Existing law establishes various state programs pertaining to energy technologies that advance environmental protection goals, including renewable energy resources, energy efficiency, energy conservation, weatherization, energy storage, distributed generation, and transportation electrification and other low-emission transportation measures. technologies.

This bill would establish the Clean Energy Financing Clearinghouse, a new office under the direction of the Treasurer, with the purposes of coordinating all government programs that invest capital in energy technologies that advance environmental protection and environmental justice goals to enable those programs to achieve their individual missions, making program information clear and accessible for market participants, and partnering with capital providers, investors, project developers, technology companies, and other market actors to catalyze more private investment into energy technologies that advance environmental protection and environmental justice goals, leveraging more private investment per public dollar used. The bill would specify functions that the Clean Energy Financing Clearinghouse is to perform with respect to cross-agency coordination, partnering with market actors, and partnering with capital providers.

Existing law establishes various state programs pertaining to energy technologies that advance environmental protection goals, including renewable energy resources, energy efficiency, energy conservation, weatherization, energy storage, distributed generation, and transportation electrification and other low-emission transportation measures.

This bill would establish the Clean Energy Financing Clearinghouse, a new office with the purposes of coordinating all government programs that invest capital in energy technologies that advance environmental protection goals to enable those programs to achieve their individual missions, making program information clear and accessible for market participants, and partnering with capital providers, investors, project developers, technology companies, and other market actors to catalyze more private investment into energy technologies that advance environmental protection goals, leveraging more private investment per public dollar used. The bill would specify functions that the Clean Energy Financing Clearinghouse is to perform with respect to cross-agency coordination, partnering with market actors, and partnering with capital providers.

SENATE COMMITTEE ON APPROPRIATIONS

Senator Ricardo Lara, Chair

2017 - 2018 Regular Session

SB 1380 (Stern) - Climate adaptation information clearinghouse

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

Bill Summary: SB 1380 adds clean energy funding and financing opportunities to the list of topics that must be included in the Office of Planning and Research’s (OPR) clearinghouse for climate adaptation.

Fiscal Impact:

• Unknown, potentially significant one-time costs (General Fund) for OPR to conduct research necessary to obtain up-to-date information on energy funding and financing opportunities, and to develop materials to inform decision-makers.
• Minor ongoing costs (General Fund) to OPR to maintain up-to-date information on energy funding and financing opportunities.
• Minor costs (various special funds) to departments with relevant programs for consultation.

Background:

The Office of Planning and Research (OPR). OPR was created by statute in 1970 to conduct long-range planning and research. In addition to being the state planning agency, a series of amendments to Government and Public Resources Codes, have added multiple other functions, including: conflict resolution among state agencies; coordination of federal grants for environmental goals, statewide environmental monitoring, and research on growth; and operation of the Integrated Climate Adaptation and Resiliency Program. In furtherance of its wide-ranging responsibilities, OPR manages the climate change clearinghouse to provide a centralized information source help inform decision-makers on climate change and resiliency issues.

Climate change mitigation, adaptation, and the energy sector. According to the Senate Environmental Quality Committee Analysis, there are “many state and local policies designed to reduce GHG emissions because deep and severe cuts in global GHG emissions are needed to avoid the most severe consequences of a changing climate…Even if all GHG emissions ceased today, many impacts of climate change would still be unavoidable…Adapting to the irreversibly changing climate is crucial for public health, environmental quality, natural resources protection, food stability, infrastructure maintenance, and withstanding severe weather events like heavier rains, heat waves, and drought.

California’s energy infrastructure plays an important role in mitigating for climate change resulting in several policies to clean up California’s energy generators. Most notably, the Renewables Portfolio Standard (RPS), which sets a target for renewable energy to make up 33% of California’s total energy mix by 2020 and 50% by 2030. Like many projects that aim to mitigate or adapt to California’s changing climate, financing for clean energy projects can be complicated and include a wide array of disparate sources including, but not limited to, state funding through agencies, local and federal funding, and private sources of capital.

What is a clearinghouse? A clearinghouse is centralized place for information to be stored and distributed. SB 246 (Wieckowski, Chapter 606, Statutes of 2015) directed OPR to create a clearinghouse to be a centralized source of information that provides available climate data to guide decision-makers at state, regional, and local levels when planning for and implementing climate adaptation projects to promote resiliency to climate change.

Proposed Law: This bill adds clean energy funding and financing opportunities to the list of topics that must be covered in the OPR clearinghouse for climate adaptation.

Related Legislation:

SB 246 (Wieckowski, Chapter 606, Statutes of 2015) established the Climate Advisory Council, with a range of experience, to support OPR by providing scientific and technical support and to facilitate coordination among state, regional, and local agency efforts to adapt to the impacts of climate change.

AB 1482 (Gordon, Chapter 603, Statutes of 2015) requires the CNRA to regularly update the Safeguarding California Plan, requires state agencies to maximize specified objectives across sector vulnerabilities, and requires the SGC review activities and funding to meet the priorities of the Plan.

SB 379 (Jackson, Chapter 608, Statutes of 2015) requires local jurisdictions to include climate vulnerability and adaptation considerations in their general plan updates.

SB 1217 (Leno, 2014) would have required the CNRA and SGC to prepare a climate risk assessment and strategy evaluating California’s vulnerability and risk for climate change impacts and to identify and prioritize climate resiliency projects. SB 1217 died in the Assembly Appropriations Committee.

AB 2329 (Ruskin/Chesbro, 2010) would have enacted the CAT Act of 2010 to coordinate oversight of state agency efforts to meet GHG reduction targets, including development and implementation of mitigation and adaptation plans. AB 2329 failed on the Senate Floor.

SB 721 (Steinberg, 2009) was a reintroduction of SB 1760 (Perata, 2008), which was vetoed. SB 721 would also have required the CAT to biennially prepare and adopt a climate change impact mitigation and adaptation plan including specified information. SB 721 died in the Senate Appropriations Committee.

-- END --

SENATE COMMITTEE ON ENVIRONMENTAL QUALITY

Senator Wieckowski, Chair

2017 - 2018 Regular

Bill No: SB 1380

SUBJECT: Clean Energy Financing Clearinghouse

ANALYSIS:

Existing law:

1. Establishes the Strategic Growth Council (SGC). (Public Resources Code (PRC) §75121)
   
2. Requires the Office of Planning and Research (OPR) to serve the Governor and Cabinet as staff for long-range planning and research, constituting the comprehensive state planning agency, with a focus on factors influencing the quality of the state’s environment. (Government Code (GOV) §65040)
   
3. Establishes an advisory council to support OPR by providing scientific and technical support and to facilitate coordination among state, regional, and local agency efforts to adapt to the impacts of climate change. (PRC §71358)
   
4. Requires the Director of OPR to coordinate regional and local efforts with state climate adaptation strategies with, to the extent feasible, an emphasis on climate equity and strategies that benefit both Greenhouse Gas (GHG) emissions reductions and adaptation efforts. (PRC §71354). Requires the Program to include:
   
   1. Working with and coordinating local and regional adaptation efforts, including developing tools and guidance, promoting and coordinating state agency support, and informing state-led programs, planning processes, grant programs, and guidelines development through regular coordination among state agencies, the Climate Action Team (CAT) established by Executive Order S-3-05, and the SGC.
      
   2. Assisting the Office of Emergency Services (OES) and other relevant agencies with coordinating regular reviews and updates to the Adaptation Planning Guide (APG).
      
   3. Conducting regular meetings with the advisory council as established.
      
   4. Coordinating and maintaining the state’s clearinghouse for climate adaptation information.
      
5. Establishes a clearinghouse within OPR to be a centralized source of information that provides available climate data to guide decisionmakers at state, regional, and local levels when planning for and implementing climate adaptation projects to promote resiliency to climate change. (PRC §71360)
   

This bill:

1. Defines “clean energy” to mean, among many other things, weatherization, energy conservation, energy savings, insulation, demand reduction, any form of energy that is RPS-eligible, no- and low-carbon electrical generation technologies including fuel cells, advanced vehicle technology including plug-in and hybrid electric light-duty, medium-duty, and heavy-duty vehicles and hydrogen fuel cell vehicles.
   
2. Establishes the Clean Energy Financing Clearinghouse to be a new office under the direction of the State Treasurer, to (1) coordinate all government programs that invest capital in energy technologies that advance environmental protection goals to enable them to achieve their individual missions, (2) make information on these programs clear and accessible for market participants, and (3) partner with capital providers, investors, project developers, technology companies, and other market actors to catalyze more private investment in energy technologies that advance environmental protection and environmental justice goals, leveraging more private investment per public dollar used.
   
3. Requires the Clean Energy Financing Clearinghouse to consult and coordinate with various state entities for specified purposes.
   
4. Requires the Clean Energy Financing Clearinghouse to perform various functions for “market actors” for specified purposes.
   
5. Requires the Clean Energy Financing Clearinghouse to perform various functions for capitol providers for specified purposes.
   
6. Requires the Clean Energy Financing Clearinghouse to (1) address commercial building efficiency as a priority market sector, (2) have a dedicated staff of professionals that have the technical, financial, and energy industry skills required to perform its functions, and (3) work closely with markets and operate in a flexible manner in order to bridge any gap that exists between public resources and programs and the needs of the private sector.
   

Background

1. The Strategic Growth Council (SGC). The SGC was established in 2008 by SB 732 (Steinberg, Chapter 729, Statutes of 2008) and is responsible for coordinating a variety of state programs and activities related to sustainable communities and the environment. The Council is comprised of ten members:
   
   1. The Director of OPR,
   2. The Secretary of the Natural Resources Agency (CNRA),
   3. The Secretary of Environmental Protection Agency (CalEPA),
   4. The Secretary of Transportation,
   5. The Secretary of Health and Human Services,
   6. The Secretary of Business, Consumer Services, and Housing,
   7. The Secretary of Department of Food and Agriculture,
   8. Three public members, one each being appointed by the Speaker of the Assembly, the Senate Committee on Rules, and the Governor.
      
2. Office of Planning and Research (OPR). OPR serves the governor and the administration as staff for long-range planning, research, policy development and legislative analysis. The office formulates plans regarding land use, climate change, urban expansion, infrastructure development and resource protection while acting as a liaison to local governments, small businesses and the military.
   
3. Mitigation vs. Adaptation. There are many state and local policies designed to reduce GHG emissions because deep and severe cuts in global GHG emissions are needed to avoid the most severe consequences of a changing climate. While these efforts are crucial, they will not be enough to stave off climate change entirely. Even if all GHG emissions ceased today, many impacts of climate change would still be unavoidable because the climate system changes slowly. Not only has climate change already occurred, it will continue to happen for generations to come, even under the best of circumstances.
   
   Adapting to the irreversibly changing climate is crucial for public health, environmental quality, natural resources protection, food stability, infrastructure maintenance, and withstanding severe weather events like heavier rains, heat waves, and drought.
   
4. Executive Orders Relating to State Agencies and Adaptation. In 2005, Governor Schwarzenegger issued Executive Order S-3-05, which established GHG emission reduction targets, created the CAT, and directed the Secretary of CalEPA to coordinate efforts to meet the targets with the heads of other state agencies. The Order required the Secretary to report back to the Governor and Legislature biannually on progress toward meeting the GHG targets, GHG impacts to California, as well as mitigation and adaptation plans.
   
   In 2008, Governor Schwarzenegger issued Executive Order S-13-08, which directed state agencies to plan for climate impacts specifically from sea level rise. It further directed the CNRA, through the CAT, to coordinate the California Climate Adaptation Strategy by June 2009, noting “California must begin now to adapt and build our resiliency to coming climate changes through a thoughtful and sensible approach with local, regional, state and federal government using the best available science.”
   
   In 2015, Governor Brown issued Executive Order B-30-15, which, in addition to setting GHG-related goals, directed the CNRA to update the Plan every three years and include vulnerabilities to climate change by sector and region, as specified, outline primary risks and priority actions regarding climate change impacts, and identification of lead agencies for each sector, which then report back to the CNRA on their actions taken. The Order further directed state agencies to take climate change into account in planning and investment decisions, guided by specified principles, and directs OPR to establish a technical, advisory group to help state agencies in their efforts.
   
5. California’s Adaptation Documents. The 2009 California Climate Adaptation Strategy is a statewide strategy that includes a summary of impacts from climate change, provides recommendations for adaptation strategies in seven sectors, and provides guidance for establishing adaptation and resiliency actions for the state.
   
   The 2014 Safeguarding California Plan is an update that augments adaptation strategies based on new climate science and risk management options.
   
   The 2012 California APG, prepared and promoted by OPR, the CNRA, and OES, was designed to provide guidance and support for local governments and regional collaborations in addressing the impacts of climate change. The guide consists of an overview document and three companion documents for use in defining local and regional impacts, understanding regional characteristics, and identifying adaptation strategies. The guide is meant to allow for flexibility in time, money, and effort available for adaptation across communities.
   
6. Legislative Hearings on Climate Adaptation. In 2015, the Senate Environmental Quality Committee conducted four informational and oversight hearings on climate adaptation in California. The first hearing was focused mainly on state efforts to adapt to climate change impacts. Subsequent hearings focused on regional climate adaptation efforts, with hearings being held in the bay area, central valley, and southern California.
   
   Testimony also underscored the current and worsening impacts from climate change and the need for coordinating knowledge, tools, and funding so that adaptation is approached efficiently and holistically across government levels and regions.
   
   Taken together, these hearings highlighted the broad, cross-sector nature of climate change, which has been called a “threat multiplier,” exacerbating existing public health and environmental quality concerns, particularly for already socially and economically disadvantaged communities. Prior to this, policy conversations about climate adaptation were largely limited to natural resources and infrastructure issues rather than environmental quality or public health issues.
   
   Finally, on April 11, 2018, the Senate Environmental Quality Committee held another hearing on the implementation of California climate adaptation policies. This hearing provided an update on how climate change impacts California’s environment, as well as state, regional, and local efforts to adapt to climate change. Ultimately, this hearing highlighted that a standalone agency or department of climate adaption and resiliency is what California needs in order to move past the piecemeal approach that state, regional, and local governments have taken on climate adaption and resiliency to date.
   
7. Environmental Quality and Public Health Impacts of a Changing Climate. Climate change is one of the foremost challenges of our time. Increases in carbon dioxide and other GHGs have led to increased average global temperatures, the increased geographic reach of vector-borne illnesses, diminished snow pack and sea ice, rising sea levels, decreased water quality and supply, reduced crop yields, and countless other impacts.
   
   According to the United States Environmental Protection Agency (US EPA), every 2°F increase in global average temperature is expected to result in 5-15% reductions in crop yields, 3-10% increases in rainfall during heavy precipitation events, and 200-400% increases in areas burned by wildfires in the western U.S. In California, higher temperatures and more extreme events, including heat waves, wildfires, floods, and droughts, will have a range of consequences for public health, air and water quality, infrastructure, agriculture, natural resources, safety and security, and the economy.
   
8. The energy sector’s role in climate change. California’s energy infrastructure is designed to cope with the state’s highly variable conditions and frequent disruptions from wildfires, storms and floods, but climate change is bringing more frequent and intense natural disasters. Changes in precipitation patterns, extreme events and sea-level rise have the potential to render hydropower less reliable and put energy infrastructure at risk of flooding. Increased temperatures, on the other hand, will decrease the efficiency of thermal power plants, transformers, transmission and distribution lines while simultaneously increasing electricity demand.
   
   California has largely phased out the coal power through SB 1368 (Perata, Chapter 598, Statutes of 2006), which prohibited utilities from entering into long-term financial commitments unless the specific types of power plants complied with an emissions performance standard (EPS). The EPS was set such that cleaner natural gas power plants were eligible, but coal power plants emissions were too high.
   
   These cleaner forms of energy have also been spurred by other policies, including the Renewables Portfolio Standard (RPS), which sets a target for renewable energy to make up 33% of California’s total energy mix by 2020 and 50% by 2030.
   
   Like other projects that aim to mitigate or adapt to California’s changing climate, financing for clean energy projects can be complicated and include a wide array of disparate sources including, but not limited to, state funding through agencies, local and federal funding, and private sources of capital.
   
9. SB 246 (Wieckowski, Chapter 606, Statutes of 2015). In order to address the environmental quality and public health impacts and challenges of climate change, Senator Wieckowski authored SB 246 (Wieckowski, Chapter 606, Statutes of 2015). This legislation established a framework for adaptation coordination among state agencies by creating a program within the state’s Office of Planning and Research to bring together state, regional, and local entities. The bill also created a central hub, or clearinghouse, of information and tools to help stakeholders efficiently address adaptation.
   
   The bill also formed an advisory council to provide scientific and technical expertise, and regional and local perspectives, to assist state agencies. The advisory council consists of 17 non state-affiliated and five agency-affiliated scientific and technical experts.

Comments

1. Purpose of Bill. According to the Author, “over the next decade, California will need to invest billions of dollars in clean energy and energy efficiency measures to meet the state’s long-term greenhouse gas emissions targets. Currently, there are numerous programs designed to support clean energy financing solutions placed across several agencies under different constitutional authorities. While all these programs may be successful on their own, the sheer number of programs and variety of managing entities makes coordination difficult, failing to unlock the full potential of our clean energy financing efforts. Furthermore, potential recipients of the funds, especially in low income and disadvantaged communities, need a place to go to find funding or financing programs that fit their needs. SB 1380 would create the Clean Energy Financing Clearinghouse, to coordinate across state agencies, engage with a variety of public and private entities, and engage with capital providers. By creating a centralized point of contact for interested parties, the state will be able to maximize its clean energy financing investments.”
   
2. California’s energy sector. As noted in the background, California’s energy sector is subject to an Emissions Performance Standard, the Renewables Portfolio Standard (RPS), the cap-and-trade program, and various other requirements. Despite the costs of policy-making, regulation, and enforcement, these programs have not cost the state billions to implement. The notion that the State of California will need to invest billions in clean energy to meet our state goals belies reality. As the Senate Environmental Quality Committee heard in an informational hearing on cap-and-trade last year, not only has California’s energy sector cleaned up remarkably in the last decade with most emissions coming from other sectors, the economists presenting at the hearing insisted that market-based compliance mechanisms were far cheaper and more important to achieving our climate change goals than other actions.
   
   Indeed, the evolution of the RPS itself is a testament to the fact that clean energy financing will play a relatively small role in achieving the state’s climate goals. Established in 2002 under SB 1078 (Sher, Chapter 516, Statutes of 2002), the RPS was initially set to require that utilities generate 20% of their energy from renewable sources by December 31, 2017. In light of the progress that was being made, SB 107 (Simitian, Chapter 464, Statutes of 2006) accelerated the RPS requirements to be 20% by 2010. Progress again exceeded expectations and SB X1-2 (Simitian, Chapter 1, Statutes of 2011) accelerated the RPS requirements to be 33% by 2020. Progress still exceeded expectations and SB 350 (De León, Chapter 547, Statutes of 2015) accelerated the RPS requirements to be 50% by 2030. Although SB 350 passed less than three years ago, there is already progress toward a 100% RPS in California.
   
   Given that, a question arises as to the cost-effectiveness of creating an entirely new office and clearinghouse to centralize clean-energy financing information when the state is pushing for cleaner, utility scale electricity generation.
   
3. What is clean energy? The definition of clean energy is an ever-evolving notion in California. A little more than a decade ago, coal-generated power in California made natural gas power plants look very clean. As the EPS phased out coal from California, gradations of clean began to emerge among natural gas power plants, with dirtier plants emitting as much as 1,100 lbs of carbon dioxide per megawatt-hour. Cleaner power plants were closer to 850 lbs of carbon dioxide per megawatt-hour.
   
   As technology continues to advance and the RPS marches forward, what counts as clean will be a moving target. The right definition for clean energy would simply be any technology that produces less carbon dioxide per megawatt-hour than the grid average, but the regulations and policies the state has in place negate the need for any definition.
   
   Therefore, the definition of clean energy needs to be struck from the bill.
   
4. A question of government structure. SB 1380 would establish the Clean Energy Financing Clearinghouse to be an office within the State Treasurer for the purposes of coordinating state agencies that offer grants or financing for clean energy projects. This is wholly inappropriate.
   
   State agencies do not work under the State Treasurer; they are coordinated and answer to a completely different statewide elected official: the Governor. The Legislature and Governor work together to implement programs in California. To put it simply: the Legislature passes bills and the Governor enacts the ones s/he signs. As such, it is not clear that the State Treasurer would be the appropriate place to maintain such a clearinghouse.
   
5. What is a clearinghouse? A clearinghouse is centralized place for information to be stored and distributed. As noted in the background, SB 246 directed OPR to create a clearinghouse to be a centralized source of information that provides available climate data to guide decision-makers at state, regional, and local levels when planning for and implementing climate adaptation projects to promote resiliency to climate change.
   
   Clean energy financing and program policy California has enacted is a direct result of the state’s desire to mitigate and adapt to climate change (with air quality cobenefits). Why would it be necessary or prudent to create a separate, duplicative clearinghouse within the office of the Treasurer for a small subset of financing information that already has a place in the climate adaption clearinghouse? Creating a duplicative clearinghouse would only add to the problem the author seeks to address by decentralizing climate mitigation and adaptation financing information.
   
   Therefore, amendments are needed to strike Section 2 from the bill and place the types of financing targeted by SB 1380 into the clearinghouse at OPR.
   

Related/Prior Legislation

SB 246 (Wieckowski, Chapter 606, Statutes of 2015) established the Climate Advisory Council, with a range of experience, to support OPR by providing scientific and technical support and to facilitate coordination among state, regional, and local agency efforts to adapt to the impacts of climate change.

AB 1482 (Gordon, Chapter 603, Statutes of 2015) requires the CNRA to regularly update the Safeguarding California Plan, requires state agencies to maximize specified objectives across sector vulnerabilities, and requires the SGC review activities and funding to meet the priorities of the Plan.

SB 379 (Jackson, Chapter 608, Statutes of 2015) requires local jurisdictions to include climate vulnerability and adaptation considerations in their general plan updates.

SB 1217 (Leno, 2014) would have required the CNRA and SGC to prepare a climate risk assessment and strategy evaluating California’s vulnerability and risk for climate change impacts and to identify and prioritize climate resiliency projects. SB 1217 died in the Assembly Appropriations Committee.

AB 2329 (Ruskin/Chesbro, 2010) would have enacted the CAT Act of 2010 to coordinate oversight of state agency efforts to meet GHG reduction targets, including development and implementation of mitigation and adaptation plans. AB 2329 failed on the Senate Floor.

SB 721 (Steinberg, 2009) was a reintroduction of SB 1760 (Perata, 2008), which was vetoed. SB 721 would also have required the CAT to biennially prepare and adopt a climate change impact mitigation and adaptation plan including specified information. SB 721 died in the Senate Appropriations Committee.

DOUBLE REFERRAL:

This measure is set to be heard in Senate Energy, Utilities and Communications Committee on April 17, 2018.

SOURCE:

Author

SUPPORT:

None on file

OPPOSITION:

None on file

-- END --

SENATE COMMITTEE ON ENERGY, UTILITIES AND COMMUNICATIONS

Senator Ben Hueso, Chair

2017 - 2018 Regular

Bill No: Hearing Date: 4/17/2018

SUBJECT:

DIGEST: This bill would establish the Clean Energy Financing Clearinghouse under the direction of the Treasurer to coordinate all government programs that invest in energy technologies advancing environmental protection and environmental justice goals, clarify information about these programs for market participants, and partner with entities to leverage private investments. The bill requires the Clean Energy Financing Clearinghouse to coordinate across other agencies and partner with market actors and capital providers.

ANALYSIS:

Existing law:

1. Establishes the California Alternative Energy and Advanced Transportation Financing Authority (CAEATFA) to work with public and private partners to provide financing solutions for projects that to promote the creation of California-based manufacturing, California-based jobs, advanced manufacturing, the reduction of greenhouse gases (GHG), or reductions in air and water pollution or energy consumption. (Public Resources Code §26000 et. seq.)
2. Establishes the Integrated Climate Adaptation and Resiliency Program in the Governor’s Office of Planning and Research (OPR) to coordinate state climate adaptation strategies with an emphasis on climate equity considerations and strategies that support greenhouse gas emissions reductions and adaptation efforts. (Public Resources Code §71354)
3. Requires OPR to coordinate with appropriate entities, including state, regional, or local agencies, to establish a clearinghouse for climate adaptation information for use by state, regional, and local entities. (Public Resources Code §71360)
4. Requires the California Energy Commission (CEC) to develop and publish a study on barriers for low-income customers to energy efficiency and weatherization investments, including those in disadvantaged communities, as well as recommendations on how to increase access to energy efficiency and weatherization investments to low-income customers. (Public Resources Code §25327)

This bill:

1. Establishes the Clean Energy Financing Clearinghouse under the direction of the State Treasurer to coordinate government programs that invest in energy technologies; Make information on these programs clear and accessible for market participants; and Partner with capital providers, investors, project developers, technology companies, and other market actors to catalyze more private investment in energy technologies that advance environmental protection and environmental justice goals.
2. Requires the Clearinghouse to consult and coordinate with the State Energy Resources Conservation and Development Commission (CEC), the California Infrastructure and Economic Development Bank (I-Bank), the Treasurer, the California Public Utilities Commission (CPUC), and other relevant governmental entities.
3. Requires the Clearinghouse to coordinate across agencies by doing the following:
   1. Create a central internal and external facing information resource to provide information about all the public resources and funding available to support environmental protection and environmental justice goals.
   2. Proactively identify opportunities to maximize public funds within a given energy technology project or market.
   3. Ensuring that programs supporting environmental protection and environmental justice are made accessible to low-income and disadvantaged communities.
4. Requires the Clearinghouse to partner with market actors by doing the following:
   1. Work with developers, technology companies, and large wholesale environmentally friendly energy deployment firms.
   2. Support the growth of women, minority, disabled veteran, and LGBT business enterprises.
   3. Ensuring that developers serving low-to-moderate income communities first access all available subsidies and rebates before selling environmentally friendly energy services.
   4. Solicit proposals for innovative business models and solutions to increase deployment of energy technologies that advance environmental protection and environmental justice goals that rely on public resources.
   5. Develop materials in multiple languages.
5. Requires the Clearinghouse to partner with capital providers by doing the following:
   1. Work with large capital providers to find efficient and innovative options for investment in energy technologies advancing environmental protection and environmental justice goals in California.
   2. Direct potential investors to appropriate governmental entities and programs so that those entities or programs collaborate to deploy capital.
   3. Support investment by directly facilitating transactions where a capital provider is able to provide financing to a market actor financing a large portfolio of underlying projects.
6. Requires the Clearinghouse to address commercial building efficiency as a priority market sector.
7. Requires the Clearinghouse to hire staff with relevant skills, work closely with markets, and operate flexibly to bridge gaps between the public and private sectors.
8. States legislative intent to provide a reliable source of funding for the Clearinghouse.

Background

Energy upgrade financing challenges. Energy efficiency projects face unique investment challenges. These challenges are increased for projects focusing on energy efficiency and clean energy solutions for disadvantaged and low-income communities. Projects in these communities generally require unique financing solutions because they face additional economic hurdles. Prior legislation, SB 350 (De León, Chapter 547, Statutes of 2015), required the CEC to develop a study examining the barriers that low-income and disadvantaged communities face for accessing clean energy and energy efficiency solutions. The bill also required the CEC to provide recommendations on how to address these barriers. In December 2016, the CEC adopted the SB 350 Barriers Study, which included recommendations regarding financing for energy efficiency projects benefiting low-income and disadvantaged communities. The report specifically recommends that the State Treasurer’s Office offer a credit enhancement pilot program to encourage financing for energy improvements for market-rate, low-income multifamily housing and commercial, community, and industrial buildings in disadvantaged communities. One option for implementing this recommendation includes establishing lines of credit or forms of capital that could be leveraged to support energy upgrades.

Other states and national organizations have implemented these financing methods to support energy efficiency projects. The National Association of State Energy Officials established the Warehouse for Energy Efficiency Loans and partnered with Citigroup and Renew Financial to create a low-cost financing mechanism for government and utility-sponsored efficiency loan programs that enabled consumers to borrow up to $20,000 for residential energy efficiency upgrades. In 2014, New York opened the New York Green Bank, which is a state-sponsored financing entity within the New York State Energy Research and Development Authority. The New York Green Bank partners with the private sector to increase financing for clean energy projects. In 2017, the New York Green Bank partnered with Citigroup to provide a warehouse loan of credit supporting residential energy efficiency loans.

Coordinating resources and information. The CEC’s SB 350 Barriers Study also recommended additional coordination to increase awareness about all the resources available for conducting significant upgrades to residential and multifamily buildings in low-income and disadvantaged communities. Multiple programs in several state agencies support energy efficiency and clean energy programs. Consumers may not be aware of all the options to combine incentives to make more significant upgrades to their properties. For example, owners of multifamily residential buildings may not be aware of all the weatherization and residential solar financing options available because these incentives are provided by different entities. Clearinghouses are a mechanism for centralizing and coordinating information about various resources that can be leveraged by consumers. In 2016, OPR launched the Integrated Climate Adaptation and Resiliency Program pursuant to SB 246 (Wieckowski, Chapter 606, Statutes of 2015). As part of the program, OPR is also creating a clearinghouse that centralizes information to help guide state, regional, and local decision makers as they plan for and implement climate adaptation projects.

Clearinghouse or financing program? This bill establishes a clearinghouse to coordinate information about programs that invest in clean energy and energy efficiency. However, this bill assigns duties to the clearinghouse that more closely match those of a program providing financing for various energy and environmental projects. For example, this bill requires the clearinghouse to directly facilitate financial transactions and work with investors to leverage different funding options. It is unclear how a clearinghouse could support financial transactions.

This bill establishes the clearinghouse at the State Treasurer’s Office. To the extent that the author intends to create a financing program, the Treasurer’s Office would be an appropriate entity to administer the program. The Treasurer’s Office currently administers CAEATFA, which already performs some of the duties this bill would assign to the clearinghouse. If this bill focuses on establishing a clearinghouse to centralize information about resources available, the clearinghouse could be established in other entities, including as an extension of OPR’s work on the State Clearinghouse and the Climate Adaptation Clearinghouse. However, OPR lacks the financing administration experience maintained by the Treasurer’s Office and would not be equipped to administer a clean energy financing authority. Should this bill be amended to change the agency administering the clearinghouse to an entity other than the Treasurer’s Office, those amendments may result in this bill being re-referred back to this committee.

Double referral. Should this bill be approved by this committee, it will be re-referred to the Senate Committee on Environmental Quality for their consideration.

Prior/Related Legislation

SB 246 (Wieckowski, Chapter 606, Statutes of 2015) created the Integrated Climate Adaptation and Resiliency Program within OPR. It also created a clearinghouse for climate adaptation information.

SB 350 (De León, Chapter 547, Statutes of 2015) the Clean Energy and Pollution Reduction Act of 2015, established new clean energy, clean air and greenhouse gas reduction goals. The bill also required the CEC to study low-income and disadvantaged communities’ barrier to clean energy and energy efficiency solutions.

SB 1121 (De León, 2014) would have enacted the California Climate Technology and Infrastructure Financing Act to create a financing program for eligible greenhouse gas (GHG) emissions reduction projects. The bill died on the Assembly Inactive File.

FISCAL EFFECT: Appropriation: Fiscal Com.: Local:

SUPPORT:

California Business Properties Association

California Manufacturers and Technology Association

Los Angeles Chamber of Commerce

North Bay Leadership Council

Orange County Business Council

San Francisco Chamber of Commerce

San Gabriel Valley Economic Partnership

Silicon Valley Leadership Group

OPPOSITION:

None received

ARGUMENTS IN SUPPORT: According to the author:

“Over the next decade, California will need to invest billions of dollars in clean energy and energy efficiency measures to meet the state’s long-term greenhouse gas emissions targets. Currently, there are numerous programs designed to support clean energy financing solutions placed across several agencies under different constitutional authorities. While all these programs may be successful on their own, the sheer number of programs and variety of managing entities makes coordination difficult, failing to unlock the full potential of our clean energy financing efforts. Furthermore, potential recipients of the funds, especially in low income and disadvantaged communities, need a place to go to find funding or financing programs that fit their needs. SB 1380 would create the Clean Energy Financing Clearinghouse, to coordinate across state agencies, engage with a variety of public and private entities, and engage with capital providers. By creating a centralized point of contact for interested parties, the state will be able to maximize its clean energy financing investments.”

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