Bill Text: CA AB3107 | 2023-2024 | Regular Session | Amended
Bill Title: State Energy Resources Conservation and Development Commission: microgrids: study.
Spectrum: Partisan Bill (Democrat 1-0)
Status: (Introduced) 2024-05-16 - In committee: Held under submission. [AB3107 Detail]
Download: California-2023-AB3107-Amended.html
|
Amended
IN
Assembly
April 16, 2024 |
|
Amended
IN
Assembly
March 18, 2024 |
| Introduced by Assembly Member Connolly |
February 16, 2024 |
LEGISLATIVE COUNSEL'S DIGEST
(1)Existing law vests the Public Utilities Commission (PUC) with regulatory authority over public utilities, including electrical corporations. Existing law defines “electrical corporation” for purposes of the Public Utilities Act to include every corporation or person owning, controlling, operating, or managing any electric plant for compensation within this state, except as provided.
This bill would revise and recast the definition of “electrical corporation” to, among other things, eliminate certain existing exceptions to the definition of “electrical corporation,” thereby expanding the scope of that term and the entities over which the PUC has regulatory authority. The bill would additionally exempt from that definition a corporation
or person employing one or more distributed energy resources, as defined, that has the capacity to be coupled with one or more energy storage systems for the generation of electricity primarily for specified uses. The bill would also exempt from the definition of “electrical corporation” a microgrid, as defined, that primarily serves the included load of the microgrid, as provided. The bill would also make various conforming changes.
(2)Existing law requires the PUC, in consultation with the State Energy Resources Conservation and Development Commission (Energy Commission) and the Independent System Operator, to take specified actions by December 1, 2020, to facilitate the commercialization of microgrids for distribution customers of large electrical corporations.
The bill would require the PUC to retain jurisdiction over the interconnection of a microgrid to the distribution system of a large
electrical corporation, as defined. The bill would also authorize the Energy Commission to develop safety standards for microgrids and to issue optional guidelines for the governance and oversight of microgrids to local governments, as provided.
(3)Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the PUC is a crime.
Because certain of the above provisions would be part of the act and a violation of a PUC action implementing this bill’s requirements would be a crime, the 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.
Digest Key
Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program:Bill Text
The people of the State of California do enact as follows:
SECTION 1.
Section 8373 is added to the Public Utilities Code, immediately following Section 8372, to read:8373.
(a) The Energy Commission shall conduct a study on the benefits of microgrids for local governments and communities and shall, on or before January 1, 2027, submit a report on that study to the Legislature.(a)(1)“Public utility” includes every common carrier, toll bridge corporation, pipeline corporation, gas corporation, electrical corporation, telephone corporation, telegraph corporation, water corporation, sewer system corporation, and heat corporation, where the service is performed for, or the commodity is delivered to, the public or any portion thereof.
(2)A provider of last resort, as defined in Section 387, that is providing service pursuant to Article 8.5 (commencing with Section 387) of Chapter 2.3 is a public utility subject to the jurisdiction, control, and regulation of the commission and the provisions of this part regarding providing that service.
(b)Whenever
any common carrier, toll bridge corporation, pipeline corporation, gas corporation, electrical corporation, telephone corporation, telegraph corporation, water corporation, sewer system corporation, or heat corporation performs a service for, or delivers a commodity to, the public or any portion thereof for which any compensation or payment whatsoever is received, that common carrier, toll bridge corporation, pipeline corporation, gas corporation, electrical corporation, telephone corporation, telegraph corporation, water corporation, sewer system corporation, or heat corporation is a public utility subject to the jurisdiction, control, and regulation of the commission and this part.
(c)When any person or corporation performs any service for, or delivers any commodity to, any person, private corporation, municipality, or other political subdivision of the state, that in turn either directly or indirectly, mediately or immediately, performs that service for, or delivers that commodity to, the public or any portion thereof, that person or corporation is a public utility subject to the jurisdiction, control, and regulation of the commission and this part.
(d)Ownership or operation of a facility that employs cogeneration technology or produces power from other than a conventional power source or the ownership or operation of a facility
that employs landfill gas technology does not make a corporation or person a public utility within the meaning of this section solely because of the ownership or operation of that facility.
(e)Any corporation or person engaged directly or indirectly in developing, producing, transmitting, distributing, delivering, or selling any form of heat derived from geothermal or solar resources or from cogeneration technology to any privately owned or publicly owned public utility, or to the public or any portion thereof, is not a public utility within the meaning of this section solely by reason of engaging in any of those activities.
(f)The ownership or operation of a facility that sells compressed natural gas or hydrogen at retail to the public for use only as a motor vehicle fuel, and the selling of compressed natural gas or hydrogen at retail
from that facility to the public for use only as a motor vehicle fuel, does not make the corporation or person a public utility within the meaning of this section solely because of that ownership, operation, or sale.
(g)Ownership or operation of a facility that is an exempt wholesale generator, as defined in the Public Utility Holding Company Act of 2005 (42 U.S.C. Sec. 16451(6)), does not make a corporation or person a public utility within the meaning of this section, solely due to the ownership or operation of that facility.
(h)The ownership, control, operation, or management of an electric plant used for direct transactions or participation directly or indirectly in direct transactions, as permitted by subdivision (b) of Section 365, sales into a market established and operated by the Independent System Operator or any other wholesale electricity market, or the use or sale
as permitted under
subdivision (b) of Section 218, shall not make a corporation or person a public utility within the meaning of this section solely because of that ownership, participation, or sale.
(i)The ownership, control, operation, or management of a facility that supplies electricity to the public only for use to charge light duty plug-in electric vehicles does not make the corporation or person a public utility within the meaning of this section solely because of that ownership, control, operation, or management. For purposes of this subdivision, “light duty plug-in electric vehicles” includes light duty battery electric and plug-in hybrid electric vehicles. This subdivision does not affect the commission’s authority under Section 454 or 740.2 or any other applicable statute.
(a)“Electrical corporation” includes every corporation or person owning, controlling, operating, or managing any electric plant for compensation within this state, except where electricity is generated on or distributed by the producer through private property primarily for its own use or the use of its tenants and not for sale or transmission to others.
(b)“Electrical corporation” does not include a corporation or person
generating electricity solely for any one or more of the following purposes:
(1)Employing one or more distributed energy resources, as defined in Section 8370, that have the capacity to be coupled with one or more energy storage systems for the generation of electricity primarily for its own use, the use of its tenants, the use of the members of a cooperative or condominium, or use on immediately adjacent properties.
(2)Employing cogeneration technology, landfill gas technology, or digester gas technology to generate electricity for sale or transmission to an electrical corporation or state or local public agency, if the sale or transmission of the electricity service to a retail customer is provided through the transmission system of the local publicly owned electric utility or electrical corporation that serves that retail customer.
(3)(A)Operating a microgrid, as
defined in Section 8370, that primarily serves the included load of the microgrid.
(B)A corporation or person operating a microgrid that is exempt from the definition of an electrical corporation pursuant to subparagraph (A) shall do both of the following:
(i)Obtain all necessary approvals from local authorities having jurisdiction to cross rights-of-way in order to provide electrical service to customers.
(ii)Comply with all other local and state building and safety codes and standards.
(c)“Electrical corporation” does not include an independent solar energy producer, as defined in Article 3 (commencing with Section 2868) of Chapter 9 of Part 2.
(a)“Electric service provider” means an entity that offers electrical service to customers within the service territory of an electrical corporation and includes the unregulated affiliates and subsidiaries of an electrical corporation.
(b)“Electric service provider” does not include an entity that offers electrical service primarily to service customer load consistent with subdivision (b) of Section 218, and does not include an electrical corporation or a public agency that offers electrical service to residential and small
commercial customers within its jurisdiction, or within the service territory of a local publicly owned electric utility.
(c)“Electric service provider” does not include an independent solar energy producer, as defined in Article 3 (commencing with Section 2868) of Chapter 9 of Part 2.
(a)As used in this section, “electric service provider” means an entity that offers electrical service to customers within the service territory of an electrical corporation, but does not include an electrical corporation, as defined in Section 218, does not include an entity that offers electrical service primarily to serve customer load consistent with subdivision (b) of Section 218, and does not include a public agency that offers electrical service to residential and small commercial customers within its jurisdiction, or within the service territory of a local publicly owned electric
utility. “Electric service provider” includes the unregulated affiliates and subsidiaries of an electrical corporation, as defined in Section 218.
(b)Each electric service provider shall register with the commission. As a precondition to registration, the electric service provider shall provide, under oath, declaration, or affidavit, all of the following information to the commission:
(1)Legal name and any other names under which the electric service provider is doing business in California.
(2)Current telephone number.
(3)Current address.
(4)Agent for service of process.
(5)State and date of incorporation, if any.
(6)Number for a customer contact representative, or other personnel for receiving customer inquiries.
(7)Brief description of the nature of the service being provided.
(8)Disclosure of any civil, criminal, or regulatory sanctions or penalties imposed within the 10 years immediately prior to registration, against the company or any owner, partner, officer, or director of the company pursuant to any state or federal consumer protection law or regulation, and of any felony convictions of any kind against the company or any owner, partner, officer, or director of the company. In addition, each electric service provider shall furnish the commission with fingerprints for those owners, partners, officers, and managers of the electric service provider specified by any commission decision applicable to all electric service
providers. The commission shall submit completed fingerprint cards to the Department of Justice. Those fingerprints shall be available for use by the Department of Justice and the Department of Justice may transmit the fingerprints to the Federal Bureau of Investigation for a national criminal history record check. The commission may use information obtained from a national criminal history record check conducted pursuant to this section to determine an electric service provider’s eligibility for registration.
(9)Proof of financial viability. The commission shall develop uniform standards for determining financial viability and shall publish those standards for public comment no later than March 31, 1998. In determining the financial viability of the electric service provider, the commission shall take into account the number of customers the potential registrant expects to serve, the number of kilowatthours of electricity it expects to
provide, and any other appropriate criteria to ensure that residential and small commercial customers have adequate recourse in the event of fraud or nonperformance.
(10)Proof of technical and operational ability. The commission shall develop uniform standards for determining technical and operational capacity and shall publish those standards for public comment no later than March 31, 1998.
(c)Any registration filing approved by the commission prior to the effective date of this section which does not comply in all respects with the requirements of subdivision (a) of Section 394 shall nevertheless continue in force and effect so long as within 90 days of the effective date of this section the electric service provider undertakes to supplement its registration filing to the satisfaction of the commission. Any registration that is not supplemented by the required information
within the time set forth in this subdivision shall be suspended by the commission and shall not be reinstated until the commission has found the registration to be in full compliance with subdivision (a) of Section 394.
(d)Any public agency offering aggregation services as provided for in Section 366 solely to retail electric customers within its jurisdiction that has registered with the commission prior to the enactment of this section may voluntarily withdraw its registration to the extent that it is exempted from registration under this chapter.
(e)Before reentering the market, electric service providers whose registration has been revoked shall file a formal application with the commission that satisfies the requirements set forth in Section 394.1 and demonstrates the fitness and ability of the electric service provider to comply with all applicable rules of the
commission.
(f)Registration with the commission is an exercise of the licensing function of the commission, and does not constitute regulation of the rates or terms and conditions of service offered by electric service providers. Nothing in this part authorizes the commission to regulate the rates or terms and conditions of service offered by electric service providers.
For purposes of this article, the following terms have the following meanings:
(a)“Conduit hydroelectric facility” means a facility for the generation of electricity that uses only the hydroelectric potential of an existing pipe, ditch, flume, siphon, tunnel, canal, or other manmade conduit that is operated to distribute water for a beneficial use.
(b)“Balancing authority” means the responsible entity that integrates resource plans ahead of time, maintains load-interchange generation balance within a balancing authority area, and supports interconnection frequency in real time.
(c)“Balancing authority area” means the collection of generation,
transmission, and loads within the metered boundaries of the area within which the balancing authority maintains the electrical load-resource balance.
(d)“California balancing authority” is a balancing authority with control over a balancing authority area primarily located in this state and operating for retail sellers and local publicly owned electric utilities subject to the requirements of this article and includes the Independent System Operator (ISO) and a local publicly owned electric utility operating a transmission grid that is not under the operational control of the ISO. A California balancing authority is responsible for the operation of the transmission grid within its metered boundaries that is not limited by the political boundaries
of the State of California.
(e)“Eligible renewable energy resource” means an electrical generating facility that meets the definition of a “renewable electrical generation facility” in Section 25741 of the Public Resources Code, subject to the following:
(1)(A)An existing small hydroelectric generation facility of 30 megawatts or less shall be eligible only if a retail seller or local publicly owned electric utility procured the electricity from the facility as of December 31, 2005. A new hydroelectric facility that commences generation of electricity after December 31, 2005, is not an eligible renewable energy resource if it will cause an adverse impact on instream beneficial uses or cause a change in the volume or timing of streamflow.
(B)Notwithstanding subparagraph (A), a conduit
hydroelectric facility of 30 megawatts or less that commenced operation before January 1, 2006, is an eligible renewable energy resource. A conduit hydroelectric facility of 30 megawatts or less that commences operation after December 31, 2005, is an eligible renewable energy resource so long as it does not cause an adverse impact on instream beneficial uses or cause a change in the volume or timing of streamflow.
(C)A facility approved by the governing board of a local publicly owned electric utility before June 1, 2010, for procurement to satisfy renewable energy procurement obligations adopted pursuant to former Section 387, shall be certified as an eligible renewable energy resource by the Energy Commission pursuant to this article, if the
facility is a “renewable electrical generation facility” as defined in Section 25741 of the Public Resources Code.
(D)(i)A small hydroelectric generation unit with a nameplate capacity not exceeding 40 megawatts that is operated as part of a water supply or conveyance system is an eligible renewable energy resource only for the retail seller or local publicly owned electric utility that procured the electricity from the unit as of December 31, 2005. No unit shall be eligible pursuant to this subparagraph if an application for certification is submitted to the Energy Commission after January 1, 2013. Only one retail seller or local publicly owned electric utility shall be deemed to have procured electricity from a given unit as of December 31, 2005.
(ii)Notwithstanding clause (i), a local publicly owned electric utility that meets the criteria of
subdivision (j) of Section 399.30 may sell to another local publicly owned electric utility electricity from small hydroelectric generation units that qualify as eligible renewable energy resources under clause (i), and that electricity may be used by the local publicly owned electric utility that purchased the electricity to meet its renewables portfolio standard procurement requirements. The total of all those sales from the utility shall be no greater than 100,000 megawatthours of electricity.
(iii)The amendments made to this subdivision by the act adding this subparagraph are intended to clarify existing law and apply from December 10, 2011.
(2)(A)A facility engaged in the combustion of municipal solid waste shall not be considered an eligible renewable energy resource.
(B)Subparagraph
(A) does not apply to generation before January 1, 2017, from a facility located in Stanislaus County that was operational before September 26, 1996.
(f)“Procure” means to acquire through ownership or contract.
(g)“Procurement entity” means any person or corporation authorized by the commission to enter into contracts to procure eligible renewable energy resources on behalf of customers of a retail seller pursuant to subdivision (f) of Section 399.13.
(h)(1)“Renewable energy credit” means a certificate of proof associated with the generation of electricity from an eligible renewable energy
resource, issued through the accounting system established by the Energy Commission pursuant to Section 399.25, that one unit of electricity was generated and delivered by an eligible renewable energy resource.
(2)“Renewable energy credit” includes all renewable and environmental attributes associated with the production of electricity from the eligible renewable energy resource, except for an emissions reduction credit issued pursuant to Section 40709 of the Health and Safety Code and any credits or payments associated with the reduction of solid waste and treatment benefits created by the utilization of biomass or biogas fuels.
(3)(A)Electricity generated by an eligible renewable energy resource attributable to the use of nonrenewable fuels, beyond a de minimis quantity used to generate electricity in the same process through which the facility converts
renewable fuel to electricity, shall not result in the creation of a renewable energy credit. The Energy Commission shall set the de minimis quantity of nonrenewable fuels for each renewable energy technology at a level of no more than 2 percent of the total quantity of fuel used by the technology to generate electricity. The Energy Commission may adjust the de minimis quantity for an individual facility, up to a maximum of 5 percent, if it finds that all of the following conditions are met:
(i)The facility demonstrates that the higher quantity of nonrenewable fuel will lead to an increase in generation from the eligible renewable energy facility that is significantly greater than generation from the nonrenewable fuel alone.
(ii)The facility demonstrates that the higher quantity of nonrenewable fuels will reduce the variability of its electrical output in a manner that results
in net environmental benefits to the state.
(iii)The higher quantity of nonrenewable fuel is limited to either natural gas or hydrogen derived by reformation of a fossil fuel.
(B)Electricity generated by a small hydroelectric generation facility shall not result in the creation of a renewable energy credit unless the facility meets the requirements of subparagraph (A) or (D) of paragraph (1) of subdivision (e).
(C)Electricity generated by a conduit hydroelectric generation facility shall not result in the creation of a renewable energy credit unless the facility meets the requirements of subparagraph (B) of paragraph (1) of subdivision (e).
(D)Electricity generated by a facility engaged in the combustion of municipal solid waste shall not result in
the creation of a renewable energy credit. This subparagraph does not apply to renewable energy credits that were generated before January 1, 2017, by a facility engaged in the combustion of municipal solid waste located in Stanislaus County that was operational before September 26, 1996, and sold pursuant to contacts entered into before January 1, 2017.
(i)“Renewables portfolio standard” means the specified percentage of electricity generated by eligible renewable energy resources that a retail seller or a local publicly owned electric utility is required to procure pursuant to this article.
(j)“Retail seller” means an entity engaged in the retail sale of electricity to end-use
customers located within the state, including any of the following:
(1)An electrical corporation, as defined in Section 218.
(2)A community choice aggregator. A community choice aggregator shall participate in the renewables portfolio standard program subject to the same terms and conditions applicable to an electrical corporation.
(3)An electric service provider, as defined in Section 218.3. The electric service provider shall be subject to the same terms and conditions applicable to an electrical corporation pursuant to this article. This paragraph does not impair a contract entered into between an electric service provider and a retail customer
before the suspension of direct access by the commission pursuant to Section 80110 of the Water Code.
(4)“Retail seller” does not include either of the following:
(A)The Department of Water Resources acting in its capacity pursuant to Division 27 (commencing with Section 80000) of the Water Code.
(B)A local publicly owned electric utility.
(k)“WECC” means the Western Electricity Coordinating Council of the North American Electric Reliability Corporation, or a successor to the corporation.
For purposes of this chapter, the following terms have the following meanings:
(a)“Baseload generation” means electricity generation from a powerplant that is designed and intended to provide electricity at an annualized plant capacity factor of at least 60 percent.
(b)“Combined-cycle natural gas” with respect to a powerplant means the powerplant employs a combination of one or more gas turbines and steam turbines in which electricity is produced in the steam turbine from otherwise lost waste heat exiting from one or more of the gas turbines.
(c)“Electric service provider” means an “electric service provider” as
defined in Section 218.3.
(d)“Greenhouse gases” means those gases listed in Section 38505 of the Health and Safety Code.
(e)“Load-serving entity” means every electrical corporation, electric service provider, or community choice aggregator serving end-use customers in the state.
(f)“Long-term financial commitment” means either a new ownership investment in baseload generation or a new or renewed contract with a term of five or
more years, which includes procurement of baseload generation.
(g)“Output-based methodology” means a greenhouse gases emission performance standard that is expressed in pounds of greenhouse gases emitted per megawatthour and factoring in the useful thermal energy employed for purposes other than the generation of electricity.
(h)“Plant capacity factor” means the ratio of the electricity produced during a given time period, measured in kilowatthours, to the electricity the unit could have produced if it had been operated at its rated capacity during that period, expressed in kilowatthours.
(i)“Powerplant” means a facility for the generation of electricity, and includes one or more generating units at the same location.
(j)“Zero- or low-carbon
generating resource” means an electrical generating resource that will generate electricity while producing emissions of greenhouse gases at a rate substantially below the greenhouse gases emission performance standard, as determined by the commission.
(a)The commission shall retain jurisdiction over the interconnection of a microgrid to the distribution system of a large electrical corporation. For purposes of interconnection, a microgrid shall be treated as a single, controllable entity.
(b)The commission shall not have jurisdiction over whether a microgrid complies with all other local and state building and safety codes and standards pursuant to subparagraph (B) of paragraph (3) of subdivision (b) of Section 218.
(c)The Energy Commission may develop safety standards for microgrids and may issue optional guidelines for the governance and oversight of microgrids to local governments to streamline permitting and encourage
scalability.
(d)As used in this section, “microgrid” means a microgrid, the operation of which is exempt from the definition of an electrical corporation, as described in subdivision (b) of Section 218.
No reimbursement is required by this act pursuant to Section 6 of Article XIII B 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 XIII B of the California Constitution.
