-eligible resources under current rules.
On May 31, 2017, the bill was passed through the Senate Floor.
On September 1, 2017, the bill advanced through the Assembly Appropriations Committee, but emerged with provisions that limit third-party competition for providing distribution services. Labor groups pushed for these amends, which stipulates that distribution investment deferral with DERs not be allowed until an evaluation of ongoing DRP/IDER pilot projects is reported to the relevant Senate and Assembly committees. CESA has opposed the amendments but supported the other provisions and requirements of SB 100. The bill died in the Assembly.
On July 3, 2018, the bill was revived and passed through the Assembly Utilities & Energy Committee with amendments that added municipal-related provisions and did not include anti-DER amendments. The bill was amended to set RPS targets for IOUs, CCAs, POUs, and ESPs to achieve 44% by December 31, 2026, 52% by December 31, 2027, and 60% by December 31, 2030. Finally, the bill would require 100% of retail sales of electricity to come from renewable energy and zero-carbon resources by December 31, 2045, while also requiring the CPUC to ensure that GHG emissions do not increase elsewhere in the Western grid (i.e., no resource shuffling pursuant to the Dormant Commerce Clause).
On August 28, 2018, the bill was passed through the Assembly Floor and through the full Legislature, which occurred in part due to the failure of AB 813 that could have been part of a bigger deal.
On September 10, 2018, ahead of the Governor’s Climate Action Summit, the Governor signed the bill into law. The state agencies will not be tasked with maintaining and protecting the safety, reliable operation, and balancing of the electric system, preventing unreasonable rate impacts, and adopting policies and actions in other sectors to obtain GHG reductions in pursuit of the 100% goal. No changes were made to the rules, oversight, and enforcement of the California RPS Program. These agencies will also need to issue a joint report on January 1, 2021, and every four years thereafter, to review various policies, potential benefits and impacts on system and local reliability, anticipated financial costs and benefits to utilities and customers, barriers to achieving the policy, and alternative scenarios to achieve the policy.
Expedited RPS Procurement / Regionalization (AB 813)
On February 15, 2017, Assembly Member Chris Holden introduced this bill that directs the CPUC to require LSEs to procure RPS resources that are eligible for the federal production tax credit or investment tax credit and that are over and above those resources necessary to meet the procurement requirements for the applicable compliance period if the CPUC determines that earlier-than-required procurement would reduce the overall long-term expense of procuring these RPS resources. The bill would provide that the procurement of additional RPS resources be on behalf of all retail end-use customers and be recovered through non-bypassable charges. Specifically, the bill focuses on revising one CPUC code section.
On August 31, 2017, the bill became public. The bill does not include energy storage, which raises the risk that expedited RPS procurements will prompt more curtailments. This bill may be intended to give the CPUC “cover” to procure RPS resources earlier to take advantage of the expiring PTC and ITC.
On June 6, 2018, AB 813 was amended that added a focus on authorizing the transformation of the CAISO into a regional organization if the CAISO Board undertakes "certain steps". The amended bill would prohibit the CAISO from implementing the new governance structure prior to January 1, 2021, among other changes. Overall, the amendments maintain the bill as a “regionalization bill” that focuses on the evolution of the CAISO into a regional ISO, with appropriate governance structures in place. CESA continues to monitor this area, but party opposition from labor and TURN are not expected to be resolved.
On June 19, 2018 and June 26, 2018, the bill was passed through the Senate Energy, Utilities, & Communications and Senate Judiciary Committees, despite facing some opposition.
On August 13, 2018, the bill was put on suspense in the Senate Appropriations Committee due to concerns about how market expansion could hamper progress on the state’s climate goals.
Early Geothermal, Bioenergy, and RPS Procurement (AB 893)
On February 16, 2017, Assemblymember Eduardo Garcia introduced this bill that would direct procurement for existing and new geothermal and bioenergy resources as well as renewable resources eligible for specified Federal tax credits. Specifically, a statewide total of 5,000 MW would be directed for procurement by May 31, 2019, with specifications for about 1,750 MW of geothermal energy, 525 MW of bioenergy projects, and at least 1,675 MW of tax-advantaged renewable resources over the next decade.
On May 18, 2017, the bill passed the Assembly Floor but was placed on suspense due to pushback to allow the IRP process to take shape.
On June 27, 2018, the bill was revived in the Senate Energy, Utilities, & Communications Committee with amendments to reduce the statewide total procurement amount to 4,250 MW of qualified renewable energy resources and to remove the bioenergy projects (i.e., “renewable natural gas”) from this bill due to two other biogas-related bills passing through this session.
On August 16, 2018, the bill passed the Senate Appropriations Committee but was never brought up for a full vote on the Senate Floor, thus killing this bill.
Distribution Safety & Reliability Planning (SB 1088)
On February 12, 2018, Senator Dodd introduced this bill that would require the IOUs to submit biennial safety, reliability, and resiliency plans and authorize them to propose utility investments, such as microgrids and infrastructure hardening, that would address any risks for extreme weather events. Importantly, the bill would not allow for any third-party solutions to address risks identified in these plan – i.e., restricting any use of DERs or contracting non-traditional labor-related contracting to provide DERs.
On April 17, 2018, the bill passed the Senate Energy, Utilities & Communications Committee but faced broad opposition due to the “poison pill” that would block out third-party DER providers from providing distribution reliability. CESA’s position was opposed unless amended. CESA was careful in its positioning on this bill, which was backed by labor groups and was developed in part as a response to the Governor’s Office and its focus on disaster planning improvements and updated utility reliability rules. CESA issued a call to action to call legislators to oppose the anti-DER provisions of SB 1088.
On May 30, 2018, the bill passed through the Senate Floor with amendments to remove the anti-DER provisions and allow the IOUs to contract with third-party DER providers so long as certain “insurance requirements” are met for any direct damages caused by the failure of DER equipment. CESA now has no position on this bill but is no longer opposed, as it moves to the second house.
On June 20, 2018, the bill was passed through the Assembly Utilities & Energy Committee and subsequently approved in the Assembly Governmental Organization Committee (June 28, 2018) but was never heard in the Assembly Appropriations Committee.
Microgrid Resiliency (SB 1339)
On February 16, 2018, Senator Stern introduced this bill that would direct each LSE to submit an electrical grid resiliency deployment plan that minimizes costs and maximizes benefits in applications in a new proceeding by July 1, 2019. Energy storage is eligible to be part of approved microgrids but diesel or gas-combustion generation is not allowed.
On April 17, 2018, the bill was passed the Senate Energy, Utilities, & Communications Committee with amendments that would require the development of a microgrid tariff (instead of a deployment plan) to establish the use of microgrids for electric grid resiliency. The tariffs would need to be submitted via advice letter by January 1, 2020 and the parameters for eligible microgrids and the associated tariff would need to be developed as part of the NEM proceeding (R.14-07-002). The bill would also require a streamlining of interconnection standards and permitting to reduce cost barriers to microgrid development. Importantly, the bill was also amended to not only allow for IOU and POU ownership of microgrids, but also allow for CCA and third-party ownership. The bill would require CPUC to act on the requirements by December 1, 2020 in consultation with the CEC and CAISO.
On May 29, 2018, the bill passed through the Senate Floor with amendments that now allow for third-party ownership. CESA issued a support letter as amended. The IOUs opposed the bill as duplicative and potentially causing cost shifts to low- and middle-income customers.
On June 27, 2018, the Assembly Utilities & Energy Committee passed the bill with strong support, with CESA testifying in support as well. The bill was amended to also require POUs that serve more than 700,000 customers to also develop a process for interconnection of customer-supported microgrids and to make this process available by January 1, 2020. The bill also specified actions to be taken, including development of microgrid service standards, methods to reduce cost barriers for microgrid interconnection requirements (including for DC metering), and guidelines that determine what impact studies are required to interconnect microgrids. Specifically, the bill was amended to include:
Formation of a working group to codify standards and protocols to meet utility and grid operator microgrid requirements
Rule that makes available within 180 days an interconnection process from when a customer or developer first requests establishing a microgrid
Prohibition on compensation for backup generation, if separate rates and tariffs are necessary, unless generation is used as backup generation for a healthcare facility
Language that prohibits IOUs from discouraging development or ownership of microgrids
On September 19, 2018, the bill was signed by the Governor. Previously, the bill passed the Assembly Appropriations Committee (August 16) and Assembly Floor (August 31) to make it fully out of the Legislature.
Clean RA Requirements (SB 1136)
On February 13, 2018, Senator Hertzberg introduced this bill that would align the RA requirements to the state’s clean energy goals and support the use of DR resources to meet or reduce RA requirements. Currently, the RA program does not have tie RA requirements to the state’s clean energy goals or establish any loading order concept.
On April 25, 2018, the bill passed through the Senate Energy, Utilities, & Communications Committee that was amended with language the required efficient and equitable means for LSEs to achieve its RA requirements. Language was also added that required that the CPUC also minimize the need for CAISO backstop procurement in revising the RA requirements. CESA voiced its support for the bill because it would likely favor energy storage as an RA resource and support an outcome where RA not only ensures a workable fleet for operating the grid but also a fleet that is in line with the state’s clean energy goals.
On May 17, 2018, the bill passed through the Senate Floor. CESA submitted a support letter for the bill and successfully amended the bill to explicitly list non-generating resource and hybrid resource concepts. CESA’s goal was to make sure that energy storage in all configurations, including hybrid energy storage systems, is appropriately valued.
On September 27, 2018, the bill was signed by the Governor. Previously, the bill was passed through the Assembly Appropriations Committee (August 8) and the Assembly Floor (August 16).
Diablo Canyon Settlement Adoption (SB 1090)
On February 12, 2018, Senator Monning introduced this bill that would direct the CPUC to adopt the Diablo Canyon Joint Settlement as the Diablo Canyon Power Plant is planned for full decommissioning in 2024 and 2025. NRDC is supporting this bill. Since the joint settlement was not approved by the CPUC, the joint parties of the settlement pursued a legislative path to approving the settlement.
On April 18, 2018, the bill passed through the Senate Environmental Quality Committee with some bi-partisan support. The bill was amended to require full funding of the community impact mitigation settlement and the employee retention program, which was partially approved in the decision for A.16-08-006. The bill also added language that specified how the retirement of Diablo Canyon cannot lead to an increase in GHG emissions. Though the CPUC already made similar determinations, the Legislature has made it a statutory requirement in effect.
On August 20, 2018, the bill was approved on the Assembly Floor and thus moved out of the Legislature, with overwhelming support and without amendments.
On September 19, 2018, the bill was signed by the Governor, which restored restore hundreds of millions of dollars of worker retraining and community support from the original settlement agreement in A.16-08-006 and ensured that IRPs are designed to avoid any increase in GHG emissions as a result of the Diablo Canyon retirement. Previously, the bill passed through the Assembly Appropriations Committee (August 8) and Assembly Floor (August 20) with overwhelming support.
Green Hydrogen Pilots & IRP Consideration (SB 1369)
On February 16, 2018, Senator Nancy Skinner (with Senator Hertzberg as a co-author) introduced this bill that would direct the development of five pilots for green hydrogen and for consideration of green hydrogen in the IRPs. Specifically, “green hydrogen” would be defined in this bill as hydrogen gas produced through electrolysis but would exclude hydrogen gas manufactured using steam reforming or some other conversion technology that produces hydrogen from a fossil fuel feedstock.
On May 29, 2018, the bill passed with full support and some amendments on the Senate Floor. CESA issued a support letter to support its passage. The bill was amended to reduce the number of pilots to three and replaced “green hydrogen” language to “electrolytic hydrogen”.
On June 25, 2018, the bill passed through the Assembly Natural Resources Committee with amendments to require the IRP filings submitted after January 1, 2021 to consider the existing and potential uses for green electrolytic hydrogen in meeting the statewide GHG emissions limits.
On August 16, 2018, the bill was amended and passed through the Assembly Appropriations Committee, with language that was added for more permissive IRP consideration as an eligible form of energy storage but also eliminated the development of pilots.
On September 19, 2018, the bill was signed by the Governor, after previously passing through the Assembly Floor on August 31.
Electricity Direct Access (SB 237)
The direct access program has had constraints put on it due to historic concerns around the 2001 energy crisis. The program was suspended in 2001 but was only reopened on a limited basis with the 2009 passage of SB 695. Currently, 24,000 GWh of load can be served by energy service providers. The direct access market is currently estimated around 13%.
On February 6, 2017, Senator Hertzberg introduced this bill that would require the CPUC to adopt and implement a second phase-in period for expanding direct access over a period of not more than three years, so that by the end of the three-year period all non-residential end-use customers may acquire electric service from other providers. Previously, the CPUC established a maximum allowable annual limit for access to direct access. Thus, in this bill, the CPUC will adopt a schedule for a second phase-in of direct access by raising the allowable limit of kWh supplied by direct-access electric service providers and by ultimately eliminating the allowable limit. CESA has no position on this bill but it would open up the customer choice issue even further, which the CPUC has been confronting when it comes to managing resource planning and grid reliability to achieve the state's energy and climate goals. In particular, this may open up competition to the CCAs and IOUs alike.
On June 28, 2017, the bill passed through the Assembly Appropriations Committee, after having passed fully through the first house (Senate), but was ultimately suspended. This bill became a two-year bill.
On June 27, 2018, the bill was approved by the Assembly Utilities & Energy Committee after being re-introduced and amended on June 13, 2018, despite concerns about potential negative bill impacts. By June 1, 2019, the CPUC would be required to issue an order increasing the annual maximum allowable total kWh limit by 4,000 GWh for direct transactions for non-residential end-use customers, increasing the direct access market to around 15.5%. By July 2020, the CPUC will be required to submit a report to the Legislature on whether it should consider a reopening of the direct access program. The CPUC is required to consider GHG emission reduction goals, system reliability, and cost shifting issues when issuing its recommendation.
On August 30, 2018, the bill was approved in the second house (Assembly) and thus the full Legislature.
On September 19, 2018, the bill was signed by the Governor that would slightly increase the cap in place and set a course for the CPUC to start a proceeding on whether or not to expand its direct access program.
Zero-Emissions Building (AB 3001)
On February 16, 2018, Assembly Member Bonta introduced this bill that would require the CEC to require new residential and nonresidential buildings to be electric-ready buildings starting in 2022 and to develop GHG-related standards for new residential and nonresidential buildings. In addition, the bill would direct the CPUC to make thermal storage and EV charging eligible for AB 2514 energy storage procurements.
On April 3, 2018, the bill was amended in the Assembly Natural Resources Committee. While in support of EVs, CESA was concerned that this bill would muddy the procurement paths for EVs through programs and incentives with energy storage through the AB 2514 energy storage procurement framework. CESA worked with the author to remove this part of the bill. Instead, the bill would direct the CPUC to create or update incentive programs that encourage the transition to space heating, water heating, and other low-emissions heating technologies in residential and non-residential buildings.
TOU Hardship Exemption (AB 2569)
On February 15, 2018, Assembly Member Arambula introduced this bill to require the CPUC to consider potential for hardship on low-income and disadvantaged communities before authorizing default residential time-of-use (TOU) rates on these customers.
On April 3, 2018, the bill was amended in the Assembly Utilities & Energy Committee that specified the conditions for putting residential customers on default TOU rates. Specifically, residential customers in hot climate zones who are projected to experience bill increases of at least 20% in two or more summer months are exempted from default TOU rates. Furthermore, the bill would require customers with two years of bill protection, as opposed to one year.
EV Infrastructure Roadmap (AB 2127)
On February 8, 2018, Assembly Member Phil Ting introduced this bill to task the CEC with developing an EV infrastructure roadmap to identify the actions needed to help the state achieve its GHG emissions reduction goal (40% below 1990 levels by 2030) through the adoption of EVs. The CEC would be directed to work with the CPUC and ARB to coordinate implementation of this roadmap.
On April 23, 2018, the Assembly Transportation Committee passed the bill but with a few refinements to additionally connect the roadmap to the zero-emission vehicle (ZEV) goals – i.e., at least 5 million ZEVs on California roads by 2030. The bill was also amended to require the CEC to conduct a biennial update to the statewide assessment of EV charging infrastructure needed.
On August 27, 2018, the bill passed the Senate Floor and thereby the full Legislature.
ZEV Use by Transportation Network Companies (SB 1014)
On February 6, 2018, Senator Nancy Skinner introduced this bill that would establish a Clean Miles Standard and Incentive Program for ZEV use by transportation network companies (TNCs), with the goal of having 20% of passenger miles by TNCs provided by ZEVs by December 31, 2020, 50% by December 31, 2023. The bill would require the CPUC to establish quarterly targets for the portion of vehicle miles traveled by ZEVs on behalf of a TNC. The bill would require, beginning January 1, 2030, that 100% of the vehicles that are purchased, leased, owned, or contracted for by a TNC be ZEVs.
On April 17, 2018, the bill passed through the Senate Energy, Utilities, & Communications with amends to the target dates to be pushed to later dates. Specifically, it amended the bill to set the goal of having 20% of passenger miles by TNCs provided by ZEVs by December 31, 2023 (instead of December 31, 2020) and 50% by December 31, 2026 (instead of December 31, 2023).
On May 14, 2018, the bill passed the Senate Appropriations Committee but was subsequently placed on suspense.
RPS Waivers / Wildfire Expense Accounts (AB 2346)
On February 13, 2018, Assembly Member Bill Quirk introduced this bill that would tighten requirements for retail sellers who get some RPS requirements waived, which, when waived, would require retail sellers to replace generation with consideration of reducing environmental impacts.
On April 18, 2018, the bill was heavily amended to focus on authorizing the IOUs to establish wildfire expense memorandum accounts for costs relating specifically to the 2017 California wildfires and to record certain costs in those accounts. The bill has thus been completely redirected for a different purpose.
Clean Cars by 2040 (AB 1745)
On January 3, 2018, Assembly Member Phil Ting introduced this bill that would prohibit any new motor vehicle registration unless the vehicle is a zero-emission vehicle(ZEV) while establishing exemptions for some vehicles as part of these rules.
On April 16, 2018, the author pulled the bill from committee and the bill was never heard.
2017 Legislative Session
Background
The 2017 legislative session will be a critical year to get energy storage on the minds (and in the hearts) of our State Legislators and policy leaders. Overall, CESA believes there are several likely supporters of clean energy interests with chair positions on select legislative committees. Key energy storage champions remain or were recently elected to office, including Nancy Skinner, a long-time advocate for clean energy.
On February 8, 2017, CESA’s Board approved a legislative ‘staff proposal’ to support the following bills and develop these ideas further.
Aliso Canyon Diversification Bill (SB 801)
On February 17, 2017, Senator Henry Stern introduced this bill that directs more energy storage procurement in the LA Basin to mitigate the impacts of Aliso Canyon Gas Storage Facility limitations. The bill would require LADWP to maximize the use of clean energy resources. Specifically, LADWP is directed to deploy at least 100 MW of additional energy storage capacity in the LA Basin, and SCE is directed to deploy at least 20 MW of additional energy storage capacity in the LA Basin by December 31, 2017. The bill also includes language directing data sharing on grid needs and challenges.
CESA and the Legislative WG reviewed the bill and provided feedback to the author’s office that the procurement timeline is too fast and the locations are overly restrictive. CESA also recommended that the emergency procurement allow for competition of all domains and ownership structures for energy storage solutions, and that fast actions, such as expedited interconnection study and permitting, should be considered. Importantly, the bill does not direct SoCalGas to fund or contract with energy storage projects, which led CESA to recommend SoCalGas add funds to SGIP to leverage the program’s rules to procure an additional 60 MW of behind-the-meter energy storage focused on Aliso Canyon affected areas.
On March 30, 2017, CESA submitted amendments and feedback to the bill, including the following:
Requiring the Commission to make granular data available to developers without violating privacy or confidentiality rules
Amending the LADWP requirement to at least 125 MW of energy storage solutions (instead of 120 MW)
Adding that SoCalGas also procure and deploy at least 60 MW of energy storage solutions
Amending the operational date to July 15, 2018 (instead of December 31, 2017)
Adding that the directed parties adhere to a specific solicitation timeline (30 days for RFP, 30 days for requesting bids, and 60 days for contract negotiation)
Adding that procured energy storage solutions must be dispatchable
On April 10, 2017, CESA submitted support letters for the bill. CESA continues to clarify the language around “deploy” and “cost effectiveness” as well as setting a viable procurement timeline.
On July 12, 2017, the bill passed through the Assembly Utilities & Energy Committee. In response to input by the Committee Consultant, the bill was amended to provide more flexibility to LADWP to determine targets and conduct an upfront cost effectiveness assessment prior to issuance of an RFO, and to allow SCE to consider only energy storage that is cost-effective and needed for reliability. The bill still directs consideration of 100 MW by LADWP and 20 MW by SCE, but the bill now has more permissive language. SCE is allowed to count its 20 MW toward its AB 2868 requirements or other energy storage directives. LADWP continues to strongly oppose having energy storage online by July 1, 2018. With the re-opening of the Aliso Canyon facility, the bill faces a change in importance.
On September 13, 2017, the bill passed through the full Legislature.
On October 14, 2017, the bill was signed and approved by the Governor.
Net-Load Peak Energy (SB 338)
On February 14, 2017, Senator Nancy Skinner introduced a bill that directs the CPUC to consider the concept of ‘clean peak’ and to take action as appropriate. The clean peak concept would potentially set forward-looking obligations that, during each ‘peak hour’, requires a minimum percentage of generation as is required under the California RPS to be sourced from eligible renewable energy (either directly or indirectly through energy storage) by 2030. To meet the clean peak requirement, the bill suggests that CPUC and CEC consider new targets for EE/DR and energy storage.
On April 10, 2017, CESA submitted support letters for the bill. CESA is working to ensure that the clean peak is defined to reflect the role of all solutions, including those that are behind-the-meter.
On July 5, 2017, the bill was approved by the Assembly Utilities & Energy Committee. The bill has been revised to include less binding language on the 'clean peak' while potentially highlighting that utility-owned generation is also eligible. Specifically, the bill calls for consideration in IRPs of meeting system peaking and ramping needs via energy storage as well as energy efficiency, demand response, and renewables. These amends are deemed necessary to get the bill through the Assembly committees and floor.
On September 5, 2017, the bill passed through the full Legislature.
On September 30, 2017, the bill was signed and approved by the Governor.
Clean Peak Energy Standard (AB 1405)
On February 17, 2017, Assemblymember Kevin Mullin introduced a similar bill on the clean peak concept. This bill is more prescriptive than SB 338 (Skinner), although these matters can change as mostly spot language is used currently. It directs the CPUC to determine by December 31, 2018 the actual percentage of kWh delivered by LSEs during a specified 4-hour peak demand period on at least 15 days of any given month.
On April 10, 2017, CESA submitted support letters for this bill.
On May 26, 2017, the bill was approved by the Assembly Appropriations Committee despite opposition from the IOUs and IEP. The author accepted amends to make the bill less prescriptive and more like SB 338.
On September 1, 2017, the bill was passed through the Senate Appropriations Committee, but with the passage of SB 338, this bill did not advance further past the Senate Floor. Senator Skinner and Assembly Member Mullin had been working closely together on both bills and decided to pursue the advancement of one of these two bills, whichever was the “better bill” and/or had the better chance of advancing.
SGIP Successor Concept (AB 1030)
On February 16, 2017, Assemblymember Phil Ting introduced a bill that directs the CPUC to establish a program to incentivize residential and commercial customers to adopt energy storage systems. This initiative may resemble the California Solar Initiative (CSI).
This was an idea proposed last year from Assemblymember Ting, who plans to pursue this idea further in 2017 and is working on language for a bill. While CalSEIA will likely act as the main sponsor, CESA will be a constructive partner that provides helpful feedback to Ting’s Office. For example, CESA is considering how this program can address market segments and customers not well served by SGIP or other existing programs (e.g., low income and disadvantaged communities), and how it could be tied to other statewide objectives, such as its Zero Net Energy Homes goal and EV charging infrastructure deployment.
On April 26, 2017, the bill did not advance through the Assembly Utilities & Energy Committee due to serious opposition from labor. The perception of cost shifting from 'poorer' ratepayers funding a bill that would mostly benefit 'wealthier' ratepayers was one of the key issues with the bill. Another point raised was that SGIP funds were increased last year. Labor groups opposed the bill because they believed that incentive programs may not yield viable companies.
Energy Storage Initiative (SB 700)
On February 17, 2017, Senator Scott Wiener introduced a bill that would establish the Energy Storage Initiative (ESI) with funds collected from 2018 to 2027 at current levels (i.e., approximately $166 million per year). Some of the funding is directed toward low-income projects, services, and areas. The goal of this bill may align with AB 1030 (Ting).
On March 24, 2017, CalSEIA shared revised language on this bill. CESA supported the bill with its proposed amendments.
On April 10, 2017, CESA submitted support letters for the bill.
On May 25, 2017, the bill was approved by the Senate Appropriations Committee with amends that included a 30% carve-out of incentive funds for disadvantaged communities. Many of the edits focus on clarifying and detailing the definition of ‘disadvantaged communities’ and on establishing clearer eligibility for multi-family homes. Finally, the amendments appear to make projects eligible for this storage incentive program in addition to AB 693 funds.
On July 12, 2017, the bill was pulled by Chair Chris Holden in the Assembly Utilities & Energy Committee and was thus not heard in the hearing. The bill will therefore no longer proceed in this legislative session and now becomes a 'two-year' bill that could be viable next year.
Energy Storage Permitting (AB 546)
On February 14, 2017, Assemblymember David Chiu introduced this bill that would create streamlined permitting guidelines for behind-the-meter energy storage. Specifically, the bill would require cities and counties to make documentation and forms accessible online, and to allow for electronic submittal of permitting applications. The Governor’s Office of Planning and Research would also be required to create a California Energy Storage Permitting Guidebook. This was a bill that CESA sponsored in 2016 that stalled in the Assembly Appropriations Committee due to reasons outside of CESA’s control. CESA will again support and advise on the bill concept development.
On April 10, 2017, CESA submitted support letters for the bill.
On September 5, 2017, the bill was passed through the full Legislature, after advancing through the Senate Appropriations Committee by special exemption. The groundwork for funding of the bill via the CEC’s EPIC Investment Plan is well laid. Energy storage permitting and California work are also appreciated by the State Fire Marshall in their adoption of National Electric Code safety provisions, which took effect on July 1, 2017. Cities or counties with populations over 200,000 people must now make all documentation and forms associated with the permitting of advanced energy storage available on a publicly accessible Internet website by September 30, 2018, while smaller cities or counties have until January 30, 2019.
On September 30, 2017, the bill was signed and approved by the Governor.
Non-Wires Transmission Alternative (AB 914)
On February 17, 2017, Assemblymember Kevin Mullin introduced a bill that promotes consideration of non-wires alternatives in transmission planning. The bill specifically directs the CPUC to ensure that its jurisdictional utilities include non-wires alternatives for consideration and select them if they are the most cost-effective or provide net benefits when compared with traditional transmission solutions. The requirement to publicly provide specific data in the transmission planning process is also included in the bill.
On March 17, 2017, amendments to the bill were circulated. There were concerns from the Committee consultant on the language directing the prioritization of non-wires alternatives instead of allowing for equal competition.
On March 22, 2017, CESA submitted support letters for the bill, while SCE and IBEW issued opposition letters.
This bill is now a two-year bill that will not move forward this year, as the author plans to instead focus his efforts on passage of AB 1405.
100% RPS (SB 100)
On January 11, 2017, Senate Pro Tempore Kevin de Leon introduced this bill that expands advanced energy growth by requiring the state's investor-owned utilities to meet a 100% RPS by 2045 and a 50% RPS by 2025. The impetus for this bill is that California is already well on its way to achieving its existing RPS targets. Notably, this bill does not require achievement of this aspirational goal but to achieve 100% reliance on eligible RPS resources as a “planning goal and regulatory requirement”. In addition, the allowance of “zero-carbon generating facilities” may open the door for accommodating large hydroelectric facilities, which do not qualify as RPS-eligible resources under current rules.
On May 31, 2017, the bill was passed through the Senate Floor.
On September 1, 2017, the bill advanced through the Assembly Appropriations Committee, but emerged with provisions that limit third-party competition for providing distribution services. Labor groups pushed for these amends, which stipulates that distribution investment deferral with DERs not be allowed until an evaluation of ongoing DRP/IDER pilot projects is reported to the relevant Senate and Assembly committees. CESA has opposed the amendments but supported the other provisions and requirements of SB 100. The bill died in the Assembly.
Expedited RPS Procurement (AB 813)
On February 15, 2017, Assembly Member Chris Holden introduced this bill that directs the CPUC to require LSEs to procure RPS resources that are eligible for the federal production tax credit or investment tax credit and that are over and above those resources necessary to meet the procurement requirements for the applicable compliance period if the CPUC determines that earlier-than-required procurement would reduce the overall long-term expense of procuring these RPS resources. The bill would provide that the procurement of additional RPS resources be on behalf of all retail end-use customers and be recovered through non-bypassable charges. Specifically, the bill focuses on revising one CPUC code section.
On August 31, 2017, the bill became public. The bill does not include energy storage, which raises the risk that expedited RPS procurements will prompt more curtailments. This bill may be intended to give the CPUC “cover” to procure RPS resources earlier to take advantage of the expiring PTC and ITC.
Expedited RPS Procurement & Regionalization (AB 726)
On February 15, 2017, Assembly Member Chris Holden introduced this bill that directs the formation of a new body - Committee on Regional Grid Transformation (CRGT) - that would be obliged to approve any new updated governance rules developed by the CAISO so long as these new rules meet key requirements. The new body would be chaired by the Governor and composed of the chairs of the CEC, CPUC, ARB, Assembly Utilities & Energy Committee, Senate Energy, Utilities & Communications Committee, an Assembly Member appointed by the Assembly Speaker, and a Senator appointed by the Senate Rules Committee. The CAISO would send any new proposed structure to this new body by October 31, 2018, and the new body would be obliged to review and authorize it by December 31, 2018 if the key criteria are met. If the key requirements or timeline of CAISO are not met, then the current structure remains in place, statutorily. These key criteria include:
New independent governance structure
Advisory committees with representatives from any state with a Participating Transmission Owner (PTO) in CAISO
Process for transitioning from the current to new board structure
Ability to contest transmission cost allocation at FERC or in Court
On September 1, 2017, the bill passed through the Senate Appropriations Committee but did not advance any further. It will likely be considered again next year. The author hopes to move this forward in 2018 but it is unclear how the Governor's Office will weigh in.
Energy Data Transparency (SB 356)
On February 14, 2017, Senator Nancy Skinner introduced another bill that aims to make machine-readable energy data available to developers and the public, without compromising privacy and security. This bill also defines energy storage as among the myriad of new energy technologies that can ‘help’ utilities. AB 1293 (Irwin), which CESA also agreed to support, is a companion bill that requires grid data to be made available electronically. CESA expects some pushback from the utilities and privacy communities.
On April 10, 2017, CESA submitted support letters for the bill.
On May 25, 2017, the bill was approved by the Senate Appropriations Committee after coming off suspense. The bill has been amended but has kept the data provision components of the bill.
On July 5, 2017, the bill was passed through the Assembly Utilities & Energy Committee. CESA signed onto a support letter for this bill in advance of the hearing.
The bill faced opposition heading into the Assembly Appropriations Committee and was put on suspense. The bill now becomes a two-year bill and will not move forward this session. Fiscal, cybersecurity and job loss concerns from the utilities and labor prevented passage of the bill. Amendments to further prevent any disclosure of problematic data will be released. The bill has not moved out of the Legislature.
California EV Initiative (AB 1184)
SB 584, introduced by Assembly Member Phil Ting on February 17, focuses on $3 billion in declining-rate incentives for EVs and for corporations to support EV charging infrastructure from a portfolio of existing funding sources. By establishing the California Electric Vehicle Initiative, the state board will begin a review to adopt revisions to all other specified vehicle electrification programs to ensure those programs consider funding benefits for disadvantaged and low-income individuals. The bill would also require the state board to annually develop and approve a low-carbon transportation funding plan and to provide access to grid-support rate options.
On May 30, 2017, the bill was passed through the Assembly Floor.
On September 1, 2017, the bill was passed through the Senate Appropriations Committee but with amendments to remove the incentive program and to direct the ARB to conduct a lengthy study on the issue of EV rebates. The bill has not moved out of the Legislature.
Sales & Use Tax Exemption for Energy Storage (AB 398)
On February 9, 2017, Assemblymember Eduardo Garcia introduced this bill that specifies some key changes to the cap-and-trade mechanism and would extend a sales and use tax exemption on manufacturing for a few years, which would apply to energy storage and distribution (see Section 16). Presumably, the bill would help reduce costs in deploying energy storage in California for certain kinds of ‘persons’.
On July 17, 2017, CESA provided support for this bill with a support letter with suggested amendments to be expanded to energy storage projects that sell into some kind of project finance fund (by adding NAICS codes 525910 and 525990 to the bill), as well as energy storage that is owned at the residential customer level.
On July 17, 2017, the bill was fully passed through the Legislature due to the need to finalize cap-and-trade bills. Generally, stability toward GHG goals is good for energy storage. Politically, passage of this bill involved significant negotiations from many sides. The agriculture industry was successful in getting some sales and use tax exemptions. Environmental justice concerns were also raised, which led to support for a companion bill.
Some NAICS codes for energy storage companies were also authorized for sales and use tax. CESA was unsuccessful in expanding the list of NAICS codes eligible (525910 and 525990) for the sales and use tax exemption. In summary, if the final owner of the energy storage system is residential or a project finance fund, the project is not eligible for the exemption. If the final owner of the energy storage system is involved in some kind of manufacturing or energy generation (e.g., operators of power plants), or is a distribution utility, the project qualifies for the exemption. Storage developers who also develop generation (e.g., solar plants, gas plants) and are retaining ownership of the energy storage system, or storage developers selling to generation developers for the generators to own and pair with their generation projects, the exemption applies. Standalone storage developers "selling" into project finance funds or entities do not benefit from the exemption. It is unclear when the sales and use tax exemption will occur. Some regulatory process will needed prior to implementation.
Green Tariff Shared Renewables Program Expansion (AB 1573)
On February 17, 2017, Assemblymember Richard Bloom introduced this bill that authorizes the consideration of expanding the 600 MW Green Tariff Shared Renewable (GTSR) Program. The bill would define ‘eligible renewable energy resource’ to include energy storage systems that are charged solely by eligible renewable energy. CESA decided to remain silent on this bill and simply monitor it at this time. Important context for this bill is that California’s Community Solar Program was poorly implemented (SB 43). To some, a concern with the bill is that it continues the existing program which has some weaknesses and may not sufficiently address the problems that need to be fixed. Modifications to the GTSR Program would be required (by the utilities) by March 1, 2018.
On April 26, 2017, the bill was passed through the Assembly Utilities & Energy Committee and was significantly amended.
On May 30, 2017, the bill was passed through the Assembly Floor, but did not advance any further.
Funding for Nonprofit Intervention at FERC and CAISO (SB 520)
On February 16, 2017, Senator Holly Mitchell introduced a bill that would establish a new state program called the California Consumer Participation Initiative (CalCPI) to enable the participation of non-profit consumer, environmental, and public health organizations at the CAISO and FERC. The program would be administered by the CEC and available to California-based nonprofits that demonstrate financial hardship and represent the interests of residential or small business customers located within California.
CESA will remain silent and is only tracking/monitoring this bill at this time. Some CESA members may have concerns with this bill, as regulating and managing intervenor compensation is tricky and has been exploited at times.
On April 4, 2017, this bill was heard by the Senate Energy, Utilities & Communications Committee. The bill was put in 'suspense' by the Senate Appropriations Committee. The price tag is listed at several million dollars per year.
On September 1, 2017, the bill was heard in the Assembly Appropriations Committee but was held from hearing. The bill did not move through the Legislature.
2016 Legislative Session
Background
CESA focused this year on relationship building and leveraging the PAC. CESA continued to build its presence and relationships in Sacramento, played more of a role at fundraisers, promoted somewhat smaller ideas for wins and visibility, looked for bigger wins down the road, and planned for some defensive actions in 2016. Overall, 2016 was a successful session as CESA helped pass four energy storage relevant bills.
C&I and Low-Income Storage Deployment (AB 2868)
AB 2868, the Gatto bill, directs the CPUC and the IOUs to explore up to 500 MW of new distributed energy storage programs (in addition to the SGIP and the AB 2514 goals) with deployments first to low-income, commercial, and industrial customers, and then to residential customers. The bill seeks to direct action quickly and then to sunset any resulting programs by 2020.
The bill has been amended to allow for utility-owned applications for distributed energy storage investments. Alignment among the IOUs, CPUC, and the Governor’s Office led to support for some potential exploration of more utility-directed distributed energy storage. Given this shared sentiment by other parties, CESA proactively engaged SDG&E and the Governor’s Office to ensure that any bill language around utility ownership of behind-the-meter assets is fair and reasonable - i.e., preserves third-party competition and non-discrimination. CESA met with the Governor’s Office along with other parties on August 18 to discuss proposed amended language.
Passing out of the Senate Floor on August 31, the bill now awaits the Governor's signature. CESA will now begin to focus on messaging and framing of what AB 2868 means for energy storage.
Interconnection Bill (AB 2861)
CESA helped design and support AB 2861, the Interconnection Dispute Resolution Process Bill, which focuses on interconnection challenges in municipalities. The bill establishes a CPUC-administered technical expert panel to arbitrate interconnection disputes. Prior to this bill, interconnection disputes were handled by the IOUs' ombudsman.
AB 2861 advanced through the Senate Floor vote and proceeds to the Governor for signature or veto. Throughout the legislative process, CESA has been working with the author, Assembly Member Ting, to retain the focus and basic idea of this bill.
SGIP Trailer Bill (AB 1612)
Governor Brown has included an amendment in his Budget Trailer Bill to double the SGIP funding for the remaining years of the program (approximately $290M in incremental funding). The doubling of SGIP funds was then stripped out of AB 1612 and put into AB 1637 instead.
AB 1637 was approved on the Senate Floor on August 22 and on the Assembly Floor on August 31. The bill now awaits the Governor's signature.
Quirk Storage Bill (AB 33)
AB 33 directs 'study' consideration of the role of bulk storage, including pumped hydro storage (PHS). The bill specifically references a CEC report on bulk storage which provides helpful context on the roles and potential procurement pathways for bulk storage.
Initially, AB 33 sought to remove the 50 MW minimum requirements for PHS eligibility in any Storage OIR procurements, but only if the AB 2514 target is increased from 1,325 MW. In its Storage OIR Track 2 Scoping Memo Comments, CESA recommended a fourth procurement bucket of 1,000-1,500 MW, and CESA may recommend PHS only count for a certain capped percentage of any new Storage OIR targets. The San Diego Water Authority (which wants to expand its PHS resources) and other CESA members support this bill. The bill has since been amended to become a 'study' bill.
The bill passed through the Legislature and now awaits the Governor's signature.
California System Efficiency, Reliability, & Diversity Act (CSERDA) of 2017
CESA has been informally asked by the Governor’s Office to expand our thinking on new storage-focused legislation that can also help accelerate EV adoption in California. As a result, CESA’s ‘big bill’ idea is being drafted with the Legislative WG and is working with partner organizations representing the EV, environmental, and low-income communities to strengthen this longer-term idea. CESA plans to have CSERDA developed for the 2017 legislative session.
CESA convened EV-focused members to brainstorm the idea further on August 4. The purpose of this meeting was to discuss barriers, challenges and specific pathways forward to leveraging energy storage and EV charging toward achieving a cleaner, a more resilient electric power system in California. This work feeds into ideas to have a comprehensive grid transformation idea that could inform legislation and address transportation GHG emissions challenges. With the recent passage of SB 32, which directs further GHG emissions reductions for California, the need to electrify the transportation sector will increase.
Pavley Storage Bill (SB 886)
The Pavley Bill directs electric corporations to develop a suite of approaches that promote energy storage deployments. First, it establishes a preferred load order position for energy storage in the IRP. Second, it directs electrical corporations to develop tariffs or programs to provide incentives to customers to install grid-connected, behind-the-meter energy storage. Third, it requires the CPUC to consider updating the current targets for each LSE to procure viable and cost-effective energy storage achievable by 2030.
SB 886 was driven by CESA’s support letters and constructive dialogue with Senator Pavley, Committees, and Legislators. Advancing through the legislature, SB 886 was amended to focus more on its loading order concept, but retained language on an energy storage target, if determined by the CPUC. The bill faced firm opposition from utilities based on how the bill conflicts with the IRP and because it appears to raise costs and be duplicative of other bills. CESA offered further ideas on how to shape the legislation to potentially ease utility concerns.
On August 11, 2016, SB 886 ‘died’ as it failed to pass through the Appropriations process, which is where many bills falter. The reasons for bill’s demise are under review, but from CESA's initial intelligence gathering, the bill may have died because of the focus by legislators on other higher-priority bills, such as SB 32.