SB 851: Self-generation incentive program.
- Session Year: 2023-2024
- House: Senate
- Latest Version Date: 2023-05-02
Current Status:
Failed
(2024-02-01: Returned to Secretary of Senate pursuant to Joint Rule 56.)
Introduced
In Committee
First Chamber
In Committee
Second Chamber
Enacted
What does this bill do?
This bill directs the California Public Utilities Commission to use legislative funds to provide incentives to residential households, including customers of public power utilities, for behind‑the‑meter solar panels paired with battery storage or for battery systems alone, and reserves 70% of funding for low‑income customers. It creates an equitable award system and a block‑grant option for groups that serve low‑income residents, limits mobile storage awards to 5% of funds, requires systems to emit no air pollution or greenhouse gases, and allows the commission to require participation in demand‑response programs to cut peak demand.
The summary is provided by generative AI which can make mistakes. For original language, please view the details in the table below.
Existing law requires the Public Utilities Commission to require the administration, until January 1, 2026, of a self-generation incentive program to increase the deployment of distributed generation resources and energy storage systems. Existing law requires the commission, in administering the program, to use funds that are appropriated by the Legislature, as provided, for the purpose of providing incentives to eligible residential customers who install behind-the-meter energy storage systems or solar photovoltaic systems paired with energy storage systems. Existing law requires the commission to allocate 70% of that funding for incentives to eligible-low income residential customers who install either new behind-the-meter solar photovoltaic systems paired with energy storage systems or new energy storage systems.
This bill instead would require, among other things, that the incentives described above for eligible residential households be used in addition to the self-generation incentive program. The bill would require the commission to establish a system to equitably award incentives and set incentive levels, as specified. To ensure equitable access to those incentives for eligible residential customers, the bill would require the commission to establish new technology guidelines, as specified. to support adoption of commercially available behind-the-meter solar photovoltaic systems and energy storage systems by eligible residential customers. The bill would also require the commission to establish a block grant structure and associated guidelines for California Indian tribes, community-based service providers, local publicly owned electric utilities, and community choice aggregators to apply on behalf of eligible low-income residential households. entities with demonstrated success in providing service to low-income populations in the state.
Under existing law, a violation of an order, decision, rule, direction, demand, or requirement of the commission is a crime.
Because a violation of an order or decision of the commission implementing the above-described requirements would be a crime, 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 a specified reason.
Existing law requires the Public Utilities Commission to require the administration, until January 1, 2026, of a self-generation incentive program to increase the deployment of distributed generation resources and energy storage systems. Existing law requires the commission, in administering the program, to use funds that are appropriated by the Legislature, as provided, for the purpose of providing incentives to eligible residential customers who install behind-the-meter energy storage systems or solar photovoltaic systems paired with energy storage systems. Existing law requires the commission to allocate 70% of that funding for incentives to eligible-low income residential customers who install either new behind-the-meter solar photovoltaic systems paired with energy storage systems or new energy storage systems.
This bill instead would require, among other things, that the incentives described above for eligible residential customers households be used in addition to the self-generation incentive program. The bill would require the commission to establish a system to equitably award incentives and set incentive levels, as specified. To ensure equitable access to those incentives for eligible residential customers, the bill would require the commission to establish new technology guidelines, as specified. The bill would also require the commission to establish a block grant structure and associated guidelines for California Indian tribes, community-based service providers, local publicly owned electric utilities, and community choice aggregators to apply on behalf of eligible low-income residential households.
Under existing law, a violation of an order, decision, rule, direction, demand, or requirement of the commission is a crime.
Because a violation of an order or decision of the commission implementing the above-described requirements would be a crime, 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 a specified reason.
Existing law requires the Public Utilities Commission to require the administration, until January 1, 2026, of a self-generation incentive program to increase the deployment of distributed generation resources and energy storage systems. Existing law requires the commission, in administering the program, to use funds that are appropriated by the Legislature, as provided, for the purpose of providing incentives to eligible residential customers who install behind-the-meter energy storage systems or solar photovoltaic systems paired with energy storage systems. Existing law requires the commission to allocate 70% of that funding for incentives to eligible-low income residential customers who install either new behind-the-meter solar photovoltaic systems paired with energy storage systems or new energy storage systems.
This bill instead would require, among other things, that the incentives described above for eligible residential customers be used in addition to the self-generation incentive program. The bill would require the commission to establish a system to equitably award incentives and set incentive levels, as specified. To ensure equitable access to those incentives for eligible residential customers, the bill would require the commission to establish new technology guidelines, as specified. The bill would also require the commission to establish a block grant structure and associated guidelines for California Indian tribes, community-based service providers, and community choice aggregators to apply on behalf of eligible low-income residential households.
Under existing law, a violation of an order, decision, rule, direction, demand, or requirement of the commission is a crime.
Because a violation of an order or decision of the commission implementing the above-described requirements would be a crime, 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 a specified reason.
Existing property tax law requires assessees to report change in ownership information to the assessor, as provided.This bill would make a nonsubstantive change to that provision.Existing property tax law requires assessees to report change in ownership information to the assessor, as provided.
This bill would make a nonsubstantive change to that provision.
(a)In addition to the self-generation incentive program pursuant to Section 379.6, the commission shall use funds appropriated by the Legislature for the purpose of providing incentives to eligible residential households, including those receiving service from a local publicly owned electric utility, as defined pursuant to Section 224.3, who install behind-the-meter energy storage systems or renewable generation solar photovoltaic systems paired with energy storage systems, as an integrated approach to increase individual customer resiliency, to reduce the electrical grids net peak demand, to reduce electric ratepayer costs, to reduce energy costs for residential households, and to reduce emissions of greenhouse gases and localized air pollution. The commission shall allocate funding pursuant to this section as follows:
(1)Seventy percent for incentives to eligible low-income residential customers who install either new onsite renewable generation behind-the-meter solar photovoltaic systems paired with energy storage systems or new energy storage systems.
(2)Thirty percent for incentives to residential customers who install new onsite behind-the-meter energy storage systems.
(b)The commission shall establish a system to equitably award incentives to support adoption of commercially available onsite renewable generation behind-the-meter solar photovoltaic systems and energy storage systems by eligible residential customers. In establishing the system, the commission shall set incentive levels and enable one or more of the following:
(1)Expanded capacity to achieve substantial reductions in emissions through building decarbonization, transportation electrification, and other fuel switching to reduce onsite fossil fuel use.(2)Increased resiliency and ability to isolate during periods of electrical system disruptions to mitigate the impact of outage events on individual households.(3)Automated or programmable load management to reduce net-peak energy consumption to reduce demand and support electrical grid reliability.(c)To ensure equitable access to funding provided under subdivision (a) to eligible residential customers, the commission shall also establish new technology guidelines to benefit renters, the access and functional needs population, as defined in Section 8593.3 of the Government Code, and low-income rural households lacking reliable electricity infrastructure access.(d)(c)The commission shall establish a block grant structure and associated guidelines for California Indian tribes, as defined in subdivision (c) of Section 8012 of the Health and Safety Code, community-based service providers, including nonprofit organizations providing renewable energy and energy storage installations to low- and moderate-income residents, local publicly owned electric utilities, as defined pursuant to Section 224.3, and community choice aggregators to apply on behalf of eligible low-income residential households. entities with demonstrated success in providing service to low-income populations in the state.
(e)(d)(1)Resources eligible for incentives under this section shall include mobile and nonmobile energy storage and onsite renewable or zero-carbon energy generation behind-the-meter solar photovoltaic systems that enables customer demand management, building decarbonization, managed charging of electric vehicles, and clean backup power. The commission shall award no more than 5 percent of funds for mobile energy storage.
(2)To receive an incentive under this section, any resource that generates electricity, or stores electricity from the electrical grid or another generation resource, solar photovoltaic system and energy storage system shall meet one of the following conditions: emit no air pollution or greenhouse gases, including when used to displace use of fossil-fueled portable generators.
(A)Be a renewable electrical generation facility as defined in Section 25741 of the Public Resources Code.(B)Be a zero-carbon resource pursuant to Section 454.53. (C)Be a mobile energy storage device that emits no air pollution or greenhouse gases when used to displace use of fossil-fueled portable generators.(f)(e)The commission shall consider requiring customers installing renewable generation solar photovoltaic systems paired with energy storage systems or new energy storage systems under this section and served on a standard contract or tariff pursuant to Section 2827.1 to participate in a demand response or peak load reduction program offered through the customers load-serving entity, including market-integrated supply-side demand response programs, to reduce net peak demand.
SEC. 3.SEC. 2.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.
(a)The Legislature finds and declares all of the following:
(1)Increased frequency of extreme weather events due to climate change is challenging grid reliability and has accelerated customer adoption of onsite renewable generation and energy storage technology through the self-generation incentive program established pursuant to Section 379.6 of the Public Utilities Code to increase customer resiliency to power outages.
(2)Continued state funding to support customer adoption of onsite renewable generation and energy storage systems will require a fresh and integrated approach to enable resiliency, building decarbonization, transportation electrification, and demand flexibility to improve overall grid reliability and resiliency.
(3)Existing program design barriers have also prevented equitable access to self-generation incentive program funds, in which low-income households account for only about 1 percent of program participants. Complex rules have also precluded the participation of the most vulnerable low-income households, such as low-income renters or rural households lacking adequate electricity infrastructure access.
(4)An equitable program to support the adoption of onsite renewable generation and energy storage systems will require a departure from the existing self-generation incentive program framework and the creation of a new program paradigm.
(b)It is the intent of the Legislature that General Fund moneys appropriated to implement Section 379.10 of the Public Utilities Code should require significant reconsideration of the past programmatic paradigm to achieve broad decarbonization and climate equity benefits.
SEC. 2.Section 379.10 of the Public Utilities Code is amended to read:379.10.(a)In addition to the self-generation incentive program pursuant to Section 379.6, the commission shall use funds appropriated by the Legislature for the purpose of providing incentives to eligible residential customers households, including those receiving service from a local publicly owned electric utility, as defined pursuant to Section 224.3, who install behind-the-meter energy storage systems or renewable generation paired with energy storage systems, as an integrated approach to increase individual customer resiliency, to reduce the electrical grids net peak demand, to reduce energy costs for residential households, and to reduce emissions of greenhouse gases and localized air pollution. The commission shall allocate funding pursuant to this section as follows:
(1)Seventy percent for incentives to eligible low-income residential customers who install either new onsite renewable generation paired with energy storage systems or new energy storage systems.
(2)Thirty percent for incentives to residential customers who install new onsite energy storage systems.
(b)The commission shall establish a system to equitably award incentives to support adoption of commercially available onsite renewable generation and energy storage systems by eligible residential customers. In establishing the system, the commission shall set incentive levels and enable one or more of the following:
(1)Expanded capacity to achieve substantial reductions in emissions through building decarbonization, transportation electrification, and other fuel switching to reduce onsite fossil fuel use.
(2)Increased resiliency and ability to isolate during periods of electrical system disruptions to mitigate the impact of outage events on individual households.
(3)Automated or programmable load management to reduce net-peak energy consumption to reduce demand and support electrical grid reliability.
(c)To ensure equitable access to funding provided under subdivision (a) to eligible residential customers, the commission shall also establish new technology guidelines to benefit renters, the access and functional needs population, as defined in Section 8593.3 of the Government Code, and low-income rural households lacking reliable electricity infrastructure access.
(d)The commission shall establish a block grant structure and associated guidelines for California Indian tribes, as defined in subdivision (c) of Section 8012 of the Health and Safety Code, community-based service providers, including nonprofit organizations providing renewable energy and energy storage installations to low- and moderate-income residents, local publicly owned electric utilities, as defined pursuant to Section 224.3, and community choice aggregators to apply on behalf of eligible low-income residential households.
(e)(1)Resources eligible for incentives under this section shall include mobile and nonmobile energy storage and onsite renewable or zero-carbon energy generation that enables customer demand management, building decarbonization, managed charging of electric vehicles, and clean backup power.
(2)To receive an incentive under this section, any resource that generates electricity, or stores electricity from the electrical grid or another generation resource, shall meet one of the following conditions:
(A)Be a renewable electrical generation facility as defined in Section 25741 of the Public Resources Code.
(B)Be a zero-carbon resource pursuant to Section 454.53.
(C)Be a mobile energy storage device that emits no air pollution or greenhouse gases when used to displace use of fossil-fueled portable generators.
(f)The commission shall consider requiring customers installing renewable generation paired with energy storage systems or new energy storage systems under this section and served on a standard contract or tariff pursuant to Section 2827.1 to participate in a demand response or peak load reduction program offered through the customers load-serving entity, including market-integrated supply-side demand response programs, to reduce net peak demand.
SEC. 3.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.
(a)The Legislature finds and declares all of the following:
(1)Increased frequency of extreme weather events due to climate change is challenging grid reliability and has accelerated customer adoption of onsite renewable generation and energy storage technology through the self-generation incentive program established pursuant to Section 379.6 of the Public Utilities Code to increase customer resiliency to power outages.
(2)Continued state funding to support customer adoption of onsite renewable generation and energy storage systems will require a fresh and integrated approach to enable resiliency, building decarbonization, transportation electrification, and demand flexibility to improve overall grid reliability and resiliency.
(3)Existing program design barriers have also prevented equitable access to self-generation incentive program funds, in which low-income households account for only about 1 percent of program participants. Complex rules have also precluded the participation of the most vulnerable low-income households, such as low-income renters or rural households lacking adequate electricity infrastructure access.
(4)An equitable program to support the adoption of onsite renewable generation and energy storage systems will require a departure from the existing self-generation incentive program framework and the creation of a new program paradigm.
(b)It is the intent of the Legislature that General Fund moneys appropriated to implement Section 379.10 of the Public Utilities Code should require significant reconsideration of the past programmatic paradigm to achieve broad decarbonization and climate equity benefits.
SEC. 2.Section 379.10 of the Public Utilities Code is amended to read:379.10.(a)In administering addition to the self-generation incentive program pursuant to Section 379.6, the commission shall use funds appropriated by the Legislature for the purpose of providing incentives to eligible residential customers, including those receiving service from a local publicly owned electric utility, as defined pursuant to Section 224.3, customers who install behind-the-meter energy storage systems or solar photovoltaic systems renewable generation paired with energy storage systems, as an integrated approach to increase individual customer resiliency, to reduce the electrical grids net peak demand, to reduce electric ratepayer costs, energy costs for residential households, and to reduce emissions of greenhouse gases and localized air pollution. The commission shall allocate funding pursuant to this section as follows:
(1)Seventy percent for incentives to eligible low-income residential customers who install either new behind-the-meter solar photovoltaic systems onsite renewable generation paired with energy storage systems or new energy storage systems.
(2)Thirty percent for incentives to residential customers who install new behind-the-meter onsite energy storage systems.
(b)The commission shall establish a system to equitably award incentives to support adoption of commercially available onsite renewable generation and energy storage systems by eligible residential customers. In establishing the system, the commission shall set incentive levels and enable one or more of the following:
(1)Expanded capacity to achieve substantial reductions in emissions through building decarbonization, transportation electrification, and other fuel switching to reduce onsite fossil fuel use.
(2)Increased resiliency and ability to isolate during periods of electrical system disruptions to mitigate the impact of outage events on individual households.
(3)Automated or programmable load management to reduce net-peak energy consumption to reduce demand and support electrical grid reliability.
(c)To ensure equitable access to funding provided under subdivision (a) to eligible residential customers, the commission shall also establish new technology guidelines to benefit renters, the access and functional needs population, as defined in Section 8593.3 of the Government Code, and low-income rural households lacking reliable electricity infrastructure access.
(d)The commission shall establish a block grant structure and associated guidelines for California Indian tribes, as defined in subdivision (c) of Section 8012 of the Health and Safety Code, community-based service providers, including nonprofit organizations providing renewable energy and energy storage installations to low- and moderate-income residents, and community choice aggregators to apply on behalf of eligible low-income residential households.
(e)(1)Resources eligible for incentives under this section shall include mobile and nonmobile energy storage and onsite renewable or zero-carbon energy generation that enables customer demand management, building decarbonization, managed charging of electric vehicles, and clean backup power.
(2)To receive an incentive under this section, any resource that generates electricity, or stores electricity from the electrical grid or another generation resource, shall meet one of the following conditions:
(A)Be a renewable electrical generation facility as defined in Section 25741 of the Public Resources Code.
(B)Be a zero-carbon resource pursuant to Section 454.53.
(C)Be a mobile energy storage device that emits no air pollution or greenhouse gases when used to displace use of fossil-fueled portable generators.
(b)(f)The commission shall consider requiring customers installing solar photovoltaic systems renewable generation paired with energy storage systems or new energy storage systems under this section and served on a standard contract or tariff pursuant Section 2827.1 to participate in a demand response or peak load reduction program offered through the customers load-serving entity, including market-integrated supply-side demand response programs, to reduce net peak demand.
SEC. 3.No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.
SECTION 1.Section 90 of the Revenue and Taxation Code is amended to read:90.An assessee shall report change in ownership information to the assessor as provided in Article 2.5 (commencing with Section 480) of Chapter 3 of Part 2.Assessees An assessee shall report change in ownership information to the assessor as provided in Article 2.5 (commencing with Section 480) of Chapter 3 of Part 2.
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Date
|
Status
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|---|---|
| Feb 1, 2024 | Returned to Secretary of Senate pursuant to Joint Rule 56. |
| May 18, 2023 | May 18 hearing: Held in committee and under submission. |
| May 16, 2023 | Set for hearing May 18. |
| May 15, 2023 | May 15 hearing: Placed on APPR suspense file. |
| May 5, 2023 | Set for hearing May 15. |
| May 2, 2023 | Read second time and amended. Re-referred to Com. on APPR. |
| May 1, 2023 | From committee: Do pass as amended and re-refer to Com. on APPR. (Ayes 16. Noes 0. Page 872.) (April 24). |
| Apr 12, 2023 | Set for hearing April 24. |
| Mar 30, 2023 | From committee with author's amendments. Read second time and amended. Re-referred to Com. on E., U. & C. |
| Mar 29, 2023 | Re-referred to Com. on E., U. & C. |
| Mar 20, 2023 | From committee with author's amendments. Read second time and amended. Re-referred to Com. on RLS. |
| Mar 1, 2023 | Referred to Com. on RLS. |
| Feb 21, 2023 | From printer. May be acted upon on or after March 20. |
| Feb 17, 2023 | Introduced. Read first time. To Com. on RLS. for assignment. To print. |
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Date
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Description
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Location
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Votes
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|---|---|---|---|---|
| May 15, 2023 | Placed on suspense file | Senate Standing Committee on Appropriations |
Passed |
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| Apr 24, 2023 | Do pass as amended, but first amend, and re-refer to the Committee on [Appropriations] | Senate Standing Committee on Energy, Utilities and Communications |
Passed |
This list shows positions taken on this bill by organizations on the date displayed, which is linked to the original source.
Positions by individuals are not included.
|
Organization
|
Position
|
Date
|
|---|---|---|
| California Community Economic Development Association | * Support | Apr 24, 2023 |
| California Municipal Utilities Association | * Support | Apr 24, 2023 |
| Central Coast Energy Services | * Support | Apr 24, 2023 |
| Community Resource Project | ** Support | |
| Goal Zero | ** Support | |
| Goal Zero | * Support | Apr 24, 2023 |
| Heart of America | ** Support | |
| Nrg Energy | * Support | Apr 24, 2023 |
| Pacific Asian Consortium in Employment | ** Support | |
| Pueblo Unido CDC | ** Support | |
| San Francisco Peninsula Energy Services | ** Support |
SENATE COMMITTEE ON
Senator Anthony Portantino, Chair
2023 - 2024 Regular Session
SB 851 (Stern) - Self-generation incentive program
Version: | Policy Vote: |
Urgency: | Mandate: |
Hearing Date: | Consultant: |
Bill Summary:
This bill would make changes to the self-generation incentive program (SGIP) and funding adopted in last year’s budget to support adoption of commercially available behind-the-meter solar photovoltaic systems and energy storage systems by eligible residential customers, among other things.
Fiscal Impact:
- The California Public Utilities Commission (CPUC) estimates one-time costs of about $20 million (ratepayer funds) to establish the block grant program. Of this amount, $17 million would be grant funding. In addition, the CPUC estimates ongoing costs of $1.8 million annually (ratepayer funds) to administer and oversee the block grant program, establish a system to equitably award incentives as specified, and incorporate mobile storage into SGIP as an eligible incentive category, among other things.
Background:
Self-Generation Incentive Program (SGIP). SGIP was established by statute, AB 970 (Ducheny, Chapter 329, Statutes of 2000), and provided incentives to support existing, new, and emerging distributed energy resources (DER). SGIP provides rebates for qualifying DER systems installed on the customer's side of the utility meter and sized no larger than what is needed to meet on-site energy needs. Qualifying technologies include wind turbines, waste heat to power technologies, pressure reduction turbines, internal combustion engines, microturbines, gas turbines, fuel cells, and advanced energy storage systems. SGIP has evolved since 2001, with eligibility requirements, program administration, and incentive levels all changing over time in response to California’s evolving energy landscape. While SGIP has provided incentives for a variety of DER, more recently, the program has largely focused on energy storage systems.
SGIP funding. Existing law authorizes the CPUC to direct electric investor-owned utilities (IOUs) to collect $166 million annually from ratepayers through 2024 to fund SGIP and requires the CPUC to administer the program until January 1, 2026. As a result, the program is only available to customers located in the service territories of the state’s three largest electric IOUs.
SGIP projects. SGIP allocates 85 percent of the funds to energy storage technologies. Based on the 2019 evaluation (published in August 2021), by the end of 2019, the SGIP had provided incentives to 8,875 energy storage systems representing almost 187 megawatts (MW) of rebated capacity. Most energy storage systems rebated by SGIP are installed in residential settings (8,061 of 8,875 or slightly more than 90 percent), followed by a variety of nonresidential facilities, including schools and industrial facilities.
2022 Budget includes funding for solar and energy storage DER. The state budget adopted for 2022-23 includes funding for solar plus storage incentives via SGIP at the CPUC. The budget approved funding for solar and storage projects, with 70 percent of the $970 million for residential low-income, Tribal, and disadvantaged communities. The remaining 30 percent of funds would be available for general market incentives for battery storage system deployment. The budget provides that deployment of these DER is intended to help improve electric service reliability and resiliency for low-income residential customers who may experience power outages caused by wildfires or others events, contribute to grid reliability, reduce electric sector GHG emissions, create new clean energy jobs, reduce low-income residential customers' electric bills, and create new avenues for Tribes and underrepresented communities to access and benefit from clean energy resources.
Proposed Law:
This bill would make changes to SGIP and funding adopted in last year’s budget to support adoption of commercially available behind-the-meter solar photovoltaic systems and energy storage systems by eligible residential customers. Specifically, this bill would:
- Require the CPUC to use funds appropriated by the Legislature for the purpose of providing incentives to eligible residential households, including those receiving service from a local publicly owned electric utility, who install behind-the-meter energy storage systems or solar photovoltaic systems paired with energy storage systems, as an integrated approach to increase individual customer resiliency, to reduce the electrical grid’s net peak demand, to reduce electric ratepayer costs, to reduce energy costs for residential households, and to reduce emissions of greenhouse gases and localized air pollution.
- Require the CPUC to establish a system to equitably award incentives to support adoption of commercially available behind-the-meter solar photovoltaic systems and energy storage systems by eligible residential customers.
- Require the CPUC to establish a block grant structure and associated guidelines for entities with demonstrated success in providing service to low-income populations in the state.
- Provide that resources eligible for incentives include mobile and nonmobile energy storage and behind-the-meter solar photovoltaic systems, as specified.
- Prohibit the CPUC from awarding more than 5 percent of funds for mobile energy storage.
Related Legislation:
AB 2667 (Friedman, 2022) would have established a program to provide incentives for commercially available DER, specifically behind-the-meter energy storage systems or self-generation systems paired with energy storage systems. The bill died on the Senate Floor.
AB 209 (Committee on Budget, Chapter 251, Statutes of 2022) established a program within SGIP to provide incentives to eligible residential customers, including those in publicly owned utilities, to support behind-the-meter solar photovoltaic systems and energy storage systems, as specified.
Staff Comments: The Governor’s January budget proposed reducing the overall amount of SGIP to $679 million and target it only for low-income residential customers. The May Revise may propose additional cuts to the program. It is currently unclear how much, if any, funding will ultimately be available for the program this bill would establish.
-- END --
SENATE COMMITTEE ON ENERGY, UTILITIES AND COMMUNICATIONS
Senator Steven Bradford, Chair
2023 - 2024 Regular
Bill No: Hearing Date: 4/24/2023
Author: | |||
Version: | Amended | ||
Urgency: | Fiscal: | ||
Consultant: | |||
SUBJECT:
DIGEST: This bill makes changes to the Self-generation incentive program (SGIP) and funding adopted in last year’s budget to provide incentives for residential solar plus storage energy projects.
ANALYSIS:
Existing law:
- Requires the California Public Utilities Commission (CPUC) to require the administration, until January 1, 2026, of a SGIP to increase the deployment of distributed generation resources and energy storage systems. Requires the CPUC in administering the program, to use funds that are appropriated by the Legislature, as provided, for the purpose of providing incentives to eligible residential customers who install behind-the-meter energy storage systems or solar photovoltaic systems paired with energy storage systems. Requires the CPUC to allocate 70 percent of that funding for incentives to eligible-low income residential customers who install either new behind-the-meter solar photovoltaic systems paired with energy storage systems or new energy storage systems. (Public Utilities Code §379.10)
This bill:
- Requires, that the incentives described above for eligible residential households be used in addition to SGIP.
- Requires the CPUC to establish a system to equitably award incentives and set incentive levels, as specified.
- Requires the CPUC to establish new technology guidelines.
- Requires the CPUC to establish a block grant structure and associated guidelines for California Indian tribes, community-based service providers, local publicly owned electric utilities, and community choice aggregators to apply on behalf of eligible low-income residential households.
Background
Self-Generation Incentive Program (SGIP). SGIP was established by statute, AB 970 (Ducheny, Chapter 329, Statutes of 2000), and provided incentives to support existing, new, and emerging distributed energy resources (DER). SGIP provides rebates for qualifying DER systems installed on the customer's side of the utility meter and sized no larger than what is needed to meet on-site energy needs. Qualifying technologies include wind turbines, waste heat to power technologies, pressure reduction turbines, internal combustion engines, microturbines, gas turbines, fuel cells, and advanced energy storage systems. SGIP has evolved since 2001, with eligibility requirements, program administration, and incentive levels all changing over time in response to California’s evolving energy landscape. While SGIP has provided incentives for a variety of DER, more recently, the program has largely focused on energy storage systems. The program has several goals:
- Environment – reduce greenhouse gases (GHG), integrate renewables and reduce criteria air pollutants;
- Grid support – reduce or shift peak demand, reduce grid costs, provide ancillary services;
- Market transformation – support technologies that have the potential to thrive in future years without rebates; and
- Maximize ratepayer value and ensure equitable distribution of costs and benefits.
SGIP funding. Existing law authorizes the CPUC to direct electric investor-owned utilities (IOUs) to collect $166 million annually from ratepayers through 2024 to fund SGIP and requires the CPUC to administer the program until January 1, 2026. As a result, the program is only available to customers located in the service territories of the state’s three largest electric IOUs.
SGIP projects. SGIP allocates 85 percent of the funds to energy storage technologies. Based on the 2019 evaluation (published in August 2021), by the end of 2019, the SGIP had provided incentives to 8,875 energy storage systems representing almost 187 megawatts (MW) of rebated capacity. Most energy storage systems rebated by SGIP are installed in residential settings (8,061 of 8,875 or slightly more than 90 percent), followed by a variety of nonresidential facilities, including schools and industrial facilities.
2022 Budget includes funding for solar and energy storage DER. The state budget adopted for 2022-23 includes funding for solar plus storage incentives via SGIP at the CPUC. The budget approved funding for solar and storage projects, with 70 percent of the $970 million for residential low-income, Tribal, and disadvantaged communities. The remaining 30 percent of funds would be available for general market incentives for battery storage system deployment. The budget provides that deployment of these DER is intended to help improve electric service reliability and resiliency for low-income residential customers who may experience power outages caused by wildfires or others events, contribute to grid reliability, reduce electric sector GHG emissions, create new clean energy jobs, reduce low-income residential customers' electric bills, and create new avenues for Tribes and underrepresented communities to access and benefit from clean energy resources.
Comments
This bill makes changes to the budget language adopted last year for the solar plus storage residential incentives. The Governor’s January budget proposes reducing the overall amount of the program to $679 million for the program and target it only low-income residential customers. The May Revise may propose additional cuts to the program. Given the uncertainty on the funding and that the CPUC intended to implement the program in July 1, 2023, it may be that train has left the station on additional changes to the program. However, should the author and supporters wish to pursue additional changes to the program, they may be best suited by limiting the number of changes. In this regard, the author and committee may wish to amend this bill to:
- Restore language referencing “behind-the-meter solar photovoltaic systems,” instead of renewable generation.
- Delete the findings and declarations.
- Restore the language referencing “electric ratepayer costs” among the goals of the program.
- Delete the references that the CPUC must “set incentive levels and enable one or more of the following:…”
- Delete the requirements for new technology guidelines.
- Amend the types of technology in Public Utilities Code §379.10 (e) (1) and (2) to solar plus storage, and allow for no more than five percent of the funds to be used for mobile solar plus storage.
- Amend the language related to block grant to only entities with demonstrated success in providing service to low-income populations.
Prior/Related Legislation
AB 2667 (Friedman, 2022) would have established a program to provide incentives for commercially available DER, specifically behind-the-meter energy storage systems or self-generation systems paired with energy storage systems. The bill died on the Senate Floor.
AB 209 (Committee on Budget, Chapter 251, Statutes of 2022) established a program within SGIP to provide incentives to eligible residential customers, including those in publicly owned utilities, to support behind-the-meter solar photovoltaic systems and energy storage systems, as specified.
FISCAL EFFECT: Appropriation: Fiscal Com.: Local:
SUPPORT:
California Community Economic Development Association, Co-sponsor
Goal Zero, Co-sponsor
California Municipal Utilities Association
Central Coast Energy Services
Community Resource Project
Heart of America
Pacific Asian Consortium in Employment
Pueblo Unido CDC
San Francisco Peninsula Energy Services
OPPOSITION:
None received
ARGUMENTS IN SUPPORT: According to the author:
At a time of rapidly changing climate, increased extreme weather events, and global geopolitical and economic uncertainty, California can leverage its resources to increase resiliency of our society without leaving behind the most vulnerable, by helping households decarbonize, manage their energy use, and mitigate the debilitating impact of grid outage events.
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Discussed in Hearing
5MIN
Senate Standing Committee on Energy, Utilities and Communications
Bill Author
Bill Co-Author(s):