Bill Text: CA AB1536 | 2009-2010 | Regular Session | Amended

NOTE: There are more recent revisions of this legislation. Read Latest Draft

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Bill Title: Electricity: resource adequacy distributed generation

Spectrum: Partisan Bill (Republican 1-0)

Status: (Engrossed - Dead) 2010-06-03 - From committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on E., U., & C. [AB1536 Detail]

Download: California-2009-AB1536-Amended.html

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BILL NUMBER: AB 1536	AMENDED
	BILL TEXT

	AMENDED IN SENATE  SEPTEMBER 2, 2009
	AMENDED IN SENATE  JUNE 23, 2009
	AMENDED IN ASSEMBLY  MAY 6, 2009
	AMENDED IN ASSEMBLY  APRIL 14, 2009

INTRODUCED BY   Assembly Member Blakeslee

                        FEBRUARY 27, 2009

    An act to amend Section 379.6 of the Public Utilities
Code, relating to energy.   An act to add and repeal
Sections 6245 and 6246 of the Public Resources Code, relating to
public resources, and making an appropriation therefor. 


	LEGISLATIVE COUNSEL'S DIGEST


   AB 1536, as amended, Blakeslee.  Distributed energy
resources incentive program.   Public and gas leases.
 
   (1) Existing law authorizes the State Lands Commission to enter
into a lease for the extraction of oil or gas from state-owned tide
and submerged lands in the California Coastal Sanctuary if the
commission determines that those oil and gas deposits are being
drained by means of producing wells upon adjacent federal lands and
if the lease is in the best interests of the state.  
   This bill would create the Interim Resources Management Board,
consisting of the Secretary of the Natural Resources Agency, the
Secretary for Environmental Protection, and the Controller. The bill
would authorize the board to consider a draft lease, lease
application, or revised lease application filed with the State Lands
Commission pursuant to that provision and subsequently rejected by
the commission. The bill would authorize the board to approve that
lease if specified terms and conditions are met.  
   The bill would provide for the repeal of these provisions on
January 1, 2011. The bill would set forth related declarations and
findings.  
   (2) The bill would annually appropriate, commencing with the
2010-11 fiscal year, up to $50,000,000 from the amounts received
annually by the state from the royalty payments made pursuant to a
lease entered into under the bill, as scheduled. The bill would
provide that $34,000,000 would be allocated to the Department of
Conservation for purposes of making subvention payments under the
Open Space Subvention Act of 1971 to eligible counties participating
in the California Land Conservation Act of 1965, and that $16,000,000
would be allocated to the Department of Parks and Recreation for the
acquisition and operation of state parks along the coast.  

   (3) The bill would appropriate, for the 2009-10 fiscal year, up to
$50,000,000 from the amounts received during that fiscal year by the
state from the royalty payments made pursuant to a lease entered
into under the bill to the State Department of Public Health, as
scheduled.  
   Under existing law, the Public Utilities Commission (PUC) has
regulatory authority over public utilities, including electrical
corporations, as defined. Existing law requires the PUC, in
consultation with the State Energy Resources Conservation and
Development Commission (Energy Commission), to administer, until
January 1, 2012, a self-generation incentive program for distributed
generation resources. 
   This bill would instead require the PUC, in consultation with the
Energy Commission, to administer the distributed energy resources
incentive program for distributed generation until January 1, 2012,
for the purposes of deploying distributed generation technologies
that the PUC determines produce benefits for ratepayers commensurate
with their contribution to the costs of the program. The bill would
additionally authorize incentives to be provided pursuant to the
program for energy storage systems meeting certain requirements and
would delete certain combustion-operated distributed generation
projects from eligibility. The bill would delete the commission's
existing authority to include other ultraclean and low-emission
distributed generation technologies, as defined, in the program. The
bill would limit program costs to no more than $83,000,000 per year.

   Vote:  majority   2/3  . Appropriation:
 no   yes  . Fiscal committee: yes.
State-mandated local program: no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1.    The Legislature finds and declares all
of the following:  
   (a) Since 1994, the State Lands Commission has been prohibited by
the California Coastal Sanctuary Act of 1994 (Chapter 3.4 (commencing
with Section 6240) of Part 1 of Division 6 of the Public Resources
Code) from granting any new oil or gas leases on state-owned tide and
submerged lands, unless the state's oil or gas resources are being
drained from producing wells on adjacent federal lands and the
commission determines that a lease is in the best interests of the
state.  
   (b) Since 1994, no application for a lease has been granted under
this exception by the State Lands Commission.  
   (c) In the current fiscal emergency, it is in the public interest
to consider an application considered and rejected by the commission
prior to the effective date of this act, pursuant to Section 6244 of
the Public Resources Code, from an operator with existing offshore
drilling platforms on federal lands and with existing and operating
infrastructure that seeks to access state offshore oil or gas
reserves for a limited period.  
   (d) The provisions of this act are necessary for the promotion of
the public interest and are of statewide concern. 
   SEC. 2.    Section 6245 is added to the  
Public Resources Code   , to read:  
   6245.  (a) The Interim Resources Management Board is hereby
created for the limited purpose of considering an oil or gas lease
application meeting the criteria set forth in Section 6246 that was
denied by another state agency prior to the effective date of this
section.
   (b) The members of the board shall be the Secretary of the Natural
Resources Agency, the Secretary for Environmental Protection, and
the Controller. The Secretary of the Natural Resources Agency shall
be the chairperson of the board.
   (c) The board shall hold at least one public hearing when
considering an oil or gas lease application.
   (d) If a majority of the members of the board determine pursuant
to Section 6246 that an oil or gas lease be entered into, the
chairperson of the board shall execute pursuant to Section 6246 the
lease on behalf of the state.
   (e) This section shall remain in effect only until January 1,
2011, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2011, deletes or extends
that date. 
   SEC. 3.    Section 6246 is added to the  
Public Resources Code   , to read:  
   6246.  (a) Notwithstanding Section 6244, within 30 days after the
effective date of this section, the Interim Resources Management
Board shall meet for the purpose of considering a draft lease, lease
application, or revised lease application, including the terms and
conditions, that was filed with the commission pursuant to Section
6244 and that meets all of the following criteria:
   (1) The lease, lease application, or revised lease application was
considered and rejected by the commission prior to the effective
date of this section, pursuant to Section 6244.
   (2) The record before the commission demonstrates that state oil
or gas deposits are being drained by means of producing wells upon
adjacent federal lands.
   (3) The lessee has an existing offshore platform on adjacent
federal lands from which the state oil or gas reserves will be
accessed.
   (4) The lessee has existing and operating pipelines and other
infrastructure to transport and process the oil or gas.
   (5) The board determines that the lease is in the best interest of
the state.
   (b) The chairperson of the Interim Resources Management Board may
enter into a lease or leases on behalf of the State of California if
the lease or leases contain the following conditions that are
enforceable by the Attorney General:
   (1) The lease has a fixed termination date that is no more than 14
years from the effective date of the lease.
   (2) The lease requires the lessee to make a single prepaid royalty
payment to the State Treasury in the total amount of one hundred
million dollars ($100,000,000) for the leases involved in the
application.
   (3) The lease provides, at a minimum, the rental fee and royalty
payments as specified in the lease application considered and
rejected by the commission prior to the effective date of this
section, pursuant to Section 6244.
   (4) The lessee is required to avoid, reduce, or offset all direct
greenhouse gas emissions from project operations under the lease.
   (5) Upon expiration of the lease, the lessee shall terminate all
oil and gas production operations offshore California, if any, and
remove all related onshore processing facilities, if any, that are
owned, controlled, or operated by the lessee at the time the lessee
accepted the lease, and shall clean up, restore, and donate not less
than 3,900 acres of land for public use and conservation, including
land on which the onshore processing facilities were located.
   (6) The lessee shall use all feasible efforts to remove four outer
continental shelf federal platforms and provide funds, in an amount
and manner to be determined by the Interim Resources Management
Board, in an escrow account, letter of credit, or equivalent
instrument, to be used to address any adverse environmental effects
of offshore oil drilling from the four platforms, or for
decommissioning or removal of the platforms, if the platforms are not
decommissioned or removed due to circumstances beyond the control of
the lessee.
   (7) The terms and conditions of any agreement related to the draft
lease, lease application, or revised lease application identified in
subdivision (a) between the lessee and a nongovernmental third party
shall collectively constitute a condition of any lease. The lessee
shall provide a copy of any agreement to the Interim Resources
Management Board as soon as feasible, and the agreement shall be made
public in a conspicuous location on the Natural Resources Management
Agency's Internet Web site at least 30 days prior to the
reconsideration of any lease pursuant to subdivision (a).
   (8) The lease shall provide, without limitation, that the Attorney
General shall enforce the terms of the lease.
   (c) The lease shall contain all other terms agreed to by the
lessee in a lease application considered and rejected by the
commission prior to the effective date of this section, pursuant to
Section 6244, that are not in conflict with the act that adds this
section. Nothing in this section precludes the board from requiring
lease terms that are more protective of the environment, or that will
produce greater revenue for the state, and that are not in conflict
with this act.
   (d) Any action to challenge Section 6245 or this section may only
be filed and served within 60 days of the effective date of those
sections.
   (e) Except as provided in paragraph (8) of subdivision (b), any
challenge to a lease executed pursuant to this section may only be
filed and served within 60 days following execution of the lease and
notification of its execution. The complaint or petition shall also
be served within that 60-day period on the lessee as a real party in
interest. Notification of the execution of the lease shall be posted
on the Natural Resources Agency's Internet Web site and through a
press release issued by the Natural Resources Agency.
   (f) This section shall remain in effect only until January 1,
2011, and as of that date is repealed, unless a later enacted
statute, that is enacted before January 1, 2011, deletes or extends
that date. 
   SEC. 4.    (a) Of the amounts received by the state
annually from the royalty payments made pursuant to a lease made
pursuant to Sections 6245 and 6246 of the Public Resources Code, up
to fifty million dollars ($50,000,000) is hereby appropriated,
commencing with the 2010-11 fiscal year, in accordance with the
following schedule:  
   (1) Up to thirty-four million dollars ($34,000,000) to the
Department of Conservation for purposes of making subvention payments
in accordance with Chapter 3 (commencing with Section 16140) of Part
1 of Division 4 of Title 2 of the Government Code to eligible
counties participating in the California Land Conservation Act of
1965 (Chapter 7 (commencing with Section 51200) of Part 1 of Division
1 of Title 5 of the Government Code).  
   (2) Up to sixteen million dollars ($16,000,000) to the Department
of Parks and Recreation for the acquisition and operation of state
parks along the coast.  
   (b) The one hundred million dollars ($100,000,000) prepaid royalty
payment received by the state pursuant to paragraph (2) of
subdivision (b) of Section 6246 of the Public Resources Code is not
subject to appropriation pursuant to subdivision (a) of this section.

   SEC. 5.    (a) Of the amounts received by the state
during the 2009-10 fiscal year from the royalty payments made
pursuant to a lease made pursuant to Sections 6245 and 6246 of the
Public Resources Code, up to fifty million dollars ($50,000,000) is
hereby appropriated for the 2009-10 fiscal year, in accordance with
the following schedule:  
   (1) Up to twenty-one million six hundred sixty thousand dollars
($21,660,000) to the State Department of Public Health for various
programs administered by the Office of AIDS.  
   (2) Up to sixteen million three hundred thirty-seven thousand
dollars ($16,337,000) to the State Department of Public Health for
the Domestic Violence Program.  
   (3) Up to nine million dollars ($9,000,000) to the State
Department of Public Health for the Adolescent Family Life Program.
 
   (4) Up to three million three thousand dollars ($3,003,000) to the
State Department of Public Health for the Black Infant Health
Program.  
   (b) The one hundred million dollars ($100,000,000) prepaid royalty
payment received by the state pursuant to paragraph (2) of
subdivision (b) of Section 6246 of the Public Resources Code is not
subject to appropriation pursuant to this section. 
   SEC. 6.    The State Lands Commission shall
administer a lease entered into pursuant to Sections 6245 and 6246 of
the Public Resources Code, as added by Sections 1 and 2 of this act.
 All matter omitted in this version of the bill appears in the
bill as amended in Senate, June 23, 2009 (JR11)