Under existing law, the Public Utilities Commission (PUC) has regulatory authority over public utilities, including electrical corporations. The Public Utilities Act imposes various duties and responsibilities on the commission with respect to the purchase of electricity and requires the PUC to review and adopt a renewable energy procurement plan for each electrical corporation pursuant to the California Renewables Portfolio Standard Program. The California Renewables Portfolio Standard Program requires a retail seller, as defined, to purchase specified minimum quantities of electricity products from eligible renewable energy resources, as defined, for specified compliance periods. A violation of the Public Utilities Act is a crime.

This bill would require each retail seller of electricity and each local publicly owned electric utility to procure a proportionate share of electricity products from a statewide total of 5,000 4,250 megawatts of qualified renewable energy resources, defined by the bill as a subset of eligible renewable energy resources that consists of certain bioenergy and geothermal energy resources with high performance relative to capacity, and certain solar and wind energy resources that are eligible for specified federal tax credits. The bill would require portions of that 5,000 4,250 megawatts to be procured from specified qualified renewable energy resources. The bill would require, no later than May 31, 2019, each retail seller to file with the PUC a plan for complying with this procurement requirement, as specified. If a community choice aggregator or electric service provider, by June August 1, 2019, fails to demonstrate it has secured sufficient enforceable and financeable procurement commitments to meet its proportionate share, the bill would require the applicable electrical corporation to procure the amount of any shortfall on behalf of the end-use customers of the community choice aggregator or direct access provider. The bill would require, no later than June 30, 2019, each local publicly owned electric utility to adopt a plan for complying with this procurement requirement, as specified. Under the bill, the electricity procured by retail sellers and local publicly owned electric utilities from these qualified renewable energy resources would count toward meeting their obligations under the California Renewables Portfolio Standard Program to purchase specified minimum quantities of electricity products from eligible renewable energy resources. Because a violation of these provisions would be a crime under the Public Utilities Act, the bill would impose a state-mandated local program. By imposing a new procurement requirement on local publicly owned electric utilities, this bill would impose a state-mandated local program.

Existing law requires the PUC and the State Energy Resources Conservation and Development Commission (Energy Commission) to undertake various actions in furtherance of meeting the states clean energy and pollution reduction objectives.

This bill would require the PUC and the Energy Commission to provide the Legislature, by March 31, 2019, with a joint assessment, as specified, of options for establishing a central statewide entity to procure electricity for all end-use retail customers in the state.

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

This bill would provide that no reimbursement is required by this act for specified reasons.

Under existing law, the Public Utilities Commission (PUC) has regulatory authority over public utilities, including electrical corporations. The Public Utilities Act imposes various duties and responsibilities on the commission with respect to the purchase of electricity and requires the PUC to review and adopt a renewable energy procurement plan for each electrical corporation pursuant to the California Renewables Portfolio Standard Program. The California Renewables Portfolio Standard Program requires a retail seller, as defined, to purchase specified minimum quantities of electricity products from eligible renewable energy resources, as defined, for specified compliance periods. A violation of the Public Utilities Act is a crime.

This bill would require each retail seller of electricity and each local publicly owned electric utility to procure a proportionate share, as determined by the PUC, in consultation with the State Energy Resources Conservation and Development Commission, share of electricity products from a statewide total of 3,000 5,000 megawatts of geothermal generation capacity, as specified. qualified renewable energy resources, defined by the bill as a subset of eligible renewable energy resources that consists of certain bioenergy and geothermal energy resources with high performance relative to capacity, and certain solar and wind energy resources that are eligible for specified federal tax credits. The bill would require portions of that 5,000 megawatts to be procured from specified qualified renewable energy resources. The bill would require, no later than December 31, 2020, May 31, 2019, each retail seller to file with the PUC a plan for complying with this procurement requirement, as specified. If a community choice aggregator or electric service provider, by June 1, 2019, fails to demonstrate it has secured sufficient enforceable and financeable procurement commitments to meet its proportionate share, the bill would require the applicable electrical corporation to procure the amount of any shortfall on behalf of the end-use customers of the community choice aggregator or direct access provider. The bill would require, no later than December 31, 2020, June 30, 2019, each local publicly owned electric utility to adopt a plan for complying with this procurement requirement, as specified. Under the bill, the electricity procured by retail sellers and local publicly owned electric utilities from these geothermal powerplants qualified renewable energy resources would count toward meeting their obligations under the California Renewables Portfolio Standard Program to purchase specified minimum quantities of electricity products from eligible renewable energy resources. The bill would require projects generating electricity procured pursuant to the bills requirements for which construction began on or after January 1, 2019, to demonstrate an environmental benefit and an economic benefit to disadvantaged communities, as defined. Because a violation of these provisions would be a crime under the Public Utilities Act, the bill would impose a state-mandated local program. By imposing a new procurement requirement on local publicly owned electric utilities, this bill would impose a state-mandated local program.

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

This bill would provide that no reimbursement is required by this act for specified reasons.

Under existing law, the Public Utilities Commission (PUC) has regulatory authority over public utilities, including electrical corporations. The Public Utilities Act imposes various duties and responsibilities on the commission with respect to the purchase of electricity and requires the PUC to review and adopt a renewable energy procurement plan for each electrical corporation pursuant to the California Renewables Portfolio Standard Program. The California Renewables Portfolio Standard Program requires a retail seller, as defined, to purchase specified minimum quantities of electricity products from eligible renewable energy resources, as defined, for specified compliance periods. A violation of the Public Utilities Act is a crime.

This bill would require, no later than December 31, 2021, require each retail seller of electricity and each local publicly owned electric utility to procure a proportionate share, as determined by the PUC, in consultation with the State Energy Resources Conservation and Development Commission, of electricity products from a statewide total of 3,500 3,000 megawatts of geothermal generation capacity, as specified. The bill would require, no later than December 31, 2019, 2020, each retail seller to file with the PUC a plan for complying with this procurement requirement, as specified. The bill would require, no later than December 31, 2019, 2020, each local publicly owned electric utility to adopt a plan for complying with this procurement requirement, as specified. The bill would authorize the PUC to determine whether Under the bill, the electricity procured by retail sellers and local publicly owned electric utilities from these geothermal powerplants should would count toward meeting their obligations under the California Renewables Portfolio Standard Program to purchase specified minimum quantities of electricity products from eligible renewable energy resources. The bill would require projects generating electricity procured pursuant to the bills requirements for which construction began on or after January 1, 2019, to demonstrate an environmental benefit and an economic benefit to disadvantaged communities, as defined. Because a violation of these provisions would be a crime under the Public Utilities Act, the bill would impose a state-mandated local program. By imposing a new procurement requirement on local publicly owned electric utilities, this bill would impose a state-mandated local program.

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

This bill would provide that no reimbursement is required by this act for specified reasons.

Under existing law, the Public Utilities Commission (PUC) has regulatory authority over public utilities, including electrical corporations. The Public Utilities Act imposes various duties and responsibilities on the commission with respect to the purchase of electricity and requires the commission PUC to review and adopt a renewable energy procurement plan for each electrical corporation pursuant to the California Renewables Portfolio Standard Program. The California Renewables Portfolio Standard Program requires a retail seller, as defined, to purchase specified minimum quantities of electricity products from eligible renewable energy resources, as defined, for specified compliance periods. A violation of the Public Utilities Act is a crime.

This bill would require, no later than December 31, 2021, each retail seller of electricity and each local publicly owned electric utility to procure a proportionate share, as determined by the commission, PUC, in consultation with the State Energy Resources Conservation and Development Commission, of electricity products from a statewide total of 2,500 3,500 megawatts of electricity generated by geothermal powerplants, geothermal generation capacity, as specified. The bill would require, no later than December 31, 2019, each retail seller to file with the commission PUC a plan for complying with this procurement requirement. requirement, as specified. The bill would require, no later than December 31, 2019, each local publicly owned electric utility to adopt a plan for complying with this procurement requirement, as specified. The bill would authorize the commission PUC to determine whether the electricity procured by retail sellers from these geothermal powerplants shall should count toward meeting their obligations under the California Renewables Portfolio Standard Program to purchase specified minimum quantities of electricity products from eligible renewable energy resources. The bill would require projects generating electricity procured pursuant to the bills requirements for which construction began on or after January 1, 2019, to demonstrate an environmental benefit and an economic benefit to disadvantaged communities, as defined, in California. defined. Because a violation of these provisions would be a crime under the Public Utilities Act, the bill would impose a state-mandated local program. By imposing a new procurement requirement on local publicly owned electric utilities, this bill would impose a state-mandated local program.

Existing law establishes the Office of Statewide Health Planning and Development, which is vested with all the duties, powers, responsibilities, and jurisdiction of the State Department of Public Health relating to health planning and research development. Existing law requires the office to work with the Employment Development Departments Labor Market Information Division, state licensing boards, and state higher education entities to collect data regarding, among other things, the current supply of health care workers, the geographical distribution of health care workers, and the current and forecasted demand for health care workers.

This bill would authorize local public health agencies and others to send data to the office regarding the number of graduate medical education slots necessary to meet the current and future physician and surgeon needs of the County of Imperial and similar medically underserved counties counties, as defined, from local public health or health planning agencies, entities engaged in the provision of health care services in those areas, and professional and educational associations, as specified.

This bill would make legislative findings and declarations as to the necessity of a special statute for the County of Imperial and other similar medically underserved counties.

Existing law, the Medical Practice Act, restricts the employment of physicians and surgeons or doctors of podiatric medicine by a corporation or other artificial legal entity to entities that do not charge for professional services rendered to patients and are approved by the Medical Board of California, subject to specified exemptions. Existing law, until January 1, 2024, also authorizes a federally certified critical access hospital to employ those medical professionals and to charge for professional services rendered by those medical professionals if the medical staff concur by an affirmative vote that the professionals employment is in the best interest of the communities served by the hospital and the hospital does not direct or interfere with the professional judgment of a physician and surgeon, as specified. Existing law requires, on and after July 1, 2017, and until July 1, 2023, require a federally critical access hospital employing those medical professionals under this authorization to submit a report, on or before July 1 of each year, to the office Office of Statewide Health Planning and Development, as specified.

Existing law, the Medical Practice Act, restricts the employment of physicians and surgeons or doctors of podiatric medicine by a corporation or other artificial legal entity to entities that do not charge for professional services rendered to patients and are approved by the Medical Board of California, subject to specified exemptions. Existing law, until January 1, 2024, also authorizes a federally certified critical access hospital to employ those medical professionals and to charge for professional services rendered by those medical professionals if the medical staff concur by an affirmative vote that the professionals employment is in the best interest of the communities served by the hospital and the hospital does not direct or interfere with the professional judgment of a physician and surgeon, as specified. Existing law requires, on and after July 1, 2017, and until July 1, 2023, require a federally critical access hospital employing those medical professionals under this authorization to submit a report, on or before July 1 of each year, to the office as specified.

This bill would state the intent of the Legislature to subsequently amend this bill to include provisions that would authorize rural hospitals to employ physicians and surgeons or doctors of podiatric medicine and to charge for professional services rendered by those medical professionals.

 THIRD READING  

Bill No: AB 893

Author:

:

Vote:

SENATE ENERGY, U. & C. COMMITTEE: 7-2, 6/27/18

AYES: Hueso, Bradford, Hertzberg, Hill, Skinner, Stern, Wiener

NOES: Morrell, Vidak

NO VOTE RECORDED: Cannella, McGuire

SENATE APPROPRIATIONS COMMITTEE: 5-2, 8/16/18

AYES: Portantino, Beall, Bradford, Hill, Wiener

NOES: Bates, Nielsen

ASSEMBLY FLOOR: 67-0, 5/18/17 - See last page for vote

SUBJECT:

SOURCE: County of Imperial

Imperial Irrigation District

DIGEST:

This bill requires, by December 31, 2021, each retail seller of electricity and each local publicly owned electric utility (POU) to procure a proportionate share of electricity products from a statewide total of 3,000 megawatts (MW) of geothermal generation capacity, as specified.

ANALYSIS:

Existing law:

1. Imposes, pursuant to the Public Utilities Act, various duties and responsibilities on the California Public Utilities Commission (CPUC) with respect to the purchase of electricity and requires the CPUC to review and adopt a renewable energy procurement plan for each investor-owned utility (IOU) and all retail sellers pursuant to the California Renewables Portfolio Standard Program (RPS). (Public Utilities Code §399.15)
2. Establishes the RPS and requires a retail seller, as defined, to purchase specified minimum quantities of electricity products from eligible renewable energy resources, as defined, for specified compliance periods. (Public Utilities Code §399.16)
3. Requires each POU to adopt and implement a renewable energy resources procurement plan that requires the utility to procure a minimum quantity of eligible renewable energy resources each compliance period to achieve the RPS procurement goals. (Public Utilities Code §399.30)
4. Requires the CPUC to identify a diverse and balanced portfolio of resources needed to ensure a reliable electricity supply that provides optimal integration of renewable energy in a cost-effective manner. The CPUC must direct each IOU to develop a procurement plan that includes a strategy for procuring best-fit and least-cost resources to meet the portfolio’s needs. (Public Utilities Code §454.51)
5. Authorizes Community Choice Aggregators (CCAs) to submit proposals to meet their portion of the renewable integration needs identified by the CPUC. (Public Utilities Code §454.51)
6. Requires each load serving entity (LSE) to prepare and file an integrated resource plan (IRP) that includes procurements enabling utilities to meet greenhouse gas (GHG) emissions reduction targets for the electricity sector. (Public Utilities Code §454.52)

This bill:

1. Requires each retail seller and POU to procure a proportionate share of electricity products from a statewide total of 3,000 MW of geothermal generation capacity from projects for which construction began before, on, or after January 1, 2019, that meet the requirements of paragraph (1) of subdivision (b) of Section 399.16.
2. Requires, no later than June 30, 2020, the CPUC, in consultation with the California Energy Commission (CEC), to determine the proportionate share of electricity products from the 3,000 MW of electricity that each retail seller and POU is required to procure.
3. Requires, no later than December 31, 2020, each retail seller to file with the CPUC a plan to comply with the geothermal procurement requirement, with one-half of the proportionate share of the retail seller to be procured by December 31, 2021, with deliveries of electricity products from that half of its proportionate share scheduled to commence no later than January 1, 2022, and require the other half of its proportionate share to be procured with deliveries of electricity products scheduled to commence no later than January 1, 2030.
4. Provides that a retail seller may procure its proportionate share by executing new contracts or by maintaining, extending, or renewing existing contracts for the purchase of electricity products from geothermal powerplants.
5. Requires the CPUC to, no later than June 30, 2021 review and approve, modify, or reject plans filed by retail sellers.
6. Requires, no later than December 31, 2020, each POU to adopt, as part of the renewable energy resources procurement plan required by subdivision (f) of Section 399.30, a plan for complying with subdivision (a) by procuring at least half of its proportionate share by December 31, 2021, with deliveries of electricity products from that half of its proportionate share scheduled to commence no later than January 1, 2022, and by procuring the other half of its proportionate share through contracts with deliveries of electricity products scheduled to commence no later than January 1, 2030.
7. Requires projects generating electricity procured under this section for which construction began on or after January 1, 2019, to demonstrate an environmental benefit and an economic benefit to California communities located within the boundaries of, and an environmental and an economic benefit to individuals living in, disadvantaged communities described in Section 39711 of the Health and Safety Code.
8. Requires the CPUC to allow for recovery of the costs of the procurement required by this section by retail sellers from all benefiting consumers.

Background

Geothermal energy in California. California contains one of the largest amounts of geothermal electric generation capacity in the United States due to its location on the Pacific’s “ring of fire” and because of the state encompasses some of the edges of the tectonic plates. Geothermal energy is a clean, renewable resource that provides energy in the United States and around the world in a variety of applications and resources. It is considered a renewable resource because the heat emanating from the interior of the Earth is essentially limitless. Currently, there are a total of 43 operating geothermal power plants in California with an installed capacity of 2,694 MW. In 2017, geothermal energy in California produced 11,745 gigawatt-hours (GWh) of electricity. Combined with another 700 GWh of imported geothermal power, geothermal energy produced 5.69 percent of the state’s total system power. The largest concentration of geothermal plants is located north of San Francisco in the Geysers Geothermal Resources Area in Lake and Sonoma Counties.

“Duck Curve” integration of renewables is a challenge for the electric grid. Geothermal generation is considered “baseload” renewable energy, since it runs 24 hours, in contrast to intermittent renewable resources, such as solar and wind, which operate when the sun is shining and when the wind is blowing. Geothermal generation, as a baseload energy resource, has historically lacked the ramping capability of “flexible” resources such as natural gas power plants that can ramp up and down quickly in response to the changing conditions on the electric grid from intermittent resources. Based on a joint presentation by Imperial Irrigation District (IID) and the California Independent System Operator (CAISO) from August 3, 2017, there is an acknowledgment that modern designs of geothermal plants provide a more flexible operation to better compliment renewable resources during the day and service to California consumers during the night. According to the presentation, the new geothermal plants can be used to provide services as load following, spinning and replacement reserve, inertia and frequency response. Geothermal power plants are also capable of achieving high-capacity factors – a measure of actual output over a period of time – usually at or above 90 percent – making them extremely reliable source of energy.

Renewable Portfolio Standard. California’s ambitious RPS program is jointly implemented and administered by the CPUC and the CEC. The RPS program requires the state’s energy LSEs, including IOUs, CCAs, Electric Service Providers (ESPs) and POUs to procure 50 percent of their total electricity retail sales from eligible renewable energy resources by 2030. The RPS requires milestones on the path to 2030, including interim goals of 25 percent by 2016, and 33 percent by 2020. The CPUC reviews and approves RPS Procurement Plans and Compliance Reports for the IOUs, CCAs, and ESPs. The CEC oversees RPS compliance for the POUs. The large IOUs served approximately 75 percent of the state’s retail electricity load in 2016, while the smaller IOUs, CCAs, and ESPs collectively served the remaining 25 percent. The POUs serve approximately 20-25 percent of California’s electric load, but are not retail sellers.

The state is well on its way to achieving its existing RPS targets. As shown in the table below, the state’s three largest electric utilities generally have met current procurement goals and anticipate exceeding future procurement goals:

IRP Reference System Plan. As required in SB 350, the IRP process requires the CPUC to identify a portfolio of resources for electricity procurement that provides optimal integration of renewable energy in a cost-effective manner, and minimize impacts on ratepayer’s bills. The identification of this portfolio is intended to guide LSEs’ IRPs, which help ensure that utilities meet GHG reduction targets for the electricity sector. The reference system plan is a guide – not a mandate. Earlier this year, the CPUC adopted a reference system plan, which identifies the energy procurements needed to help the LSEs meet specific GHG reduction goals. The CPUC adopted a GHG reduction goal of 42 million metric tons by 2030. To meet this target, the CPUC identified specific procurements for LSEs, noted in the IRP reference system plan.

IRP RESOLVE model. In its efforts to develop the IRP system reference plan, the CPUC utilized RESOLVE which is a model that can solve for the optimal investments in renewable resources, energy storage technologies, new gas plants, and gas plant retrofits subject to an annual constraint on delivered renewable energy that reflects the constraints of the RPS policy, GHG emissions and maintaining resource adequacy and reliability. The RESOLVE is a modeling tool, not a forecast, but it can help serve as a guide based on the assumptions included in the model. In the adopted CPUC IRP Reference System Plan, the CPUC noted the potential need for 202 MW of additional geothermal energy to meet the 2030 GHG goal.

Doing the Math. The author of this bill notes that the most recent update to the RESOLVE model (although not what was included in the adopted IRP Reference Plan) which incorporated the 2017 Integrated Energy Policy Report, is projecting 1,700 MW of incremental geothermal generating capacity, on top of the existing 1,200 MW of geothermal capacity serving the CAISO load. The author has also estimated a total of 600 MW of capacity based on data from the RESOLVE model and the assumption that the CAISO load amounts to about 81 percent of statewide emissions. This math is the basis for the author’s proposal to require 3,000 MW procurement of existing and new geothermal energy by 2030 in this bill. It’s important to note that the RESOLVE model’s growth in geothermal energy from the 202 MW in the adopted Reference System Plan to 1700 MW in the recent RESOLVE model assumes an increase in electric vehicles and behind-the-meter solar, which was acknowledged to also have a higher overall resource cost. However, it is unclear whether 3,000 MW is ultimately an accurate amount that will be necessary to achieve the state’s GHG goals. We are currently in the midst of the first IRP cycle, with a new cycle commencing every two years. LSEs were required to submit their first plans by August 1. The CPUC is the process of reviewing their just filed plans.

Large IOUs long on renewable procurement. As noted above, the large IOUs are currently long on procurement and are anticipated to meet their 2030 RPS requirements by 2020. Accordingly, the IOUs chose not to hold annual RPS solicitation in 2017. Initially the IOUs procured more renewables than necessary in part to hedge against potential RPS shortfalls due to the initial higher project failure rates. However, changes in the electricity landscape, in particular the load migration from IOUs to CCAs is resulting in less need for the IOUs to procure additional resources, including renewable energy resources. Considering LSEs and the CPUC are in the midst of the firs IRP cycle and the uncertainty in the electricity landscape due to load migration, an obvious question is whether any additional procurement is needed at this time.

Too much? Too soon? This bill mandates a procurement goal of 3,000 MW of geothermal energy from both existing and new projects. However, there is uncertainty as to the assumptions that 3,000 MW is an appropriate amount. In opposition to this bill, PG&E states the mandate in this bill would result in additional procurement costs of $300 to $400 million annually. Moreover, the pace of procurement proposed by this bill is ambitious. This bill requires LSEs to develop plans by the end of 2020 and procure the first half of their proportionate share of the 3,000 MW of geothermal by the end of 2021. Considering the RESOLVE model identified the need for geothermal energy procurement by 2030, the requirement in this bill to procure by 2020 seems premature.

Related/Prior Legislation

AB 2208 (Aguiar-Curry, 2018) would have required the incremental renewable energy procurement of each "retail seller" of electricity, i.e., IOUs, ESPs and CCAs, as well as POUs, to include an unspecified percentage of geothermal, biogas or biomass energy resources, including an unspecified percentage from the Salton Sea Known Geothermal Resource Area. The bill was held in the Assembly Committee on Appropriations.

SB 1139 (Hueso, 2014) would have required that retail sellers procure a statewide total of 500 MW of electricity generated by new geothermal powerplants by December 31, 2024. The bill died on the Assembly floor.

AB 920 (Aguiar-Curry, 2017) would have asserted that a “diverse and balanced portfolio of resources,” for purposes of an IOU’s procurement plan, shall include “an appropriate mix of renewable capacity and makes a similar requirement of IRP. The bill was held in the Senate Committee on Appropriations.

FISCAL EFFECT: Appropriation: Fiscal Com.: Local: Yes

According to the Senate Appropriations Committee:

• Costs in the hundreds of thousands to the CPUC and the CEC, as well as potential increased costs to the state as a utility ratepayer.
• Ongoing cost of about $200,000 (Utilities Reimbursement Account) for CPUC to support more proceeding management related to the RPS and/or IRP.
• Onetime costs of approximately $75,000 (special funds) for the CEC to update the RPS regulations, RPS Eligibility Guidebook, and Verification Methodology Report to reflect the requirements of this bill.
• Ongoing annual costs of $150,000 (special funds) for the CEC to review updated procurement plans, verify RPS procurement claims, and review application of optional compliance measures specific to the requirements of this bill on an annual and compliance period basis.
• Potential increased electricity costs for various state agencies (General Fund and special funds), possibly in the tens of millions of dollars.

SUPPORT: (Verified 8/17/18)

County of Imperial (co-source)

Imperial Irrigation District (co-source)

Calpine Corporation

Controlled Thermal Resources, Inc.

EnergySource LLC

Imperial County Building and Construction Trades Council, AFL-CIO

Imperial Valley Economic Development Corporation

International Brotherhood of Electrical Workers Local 569

Riverside County 4^th District Supervisor, V. Manual Perez

Salton Sea Authority

OPPOSITION: (Verified 8/17/18)

American Wind Energy Association California Caucus

California Chamber of Commerce

California Community Choice Association

California Municipal Utilities Association

California Wind Energy Association

Large-Scale Solar Association

Northern California Power Agency

Pacific Gas and Electric Company

PacifiCorp

Sacramento Municipal Utility District

San Diego Gas and Electric Company

Solar Energy Industries Association

Southern California Edison

Southern California Public Power Authority

ARGUMENTS IN SUPPORT: According to the author, “Geothermal power creates high-paying jobs at all times, not just during construction, pays property taxes and provides additional local revenue to some of the most impoverished areas of the state. Geothermal power employs 6 times more people than solar and 18 times that of wind. AB 893 encourages the continued operation and development of geothermal power, a renewable resource that adds diversity and reliability to our state’s energy portfolio while also providing co-benefits to the environment and economies of some of our state’s most disadvantaged communities.”

ARGUMENTS IN OPPOSITION: The arguments by those opposed generally reflect the sentiment that this bill’s procurement mandate will be costly to ratepayers, unnecessary, undermines the processes the Legislature has already put in place to address procurement of electric generation in a technological neutral fashion, and imposes an unrealistic procurement mandate of geothermal resources.

ASSEMBLY FLOOR: 67-0, 5/18/17

AYES: Acosta, Travis Allen, Arambula, Baker, Berman, Bigelow, Bloom, Bocanegra, Bonta, Brough, Burke, Caballero, Cervantes, Chávez, Chen, Chiu, Choi, Chu, Cooley, Cooper, Cunningham, Dababneh, Dahle, Daly, Eggman, Flora, Fong, Gallagher, Cristina Garcia, Eduardo Garcia, Gomez, Gonzalez Fletcher, Gray, Grayson, Irwin, Jones-Sawyer, Kalra, Kiley, Lackey, Levine, Limón, Low, Maienschein, Mathis, Mayes, McCarty, Medina, Muratsuchi, Nazarian, Obernolte, O'Donnell, Patterson, Quirk, Quirk-Silva, Reyes, Ridley-Thomas, Rodriguez, Rubio, Salas, Steinorth, Mark Stone, Thurmond, Ting, Voepel, Waldron, Weber, Wood

NO VOTE RECORDED: Aguiar-Curry, Calderon, Chau, Frazier, Friedman, Gipson, Gloria, Harper, Holden, Melendez, Mullin, Santiago, Rendon

Prepared by:

8/18/18 13:23:27

**** END ****

SENATE COMMITTEE ON APPROPRIATIONS

Senator Anthony Portantino, Chair

2017 - 2018 Regular Session

AB 893 (Eduardo Garcia) - California Renewables Portfolio Standard Program

This bill meets the criteria for referral to the Suspense File.

Bill Summary:

The bill would require each retail seller of electricity and each local publicly owned electric utility to procure a proportionate share of new geothermal capacity. At least half of the required 3,000 megawatts (MWs) would need to be procured by December 31, 2021. The other half would need to be procured by contracts with deliveries commencing no later than January 1, 2030.

Fiscal Impact:

Costs in the hundreds of thousands to the California Public Utilities Commission (CPUC) and the California Energy Commission (CEC), as well as potential increased costs to the state as a utility ratepayer.

• Ongoing cost of about $200,000 (Utilities Reimbursement Account) for CPUC to support more proceeding management related to the Renewables Portfolio Standard (RPS) and/or integrated resource plan.
• Onetime costs of approximately $75,000 (special funds) for the CEC to update the RPS regulations, RPS Eligibility Guidebook, and Verification Methodology Report to reflect the requirements of this bill.
• Ongoing annual costs of $150,000 (special funds) for the CEC to review updated procurement plans, verify RPS procurement claims, and review application of optional compliance measures specific to the requirements of this bill on an annual and compliance period basis.
• Potential increased electricity costs for various state agencies (General Fund and special funds), possibly in the tens of millions of dollars.

Background:

California’s RPS program is jointly implemented and administered by the CPUC and the CEC. The RPS program requires the state’s energy load serving entities (LSEs) to procure 50 percent of their total electricity retail sales from eligible renewable energy resources by 2030. The RPS requires milestones on the path to 2030, including interim goals of 25 percent by 2016, and 33 percent by 2020.The CPUC reviews and approves RPS Procurement Plans and Compliance Reports for the IOUs, CCAs, and ESPs. The CEC oversees RPS compliance for the POUs.

California contains one of the largest amounts of electric generation capacity from geothermal resources, defined as heat from the earth, in the United States due to its location on the Pacific’s “ring of fire” and because of the state encompasses some of the edges of the tectonic plates. Currently, there are a total of 43 operating geothermal power plants in California with an installed capacity of 2,694 MW. In 2017, geothermal energy in California produced 11,745 gigawatt-hours (GWh) of electricity. Combined with another 700 GWh of imported geothermal power, geothermal energy produced 5.69 percent of the state’s total system power. Geothermal generation is considered “baseload” renewable energy, since it runs 24 hours, in contrast to intermittent renewable resources, such as solar and wind, which operate when the sun is shining and when the wind is blowing.

Proposed Law:

This bill would:

1. Require each retail seller and publicly owned electric utility (POU) to procure a proportionate share of electricity products from a statewide total of 3,000 MW of geothermal generation capacity from projects for which construction began before, on, or after January 1, 2019, that meet the requirements of paragraph (1) of subdivision (b) of Section 399.16.
2. Require, no later than June 30, 2020, the CPUC, in consultation with the CEC, to determine the proportionate share of electricity products from the 3,000 MW of electricity that each retail seller and POU is required to procure.
3. Require, no later than December 31, 2020, each retail seller to file with the CPUC a plan to comply with the geothermal procurement requirement, with one-half of the proportionate share of the retail seller to be procured by December 31, 2021and the other half of its proportionate share to be procured no later than January 1, 2030.
4. Provide that the plan may authorize a retail seller to aggregate its proportionate share with the proportionate share of another retail seller or POU in order to minimize administrative and contracting costs.
5. Provide that a retail seller may procure its proportionate share by executing new contracts or by maintaining, extending, or renewing existing contracts for the purchase of electricity products from geothermal powerplants, so long as the retail seller continues to procure its share of these electricity products through the conclusion of the compliance periods set forth in paragraph (1) of subdivision (b) of Section 399.15.
6. Require the CPUC to, no later than June 30, 2021, review and approve, modify, or reject plans filed by retail sellers.
7. Require, no later than December 31, 2020, each POU to adopt, as part of the renewable energy resources procurement plan required by subdivision (f) of Section 399.30, a plan for complying with subdivision (a).
8. Authorize a POU to aggregate its proportionate share with the proportionate share of another retail seller or POU in order to minimize administrative and contracting costs and may procure its proportionate share by executing new contracts or by maintaining, extending, or renewing existing contracts for the purchase of electricity products from geothermal power plants.
9. Authorize the CPUC to determine whether electricity procured pursuant to this section shall count toward meeting the requirements specified in subparagraph (B) of paragraph (2) of subdivision (b) of Section 399.15.
10. Require projects generating electricity procured under this section to demonstrate an environmental benefit and an economic benefit to California communities located within the boundaries of disadvantaged communities.
11. Require the procurement expenditure limitations described in subdivision (c) of Section 399.15 to apply to procurement by retail sellers pursuant to this section.
12. Require the CPUC to allow for recovery of the costs of the procurement required by this section by retail sellers from all benefiting consumers.
13. Require any cost limitations adopted by the governing board of a POU pursuant to subparagraph (B) of paragraph (2) of subdivision (d) of Section 399.30 to apply to procurement by the POU pursuant to this section.

Related Legislation:

SB 1347 (Stern, 2018) would require the CPUC by January 1, 2020, to direct certain load serving entities (LSEs) to procure a total of 2,000 MW of energy storage. The bill establishes criteria for utilities to own and operate a portion of the procured storage and recover costs from the procurements through rates. The bill is currently scheduled to be heard in the Assembly Committee on Appropriations.

AB 2208 (Aguiar-Curry, 2018) would have required the incremental renewable energy procurement of each "retail seller" of electricity, i.e., IOUs, ESPs and CCAs, as well as POUs, to include an unspecified percentage of geothermal, biogas or biomass energy resources, including an unspecified percentage from the Salton Sea Known Geothermal Resource Area. The bill was held in the Assembly Committee on Appropriations.

Staff Comments:

Many LSEs already procure geothermal resources, but they do so within the context of their entire resource portfolio. Mandating energy procurement via legislation reduces LSEs’ procurement flexibility, which can drive up costs charged to ratepayers. Due to the higher relative costs of geothermal resources, AB 893 would likely result in a need to increase electricity rates in some areas. PG&E states the mandate in this bill would result in additional procurement costs of $300 to $400 million annually. This raises costs on individual ratepayers as well as the state, since state government is a major consumer of electricity.

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SENATE COMMITTEE ON ENERGY, UTILITIES AND COMMUNICATIONS

Senator Ben Hueso, Chair

2017 - 2018 Regular

Bill No: Hearing Date: 6/27/2018

SUBJECT:

DIGEST: This bill would require, by December 31, 2021, each retail seller of electricity and each local publicly owned electric utility (POU) to procure a proportionate share of electricity products from a statewide total of 3,500 megawatts (MW) of geothermal generation capacity, as specified.

ANALYSIS:

Existing law:

1. The Public Utilities Act imposes various duties and responsibilities on the California Public Utilities Commission (CPUC) with respect to the purchase of electricity and requires the CPUC to review and adopt a renewable energy procurement plan for each investor-owned utility (IOU) and all retail sellers pursuant to the California Renewables Portfolio Standard Program (RPS). (Public Utilities Code §399.15)
2. Establishes the RPS and requires a retail seller, as defined, to purchase specified minimum quantities of electricity products from eligible renewable energy resources, as defined, for specified compliance periods. (Public Utilities Code §399.16)
3. Requires each POU to adopt and implement a renewable energy resources procurement plan that requires the utility to procure a minimum quantity of eligible renewable energy resources each compliance period to achieve the RPS procurement goals. (Public Utilities Code §399.30)
4. Requires the CPUC to identify a diverse and balanced portfolio of resources needed to ensure a reliable electricity supply that provides optimal integration of renewable energy in a cost-effective manner. The CPUC must direct each IOU to develop a procurement plan that includes a strategy for procuring best-fit and least-cost resources to meet the portfolio’s needs. (Public Utilities Code §454.51)
5. Authorizes Community Choice Aggregators (CCAs) to submit proposals to meet their portion of the renewable integration needs identified by the CPUC. (Public Utilities Code §454.51)
6. Requires each load serving entity (LSE) to prepare and file an integrated resource plan (IRP) that includes procurements enabling utilities to meet greenhouse gas (GHG) emissions reduction targets for the electricity sector. (Public Utilities Code §454.52)
7. Defines as RPS eligible, electric generation resources from biomass, solar thermal, photovoltaic, wind, geothermal, fuel cells using renewable fuels, small hydroelectric generation of 30 MW or less, digester gas, landfill gas, ocean wave, ocean thermal, tidal current, and municipal solid waste conversion that uses a non-combustion thermal process to convert solid waste to a clean-burning fuel. (Public Resources Code §25741)

This bill:

1. Requires each retail seller and POU to procure a proportionate share of electricity products from a statewide total of 3,500 MW of geothermal generation capacity from projects for which construction began before, on, or after January 1, 2019, that meet the requirements of paragraph (1) of subdivision (b) of Section 399.16.
2. Requires, no later than June 30, 2019, the CPUC, in consultation with the California Energy Commission (CEC), to determine the proportionate share of electricity products from the 3,500 MW of electricity that each retail seller and POU is required to procure. Defines proportionate share to be based on the forecast retail sales for the year 2020.
3. Requires, no later than December 31, 2019, each retail seller to file with the CPUC a plan to comply with the geothermal procurement requirement, with one-half of the proportionate share of the retail seller to be procured by December 31, 2020, with deliveries of electricity products from that half of its proportionate share scheduled to commence no later than January 1, 2022, and require the other half of its proportionate share to be procured with deliveries of electricity products scheduled to commence no later than January 1, 2028.
4. Provides that the plan may authorize a retail seller to aggregate its proportionate share with the proportionate share of another retail seller or POU in order to minimize administrative and contracting costs.
5. Provides that a retail seller may procure its proportionate share by executing new contracts or by maintaining, extending, or renewing existing contracts for the purchase of electricity products from geothermal powerplants, so long as the retail seller continues to procure its share of these electricity products through the conclusion of the compliance periods set forth in paragraph (1) of subdivision (b) of Section 399.15.
6. Requires the CPUC to, no later than June 30, 2020, review and approve, modify, or reject plans filed by retail sellers. A retail seller shall not be deemed out of compliance with the requirement of subdivision (a) if, after the CPUC’s approval of the plan filed pursuant to this subdivision, a counterparty to a contract providing for deliveries of electricity products scheduled to commence no later than January 1, 2022, fails to commence delivery of the contracted electricity products by that date without fault of the retail seller.
7. Requires, no later than December 31, 2019, each POU to adopt, as part of the renewable energy resources procurement plan required by subdivision (f) of Section 399.30, a plan for complying with subdivision (a) by procuring at least half of its proportionate share by December 31, 2020, with deliveries of electricity products from that half of its proportionate share scheduled to commence no later than January 1, 2022, and by procuring the other half of its proportionate share through contracts with deliveries of electricity products scheduled to commence no later than January 1, 2028.
8. Authorizes a POU to aggregate its proportionate share with the proportionate share of another retail seller or POU in order to minimize administrative and contracting costs and may procure its proportionate share by executing new contracts or by maintaining, extending, or renewing existing contracts for the purchase of electricity products from geothermal power plants, so long as the POU continues to procure its share of these electricity products through the conclusion of the compliance periods set forth by subdivision (b) of Section 399.30.
9. Prohibits a POU from being deemed out of compliance with the requirements of subdivision (a) if, after adoption of a plan pursuant to this subdivision, a counterparty to a contract providing for deliveries of electricity products scheduled to commence no later than January 1, 2022, fails to commence delivery of the contracted electricity products by that date without fault of the POU.
10. Authorizes the CPUC to determine whether electricity procured pursuant to this section shall count toward meeting the requirements specified in subparagraph (B) of paragraph (2) of subdivision (b) of Section 399.15.
11. Requires projects generating electricity procured under this section for which construction began on or after January 1, 2019, to demonstrate an environmental benefit and an economic benefit to California communities located within the boundaries of, and an environmental and an economic benefit to individuals living in, disadvantaged communities described in Section 39711 of the Health and Safety Code. Environmental benefits may include, but are not limited to, reducing air pollution from oxides of nitrogen, particulate matter 2.5 microns and smaller in size, or fugitive dust, or enabling the production of lithium. Economic benefits may include, but are not limited to, creating high-quality jobs.
12. Requires the procurement expenditure limitations described in subdivision (c) of Section 399.15 to apply to procurement by retail sellers pursuant to this section.
13. Requires the CPUC to allow for recovery of the costs of the procurement required by this section by retail sellers from all benefiting consumers.
14. Requires any cost limitations adopted by the governing board of a POU pursuant to subparagraph (B) of paragraph (2) of subdivision (d) of Section 399.30 to apply to procurement by the POU pursuant to this section.
15. States that the provisions of this section are severable. If any provision of this section or its application is held invalid, that invalidity shall not affect other provisions or applications that can be given effect without the invalid provision or application.
16. States that no reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because a local agency or school district has the authority to levy service charges, fees, or assessments sufficient to pay for the program or level of service mandated by this act or because costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution.

Background

Geothermal Energy. Geothermal energy is defined as heat from the Earth. It is a clean, renewable resource that provides energy in the United States and around the world in a variety of applications and resources. It is considered a renewable resource because the heat emanating from the interior of the Earth is essentially limitless. A geothermal system requires heat, permeability, and water. To develop electricity from geothermal resources, wells are drilled into a geothermal reservoir. The wells bring the geothermal water to the surface, where its heat energy is converted into electricity at a geothermal power plant.

Geothermal Energy in California. California contains one of the largest amounts of geothermal electric generation capacity in the United States due to its location on the Pacific’s “ring of fire” and because of the state encompasses some of the edges of the tectonic plates. Currently, there are a total of 43 operating geothermal power plants in California with an installed capacity of 2,694 MW. In 2017, geothermal energy in California produced 11,745 gigawatt-hours (GWh) of electricity. Combined with another 700 GWh of imported geothermal power, geothermal energy produced 5.69 percent of the state’s total system power. The largest concentration of geothermal plants is located north of San Francisco in the Geysers Geothermal Resources Area in Lake and Sonoma Counties.

“Duck Curve” Integration of Renewables is a Challenge for the Electric Grid. Geothermal generation is considered “baseload” renewable energy, since it runs 24 hours, in contrast to intermittent renewable resources, such as solar and wind, which operate when the sun is shining and when the wind is blowing. Geothermal generation, as a baseload energy resource, has historically lacked the ramping capability of “flexible” resources such as natural gas power plants that can ramp up and down quickly in response to the changing conditions on the electric grid from intermittent resources. Based on a joint presentation by Imperial Irrigation District (IID) and the California Independent System Operator (CAISO) from August 3, 2017, there is an acknowledgment that modern designs of geothermal plants provide a more flexible operation to better compliment renewable resources during the day and service to California consumers during the night. According to the presentation, the new geothermal plants can be used to provide services as load following, spinning and replacement reserve, inertia and frequency response. Geothermal power plants are also capable of achieving high-capacity factors – a measure of actual output over a period of time – usually at or above 90 percent – making them extremely reliable source of energy.

Renewable Portfolio Standard. California’s ambitious RPS program is jointly implemented and administered by the CPUC and the CEC. The RPS program requires the state’s energy LSEs, including IOUs, CCAs, Electric Service Providers (ESPs) and POUs to procure 50 percent of their total electricity retail sales from eligible renewable energy resources by 2030. The RPS requires milestones on the path to 2030, including interim goals of 25 percent by 2016, and 33 percent by 2020. The CPUC reviews and approves RPS Procurement Plans and Compliance Reports for the IOUs, CCAs, and ESPs. The CEC oversees RPS compliance for the POUs. The large IOUs served approximately 75 percent of the state’s retail electricity load in 2016, while the smaller IOUs, CCAs, and ESPs collectively served the remaining 25 percent. The POUs serve approximately 20-25 percent of California’s electric load, but are not retail sellers.

The state is well on its way to achieving its existing RPS targets. As shown in the table below, the state’s three largest electric utilities generally have met current procurement goals and anticipate exceeding future procurement goals:

SB 350 and the Integrated Resources Plan. SB 350 required, among other provisions, a process for integrated resource planning that will ensure that LSEs meet targets that allow the electricity sector to contribute to California’s economy-wide GHG emissions reductions goals.  As part of the IRP process, the CPUC adopts rules which govern the procurement process. These rules are updated biennially and support competitive procurement. Procurement plans of each LSE details what is going to be procured and how it will be done. These plans must adhere to state policies, including the energy loading order, which mandates that energy efficiency and demand response be pursued first, followed by renewables and lastly clean-fossil generation. If the LSEs procurement plans do not comply with state policies and adequately balance safety, reliability, cost, and environmental goals, the CPUC can order the utilities to modify them.

IRP Reference System Plan. The IRP process requires the CPUC to identify a portfolio of resources for electricity procurement that provides optimal integration of renewable energy in a cost-effective manner, and minimize impacts on ratepayer’s bills. The identification of this portfolio is intended to guide LSEs’ IRPs, which help ensure that utilities meet GHG reduction targets for the electricity sector. The reference system plan is a guide – not a mandate. Earlier this year, the CPUC adopted a reference system plan, which identifies the energy procurements needed to help the LSEs meet specific GHG reduction goals. The CPUC adopted a GHG reduction goal of 42 million metric tons by 2030. To meet this target, the CPUC identified specific procurements for LSEs, noted in the IRP reference system plan. The CPUC recently issued a ruling providing updated GHG emission benchmarks to guide LSE planning towards the IRP filing deadline on August 1^st of this year. These IRPs filed by individual LSEs will enable the CPUC to determine whether California is on track to meet its 2030 GHG reduction target with a diverse and balanced mix of resources.

IRP RESOLVE Model. In its efforts to develop the IRP system reference plan, the CPUC utilized RESOLVE which is an optimal investment and operational model designed to inform long-term planning questions with regards to renewables integration in systems with high penetration levels of renewable energy. The model is formulated as a linear optimization problem that can solve for the optimal investments in renewable resources, energy storage technologies, new gas plants, and gas plant retrofits subject to an annual constraint on delivered renewable energy that reflects the constraints of the RPS policy, GHG emissions and maintaining resource adequacy and reliability. The RESOLVE is a modeling tool, not a forecast, but it can help serve as a guide based on the assumptions included in the model. In the adopted CPUC IRP Reference System Plan, the CPUC noted the potential need for 202 MW of additional geothermal energy to meet the 2030 GHG goal.

Doing the Math. The author of this bill notes that the most recent update to the RESOLVE model, which incorporated the 2017 Integrated Energy Policy Report, is projecting 1,700 MW of incremental geothermal generating capacity, on top of the existing 1,200 MW of geothermal capacity serving the CAISO load. The author has also estimated a total of 600 MW of capacity based on data from the RESOLVE model and the assumption that the CAISO load amounts to about 81 percent of statewide emissions. This math is the basis for the author’s proposal to require 3,500 MW procurement of existing and new geothermal energy by 2030 in this bill. It’s important to note that the RESOLVE model’s growth in geothermal energy from the 202 MW in the adopted Reference System Plan to 1700 MW in the recent RESOLVE model assumes an increase in electric vehicles and behind-the-meter solar, which was acknowledged to also have a higher overall resource cost. However, it is unclear whether 3,500 MW is ultimately an accurate amount that will be necessary to achieve the state’s GHG goals. We are currently in the midst of the first IRP cycle, with a new cycle commencing every two years. LSEs are still developing their first plans which are not due until August 1^st of this year. Under the envisioned IRP process, LSEs would continue to select a procurement that best matches the least-cost best fit for their needs and their load.

Large IOUs Long on Renewable Procurement. As noted above, the large IOUs are currently long on procurement and are anticipated to meet their 2030 RPS requirements by 2020. Accordingly, the IOUs chose not to hold annual RPS solicitation in 2017. Initially the IOUs procured more renewables than necessary in part to hedge against potential RPS shortfalls due to the initial higher project failure rates. However, changes in the electricity landscape, in particular the load migration from IOUs to CCAs is resulting in less need for the IOUs to procure additional resources, including renewable energy resources. Considering LSEs are currently developing their IRPs and the uncertainty in the electricity landscape due to load migration, a natural question is whether any additional procurement is needed at this time.

Too Much? Too Soon? This bill mandates a procurement goal of 3,500 MW of geothermal energy from both existing and new projects. However, there is uncertainty as to the assumptions that 3,500 MW is an appropriate amount. In opposition to this bill, PG&E states the mandate in this bill would result in additional procurement costs of $300 to $400 million annually. The author may wish to consider reducing the megawatts required in this bill significantly so as to ensure costs are also appropriately managed and to minimize the impact on ratepayers. Moreover, the pace of procurement proposed by this bill is ambitious. This bill requires LSEs to develop plans by the end of 2019 and procure the first half of their proportionate share of the 3,500 MW of geothermal by the end of 2020. Considering the RESOLVE model identified the need for geothermal energy procurement by 2030, the requirement in this bill to procure by 2020 seems premature. The author may wish to consider slowing the pace of procurement.

Precedent? Mandating energy procurement via legislation may be less than desirable for the LSEs. Nonetheless, there have been previous efforts to require specific energy procurement in previous legislative bills and state budget adoption, including in 2016 when the Legislature and governor adopted SB 859 (Committee on Budget and Fiscal Review, Chapter 368, Statutes of 2016) whose section 14 requires IOUs to procure additional 125 MW of biomass generation by December 1, 2016 in the form of five-year contracts. This was the second carve-out for biomass energy generation. More recently, this committee has supported SB 1347 (Stern, 2018) which would require LSEs to procure their proportionate share of 2,000 MW of energy storage. That bill is pending in the Assembly Committee on Energy and Utilities.

RPS Eligible? This bill authorizes the CPUC to determine whether the geothermal energy procurement mandate should qualify for compliance with the RPS. Considering statute already identifies geothermal as a renewable, it is unclear why any procurement of this by a LSE should not satisfy the RPS requirements. The author should strike this provision in this bill.

Need for Jobs. The author notes that geothermal power projects can spur economic development and job creation for impoverished areas. Whereas solar projects provide most of the direct job benefits during the construction phase of the project, geothermal plants require workers during the operation of the plant.

Disadvantaged Community. This bill requires that the geothermal procurement benefits disadvantaged communities, as identified by the CalEnviroScreen. Presumably, the author seeks to direct investments to areas of the state with high pollution and high rates of poverty, such as Imperial County. Pacific Power has requested the author amend this bill to exempt it from the disadvantaged community target in order to account for the lack of disadvantaged communities, as defined by the CalEnviroScreen, within its service territory. However, Pacific Power notes its service territory encompasses low-income customers who would bear the higher costs from the proposed procurement mandate.

Prior/Related Legislation

SB 1347 (Stern, 2018) would require the CPUC by January 1, 2020, to direct certain LSEs to procure a total of 2,000 MW of energy storage. The bill establishes criteria for utilities to own and operate a portion of the procured storage and recover costs from the procurements through rates. The bill is currently scheduled to be heard in the Assembly Committee on Utilities and Energy.

AB 2208 (Aguiar-Curry, 2018) would have required the incremental renewable energy procurement of each "retail seller" of electricity, i.e., IOUs, ESPs and CCAs, as well as POUs, to include an unspecified percentage of geothermal, biogas or biomass energy resources, including an unspecified percentage from the Salton Sea Known Geothermal Resource Area. The bill was held in the Assembly Committee on Appropriations.

SB 1139 (Hueso, 2014) would have required that retail sellers procure a statewide total of 500 MW of electricity generated by new geothermal powerplants by December 31, 2024. The bill died on the Assembly floor.

AB 920 (Aguiar-Curry, 2017) would have asserted that a “diverse and balanced portfolio of resources,” for purposes of an IOU’s procurement plan, shall include “an appropriate mix of renewable capacity and makes a similar requirement of IRP. The bill was held in the Senate Committee on Appropriations.

FISCAL EFFECT: Appropriation: Fiscal Com.: Local:

SUPPORT:

Imperial Irrigation District (Co-sponsor)

County of Imperial (Co-sponsor)

Controlled Thermal Resources, Inc.

EnergySource LLC

Imperial County Building and Construction Trades Council AFL-CIO

Imperial Valley Economic Development Corporation

International Brotherhood of Electrical Workers Local 569

Salton Sea Authority

OPPOSITION:

American Wind Energy Association California Caucus

California Chamber of Commerce

California Community Choice Association

California Municipal Utilities Association

California Wind Energy Association

Large-Scale Solar Association

Northern California Power Agency

Pacific Gas and Electric Company

PacifiCorp

Sacramento Municipal Utility District

San Diego Gas and Electric Company

Solar Energy Industries Association

Southern California Public Power Authority

ARGUMENTS IN SUPPORT: According to the author:

“California has made significant strides towards achieving a low-carbon grid. Chief amongst them is the Renewables Portfolio Standard program that has resulted in a transformation of the state’s energy sector into one dependent on renewable resources. However, an energy portfolio that is oversubscribed with intermittent resources, like solar and wind, runs counterintuitive to California’s environmental and economic goals. When there is too much supply, we have to curtail, or reduce the output of renewable resources, below what they are capable of producing. When there is too little supply, we need backup capacity, usually coming from natural gas plants. Geothermal power creates high-paying jobs at all times, not just during construction, pays property taxes and provides additional local revenue to some of the most impoverished areas of the state. Geothermal power employs 6 times more people than solar and 18 times that of wind.

AB 893 encourages the continued operation and development of geothermal power, a renewable resource that adds diversity and reliability to our state’s energy portfolio while also providing co-benefits to the environment and economies of some of our state’s most disadvantaged communities.”

ARGUMENTS IN OPPOSITION: The arguments by those opposed generally reflect the sentiment that this bill’s procurement mandate will be costly to ratepayers, unnecessary, undermines the processes the Legislature has already put in place to address procurement of electric generation in a technological neutral fashion, and imposes an unrealistic procurement mandate of 3,500 MW of geothermal resources. Additionally, several of those opposed are concerned by the uncertainty that the geothermal procurement would not count towards RPS compliance.

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SENATE COMMITTEE ON HEALTH

Senator Ed Hernandez, O.D., Chair

BILL NO: AB 893

SUBJECT: Public health: graduate medical education

SUMMARY:

Permits the Office of Statewide Health Planning and Development to receive data regarding the number of graduate medical education slots necessary to meet the current and future physician and surgeon needs of the County of Imperial and similar medically underserved counties.

Existing law:

1. Establishes the California Healthcare Workforce Policy Commission (Commission) and requires the Commission to, among other things, identify specific areas of the state where unmet priority needs for primary care family physicians and registered nurses exist; establish standards for family practice training programs, family practice residency programs, primary care physician assistants programs, and programs that train primary care nurse practitioners; and review and make recommendations to Office of Statewide Health Planning and Development (OSHPD) concerning the funding of those programs that are submitted to the Health Professions Development Program for participation in the state medical contract program.
2. Establishes the Health Professions Education Foundation (HPEF) within OSHPD. Requires the HPEF to solicit and receive funds from Foundations and other private and public sources and to provide financial assistance in the form of scholarships or loans to students in the health professions who are from underrepresented groups. Provides that HPEF governed by a board consisting of 13 members appointed by the Governor, Speaker of the Assembly, and Senate Rules Committee.
3. Establishes, under the HPEF, scholarship, loan, and loan repayment programs for registered nurses, vocational nurses, geriatric nurse practitioners, clinical nurse specialists, and mental health professionals who agree to practice for specified periods of time in underserved areas and in designated practice settings, as specified.
4. Establishes, under HPEF, the Steven M. Thompson Physician Corps Loan Repayment Program (STPCLRP), which provides for the repayment of educational loans for licensed physicians and surgeons who practice in medically underserved areas of the state, as defined. Requires HPEF, in administering the STPCLRP, to use and develop guidelines for applicants that give preference to applicants who are best suited to meet the cultural and linguistic needs of patients in medically underserved populations, as specified, and who agree to practice in geriatric care settings. Also allows HPEF to appoint a selection committee to provide policy direction and guidance to the STPCLRP. Requires funds for loan repayment under the STPCLRP to have a funding match from a Foundation or other private source. Establishes a Medically Underserved Account for Physicians within the Fund, the primary purpose of which is to provide funding for the STPCLRP.
5. Establishes the Song-Brown Health Care Workforce Training Act of 1973 (Song-Brown Act), administered by OSHPD to provide financial support to family practice residency programs, nurse practitioner and physician assistant programs, and registered nurse education programs to increase the number of students and residents receiving education and training in family practice and nursing. The Song-Brown Act also encourages universities and primary care health professionals to provide health care in medically underserved areas.

This bill:

1. Permits OSHPD to receive data regarding the number of graduate medical education slots necessary to meet the current and future physician and surgeon needs of the County of Imperial and similar medically underserved counties from the following entities:
2. Local public health or health planning agencies;
3. Entities engaged in the provision of health care services in those areas, including, but not limited to, hospitals and physician groups; and,
4. Professional and educational associations, such as the American Medical Association, the American Health Planning Association, the Association of American Medical Colleges, the American College of Physicians, and the Accreditation Council for Graduate Medical Education (ACGME).
5. Defines “similar medically underserved counties” to mean counties that are contain medically underserved areas and populations as designated by the Health Resources and Services Administration of the United States Department of Health and Human Services.

FISCAL EFFECT:

This bill is keyed nonfiscal.

PRIOR VOTES:

COMMENTS:

1. Author’s statement. According to the author, a large segment of the population in Imperial County are Medi-Cal members (42%) and with Medi-Cal rates at the lowest in the country, generating a market competitive income for primary care physicians makes it difficult to recruit new physicians. Even with Rural Health Clinics and Federally Qualified Heath Centers (who are able to employ physicians) in the area, there has never been a successful effort to meet the physician needs in the service area. The author concludes that by developing reports that reflect which counties are medically underserved, professional and educational associations will be better informed when placing physicians and surgeons.
2. Physician shortage. According to a February 2017 report published by the Healthforce Center at University of California San Francisco (UCSF), the supply of primary care physicians in California is insufficient to meet the population’s needs. Only 36% of physicians provide primary care. Primary care physicians are also poorly distributed across the state with smaller ratios to population in rural areas than in urban areas. The greatest shortages of primary care clinician are in the Inland Empire Northern and Sierra, and San Joaquin Valley regions. Areas surrounding the cities of San Francisco, Sacramento, and San Diego have a somewhat greater supply of primary care clinicians than other regions of the state, while the Los Angeles area lags behind other metropolitan areas. Existing shortages of primary care clinicians are exacerbated by clinicians’ demographic characteristics. One third of California’s primary care physicians are age 55 or older. Older primary care physicians are much less likely to provide patient care than their younger peers and those who provide patient care work fewer hours per week. In addition, racial and ethnic minorities, particularly Latinos, are underrepresented in the primary care workforce relative to the California population. The number of residency positions in primary care has increased, but not all primary care residents will go on to provide primary care or will stay in California following graduation. Thus, the numbers of new graduates will not be sufficient to replace all primary care physicians who are expected to retire within the next decade.
   
   Graduate Medical Education (GME). According to the University of California (UC), GME is supervised training that prepares doctors for independent practice in a recognized medical or surgical specialty. Following a four-year medical school education, resident physicians typically spend three to seven years in GME training. The ACGME is responsible for the accreditation of medical residency programs through the U.S. There are 27 ACGME-accredited specialty programs such as family medicine, pediatrics and surgery. There are 881 ACGME-accredited residency programs in California which train nearly 11,000 medical residents and fellows. These programs are run by 82 different sponsoring organizations. Roughly 5,000 residents are enrolled in UC-sponsored residency and affiliated family medicine programs. Other sponsors include major Academic Medical Centers such as Cedar-Sinai, Loma Linda, USC, and Stanford, as well as Kaiser and many community based hospitals.

According to the UCSF study, the numbers of graduates of medical schools will increase over the next several years as students enrolled in UC Riverside and California Northstate University medical schools begin to graduate in 2017 and 2019, respectively. The number of physician graduates will further increase in 2023 if Kaiser Permanente’s medical school begins enrolling students in 2019 as planned. California retains greater percentages of graduates of its medical schools and residency programs than other states. Approximately, 63% of persons who graduate from medical schools in California in 2014 remain in California to practice. In the U.S. overall, only 39% of medical school graduates practice in the state in which they attended medical school. In 2014, 70% of graduates of residency programs in California practice in California, whereas only 47% of graduates of residency programs nationwide practice in the state in which they were trained. Most training programs are concentrated in the state’s three largest metropolitan areas: Los Angeles, San Diego, and the San Francisco Bay Area. Few are located in the Inland Empire, Northern and Sierra, and San Joaquin Valley regions, the areas of the state that have the lowest supplies of primary care physicians relative to population. There are some primary care residency programs in regions of the state that have the lowest ratios of primary care physicians to population, including a large concentration in the western part of the Inland Empire region. The Northern and Sierra region has the lowest number of primary residency programs. The only primary care residency programs in this region, which spans a vast geographic area, are located in Redding.

According to UC, In California, approximately an additional 8,200 primary care physicians will be needed by 2030. Nationally, student enrollment in medical schools has increased by 25% between 2002 and 2015, while the number of GME positions has only increased by 17% since 2006.

1. State GME funding. According to the Senate Budget Subcommittee on Health and Human Services April 27, 2017 agenda, the 2016 Budget Act appropriated $33.3 million to OSHPD and approved budget bill language to augment existing health care workforce initiatives as follows:

These funds were the first installment of a three-year, $100 million General Fund (GF) allocation for these purposes, which included budget bill language to make funds available for expenditure and encumbrance until June 30, 2022. The funds were approved, in part because of reductions in federal and private funding for healthcare workforce development, including the expiration of one-time funding from the California Endowment, the federal Health Resources and Services Administration, and the federal Teaching Health Centers Graduate Medical Education program. The Governor’s 2017-18 budget proposed to revert the $33.3 million GF allocation for health care workforce initiatives approved in the 2016 Budget Act. The budget also proposed not to include the second-year installment of $33.3 million for health care workforce initiatives and notes that no additional funding is included for this purpose in the future. The Legislature rejected the Governor’s proposal and approved restoration the annual allocation of $33.3 million General Fund for three years, beginning in 2017-18, for primary care residency slots and student loan repayments. Proposition 56, which increases excise taxes on tobacco products by $2, includes a $40 million annual allocation to the UC for physician training.

1. Related legislation. AB 148 (Mathis) expands eligibility for the California Physician Corps Program in rural areas, until January 1, 2020, by revising the definition of “practice setting” to include a clinic that has at least 30% of patients in rural areas; and, a physician owned and operated medical practice setting that provides primary care located in a medically underserved area and has at least 30% of patients in rural areas. AB 148 passed the Senate Health Committee by a vote of 8-0 on July 12, 2017.
2. Prior legislation. SB 22 (Roth of 2016) would have established the Medical Residency Training Advisory Panel within OSHPD’s Health Professions Education Foundation, consisting of 13 members, as specified. Specified the duties of the Advisory Panel and OSHPD for the purpose of establishing and funding new residency positions in medically underserved areas of the state. SB 22 was held at the request of the author.

SB 1416 (Rubio and Hernandez of 2012) would have created the GME Trust Fund for the purpose of funding grants to graduate medical education residency programs in California, and would have required OSHPD to develop criteria for distribution of available moneys. SB 1416 was held on the Assembly Appropriations Committee suspense file.

SB 1471 (Hernandez of 2016) would have required funds in the Managed Care Administrative Fines and Penalties Fund to be transferred each year to the Medically Underserved Account for Physicians in the Health Professions Education Fund and to the Major Risk Medical Insurance Fund, as specified. SB 1471 was held on the Assembly Appropriations Committee suspense file.

AB 2216 (Bonta of 2016) would have created the Teaching Health Center Primary Care Graduate Medical Education Fund (Fund) and required the OSHPD Director, subject to appropriation by the Legislature, to award planning and development grants and sustaining grants from the Fund to teaching health centers for the purpose of establishing new accredited or expanded primary care residency programs. AB 2216 was held on the Senate Appropriations Committee suspense file.

1. Support. The Association of California Healthcare Districts supports long-term solutions to addressing the health care workforce shortage and maldistribution of physicians, especially in rural and underserved communities throughout the state. It is very difficult for these regions to attract a physician workforce and loan repayment programs are a critical step in solving the health care workforce shortage and ensuring access to healthcare services in the most underserved areas of the state. The California Academy of Family Physicians believes this bill addresses the shortfall of physicians as shown in OSHPD data.
   
2. Policy Comment. This bill allows OSHPD to receive data but doesn’t require OSHPD to do anything with the data. A bill is not necessary for this purpose.

1. Amendments. The committee and author may wish to adopt the following amendments to compel OSHPD to produce a onetime report on GME slots.
   

127805. (a) The Office of Statewide Health Planning and Development shall submit a report to the Legislature on or before October 1, 2018 may receive data regarding the number of graduate medical education slots necessary to meet the current and future physician and surgeon needs of the County of Imperial and similar medically underserved counties. The report shall include information from the following entities: from the following entities:

(1) Local public health or health planning agencies.

(2) Entities engaged in the provision of health care services in those areas, including, but not limited to, hospitals and physician groups.

(3) Professional and educational associations, such as the American Medical Association, the American Health Planning Association, the Association of American Medical Colleges, the American College of Physicians, and the Accreditation Council for Graduate Medical Education.

(b) For purposes of this section, “similar medically underserved counties” means counties that are primary care health professional shortage areas, contain medically underserved areas and populations as designated by the Health Resources and Services Administration of the United States Department of Health and Human Services.

(c) The office shall use the most recently published data provided by the National Resident Matching Program in the development of this report.

(d)(1) A report to be submitted pursuant to subdivision (a) shall be submitted in compliance with Section 9795 of the Government Code.

(2) Pursuant to Section 10231.5 of the Government Code, this section is repealed on January 1, 2020.

SUPPORT AND OPPOSITION:

Support: Association of Healthcare Districts

California Academy of Family Physicians

Oppose: None on file

-- END --

ASSEMBLY THIRD READING

ATR Bill Id:AB 893

Author:(Eduardo Garcia)

As Amended Ver:

Majority vote

SUMMARY: Authorizes the Office of Statewide Health Planning and Development (OSHPD) to receive data regarding the number of graduate medical education (GME) slots necessary to meet the current and future physician needs of Imperial County and similar medically underserved counties, as defined, from various organizations and agencies including, but not limited to, local public health or health planning agencies, hospitals and physician groups, and professional and educational associations, as specified.

FISCAL EFFECT: None

COMMENTS: According to the author, a large segment of the population in Imperial County are Medi-Cal members (42%) and with Medi-Cal rates at the lowest in the country, generating a market competitive income for primary care physicians makes it difficult to recruit new physicians. The author states that Even with Rural Health Clinics and Federally Qualified Heath Centers (who are able to employ physicians) in the area, there has never been a successful effort to meet the physician needs in the service area. The author concludes that creating residency programs in this area will help us meet physician needs.

1. GME. GME, or residency training, is the second phase of the educational process that prepares doctors for independent practice in a medical or surgical specialty, such as pediatrics, or oncology. Resident physicians typically spend three to seven years in GME training following a four-year medical school education. Since 1965, Medicare has been the largest funder of GME. In 1997 Congress capped the number of residency slots for which hospitals could receive Medicare GME funding and has not increased the cap since. California has approximately 12.2% of the nation's population, yet only 8.6% of the medical residents and fellows. According to the University of California Office of the President, if California's share were proportional to the national average, the state would have an additional 4,200 medical residents and fellows.
2. Physician supply and demand in California. California is home to the largest number of primary care physicians (PCPs) and nurse practitioners in the country. However, the state ranks 23rd in the number of PCPs per resident. An August 2014 report by the California HealthCare Foundation states that California has only 35 to 49 PCPs per 100,000 Medi-Cal enrollees. Federal guidelines call for the state to have 60 to 80 doctors per 100,000 patients. The supply of PCPs also varies substantially across California's counties. The number of PCPs actively practicing in California counties is, in too many cases, at the bottom range of, or below, the state's need. According to 2011 Health Resources and Services Administration (HRSA) data, 29 of California's 58 counties fall at the lower end or below the needed supply range for PCPs. In other words, half of Californians live in a community where they do not have adequate access to the health care services they need.

According to a 2013 report by the Robert Graham Center, "California: Projecting Primary Care Physician Workforce," to maintain current rates of utilization, California will need an additional 8,243 PCPs by 2030, a 32% increase compared to the states' current (as of 2010) 25,153 PCP workforce.

1. Medically Underserved Areas (MUAs) and Populations. MUAs/Populations are areas or populations designated by the federal HRSA as having too few primary care providers, high infant mortality, high poverty, or a high elderly population. Health Professional Shortage Areas are designated by HRSA as having shortages of primary medical care, dental or mental health providers and may be geographic (a county or service area), population (e.g. low income or Medicaid eligible) or facilities (e.g. federally qualified health center or other state or federal prisons).
2. State funding for GME. The 2016-17 Budget Act included $33.3 million per year for three years from the General Fund to support new and existing primary care residency positions. That funding was specifically appropriated to the Song-Brown Program, which provides funding for new primary care residency positions. However the Governor's proposed budget for 2017 completely eliminated those funds.

The California Medical Association (CMA) supports this bill stating that California ranks 32nd in the number of primary care residents and fellows per 100,000 population and six of nine California regions are facing a primary care shortage. CMA notes that there are two principal determinants of where a physician practices: a) where he or she grew up; and, b) where he or she completes residency training following medical school graduation. CMA concludes that this bill seeks to address the serious physician shortage facing California by requiring OSHPD to collect data on the number of GME slots needed in the state's most rural counties.

There is no opposition to this bill.

Analysis Prepared by: Lara Flynn / HEALTH / (916) 319-2097 FN: 0000376

Date of Hearing: May 9, 2017

ASSEMBLY COMMITTEE ON HEALTH

Jim Wood, Chair

ABPCA Bill Id:AB 893

Author:(Eduardo Garcia) – As Amended Ver:May 1, 2017

SUBJECT: Public health: graduate medical education.

SUMMARY: Authorizes the Office of Statewide Health Planning and Development (OSHPD) to receive data regarding the number of graduate medical education (GME) slots necessary to meet the current and future physician needs of Imperial County and similar medically underserved counties from various organizations and agencies including, but not limited to, local public health or health planning agencies, hospitals and physician groups, and professional and educational associations, as specified.

EXISTING LAW:

1. Establishes OSHPD for the purpose of collecting data and disseminating information about California's healthcare infrastructure, promoting an equitably distributed healthcare workforce, and publishing information about healthcare outcomes.
2. Establishes the California Healthcare Workforce Policy Commission (Commission) and requires the Commission to, among other functions, identify specific areas of the state where unmet priority needs for primary care family physicians and registered nurses exist; establish standards for family practice training programs, family practice residency programs, primary care physician assistants programs, and programs that train primary care nurse practitioners; and, review and make recommendations to OSHPD concerning the funding of those programs that are submitted to the Health Professions Development Program for participation in the state medical contract program.
3. Creates the Steven M. Thompson Program within the Health Professions Education Foundation, administered by the OSHPD, which provides for the repayment of educational loans for physicians and surgeons who practice in medically underserved areas (MUAs) of the state.

FISCAL EFFECT: None

COMMENTS:

1. PURPOSE OF THIS BILL. According to the author, a large segment of the population in Imperial County are Medi-Cal members (42%) and with Medi-Cal rates at the lowest in the country, generating a market competitive income for primary care physicians makes it difficult to recruit new physicians.  The author states that Even with Rural Health Clinics and Federally Qualified Heath Centers (who are able to employ physicians) in the area, there has never been a successful effort to meet the physician needs in the service area.  The author concludes that creating a residency programs in this areas will help us meet physician needs.
2. BACKGROUND.
   1. GME. GME, or residency training, is the second phase of the educational process that prepares doctors for independent practice in a medical or surgical specialty, such as pediatrics, or oncology. Resident physicians typically spend three to seven years in GME training following a four-year medical school education. Since 1965, Medicare has been the largest funder of GME. In 1997 Congress capped the number of residency slots for which hospitals could receive Medicare GME funding and has not increased the cap since. California has approximately 12.2% of the nation's population, yet only 8.6% of the medical residents and fellows. According to the University of California Office of the President, if California's share were proportional to the national average, the state would have an additional 4,200 medical residents and fellows.
   2. Physician supply and demand in California. California is home to the largest number of primary care physicians (PCPs) and nurse practitioners in the country. However, the state ranks 23rd in the number of PCPs per resident. An August 2014 report by the California HealthCare Foundation states that California has only 35 to 49 PCPs per 100,000 Medi-Cal enrollees. Federal guidelines call for the state to have 60 to 80 doctors per 100,000 patients. The supply of PCPs also varies substantially across California’s counties. The number of PCPs actively practicing in California counties is, in too many cases, at the bottom range of, or below, the state's need. According to 2011 Health Resources and Services Administration (HRSA) data, 29 of California’s 58 counties fall at the lower end or below the needed supply range for PCPs. In other words, half of Californians live in a community where they do not have adequate access to the health care services they need.
      
      According to a 2013 report by the Robert Graham Center, "California: Projecting Primary Care Physician Workforce," to maintain current rates of utilization, California will need an additional 8,243 PCPs by 2030, a 32% increase compared to the states' current (as of 2010) 25,153 PCP workforce.
   3. MUAs and Populations. MUAs/Populations are areas or populations designated by the federal HRSA as having too few primary care providers, high infant mortality, high poverty, or a high elderly population. Health Professional Shortage Areas are designated by HRSA as having shortages of primary medical care, dental or mental health providers and may be geographic (a county or service area), population (e.g. low income or Medicaid eligible) or facilities (e.g. federally qualified health center or other state or federal prisons). According to OSHPD there are 168 MUAs in California, including Imperial County.
   4. State funding for GME. The 2016-17 Budget Act included $33.3 million per year for three years from the General Fund to support new and existing primary care residency positions. That funding was specifically appropriated to the Song-Brown Program, which provides funding for new primary care residency positions. However the Governor's proposed budget for 2017 completely eliminated those funds.
3. SUPPORT. The California Medical Association (CMA) supports this bill stating that California ranks 32^nd in the number of primary care residents and fellows per 100,000 population and six of nine California regions are facing a primary care shortage. CMA notes that there are two principal determinants of where a physician practices: a) where he or she grew up; and, b) where he or she completes residency training following medical school graduation. CMA concludes that this bill seeks to address the serious physician shortage facing California by requiring OSHPD to collect data on the number of GME slots needed in the state's most rural counties.
4. PREVIOUS LEGISLATION.
   1. AB 2216 (Bonta) of 2016 would have created the Teaching Health Center Primary Care Graduate Medical Education Fund (Fund) and required the OSHPD Director, subject to appropriation by the Legislature, to award planning and development grants and sustaining grants from the Fund to teaching health centers for the purpose of establishing new accredited or expanded primary care residency programs. AB 2216 was held in the Senate Appropriations Committee.
   2. SB 1471 (Hernandez) of 2016 would have required funds in the Managed Care Administrative Fines and Penalties Fund to be transferred each year to the Medically Underserved Account for Physicians in the Health Professions Education Fund and to the Major Risk Medical Insurance Fund, as specified. SB 1471 was held in the Assembly Appropriations Committee.
   3. SB 1416 (Rubio and Hernandez) of 2012 would have created the Graduate Medical Education Trust Fund for the purpose of funding grants to GME residency programs in California, and would have required OSHPD to develop criteria for distribution of available moneys. SB 1416 was held in the Assembly Appropriations Committee.
5. SUGGESTED AMENDMENTS.
   1. As currently drafted this bill allows OSHPD to receive data from various agencies and organizations, regarding the number of GME slots necessary to meet the current and future physician needs of Imperial County and similar medically underserved counties. However, OSHPD does not currently collect information on shortages of residencies, but rather shortages of providers through the Healthcare Workforce Clearinghouse. Should this bill move forward, the author may want to identify an additional agency to partner with on a study regarding the need for rural GME residencies.
   2. As currently drafted the bill does not define "similar medically underserved counties," the Committee may wish to amend the bill to specify which other rural counties should be included in any future study.

REGISTERED SUPPORT / OPPOSITION:

Support
California Medical Association
Association of California Healthcare Districts

Opposition
None on file.

Analysis Prepared by: Lara Flynn / HEALTH / (916) 319-2097