Existing law requires a city or county that determines that a project, as defined, is subject to the California Environmental Quality Act to identify any public water system that may supply water for the project and to request those public water systems to prepare a specified water supply assessment. If no public water system is identified, the city or county is required to prepare the water supply assessment. Existing law defines project for purposes of these provisions as, among other things, a project that would demand an amount of water equivalent to, or greater than, the amount of water required by a 500 dwelling unit project. For a public water system that has fewer than 5,000 service connections, existing law defines project as development that would account for a specified increase in the number of service connections. Existing law, until January 1, 2018, exempts from the definition of project a proposed photovoltaic or wind energy generation facility that would demand no more than 75 acre-feet of water annually.

This bill would indefinitely exempt from the definition of project a proposed photovoltaic or wind energy generation facility that would demand no more than 50 acre-feet of water annually. The bill would thereby extend the duties on local agencies with respect to determining whether a project is subject to the water supply assessment requirements, thereby imposing a state-mandated local program.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that, if the Commission on State Mandates determines that the bill contains costs mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above.

Date of Hearing: April 4, 2017

ASSEMBLY COMMITTEE ON WATER, PARKS, AND WILDLIFE

Eduardo Garcia, Chair

ABPCA Bill Id:AB 594 (

Author:Irwin) – As Introduced Ver:February 14, 2017

SUBJECT: Water supply planning: California Environmental Quality Act: photovoltaic or wind energy generation facility

SUMMARY: Removes a sunset date of January 1, 2018, for a specified Water Supply Assessment exemption, and reduces the exemption from 75 acre-feet per year to 50 acre-feet per year. Specifically, this bill:

Extends indefinitely that a photovoltaic or wind energy plant that uses water below a specific threshold is not subject to the requirement to do a water supply assessment (WSA), if it demands no more than 50 acre-feet of water annually.

EXISTING LAW:

Water Supply Assessments. Requires a WSA whenever a city or county determines a proposed “project” is subject to CEQA. The WSA must be included in any CEQA document prepared for the project. In turn, a provision of CEQA requires compliance with specific requirements.

1. Defines a “project” requiring a WSA is any of the following:
   1. A proposed residential development of more than 500 dwelling units.
   2. A proposed shopping center or business establishment employing more than 1,000 persons or having more than 500,000 square feet of floor space.
   3. A proposed commercial office building employing more than 1,000 persons or having more than 250,000 square feet of floor space.
   4. A proposed hotel or motel, or both, having more than 500 rooms.
   5. A proposed industrial, manufacturing, or processing plant, or industrial park planned to house more than 1,000 persons, occupying more than 40 acres of land, or having more than 650,000 square feet of floor area.
   6. A mixed-use project that includes one or more of the projects specified in this subdivision.
   7. A project that would demand an amount of water equivalent to, or greater than, the amount of water required by a 500 dwelling unit project.
   8. Until January 1, 2018, a proposed photovoltaic or wind energy generation facility is not a project if the facility would demand no more than 75 acre-feet of water annually.
2. The WSA is prepared by the public water system that may provide water for the project, or, if the city or county identifies no such public water system, the city or county prepares the WSA.
3. The WSA is required to include a discussion regarding whether the total projected water supplies (during normal, single dry, and multiple dry water years) over the next 20 years will meet the projected water demand associated with the proposed project, over and above that required for existing and planned future uses. Further, when a water supply for a proposed project includes groundwater, the WSA must include additional information about the sufficiency of the groundwater supply.

Sustainable Groundwater Management Act (SGMA). Existing law specifies that SGMA, among other provisions, directs the Department of Water Resources (DWR) to categorize the state’s groundwater basins into high, medium, low, and very low priorities, based on factors such as the population overlying the basin, number of wells in the basin, and overlying irrigated acreage. The DWR must also identify basins subject to critical overdraft. Under SGMA:

1. Basins designated as high or medium priority must be managed by a groundwater sustainability agency (GSA). GSA’s must develop a groundwater sustainability plan (GSP) to ensure that by 2040, the basin is in a sustainable condition.
2. A GSP must include, among other things, a description of the consideration given to the applicable county and city general plans, and a description of the various adopted water resources-related plans and programs within the basin, and an assessment of how the GSP may affect those plans.
3. A de minimus amount is defined as under two acre-feet of water for domestic use.

FISCAL EFFECT: Unknown

COMMENTS:

Creation of Water Supply Assessments—Show Us the Water. In 2001, the Legislature passed, and Governor Davis signed SB 221 (Kuehl), and SB 610 (Costa), Chapters 642 and 643, Statutes of 2001. Collectively, these two bills are also known as the “show us the water” bills. The purpose of these bills, as noted in the findings for SB 610, was “to strengthen the process pursuant to which local agencies determine the adequacy of existing and planned future water supplies to meet existing and planned future demands on those water supplies.”

To assist local governments in deciding whether to approve projects, SB 610 requires a Water Supply Assessment (WSA) whenever a city or county determines a proposed project is subject to CEQA. The WSA must be included in any CEQA document prepared for the project. In turn, a provision of CEQA requires compliance with the SB 610 requirements.

The WSA is prepared by the public water system that may provide water for the project, or, if the city or county identifies no such public water system, the city or county prepares the WSA. The WSA is required to include a discussion regarding whether the total projected water supplies (during normal, single dry, and multiple dry water years) over the next 20 years will meet the projected water demand associated with the proposed project, over and above that required for existing and planned future uses. Further, when a water supply for a proposed project includes groundwater, the WSA must include additional information about the sufficiency of the groundwater supply.

A project requiring a WSA can be any of the following proposed uses: residential developments with over 500 dwelling units; shopping centers or businesses that employ more than 1,000 persons or have more than 500,000 square feet of floor space; commercial office buildings employing more than 1,000 persons or having more than 250,000 square feet of floor space; hotels or motels having more than 500 rooms; industrial, manufacturing, or processing plants, or industrial parks planned to house more than 1,000 persons, occupying more than 40 acres of land, or having more than 650,000 square feet of floor area; mixed-use projects that include one or more of the above; or any other project that would demand an amount of water equivalent to, or greater than, the amount of water required by a 500 dwelling unit project.

Previous Analysis of AB 267. The Senate Natural Resources Committee undertook an extensive review of the original exemption and noted that while renewable energy can sometimes demand a large amount of water (according to then-recent reports), “that generally cannot be said for photovoltaic and wind energy facilities. A recent Congressional Research Service report estimates the average total water intensity of photovoltaics is 4 gallons per megawatt-hour (MWh), and zero gallons per MWh for wind. This compares to concentrated solar power/solar towers with an intensity of 840 gallons per MWh and enhanced geothermal at 585 gallons per MWh. Still, there may be additional water demands for dust suppression, fire prevention, and on-site water uses by employees.”

Further, the analysis of the original bill reviewed the so-called camel’s nose. “SB 610 was industry-neutral, focused instead on characteristics of a proposed land use. The (original) bill would exempt a specific type of industry that would demand less water than the amount required by a 500 dwelling unit project from having to complete a WSA. It is conceivable, if not likely, that there are other types of projects or industries that might seek a specific exemption; their argument being that they, too, use less water than the 500 dwelling unit and so should similarly be exempt.” The analysis suggested that, rather than an industry exemption, rather a general exemption could be considered for those industries proving that they use significantly less water than that of a 500 dwelling unit project. This exemption is not proposed in the current legislation.

Addressing Water Supply Assessments under SGMA. SB 1262 (Pavley), Chapter 594, Statutes of 2016, added to the WSA requirements by:

1. Adding information about the reliance on and management of groundwater supplies in factors considered in determining if there are sufficient water supplies for residential development of more than 500 units.
2. Specifying that a Groundwater Sustainability Plan (GSP) may be included as substantial evidence in a public water system’s written verification of its ability or inability to provide sufficient water supply as part of approval of a residential development of more than 500 units.
3. Including an identification of water systems that are adjacent to large-scale projects subject to the California Environmental Quality Act (CEQA) that trigger a water supply assessment.
4. Adding SGMA compliance status to required information in a water supply assessment for projects that receive water supply from groundwater.

Do New Groundwater Assessments Change the Baseline? The SGMA of 2011 required local agencies to manage groundwater. Specifically, local agencies are required to form Groundwater Sustainability Agencies (GSA), account-for and manage groundwater through a groundwater sustainability plan (GSP). Early implementation of these plans (by 2020) is required for those high- and medium- priority basins in critical overdraft. Because of the nature of the energy consumption, several of the new, small-scale photovoltaic projects, are proposed to be located in Kern County, Riverside County, and San Bernardino County. These also happen to be areas where critical overdraft of groundwater has occurred. The shift of land use to renewable energy may have an impact on these basins, in a positive or negative way.

De Minimis Extractor. A complicating factor in the decision of whether or not a development (of any size) should be exempted from a water supply assessment, or, separately, compliance and participation in sustainable groundwater management is addressed in Water Code 10721 (e) which states, “De minimis extractor means a person who extracts, for domestic purposes, two acre-feet or less per year.” Supporters of AB 594 suggest that the amount extracted for photovoltaic or wind energy is less than 10 acre feet per year (for such things as landscaping, bathroom plumbing, or, in some cases, washing of solar panels). The de minimis extractor definition would challenge how a public water supplier should address the use of water. Indeed, given the recent drought and severe water challenges in critically over-drafted basins, one might ask if a project using 5-10 acre-feet per year should be exempted. Or, should the project be proposed, that a water supply assessment requirement consider seriously the location of the project in proximity to groundwater basins. This is, in part, addressed through SB 1262 by specifying that a Groundwater Sustainability Plan (GSP) may be included as substantial evidence in a public water system’s written verification of its ability or inability to provide sufficient water supply as part of approval of a residential development of more than 500 units. However, the bill does not specifically address the use of water for energy projects.

Data Supporting the Industry Claims. The industry claims that the amount of water used by photovoltaic and wind energy is significantly under the amount used by a 500 dwelling unit project. In a move to appease some of the opposition to previous bills, AB 594 reduces the exclusion to facilities that can prove to use no more than 50 acre-feet of water annually. A 500 dwelling unit project, using the statewide average water use, would consume 250 acre feet of water per year. According to the proponents, a selection of projects shows that water use for photovoltaic projects is significantly under the 50 acre-feet of water threshold. Three projects are cited as examples: (1) Alpine (Los Angeles County) would provide 66 MW and received a conditional use permit for a maximum of two acre-feet per year; (2) Desert Sunlight (Mohave Desert) estimates less than one acre-foot per year primarily for drinking, washing and toilet maintenance; and, (3) Los Hills (Kern County) would provide 32 MW and is estimated to use less than one-acre foot per year. In each instance, the project proponent was required to provide information on the use of water for the project for sanitary, landscaping, and solar panel maintenance as part of their estimation of water use.

Applying Sunsets to Legislation. As stated previously, the exemption for photovoltaic or wind generation projects that use no more than 75 acre-feet of water annually from being defined as a “project” for purposes of water supply assessment, expires in January 2018 (previously this expired in 2017, but was extended). The purpose of applying the sunset provision is to allow the public and Legislature the opportunity to review new information and evidence as it relates to the law. In this case, the law has significantly changed since the original exemption in 2011, particularly with the addition of SGMA. The authors have amended the original exemption to now define a project by use of no more than 50 acre-feet of water annually.

Related Legislation:

1. SB 221 (Kuehl), Chapter 642, Statutes of 2001, required cities and counties to demonstrate a sufficient water supply as part of the subdivision map act.
2. SB 610 (Costa), Chapter 643, Statutes of 2001, required large-scale development to have a water supply assessment.
3. SB 267 (Rubio), Chapter 588, Statutes of 2011, created the exemption from water supply assessments for certain renewable energy projects that use less than 75 acre feet per year. The bill had a 2017 sunset date.
4. AB 2561 (Irwin), Chapter 669, Statutes of 2016, extended the sunset date until 2018.
5. SB 1168 (Pavley), Chapter 346, Statutes of 2014, enacted SGMA.
6. AB 1738 (Dickinson), Chapter 347, Statutes of 2014, enacted SGMA.
7. SB 1262 (Pavley), Chapter 1262, Statutes of 2016, addressed water supply assessments as related to SGMA for housing developments.

Author’s Statement: According to the author, “AB 594 will extend an exclusion from water supply assessments for large solar and wind projects. These projects require very little water and thus were exempted from the assessments through previous legislation. A continuation of this exclusion will help ensure that California is not delayed in reaching its renewable energy goals.”

Double Referral: Should this bill pass this committee it will be re-referred to Assembly Local Government Committee.

Arguments in Support: According to the supporters, projects utilizing photovoltaic or wind generation use very little water which is why they were excluded from the definition of a project (for purposes of water supply assessment). Current law excludes photovoltaic or wind generation facilities that use no more than 75 acre-feet of water annually from being defined as a “project” under Water code Section 10912 (a)(5)(B), and subsequently from the requirements to perform a water supply exemption. AB 594 removes the 2018 expiration date to this exemption and changes the water demand threshold down to 50 acre-feet of water annually.

Under Section 10912 of the Water Code, a project is defined as a “proposed industrial, manufacturing, or processing plant, or industrial park planned to house more than 1,000 persons, occupying more than 40 acres of land, or having more than 650,000 square feet of floor. While this language is primarily focused on industrial sites, many renewable facilities would be defined as a “project” beginning in 2018 on land alone, rather than water use. Accordingly, AB 594 helps avoid the potentially tedious, time consuming and costly water supply assessments that may follow by renewing the status quo and continuing to exempt these renewable facilities from being defined as a “project” indefinitely.

SB 594 also reduces the water demand threshold by one-third to ensure that this exemption for photovoltaic generation projects remains limited.

Arguments in Opposition: Opposition to the concept of the water supply exemption focuses on the argument that California’s water conditions have changed dramatically. A five-year drought combined with the state’s first comprehensive regulation of groundwater (the Sustainable Groundwater Management Act of 2011), has highlighted the need to focus on critically over-drafted groundwater basins and accurate accounting of water demand. They assert that it is not appropriate to provide any exemption from critical water supply assessment process without careful evaluation, particularly at a time when water conditions are in tremendous flux. Because wind and solar projects tend to be hot and arid climates, where sunshine is abundant, this can also be where water is in overdraft. Adding even small straws to overdraft basins can be challenging. Opposition claims that SB 267’s original water use threshold of 75 acre-feet is no longer de minimus, and that today, conditions are far different. The same 75 acre-feet of water per year could serve as many as 500 homes in some areas. Finally, the opposition states that, “a set numeric threshold does not account for the future effects of climate change and it ignores the dramatic differences in water supply conditions across the state.”

REGISTERED SUPPORT / OPPOSITION:

Support

California Wind Energy Association

Independent Energy Producers Association (Sponsor)

Terra-Gen, LLC

Opposition

None on file.

Analysis Prepared by: Catherine Freeman / W., P., & W. /