AB 33: 2017 northern California wildfires.
- Session Year: 2017-2018
- House: Assembly
- Latest Version Date: 2018-07-05
Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations. Existing law authorizes the commission to fix just and reasonable rates and charges. The existing restructuring of the electrical services industry provides for the issuance of rate reduction bonds by the California Infrastructure and Economic Development Bank for the recovery of transition costs, as defined, by electrical corporations. Existing law authorizes the commission to issue financing orders, to support the issuance of recovery bonds, as defined, by the recovery corporation, as defined, secured by a dedicated rate component, to finance the unamortized balance of the regulatory asset awarded Pacific Gas and Electric Company in commission Decision 03-12-035.
This bill would revise and recast the law regarding the issuance of financing orders to authorize the commission, upon application by the Pacific Gas and Electric Company, to issue financing orders to support the issuance of recovery bonds to finance costs, in excess of insurance proceeds, incurred, or that are expected to be incurred, by the Pacific Gas and Electric Company, excluding fines and penalties, related to the wildfires that occurred in northern California in 2017, as provided.
Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.
Because the provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by expanding the operation of a crime.
This bill would make legislative findings and declarations as to the necessity of a special statute for the Pacific Gas and Electric Company.
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 a specified reason.
Under existing law, the Public Utilities Commission (PUC) has regulatory authority over public utilities, including electrical corporations. Existing law requires the PUC, in consultation with the State Energy Resources Conservation and Development Commission (Energy Commission), the State Air Resources Board (state board), electrical corporations, and the motor vehicle industry, to evaluate policies to develop infrastructure sufficient to overcome any barriers to the widespread deployment and use of plug-in hybrid and electric vehicles and, by July 1, 2011, to adopt rules that address specified issues. Existing law requires the PUC, in cooperation with the Energy Commission, the state board, air quality management districts and air pollution control districts, electrical and gas corporations, and the motor vehicle industry, to evaluate and implement policies to promote the development of equipment and infrastructure needed to facilitate the use of electric power and natural gas to fuel low-emission vehicles. Existing law, enacted as part of the Clean Energy and Pollution Reduction Act of 2015, requires the PUC, in consultation with the Energy Commission and state board, to direct electrical corporations to file applications for programs and investments to accelerate widespread transportation electrification to reduce dependence on petroleum, meet air quality standards, achieve the goals set forth in the Charge Ahead California Initiative, and reduce emissions of greenhouse gases to 40% below 1990 levels by 2030 and to 80% below 1990 levels by 2050. The PUC is required to approve, or modify and approve, programs and investments in transportation electrification, including those that deploy charging infrastructure, through a reasonable cost recovery mechanism, if they are consistent with the above-described purposes, do not unfairly compete with nonutility enterprises, include performance accountability measures, and are in the interests of ratepayers.This bill would require the PUC, by March 30, 2018, in consultation with the state board and the Energy Commission, to consider authorizing electrical corporations to offer programs and investments that support customers who purchase a used electric vehicle. If authorized by the PUC, the bill would require that the programs and investments be designed to accelerate widespread transportation electrification, achieve ratepayer benefits, reduce dependence on petroleum, meet air quality standards, and reduce emissions of greenhouse gases. If authorized, the bill would require the PUC to review, modify if appropriate, and decide whether to approve each proposal to offer these programs and investments that is filed by an electrical corporation within one year of the date of filing of the completed proposal. If the program is approved, the bill would provide that a participant in the program would receive electrical service for charging their electric vehicles at a grid-integrated rate, as defined. The bill would require that a program approved by the PUC include a reasonable mechanism for cost recovery by the electrical corporation.Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the PUC is a crime.Because the provisions of this bill would be a part of the act and because a violation of an order or decision of the PUC implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.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 a specified reason.Under existing law, the Public Utilities Commission (PUC) has regulatory authority over public utilities, including electrical corporations. Existing law requires the PUC, in consultation with the State Energy Resources Conservation and Development Commission (Energy Commission), the State Air Resources Board (state board), electrical corporations, and the motor vehicle industry, to evaluate policies to develop infrastructure sufficient to overcome any barriers to the widespread deployment and use of plug-in hybrid and electric vehicles and, by July 1, 2011, to adopt rules that address specified issues. Existing law requires the PUC, in cooperation with the Energy Commission, the state board, air quality management districts and air pollution control districts, electrical and gas corporations, and the motor vehicle industry, to evaluate and implement policies to promote the development of equipment and infrastructure needed to facilitate the use of electric power and natural gas to fuel low-emission vehicles.
Existing law, enacted as part of the Clean Energy and Pollution Reduction Act of 2015, requires the PUC, in consultation with the Energy Commission and state board, to direct electrical corporations to file applications for programs and investments to accelerate widespread transportation electrification to reduce dependence on petroleum, meet air quality standards, achieve the goals set forth in the Charge Ahead California Initiative, and reduce emissions of greenhouse gases to 40% below 1990 levels by 2030 and to 80% below 1990 levels by 2050. The PUC is required to approve, or modify and approve, programs and investments in transportation electrification, including those that deploy charging infrastructure, through a reasonable cost recovery mechanism, if they are consistent with the above-described purposes, do not unfairly compete with nonutility enterprises, include performance accountability measures, and are in the interests of ratepayers.
This bill would require the PUC, by March 30, 2018, in consultation with the state board and the Energy Commission, to consider authorizing electrical corporations to offer programs and investments in electric vehicle service equipment, as defined, installed in residential garages of that support customers who purchase a used electric vehicle. If authorized by the PUC, the bill would require that the programs and investments be designed to accelerate widespread transportation electrification, achieve ratepayer benefits, reduce dependence on petroleum, meet air quality standards, and reduce emissions of greenhouse gases. If authorized, the bill would require the PUC to decide, or modify and decide, review, modify if appropriate, and decide whether to approve each proposal to offer these programs and investments that is filed by an electrical corporation within 6 months one year of the date of filing of the completed proposal. If the program is approved, the bill would provide that a participant in the program would receive electrical service for charging their electric vehicles at a grid-integrated rate, as defined. The bill would require that a program approved by the PUC include a reasonable mechanism for cost recovery by the electrical corporation.
Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the PUC is a crime.
Because the provisions of this bill would be a part of the act and because a violation of an order or decision of the PUC implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.
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 a specified reason.
Under existing law, the Public Utilities Commission (PUC) has regulatory authority over public utilities, including electrical corporations. Existing law requires the PUC, in consultation with the State Energy Resources Conservation and Development Commission (Energy Commission), the State Air Resources Board (state board), electrical corporations, and the motor vehicle industry, to evaluate policies to develop infrastructure sufficient to overcome any barriers to the widespread deployment and use of plug-in hybrid and electric vehicles and, by July 1, 2011, to adopt rules that address specified issues. Existing law requires the PUC, in cooperation with the Energy Commission, the state board, air quality management districts and air pollution control districts, electrical and gas corporations, and the motor vehicle industry, to evaluate and implement policies to promote the development of equipment and infrastructure needed to facilitate the use of electric power and natural gas to fuel low-emission vehicles.
Existing law, enacted as part of the Clean Energy and Pollution Reduction Act of 2015, requires the PUC, in consultation with the Energy Commission and state board, to direct electrical corporations to file applications for programs and investments to accelerate widespread transportation electrification to reduce dependence on petroleum, meet air quality standards, achieve the goals set forth in the Charge Ahead California Initiative, and reduce emissions of greenhouse gases to 40% below 1990 levels by 2030 and to 80% below 1990 levels by 2050. The PUC is required to approve, or modify and approve, programs and investments in transportation electrification, including those that deploy charging infrastructure, through a reasonable cost recovery mechanism, if they are consistent with the above-described purposes, do not unfairly compete with nonutility enterprises, include performance accountability measures, and are in the interests of ratepayers.
This bill would require the PUC, by March 30, 2018, in consultation with the state board and the Energy Commission, to authorize consider authorizing electrical corporations to offer programs and investments in electric vehicle service equipment, as defined, installed in residential garages of customers who purchase a used electric vehicle. The If authorized by the PUC, the bill would require that the programs and investments be designed to accelerate widespread transportation electrification, achieve ratepayer benefits, reduce dependence on petroleum, meet air quality standards, and reduce emissions of greenhouse gases. The PUC would be required to approve, or modify and approve, If authorized, the bill would require the PUC to decide, or modify and decide, whether to approve each proposal to offer these programs and investments that is filed by an electrical corporation within 6 months of the date of filing of the completed proposal. The If the program is approved, the bill would provide that a participant in the program shall would receive electrical service at a grid-integrated rate, as defined. The bill would require that a program approved by the PUC include a reasonable mechanism for cost recovery by the electrical corporation and would require that the PUC ensure that this cost recovery is nonbypassable and recoverable from all ratepayers. corporation.
Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the PUC is a crime.
Because the provisions of this bill would be a part of the act and because a violation of an order or decision of the PUC implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.
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 a specified reason.
Under existing law, the Public Utilities Commission (PUC) has regulatory authority over public utilities, including electrical corporations. Existing law requires the PUC, in consultation with the State Energy Resources Conservation and Development Commission (Energy Commission), the State Air Resources Board (state board), electrical corporations, and the motor vehicle industry, to evaluate policies to develop infrastructure sufficient to overcome any barriers to the widespread deployment and use of plug-in hybrid and electric vehicles and, by July 1, 2011, to adopt rules that address specified issues. Existing law requires the PUC, in cooperation with the Energy Commission, the state board, air quality management districts and air pollution control districts, electrical and gas corporations, and the motor vehicle industry, to evaluate and implement policies to promote the development of equipment and infrastructure needed to facilitate the use of electric power and natural gas to fuel low-emission vehicles.
Existing law, enacted as part of the Clean Energy and Pollution Reduction Act of 2015, requires the PUC, in consultation with the Energy Commission and state board, to direct electrical corporations to file applications for programs and investments to accelerate widespread transportation electrification to reduce dependence on petroleum, meet air quality standards, achieve the goals set forth in the Charge Ahead California Initiative, and reduce emissions of greenhouse gases to 40% below 1990 levels by 2030 and to 80% below 1990 levels by 2050. The PUC is required to approve, or modify and approve, programs and investments in transportation electrification, including those that deploy charging infrastructure, through a reasonable cost recovery mechanism, if they are consistent with the above-described purposes, do not unfairly compete with nonutility enterprises, include performance accountability measures, and are in the interests of ratepayers.
This bill would require the PUC, by March 30, 2018, in consultation with the state board and the Energy Commission, to authorize electrical corporations to offer programs and investments in electric vehicle service equipment, as defined, installed in residential garages of customers who purchase a used electric vehicle. The bill would require that the programs and investments be designed to accelerate widespread transportation electrification, achieve ratepayer benefits, reduce dependence on petroleum, meet air quality standards, and reduce emissions of greenhouse gases. The PUC would be required to approve, or modify and approve, each proposal to offer these programs and investments that is filed by an electrical corporation within 6 months of the date of filing of the completed proposal. The bill would provide that a participant in the program shall receive electrical service at a grid-integrated rate, as defined. The bill would require that a program approved by the PUC include a reasonable mechanism for cost recovery by the electrical corporation and would require that the PUC ensure that this cost recovery is nonbypassable and recoverable from all ratepayers.
Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the PUC is a crime.
Because the provisions of this bill would be a part of the act and because a violation of an order or decision of the PUC implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.
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 a specified reason.
The California Global Warming Solutions Act of 2006 establishes the State Air Resources Board as the state agency responsible for monitoring and regulating sources emitting greenhouse gases. The act authorizes the state board to include the use of market-based compliance mechanisms. Existing law requires all moneys, except for fines and penalties, collected by the state board from the auction or sale of allowances as part of a market-based compliance mechanism to be deposited in the Greenhouse Gas Reduction Fund and to be available upon appropriation by the Legislature.This bill would state the intent of the Legislature to enact legislation to reduce net emissions from greenhouse gases from transportation by imposing fees and granting rebates on sales of new automobiles and light trucks.The California Global Warming Solutions Act of 2006 establishes the State Air Resources Board as the state agency responsible for monitoring and regulating sources emitting greenhouse gases. The act authorizes the state board to include the use of market-based compliance mechanisms. Existing law requires all moneys, except for fines and penalties, collected by the state board from the auction or sale of allowances as part of a market-based compliance mechanism to be deposited in the Greenhouse Gas Reduction Fund and to be available upon appropriation by the Legislature.
This bill would state the intent of the Legislature to enact legislation to reduce net emissions from greenhouse gases from transportation by imposing fees and granting rebates on sales of new automobiles and light trucks.
The Legislature finds and declares all of the following:
(a)California faces unprecedented challenges. Climate change increases the odds of extreme weather, such as drought, high winds, low humidity, and heat waves, raising the frequency and severity of wildfires, storms, flooding, and mudslides. Development of housing in fire-prone areas has increased enormously over the past 40 years, thus placing more individuals and more property at risk from catastrophic wildfires. These factors in turn raise the potential liability faced by utilities in inverse condemnation and other claims. In particular, the 2017 northern California wildfires were catastrophic in size and effect.
(b)The potential liability from the 2017 northern California wildfires requires immediate legislative action. The number of persons affected by the wildfires, and the extent of their losses, highlight the need for timely and equitable resolution of their claims. At the same time, the magnitude of potential damage claims undermines Pacific Gas and Electric Companys ability to invest in the infrastructure necessary to meet the states aggressive wildfire mitigation and clean energy plans and has the potential to create an unsustainable hardship for customers if passed on in the form of higher rates through the typical ratemaking processes. The potential liabilities and uncertainties surrounding the timing and extent of cost recovery create an imminent threat to the utilitys financial stability and ability to cost effectively carry out its public service mission.
(c)It is therefore in the public interest to provide a mechanism that will promote timely compensation for 2017 northern California wildfire victims and equitably allocate costs for strict liability inverse condemnation and other wildfire-related claims and costs while maintaining the financial health of the utility so that it is able to continue to provide safe and reliable electric and gas service to customers at affordable rates.
(d)Securitization is a well-established mechanism to reduce customer impacts that has been used successfully in California and in other states. The principal benefits of securitization are a lower cost of financing as compared to other forms of utility borrowing and a smaller rate impact as compared to usual cost recovery measures. Therefore, to minimize the economic impacts on customers, it is in the public interest to repurpose and modernize existing law to allow Pacific Gas and Electric Company the opportunity to securitize, over a reasonable time period, the costs related to 2017 northern California wildfire claims through issuance of recovery bonds funded through a dedicated rate component.
(e)It is therefore also in the public interest for the Public Utilities Commission to issue one or more financing orders, at the request of the utility and subject to the requirements of Article 5.6 (commencing with Section 848) of Chapter 4 of Part 1 of Division 1 of the Public Utilities Code, to securitize costs related to the 2017 northern California wildfires upon a showing that doing so would benefit customers. The commission may adopt cost protection measures to minimize impacts on low-income customers.
(f)The Public Utilities Commission should conduct a prudency review of Pacific Gas and Electric Companys actions related to the 2017 northern California wildfires. In the event the commission determines that any costs or expenses arising from the 2017 northern California wildfires should be disallowed, which may comprise only a portion of such costs or expenses, the commission should direct the utility to credit customers for that disallowed amount, but the commission should not amend, adjust, or modify any financing order the commission may have previously issued authorizing the securitization of costs as provided in Article 5.6 (commencing with Section 848) of Chapter 4 of Part 1 of Division 1 of the Public Utilities Code.
SEC. 2.The heading of Article 5.6 (commencing with Section 848) of Chapter 4 of Part 1 of Division 1 of the Public Utilities Code is amended to read:5.6.Financing Utility Recovery 2017 Northern California Wildfire SecuritizationSEC. 3.Section 848 of the Public Utilities Code is amended to read:848.For the purposes of this article, the following terms shall have the following meanings:
(a)2017 northern California wildfire amounts means all costs, in excess of insurance proceeds, incurred, or that are expected to be incurred, by Pacific Gas and Electric Company, excluding fines or penalties, for both of the following:
(1)Payments to third parties, including government entities, to resolve, by settlement or judgment, claims arising out of wildfires that occurred in northern California in 2017, including claims for property damage, personal injury, and response and suppression costs.
(2)Defense of claims described in subparagraph (A), including attorneys and expert fees.
(b)Ancillary agreement means a bond insurance policy, letter of credit, reserve account, surety bond, swap arrangement, hedging arrangement, liquidity or credit support arrangement, or other similar agreement or arrangement entered into in connection with the issuance of recovery bonds that is designed to promote the credit quality and marketability of the bonds or to mitigate the risk of an increase in interest rates.
(a)(c)Consumer means any individual, governmental body, trust, business entity entity, or nonprofit organization which that consumes electricity that has been transmitted or distributed by means of electric transmission or distribution facilities, whether those electric transmission or distribution facilities are owned by the consumer, the recovery corporation, or any other party.
(d)Financing costs means the costs to issue, service, repay, or refinance recovery bonds, whether incurred or paid upon issuance of the recovery bonds or over the life of the recovery bonds, if they are approved for recovery by the commission in a financing order. Financing costs may include any of the following:
(1)Principal, interest, and redemption premiums that are payable on recovery bonds.
(2)A payment required under an ancillary agreement.
(3)An amount required to fund or replenish reserve accounts or other accounts established under an indenture, ancillary agreement, or other financing document relating to the recovery bonds.
(4)Costs of retiring or funding an existing debt and equity security of a recovery corporation in connection with the issuance of recovery bonds to the extent the securities were issued for the purpose of financing recovery costs.
(5)Costs incurred by, on behalf of, or allocated to, a recovery corporation to obtain modifications of, or amendments to, an indenture, financing agreement, security agreement, or similar agreement or instrument relating to an existing secured or unsecured obligation of a recovery corporation or an affiliate of a recovery corporation, or any costs incurred by, or allocated to, a recovery corporation to obtain the consent, release, waiver, or approval from the holder of the obligation, that are necessary to be incurred to permit a recovery corporation to issue or cause the issuance of recovery bonds.
(6)Taxes, franchise fees, or license fees imposed on fixed recovery charges.
(7)Costs related to issuing and servicing recovery bonds or the application for a financing order, including, without limitation, servicing fees and expenses, trustee fees and expenses, legal fees and expenses, accounting fees, administrative fees, underwriting and placement fees, financial advisory fees, original issue discount, capitalized interest, rating agency fees, and any other related costs that are approved for recovery in the financing order.
(8)Other costs as specifically authorized by a financing order.
(b)(e)Financing entity means the recovery corporation or any subsidiary or affiliate of the recovery corporation that is authorized by the commission to issue recovery bonds or acquire recovery property, or both.
(c)(f)Financing order means an order of the commission adopted in accordance with this article, which shall include, without limitation, a procedure to require the expeditious approval by the commission of periodic adjustments to fixed recovery amounts charges and to any associated fixed recovery tax amounts included in that financing order to ensure recovery of all recovery costs and the costs associated with the proposed recovery, financing, or refinancing thereof, including the costs of servicing and retiring the recovery bonds contemplated by the financing order.
(d)(g)Fixed recovery amounts charges means those nonbypassable rates and other charges, including, but not limited to, distribution, connection, disconnection, and termination rates and charges, that are authorized by the commission in a financing order to recover (1) recovery both of the following:
(1)Recovery costs specified in the financing order, and (2) the order.
(2)The costs of recovering, financing, or refinancing those recovery costs through a plan approved by the commission in the financing order, including the costs of servicing and retiring recovery bonds.
(e)(h)Fixed recovery tax amounts means those nonbypassable rates and other charges, including, but not limited to, distribution, connection, disconnection, and termination rates and charges, that are needed to recover federal and State of California income and franchise taxes associated with fixed recovery amounts charges authorized by the commission in the a financing order and that order, but are not approved as financing costs financed from proceeds of recovery bonds.
(f)(i)Recovery bonds means bonds, notes, certificates of participation or beneficial interest, or other evidences of indebtedness or ownership, issued pursuant to an executed indenture or other agreement of a financing entity, the proceeds of which are used, directly or indirectly, to recover, finance, or refinance recovery costs, and that are directly or indirectly secured by, or payable from, recovery property.
(g)(j)Recovery corporation means Pacific Gas and Electric Company, the electrical corporation described in the commissions Decision No. 03-12-035. Company.
(h)(k)Recovery costs means (1) the unamortized balance of the regulatory asset arising and existing pursuant to the commissions Decision No. 03-12-035, (2) federal any of the following:
(1)The 2017 northern California wildfire amounts authorized by the commission in a financing order for recovery.
(2)Federal and State of California income and franchise taxes associated with recovery of the unamortized balance of that regulatory asset, (3) costs of issuing recovery bonds, and (4) professional amounts pursuant to paragraph (1).
(3)Financing costs.
(4)Professional fees, consultant fees, redemption premiums, tender premiums and other costs incurred by the recovery corporation in using proceeds of recovery bonds to acquire outstanding securities of the recovery corporation. corporation, as authorized by the commission in a financing order.
(i)(l)(1)Recovery property means the property right created pursuant to this article, including, without limitation, the right, title, and interest of the recovery corporation or its transferee:
(A)In and to the tariff fixed recovery charges established pursuant to a financing order, as adjusted from time to time including all rights to obtain adjustments to the fixed recovery charges in accordance with Section 848.1 and the financing order.
(B)To be paid the amount that is determined in a financing order to be the amount that the recovery corporation or its transferee is lawfully entitled to receive pursuant to the provisions of this article and the proceeds thereof, and in and to all revenues, collections, claims, payments, money, moneys, or proceeds of or arising from the tariff or constituting fixed recovery amounts charges that are the subject of a financing order including those nonbypassable rates and other charges referred to in subdivision (d). order.
(C)In and to all rights to obtain adjustments to the tariff relating to fixed recovery amounts pursuant to the terms of Section 848.1 and the financing order.(2)Recovery property shall not include the a right to be paid fixed recovery tax amounts.
(3)Recovery property shall constitute a current property right notwithstanding the fact that the value of the property right will depend on consumers using electricity or, in those instances where consumers are customers of the recovery corporation, the recovery corporation performing certain services.
(j)(m)Service territory means the geographical area that the recovery corporation provided with electric distribution service as of December 19, 2003.
(n)True-up adjustment means an adjustment to the fixed recovery charges as they appear on customer bills that is necessary to correct for any overcollection or undercollection of the fixed recovery charges authorized by a financing order and to otherwise ensure the timely and complete payment and recovery of recovery costs over the authorized repayment term.
SEC. 4.Section 848.1 of the Public Utilities Code is amended to read:848.1.(a)No later than 120 days after the effective date of this article, and from time to time thereafter, the The recovery corporation shall may, upon its election, apply to the commission for a determination that some or all of the recovery corporations its 2017 northern California wildfire amounts and other associated recovery costs may be recovered through fixed recovery amounts, charges, which would be therefore constitute recovery property under this article, and that any portion of the recovery corporations federal and State of California income and franchise taxes associated with those fixed recovery amounts charges and not financed from proceeds of recovery bonds may be recovered through fixed recovery tax amounts. The recovery corporation may request this determination by the commission in a separate proceeding or in an existing proceeding, or both. The recovery corporation shall in its application specify that consumers within its service territory would benefit from reduced rates on a present value basis through the issuance of recovery bonds. The commission shall designate fixed recovery amounts and any associated fixed recovery tax amounts as recoverable in one or more financing orders commission shall issue a financing order if the commission determines, as part of its findings in connection with the financing order, that recovery of recovery costs through the designation of the fixed recovery amounts charges and any associated fixed recovery tax amounts, and the issuance of recovery bonds in connection with fixed recovery amounts, charges, would reduce the rates on a present value basis that consumers within the recovery corporations service territory would pay if the financing order were not adopted. Fixed recovery amounts as compared to the use of traditional utility financing mechanisms, which shall be calculated using the recovery corporations corporate debt and equity in the ratio approved by the commission at the time of the issuance of the financing order. If the commission makes that determination, the commission shall establish, as part of that financing order, a procedure for the recovery corporation to submit advice letters from time to time to request the issuance of additional financing orders designating fixed recovery charges and any associated fixed recovery tax amounts as recoverable. The recovery corporation may submit an advice letter with respect to recovery costs that a recovery corporation (1) has paid, (2) has an existing legal obligation to pay, or (3) would be obligated to pay pursuant to an executed settlement agreement. The commission shall, within 60 days of the filing of that advice letter, issue a financing order, which may take the form of a resolution, if the commission determines that the amounts identified in the advice letter are recovery costs. Fixed recovery charges and any associated fixed recovery tax amounts shall only be imposed only on existing and future consumers in the service territory. Consumers within the service territory shall continue to pay fixed recovery amounts charges and any associated fixed tax recovery tax amounts until the recovery bonds and associated financing costs are paid in full by the financing entity. Once the recovery bonds have been paid in full, the payment by consumers of fixed recovery amounts charges and fixed recovery tax amounts shall terminate. A recovery corporation may exercise the same rights and remedies under its tariff and applicable law and regulation based upon a customers nonpayment of fixed recovery charges and any associated fixed recovery tax as it could for a customers failure to pay any other charge payable to that recovery corporation.
(b)The commission shall establish in a financing order an effective mechanism that ensures recovery of recovery costs through nonbypassable fixed recovery amounts charges and any associated fixed recovery tax amounts from existing and future consumers in the service territory, and those consumers shall be required to pay those charges until the recovery bonds and all associated financing costs are paid in full by the financing entity, at which time those charges shall be terminated. Fixed recovery charges shall be irrevocable, notwithstanding the true-up adjustment pursuant to subdivision (i), provided that the costs shall not be recoverable from any of the following:
(1)New load or incremental load of an existing consumer of the recovery corporation where the load is being met through a direct transaction and the transaction does not require the use of transmission or distribution facilities owned or controlled by the recovery corporation.
(2)Customer Generation generation departing load that is exempt from Department of Water Resources power charges pursuant to the commissions Decision No. 03-04-030, as modified by Decision No. 03-04-041, and as clarified and affirmed by Decision No. 03-05-039, except that the load shall pay the costs as a component of and in proportion to any purchase of electricity delivered by the recovery corporation under standby or other service made following its departure.
(3)The Department of Water Resources, with respect to the pumping, generation, and transmission facilities and operations of the State Water Resources Development System, except to the extent that system facilities receive electric service from the recovery corporation on or after December 19, 2003, under a commission approved tariff.
(4)Retail electric load, continuously served by a local publicly owned electric utility from January 1, 2000, through the effective date of the act adding this section.
(5)Load that thereafter comes to take electric service from a city where all the following conditions are met:
(A)The new load is from locations that never received electric service from the recovery corporation.
(B)The city owns and operates the local publicly owned electric utility.
(C)The local publicly owned electric utility served more than 95 percent of the customers receiving electric service residing within the city limits prior to December 19, 2003.
(D)The city annexed the territory in which the load is located on or after December 19, 2003.
(E)Following annexation, the city provides all municipal services to the annexed territory that the city provides to other territory within the city limits, including electric service.
(F)The total load exempt from paying fixed recovery amounts charges and associated fixed recovery tax amounts pursuant to subparagraphs (A) through to (D), inclusive, does not exceed 50 megawatts, as determined by the commission, and any load above the 50 megawatt 50-megawatt exemption amount shall be responsible for paying recovery amounts charges and associated fixed recovery tax amounts, except as provided in subdivision (c).
(c)Except as provided in paragraphs (4) and (5) of subdivision (b), the commission shall determine the extent to which fixed recovery amounts charges and any associated fixed recovery tax amounts are recoverable from new municipal load, consistent with the commissions determination in the limited rehearing granted in Decision 03-08-076. The determination of the commission shall be made on the earlier of the date it adopts a financing order or December 31, 2004. load.
(d)Except as provided in paragraphs (4) and (5) of subdivision (b) and in subdivision (c), the obligation to pay fixed recovery amounts charges and any associated fixed recovery tax amounts cannot be avoided by the formation of a local publicly owned electric utility on or after December 19, 2003, or by annexation of any portion of the service territory of the recovery corporation by an existing local publicly owned electric utility.
(e)Recovery bonds authorized by the commissions financing orders may be issued in one or more series on or before December 31, 2006. 2030.
(f)The commission may issue financing orders in accordance with this article to facilitate the recovery, financing, or refinancing of recovery costs. A financing order may be adopted only upon the application of the recovery corporation and shall become effective in accordance with its terms only after the recovery corporation files with the commission the recovery corporations written consent to all terms and conditions of the financing order. A financing order may specify how amounts collected from a consumer shall be allocated between fixed recovery amounts, charges, any associated fixed recovery tax amounts, and other charges.
(g)Notwithstanding Section 455.5 or 1708, or any other provision of law, and except as otherwise provided in Section 848.7 or in this subdivision (i), with respect to recovery property that has been made the basis for the issuance of recovery bonds and with respect to any associated fixed recovery tax amounts, the financing order, the fixed recovery amounts charges, and any associated fixed recovery tax amounts shall be irrevocable, and the irrevocable. The commission shall not have authority not, either by rescinding, altering, or amending the financing order or otherwise, to revalue or revise for ratemaking purposes, purposes the recovery costs or the costs of recovering, financing, or refinancing the recovery costs, determine that the fixed recovery amounts, charges, any associated fixed recovery tax amounts or rates are unjust or unreasonable, or in any way reduce or impair the value of recovery property or of the right to receive any associated fixed recovery tax amounts either directly or indirectly by taking fixed recovery amounts charges or any associated fixed recovery tax amounts into account when setting other rates for the recovery corporation or when setting charges for the Department of Water Resources; nor shall the Resources. The amount of revenues arising with respect thereto shall not be subject to reduction, impairment, postponement, or termination. Except as otherwise provided in this subdivision, the The State of California does hereby pledge and agree with the recovery corporation, owners of recovery property, financing entities, and holders of recovery bonds that the state shall neither limit nor alter alter, except as otherwise provided with respect to the true-up adjustment of the fixed recovery amounts, charges pursuant to subdivision (i), the fixed recovery charges, any associated fixed recovery tax amounts, recovery property, financing orders, or any rights thereunder under a financing order until the recovery bonds, together with the interest thereon, on the recovery bonds and associated financing costs, are fully paid and discharged, and any associated fixed recovery tax amounts have been satisfied or, in the alternative, have been refinanced through an additional issue of recovery bonds; bonds, provided that nothing contained in this section shall preclude the limitation or alteration if and when adequate provision shall be made by law for the protection of the recovery corporation, owners, and holders. corporation and of owners and holders of the recovery bonds. The financing entity is authorized to include this pledge and undertaking for the state in these recovery bonds. Notwithstanding any other provision of this section, the commission shall approve adjustments to the fixed recovery amounts and any associated fixed recovery tax amounts as may be necessary to ensure timely recovery of all recovery costs that are the subject of the pertinent financing order, and the costs of capital associated with the recovery, financing, or refinancing thereof, including servicing and retiring the recovery bonds contemplated by the financing order. When setting other rates for the recovery corporation, nothing in this subdivision shall prevent the commission from taking into account either of the following:
(1)Any collection of fixed recovery amounts charges in excess of amounts actually required to pay recovery costs financed or refinanced by recovery bonds.
(2)Any collection of fixed recovery tax amounts in excess of amounts actually required to pay federal and State of California income and franchise taxes associated with fixed recovery amounts; charges, provided that this would not result in a recharacterization of the tax, accounting, and other intended characteristics of the financing, including, but not limited to, either of the following:
(A)Treating the recovery bonds as debt of the recovery corporation or its affiliates for federal income tax purposes.
(B)Treating the transfer of the recovery property by the recovery corporation as a true sale for bankruptcy purposes.
(h)(1)Financing Neither financing orders nor recovery bonds issued under this article do not shall constitute a debt or liability of the state or of any political subdivision thereof, and do not nor shall they constitute a pledge of the full faith and credit of the state or any of its political subdivisions, but are payable solely from the funds provided therefor under this article and shall be consistent with Sections 1 and 18 of Article XVI of the California Constitution. This subdivision shall in no way preclude bond guarantees or enhancements pursuant to this article. All recovery bonds shall contain on the face thereof a statement to the following effect: Neither the full faith and credit nor the taxing power of the State of California is pledged to the payment of the principal of, or interest on, this bond.
(2)The issuance of recovery bonds under this article shall not directly, indirectly, or contingently obligate the state or any political subdivision thereof to levy or to pledge any form of taxation therefor or to make any appropriation for their payment.
(i)The commission shall establish procedures for the expeditious processing of applications an application for a financing orders, including order, which shall provide for the approval or disapproval thereof of the application within 120 days of the recovery corporation making application therefor. application. Any fixed recovery charge authorized by a financing order shall appear on consumer bills. The commission shall provide shall, in any financing order order, provide for a procedure for the expeditious approval by the commission of periodic adjustments true-up adjustments to the fixed recovery amounts and any associated fixed recovery tax amounts that are the subject of the pertinent financing order, as required by subdivision (g). The procedure shall require the commission to determine whether the adjustments are required on each anniversary of the issuance of the financing order, and at the additional intervals as may be provided for in the financing order, and for the adjustments, if required, to be approved within 90 days of each anniversary of the issuance of the financing order, or of each additional interval provided for in the financing order. fixed recovery charges, which shall be made at least annually and may be made more frequently. The recovery corporation shall file an advice letter with the commission to implement any true-up adjustment.
(j)Fixed recovery amounts charges are recovery property when, and to the extent that, a financing order authorizing the fixed recovery amounts charges has become effective in accordance with this article, and the recovery property shall thereafter continuously exist as property for all purposes with purposes, and all of the rights and privileges of relating to that property accorded by this article shall continuously exist for the period and to the extent provided in the financing order, but in any event until the recovery bonds are paid in full, including all principal, interest, premium, costs, and arrearages thereon. premiums, if any, and interest with respect to the recovery bonds, and all associated financing costs are paid in full. A financing order may provide that the creation of recovery property shall be simultaneous with the sale of the recovery property to a transferee or assignee as provided in the application of the pledge of the recovery property to secure the recovery bonds.
(k)Notwithstanding anything in this article:
(1)The commission may not order or otherwise require, directly or indirectly, a recovery corporation to use recovery bonds to finance recovery costs.
(2)The commission may not refuse to allow the recovery corporation to recover recovery costs solely because a recovery corporation elected or may elect to finance those costs through a financing mechanism other than the issuance of recovery bonds.
(3)If a recovery corporation elects not to finance recovery costs through the issuance of recovery bonds as authorized by a financing order, recovery costs shall be recovered as authorized by the commission previously or in subsequent proceedings.
(l)The commission may set a discount for collection of recovery charges from low-income customers that is no less than the existing California Alternate Rates for Energy program discount, if it determines that the discount will have no significant impact on the ability of the financing entity to finance recovery costs. The commission may also allow the adjustment of the amount of the fixed recovery charges, as necessary, to cover any costs associated with implementation of the discount.
(k)(m)This article and any financing order made pursuant to this article do not amend, reduce, modify, or otherwise affect the right of the Department of Water Resources to recover its revenue requirements and to receive the charges that it is to recover and receive pursuant to Division 27 (commencing with Section 80000) of the Water Code, or pursuant to any agreement entered into by the commission and the Department of Water Resources pursuant to that division.
SEC. 5.Section 848.2 of the Public Utilities Code is amended to read:848.2.(a)The financing entity may issue recovery bonds upon approval by the commission in the pertinent financing orders. Recovery bonds shall be nonrecourse to the credit or any assets of the recovery corporation, other than the recovery property as specified in the pertinent financing order.
(b)The recovery corporation may sell and assign all or portions of its interest in recovery property to one or more financing entities that make that recovery property the basis for issuance of recovery bonds, to the extent approved in the a financing order. The recovery corporation or financing entity may pledge recovery property as collateral, directly or indirectly, for recovery bonds to the extent approved in the pertinent financing orders providing for a security interest in the recovery property, in the manner set forth in Section 848.3. In addition, recovery property may be sold or assigned by either of the following: (1) the financing entity or a trustee for the holders of recovery bonds or the holders of an ancillary agreement in connection with the exercise of remedies upon a default, or (2) any person acquiring the recovery property after a sale or assignment pursuant to this subdivision. article.
(c)To the extent that any interest in recovery property is so sold or sold, assigned, or is so pledged as collateral, collateral pursuant to subdivision (b), the commission shall authorize the recovery corporation to contract with the financing entity that it will continue to operate its system to provide service to consumers within its service territory, will collect amounts in respect of the fixed recovery amounts charges for the benefit and account of the financing entity, and will account for and remit these amounts to or for the account of the financing entity. Contracting with the financing entity in accordance with that authorization shall not impair or negate the characterization of the sale, assignment, or pledge as an absolute transfer, a true sale, or a security interest, as applicable. To the extent that billing, collection, and other related services with respect to the provision of electric service are provided to a consumer by any person or entity other than the recovery corporation in whose service territory the consumer is located, except as provided in subdivision (b) of Section 848.1, that person or entity shall collect the fixed recovery charges and any associated fixed recovery tax amounts from the consumer for the benefit and account of the recovery corporation or financing entity with the associated revenues remitted solely for the benefit and repayment of the recovery bonds and associated financing costs as a condition to the provision of electric service to that consumer. Each financing order shall impose commercially reasonable terms, consistent with the purposes and objectives of this article, on any person or entity responsible for billing, collection, and other related services, including, without limitation, collection of the fixed recovery charges and any associated fixed recovery tax amounts, that are the subject of the financing order.
(d)Recovery property that is specified in a financing order shall constitute an existing, present property right, notwithstanding the fact that the imposition and collection of fixed recovery charges depend on the recovery corporation continuing to provide electricity service or continuing to perform its servicing functions relating to the collection of fixed recovery charges or on the level of future electricity consumption. Recovery property shall exist whether or not the fixed recovery charges have been billed, have accrued, or have been collected and notwithstanding the fact that the value for a security interest in the recovery property, or amount of the recovery property, is dependent on the future provision of service to consumers. All recovery property specified in a financing order shall continue to exist until the recovery bonds issued pursuant to a financing order and all associated financing costs are paid in full.
(e)Recovery property, fixed recovery charges, and the interests of an assignee, bondholder or financing entity, or any pledgee in recovery property and fixed recovery charges are not subject to setoff, counterclaim, surcharge, recoupment, or defense by the recovery corporation or any other person or in connection with the bankruptcy, reorganization, or other insolvency proceeding of the recovery corporation, any affiliate of the recovery corporation, or any other entity.
(d)(f)Notwithstanding Section 1708 or any other provision of law, any requirement under this article or a financing order that the commission take action with respect to the subject matter of a financing order shall be binding upon the commission, as it may be constituted from time to time, and any successor agency exercising functions similar to the commission, and the commission shall have no authority to rescind, alter, or amend that requirement in a financing order. The approval by the commission in a financing order of the issuance by the recovery corporation or a financing entity of recovery bonds shall include the approvals, if any, as may be required by Article 5 (commencing with Section 816) and Section 701.5. Nothing in Section 701.5 shall be construed to prohibit the issuance of recovery bonds upon the terms and conditions as may be approved by the commission in a financing order. Section 851 is not applicable to the transfer or pledge of recovery property, the issuance of recovery bonds, or related transactions approved in a financing order.
SEC. 6.Section 848.3 of the Public Utilities Code is amended to read:848.3.(a)A security interest in recovery property is valid, is enforceable against the pledgor and third parties, is subject to the rights of any third parties holding security interests in the recovery property perfected in the manner described in this section, and attaches when all of the following have taken place:
(1)The commission has issued the a financing order authorizing the fixed recovery amounts charges included in the recovery property.
(2)Value has been given by the pledgees of the recovery property.
(3)The pledgor has signed a security agreement covering the recovery property.
(b)A valid and enforceable security interest in recovery property is perfected when it has attached and when a financing statement has been filed in accordance with Chapter 5 (commencing with Section 9501) of Division 9 of the Commercial Code naming the pledgor of the recovery property as debtor and identifying the recovery property. Any description of the recovery property shall be sufficient if it refers to the financing order creating the recovery property. A copy of the financing statement shall be filed with the commission by the recovery corporation that is the pledgor or transferor of the recovery property, and the commission may require the recovery corporation to make other filings with respect to the security interest in accordance with procedures it may establish, provided that the filings shall not affect the perfection of the security interest.
(c)A perfected security interest in recovery property is a continuously perfected security interest in all recovery property revenues and proceeds arising with respect thereto, proceeds, whether or not the revenues or proceeds have accrued. Conflicting security interests shall rank according to priority in time of perfection. Recovery property shall constitute property for all purposes, including for contracts securing recovery bonds, whether or not the recovery property revenues and proceeds arising with respect thereto have accrued.
(d)Subject to the terms of the security agreement covering the recovery property and the rights of any third parties holding security interests in the recovery property perfected in the manner described in this section, the validity and relative priority of a security interest created under this section is not defeated or adversely affected by the commingling of revenues arising with respect to the recovery property revenues with other funds of the recovery corporation that is the pledgor or transferor of the recovery property, or by any security interest in a deposit account of that recovery corporation perfected under Division 9 (commencing with Section 9101) of the Commercial Code into which the revenues are deposited. Subject to the terms of the security agreement, upon compliance with the requirements of paragraph (1) of subdivision (b) of Section 9312 of the Commercial Code, the pledgees of the recovery property shall have a perfected security interest in all cash and deposit accounts of the recovery corporation in which revenues arising with respect to the recovery property revenues have been commingled with other funds, but the perfected security interest shall be limited to an amount not greater than the amount of the revenues with respect to the recovery property revenues received by the recovery corporation within 12 months before (1) any default under the security agreement or (2) the institution of insolvency proceedings by or against the recovery corporation, less payments from the revenues to the pledgees during that 12-month period.
(e)If an event of a default occurs under the security agreement covering the recovery property, the pledgees of the recovery property, subject to the terms of the security agreement, shall have all rights and remedies of a secured party upon default under Division 9 (commencing with Section 9101) of the Commercial Code, and are entitled to foreclose or otherwise enforce their security interest in the recovery property, subject to the rights of any third parties holding prior security interests in the recovery property perfected in the manner provided in this section. In addition, the commission may require in the financing order creating the recovery property that, in the event of default by the recovery corporation in payment of revenues arising with respect to the recovery property, recovery property revenues, the commission and any successor thereto, upon the application by the pledgees or transferees, including transferees under Section 848.4, of the recovery property, and without limiting any other remedies available to the pledgees or transferees by reason of the default, shall order the sequestration and payment to the pledgees or transferees of revenues arising with respect to the recovery property. recovery property revenues. Any order shall remain in full force and effect notwithstanding any bankruptcy, reorganization, or other insolvency proceedings with respect to the debtor. debtor, pledgor, or transferor of the recovery property. Any surplus in excess of amounts necessary to pay principal, premium, premiums, if any, interest, costs, and arrearages on the recovery bonds, and other associated financing costs arising under the security agreement, shall be remitted to the debtor. debtor or to the pledgor or transferor.
(f)Section 5451 of the Government Code shall not apply to any pledge of recovery property by a financing entity. Sections 9204 and 9205 of the Commercial Code apply to a pledge of recovery property by the recovery corporation, an affiliate of the recovery corporation, or a financing entity.
(g)This section sets forth the terms by which a consensual security interest can shall be created and perfected in the recovery property. Unless otherwise ordered by the commission with respect to any series of recovery bonds on or prior to the issuance of the series, there shall exist a statutory lien as provided in this subdivision. Upon the effective date of the financing order, there shall exist a first priority lien on all recovery property then existing or thereafter arising pursuant to the terms of the financing order. This lien shall arise by operation of this section automatically without any action on the part of the recovery corporation, any affiliate thereof, the financing entity, or any other person. This lien shall secure all obligations, then existing or subsequently arising, to the holders of the recovery bonds issued pursuant to the financing order, the trustee or representative for the holders, and any other entity specified in the financing order. The persons for whose benefit this lien is established shall, upon the occurrence of any defaults specified in the financing order, have all rights and remedies of a secured party upon default under Division 9 (commencing with Section 9101) of the Commercial Code, and are entitled to foreclose or otherwise enforce this statutory lien in the recovery property. This lien attaches to the recovery property regardless of who owns, or is subsequently determined to own, the recovery property, including the recovery corporation, any affiliate thereof, the financing entity, or any other person. This lien shall be valid, perfected, and enforceable against the owner of the recovery property and all third parties upon the effectiveness of the financing order without any further public notice; provided, however, that any person may, but is not required to, file a financing statement in accordance with subdivision (b). Financing statements so filed may be protective filings and are not evidence of the ownership of the recovery property.
A perfected statutory lien in recovery property is a continuously perfected lien in all recovery property revenues and proceeds arising with respect thereto, proceeds, whether or not the revenues or proceeds have accrued. Conflicting liens shall rank according to priority in time of perfection. Recovery property shall constitute property for all purposes, including for contracts securing recovery bonds, whether or not the recovery property revenues and proceeds arising with respect thereto have accrued.
In addition, the commission may require, in the financing order creating the recovery property, that, in the event of default by the recovery corporation in the payment of revenues arising with respect to recovery property, property revenues, the commission and any successor thereto, upon the application by the beneficiaries of the statutory lien, and without limiting any other remedies available to the beneficiaries by reason of the default, shall order the sequestration and payment to the beneficiaries of revenues arising with respect to the recovery property. property revenues. Any order shall remain in full force and effect notwithstanding any bankruptcy, reorganization, or other insolvency proceedings with respect to the debtor. Any surplus in excess of amounts necessary to pay principal, premium, premiums, if any, interest, costs, and arrearages on the recovery bonds, and other costs arising in connection with the documents governing the recovery bonds, shall be remitted to the debtor.
SEC. 7.Section 848.4 of the Public Utilities Code is amended to read:848.4.(a)A transfer of recovery property by the recovery corporation to an affiliate or to a financing entity, or by an affiliate of the recovery corporation or a financing entity to another financing entity, which the parties in the governing documentation have expressly stated to be a sale or other absolute transfer, in a transaction approved in a financing order, shall be treated as an absolute transfer of all of the transferors right, title, and interest (as interest, as in a true sale), sale, and not as a pledge or other financing, of the recovery property, other than for federal and state income and franchise tax purposes. The grant to holders of recovery bonds of a preferred right to revenues of the recovery corporation, or the provision by the company of other credit enhancement with respect to recovery bonds, shall not impair or negate the characterization of any transfer as a true sale, other than for federal and state income and franchise tax purposes.
(b)The characterization of the sale, assignment, or transfer as an absolute transfer and true sale and the corresponding characterization of the property interest of the purchaser shall not be affected or impaired by, among other things, the occurrence of any of the following:
(1)Commingling of fixed recovery charge revenues with other amounts.
(2)The retention by the seller of either of the following:
(A)A partial or residual interest, including an equity interest, in the financing entity or the recovery property, whether direct or indirect, subordinate or otherwise.
(B)The right to recover costs associated with taxes, franchise fees, or license fees imposed on the collection of fixed recovery charges.
(3)Any recourse that the purchaser may have against the seller.
(4)Any indemnification rights, obligations, or repurchase rights made or provided by the seller.
(5)The obligation of the seller to collect fixed recovery charges on behalf of an assignee.
(6)The treatment of the sale, assignment, or transfer for tax, financial reporting, or other purposes.
(7)Any true-up adjustment of the fixed recovery charges as provided in the financing order.
(b)(c)A transfer of recovery property shall be deemed perfected as against third persons when both of the following have taken place: occur:
(1)The commission has issued issues the financing order authorizing the fixed recovery amounts charges included in the recovery property.
(2)An assignment of the recovery property in writing has been executed and delivered to the transferee.
(c)(d)As between bona fide assignees of the same right for value without notice, the assignee first filing a financing statement in accordance with Chapter 5 (commencing with Section 9501) of Division 9 of the Commercial Code naming the assignor of the recovery property as debtor and identifying the recovery property has priority. Any description of the recovery property is shall be sufficient if it refers to the financing order creating the recovery property. A copy of the financing statement shall be filed by the assignee with the commission, and the commission may require the assignor or the assignee to make other filings with respect to the transfer in accordance with procedures it may establish, but these filings shall not affect the perfection of the transfer.
SEC. 8.Section 848.6 of the Public Utilities Code is amended to read:848.6.The authority of the commission to issue financing orders pursuant to Section 848.1 shall expire on December 31, 2006. 2030. The expiration of the authority shall have no effect upon financing orders adopted by the commission pursuant to this article or any recovery property arising therefrom, or upon the charges authorized to be levied thereunder, or the rights, interests, and obligations of the recovery corporation or a financing entity or holders of recovery bonds pursuant to the financing order, or the authority of the commission to monitor, supervise, or take further action with respect to the order in accordance with the terms of this article and of the order.
SEC. 9.Section 848.7 of the Public Utilities Code is repealed.848.7.Notwithstanding subdivision (g) of Section 848.1, the commission shall credit ratepayers, in a manner to be determined by the commission, with the net after tax amount of any payments, offsets, or other credits the recovery corporation actually receives from generators of electricity or other energy suppliers that would have reduced the unamortized balance of the recovery corporations regulatory asset created under the commissions Decision No. 03-12-035 but for the prior issuance of recovery bonds.SEC. 10.Section 848.7 is added to the Public Utilities Code, to read:848.7.(a)Notwithstanding subdivision (g) of Section 848.1, if, subsequent to the issuance of a financing order, a recovery corporation receives additional insurance proceeds, tax benefits, or other amounts that reimburse the recovery corporation for costs associated with 2017 northern California wildfire amounts included in the recovery costs addressed in that financing order, the recovery corporation shall credit customers, in a manner to be determined by the commission, with the net after tax amounts of those reimbursements, but the commission may not adjust, amend, or modify the 2017 northern California wildfire amounts, fixed recovery charges, the fixed recovery tax amounts, the financing order, recovery costs, the recovery property, or the recovery bonds.
(b)In the event the commission determines, in any proceeding, that any 2017 northern California wildfire amounts are to be disallowed as not just and reasonable, which may comprise only a portion of the 2017 northern California wildfire amounts, the commission shall direct the recovery corporation to credit customers for that disallowed amount in a manner determined by the commission, but the commission shall not adjust, amend, or modify the 2017 northern California wildfire amounts, fixed recovery charges, the fixed recovery tax amounts, the financing order, recovery costs, the recovery property, or the recovery bonds. Any such disallowance shall have no effect on any past or future determination of what amounts constitute 2017 northern California wildfire amounts or recovery costs under this article.
(c)Nothing in this section shall be construed to permit setoff, counterclaim, surcharge, recoupment, or defense by the recovery corporation or any other person, or in connection with the bankruptcy, reorganization, or other insolvency proceeding of the recovery corporation, any affiliate of the recovery corporation, or any other entity, against the recovery property, the fixed recovery charges, or the interests of an assignee, bondholder, or financing entity, or any pledgee in recovery property or fixed recovery charges.
SEC. 11.The Legislature finds and declares that a special statute is necessary and that a general statute cannot be made applicable within the meaning of Section 16 of Article IV of the California Constitution because of the unique circumstances applicable only to the Pacific Gas and Electric Company.
SEC. 12.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only 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.The Legislature finds and declares all of the following:(a)It is the policy of the state and the intent of the Legislature to encourage transportation electrification.(b)To reach the aggressive goals for reducing emissions of greenhouse gases to 40 percent below 1990 levels by 2030 and to 80 percent below 1990 levels by 2050, the entire state fleet, both public and private, will need to make a dramatic transition to vehicles that emit far less of greenhouse gases.(c)In 2012 the Governor issued an executive order directing the state government to help accelerate the market for zero-emission vehicles (ZEVs) calling for 1.5 million ZEVs in California by 2025. In November 2016, cumulative sales of ZEVs in California since 2010 were predicted to hit over 250,000. This is significantly less than the 1.5 million needed by 2025 in order to meet state goals.(d)The establishment of adequate infrastructure to support one million ZEVs by 2020 in anticipation of the 1.5 million ZEVs on California roads by 2025 is also significantly behind schedule.(e)These goals are stepping stones toward the greater 2050 goal of virtually all personal transportation in the state being based on ZEVs. More needs to be done to install electric vehicle infrastructure that will support and enable these critical zero-emission vehicle goals.(f)According to United States Census data, over 49 percent of Californias housing structures were built prior to 1960 and over 87 percent were built prior to 1980. Older homes and neighborhoods may require upgrades to electrical panels, lines, and transformers to accommodate the demand for charging electric vehicles.(g)Encouraging the growth of the secondary electric vehicle market could provide an opportunity to increase the use of electric vehicles in disadvantaged communities.SEC. 2.Section 740.16 is added to the Public Utilities Code, to read:740.16.(a)For purposes of this section, the following terms have the following meanings:(1)Electric vehicle means both battery electric and plug-in hybrid electric vehicles.(2)Grid-integrated rate means an electrical service rate design that reflects dynamic electrical grid conditions.(b)By March 30, 2018, in an existing proceeding, the commission, in consultation with the State Air Resources Board and the Energy Commission, shall consider authorizing electrical corporations to offer programs and investments that support customers who purchase used electric vehicles. If authorized by the commission, the programs and investments shall be designed to accelerate widespread transportation electrification, achieve ratepayer benefits, reduce dependence on petroleum, meet air quality standards, and reduce emissions of greenhouse gases. If authorized, the commission shall review, modify if appropriate, and decide whether to approve each proposal filed by an electrical corporation pursuant to this section within one year of the date of filing of the completed proposal.(c)Customers of an electrical corporation receiving access to an electric vehicle charging program pursuant to this section shall receive electrical service pursuant to a grid-integrated rate for charging their electric vehicles.(d)An electrical corporations electric vehicle charging program authorized by the commission pursuant to subdivision (b) shall include a reasonable mechanism for cost recovery by the electrical corporation.SEC. 3.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only 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.The Legislature finds and declares all of the following:
(a)It is the policy of the state and the intent of the Legislature to encourage transportation electrification.
(b)To reach the aggressive goals for reducing emissions of greenhouse gases to 40 percent below 1990 levels by 2030 and to 80 percent below 1990 levels by 2050, the entire state fleet, both public and private, will need to make a dramatic transition to vehicles that emit far less of greenhouse gases.
(c)In 2012 the Governor issued an executive order directing the state government to help accelerate the market for zero-emission vehicles (ZEVs) calling for 1.5 million ZEVs in California by 2025. In November 2016, cumulative sales of ZEVs in California since 2010 were predicted to hit over 250,000. This is significantly less than the 1.5 million needed by 2025 in order to meet state goals.
(d)The establishment of adequate infrastructure to support one million ZEVs by 2020 in anticipation of the 1.5 million ZEVs on California roads by 2025 is also significantly behind schedule.
(e)These goals are stepping stones toward the greater 2050 goal of virtually all personal transportation in the state being based on ZEVs. More needs to be done to install electric vehicle infrastructure that will support and enable these critical zero-emission vehicle goals.
(f)According to United States Census data, over 49 percent of Californias housing structures were built prior to 1960 and over 87 percent were built prior to 1980. Older homes and neighborhoods may require upgrades to electrical panels, lines, and transformers to accommodate the demand for charging electric vehicles.
(g)Encouraging the growth of the secondary electric vehicle market could provide an opportunity to increase the use of electric vehicles in disadvantaged communities.
SEC. 2.Section 740.16 is added to the Public Utilities Code, to read:740.16.(a)For purposes of this section, the following terms have the following meanings:
(1)Electric vehicle means both battery electric and plug-in hybrid electric vehicles.
(2)Electric vehicle service equipment means an electrical device allowing persons to safely charge an electric vehicle at not less than Level 2, including any needed electrical panel, line, and transformer upgrades. Electric vehicle service equipment may include direct current fast chargers that convert alternating current to direct current, bypass an electric vehicles onboard charging unit, and provide direct current directly to the vehicles batteries using a charging port.(3)(2)Grid-integrated rate means an electrical service rate design that reflects dynamic electrical grid conditions.
(4)Residential garage means a garage or carport attached to or reserved for a single detached dwelling or a single attached dwelling in a two- to four-unit residential building.(b)By March 30, 2018, in an existing proceeding, the commission, in consultation with the State Air Resources Board and the Energy Commission, shall consider authorizing electrical corporations to offer programs and investments in electric vehicle service equipment installed in residential garages of that support customers who purchase used electric vehicles. If authorized by the commission, the programs and investments shall be designed to accelerate widespread transportation electrification, achieve ratepayer benefits, reduce dependence on petroleum, meet air quality standards, and reduce emissions of greenhouse gases. If authorized, the commission shall decide, or modify and decide, review, modify if appropriate, and decide whether to approve each proposal filed by an electrical corporation pursuant to this section within six months one year of the date of filing of the completed proposal.
(c)Customers of an electrical corporation participating in a residential garage receiving access to an electric vehicle charging program pursuant to this section shall receive electrical service pursuant to a grid-integrated rate. rate for charging their electric vehicles.
(d)An electrical corporations residential garage electric vehicle charging program authorized by the commission pursuant to subdivision (b) shall include a reasonable mechanism for cost recovery by the electrical corporation.
SEC. 3.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only 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.
The Legislature finds and declares all of the following:
(a)It is the policy of the state and the intent of the Legislature to encourage transportation electrification.
(b)To reach the aggressive goals for reducing emissions of greenhouse gases to 40 percent below 1990 levels by 2030 and to 80 percent below 1990 levels by 2050, the entire state fleet, both public and private, will need to make a dramatic transition to vehicles that emit far less of greenhouse gases.
(c)In 2012 the Governor issued an executive order directing the state government to help accelerate the market for zero-emission vehicles (ZEVs) calling for 1.5 million ZEVs in California by 2025. In November 2016, cumulative sales of ZEVs in California since 2010 were predicted to hit over 250,000. This is significantly less than the 1.5 million needed by 2025 in order to meet state goals.
(d)The establishment of adequate infrastructure to support one million ZEVs by 2020 in anticipation of the 1.5 million ZEVs on California roads by 2025 is also significantly behind schedule.
(e)These goals are stepping stones toward the greater 2050 goal of virtually all personal transportation in the state being based on ZEVs. More needs to be done to install electric vehicle infrastructure that will support and enable these critical zero-emission vehicle goals.
(f)According to United States Census data, over 49 percent of Californias housing structures were built prior to 1960 and over 87 percent were built prior to 1980. Older homes and neighborhoods may require upgrades to electrical panels, lines, and transformers to accommodate the demand for charging electric vehicles.
(g)Encouraging the growth of the secondary electric vehicle market could provide an opportunity to increase the use of electric vehicles in disadvantaged communities.
SEC. 2.Section 740.16 is added to the Public Utilities Code, to read:740.16.(a)For purposes of this section, the following terms have the following meanings:
(1)Electric vehicle means both battery electric and plug-in hybrid electric vehicles.
(2)Electric vehicle service equipment means an electrical device allowing persons to safely charge an electric vehicle at not less than Level 2, including any needed electrical panel, line, and transformer upgrades. Electric vehicle service equipment may include direct current fast chargers that convert alternating current to direct current, bypass an electric vehicles onboard charging unit, and provide direct current directly to the vehicles batteries using a charging port.
(3)Grid-integrated rate means an electrical service rate design that reflects dynamic electrical grid conditions.
(4)Residential garage means a garage or carport attached to or reserved for a single detached dwelling or a single attached dwelling in a two- to four-unit residential building.
(b)By March 30, 2018, in an existing proceeding, the commission, in consultation with the State Air Resources Board and the Energy Commission, shall authorize consider authorizing electrical corporations to offer programs and investments in electric vehicle service equipment installed in residential garages of customers who purchase used electric vehicles. The If authorized by the commission, the programs and investments shall be designed to accelerate widespread transportation electrification, achieve ratepayer benefits, reduce dependence on petroleum, meet air quality standards, and reduce emissions of greenhouse gases. The If authorized, the commission shall approve, or modify and approve, decide, or modify and decide, whether to approve each proposal filed by an electrical corporation pursuant to this section within six months of the date of filing of the completed proposal.
(c)Customers of an electrical corporation participating in a residential garage electric vehicle charging program pursuant to this section shall receive electrical service pursuant to a grid-integrated rate.
(d)An electrical corporations residential garage electric vehicle charging program authorized by the commission pursuant to subdivision (b) shall include a reasonable mechanism for cost recovery by the electrical corporation.
(e)The commission shall ensure that all cost recovery by an electrical corporation pursuant to this section is nonbypassable and recoverable from all ratepayers.SEC. 3.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only 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.
The Legislature finds and declares all of the following:
(a)It is the policy of the state and the intent of the Legislature to encourage transportation electrification.
(b)To reach the aggressive goals for reducing emissions of greenhouse gases to 40 percent below 1990 levels by 2030 and to 80 percent below 1990 levels by 2050, the entire state fleet, both public and private, will need to make a dramatic transition to vehicles that emit far less of greenhouse gases.
(c)In 2012 the Governor issued an executive order directing the state government to help accelerate the market for zero-emission vehicles (ZEVs) calling for 1.5 million ZEVs in California by 2025. In November 2016, cumulative sales of ZEVs in California since 2010 were predicted to hit over 250,000. This is significantly less than the 1.5 million needed by 2025 in order to meet state goals.
(d)The establishment of adequate infrastructure to support one million ZEVs by 2020 in anticipation of the 1.5 million ZEVs on California roads by 2025 is also significantly behind schedule.
(e)These goals are stepping stones toward the greater 2050 goal of virtually all personal transportation in the state being based on ZEVs. More needs to be done to install electric vehicle infrastructure that will support and enable these critical zero-emission vehicle goals.
(f)According to United States Census data, over 49 percent of Californias housing structures were built prior to 1960 and over 87 percent were built prior to 1980. Older homes and neighborhoods may require upgrades to electrical panels, lines, and transformers to accommodate the demand for charging electric vehicles.
(g)Encouraging the growth of the secondary electric vehicle market could provide an opportunity to increase the use of electric vehicles in disadvantaged communities.
SEC. 2.Section 740.16 is added to the Public Utilities Code, to read:740.16.(a)For purposes of this section, the following terms have the following meanings:
(1)Electric vehicle means both battery electric and plug-in hybrid electric vehicles.
(2)Electric vehicle service equipment means an electrical device allowing persons to safely charge an electric vehicle at not less than Level 2, including any needed electrical panel, line, and transformer upgrades. Electric vehicle service equipment may include direct current fast chargers that convert alternating current to direct current, bypass an electric vehicles onboard charging unit, and provide direct current directly to the vehicles batteries using a charging port.
(3)Grid-integrated rate means an electrical service rate design that reflects dynamic electrical grid conditions.
(4)Residential garage means a garage or carport attached to or reserved for a single detached dwelling or a single attached dwelling in a two- to four-unit residential building.
(b)By March 30, 2018, the commission, in consultation with the State Air Resources Board and the Energy Commission, shall authorize electrical corporations to offer programs and investments in electric vehicle service equipment installed in residential garages of customers who purchase used electric vehicles. The programs and investments shall be designed to accelerate widespread transportation electrification, achieve ratepayer benefits, reduce dependence on petroleum, meet air quality standards, and reduce emissions of greenhouse gases. The commission shall approve, or modify and approve, each proposal filed by an electrical corporation pursuant to this section within six months of the date of filing of the completed proposal.
(c)Customers of an electrical corporation participating in a residential garage electric vehicle charging program pursuant to this section shall receive electrical service pursuant to a grid-integrated rate.
(d)An electrical corporations residential garage electric vehicle charging program authorized by the commission pursuant to subdivision (b) shall include a reasonable mechanism for cost recovery by the electrical corporation.
(e)The commission shall ensure that all cost recovery by an electrical corporation pursuant to this section is nonbypassable and recoverable from all ratepayers.
SEC. 3.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only 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.The Legislature finds and declares all of the following:(a)To achieve the goal of reducing greenhouse gas emissions to 40 percent of 1990 levels by 2030, it is critical to increase the sales of vehicles that are low emitters of net greenhouse gases. Current programs to subsidize the sale of low net emitters of greenhouse gases will not provide adequate funding to increase the sale of these vehicles. Any program to do so should improve social equity by reducing the cost of vehicles for low-income buyers.(b)The cost to taxpayers of providing incentives for zero-emission vehicles will become increasingly burdensome as sales of plug-in and fuel cell electric vehicles increase. Currently, California rebates approximately $2,500 for each battery electric vehicle sold, $1,500 for a plug-in hybrid vehicle, and $5,000 for a fuel cell electric vehicle. If, for example, one-quarter of annual vehicle sales are electric vehicles (500,000 out of roughly 2 million annual vehicle sales), the annual cost to California would be $1.25 billion ($2,500 x 500,000).(c)Markets and regulations are getting out of alignment in the sense that vehicle fuel economy and greenhouse gas standards are getting more stringent even as gasoline prices are low. The result is consumers are becoming increasingly resistant to buying the vehicles that regulations require be sold. As vehicle fuel and greenhouse gas standards get more stringent, the misalignment will worsen.(d)Programs need to be created to encourage the purchase of vehicles that are low emitters of greenhouse gas. One approach would be to design a program that would charge a fee to vehicle buyers of high emitters of net greenhouse gases and provide rebates to vehicle buyers of low emitters of net greenhouse gases. The goal is to design the schedule of fees and rebates, referred to as Feebates, to be revenue neutral, meaning the fees impose no burden on taxpayers or any government program.(e)A program that would charge fees for the purchase of new vehicles that are the highest emitters of net greenhouse gases and give a rebate on the purchase of new vehicles that are the lowest emitters of net greenhouse gases may benefit low-income buyers because they tend to buy smaller, lower emitting vehicles.SEC. 2.It is the intent of the Legislature to enact legislation to reduce net emissions from greenhouse gases from transportation by imposing fees and granting rebates on sales of new automobiles and light trucks.The Legislature finds and declares all of the following:
(a)To achieve the goal of reducing greenhouse gas emissions to 40 percent of 1990 levels by 2030, it is critical to increase the sales of vehicles that are low emitters of net greenhouse gases. Current programs to subsidize the sale of low net emitters of greenhouse gases will not provide adequate funding to increase the sale of these vehicles. Any program to do so should improve social equity by reducing the cost of vehicles for low-income buyers.
(b)The cost to taxpayers of providing incentives for zero-emission vehicles will become increasingly burdensome as sales of plug-in and fuel cell electric vehicles increase. Currently, California rebates approximately $2,500 for each battery electric vehicle sold, $1,500 for a plug-in hybrid vehicle, and $5,000 for a fuel cell electric vehicle. If, for example, one-quarter of annual vehicle sales are electric vehicles (500,000 out of roughly 2 million annual vehicle sales), the annual cost to California would be $1.25 billion ($2,500 x 500,000).
(c)Markets and regulations are getting out of alignment in the sense that vehicle fuel economy and greenhouse gas standards are getting more stringent even as gasoline prices are low. The result is consumers are becoming increasingly resistant to buying the vehicles that regulations require be sold. As vehicle fuel and greenhouse gas standards get more stringent, the misalignment will worsen.
(d)Programs need to be created to encourage the purchase of vehicles that are low emitters of greenhouse gas. One approach would be to design a program that would charge a fee to vehicle buyers of high emitters of net greenhouse gases and provide rebates to vehicle buyers of low emitters of net greenhouse gases. The goal is to design the schedule of fees and rebates, referred to as Feebates, to be revenue neutral, meaning the fees impose no burden on taxpayers or any government program.
(e)A program that would charge fees for the purchase of new vehicles that are the highest emitters of net greenhouse gases and give a rebate on the purchase of new vehicles that are the lowest emitters of net greenhouse gases may benefit low-income buyers because they tend to buy smaller, lower emitting vehicles.
SEC. 2.It is the intent of the Legislature to enact legislation to reduce net emissions from greenhouse gases from transportation by imposing fees and granting rebates on sales of new automobiles and light trucks.
|
Date
|
Status
|
|---|---|
| Jul 5, 2018 | 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. |
| Jul 3, 2017 | In committee: Set, first hearing. Hearing canceled at the request of author. |
| Jun 22, 2017 | 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 14, 2017 | Referred to Coms. on E., U. & C. and EQ. |
| Jun 1, 2017 | In Senate. Read first time. To Com. on RLS. for assignment. |
| May 31, 2017 | Read third time. Passed. Ordered to the Senate. (Ayes 58. Noes 17. Page 1948.) |
| May 30, 2017 | Read second time and amended. Ordered returned to second reading. |
| May 26, 2017 | From committee: Amend, and do pass as amended. (Ayes 12. Noes 4.) (May 26). |
| May 17, 2017 | In committee: Set, first hearing. Referred to APPR. suspense file. |
| Apr 27, 2017 | From committee: Do pass and re-refer to Com. on APPR. (Ayes 10. Noes 2.) (April 26). Re-referred to Com. on APPR. |
| Mar 27, 2017 | Re-referred to Com. on C. & C. |
| Mar 23, 2017 | From committee chair, with author's amendments: Amend, and re-refer to Com. on C. & C. Read second time and amended. |
| Mar 23, 2017 | Referred to Com. on C. & C. |
| Dec 6, 2016 | From printer. May be heard in committee January 5. |
| Dec 5, 2016 | Read first time. To print. |
|
Date
|
Description
|
Location
|
Votes
|
|
|---|---|---|---|---|
| May 31, 2017 | AB 33 QUIRK Assembly Third Reading | Assembly Floor |
Passed |
|
| May 26, 2017 | Do pass as amended. | Assembly Standing Committee on Appropriations |
Passed |
|
| Apr 26, 2017 | Do pass and be re-referred to the Committee on [Appropriations] | Assembly Standing Committee on Communications and Conveyance |
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
|
|---|---|---|
| Napa Valley Clean Air Now | * Support | Apr 26, 2017 |
| NextGen California | * Support | Apr 26, 2017 |
| San Diego Gas & Electric | ** Support | Jun 30, 2017 |
| The Utility Reform Network | ** Against | Jun 30, 2017 |
SENATE COMMITTEE ON ENERGY, UTILITIES AND COMMUNICATIONS
Senator Ben Hueso, Chair
2017 - 2018 Regular
Bill No: AB 33 Hearing Date: 7/3/2017
Author: | Quirk | ||
Version: | 6/22/2017 As Amended | ||
Urgency: | No | Fiscal: | Yes |
Consultant: | Nidia Bautista | ||
SUBJECT: Transportation electrification: electric vehicle service equipment: electrical corporations: rates
DIGEST: This bill would require the California Public Utilities Commission (CPUC), by March 30, 2018, in consultation with the California Air Resources Board (CARB), and the California Energy Commission (CEC), to consider authorizing electrical corporations to offer programs and investments that support customers who purchase a used electric vehicle and provide those customers with a grid-integrated electricity rate.
ANALYSIS:
Existing law:
- Establishes the CPUC with regulatory authority over public utilities, including electrical corporations and gas corporations. (Public Utilities Code §216)
- Requires the CPUC, in consultation with the CEC, CARB, electrical corporations, and the motor vehicle industry, to evaluate policies to develop infrastructure sufficient to overcome any barriers to the widespread deployment and use of plug-in hybrid and electric vehicles and, by July 1, 2011, to adopt rules that address specified issues. (Public Utilities Code §740.2)
- Requires the CPUC, in cooperation with the CEC, CARB, air quality management districts and air pollution control districts, electrical and gas corporations, and the motor vehicle industry, to evaluate and implement policies to promote the development of equipment and infrastructure needed to facilitate the use of electric power and natural gas to fuel low-emission vehicles. (Public Utilities Code §740.3)
- Requires the CPUC, in consultation with the CEC, and CARB, to direct electrical corporations to file applications for programs and investments to accelerate widespread transportation electrification to reduce dependence on petroleum, meet air quality standards, achieve the goals set forth in the Charge Ahead California Initiative, and reduce emissions of greenhouse gases to 40 percent below 1990 levels by 2030 and to 80 percent below 1990 levels by 2050.
- Requires the CPUC to approve, or modify and approve, programs and investments that deploy charging infrastructure, through a reasonable cost recovery mechanism, if they are consistent with purposes of the this section, do not unfairly compete with nonutility enterprises, include performance accountability measures, and are in the interests of ratepayers. (Public Utilities Code §740.12)
- Defines “interests” of ratepayers in Public Utilities Code Sections 740.3 and 740.12 to mean direct benefits that are specific to ratepayers, consistent with both safer and more reliable service or less costly gas or electrical service including due to either improved use of the electric system or improved integration of renewable energy generation and any one five other benefits, as specified. (Public Utilities Code §740.8)
- Requires the CPUC to establish rates using cost allocation principles that fairly and reasonably assign to different customer classes the costs of providing service to those customer classes, consistent with the policies of affordability and conservation. (Public Utilities Code §739.6)
This bill:
- Finds and declares it is the policy of the state and intent of the Legislature to encourage transportation electrification, that in order to reach the state’s greenhouse gas (GHG) emissions goals the entire state motor vehicle fleet will need to make a dramatic transition to the transportation electrification, that more needs to be done to install electric vehicle infrastructure that will support and enable the state’s goals related to deployment of zero-emission vehicles (ZEVs) and that encouraging the growth of the secondary electric vehicle market could provide an opportunity to increase the use of electric vehicles in disadvantaged communities.
- Defines “electric vehicle” to mean both battery electric and plug-in hybrid electric vehicles (PHEVs).
- Defines “grid-integrated rate” to mean an electrical service rate design that reflects dynamic electrical grid conditions.
- Requires, by March 30, 2018, in an existing proceeding, the CPUC, in consultation with CARB and CEC to consider authorizing electrical corporations to offer programs and investments that support customers who purchase used electric vehicles.
- Requires the programs and investments, if authorized by the CPUC, to be designed to accelerate widespread transportation electrification, achieve ratepayer benefits, reduce dependence on petroleum, meet air quality standards, and reduce emissions of GHG.
- Requires the CPUC, if the programs are authorized by the CPUC, to review, modify if appropriate, and decide whether to approve each proposal filed by an electrical corporation within one year of the date of filing of the completed proposal.
- Requires customers who receive access to an electric vehicle charging program per this bill to receive electrical service pursuant to a grid-integrated rate for charging their electric vehicles.
- Requires an electrical corporation’s electric vehicle charging program authorized by the CPUC to include a reasonable mechanism for cost recovery by the electrical corporation.
Background
Transportation emissions represent approximately 37 percent of the state’s GHG emissions, 83 percent of its oxides of nitrogen (NOx) emissions, and 95 percent of its diesel emissions. AB 32 (Nunez, Chapters 488, Statutes of 2006), required CARB to adopt rules and regulations that reduce GHG emissions in the state to 1990 levels by 2020. CARB estimates that by mid-century, 87 percent of cars on the road will need to be full ZEVs, putting California on the path to reducing GHG emission by 80 percent by 2050.
In 2012, Governor Brown signed Executive Order B-16-12 which directed CPUC and other state agencies to help accelerate the market for ZEVs to support the adoption of 1.5 million ZEVs on California roads by 2025 and the integration of plug-in electric vehicle charging into the state's electricity grid by 2020.
Barriers to ZEV Adoption: Since 2012, California's ZEV market has grown significantly through the expansion of rebates and incentives. The average California drives less than 40 miles per day, well within the range of available ZEV models. Because ZEVs require longer charge times, range anxiety caused by the lack of infrastructure continues to impede the adoption of ZEVs in rural areas or for drivers seeking to make longer trips.
As battery and charging technology continue to advance, greater access to charging infrastructure will promote greater adoption of ZEVs. Locating ZEVs in areas where drivers park for long durations, can help mitigate some concerns associated with ZEV adoption. The development of level 2 chargers can now allow drivers to charge ZEVs from 12 to 20 miles per hour. The continue development of faster chargers combined with grid-integrated rates, can provide drivers with more flexibility in determining when to charge their vehicles, and at times that best support conditions of the state's electricity grid throughout the day.
This bill requires CPUC, in consultation with CARB and CEC, to consider authorizing the investor-owned utilities (IOUs) to offer programs and investments in electric vehicle service equipment installed to support charging by customers who purchase used electric vehicles, as specified.
Impacts to the Electric Grid. While the electrification of our transportation system is a policy that the state is actively pursuing, it’s important to acknowledge that the increased use of plug in electric vehicles will result in greater load and demands of the electric grid. If electric vehicles are charged at peak times, then each one added to a neighborhood is about the equivalent of an additional household worth of load added to that neighborhood. Such increases in electric demand could require distribution upgrades, as well as additional stress on distribution equipment, and the construction of additional generation capacity. Achieving the governor’s target with an equal number of battery electric vehicles and plug-in hybrid electric vehicles (PHEV) would represent an additional load of 7,000 megawatts on the grid, roughly 16 percent of the summer peak load. On the other hand, if electric vehicles owners can be induced to charge during off-peak times, then the stress and risk on the distribution system will be much less. The encouraging news for now is that most electric vehicle owners are charging at night, due to pricing signals, driving patterns and work schedules[1]. Time variant pricing may also help, although it will remain to be seen how effective such efforts, with increased proliferation of electric vehicles, would be during daytimes when most people may not have the vehicle charging on their own property and therefore, they may have less control to account for the changing price signals.
CPUC Electric Vehicle Charging Activity. SB 350 orders the CPUC to direct the six IOUs in the state to file Applications for programs that “accelerate widespread transportation electrification.” These programs are required to reduce dependence on petroleum, increase the adoption of ZEVs, help meet air quality standards, and reduce GHG emissions. The three largest IOUs have over $1 billion in electric vehicle charging proposals pending review and approval by the CPUC. These are in addition to their roughly $200 million in previously approved electric vehicle charging pilots.
Used Vehicles. This bill proposes to support the widespread use of electric vehicles by supporting the secondary electric vehicle market. It’s possible the primary electric vehicle market is too nascent to justify support for efforts in the used electric vehicle market. However, this bill appropriately authorizes the CPUC to consider as part of the existing electric vehicle infrastructure proceedings under its review, while not requiring the CPUC to adopt. Assuming the primary electric vehicle market expands in line with the state’s ZEV goals, it’s more than likely just a matter of timing when some attention to the used vehicle market will be necessary to ensure electric vehicle deployment is accessible to more Californians. While the language in most of this bill refers to electrical vehicle charging, the author and committee may wish to ensure the language in section 2(b) explicitly states “to offer electric vehicle charging programs and investments,” as ratepayers should not be funding rebates for purchasing the used electric vehicles.
Effects on Ratepayers. By authorizing the CPUC to include charging for used vehicles within the consideration of the IOUs current proposals, the new infrastructure, if approved, risks the potential for stranded and/or under- or un-utilized assets. However, this bill appropriately authorizes the CPUC to consider, but not require it to adopt, programs that support secondary used electric vehicles. This bill also incorporates much of the same language from SB 350 (De León, Chapter 547, Statutes of 2015) that guided CPUC adoption of electric vehicle charging infrastructure, including ensuring the programs are designed to achieve ratepayer benefits.
Double Referral. Should this bill be approved by this committee, it will be re-referred to the Senate Committee on Environmental Quality for its consideration.
Prior/Related Legislation
AB 1082 (Burke, 2017) requires an electrical corporation to file with, and the CPUC to approve, a program proposal for the installation of electric charging stations at school facilities. The bill is pending consideration before this committee.
AB 1083 (Burke, 2017) requires an electrical corporation to file with, and the CPUC to approve, a program proposal for the installation of electric charging stations at state parks and beaches. The bill is pending consideration before this committee.
SB 350 (De León, Chapter 547, Statutes of 2015) among the many provisions of the bill included provisions related to supporting electrification of the transportation system and established requirements of the CPUC in adopting electric vehicle charging proposals from the electric utilities.
FISCAL EFFECT: Appropriation: No Fiscal Com.: Yes Local: Yes
SUPPORT:
San Diego Gas & Electric
OPPOSITION:
The Utility Reform Network
ARGUMENTS IN SUPPORT: According to the author:
AB 33 will require the CPUC in consultation with CARB and CEC to consider allowing utilities to offer programs to help consumers with the purchase of electric vehicle charging stations when purchasing a used electric vehicle. These programs could accelerate widespread use of electric vehicles, reduce dependence on petroleum and reduce GHG emissions.
ARGUMENTS IN OPPOSITION: The Utility Reform Network (TURN), in their opposition to this bill, express support for electric vehicle adoption, however, they have concerns that basic affordable electric service will be out of reach of low and middle-income Californians. Furthermore, TURN anticipates the impact on ratepayers of the over billion dollars in electric vehicle charging project investments already in the process of enrollment and approval by the CPUC. As ratepayers will shoulder significant costs for investments in transportation electrification, TURN urges the Legislature to consider alternative funding mechanisms for any new proposals, including state funds. TURN also has specific concerns with the inclusion of PHEV within the definition of electric vehicle in this bill.
-- END --
Vehicle Grid Integration: A Vision for Zero-Emission Transportation Interconnected throughout California’s Electricity System. CPUC Energy Division. March 2014. ↑
ASSEMBLY THIRD READING
ATR Bill Id:AB 33
Author:(Quirk)
As Amended Ver:May 30, 2017
Majority vote
Committee | Votes | Ayes | Noes |
Communications | 10-2 | Santiago, Cervantes, Dababneh, Eduardo Garcia, Holden, Lackey, Low, Maienschein, Rodriguez, Wood | Obernolte, Patterson |
Appropriations | 12-4 | Gonzalez Fletcher, Bloom, Bocanegra, Bonta, Calderon, McCarty, Quirk, Friedman, Eduardo Garcia, Gray, Muratsuchi, Reyes | Bigelow, Fong, Gallagher, Obernolte |
SUMMARY: Requires the California Public Utilities Commission (CPUC), in consultation with the California Air Resources Board (CARB) and the California Energy Commission (CEC) to consider authorizing electrical corporations to offer programs and investments in electric vehicle service equipment installed in residential garages. Specifically, this bill:
- Requires CPUC, in an existing proceeding, in consultation with CARB and CEC, to consider authorizing electrical corporations to offer programs and investments in electric vehicle service equipment installed in residential garages of customers who purchase used electric vehicles, by March 30, 2018, as specified.
- Requires, if authorized, CPUC to decide, or modify and decide, whether to approve each specified proposal filed by an electrical corporation within six months of the date of filing of the completed proposal.
- Defines "electric vehicle" to mean both battery electric and plug-in hybrid electric vehicles.
- Defines "electric vehicle service equipment" to mean an electrical device allowing persons to safely charge an electric vehicle at not less than Level 2, including any needed electrical panel, line, and transformer upgrades, and may include direct current fast chargers that convert alternating current to direct current, bypass an electric vehicle's onboard charging unit, and provide direct current directly to the vehicle's batteries using a charging port.
- Defines "grid-integrated rate" to mean an electrical service rate design that reflects dynamic electrical grid conditions.
- Defines "residential garage" to mean a garage or carport attached to or reserved for a single detached dwelling or a single attached dwelling in a two- to four-unit residential building.
- Requires customers of an electrical corporation participating in a specified residential garage electric vehicle charging program to receive electrical service pursuant to a grid-integrated rate.
- Requires an electrical corporation's specified residential garage electric vehicle charging program authorized by CPUC to include a reasonable mechanism for cost recovery by the electrical corporation.
FISCAL EFFECT: According to the Assembly Appropriations Committee, this bill would have minor and absorbable CARB and CEC costs for consultation.
COMMENTS:
- Authors Statement: According to the author, "California has set a goal to have sufficient charging infrastructure available to support 1 million [Zero Emission Vehicles] (ZEVs) by 2020 […] the secondary ZEV market can help increase the number of ZEVs on California roads. The secondary market could attract new drivers that are unable to afford the new car market. The cost of purchasing and installing a level 2 charger can be prohibitive when it is added to the initial purchase of a ZEV. Installation costs vary based on the age of the home, and the location, distance, proximity of the electric panel to the proposed electric vehicle supply equipment location as well as the size and load on the existing panel […] AB 33 would require the [CPUC] to authorize [investor owned utilities] (IOUs) to offer level 2 electric vehicle chargers. The bill targets drivers who purchase their ZEV on the secondary market because encouragement of the growth of the secondary ZEV market will provide an opportunity to increase adoption in disadvantaged communities and low-income drivers."
- Background: AB 32 (Nunez) Chaptered 488, Statutes of 2006, required CARB to adopt rules and regulations that would reduce greenhouse gas (GHG) emissions in the state to 1990 levels by 2020. Transportation emissions represent approximately 37% of the states GHG emission, 83% of its NOx emissions, and 95% of its diesel emissions. In implementing AB 32, CARB found that efficient, ZEVs using low carbon fuels are a vital component of the state's effort to reach its GHG emission reduction goals. CARB estimates that by mid-century, 87% of cars on the road will need to be full ZEVs, putting California on the path to reducing GHG emission by 80% by 2050.
In 2012, Governor Brown signed Executive Order B-16-12 which directed CPUC and other state agencies to help accelerate the market for ZEVs to support the adoption of 1.5 million ZEVs on California roads by 2025 and the integration of plug-in electric vehicle charging into the state's electricity grid by 2020.
- Barriers to ZEV Adoption: Since 2012, California's ZEV market has grown significantly through the expansion of rebates and incentives. The average California drives less than 40 miles per day, well within the range of available ZEV models. Because ZEVs require longer charge times, range anxiety caused by the lack of infrastructure continues to impede the adoption of ZEVs in rural areas or for drivers seeking to make longer trips.
As battery and charging technology continue to advance, greater access to charging infrastructure will promote greater adoption of ZEVs. Locating ZEVs in areas where drivers park for long durations, can help mitigate some concerns associated with ZEV adoption. The development of level 2 chargers can now allow drivers to charge ZEVs from 12 to 20 miles per hour. The continue development of faster chargers combined with grid-integrated rates, can provide drivers with more flexibility in determining when to charge their vehicles, and at times that best support conditions of the state's electricity grid throughout the day. .
This bill requires CPUC, in consultation with CARB and CEC, to consider authorizing the IOUs to offer programs and investments in electric vehicle service equipment installed in residential garages of customers who purchase used electric vehicles, as specified.
Analysis Prepared by: Edmond Cheung / C. & C. / (916) 319-2637 FN: 0000756
Date of Hearing: May 17, 2017
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez Fletcher, Chair
ABPCA Bill Id:AB 33
Author:(Quirk) – As Amended Ver:March 23, 2017
Policy Committee: | Communications and Conveyance | Vote: | 10 - 2 |
|
| ||
|
|
Urgency: No State Mandated Local Program: Yes Reimbursable: No
SUMMARY:
This bill requires the California Public Utilities Commission (PUC), in consultation with the California Air Resources Board (ARB) and the California Energy Commission (CEC), to authorize electrical corporations to offer programs and investments in electric vehicle service equipment installed in residential garages by March 30, 2018. Specifically, this bill:
- Requires the PUC to approve, or modify and approve, each specified proposal filed by an electrical corporation within six months of the date of filing the completed proposal.
- Requires customers participating in a specified residential garage electric vehicle charging program (Program) to receive electrical service pursuant to a grid-integrated rate.
- Requires the Program to include a reasonable mechanism for cost recovery by the electrical corporation.
- Requires the PUC to ensure that all the specified cost recovery by an electrical corporation is nonbypassable and recoverable from all ratepayers.
FISCAL EFFECT:
- Ongoing annual increased PUC costs of approximately $440,000 (Utilities Reimbursement Account) to review and approve applications within the six month period.
- Minor and absorbable ARB and CEC costs for consultation.
COMMENTS:
- Purpose. According to United State Census data, over 49% of California housing structures were build prior to 1960 and 87% were build prior 1980. Older homes and neighborhoods may require upgrades to electrical panels, lines, and transformers to accommodate the demand for charging electric vehicles.
According to the author, this bill, targets drivers who purchase their zero-emission vehicles (ZEVs) on the secondary market because encouragement of the growth of the secondary ZEV market will provide an opportunity to increase adoption in disadvantaged communities and low-income drivers.
- Background. AB 32 (Nunez) Chaptered 488, Statutes of 2006, requires ARB to adopt rules and regulations that would reduce greenhouse gas (GHG) emissions to 1990 levels by 2020. Transportation emissions represent approximately 37% of the states GHG emission, 83% of its NOx emissions, and 95% of diesel emissions. In implementing AB 32, ARB found that efficient, ZEVs using low carbon fuels are a vital component of the state’s effort to reach its GHG emission reduction goals. ARB estimates that by mid-century, 87% of cars on the road will need to be full ZEVs, putting California on the path to reducing GHG emission by 80% by 2050.
In 2012, Governor Brown signed Executive Order B-16-12 which directed the PUC and other state agencies to help accelerate the market for ZEVs to support the adoption of 1.5 million ZEVs on California roads by 2025 and the integration of plug-in electric vehicle charging into the state’s electricity grid by 2020.
- Barriers to ZEV adoption. The average Californian drives less than 40 miles per day, well within the range of available ZEV models. However, because ZEVs require longer charge times, the lack of infrastructure impedes the adoption of ZEVs in rural areas or for drivers seeking to make longer trips.
As battery and charging technology continue to advance, greater access to charging infrastructure will promote greater adoption of ZEVs. Locating ZEVs in areas where drivers park for long durations, such as resident garages, mitigates some concerns associated with ZEV adoption. The development of level 2 chargers (supplies 240 volts) can now allow drivers to charge ZEVs from 12 to 20 miles per hour. The continued development of faster chargers combined with grid-integrated rates, can provide drivers with more flexibility in determining when to charge their vehicles, and at times that best support conditions of the state’s electricity grid throughout the day.
- Related Legislation. There are currently ten bills pending before this Committee, including this bill, to provide clean vehicle incentives as follows:
AB 33 (Quirk) requires the California Public Utilities Commission (PUC) by March 30, 2018, to authorize IOUs to offer programs and investments in residential electric vehicle service equipment. AB 33 requires rates to be given at a grid-integrated rate levels.
AB 188 (Salas) requires ARB to update the Enhanced Fleet Modernization Program (EFMP) guidelines to allow participants to replace their vehicle with light-duty trucks so long as they are retiring a pickup truck and the replacement truck meets the fuel efficiency standards for minivans.
AB 193 (Cervantes) establishes a Clean Vehicle Rebate Program (CVRP) program for used vehicles. Incentives may also be used for the replacement or refurbishment of a battery or an extended service warranty to cover repair costs associated with “unique problems” in eligible used vehicles. Eligibility is restricted to low- and moderate-income customers in disadvantaged communities and who live in either a nonattainment air basin or has received minimal amounts from the CVRP program in the past.
AB 544 (Bloom) creates a new program (upon expiration of the existing program) to allow super ultra-low emission vehicles and transitional zero-emission vehicles access to high-occupancy vehicle lanes for an approximately four-year period, regardless of vehicle occupancy level.
AB 964 (Gomez) creates the California Affordable Clean Vehicle Program (loan guarantee program) at the California Pollution Control Financing Authority to assist low-income or high risk individuals in the purchase of low-emission vehicles.
AB 1081 (Burke) provides a sales tax exemption for the value of a vehicle traded in to purchase a clean vehicle.
AB 1082 (Burke) requires investor-owned utilities (IOUs) to develop a program for the installation of vehicle charging stations at school facilities for the use by faculty, students, and parents. Electricity will be provided at time-of-use rates.
AB 1083 (Burke) requires investor-owned utilities (IOUs) to create a charging network at all state parks and beaches by July 31, 2018. Electricity will be provided at time-of-use rates.
AB 1259 (Calderon) creates a Capital Access Loan Program at the Pollution Control Financing Authority to assist low- and middle-income families with the purchase or lease of electric vehicles.
AB 1341 (Calderon) excludes up to $40,000 from state sales tax on the purchase of used near-zero emission or zero-emission vehicles for low-income purchasers. Allows a personal income tax credit (ranging $1,500-$5,000) for the purchase of certain plug-in hybrid vehicles and all battery electric and hydrogen fuel cell vehicles, with an additional $500 credit allowed for low-income purchasers. The tax credit may be assigned to a financing entity.
Analysis Prepared by: Jennifer Galehouse / APPR. / (916) 319-2081
Date of Hearing: April 26, 2017
ASSEMBLY COMMITTEE ON COMMUNICATIONS AND CONVEYANCE
Miguel Santiago, Chair
ABPCA Bill Id:AB 33 (
Author:Quirk) – As Amended Ver:March 23, 2017
SUBJECT: Transportation electrification: electric vehicle service equipment: electrical corporations: rates
SUMMARY: Requires the California Public Utilities Commission (CPUC), in consultation with the California Air Resources Board (CARB) and the California Energy Commission (CEC) to authorize electrical corporations to offer programs and investments in electric vehicle service equipment installed in residential garages. Specifically, this bill:
- Requires the CPUC, in consultation with CARB and the CEC, to authorize electrical corporations to offer programs and investments in electric vehicle service equipment installed in residential garages of customers who purchase used electric vehicles, by March 30, 2018.
- Requires the CPUC to approve, or modify and approve, each specified proposal filed by an electrical corporation within six months of the date of filing of the completed proposal.
- Defines “electric vehicle” to mean both battery electric and plug-in hybrid electric vehicles.
- Defines “electric vehicle service equipment” to mean an electrical device allowing persons to safely charge an electric vehicle at not less than Level 2, including any needed electrical panel, line, and transformer upgrades, and may include direct current fast chargers that convert alternating current to direct current, bypass an electric vehicle’s onboard charging unit, and provide direct current directly to the vehicle’s batteries using a charging port.
- Defines “grid-integrated rate” to mean an electrical service rate design that reflects dynamic electrical grid conditions.
- Defines “residential garage” to mean a garage or carport attached to or reserved for a single detached dwelling or a single attached dwelling in a two- to four-unit residential building.
- Requires customers of an electrical corporation participating in a specified residential garage electric vehicle charging program to receive electrical service pursuant to a grid-integrated rate.
- Requires an electrical corporation’s specified residential garage electric vehicle charging program authorized by the CPUC to include a reasonable mechanism for cost recovery by the electrical corporation.
- Requires the CPUC to ensure that all the specified cost recovery by an electrical corporation is nonbypassable and recoverable from all ratepayers.
EXISTING LAW:
- Requires CARB to adopt rules and regulations that would reduce the states greenhouse gas (GHG) emission levels to 1990 levels by 2020. (Health and Safety Code (HSC) Section 38500 et seq.)
- Establishes the California Renewables Portfolio Standard Program which requires retail sellers of electricity to procure 33 percent of retails sales of electricity, by 2013, and 50 percent by 2030, from eligible renewable energy resources. (Public Utilities Code (PUC) Section 399.11, et seq.)
- Requires each electrical corporation to propose a cost recovery plan to the CPUC for the recovery of the uneconomic costs of an electrical corporation’s generation-related assets and obligations, as specified. (PUC Section 368)
- Requires the CPUC to establish rates using cost allocation principles that fairly and reasonably assign to different customer classes the costs of providing service to those customer classes, consistent with the policies of affordability and conservation. (PUC Section 739.6)
- Provides CARB with primary responsibility for control of mobile source air pollution, including adoption of rules for reducing vehicle emissions and the specification of vehicular fuel composition. (HSC Section 39000, et seq., and Section 39500, et seq.)
- Requires CARB to adopt and implement motor vehicle emission standards, in-use performance standards, and motor vehicle fuel specifications for the control of air contaminants and sources of air pollution which CARB has found to be necessary, cost effective, and technologically feasible, to carry out specified purposes. (HSC Section 43013, et seq.)
- Requires CARB, in consultation with CPUC and with input from relevant state agencies and the public, to develop and publish a study on barriers for low-income customers to zero-emission and near-zero-emission transportation options, including those in disadvantaged communities, as well as recommendations on how to increase access to zero-emission and near-zero-emission transportation options to low-income customers, including those in disadvantaged communities, by January 1, 2017. (Public Resources Code Section 25327)
FISCAL EFFECT: Unknown. This bill is keyed fiscal by the Legislative Counsel.
COMMENTS:
- Authors Statement: According to the author, “California has set a goal to have sufficient charging infrastructure available to support 1 million [Zero Emission Vehicles] (ZEVs) by 2020 […] the secondary ZEV market can help increase the number of ZEVs on California roads. The secondary market could attract new drivers that are unable to afford the new car market. The cost of purchasing and installing a level 2 charger can be prohibitive when it is added to the initial purchase of a ZEV. Installation costs vary based on the age of the home, and the location, distance, proximity of the electric panel to the proposed electric vehicle supply equipment location as well as the size and load on the existing panel […] AB 33 would require the [CPUC] to authorize [investor owned utilities] (IOUs) to offer level 2 electric vehicle chargers. The bill targets drivers who purchase their ZEV on the secondary market because encouragement of the growth of the secondary ZEV market will provide an opportunity to increase adoption in disadvantaged communities and low-income drivers.”
- Background: ZEVs run on electricity stored in batteries instead of fossil fuels, such as pure battery plug-in electric vehicles, plug in hybrid vehicles and hydrogen fuel cell electric vehicles. In 2006, the Legislature enacted AB 32 (Nunez) Chaptered 488, Statutes of 2006, which required CARB to adopt rules and regulations that would reduce GHG emissions in the state to 1990 levels by 2020. In addition, in 2015, the Legislature enacted SB 350 (De Leon) Chapter 547, Statutes of 2015, which established new energy efficiency and renewable electricity targets to support the state’s climate goals. Transportation emissions represent approximately 37 percent of the states GHG emission, 83 percent of its NOx emissions, and 95 percent of its diesel emissions. In implementing AB 32, CARB found that efficient, ZEVs using low carbon fuels are a vital component of the state’s effort to reach its GHG emission reduction goals. CARB estimates that by mid-century, 87% of cars on the road will need to be full ZEVs, putting California on the path to reducing GHG emission by 80% by 2050.
- California’s ZEV Action Plan: In 2012, Governor Brown signed Executive Order B-16-12 which directed the CPUC and other state agencies to help accelerate the market for ZEVs to support the adoption of 1.5 million ZEVs on California roads by 2025 and the integration of plug-in electric vehicle charging into the state’s electricity grid by 2020. As of the summer of 2016, Californians drive 47% of all ZEVs on the road in the United States with Los Angeles and Santa Clara County being the largest ZEV metropolitan adoption regions in the state. In October 2016, the Governor’s Interagency Working Group on ZEVs released its 2016 ZEV Action Plan, which provides an updated roadmap towards reaching the states ZEV goals. The plan highlighted certain priorities for ZEV development and adoption including, raising consumer awareness and education about ZEVs; ensuring ZEVs are accessible to a broad range of Californians, making ZEV technologies commercially viable in targeted sectors, and aiding ZEV market growth beyond California.
- Investments in ZEV Infrastructure: Since 2012, California’s ZEV market has grown significantly through the expansion of rebates and incentives. California’s three IOUs provide rebates to plug-in electric vehicle drivers, including Pacific Gas & Electric’s Clean Fuel Rebate, San Diego Gas & Electric’s (SDG&E) Electric Vehicle Climate Credit, and Southern California Edison’s Clean Fuel Rewards. Customers who purchase electric vehicles may also be eligible for rebates through the states Clean Vehicle Rebate Project which has issued nearly $350 million in rebates since 2009. In addition, the IOUs are currently implementing pilot programs to install 12,500 electric vehicle charging stations in multi-unit dwellings, workplaces, and public interest destinations at a cost of $197 million, with a certain number of charging stations designated in disadvantaged communities.
- Barriers to ZEV Adoption: The average California drives less than 40 miles per day, well within the range of available ZEV models. However, achieving the states climate goals requires multiple approaches toward transportation electrification. Because ZEVs require longer charge times, range anxiety caused by the lack of infrastructure impedes the adoption of ZEVs in rural areas or for drivers seeking to make longer trips.
But as battery and charging technology continue to advance, greater access to charging infrastructure will promote greater adoption of ZEVs. Locating ZEVs in areas where drivers park for long durations, such as resident garages, mitigates some concerns associated with ZEV adoption. The development of level 2 chargers can now allow drivers to charge ZEVs from 12 to 20 miles per hour. The continue development of faster chargers combined with grid-integrated rates, can provide drivers with more flexibility in determining when to charge their vehicles, and at times that best support conditions of the state’s electricity grid throughout the day.
This bill requires the CPUC, in consultation with CARB and the CEC, to authorize the IOUs to offer programs and investments in electric vehicle service equipment installed in residential garages of customers who purchase used electric vehicles, as specified.
- Arguments in Support: According to SDG&E, “The secondary EV market is growing as early EV adopters are rolling off leases or trading in their EVs for newer models. The secondary market increases availability to a broader consumer base, where costs still weight heavily on their purchasing decisions. A Level 2 charger costs roughly $2,000 (including the unit price and installation) which is cost prohibitive to most drivers when purchasing a car, but even more for those purchasing on the secondary market. Multiple purchase incentives exist for new ZEVs in California, […] but purchases incentives for used ZEVs are minimal [...] This bill would remove a barrier to EV adoption. Convenient access to Level 2 charging at a driver’s home, where EVs are parked for the longest duration, offers important benefits and flexibility for both the driver and the electric grid.”
- Related Legislation: AB 1082 (Burke) of 2017 requires an electrical corporation to file with, and the CPUC to approve, a program proposal for the installation of electric charging stations at school facilities. Status: Pending in the Assembly Committee on Education.
AB 1083 (Burke) of 2017 requires an electrical corporation to file with, and the CPUC to approve, a program proposal for the installation of electric charging stations at state parks and beaches. Status: Pending in the Assembly Committee on Water, Parks and Wildlife.
AB 1184 (Ting) of 2017 requires the CPUC to establish a California Electric Vehicle Initiative to incentivize the purchase of electric vehicles in the state. Status: Pending in the Assembly Committee on Communications and Conveyance.
REGISTERED SUPPORT / OPPOSITION:
Support
San Diego Gas & Electric
Opposition
None on file.
Analysis Prepared by: Edmond Cheung / C. & C. / (916) 319-2637
Discussed in Hearing
1MIN
Assembly Floor
1H
Assembly Standing Committee on Appropriations
14MIN
Assembly Standing Committee on Communications and Conveyance
Bill Author
Bill Co-Author(s):