AB 2460: Solar thermal systems.
- Session Year: 2015-2016
- House: Assembly
- Latest Version Date: 2016-06-14
The Solar Water Heating and Efficiency Act of 2007, until August 1, 2017, requires the Public Utilities Commission, if it determines that a solar water heating program is cost effective for ratepayers and in the public interest, to implement a program to promote the installation of 200,000 solar water heating systems in homes, businesses, and buildings or facilities of eligible customer classes receiving natural gas service throughout the state by 2017. The act establishes the maximum funding for the program, for the collective service territories of all gas corporations, at $250,000,000. The act, until August 1, 2017, requires the governing body of each publicly owned utility providing gas service to retail end-use customers to adopt, implement, and finance a solar water heating system incentive program to encourage the installation of 200,000 solar water heating systems by 2017.
This bill would revise the program to, among other things, promote the installation of solar thermal systems throughout the state, set the maximum funding for the program between January 1, 2017, and July 31, 2022, at $250,000,000, reserve 50% of the total program budget for the installation of solar thermal systems in low-income residential housing or in buildings in disadvantaged communities, and extend the operation of the program through July 31, 2022. Because a violation of any order, decision, rule, direction, demand, or requirement of the commission implementing these revisions would be a crime, this bill would impose a state-mandated local program. The bill would also require the governing body of each publicly owned utility providing gas service, until August 1, 2022, to adopt, implement, and finance a solar thermal system incentive program. Because the bill would extend the obligations of a publicly owned electric utility to adopt, implement, and finance the program, this bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for specified reasons.
The Solar Water Heating and Efficiency Act of 2007, until August 1, 2017, requires the Public Utilities Commission, if it determines that a solar water heating program is cost effective for ratepayers and in the public interest, to implement a program to promote the installation of 200,000 solar water heating systems in homes, businesses, and buildings or facilities of eligible customer classes receiving natural gas service throughout the state by 2017. The act establishes the maximum funding cap for the program, for the collective service territories of all gas corporations, at $250,000,000. The act, until August 1, 2017, requires the governing body of each publicly owned utility providing gas service to retail end-use customers to adopt, implement, and finance a solar water heating system incentive program to encourage the installation of 200,000 solar water heating systems by 2017.
This bill would revise the program to, among other things, promote the installation of solar thermal systems throughout the state, set the maximum funding cap for the program between January 1, 2017, and July 31, 2027, 2022, at $1,000,000,000, $250,000,000, reserve 50% of the total program budget for the installation of solar thermal systems in low-income residential housing or in buildings in disadvantaged communities, and extend the operation of the program through July 31, 2027. 2022. Because a violation of any order, decision, rule, direction, demand, or requirement of the commission implementing these revisions would be a crime, this bill would impose a state-mandated local program. The bill would also require the governing body of each publicly owned utility providing gas service, until August 1, 2027, 2022, to adopt, implement, and finance a solar thermal system incentive program. Because the bill would extend the obligations of a publicly owned electric utility to adopt, implement, and finance the program, this bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for specified reasons.
The Solar Water Heating and Efficiency Act of 2007, until August 1, 2017, requires the Public Utilities Commission, if it determines that a solar water heating program is cost effective for ratepayers and in the public interest, to implement a program to promote the installation of 200,000 solar water heating systems in homes, businesses, and buildings or facilities of eligible customer classes receiving natural gas service throughout the state by 2017. The act establishes the funding cap for the program, for the collective service territories of all gas corporations, at $250,000,000. The act, until August 1, 2017, requires the governing body of each publicly owned utility providing gas service to retail end-use customers to adopt, implement, and finance a solar water heating system incentive program to encourage the installation of 200,000 solar water heating systems by 2017.
This bill would revise the program to, among other things, promote the installation of solar water thermal systems throughout the state, set the funding cap for the program between January 1, 2017, and July 31, 2027, at $1,000,000,000, reserve 50% of the total program budget for the installation of solar water heating thermal systems in low-income residential housing or in buildings in disadvantaged communities, and extend the operation of the program through July 31, 2027. Because a violation of any order, decision, rule, direction, demand, or requirement of the commission implementing these revisions would be a crime, this bill would impose a state-mandated local program. The bill would also require the governing body of each publicly owned utility providing gas service, until August 1, 2027, to adopt, implement, and finance a solar water heating thermal system incentive program. Because the bill would extend the obligations of a publicly owned electric utility to adopt, implement, and finance the program, this bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for specified reasons.
The Solar Water Heating and Efficiency Act of 2007, until August 1, 2017, requires the Public Utilities Commission, if it determines that a solar water heating program is cost effective for ratepayers and in the public interest, to implement a program to promote the installation of 200,000 solar water heating systems in homes, businesses, and buildings or facilities of eligible customer classes receiving natural gas service throughout the state by 2017. The act establishes the funding cap for the program, for the collective service territories of all gas corporations, at $250,000,000. The act, until August 1, 2017, requires the governing body of each publicly owned utility providing gas service to retail end-use customers to adopt, implement, and finance a solar water heating system incentive program to encourage the installation of 200,000 solar water heating systems by 2017.
This bill would revise the program to, among other things, promote the installation of solar water systems throughout the state, set the funding cap for the program between January 1, 2017, and July 31, 2027, at $1,000,000,000, reserve 50% of the total program budget for the installation of solar water heating systems in low-income residential housing or in buildings in disadvantaged communities, and extend the operation of the program through July 31, 2027. Because a violation of any order, decision, rule, direction, demand, or requirement of the commission implementing these revisions would be a crime, this bill would impose a state-mandated local program. The bill would also require the governing body of each publicly owned utility providing gas service, until August 1, 2027, to adopt, implement, and finance a solar water heating system incentive program. Because the bill would extend the obligations of a publicly owned electric utility to adopt, implement, and finance the program, this bill would impose a state-mandated local program.
The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.
This bill would provide that no reimbursement is required by this act for specified reasons.
Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations, as defined. Decisions of the commission adopted the California Solar Initiative. Existing law requires the commission to undertake certain steps in implementing the California Solar Initiative.
This bill would make a nonsubstantive change to the law requiring the commission to undertake certain steps in implementing the California Solar Initiative.
Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations, as defined. Decisions of the commission adopted the California Solar Initiative. Existing law requires the commission to undertake certain steps in implementing the California Solar Initiative.
This bill would make a nonsubstantive change to the law requiring the commission to undertake certain steps in implementing the California Solar Initiative.
As used in this article, the following terms have the following meanings:
(a)Disadvantaged community means a community identified by the California Environmental Protection Agency pursuant to Section 39711 of the Health and Safety Code.
(b)Gas customer includes both core and noncore customers, as those terms are used in Chapter 2.2 (commencing with Section 328) of Part 1, that receive retail end-use gas service within the service territory of a gas corporation.
(c)kWth or kilowatts thermal means the unit of measure of the equivalent thermal capacity of a solar thermal system that is calculated by multiplying the aperture area of the solar collector area of the system, expressed in square meters, by a conversion factor of 0.7.
(d)kWhth means kilowatthours thermal as measured by the number of kilowatts thermal generated, or displaced, in an hour.
(e)Low-income residential housing means either of the following:
(1)Residential housing financed with low-income housing tax credits, tax-exempt mortgage revenue bonds, general obligation bonds, or local, state, or federal loans or grants, and for which the rents of the occupants who are lower income households, as defined in Section 50079.5 of the Health and Safety Code, do not exceed those prescribed by deed restrictions or regulatory agreements pursuant to the terms of the financing or financial assistance.
(2)A residential complex in which at least 20 percent of the total units are sold or rented to lower income households, as defined in Section 50079.5 of the Health and Safety Code, and the housing units targeted for lower income households are already, at the time of the funding commitment pursuant to this article, subject to a deed restriction or affordability covenant with a public entity that ensures that the units will be available at an affordable housing cost meeting the requirements of Section 50052.5 of the Health and Safety Code, or at an affordable rent meeting the requirements of Section 50053 of the Health and Safety Code, for a period of not less than 30 years. Code.
(f)New Solar Homes Partnership means the 10-year program, administered by the Energy Commission, encouraging solar energy systems in new home construction.
(g)Solar heating collector means a device that is used to collect or capture heat from the sun and that is generally, but need not be, located on a roof.
(h)Solar thermal system means a solar energy device that has the primary purpose of reducing demand for natural gas or electricity through water heating, space heating or cooling, or other methods of capturing heat energy from the sun to reduce natural gas or electricity consumption in a home, business, or any building or facility receiving natural gas that is subject to the surcharge established pursuant to paragraph (2) of subdivision (b) of Section 2863, or exempt from the surcharge pursuant to paragraph (4) of subdivision (b) of Section 2863, and that meets or exceeds the eligibility criteria established pursuant to Section 2864. Solar thermal systems include multifamily residential, industrial, governmental, educational, and nonprofit solar pool heating systems, but do not include single-family residential solar pool heating systems.
SEC. 3.Section 2862 of the Public Utilities Code is amended and renumbered to read:2860.(a)The Legislature finds and declares all of the following:
(1)California is heavily dependent on natural gas.
(2)The storage and delivery of natural gas relies on aging infrastructure that is prone to leaks that can damage the environment and imperil public health.
(3)Natural gas is a fossil fuel and a major source of global warming pollution and the pollutants that cause air pollution, including smog.
(4)Californias growing population and economy will put a strain on energy supplies and threaten the ability of the state to meet its global warming goals unless specific steps are taken to reduce demand and generate energy cleanly and efficiently.
(5)Water heating for domestic and industrial use relies almost entirely on natural gas and accounts for a significant percentage of the states natural gas consumption.
(6)Solar thermal systems represent the major untapped natural gas saving potential in California.
(7)In addition to financial and energy savings, solar water heating systems can help protect against future gas and electricity shortages and reduce our dependence on foreign sources of energy.
(8)Solar thermal systems can also help preserve the environment and protect public health by reducing air pollution, including carbon dioxide, a leading global warming gas, and nitrogen oxide, a precursor to smog.
(9)Growing demand for these technologies will create jobs in California as well as promote greater energy independence, protect consumers from rising energy costs, and result in cleaner air.
(10)Installing solar thermal systems in disadvantaged communities can provide local economic benefits while advancing the states clean energy goals and policies to reduce the emissions of greenhouse gases.
(11)It is in the interest of the State of California to promote solar thermal systems and other technologies that directly reduce demand for natural gas in homes and businesses.
(b)It is the intent of the Legislature to build a mainstream market for solar thermal systems that directly reduces demand for natural gas in homes, businesses, schools, industrial and government buildings, and buildings occupied by nonprofit organizations.
(c)It is the intent of the Legislature that the solar thermal system incentives created by this article should lead to cost-effective investments by gas customers. Gas customers will recoup the cost of these investments through lower energy bills as a result of avoiding purchases of natural gas.
SEC. 4.Section 2863 of the Public Utilities Code is amended to read:2863.(a)By July 31, 2017, the commission shall do all of the following:
(1)Implement changes to the program as authorized pursuant to this section as it read on December 31, 2016, applicable to the service territories of a gas corporation to promote the installation of solar thermal systems in homes, businesses, and buildings or facilities of eligible customer classes receiving natural gas service throughout the state. Eligible customer classes shall include single-family and multifamily residential, commercial, industrial, governmental, nonprofit, and primary, secondary, and postsecondary educational customers. The commission shall implement program changes in phases, if necessary, to enable seamless continuation of the availability of rebates as of January 1, 2017.
(2)The program shall be administered by gas corporations or third-party administrators, as determined by the commission, and subject to the supervision of the commission.
(3)The commission shall coordinate the program with the Energy Commissions programs and initiatives, including, but not limited to, the New Solar Homes Partnership, to achieve the goal of building zero-energy homes.
(b)(1)The commission shall fund the program through the use of a surcharge applied to gas customers based upon the amount of natural gas consumed. The surcharge shall be in addition to any other charges for natural gas sold or transported for consumption in this state.
(2)Funding for the program established by this article shall not, for the collective service territories of all gas corporations, exceed two hundred fifty million dollars ($250,000,000) over the course of the period from January 1, 2017, to July 31, 2022, inclusive.
(3)Fifty percent of the total program budget shall be reserved for the installation of solar thermal systems in low-income residential housing or in buildings in disadvantaged communities. The commission may revise the percentage if the budget for other types of customers becomes depleted.
(4)Ten percent of the total program budget shall be reserved for the installation of solar thermal systems for industrial applications. The commisison commission may revise the percentage if the budget for other types of customers becomes depleted.
(5)The commission shall annually establish a surcharge rate for each class of gas customers. Any gas customer participating in the California Alternate Rates for Energy (CARE) or Family Electric Rate Assistance (FERA) programs shall be exempt from paying any surcharge imposed to fund the program designed and implemented pursuant to this article.
(6)Any surcharge imposed to fund the program designed and implemented pursuant to this article shall not be imposed upon the portion of any gas customers procurement of natural gas that is used or employed for a purpose that Section 896 excludes from being categorized as the consumption of natural gas.
(7)The gas corporation or other person or entity providing revenue cycle services, as defined in Section 328.1, shall be responsible for collecting the surcharge.
(c)Funds shall be allocated in the form of customer rebates to promote utilization of solar thermal systems.
(1)On and after January 1, 2017, the rebate amount shall be consistent with the amount the commission established for the calendar year 2016 until revised by the commission pursuant to paragraph (2).
(2)Beginning in 2017, and every two years thereafter, the commission shall consider revisions to the rebate amount, taking into account the cost of installing solar thermal systems and the price of natural gas to end-use customers.
(3)The commission shall ensure that a cap on the maximum rebate amount does not unreasonably impair the ability of industrial customers to participate in the program.
(d)In designing and implementing the program required by this article, no moneys shall be diverted from any existing programs for low-income ratepayers or cost-effective energy efficiency programs.
SEC. 5.Section 2864 of the Public Utilities Code is amended to read:2864.(a)The commission, in consultation with the Energy Commission and interested members of the public, shall establish eligibility criteria for solar thermal systems receiving gas customer funded incentives pursuant to this article. The criteria should specify and include all of the following:
(1)Design, installation, and energy output or displacement standards. To be eligible for rebate funding, a residential solar thermal system shall be certified by an accredited listing agency in accordance with standards adopted by the commission. Solar collectors used in systems for multifamily residential, commercial, government, nonprofit, educational, or industrial applications shall be certified by an accredited listing agency in accordance with standards adopted by the commission. Energy output of collectors and systems shall be determined in accordance with procedures set forth by the listing agency, and shall be based on testing results from accredited testing laboratories.
(2)A requirement that solar thermal system components are new and unused, and have not previously been placed in service in any other location or for any other application.
(3)A requirement that solar thermal collectors have a warranty of not less than 10 years to protect against defects and undue degradation.
(4)A requirement that solar thermal systems are in buildings or facilities connected to a natural gas utilitys distribution system within the state.
(5)(A)A requirement that solar thermal systems have meters or other kWhth measuring devices in place to monitor and measure the systems performance and the quantity of energy generated or displaced by the system. The cost of monitoring the system shall not exceed 2 percent of the system cost.
(B)The commission shall exempt from this requirement system types for which the cost of monitoring a system is likely to exceed 2 percent of the system cost. After a public stakeholder process, the commission may adjust this percentage to ensure reasonable balance between customer cost and value received, taking into account factors including, but not limited to, customer class, system type, system size, or changes in the market.
(6)A requirement that solar thermal systems are installed in conformity with the manufacturers specifications and all applicable codes and standards.
(7)A requirement that, when the property is not owner-occupied, the tenant shall not contract for the installation of a solar thermal system. The tenant may request that the owner participate in such a program.
(b)Gas customer funded incentives shall not be made for a solar thermal system that does not meet the eligibility criteria.
(c)The commission may adopt consensus solar standards applicable to products or systems as developed by accredited standards developers.
SEC. 6.Section 2865 of the Public Utilities Code is amended to read:2865.(a)The commission shall establish conditions on gas customer funded incentives pursuant to this article. The conditions shall require both of the following:
(1)Appropriate siting and high-quality installation of the solar thermal system based on installation guidelines that maximize the performance of the system and prevent qualified systems from being inefficiently or inappropriately installed. The conditions shall not impact housing designs or densities presently authorized by a city, county, or city and county. The goal of this paragraph is to achieve efficient installation of solar thermal systems and promote the greatest energy production or displacement per gas customer dollar.
(2)Appropriate energy efficiency improvements in the new or existing home or facility where the solar thermal system is installed.
(b)The commission shall set rating standards for equipment, components, and systems to ensure reasonable performance and shall develop procedures that provide for compliance with the minimum ratings.
SEC. 7.Section 2866 of the Public Utilities Code is amended to read:2866.(a)The commission may establish a grant program or a revolving loan or loan guarantee program for low-income residential housing consistent with the requirements of Chapter 5.3 (commencing with Section 25425) of Division 15 of the Public Resources Code. Notwithstanding Section 2867.4, all loans outstanding as of August 1, 2022, shall continue to be repaid in a manner that is consistent with the terms and conditions of the program adopted and implemented by the commission pursuant to this subdivision, until repaid in full.
(b)The commission may extend eligibility for funding pursuant to this section and paragraph (3) of subdivision (b) of Section 2863 to include residential housing occupied by ratepayers participating in a commission approved and supervised gas corporation Low-Income Energy Efficiency (LIEE) program and who either:
(1)Occupy a single-family home.
(2)Occupy at least 50 percent of all units in a multifamily dwelling structure.
(c)The commission shall ensure that lower income households, as defined in Section 50079.5 of the Health and Safety Code, and, if the commission expands the program pursuant to subdivision (b), ratepayers participating in a LIEE program, that receive gas service at residential housing with a solar thermal system receiving incentives pursuant to subdivision (a) benefit from the installation of the solar thermal systems through reduced or lowered energy costs.
(d)The commission shall do all of the following to implement the requirements of this section:
(1)Maximize incentives to properties that are committed to continuously serving the needs of lower income households, as defined in Section 50079.5 of the Health and Safety Code, and, if the commission expands the program pursuant to subdivision (b), ratepayers participating in a LIEE program.
(2)Establish conditions on the installation of solar thermal systems that ensure properties on which solar thermal systems are installed under subdivision (a) remain low-income residential properties for at least 10 years from the time of installation, including property ownership restrictions and income rental protections, and appropriate enforcement of these conditions.
SEC. 8.Section 2867 of the Public Utilities Code is amended to read:2867.(a)Consistent with subdivision (c) of Section 2863, the commission shall consider reductions over time in rebates provided through the program. The rebate shall be structured so as to drive down the cost of the solar thermal technologies, and be paid out on a performance-based incentive basis so that incentives are earned based on the actual energy savings, or on predicted energy savings as established by the commission.
(b)The commission shall consider federal tax credits and other incentives available for this technology when determining the appropriate rebate amount.
(c)The commission shall consider the impact of rebates for solar thermal systems pursuant to this article on existing incentive programs for energy efficiency technology.
(d)In coordination with the commission, the Energy Commission shall consider, when appropriate, coupling rebates for solar thermal systems with complementary energy efficiency technologies, including, but not limited to, efficient hot water heating tanks and tankless or on demand hot water systems that can be installed in addition to the solar thermal system.
SEC. 9.Section 2867.1 of the Public Utilities Code is repealed.SEC. 10.Section 2867.2 of the Public Utilities Code is repealed.SEC. 11.Section 2867.3 of the Public Utilities Code is amended to read:2867.3.The governing body of each publicly owned utility providing gas service to retail end-use gas customers shall, after a public proceeding, adopt, implement, and finance a solar thermal system incentive program that does all the following:
(a)Ensures that any solar thermal system receiving monetary incentives complies with eligibility criteria adopted by the governing body. The eligibility criteria shall include those elements contained in paragraphs (1) to (6), inclusive, of subdivision (a) of Section 2864.
(b)Includes minimum ratings and standards for equipment, components, and systems to ensure reasonable performance and compliance with the minimum ratings and standards.
(c)Includes an element that addresses the installation of solar thermal systems on low-income residential housing. If deemed appropriate in consultation with the California Tax Credit Allocation Committee, the governing board may establish a grant program or a revolving loan or loan guarantee program for low-income residential housing consistent with the requirements of Chapter 5.3 (commencing with Section 25425) of Division 15 of the Public Resources Code.
SEC. 12.Section 2867.4 of the Public Utilities Code is repealed.SEC. 13.Section 2867.4 is added to the Public Utilities Code, to read:2867.4.This article shall become inoperative on August 1, 2022, and, as of January 1, 2023, is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2023, deletes or extends the dates on which it becomes inoperative and is repealed.
SEC. 14.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because a local agency or school district has the authority to levy service charges, fees, or assessments sufficient to pay for the program or level of service mandated by this act or because costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.
As used in this article, the following terms have the following meanings:
(a)Disadvantaged community means a community identified by the California Environmental Protection Agency pursuant to Section 39711 of the Health and Safety Code.
(b)Gas customer includes both core and noncore customers, as those terms are used in Chapter 2.2 (commencing with Section 328) of Part 1, that receive retail end-use gas service within the service territory of a gas corporation.
(c)kWth or kilowatts thermal means the unit of measure of the equivalent thermal capacity of a solar thermal system that is calculated by multiplying the aperture area of the solar collector area of the system, expressed in square meters, by a conversion factor of 0.7.
(d)kWhth means kilowatthours thermal as measured by the number of kilowatts thermal generated, or displaced, in an hour.
(e)Low-income residential housing means either of the following:
(1)Residential housing financed with low-income housing tax credits, tax-exempt mortgage revenue bonds, general obligation bonds, or local, state, or federal loans or grants, and for which the rents of the occupants who are lower income households, as defined in Section 50079.5 of the Health and Safety Code, do not exceed those prescribed by deed restrictions or regulatory agreements pursuant to the terms of the financing or financial assistance.
(2)A residential complex in which at least 20 percent of the total units are sold or rented to lower income households, as defined in Section 50079.5 of the Health and Safety Code, and the housing units targeted for lower income households are subject to a deed restriction or affordability covenant with a public entity that ensures that the units will be available at an affordable housing cost meeting the requirements of Section 50052.5 of the Health and Safety Code, or at an affordable rent meeting the requirements of Section 50053 of the Health and Safety Code, for a period of not less than 30 years.
(f)New Solar Homes Partnership means the 10-year program, administered by the Energy Commission, encouraging solar energy systems in new home construction.
(g)Solar heating collector means a device that is used to collect or capture heat from the sun and that is generally, but need not be, located on a roof.
(h)Solar thermal system means a solar energy device that has the primary purpose of reducing demand for natural gas or electricity through water heating, space heating or cooling, or other methods of capturing heat energy from the sun to reduce natural gas or electricity consumption in a home, business, or any building or facility receiving natural gas that is subject to the surcharge established pursuant to paragraph (2) of subdivision (b) of Section 2863, or exempt from the surcharge pursuant to paragraph (4) of subdivision (b) of Section 2863, and that meets or exceeds the eligibility criteria established pursuant to Section 2864. Solar thermal systems include multifamily residential, industrial, governmental, educational, and nonprofit solar pool heating systems, but do not include single-family residential solar pool heating systems.
SEC. 3.Section 2862 of the Public Utilities Code is amended and renumbered to read:2860.(a)The Legislature finds and declares all of the following:
(1)California is heavily dependent on natural gas.
(2)The storage and delivery of natural gas relies on aging infrastructure that is prone to leaks that can damage the environment and imperil public health.
(3)Natural gas is a fossil fuel and a major source of global warming pollution and the pollutants that cause air pollution, including smog.
(4)Californias growing population and economy will put a strain on energy supplies and threaten the ability of the state to meet its global warming goals unless specific steps are taken to reduce demand and generate energy cleanly and efficiently.
(5)Water heating for domestic and industrial use relies almost entirely on natural gas and accounts for a significant percentage of the states natural gas consumption.
(6)Solar thermal systems represent the major untapped natural gas saving potential in California.
(7)In addition to financial and energy savings, solar water heating systems can help protect against future gas and electricity shortages and reduce our dependence on foreign sources of energy.
(8)Solar thermal systems can also help preserve the environment and protect public health by reducing air pollution, including carbon dioxide, a leading global warming gas, and nitrogen oxide, a precursor to smog.
(9)Growing demand for these technologies will create jobs in California as well as promote greater energy independence, protect consumers from rising energy costs, and result in cleaner air.
(10)Installing solar thermal systems in disadvantaged communities can provide local economic benefits while advancing the states clean energy goals and policies to reduce the emissions of greenhouse gases.
(11)It is in the interest of the State of California to promote solar thermal systems and other technologies that directly reduce demand for natural gas in homes and businesses.
(b)It is the intent of the Legislature to build a mainstream market for solar thermal systems that directly reduces demand for natural gas in homes, businesses, schools, industrial and government buildings, and buildings occupied by nonprofit organizations.
(c)It is the intent of the Legislature that the solar thermal system incentives created by this article should lead to cost-effective investments by gas customers. Gas customers will recoup the cost of these investments through lower energy bills as a result of avoiding purchases of natural gas.
SEC. 4.Section 2863 of the Public Utilities Code is amended to read:2863.(a)By July 31, 2017, the commission shall do all of the following:
(1)Implement changes to the program as authorized pursuant to this section as it read on December 31, 2016, applicable to the service territories of a gas corporation to promote the installation of solar thermal systems in homes, businesses, and buildings or facilities of eligible customer classes receiving natural gas service throughout the state. Eligible customer classes shall include single-family and multifamily residential, commercial, industrial, governmental, nonprofit, and primary, secondary, and postsecondary educational customers. The commission shall implement program changes in phases, if necessary, to enable seamless continuation of the availability of rebates as of January 1, 2017.
(2)The program shall be administered by gas corporations or third-party administrators, as determined by the commission, and subject to the supervision of the commission.
(3)The commission shall coordinate the program with the Energy Commissions programs and initiatives, including, but not limited to, the New Solar Homes Partnership, to achieve the goal of building zero-energy homes.
(b)(1)The commission shall fund the program through the use of a surcharge applied to gas customers based upon the amount of natural gas consumed. The surcharge shall be in addition to any other charges for natural gas sold or transported for consumption in this state.
(2)Funding for the program established by this article shall not, for the collective service territories of all gas corporations, exceed one billion dollars ($1,000,000,000) two hundred fifty million dollars ($250,000,000) over the course of the period from January 1, 2017, to July 31, 2027, 2022, inclusive.
(3)Fifty percent of the total program budget shall be reserved for the installation of solar thermal systems in low-income residential housing or in buildings in disadvantaged communities. The commission may revise the percentage if the budget for other types of customers becomes depleted.
(4)Ten percent of the total program budget shall be reserved for the installation of solar thermal systems for industrial applications. The commisison may revise the percentage if the budget for other types of customers becomes depleted.
(5)The commission shall annually establish a surcharge rate for each class of gas customers. Any gas customer participating in the California Alternate Rates for Energy (CARE) or Family Electric Rate Assistance (FERA) programs shall be exempt from paying any surcharge imposed to fund the program designed and implemented pursuant to this article.
(6)Any surcharge imposed to fund the program designed and implemented pursuant to this article shall not be imposed upon the portion of any gas customers procurement of natural gas that is used or employed for a purpose that Section 896 excludes from being categorized as the consumption of natural gas.
(7)The gas corporation or other person or entity providing revenue cycle services, as defined in Section 328.1, shall be responsible for collecting the surcharge.
(c)Funds shall be allocated in the form of customer rebates to promote utilization of solar thermal systems.
(1)On and after January 1, 2017, the rebate amount shall be consistent with the amount the commission established for the calendar year 2016 until revised by the commission pursuant to paragraph (2).
(2)Beginning in 2017, and every two years thereafter, the commission shall consider revisions to the rebate amount, taking into account the cost of installing solar thermal systems and the price of natural gas to end-use customers.
(3)The commission shall ensure that a cap on the maximum rebate amount does not unreasonably impair the ability of industrial customers to participate in the program.
(d)In designing and implementing the program required by this article, no moneys shall be diverted from any existing programs for low-income ratepayers or cost-effective energy efficiency programs.
SEC. 5.Section 2864 of the Public Utilities Code is amended to read:2864.(a)The commission, in consultation with the Energy Commission and interested members of the public, shall establish eligibility criteria for solar thermal systems receiving gas customer funded incentives pursuant to this article. The criteria should specify and include all of the following:
(1)Design, installation, and energy output or displacement standards. To be eligible for rebate funding, a residential solar thermal system shall be certified by an accredited listing agency in accordance with standards adopted by the commission. Solar collectors used in systems for multifamily residential, commercial, government, nonprofit, educational, or industrial applications shall be certified by an accredited listing agency in accordance with standards adopted by the commission. Energy output of collectors and systems shall be determined in accordance with procedures set forth by the listing agency, and shall be based on testing results from accredited testing laboratories.
(2)A requirement that solar thermal system components are new and unused, and have not previously been placed in service in any other location or for any other application.
(3)A requirement that solar thermal collectors have a warranty of not less than 10 years to protect against defects and undue degradation.
(4)A requirement that solar thermal systems are in buildings or facilities connected to a natural gas utilitys distribution system within the state.
(5)A requirement that solar thermal systems have meters or other kWhth measuring devices in place to monitor and measure the systems performance and the quantity of energy generated or displaced by the system. The cost of monitoring the system shall not exceed 2 percent of the system cost.
(6)A requirement that solar thermal systems are installed in conformity with the manufacturers specifications and all applicable codes and standards.
(b)Gas customer funded incentives shall not be made for a solar thermal system that does not meet the eligibility criteria.
(c)The commission may adopt consensus solar standards applicable to products or systems as developed by accredited standards developers.
SEC. 6.Section 2865 of the Public Utilities Code is amended to read:2865.(a)The commission shall establish conditions on gas customer funded incentives pursuant to this article. The conditions shall require both of the following:
(1)Appropriate siting and high-quality installation of the solar thermal system based on installation guidelines that maximize the performance of the system and prevent qualified systems from being inefficiently or inappropriately installed. The conditions shall not impact housing designs or densities presently authorized by a city, county, or city and county. The goal of this paragraph is to achieve efficient installation of solar thermal systems and promote the greatest energy production or displacement per gas customer dollar.
(2)Appropriate energy efficiency improvements in the new or existing home or facility where the solar thermal system is installed.
(b)The commission shall set rating standards for equipment, components, and systems to ensure reasonable performance and shall develop procedures that provide for compliance with the minimum ratings.
SEC. 7.Section 2866 of the Public Utilities Code is amended to read:2866.(a)The commission may establish a grant program or a revolving loan or loan guarantee program for low-income residential housing consistent with the requirements of Chapter 5.3 (commencing with Section 25425) of Division 15 of the Public Resources Code. Notwithstanding Section 2867.4, all loans outstanding as of August 1, 2027, 2022, shall continue to be repaid in a manner that is consistent with the terms and conditions of the program adopted and implemented by the commission pursuant to this subdivision, until repaid in full.
(b)The commission may extend eligibility for funding pursuant to this section to include residential housing occupied by ratepayers participating in a commission approved and supervised gas corporation Low-Income Energy Efficiency (LIEE) program and who either:
(1)Occupy a single-family home.
(2)Occupy at least 50 percent of all units in a multifamily dwelling structure.
(c)The commission shall ensure that lower income households, as defined in Section 50079.5 of the Health and Safety Code, and, if the commission expands the program pursuant to subdivision (b), ratepayers participating in a LIEE program, that receive gas service at residential housing with a solar thermal system receiving incentives pursuant to subdivision (a) benefit from the installation of the solar thermal systems through reduced or lowered energy costs.
(d)The commission shall do all of the following to implement the requirements of this section:
(1)Maximize incentives to properties that are committed to continuously serving the needs of lower income households, as defined in Section 50079.5 of the Health and Safety Code, and, if the commission expands the program pursuant to subdivision (b), ratepayers participating in a LIEE program.
(2)Establish conditions on the installation of solar thermal systems that ensure properties on which solar thermal systems are installed under subdivision (a) remain low-income residential properties for at least 10 years from the time of installation, including property ownership restrictions and income rental protections, and appropriate enforcement of these conditions.
SEC. 8.Section 2867 of the Public Utilities Code is amended to read:2867.(a)Consistent with subdivision (c) of Section 2863, the commission shall consider reductions over time in rebates provided through the program. The rebate shall be structured so as to drive down the cost of the solar thermal technologies, and be paid out on a performance-based incentive basis so that incentives are earned based on the actual energy savings, or on predicted energy savings as established by the commission.
(b)The commission shall consider federal tax credits and other incentives available for this technology when determining the appropriate rebate amount.
(c)The commission shall consider the impact of rebates for solar thermal systems pursuant to this article on existing incentive programs for energy efficiency technology.
(d)In coordination with the commission, the Energy Commission shall consider, when appropriate, coupling rebates for solar thermal systems with complementary energy efficiency technologies, including, but not limited to, efficient hot water heating tanks and tankless or on demand hot water systems that can be installed in addition to the solar thermal system.
SEC. 9.Section 2867.1 of the Public Utilities Code is repealed.SEC. 10.Section 2867.2 of the Public Utilities Code is repealed.SEC. 11.Section 2867.3 of the Public Utilities Code is amended to read:2867.3.The governing body of each publicly owned utility providing gas service to retail end-use gas customers shall, after a public proceeding, adopt, implement, and finance a solar thermal system incentive program that does all the following:
(a)Ensures that any solar thermal system receiving monetary incentives complies with eligibility criteria adopted by the governing body. The eligibility criteria shall include those elements contained in paragraphs (1) to (6), inclusive, of subdivision (a) of Section 2864.
(b)Includes minimum ratings and standards for equipment, components, and systems to ensure reasonable performance and compliance with the minimum ratings and standards.
(c)Includes an element that addresses the installation of solar thermal systems on low-income residential housing. If deemed appropriate in consultation with the California Tax Credit Allocation Committee, the governing board may establish a grant program or a revolving loan or loan guarantee program for low-income residential housing consistent with the requirements of Chapter 5.3 (commencing with Section 25425) of Division 15 of the Public Resources Code.
SEC. 12.Section 2867.4 of the Public Utilities Code is repealed.SEC. 13.Section 2867.4 is added to the Public Utilities Code, to read:2867.4.This article shall become inoperative on August 1, 2027, 2022, and, as of January 1, 2028, 2023, is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2028, 2023, deletes or extends the dates on which it becomes inoperative and is repealed.
SEC. 14.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because a local agency or school district has the authority to levy service charges, fees, or assessments sufficient to pay for the program or level of service mandated by this act or because costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.
As used in this article, the following terms have the following meanings:
(a)Disadvantaged community means a community identified by the California Environmental Protection Agency pursuant to Section 39711 of the Health and Safety Code.
(b)Gas customer includes both core and noncore customers, as those terms are used in Chapter 2.2 (commencing with Section 328) of Part 1, that receive retail end-use gas service within the service territory of a gas corporation.
(c)kWth or kilowatts thermal means the unit of measure of the equivalent thermal capacity of a solar water heating thermal system that is calculated by multiplying the aperture area of the solar collector area of the system, expressed in square meters, by a conversion factor of 0.7.
(d)kWhth means kilowatthours thermal as measured by the number of kilowatts thermal generated, or displaced, in an hour.
(e)Low-income residential housing means either of the following:
(1)Residential housing financed with low-income housing tax credits, tax-exempt mortgage revenue bonds, general obligation bonds, or local, state, or federal loans or grants, and for which the rents of the occupants who are lower income households, as defined in Section 50079.5 of the Health and Safety Code, do not exceed those prescribed by deed restrictions or regulatory agreements pursuant to the terms of the financing or financial assistance.
(2)A residential complex in which at least 20 percent of the total units are sold or rented to lower income households, as defined in Section 50079.5 of the Health and Safety Code, and the housing units targeted for lower income households are subject to a deed restriction or affordability covenant with a public entity that ensures that the units will be available at an affordable housing cost meeting the requirements of Section 50052.5 of the Health and Safety Code, or at an affordable rent meeting the requirements of Section 50053 of the Health and Safety Code, for a period of not less than 30 years.
(f)New Solar Homes Partnership means the 10-year program, administered by the Energy Commission, encouraging solar energy systems in new home construction.
(g)Solar heating collector means a device that is used to collect or capture heat from the sun and that is generally, but need not be, located on a roof.
(h)Solar water heating thermal system means a solar energy device that has the primary purpose of reducing demand for natural gas or electricity through water heating, space heating, heating or cooling, or other methods of capturing heat energy from the sun to reduce natural gas or electricity consumption in a home, business, or any building or facility receiving natural gas that is subject to the surcharge established pursuant to paragraph (2) of subdivision (b) of Section 2863, or exempt from the surcharge pursuant to paragraph (4) of subdivision (c) (b) of Section 2863, and that meets or exceeds the eligibility criteria established pursuant to Section 2864. Solar water heating thermal systems include multifamily residential, industrial, governmental, educational, and nonprofit solar pool heating systems, but do not include single-family residential solar pool heating systems.
SEC. 3.Section 2862 of the Public Utilities Code is amended and renumbered to read:2860.(a)Legislature finds and declares all of the following:
(1)California is heavily dependent on natural gas.
(2)The storage and delivery of natural gas relies on aging infrastructure that is prone to leaks that can damage the environment and imperil public health.
(3)Natural gas is a fossil fuel and a major source of global warming pollution and the pollutants that cause air pollution, including smog.
(4)Californias growing population and economy will put a strain on energy supplies and threaten the ability of the state to meet its global warming goals unless specific steps are taken to reduce demand and generate energy cleanly and efficiently.
(5)Water heating for domestic and industrial use relies almost entirely on natural gas and accounts for a significant percentage of the states natural gas consumption.
(6)Solar water heating thermal systems represent the major untapped natural gas saving potential in California.
(7)In addition to financial and energy savings, solar water heating systems can help protect against future gas and electricity shortages and reduce our dependence on foreign sources of energy.
(8)Solar water heating thermal systems can also help preserve the environment and protect public health by reducing air pollution, including carbon dioxide, a leading global warming gas, and nitrogen oxide, a precursor to smog.
(9)Growing demand for these technologies will create jobs in California as well as promote greater energy independence, protect consumers from rising energy costs, and result in cleaner air.
(10)Installing solar water heating thermal systems in disadvantaged communities can provide local economic benefits while advancing the states clean energy goals and policies to reduce the emissions of greenhouse gases.
(11)It is in the interest of the State of California to promote solar water heating thermal systems and other technologies that directly reduce demand for natural gas in homes and businesses.
(b)It is the intent of the Legislature to build a mainstream market for solar water heating thermal systems that directly reduces demand for natural gas in homes, businesses, schools, and nonprofit industrial and government buildings. buildings, and buildings occupied by nonprofit organizations.
(c)It is the intent of the Legislature that the solar water heating thermal system incentives created by this article should be a lead to cost-effective investment investments by gas customers. Gas customers will recoup the cost of their investment these investments through lower energy bills as a result of avoiding purchases of natural gas.
SEC. 4.Section 2863 of the Public Utilities Code is amended to read:2863.(a)By July 31, 2017, the commission shall do all of the following:
(1)Implement changes to the program as authorized pursuant to this section as it read on December 31, 2016, applicable to the service territories of a gas corporation to promote the installation of solar water heating thermal systems in homes, businesses, and buildings or facilities of eligible customer classes receiving natural gas service throughout the state. Eligible customer classes shall include single-family and multifamily residential, commercial, industrial, governmental, nonprofit, and primary, secondary, and postsecondary educational customers. The commission shall implement program changes in phases, if necessary, to enable seamless continuation of the availability of rebates as of January 1, 2017.
(2)The program shall be administered by gas corporations or third-party administrators, as determined by the commission, and subject to the supervision of the commission.
(3)The commission shall coordinate the program with the Energy Commissions programs and initiatives, including, but not limited to, the New Solar Homes Partnership, to achieve the goal of building zero-energy homes.
(b)(1)The commission shall fund the program through the use of a surcharge applied to gas customers based upon the amount of natural gas consumed. The surcharge shall be in addition to any other charges for natural gas sold or transported for consumption in this state.
(2)Funding for the program established by this article shall not, for the collective service territories of all gas corporations, exceed one billion dollars ($1,000,000,000) over the course of the period from January 1, 2017, to July 31, 2027, inclusive.
(3)Fifty percent of the total program budget shall be reserved for the installation of solar water heating thermal systems in low-income residential housing or in buildings in disadvantaged communities. The commission may revise the percentage if the budget for other types of customers becomes depleted.
(4)Ten percent of the total program budget shall be reserved for the installation of solar thermal systems for industrial applications. The commisison may revise the percentage if the budget for other types of customers becomes depleted.
(4)
(5)The commission shall annually establish a surcharge rate for each class of gas customers. Any gas customer participating in the California Alternate Rates for Energy (CARE) or Family Electric Rate Assistance (FERA) programs shall be exempt from paying any surcharge imposed to fund the program designed and implemented pursuant to this article.
(5)
(6)Any surcharge imposed to fund the program designed and implemented pursuant to this article shall not be imposed upon the portion of any gas customers procurement of natural gas that is used or employed for a purpose that Section 896 excludes from being categorized as the consumption of natural gas.
(6)
(7)The gas corporation or other person or entity providing revenue cycle services, as defined in Section 328.1, shall be responsible for collecting the surcharge.
(c)Funds shall be allocated in the form of customer rebates to promote utilization of solar water heating thermal systems.
(1)On and after January 1, 2017, the rebate amount shall be consistent with the amount the commission established for the calendar year 2016 until revised by the commission pursuant to paragraph (2).
(2)Beginning in 2017, and every two years thereafter, the commission shall consider revisions to the rebate amount, taking into account the cost of installing solar water heating thermal systems and the price of natural gas to end-use customers.
(3)The commission shall ensure that a cap on the maximum rebate amount does not unreasonably impair the ability of industrial customers to participate in the program.
(d)In designing and implementing the program required by this article, no moneys shall be diverted from any existing programs for low-income ratepayers or cost-effective energy efficiency programs.
SEC. 5.Section 2864 of the Public Utilities Code is amended to read:2864.(a)The commission, in consultation with the Energy Commission and interested members of the public, shall establish eligibility criteria for solar water heating thermal systems receiving gas customer funded incentives pursuant to this article. The criteria should specify and include all of the following:
(1)Design, installation, and energy output or displacement standards. To be eligible for rebate funding, a residential solar water heating thermal system shall be certified by an accredited listing agency in accordance with standards adopted by the commission. Solar collectors used in systems for multifamily residential, commercial, government, nonprofit, educational, or industrial water heating applications shall be certified by an accredited listing agency in accordance with standards adopted by the commission. Energy output of collectors and systems shall be determined in accordance with procedures set forth by the listing agency, and shall be based on testing results from accredited testing laboratories.
(2)A requirement that solar water heating thermal system components are new and unused, and have not previously been placed in service in any other location or for any other application.
(3)A requirement that solar water heating thermal collectors have a warranty of not less than 10 years to protect against defects and undue degradation.
(4)A requirement that solar water heating thermal systems are in buildings or facilities connected to a natural gas utilitys distribution system within the state.
(5)A requirement that solar water heating thermal systems have meters or other kWhth measuring devices in place to monitor and measure the systems performance and the quantity of energy generated or displaced by the system. The cost of monitoring the system shall not exceed 2 percent of the system cost.
(6)A requirement that solar water heating thermal systems are installed in conformity with the manufacturers specifications and all applicable codes and standards.
(b)Gas customer funded incentives shall not be made for a solar water heating thermal system that does not meet the eligibility criteria.
(c)The commission may adopt consensus solar standards applicable to products or systems as developed by accredited standards developers.
SEC. 6.Section 2865 of the Public Utilities Code is amended to read:2865.(a)The commission shall establish conditions on gas customer funded incentives pursuant to this article. The conditions shall require both of the following:
(1)Appropriate siting and high-quality installation of the solar water heating thermal system based on installation guidelines that maximize the performance of the system and prevent qualified systems from being inefficiently or inappropriately installed. The conditions shall not impact housing designs or densities presently authorized by a city, county, or city and county. The goal of this paragraph is to achieve efficient installation of solar water heating thermal systems and promote the greatest energy production or displacement per gas customer dollar.
(2)Appropriate energy efficiency improvements in the new or existing home or facility where the solar water heating thermal system is installed.
(b)The commission shall set rating standards for equipment, components, and systems to ensure reasonable performance and shall develop procedures that provide for compliance with the minimum ratings.
SEC. 7.Section 2866 of the Public Utilities Code is amended to read:2866.(a)The commission may establish a grant program or a revolving loan or loan guarantee program for low-income residential housing consistent with the requirements of Chapter 5.3 (commencing with Section 25425) of Division 15 of the Public Resources Code. Notwithstanding Section 2867.4, all loans outstanding as of August 1, 2027, shall continue to be repaid in a manner that is consistent with the terms and conditions of the program adopted and implemented by the commission pursuant to this subdivision, until repaid in full.
(b)The commission may extend eligibility for funding pursuant to this section to include residential housing occupied by ratepayers participating in a commission approved and supervised gas corporation Low-Income Energy Efficiency (LIEE) program and who either:
(1)Occupy a single-family home.
(2)Occupy at least 50 percent of all units in a multifamily dwelling structure.
(c)The commission shall ensure that lower income households, as defined in Section 50079.5 of the Health and Safety Code, and, if the commission expands the program pursuant to subdivision (b), ratepayers participating in a LIEE program, that receive gas service at residential housing with a solar water heating thermal system receiving incentives pursuant to subdivision (a), (a) benefit from the installation of the solar water heating thermal systems through reduced or lowered energy costs.
(d)The commission shall do all of the following to implement the requirements of this section:
(1)Maximize incentives to properties that are committed to continuously serving the needs of lower income households, as defined in Section 50079.5 of the Health and Safety Code, and, if the commission expands the program pursuant to subdivision (b), ratepayers participating in a LIEE program.
(2)Establish conditions on the installation of solar water heating thermal systems that ensure properties on which solar water heating thermal systems are installed under subdivision (a) remain low-income residential properties for at least 10 years from the time of installation, including property ownership restrictions and income rental protections, and appropriate enforcement of these conditions.
SEC. 8.Section 2867 of the Public Utilities Code is amended to read:2867.(a)Consistent with subdivision (c) of Section 2863, the commission shall consider reductions over time in rebates provided through the program. The rebate shall be structured so as to drive down the cost of the solar water heating thermal technologies, and be paid out on a performance-based incentive basis so that incentives are earned based on the actual energy savings, or on predicted energy savings as established by the commission.
(b)The commission shall consider federal tax credits and other incentives available for this technology when determining the appropriate rebate amount.
(c)The commission shall consider the impact of rebates for solar water heating thermal systems pursuant to this article on existing incentive programs for energy efficiency technology.
(d)In coordination with the commission, the Energy Commission shall consider, when appropriate, coupling rebates for solar water heating thermal systems with complementary energy efficiency technologies, including, but not limited to, efficient hot water heating tanks and tankless or on demand hot water systems that can be installed in addition to the solar water heating thermal system.
SEC. 9.Section 2867.1 of the Public Utilities Code is repealed.SEC. 10.Section 2867.2 of the Public Utilities Code is repealed.SEC. 11.Section 2867.3 of the Public Utilities Code is amended to read:2867.3.The governing body of each publicly owned utility providing gas service to retail end-use gas customers shall, after a public proceeding, adopt, implement, and finance a solar water heating thermal system incentive program that does all the following:
(a)Ensures that any solar water heating thermal system receiving monetary incentives complies with eligibility criteria adopted by the governing body. The eligibility criteria shall include those elements contained in paragraphs (1) to (6), inclusive, of subdivision (a) of Section 2864.
(b)Includes minimum ratings and standards for equipment, components, and systems to ensure reasonable performance and compliance with the minimum ratings and standards.
(c)Includes an element that addresses the installation of solar water heating thermal systems on low-income residential housing. If deemed appropriate in consultation with the California Tax Credit Allocation Committee, the governing board may establish a grant program or a revolving loan or loan guarantee program for low-income residential housing consistent with the requirements of Chapter 5.3 (commencing with Section 25425) of Division 15 of the Public Resources Code.
SEC. 12.Section 2867.4 of the Public Utilities Code is repealed.SEC. 13.Section 2867.4 is added to the Public Utilities Code, to read:2867.4.This article shall become inoperative on August 1, 2027, and, as of January 1, 2028, is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2028, deletes or extends the dates on which it becomes inoperative and is repealed.
SEC. 14.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because a local agency or school district has the authority to levy service charges, fees, or assessments sufficient to pay for the program or level of service mandated by this act or because costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.
This article shall be known, and may be cited, as the Solar Water Heating and Efficiency Act of 2007.
SEC. 2.Section 2861 of the Public Utilities Code is amended to read:2861.As used in this article, the following terms have the following meanings:
(a)Disadvantaged community means a community identified by the California Environmental Protection Agency pursuant to Section 39711 of the Health and Safety Code.
(a)
(b)Gas customer includes both core and noncore customers, as those terms are used in Chapter 2.2 (commencing with Section 328) of Part 1, that receive retail end-use gas service within the service territory of a gas corporation.
(b)
(c)kWth or kilowatts thermal means the kilowatt unit of measure of the equivalent thermal capacity of a solar water heating system, measured consistent with the standard established by the SRCC. system that is calculated by multiplying the aperture area of the solar collector area of the system, expressed in square meters, by a conversion factor of 0.7.
(c)
(d)kWhth means kilowatthours thermal as measured by the number of kilowatts thermal generated, or displaced, in an hour.
(d)
(e)Low-income residential housing means either of the following:
(1)Residential housing financed with low-income housing tax credits, tax-exempt mortgage revenue bonds, general obligation bonds, or local, state, or federal loans or grants, and for which the rents of the occupants who are lower income households, as defined in Section 50079.5 of the Health and Safety Code, do not exceed those prescribed by deed restrictions or regulatory agreements pursuant to the terms of the financing or financial assistance.
(2)A residential complex in which at least 20 percent of the total units are sold or rented to lower income households, as defined in Section 50079.5 of the Health and Safety Code, and the housing units targeted for lower income households are subject to a deed restriction or affordability covenant with a public entity that ensures that the units will be available at an affordable housing cost meeting the requirements of Section 50052.5 of the Health and Safety Code, or at an affordable rent meeting the requirements of Section 50053 of the Health and Safety Code, for a period of not less than 30 years.
(e)
(f)New Solar Homes Partnership means the 10-year program, administered by the Energy Commission, encouraging solar energy systems in new home construction.
(f)
(g)Solar heating collector means a device that is used to collect or capture heat from the sun and that is generally, but need not be, located on a roof.
(g)
(h)Solar water heating system means a solar energy device that has the primary purpose of reducing demand for natural gas through water heating, space heating, or other methods of capturing energy from the sun to reduce natural gas consumption in a home, business, or any building or facility receiving natural gas that is subject to the surcharge established pursuant to subdivision (b) of Section 2863, or exempt from the surcharge pursuant to subdivision (c) of Section 2863, and that meets or exceeds the eligibility criteria established pursuant to Section 2864. Solar water heating systems include multifamily residential, governmental, educational, and nonprofit solar pool heating systems, but do not include single-family residential solar pool heating systems.
(h)SRCC means the Solar Rating and Certification Corporation.
SEC. 3.Section 2862 of the Public Utilities Code is amended and renumbered to read:2862.The
2860.(a)Legislature finds and declares all of the following:
(a)
(1)California is heavily dependent on natural gas, importing more than 80 percent of the natural gas it consumes. gas.
(b)Rising worldwide demand for natural gas and a shrinking supply create rising and unstable prices that can harm California consumers and the economy.
(2)The storage and delivery of natural gas relies on aging infrastructure that is prone to leaks that can damage the environment and imperil public health.
(c)
(3)Natural gas is a fossil fuel and a major source of global warming pollution and the pollutants that cause air pollution, including smog.
(d)
(4)Californias growing population and economy will put a strain on energy supplies and threaten the ability of the state to meet its global warming goals unless specific steps are taken to reduce demand and generate energy cleanly and efficiently.
(e)
(5)Water heating for domestic and industrial use relies almost entirely on natural gas and accounts for a significant percentage of the states natural gas consumption.
(f)
(6)Solar water heating systems represent the largest major untapped natural gas saving potential remaining in California.
(g)
(7)In addition to financial and energy savings, solar water heating systems can help protect against future gas and electricity shortages and reduce our dependence on foreign sources of energy.
(h)
(8)Solar water heating systems can also help preserve the environment and protect public health by reducing air pollution, including carbon dioxide, a leading global warming gas, and nitrogen oxide, a precursor to smog.
(i)
(9)Growing demand for these technologies will create jobs in California as well as promote greater energy independence, protect consumers from rising energy costs, and result in cleaner air.
(10)Installing solar water heating systems in disadvantaged communities can provide local economic benefits while advancing the states clean energy goals and policies to reduce the emissions of greenhouse gases.
(j)
(11)It is in the interest of the State of California to promote solar water heating systems and other technologies that directly reduce demand for natural gas in homes and businesses.
(k)
(b)It is the intent of the Legislature to build a mainstream market for solar water heating systems that directly reduces demand for natural gas in homes, businesses, schools, nonprofit, and nonprofit and government buildings. Toward that end, it is the goal of this article to install at least 200,000 solar water heating systems on homes, businesses, and other buildings or facilities of eligible customer classes throughout the state by 2017, thereby lowering prices and creating a self-sufficient market that will sustain itself beyond the life of this program.
(l)
(c)It is the intent of the Legislature that the solar water heating system incentives created by this article should be a cost-effective investment by gas customers. Gas customers will recoup the cost of their investment through lower prices energy bills as a result of avoiding purchases of natural gas.
(m)It is the intent of the Legislature that this article will encourage the cost-effective deployment of solar heating systems in both residential and commercial markets and in each end-use application sector in a balanced manner. It is the intent of the Legislature that the commission monitor and adjust incentives created by this article so that they are cost-effective investments sufficient to significantly increase markets and promote market transformation. It is the intent of the Legislature that the commission ensure that increased, uniform growth in each market sector is achieved through program incentives or structure adjustments that prevent overutilization of program resources by any single sector.
SEC. 4.Section 2863 of the Public Utilities Code is amended to read:2863.(a)If, after a public hearing, the commission determines that a solar water heating program is cost effective for ratepayers and in the public interest, the By July 31, 2017, the commission shall do all of the following:
(1)Design and implement a Implement changes to the program as authorized pursuant to this section on December 31, 2016, applicable to the service territories of a gas corporation, to achieve the goal of the Legislature to promote the installation of 200,000 corporation to promote the installation of solar water heating systems in homes, businesses, and buildings or facilities of eligible customer classes receiving natural gas service throughout the state by 2017. state. Eligible customer classes shall include single-family and multifamily residential, commercial, industrial, governmental, nonprofit, and primary, secondary, and postsecondary educational customers. The commission shall implement program changes in phases, if necessary, to enable seamless continuation of the availability of rebates as of January 1, 2017.
(2)The program shall be administered by gas corporations or third-party administrators, as determined by the commission, and subject to the supervision of the commission.
(3)The commission shall coordinate the program with the Energy Commissions programs and initiatives, including, but not limited to, the New Solar Homes Partnership Partnership, to achieve the goal of building zero-energy homes.
(4)The commission shall determine an appropriate division of funds between solar water heating systems that are and are not solar pool heating systems.
(b)(1)The commission shall fund the program through the use of a surcharge applied to gas customers based upon the amount of natural gas consumed. The surcharge shall be in addition to any other charges for natural gas sold or transported for consumption in this state.
(2)The commission shall impose the surcharge at a level that is necessary to meet the goal of installing 200,000 solar water heating systems, or the equivalent output of 200,000 solar water heating systems, on homes, businesses, and buildings or facilities of eligible customer classes receiving natural gas service in California by 2017. Funding for the program established by this article shall not, for the collective service territories of all gas corporations, exceed two hundred fifty million dollars ($250,000,000) one billion dollars ($1,000,000,000) over the course of the 10-year program. period from January 1, 2017, to July 31, 2027, inclusive.
(3)Fifty percent of the total program budget shall be reserved for the installation of solar water heating systems in low-income residential housing or in buildings in disadvantaged communities. The commission may revise the percentage if the budget for other types of customers becomes depleted.
(3)
(4)The commission shall annually establish a surcharge rate for each class of gas customers. Any gas customer participating in the California Alternate Rates for Energy (CARE) or Family Electric Rate Assistance (FERA) programs shall be exempt from paying any surcharge imposed to fund the program designed and implemented pursuant to this article.
(4)
(5)Any surcharge imposed to fund the program designed and implemented pursuant to this article shall not be imposed upon the portion of any gas customers procurement of natural gas that is used or employed for a purpose that Section 896 excludes from being categorized as the consumption of natural gas.
(5)
(6)The gas corporation or other person or entity providing revenue cycle services, as defined in Section 328.1, shall be responsible for collecting the surcharge.
(c)Funds shall be allocated for the benefit of gas customers in the form of customer rebates to promote utilization of solar water heating systems.
(1)On and after January 1, 2017, the rebate amount shall be consistent with the amount the commission established for the calendar year 2016 until revised by the commission pursuant to paragraph (2).
(2)Beginning in 2017, and every two years thereafter, the commission shall consider revisions to the rebate amount, taking into account the cost of installing solar water heating systems and the price of natural gas to end-use customers.
(3)The commission shall ensure that a cap on the maximum rebate amount does not unreasonably impair the ability of industrial customers to participate in the program.
(d)In designing and implementing the program required by this article, no moneys shall be diverted from any existing programs for low-income ratepayers or cost-effective energy efficiency programs.
SEC. 5.Section 2864 of the Public Utilities Code is amended to read:2864.(a)The commission, in consultation with the Energy Commission and interested members of the public, shall establish eligibility criteria for solar water heating systems receiving gas customer funded incentives pursuant to this article. The criteria should specify and include all of the following:
(1)Design, installation, and energy output or displacement standards. To be eligible for rebate funding, a residential solar water heating system shall be certified by an accredited listing agency in accordance with standards adopted by the commission. Solar collectors used in systems for multifamily residential, commercial, government, nonprofit, educational, or industrial water heating shall be certified by an accredited listing agency in accordance with standards adopted by the commission. Energy output of collectors and systems shall be determined in accordance with procedures set forth by the listing agency, and shall be based on testing results from accredited testing laboratories.
(2)Require A requirement that solar water heating system components are new and unused, and have not previously been placed in service in any other location or for any other application.
(3)Require A requirement that solar water heating collectors have a warranty of not less than 10 years to protect against defects and undue degradation.
(4)Require A requirement that solar water heating systems are in buildings or facilities connected to a natural gas utilitys distribution system within the state.
(5)Require A requirement that solar water heating systems have meters or other kWhth measuring devices in place to monitor and measure the systems performance and the quantity of energy generated or displaced by the system. The criteria shall require meters for systems with a capacity for displacing over 30 kWth. The criteria may require meters for systems with a capacity of 30 kWth or smaller. The cost of monitoring the system shall not exceed 2 percent of the system cost.
(6)Require A requirement that solar water heating systems are installed in conformity with the manufacturers specifications and all applicable codes and standards.
(b)Gas customer funded incentives shall not be made for a solar water heating system that does not meet the eligibility criteria.
(c)The commission may adopt consensus solar standards applicable to products or systems as developed by accredited standards developers.
SEC. 6.Section 2865 of the Public Utilities Code is amended to read:2865.(a)The commission shall establish conditions on gas customer funded incentives pursuant to this article. The conditions shall require both of the following:
(1)Appropriate siting and high-quality installation of the solar water heating system based on installation guidelines that maximize the performance of the system and prevent qualified systems from being inefficiently or inappropriately installed. The conditions shall not impact housing designs or densities presently authorized by a city, county, or city and county. The goal of this paragraph is to achieve efficient installation of solar water heating systems and promote the greatest energy production or displacement per gas customer dollar.
(2)Appropriate energy efficiency improvements in the new or existing home or facility where the solar water heating system is installed.
(b)The commission shall set rating standards for equipment, components, and systems to ensure reasonable performance and shall develop standards procedures that provide for compliance with the minimum ratings.
SEC. 7.Section 2866 of the Public Utilities Code is amended to read:2866.(a)The commission shall provide not less than 10 percent of the overall funds for installation of solar water heating systems on low-income residential housing.
(b)
2866.(a)The commission may establish a grant program or a revolving loan or loan guarantee program for low-income residential housing consistent with the requirements of Chapter 5.3 (commencing with Section 25425) of Division 15 of the Public Resources Code. All Notwithstanding Section 2867.4, all loans outstanding as of August 1, 2018, 2027, shall continue to be repaid in a manner that is consistent with the terms and conditions of the program adopted and implemented by the commission pursuant to this subdivision, until repaid in full.
(c)
(b)The commission may extend eligibility for funding pursuant to this section to include residential housing occupied by ratepayers participating in a commission approved and supervised gas corporation Low-Income Energy Efficiency (LIEE) program and who either:
(1)Occupy a single-family home.
(2)Occupy at least 50 percent of all units in a multifamily dwelling structure.
(d)
(c)The commission shall ensure that lower income households, as defined in Section 50079.5 of the Health and Safety Code, and, if the commission expands the program pursuant to subdivision (c), (b), ratepayers participating in a LIEE program, that receive gas service at residential housing with a solar water heating system receiving incentives pursuant to subdivision (a), benefit from the installation of the solar water heating systems through reduced or lowered energy costs.
(e)No later than January 1, 2010, the
(d)The commission shall do all of the following to implement the requirements of this section:
(1)Maximize incentives to properties that are committed to continuously serving the needs of lower income households, as defined in Section 50079.5 of the Health and Safety Code, and, if the commission expands the program pursuant to subdivision (c), (b), ratepayers participating in a LIEE program.
(2)Establish conditions on the installation of solar water heating systems that ensure properties on which solar water heating systems are installed under subdivision (a) remain low-income residential properties for at least 10 years from the time of installation, including property ownership restrictions and income rental protections, and appropriate enforcement of these conditions.
(f)All moneys set aside for the purpose of funding the installation of solar water heating systems on low-income residential housing that are unexpended and unencumbered on August 1, 2018, and all moneys thereafter repaid pursuant to subdivision (b), except to the extent that those moneys are encumbered pursuant to this section, shall be utilized to augment cost-effective energy efficiency measures in low-income residential housing that benefit ratepayers.
SEC. 8.Section 2867 of the Public Utilities Code is amended to read:2867.(a)The Consistent with subdivision (c) of Section 2863, the commission shall consider reductions over time in rebates provided through this program shall decline over time. They the program. The rebate shall be structured so as to drive down the cost of the solar water heating technologies, and be paid out on a performance-based incentive basis so that incentives are earned based on the actual energy savings, or on predicted energy savings as established by the commission.
(b)The commission shall consider federal tax credits and other incentives available for this technology when determining the appropriate rebate amount.
(c)The commission shall consider the impact of rebates for solar water heating systems pursuant to this article on existing incentive programs for energy efficiency technology.
(d)In coordination with the commission, the Energy Commission shall consider, when appropriate, coupling rebates for solar water heating systems with complementary energy efficiency technologies, including, but not limited to, efficient hot water heating tanks and tankless or on demand hot water systems that can be installed in addition to the solar water heating system.
SEC. 9.Section 2867.1 of the Public Utilities Code is repealed.2867.1.(a)Not later than July 1, 2010, the commission shall report to the Legislature as to the effectiveness of the program and make recommendations as to any changes that should be made to the program. This report shall include justification for the size of the rebate program in terms of total available incentive moneys as well as the anticipated benefits of the program in its entirety. To facilitate the understanding of how solar water heating systems compare with other clean energy and energy efficiency technologies, all documents related to and rebates provided by this program shall be measured in both kWhth and therms of natural gas saved.
(b)Not later than February 1, 2014, the commission shall complete a review of whether the rebate levels established by the commission will be sufficient to spur investment to reach the program goal of installing 200,000 solar water heating systems in homes, businesses, and other buildings or facilities receiving natural gas service throughout the state by 2017, and shall report to the Legislature on the results of its review. The report submitted pursuant to this subdivision shall be submitted in compliance with Section 9795 of the Government Code.
SEC. 10.Section 2867.2 of the Public Utilities Code is repealed.2867.2.Except for the Solar Water Heating Pilot Program in San Diego, solar water heating technologies shall not be eligible for California Solar Initiative (CSI) funds, pursuant to Section 2851, unless they also displace electricity, in which case only the electricity displacing portion of the technology may be eligible under the CSI program, as determined by the commission.
SEC. 11.Section 2867.3 of the Public Utilities Code is amended to read:2867.3.In order to further the state goal of encouraging the installation of 200,000 solar water heaters by 2017, the The governing body of each publicly owned utility providing gas service to retail end-use gas customers shall, after a public proceeding, adopt, implement, and finance a solar water heating system incentive program that does all the following:
(a)Ensures that any solar water heating system receiving monetary incentives complies with eligibility criteria adopted by the governing body. The eligibility criteria shall include those elements contained in paragraphs (1) to (6), inclusive, of subdivision (a) of Section 2864.
(b)Includes minimum ratings and standards for equipment, components, and systems to ensure reasonable performance and compliance with the minimum ratings and standards.
(c)Includes an element that addresses the installation of solar water heating systems on low-income residential housing. If deemed appropriate in consultation with the California Tax Credit Allocation Committee, the governing board may establish a grant program or a revolving loan or loan guarantee program for low-income residential housing consistent with the requirements of Chapter 5.3 (commencing with Section 25425) of Division 15 of the Public Resources Code.
SEC. 12.Section 2867.4 of the Public Utilities Code is repealed.2867.4.This article shall remain in effect only until August 1, 2018, and as of that date is repealed, unless a later enacted statute, that is enacted before August 1, 2018, deletes or extends that date.
SEC. 13.Section 2867.4 is added to the Public Utilities Code, to read:2867.4.This article shall become inoperative on August 1, 2027, and, as of January 1, 2028, is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2028, deletes or extends the dates on which it becomes inoperative and is repealed.
SEC. 14.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because a local agency or school district has the authority to levy service charges, fees, or assessments sufficient to pay for the program or level of service mandated by this act or because costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.
SECTION 1.Section 2851 of the Public Utilities Code is amended to read:2851.(a)In implementing the California Solar Initiative, the commission shall do all of the following:
(1)(A)The commission shall authorize the award of monetary incentives for up to the first megawatt of alternating current generated by solar energy systems that meet the eligibility criteria established by the Energy Commission pursuant to Chapter 8.8 (commencing with Section 25780) of Division 15 of the Public Resources Code. The commission shall determine the eligibility of a solar energy system, as defined in Section 25781 of the Public Resources Code, to receive monetary incentives until the time the Energy Commission establishes eligibility criteria pursuant to Section 25782. Monetary incentives shall not be awarded for solar energy systems that do not meet the eligibility criteria. The incentive level authorized by the commission shall decline each year following implementation of the California Solar Initiative, at a rate of no less than an average of 7 percent per year, and, except as provided in subparagraph (B), shall be zero as of December 31, 2016. The commission shall adopt and publish a schedule of declining incentive levels no less than 30 days in advance of the first decline in incentive levels. The commission may develop incentives based upon the electricity generated by the system, provided those incentives are consistent with the declining incentive levels of this paragraph and the incentives apply to only the first megawatt of electricity generated by the system.
(B)The incentive level for the installation of a solar energy system pursuant to Section 2852 shall be zero as of December 31, 2021.
(2)The commission shall adopt a performance-based incentive program so that by January 1, 2008, 100 percent of incentives for solar energy systems of 100 kilowatts or greater and at least 50 percent of incentives for solar energy systems of 30 kilowatts or greater are earned based on the actual electrical output of the solar energy systems. The commission shall encourage, and may require, performance-based incentives for solar energy systems of less than 30 kilowatts. Performance-based incentives shall decline at a rate of no less than an average of 7 percent per year. In developing the performance-based incentives, the commission may:
(A)Apply performance-based incentives only to customer classes designated by the commission.
(B)Design the performance-based incentives so that customers may receive a higher level of incentives than under incentives based on installed electrical capacity.
(C)Develop financing options that help offset the installation costs of the solar energy system, provided that this financing is ultimately repaid in full by the consumer or through the application of the performance-based rebates.
(3)By January 1, 2008, the commission, in consultation with the Energy Commission, shall require reasonable and cost-effective energy efficiency improvements in existing buildings as a condition of providing incentives for eligible solar energy systems, with appropriate exemptions or limitations to accommodate the limited financial resources of low-income residential housing.
(4)Notwithstanding subdivision (g) of Section 2827, the commission may develop a time-variant tariff that creates the maximum incentive for ratepayers to install solar energy systems so that the systems peak electricity production coincides with Californias peak electricity demands and that ensures that ratepayers receive due value for their contribution to the purchase of solar energy systems and customers with solar energy systems continue to have an incentive to use electricity efficiently. In developing the time-variant tariff, the commission may exclude customers participating in the tariff from the rate cap for residential customers for existing baseline quantities or usage by those customers of up to 130 percent of existing baseline quantities, as required by Section 739.9. Nothing in this paragraph authorizes the commission to require time-variant pricing for ratepayers without a solar energy system.
(b)Notwithstanding subdivision (a), in implementing the California Solar Initiative, the commission may authorize the award of monetary incentives for solar thermal and solar water heating devices, in a total amount up to one hundred million eight hundred thousand dollars ($100,800,000).
(c)(1)In implementing the California Solar Initiative, the commission shall not allocate more than fifty million dollars ($50,000,000) to research, development, and demonstration that explores solar technologies and other distributed generation technologies that employ or could employ solar energy for generation or storage of electricity or to offset natural gas usage. Any program that allocates additional moneys to research, development, and demonstration shall be developed in collaboration with the Energy Commission to ensure there is no duplication of efforts, and adopted by the commission through a rulemaking or other appropriate public proceeding. Any grant awarded by the commission for research, development, and demonstration shall be approved by the full commission at a public meeting. This subdivision does not prohibit the commission from continuing to allocate moneys to research, development, and demonstration pursuant to the self-generation incentive program for distributed generation resources originally established pursuant to Chapter 329 of the Statutes of 2000, as modified pursuant to Section 379.6.
(2)The Legislature finds and declares that a program that provides a stable source of monetary incentives for eligible solar energy systems will encourage private investment sufficient to make solar technologies cost effective.
(d)(1)The commission shall not impose any charge upon the consumption of natural gas, or upon natural gas ratepayers, to fund the California Solar Initiative.
(2)Notwithstanding any other provision of law, any charge imposed to fund the program adopted and implemented pursuant to this section shall be imposed upon all customers not participating in the California Alternate Rates for Energy (CARE) or family electric rate assistance (FERA) programs, including those residential customers subject to the rate limitation specified in Section 739.9 for existing baseline quantities or usage up to 130 percent of existing baseline quantities of electricity.
(3)The costs of the program adopted and implemented pursuant to this section shall not be recovered from customers participating in the California Alternate Rates for Energy or CARE program established pursuant to Section 739.1, except to the extent that program costs are recovered out of the nonbypassable system benefits charge authorized pursuant to Section 399.8.
(e)Except as provided in subdivision (f), in implementing the California Solar Initiative, the commission shall ensure that the total cost over the duration of the program does not exceed three billion five hundred fifty million eight hundred thousand dollars ($3,550,800,000). Except as provided in subdivision (f), financial components of the California Solar Initiative shall consist of the following:
(1)Programs under the supervision of the commission funded by charges collected from customers of San Diego Gas and Electric Company, Southern California Edison Company, and Pacific Gas and Electric Company. Except as provided in subdivision (f), the total cost over the duration of these programs shall not exceed two billion three hundred sixty-six million eight hundred thousand dollars ($2,366,800,000) and includes moneys collected directly into a tracking account for support of the California Solar Initiative.
(2)Programs adopted, implemented, and financed in the amount of seven hundred eighty-four million dollars ($784,000,000), by charges collected by local publicly owned electric utilities pursuant to Section 2854. Nothing in this subdivision shall give the commission power and jurisdiction with respect to a local publicly owned electric utility or its customers.
(3)(A)Programs for the installation of solar energy systems on new construction (New Solar Homes Partnership Program), administered by the Energy Commission, and funded by charges in the amount of four hundred million dollars ($400,000,000), collected from customers of San Diego Gas and Electric Company, Southern California Edison Company, and Pacific Gas and Electric Company. If the commission is notified by the Energy Commission that funding available pursuant to Section 25751 of the Public Resources Code for the New Solar Homes Partnership Program and any other funding for the purposes of this paragraph have been exhausted, the commission may require an electrical corporation to continue administration of the program pursuant to the guidelines established for the program by the Energy Commission, until the funding limit authorized by this paragraph has been reached. The commission may determine whether a third party, including the Energy Commission, should administer the utilitys continuation of the New Solar Homes Partnership Program. The commission, in consultation with the Energy Commission, shall supervise the administration of the continuation of the New Solar Homes Partnership Program by an electrical corporation or third-party administrator. After the exhaustion of funds, the Energy Commission shall notify the Joint Legislative Budget Committee 30 days prior to the continuation of the program. This subparagraph shall become inoperative on June 1, 2018.
(B)If the commission requires a continuation of the program pursuant to subparagraph (A), any funding made available pursuant to the continuation program shall be encumbered through the issuance of rebate reservations by no later than June 1, 2018, and disbursed by no later than December 31, 2021.
(4)The changes made to this subdivision by Chapter 39 of the Statutes of 2012 do not authorize the levy of a charge or any increase in the amount collected pursuant to any existing charge, nor do the changes add to, or detract from, the commissions existing authority to levy or increase charges.
(f)Upon the expenditure or reservation in any electrical corporations service territory of the amount specified in paragraph (1) of subdivision (e) for low-income residential housing programs pursuant to subdivision (c) of Section 2852, the commission shall authorize the continued collection of the charge for the purposes of Section 2852. The commission shall ensure that the total amount collected pursuant to this subdivision does not exceed one hundred eight million dollars ($108,000,000). Upon approval by the commission, an electrical corporation may use amounts collected pursuant to subdivision (e) for purposes of funding the general market portion of the California Solar Initiative, that remain unspent and unencumbered after December 31, 2016, to reduce the electrical corporations portion of the total amount collected pursuant to this subdivision.
(a)In implementing the California Solar Initiative, the commission shall do all of the following:
(1)(A)The commission shall authorize the award of monetary incentives for up to the first megawatt of alternating current generated by solar energy systems that meet the eligibility criteria established by the Energy Commission pursuant to Chapter 8.8 (commencing with Section 25780) of Division 15 of the Public Resources Code. The commission shall determine the eligibility of a solar energy system, as defined in Section 25781 of the Public Resources Code, to receive monetary incentives until the time the Energy Commission establishes eligibility criteria pursuant to Section 25782. Monetary incentives shall not be awarded for solar energy systems that do not meet the eligibility criteria. The incentive level authorized by the commission shall decline each year following implementation of the California Solar Initiative, at a rate of no less than an average of 7 percent per year, and, except as provided in subparagraph (B), shall be zero as of December 31, 2016. The commission shall adopt and publish a schedule of declining incentive levels no less than 30 days in advance of the first decline in incentive levels. The commission may develop incentives based upon the output of electricity from electricity generated by the system, provided those incentives are consistent with the declining incentive levels of this paragraph and the incentives apply to only the first megawatt of electricity generated by the system.
(B)The incentive level for the installation of a solar energy system pursuant to Section 2852 shall be zero as of December 31, 2021.
(2)The commission shall adopt a performance-based incentive program so that by January 1, 2008, 100 percent of incentives for solar energy systems of 100 kilowatts or greater and at least 50 percent of incentives for solar energy systems of 30 kilowatts or greater are earned based on the actual electrical output of the solar energy systems. The commission shall encourage, and may require, performance-based incentives for solar energy systems of less than 30 kilowatts. Performance-based incentives shall decline at a rate of no less than an average of 7 percent per year. In developing the performance-based incentives, the commission may:
(A)Apply performance-based incentives only to customer classes designated by the commission.
(B)Design the performance-based incentives so that customers may receive a higher level of incentives than under incentives based on installed electrical capacity.
(C)Develop financing options that help offset the installation costs of the solar energy system, provided that this financing is ultimately repaid in full by the consumer or through the application of the performance-based rebates.
(3)By January 1, 2008, the commission, in consultation with the Energy Commission, shall require reasonable and cost-effective energy efficiency improvements in existing buildings as a condition of providing incentives for eligible solar energy systems, with appropriate exemptions or limitations to accommodate the limited financial resources of low-income residential housing.
(4)Notwithstanding subdivision (g) of Section 2827, the commission may develop a time-variant tariff that creates the maximum incentive for ratepayers to install solar energy systems so that the systems peak electricity production coincides with Californias peak electricity demands and that ensures that ratepayers receive due value for their contribution to the purchase of solar energy systems and customers with solar energy systems continue to have an incentive to use electricity efficiently. In developing the time-variant tariff, the commission may exclude customers participating in the tariff from the rate cap for residential customers for existing baseline quantities or usage by those customers of up to 130 percent of existing baseline quantities, as required by Section 739.9. Nothing in this paragraph authorizes the commission to require time-variant pricing for ratepayers without a solar energy system.
(b)Notwithstanding subdivision (a), in implementing the California Solar Initiative, the commission may authorize the award of monetary incentives for solar thermal and solar water heating devices, in a total amount up to one hundred million eight hundred thousand dollars ($100,800,000).
(c)(1)In implementing the California Solar Initiative, the commission shall not allocate more than fifty million dollars ($50,000,000) to research, development, and demonstration that explores solar technologies and other distributed generation technologies that employ or could employ solar energy for generation or storage of electricity or to offset natural gas usage. Any program that allocates additional moneys to research, development, and demonstration shall be developed in collaboration with the Energy Commission to ensure there is no duplication of efforts, and adopted by the commission through a rulemaking or other appropriate public proceeding. Any grant awarded by the commission for research, development, and demonstration shall be approved by the full commission at a public meeting. This subdivision does not prohibit the commission from continuing to allocate moneys to research, development, and demonstration pursuant to the self-generation incentive program for distributed generation resources originally established pursuant to Chapter 329 of the Statutes of 2000, as modified pursuant to Section 379.6.
(2)The Legislature finds and declares that a program that provides a stable source of monetary incentives for eligible solar energy systems will encourage private investment sufficient to make solar technologies cost effective.
(d)(1)The commission shall not impose any charge upon the consumption of natural gas, or upon natural gas ratepayers, to fund the California Solar Initiative.
(2)Notwithstanding any other provision of law, any charge imposed to fund the program adopted and implemented pursuant to this section shall be imposed upon all customers not participating in the California Alternate Rates for Energy (CARE) or family electric rate assistance (FERA) programs, including those residential customers subject to the rate limitation specified in Section 739.9 for existing baseline quantities or usage up to 130 percent of existing baseline quantities of electricity.
(3)The costs of the program adopted and implemented pursuant to this section shall not be recovered from customers participating in the California Alternate Rates for Energy or CARE program established pursuant to Section 739.1, except to the extent that program costs are recovered out of the nonbypassable system benefits charge authorized pursuant to Section 399.8.
(e)Except as provided in subdivision (f), in implementing the California Solar Initiative, the commission shall ensure that the total cost over the duration of the program does not exceed three billion five hundred fifty million eight hundred thousand dollars ($3,550,800,000). Except as provided in subdivision (f), financial components of the California Solar Initiative shall consist of the following:
(1)Programs under the supervision of the commission funded by charges collected from customers of San Diego Gas and Electric Company, Southern California Edison Company, and Pacific Gas and Electric Company. Except as provided in subdivision (f), the total cost over the duration of these programs shall not exceed two billion three hundred sixty-six million eight hundred thousand dollars ($2,366,800,000) and includes moneys collected directly into a tracking account for support of the California Solar Initiative.
(2)Programs adopted, implemented, and financed in the amount of seven hundred eighty-four million dollars ($784,000,000), by charges collected by local publicly owned electric utilities pursuant to Section 2854. Nothing in this subdivision shall give the commission power and jurisdiction with respect to a local publicly owned electric utility or its customers.
(3)(A)Programs for the installation of solar energy systems on new construction (New Solar Homes Partnership Program), administered by the Energy Commission, and funded by charges in the amount of four hundred million dollars ($400,000,000), collected from customers of San Diego Gas and Electric Company, Southern California Edison Company, and Pacific Gas and Electric Company. If the commission is notified by the Energy Commission that funding available pursuant to Section 25751 of the Public Resources Code for the New Solar Homes Partnership Program and any other funding for the purposes of this paragraph have been exhausted, the commission may require an electrical corporation to continue administration of the program pursuant to the guidelines established for the program by the Energy Commission, until the funding limit authorized by this paragraph has been reached. The commission may determine whether a third party, including the Energy Commission, should administer the utilitys continuation of the New Solar Homes Partnership Program. The commission, in consultation with the Energy Commission, shall supervise the administration of the continuation of the New Solar Homes Partnership Program by an electrical corporation or third-party administrator. After the exhaustion of funds, the Energy Commission shall notify the Joint Legislative Budget Committee 30 days prior to the continuation of the program. This subparagraph shall become inoperative on June 1, 2018.
(B)If the commission requires a continuation of the program pursuant to subparagraph (A), any funding made available pursuant to the continuation program shall be encumbered through the issuance of rebate reservations by no later than June 1, 2018, and disbursed by no later than December 31, 2021.
(4)The changes made to this subdivision by Chapter 39 of the Statutes of 2012 do not authorize the levy of a charge or any increase in the amount collected pursuant to any existing charge, nor do the changes add to, or detract from, the commissions existing authority to levy or increase charges.
(f)Upon the expenditure or reservation in any electrical corporations service territory of the amount specified in paragraph (1) of subdivision (e) for low-income residential housing programs pursuant to subdivision (c) of Section 2852, the commission shall authorize the continued collection of the charge for the purposes of Section 2852. The commission shall ensure that the total amount collected pursuant to this subdivision does not exceed one hundred eight million dollars ($108,000,000). Upon approval by the commission, an electrical corporation may use amounts collected pursuant to subdivision (e) for purposes of funding the general market portion of the California Solar Initiative, that remain unspent and unencumbered after December 31, 2016, to reduce the electrical corporations portion of the total amount collected pursuant to this subdivision.
|
Date
|
Status
|
|---|---|
| May 31, 2016 | Read second time and amended. Ordered returned to second reading. |
| Aug 11, 2016 | In committee: Held under submission. |
| Aug 1, 2016 | In committee: Referred to APPR. suspense file. |
| Jun 28, 2016 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 6. Noes 3.) (June 27). Re-referred to Com. on APPR. |
| Jun 16, 2016 | In committee: Hearing postponed by committee. |
| Jun 14, 2016 | From committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on E., U., & C. |
| Jun 9, 2016 | Referred to Com. on E., U., & C. |
| Jun 6, 2016 | In Senate. Read first time. To Com. on RLS. for assignment. |
| Jun 2, 2016 | Read third time. Passed. Ordered to the Senate. (Ayes 52. Noes 26.) |
| Jun 2, 2016 | Read third time. Passed. Ordered to the Senate. (Ayes 52. Noes 26. Page 5195.) |
| Jun 2, 2016 | Read third time. Passed. Ordered to the Senate. |
| Jun 1, 2016 | Read second time. Ordered to third reading. |
| Feb 19, 2016 | Introduced. To print. |
| May 27, 2016 | From committee: Amend, and do pass as amended. (Ayes 14. Noes 6.) (May 27). |
| May 4, 2016 | In committee: Set, first hearing. Referred to APPR. suspense file. |
| Apr 21, 2016 | Re-referred to Com. on APPR. |
| Apr 20, 2016 | Read second time and amended. |
| Apr 19, 2016 | From committee: Amend, and do pass as amended and re-refer to Com. on APPR. (Ayes 10. Noes 3.) (April 13). |
| Mar 28, 2016 | Re-referred to Com. on U. & C. |
| Mar 17, 2016 | Referred to Com. on U. & C. |
| Mar 17, 2016 | From committee chair, with author's amendments: Amend, and re-refer to Com. on U. & C. Read second time and amended. |
| Feb 22, 2016 | Read first time. |
| Feb 21, 2016 | From printer. May be heard in committee March 22. |
|
Date
|
Description
|
Location
|
Votes
|
|
|---|---|---|---|---|
| Aug 1, 2016 | Placed on suspense file | Senate Standing Committee on Appropriations |
Passed |
|
| Jun 27, 2016 | Do pass, but first be re-referred to the Committee on [Appropriations] | Senate Standing Committee on Energy, Utilities and Communications |
Passed |
|
| Jun 2, 2016 | AB 2460 IRWIN Assembly Third Reading | Assembly Floor |
Passed |
|
| May 27, 2016 | Do pass as amended. | Assembly Standing Committee on Appropriations |
Passed |
|
| Apr 13, 2016 | Do pass as amended and be re-referred to the Committee on [Appropriations] | Assembly Standing Committee on Utilities and Commerce |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
|
Organization
|
Position
|
Date
|
|---|---|---|
| Brightline Defense Project | * Support | Apr 13, 2016 |
| California Solar Energy Industries Association | ** Support | Apr 13, 2016 |
| CALSEIA | * Support | Apr 13, 2016 |
| Center for Sustainable Energy | ** Support | Apr 13, 2016 |
| Environment California | ** Support | Apr 13, 2016 |
| FAFCO | ** Support | Apr 13, 2016 |
| Mercy Housing | ** Support | Apr 13, 2016 |
| Page O | ** Support | Apr 13, 2016 |
| Promise Energy | * Support | Apr 13, 2016 |
| Solartek | ** Support | Apr 13, 2016 |
| UMA Solar | * Support | Apr 13, 2016 |
SENATE COMMITTEE ON APPROPRIATIONS
Senator Ricardo Lara, Chair
2015 - 2016 Regular Session
AB 2460 (Irwin) - Solar thermal systems
Version: June 14, 2016 | Policy Vote: E., U., & C. 6 - 3 |
Urgency: No | Mandate: Yes |
Hearing Date: August 1, 2016 | Consultant: Narisha Bonakdar |
This bill meets the criteria for referral to the Suspense File.
Bill Summary:
AB 2460 extends the California Solar Initiative thermal rebate program (Program) by five years and establishes a program funding cap of $250 million.
Fiscal Impact:
- $159,000 (Public Utilities Commission Utilities Reimbursement Account) to the California Public Utilities Commission (CPUC) to implement the revised and continued program.
- Up to $250 million (ratepayer funds) to fund the program.
Background:
Existing law establishes the California Solar Initiative (CSI) to incentivize the installation of solar photovoltaic and solar thermal systems for customers of the state’s investor-owned utilities and publicly owned utilities. It also requires the CPUC to implement a program funded by $250 million in ratepayer surcharges to promote the installation of 200,000 solar water heating systems by 2017, if it determines that it is cost effective.
Solar Thermal Systems. Solar thermal systems are systems used to collect solar energy to generate thermal energy or electrical energy for use in industry, and in the residential and commercial sectors. Solar thermal systems differ from solar photovoltaic systems, which generate electricity rather than heat. Thermal energy is used to heat water or other fluids, and can also power solar cooling systems.
The CSI Thermal Rebate Program. The Program was created by legislation in 2007 to reduce the use of natural gas in meeting heating demand in buildings. The program, administered by investor-owned utilities (IOUs) under the supervision of the CPUC, provides rebates to utility customers who install solar thermal systems to replace water-heating systems powered by electricity or natural gas. The CPUC did not begin implementation of the program until 2010 and promoted solar water heating through direct financial incentives to retail customers, training for installers and building inspectors, and a statewide marketing campaign.
Goal of 200,000 Solar Water Heating Systems Fell Short. In 2014, the State Auditor issued a report on California Alternative Energy and Energy Efficiency Initiatives where it stated that the Program will not install enough solar water heating systems to meet its goal by the time the program ends in 2017. The State Auditor recommended the Legislature consider whether it wants to continue authorizing the collection of ratepayers' money to fund the program.
Proposed Law:
This bill:
- Extends the Program by five years, from January 1, 2017 to July 31, 2022.
- Establishes maximum funding for the program at $250,000,000.
- Reserves 50 percent of the total program budget for installation of solar thermal systems in low-income residential housing or in buildings in disadvantaged communities, as defined by Health and Safety Code §39711.
- Authorizes the CPUC to revise the percentage cited in the preceding bullet if the budget for other types of customers becomes depleted.
- Requires the governing body of each publicly owned utility providing gas service to adopt, implement, and finance a solar thermal system incentive program.
- Directs the CPUC, every two years, to consider revisions to the rebate amount, taking into account the cost of installing solar thermal systems and the price of natural gas to end-use customers.
Staff Comments:
This bill specifies a $250 million total program budget through the duration of the Program (through 2022). This approach—capping the program budget—differs from the approach of past legislation. The previous approach directed the CPUC to establish the surcharge on IOU natural gas customers at an amount necessary to achieve the statutorily goal of installing 200,000 solar water heating systems in California by 2017.
The amount in this bill, however, corresponds with the original program budget identified by CPUC needed to meet the statutory program goals. Because the program has already paid out $40 million, this $250,000 cap represents an increase over the initial program budget.
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SENATE COMMITTEE ON ENERGY, UTILITIES AND COMMUNICATIONS
Senator Ben Hueso, Chair
2015 - 2016 Regular
Bill No: AB 2460 Hearing Date: 6/27/2016
Author: | Irwin | ||
Version: | 6/14/2016 As Amended | ||
Urgency: | No | Fiscal: | Yes |
Consultant: | Jay Dickenson | ||
SUBJECT: Solar thermal systems
DIGEST: This bill extends by five years the California Solar Initiative thermal rebate program by five years and establishes a program funding cap of $250 million.
ANALYSIS:
Existing law:
- Establishes a surcharge on all natural gas consumed in the state to fund low-income assistance programs, energy efficiency programs, and public interest research and development programs. (Public Utilities Code §890 et seq.)
- Establishes the California Solar Initiative (CSI) to incentivize the installation of solar photovoltaic and solar thermal systems for customers of the state’s investor-owned utilities and publicly owned utilities. (Public Utilities Code §2851 et seq.)
- Requires the California Public Utilities Commission (CPUC), if it determines that it is cost effective for ratepayers and in the public interest, to implement a CSI Thermal rebate program funded by $250 million in ratepayer surcharges to promote the installation of 200,000 solar water heating systems that displace the use of natural gas in California homes and businesses by 2017. (Public Utilities Code §2860 et seq.)
- Requires the California Environmental Protection Agency to identify “Disadvantaged communities” in order to help direct investments to disadvantaged communities. (Health and Safety Code §39711 et seq.)
This bill:
- Extends the CSI Thermal rebate program by five years, from January 1, 2017 to July 31, 2022.
- Establishes maximum funding for the program at $250,000,000.
- Reserves 50 percent of the total program budget for installation of solar thermal systems in low-income residential housing or in buildings in disadvantaged communities, as defined by Health and Safety Code §39711.
- Authorizes the CPUC to revise the percentage cited in the preceding bullet if the budget for other types of customers becomes depleted.
- Requires the governing body of each publicly owned utility providing gas service to adopt, implement, and finance a solar thermal system incentive program.
- Directs the CPUC, every two years, to consider revisions to the rebate amount, taking into account the cost of installing solar thermal systems and the price of natural gas to end-use customers.
Background
Natural Gas Consumption in California. Natural gas is one of the big three fossil fuels used around the world. Although it burns cleaner than gasoline and diesel, it still releases carbon dioxide (CO2), monoxide, and other carbon compounds in the atmosphere, thus contributing towards the greenhouse effect. Further, natural gas is non-renewable and will eventually be depleted like other fossil fuels. It is not a sustainable form of energy.
According to the California Energy Commission (CEC), natural gas consumption is driven mostly by space and water heating, followed distantly by cooking and other uses. Residential water heating alone uses 2.5 billion therms, which is equal to the total storage capacity of natural gas in the state, including Aliso Canyon.
Figure ES1 and Table ES1 displays the proportions of energy consumption for each end use in the residential and commercial sectors.
Solar Thermal Systems. Solar thermal systems are systems used to collect solar energy to generate thermal energy or electrical energy for use in industry, and in the residential and commercial sectors. Solar thermal systems differ from solar photovoltaic systems, which generate electricity rather than heat. Thermal energy is used to heat water or other fluids, and can also power solar cooling systems.
The CSI Thermal Rebate Program. The CSI thermal program was created by legislation in 2007 to reduce the use of natural gas in meeting heating demand in buildings. The program, administered by investor-owned utilities (IOUs) under the supervision of the CPUC, provides rebates to utility customers who install solar thermal systems to replace water-heating systems powered by electricity or natural gas. The CPUC did not begin implementation of the program until 2010 and promoted solar water heating through direct financial incentives to retail customers, training for installers and building inspectors, and a statewide marketing campaign.
According to the CPUC, the CSI Thermal program has reduced over 24,000 metric tons of annual CO2 emissions to date, which is the equivalent of taking over 5,000 cars off the road.
Goal of 200,000 Solar Water Heating Systems Fell Short. In 2014, the State Auditor issued a report on California Alternative Energy and Energy Efficiency Initiatives where it stated that the CSI Thermal Program will not install enough solar water heating systems to meet its goal by the time the program ends in 2017. The State Auditor recommended the Legislature consider whether it wants to continue authorizing the collection of ratepayers' money to fund the program.
This bill extends the program by five years but removes the goal of installing 200,000 solar water heating systems.
Aliso Canyon. Natural gas is a highly flammable substance that can cause significantly more damage should there be an accident. Natural gas leaks can cause fires or explosions, if not handled carefully. It is colorless, tasteless and odorless and cannot be detected by smell unless an odorant is added to it.
The Aliso Canyon natural gas storage facility is an underground storage facility near Los Angeles, CA. It is the second-largest gas storage facility of its kind in the United States. A leak was discovered by employees on October 23, 2015. On February 18, 2016, state officials announced that the leak was permanently plugged.
The CPUC is in the rulemaking process to complete a proposed action plan to reprioritize the CSI Thermal Rebate program to mitigate natural gas supply shortage due to the Alison Canyon natural gas leak in 2015. On May 6, 2016, the CPUC Energy Division approved temporary additional program incentives in SoCal Gas’ service territory.
More time, more money? As briefly described above, the CPUC did not begin implementation of the rebate program until 2010. Market conditions – namely the great recession, the extreme drop in the price of natural gas, and a failure to see significant decreases in the costs to install solar thermal systems – diminished program activity. The CPUC has revised the program several times in recent years, including rejiggering rebate amounts and allocations across program sectors. The program has been more active very recently than in past years, yet, it sunsets on January 1, 2018. Given the recent uptick in program activity, it makes sense to extend the program, as this bill does.
This bill also specifies a total program budget through its duration at the end of 2022 shall not exceed $250 million. This approach – capping the program budget – differs from the approach of past legislation, which directed the CPUC to establish the surcharge on IOU natural gas customers at an amount needed to achieve a statutorily specified goal: installing 200,000 solar water heating systems, or the equivalent output of 200,000 solar water heating systems, on homes, businesses, and buildings or facilities of eligible customer classes receiving natural gas service in California by 2017. The amount in this bill, however, corresponds the original program budget identified by CPUC needed to meet the statutory program goals. Because the program has already paid out $40 million, this $250,000 cap represents an increase over the initial program budget. It is not clear why such a budget increase is needed when their remains available from the given program budget $115 million for rebates in general.[1]
Prior/Related Legislation
AB 1470 (Huffman, Chapter 536, Statutes of 2007) created the CSI Thermal rebate program, a $250 million incentive program to promote the installation of 200,000 solar water heating systems that displace the use of natural gas in California homes and businesses by 2017.
AB 2249 (Buchanan, Chapter 607, Statues of 2012) directed the CPUC to complete a review of whether the rebate levels established in the CSI Thermal rebate program will be sufficient to reach the goal of 200,000 solar water heating systems by 2017, and to report the results of the review to the Legislature.
FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: Yes
SUPPORT:
California Solar Energy Industries Association (Source)
ACR Solar International Corp.
All Valley Solar, Inc.
Ameco Solar
Aztec Solar, Inc.
Brightline Defense Project
California Solar Thermal, Inc.
Center for Sustainable Energy
Coalition for Clean Air
Environment California
Environmental Defense Fund
Environmental Solar Design, Inc.
FAFCO, Inc.
Heliodyne, Inc.
International Association of Plumbing and Mechanical Officials
Mercy Housing
Promise Energy
Sierra Club California
Solar Forward
SolarCraft Services, Inc.
Sol-tek
SunChiller, Inc.
SunEarth, Inc.
Sun Light & Power
Suntrek
SunUp Solar Systems, Inc.
SunVapor
The Greenlining Institute
UMA Solar
OPPOSITION:
Howard Jarvis Taxpayers Association
ARGUMENTS IN SUPPORT: According the author:
Solar thermal is a proven technology to significantly reduce natural gas use for heating water in homes and businesses. In the context of the Aliso Canyon natural gas leak, solar thermal is about helping move the state off of its heavy reliance on natural gas, meeting our climate change goals while also protecting residents. As part of our state’s programs that target the reduction of our overall use of natural gas, the recently revamped CSI Thermal program should be continued.
Importantly, low-income residents should be a central focus of the state’s growing solar water heating market. Low-income residents spend proportionately more of their income on energy, meaning the rebates will go further to help those households. Demand for solar thermal in low-income multifamily housing buildings is high, accounting for nearly half of the applications in 2015. As of December 2015, the $25 million in funding for low-income customers is fully exhausted. The CSI Thermal Program Administrators recently stated low-income projects are crucial to maximizing the CSI Thermal Program’s effectiveness.
AB 2460 will extend CSI Thermal program funding for ten years through 2027, and target significant resources for solar thermal on low-income housing and buildings in disadvantaged communities. This bill will also ensure that the maximum rebate cap works for industrial customers, enabling solar thermal systems for the largest users of natural gas. This bill will also improve the effectiveness of the incentives by directing the CPUC to review the incentive levels every two years to adjust for natural gas price fluctuations.
The CSI Thermal Program Administrators are Pacific Gas and Electric Company, Center for Sustainable Energy, and Southern California Gas Company. Advice Letter sent to CPUC on Feb 26, 2016.
ARGUMENTS IN OPPOSITION: The Howard Jarvis Taxpayers Association contends this bill extend yet another wasteful program.
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ASSEMBLY THIRD READING
ATR Bill Id:AB 2460
Author:(Irwin)
As Amended Ver:May 31, 2016
Majority vote
Committee | Votes | Ayes | Noes |
Utilities | 10-3 | Gatto, Burke, Eggman, Cristina Garcia, Eduardo Garcia, Roger Hernández, Quirk, Santiago, Ting, Mark Stone | Patterson, Chávez, Obernolte |
Appropriations | 14-6 | Gonzalez, Bloom, Bonilla, Bonta, Calderon, Daly, Eggman, Eduardo Garcia, Roger Hernández, Holden, Quirk, Santiago, Weber, Wood | Bigelow, Chang, Gallagher, Jones, Obernolte, Wagner |
SUMMARY: Extends and modifies an existing incentive program for solar water heating systems administered by investor-owned utilities under the supervision of the California Public Utilities Commission (CPUC). Specifically, this bill:
- Extends, expands and modifies the existing program to promote the installation of solar thermal systems throughout the state. The original program was for solar water heating systems only.
- Establishes a $250 million funding cap for the program between January 1, 2017, and July 31, 2022. The previous funding cap was $250 million over the first 10 years of the program.
- Requires 50% of the total program budget for projects in low-income residential housing or in buildings in disadvantaged communities, as defined by CalEnviro Screen. Reserves 10% of the total program for industrial applications.
- Requires the governing body of each publicly-owned utility providing gas service to adopt, implement, and finance a solar thermal system incentive program until August 1, 2027.
FISCAL EFFECT: According to the Assembly Appropriations Committee:
- This bill allocates up to $250 million from ratepayers to fund this incentive program through the year 2027.
Currently, the program is designed to support the installation of 200,000 solar water heaters by 2017 funded by up to $250 million in ratepayer surcharges. The current program has been included in rates since 2007 and has expended $45 million of the original $250 million allocated.
- Ongoing CPUC annual costs of approximately $130,000 to implement and administer the revised and continued program through 2027 (CPUC Utilities Reimbursement Account).
COMMENTS:
- Purpose: According to the author, although the enabling legislation was passed in 2007, California Solar Initiative (CSI) Thermal rebates were not made available until 2010. In addition, it is unclear whether the CPUC has authorized sufficient marketing and education about this program.
In 2014, the State Auditor issued a report on California Alternative Energy and Energy Efficiency Initiatives where it stated that the CSI Thermal Program will not install enough solar water heating systems to meet its goal by the time the program ends in 2017. The State Auditor recommended the Legislature consider whether it wants to continue authorizing the collection of ratepayers' money to fund the program.
The author intends this bill to extend the program in order to give it time to work as intended, dedicate at least 50% of rebates to disadvantaged communities, require the CPUC to review the rebate amount more frequently, and increase the overall program budget.
- Background: In 2007, AB 1470 (Huffman), Chapter 536, created the CSI Thermal rebate program to reduce the use of natural gas in buildings through solar heating technologies. CSI Thermal rebates were made available in 2010.
According to the CPUC, the current annual energy savings for this program is more than 4.5 million therms, almost one million kilowatt hours, and nearly 25 thousand tons of greenhouse gas (GHG) emission reductions. The current program has paid out about $45 million in incentives since 2010. The majority of these funds have been used to fund commercial multifamily housing and low income multifamily housing projects ($35 million).
As part of the proposed action plan developed by the CPUC, the California Energy Commission, and the Los Angeles Department of Water and Power, reprioritizing the existing solar thermal program to fund projects installable by summer 2017 is recommended. The plan notes that funds from this program for low-income customers have been fully utilized. This bill apportions 50% of the budget to low income and disadvantaged communities.
Solar thermal can be used to meet the needs of food, beverage, textiles, paper and pulp industries. Processes like sterilizing, pasteurizing, drying, hydrolyzing, distillation and evaporation, and washing and cleaning do not require high temperatures and could benefit from the use of solar thermal technologies.
Analysis Prepared by: Sue Kateley / U. & C. / (916) 319-2083 FN: 0003232
Date of Hearing: May 4, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
ABPCA Bill Id:AB 2460
Author:(Irwin) – As Amended Ver:April 20, 2016
Policy Committee: | Utilities and Commerce | Vote: | 10 - 3 |
|
|
Urgency: No State Mandated Local Program: Yes Reimbursable: No
SUMMARY:
This bill extends and modifies an existing incentive program for solar water heating systems administered by investor-owned utilities under the supervision of the California Public Utilities Commission (PUC). Specifically, this bill:
- Extends, expands and modifies the existing program to promote the installation of solar thermal systems throughout the state. The original program was for solar water heating systems only.
- Establishes a $1 billion funding cap for the program between January 1, 2017, and July 31, 2027. The previous funding cap was $250 million over the first 10 years of the program.
- Requires 50% of the total program budget for projects in low-income residential housing or in buildings in disadvantaged communities, as defined by CalEnviro Screen. Reserves 10% of the total program for industrial applications.
- Requires the governing body of each publicly-owned utility providing gas service to adopt, implement, and finance a solar thermal system incentive program until August 1, 2027.
FISCAL EFFECT:
- This bill allocates up to $1 billion from ratepayers to fund this incentive program through the year 2027,
Currently, the program is designed to support the installation of 200,000 solar water heaters by 2017 funded by up to $250 million in ratepayer surcharges. The current program has been included in rates since 2007 and has expended $45 million of the original $250 million allocated.
- Ongoing PUC annual costs of approximately $130,000 to implement and administer the revised and continued program through 2027 (PUC Utilities Reimbursement Account).
COMMENTS:
- Purpose. According to the author, although the enabling legislation was passed in 2007, California Solar Initiative (CSI) Thermal rebates were not made available until 2010. In addition, it is unclear whether the PUC has authorized sufficient marketing and education about this program.
In 2014, the State Auditor issued a report on California Alternative Energy and Energy Efficiency Initiatives where it stated that the California Solar Initiative Thermal Program will not install enough solar water heating systems to meet its goal by the time the program ends in 2017. The State Auditor recommended the Legislature consider whether it wants to continue authorizing the collection of ratepayers' money to fund the program.
The author intends this bill to extend the program in order to give it time to work as intended, dedicate at least 50% of rebates to disadvantaged communities, require the PUC to review the rebate amount more frequently, and increase the overall program budget.
- Background. In 2007, AB 1470 (Huffman), Chapter 536, created the CSI Thermal rebate program to reduce the use of natural gas in buildings through solar heating technologies. CSI Thermal rebates were made available in 2010.
According to the PUC, the current annual energy savings for this program is more than 4.5 million therms, almost 1 million kilowatt hours, and nearly 25 thousand tons of greenhouse gas (GHG) emission reductions. The current program has paid out about $45 million in incentives since 2010. The majority of these funds have been used to fund commercial multifamily housing and low income multifamily housing projects ($35 million).
As part of the proposed action plan developed by the PUC, the California Energy Commission (CEC), and the Los Angeles Department of Water and Power (LADWP), reprioritizing the existing solar thermal program to fund projects installable by summer 2017 is recommended. The plan notes that funds from this program for low-income customers have been fully utilized. This bill apportions 50% of the budget to low income and disadvantaged communities.
Solar thermal can be used to meet the needs of food, beverage, textiles, paper and pulp industries. Processes like sterilizing, pasteurizing, drying, hydrolyzing, distillation and evaporation, and washing and cleaning do not require high temperatures and could benefit from the use of solar thermal technologies.
Analysis Prepared by: Jennifer Galehouse / APPR. / (916) 319-2081
Date of Hearing: April 13, 2016
ASSEMBLY COMMITTEE ON UTILITIES AND COMMERCE
Mike Gatto, Chair
ABPCA Bill Id:AB 2460 (
Author:Irwin) – As Amended Ver:March 17, 2016
SUBJECT: Solar thermal systems
SUMMARY: Extends and modifies an existing program that provides incentives for solar water heating incentives and administered by investor-owned utilities under the supervision of the California Public Utilities Commission (CPUC). Specifically, this bill:
- Extends and modifies an existing program to promote the installation of solar water systems throughout the state, set the funding cap for the program between January 1, 2017, and July 31, 2027, at $1 billion, reserve 50% of the total program budget for the installation of solar water heating systems in low-income residential housing or in buildings in disadvantaged communities, and extend the operation of the program through July 31, 2027.
- Requires the governing body of each publicly-owned utility providing gas service, until August 1, 2027, to adopt, implement, and finance a solar water heating system incentive program.
EXISTING LAW establishes a program to support installation of 200,000 solar water heaters by 2017 funded by up to $250 million in ratepayer surcharges. (Public Utilities Code Section 2860)
FISCAL EFFECT: Unknown.
COMMENTS:
- Author's Statement. "The Aliso Canyon natural gas leak and the San Bruno tragedy are stark reminders of the everyday dangers of natural gas. The policies that we set forth must work to reduce our use and reliance on natural gas. One proven and effective technology to reduce natural gas use is solar heating technologies.
"In 2007, AB 1470 [Huffman, Chapter 536, Statutes of 2007] created a solar thermal rebate program. The program was designed to incentivize and create a market for rooftop solar water heating projects. The CPUC did not actually begin the program until 2010. Soon after, natural gas prices plummeted and the rebate designed to simulate solar water heating was too low. It was not until January 2015 that a properly designed rebate was approved and until May 2015 that it was implemented. This finally resulted in steady growth as the program was intended. Now the program is beginning to see some success, but it is scheduled to sunset in 2017."
"AB 2460 is designed to do several things – extend the program in order to give it time to work as intended, dedicate at least 50% of the program rebates to disadvantaged communities, require the CPUC to review the rebate amount more frequently, and increase the overall program budget."
- Current Program: In 2007, AB 1470 (Huffman), Chapter 536, created the CSI Thermal rebate program to reduce the use of natural gas in buildings through solar heating technologies. Approximately 40% of the state's natural gas consumption is used for heat within buildings. Up to 80% of that energy could be provided by rooftop solar heating technologies. Incentives are needed to give consumers a positive economic value for their investment. However, although the legislation was passed in 2007, CSI Thermal rebates were not made available until 2010. In addition, it is unclear whether the CPUC has authorized sufficient marketing and education about this program.
In 2014, the State Auditor issued a report on California Alternative Energy and Energy Efficiency Initiatives[1] where it stated that the California Solar Initiative Thermal Program will not install enough solar water heating systems to meet its goal by the time the program ends in 2017. The State Auditor recommended the Legislature consider whether it wants to continue authorizing the collection of ratepayers' money to fund the program.
According to the CPUC, the current annual energy savings for this program are more than 4.5 million therms, almost 1 million kilowatt hours, and nearly 25 thousand tonnes of greenhouse gas (GHG) emission reductions. The current program has paid out about $45 million in incentives since 2010. The majority of these funds have been used to fund commercial multifamily housing and low income multifamily housing projects ($35 million).
As part of the proposed action plan developed by the CPUC, the California Energy Commission (CEC), and the Los Angeles Department of Water and Power (LADWP), they recommend reprioritizing the existing solar thermal program to fund projects installable by summer 2017. They particularly note that funds from this program for low-income customers have been fully utilized.
- Water Heating Only? This bill specifies a program limited to solar water heating. Yet solar thermal can provide other services, such as space heating and cooling. These other services can not only offset natural gas use but may also offset electricity use.
The author may wish to consider an amendment to revise the definition of solar water heating to instead define solar thermal and make conforming changes to references to solar water heating to instead state solar thermal.
- Impact on Ratepayers: This bill allocates up to $1 billion from ratepayers to fund the incentive program through 2027. If the program does not use the full amount of funds available by 2027, ratepayer funds would not be collected. The current program has been in rates since 2007 and has expended $45 million of the original $250 million allocation.
- Allocation of Funds: This bill apportions 50% of the budget to low income solar water heating. The CPUC is free to allocate the remaining 50% as it determines appropriate. Solar thermal can be used to meet the needs of food, beverage, textiles, paper and pulp industries. Processes like sterilizing, pasteurizing, drying, hydrolyzing, distillation and evaporation, and washing and cleaning do not require high temperatures and could benefit from the use of solar thermal technologies.
The author may wish to consider an amendment to revise the allocation of funds to set aside 10% of the funds to industrial applications.
- Suggested Amendments:
SECTION 1. Section 2860 of the Public Utilities Code is repealed.
SEC. 2. Section 2861 of the Public Utilities Code is amended to read:
2861. As used in this article, the following terms have the following meanings:
(a) “Disadvantaged community” means a community identified by the California Environmental Protection Agency pursuant to Section 39711 of the Health and Safety Code.
(b) “Gas customer” includes both “core” and “noncore” customers, as those terms are used in Chapter 2.2 (commencing with Section 328) of Part 1, that receive retail end-use gas service within the service territory of a gas corporation.
(c) “kWth” or “kilowatts thermal” means the unit of measure of the equivalent thermal capacity of a solar water heating thermal system that is calculated by multiplying the aperture area of the solar collector area of the system, expressed in square meters, by a conversion factor of 0.7.
(d) “kWhth” means kilowatthours thermal as measured by the number of kilowatts thermal generated, or displaced, in an hour.
(e) “Low-income residential housing” means either of the following:
(1) Residential housing financed with low-income housing tax credits, tax-exempt mortgage revenue bonds, general obligation bonds, or local, state, or federal loans or grants, and for which the rents of the occupants who are lower income households, as defined in Section 50079.5 of the Health and Safety Code, do not exceed those prescribed by deed restrictions or regulatory agreements pursuant to the terms of the financing or financial assistance.
(2) A residential complex in which at least 20 percent of the total units are sold or rented to lower income households, as defined in Section 50079.5 of the Health and Safety Code, and the housing units targeted for lower income households are subject to a deed restriction or affordability covenant with a public entity that ensures that the units will be available at an affordable housing cost meeting the requirements of Section 50052.5 of the Health and Safety Code, or at an affordable rent meeting the requirements of Section 50053 of the Health and Safety Code, for a period of not less than 30 years.
(f) “New Solar Homes Partnership” means the 10-year program, administered by the Energy Commission, encouraging solar energy systems in new home construction.
(g) “Solar heating collector” means a device that is used to collect or capture heat from the sun and that is generally, but need not be, located on a roof.
(h) “Solar water heating thermal system” means a solar energy device that has the primary purpose of reducing demand for natural gas or electricity through water heating, space heating or cooling, or other methods of capturing heat energy from the sun to reduce natural gas or electricity consumption in a home, business, or any building or facility receiving natural gas that is subject to the surcharge established pursuant to subdivision (b) of Section 2863, or exempt from the surcharge pursuant to subdivision (c) (b) of Section 2863, and that meets or exceeds the eligibility criteria established pursuant to Section 2864. “Solar water heating thermal systems” include multifamily residential, industrial, governmental, educational, and nonprofit solar pool heating systems, but do not include single-family residential solar pool heating systems.
SEC. 3. Section 2862 of the Public Utilities Code is amended and renumbered to read:
2860. (a) Legislature finds and declares all of the following:
(1) California is heavily dependent on natural gas.
(2) The storage and delivery of natural gas relies on aging infrastructure that is prone to leaks that can damage the environment and imperil public health.
(3) Natural gas is a fossil fuel and a major source of global warming pollution and the pollutants that cause air pollution, including smog.
(4) California’s growing population and economy will put a strain on energy supplies and threaten the ability of the state to meet its global warming goals unless specific steps are taken to reduce demand and generate energy cleanly and efficiently.
(5) Water heating for domestic and industrial use relies almost entirely on natural gas and accounts for a significant percentage of the state’s natural gas consumption.
(6) Solar water thermal heating systems represent the major untapped natural gas saving potential in California.
(7) In addition to financial and energy savings, solar water heating thermal systems can help protect against future gas and electricity shortages and reduce our dependence on foreign sources of energy.
(8) Solar water heating thermal systems can also help preserve the environment and protect public health by reducing air pollution, including carbon dioxide, a leading global warming gas, and nitrogen oxide, a precursor to smog.
(9) Growing demand for these technologies will create jobs in California as well as promote greater energy independence, protect consumers from rising energy costs, and result in cleaner air.
(10) Installing solar water heating thermal systems in disadvantaged communities can provide local economic benefits while advancing the state’s clean energy goals and policies to reduce the emissions of greenhouse gases.
(11) It is in the interest of the State of California to promote solar water heating thermal systems and other technologies that directly reduce demand for natural gas in homes and businesses.
(b) It is the intent of the Legislature to build a mainstream market for solar water heating thermal systems that directly reduces demand for natural gas in homes, businesses, schools, industrial, and nonprofit and government buildings.
(c) It is the intent of the Legislature that the solar water heating thermal system incentives created by this article should be a cost-effective investment by gas customers. Gas customers will recoup the cost of their investment through lower energy bills as a result of avoiding purchases of natural gas.
SEC. 4. Section 2863 of the Public Utilities Code is amended to read:
2863. (a) By July 31, 2017, the commission shall do all of the following:
(1) Implement changes to the program as authorized pursuant to this section on December 31, 2016, applicable to the service territories of a gas corporation to promote the installation of solar water heating thermal systems in homes, businesses, and buildings or facilities of eligible customer classes receiving natural gas service throughout the state. Eligible customer classes shall include single-family and multifamily residential, commercial, industrial, governmental, nonprofit, and primary, secondary, and postsecondary educational customers. The commission shall implement program changes in phases, if necessary, to enable seamless continuation of the availability of rebates as of January 1, 2017.
(2) The program shall be administered by gas corporations or third-party administrators, as determined by the commission, and subject to the supervision of the commission.
(3) The commission shall coordinate the program with the Energy Commission’s programs and initiatives, including, but not limited to, the New Solar Homes Partnership, to achieve the goal of building zero-energy homes.
(b) (1) The commission shall fund the program through the use of a surcharge applied to gas customers based upon the amount of natural gas consumed. The surcharge shall be in addition to any other charges for natural gas sold or transported for consumption in this state.
(2) Funding for the program established by this article shall not, for the collective service territories of all gas corporations, exceed one billion dollars ($1,000,000,000) over the course of the period from January 1, 2017, to July 31, 2027, inclusive.
(3) Fifty percent of the total program budget shall be reserved for the installation of solar water heating thermal systems in low-income residential housing or in buildings in disadvantaged communities. The commission may revise the percentage if the budget for other types of customers becomes depleted.
(4) Ten percent of the total program budget shall be reserved for the installation of solar thermal systems in industrial applications. The commission may revise the percentage if the budget for other types of customers becomes depleted.
(5) The commission shall annually establish a surcharge rate for each class of gas customers. Any gas customer participating in the California Alternate Rates for Energy (CARE) or Family Electric Rate Assistance (FERA) programs shall be exempt from paying any surcharge imposed to fund the program designed and implemented pursuant to this article.
(5) Any surcharge imposed to fund the program designed and implemented pursuant to this article shall not be imposed upon the portion of any gas customer’s procurement of natural gas that is used or employed for a purpose that Section 896 excludes from being categorized as the consumption of natural gas.
(6) The gas corporation or other person or entity providing revenue cycle services, as defined in Section 328.1, shall be responsible for collecting the surcharge.
(c) Funds shall be allocated in the form of customer rebates to promote utilization of solar water heating thermal systems.
(1) On and after January 1, 2017, the rebate amount shall be consistent with the amount the commission established for the calendar year 2016 until revised by the commission pursuant to paragraph (2).
(2) Beginning in 2017, and every two years thereafter, the commission shall consider revisions to the rebate amount, taking into account the cost of installing solar water heating thermal systems and the price of natural gas to end-use customers.
(3) The commission shall ensure that a cap on the maximum rebate amount does not unreasonably impair the ability of industrial customers to participate in the program.
(d) In designing and implementing the program required by this article, no moneys shall be diverted from any existing programs for low-income ratepayers or cost-effective energy efficiency programs.
SEC. 5. Section 2864 of the Public Utilities Code is amended to read:
2864. (a) The commission, in consultation with the Energy Commission and interested members of the public, shall establish eligibility criteria for solar water heating thermal systems receiving gas customer funded incentives pursuant to this article. The criteria should specify and include all of the following:
(1) Design, installation, and energy output or displacement standards. To be eligible for rebate funding, a residential solar water heating thermal system shall be certified by an accredited listing agency in accordance with standards adopted by the commission. Solar collectors used in systems for multifamily residential, commercial, government, nonprofit, educational, or industrial water heating applications shall be certified by an accredited listing agency in accordance with standards adopted by the commission. Energy output of collectors and systems shall be determined in accordance with procedures set forth by the listing agency, and shall be based on testing results from accredited testing laboratories.
(2) A requirement that solar water heating thermal system components are new and unused, and have not previously been placed in service in any other location or for any other application.
(3) A requirement that solar water heating thermal collectors have a warranty of not less than 10 years to protect against defects and undue degradation.
(4) A requirement that solar water heating thermal systems are in buildings or facilities connected to a natural gas utility’s distribution system within the state.
(5) A requirement that solar water heating thermal systems have meters or other kWhth measuring devices in place to monitor and measure the system’s performance and the quantity of energy generated or displaced by the system. The cost of monitoring the system shall not exceed 2 percent of the system cost.
(6) A requirement that solar water heating thermal systems are installed in conformity with the manufacturer’s specifications and all applicable codes and standards.
(b) Gas customer funded incentives shall not be made for a solar water heating thermal system that does not meet the eligibility criteria.
(c) The commission may adopt consensus solar standards applicable to products or systems as developed by accredited standards developers.
SEC. 6. Section 2865 of the Public Utilities Code is amended to read:
2865. (a) The commission shall establish conditions on gas customer funded incentives pursuant to this article. The conditions shall require both of the following:
(1) Appropriate siting and high-quality installation of the solar water heating thermal system based on installation guidelines that maximize the performance of the system and prevent qualified systems from being inefficiently or inappropriately installed. The conditions shall not impact housing designs or densities presently authorized by a city, county, or city and county. The goal of this paragraph is to achieve efficient installation of solar water heating thermal systems and promote the greatest energy production or displacement per gas customer dollar.
(2) Appropriate energy efficiency improvements in the new or existing home or facility where the solar water heating thermal system is installed.
(b) The commission shall set rating standards for equipment, components, and systems to ensure reasonable performance and shall develop procedures that provide for compliance with the minimum ratings.
SEC. 7. Section 2866 of the Public Utilities Code is amended to read:
2866. (a) The commission may establish a grant program or a revolving loan or loan guarantee program for low-income residential housing consistent with the requirements of Chapter 5.3 (commencing with Section 25425) of Division 15 of the Public Resources Code. All Notwithstanding Section 2867.4, all loans outstanding as of August 1, 2018, 2027, shall continue to be repaid in a manner that is consistent with the terms and conditions of the program adopted and implemented by the commission pursuant to this subdivision, until repaid in full.
(b) The commission may extend eligibility for funding pursuant to this section to include residential housing occupied by ratepayers participating in a commission approved and supervised gas corporation Low-Income Energy Efficiency (LIEE) program and who either:
(1) Occupy a single-family home.
(2) Occupy at least 50 percent of all units in a multifamily dwelling structure.
(c) The commission shall ensure that lower income households, as defined in Section 50079.5 of the Health and Safety Code, and, if the commission expands the program pursuant to subdivision (b), ratepayers participating in a LIEE program, that receive gas service at residential housing with a solar water heating system receiving incentives pursuant to subdivision (a), benefit from the installation of the solar water heating thermal systems through reduced or lowered energy costs.
(d) The commission shall do all of the following to implement the requirements of this section:
(1) Maximize incentives to properties that are committed to continuously serving the needs of lower income households, as defined in Section 50079.5 of the Health and Safety Code, and, if the commission expands the program pursuant to subdivision (c), (b), ratepayers participating in a LIEE program.
(2) Establish conditions on the installation of solar water heating thermal systems that ensure properties on which solar water heating thermal systems are installed under subdivision (a) remain low-income residential properties for at least 10 years from the time of installation, including property ownership restrictions and income rental protections, and appropriate enforcement of these conditions.
SEC. 8. Section 2867 of the Public Utilities Code is amended to read:
2867. (a) Consistent with subdivision (c) of Section 2863, the commission shall consider reductions over time in rebates provided through the program. The rebate shall be structured so as to drive down the cost of the solar water heating thermal technologies, and be paid out on a performance-based incentive basis so that incentives are earned based on the actual energy savings, or on predicted energy savings as established by the commission.
(b) The commission shall consider federal tax credits and other incentives available for this technology when determining the appropriate rebate amount.
(c) The commission shall consider the impact of rebates for solar water heating thermal systems pursuant to this article on existing incentive programs for energy efficiency technology.
(d) In coordination with the commission, the Energy Commission shall consider, when appropriate, coupling rebates for solar water heating thermal systems with complementary energy efficiency technologies, including, but not limited to, efficient hot water heating tanks and tankless or on demand hot water systems that can be installed in addition to the solar water heating thermal system.
SEC. 9. Section 2867.1 of the Public Utilities Code is repealed.
SEC. 10. Section 2867.2 of the Public Utilities Code is repealed.
SEC. 11. Section 2867.3 of the Public Utilities Code is amended to read:
2867.3.The governing body of each publicly owned utility providing gas service to retail end-use gas customers shall, after a public proceeding, adopt, implement, and finance a solar water heating thermal system incentive program that does all the following:
(a) Ensures that any solar water heating thermal system receiving monetary incentives complies with eligibility criteria adopted by the governing body. The eligibility criteria shall include those elements contained in paragraphs (1) to (6), inclusive, of subdivision (a) of Section 2864.
(b) Includes minimum ratings and standards for equipment, components, and systems to ensure reasonable performance and compliance with the minimum ratings and standards.
(c) Includes an element that addresses the installation of solar water heating thermal systems on low-income residential housing. If deemed appropriate in consultation with the California Tax Credit Allocation Committee, the governing board may establish a grant program or a revolving loan or loan guarantee program for low-income residential housing consistent with the requirements of Chapter 5.3 (commencing with Section 25425) of Division 15 of the Public Resources Code.
SEC. 12. Section 2867.4 of the Public Utilities Code is repealed.
SEC. 13. Section 2867.4 is added to the Public Utilities Code, to read:
2867.4. This article shall become inoperative on August 1, 2027, and, as of January 1, 2028, is repealed, unless a later enacted statute, that becomes operative on or before January 1, 2028, deletes or extends the dates on which it becomes inoperative and is repealed.
REGISTERED SUPPORT / OPPOSITION:
Support
Aztec Solar
California Solar Energy Industries Association
Center for Sustainable Energy
Environment California
Fafco
Mercy Housing
Solartek
UMA Solar
Opposition
None on file.
Analysis Prepared by: Sue Kateley / U. & C. / (916) 319-2083
Discussed in Hearing
4MIN
Assembly Floor
15MIN
Assembly Standing Committee on Utilities and Commerce
Bill Author
Bill Co-Author(s):