Amended  IN  Senate  March 23, 2021

CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Senate Bill
No. 345

Introduced by Senator Becker

February 09, 2021

An act to add Section 383 to the Public Utilities Code, relating to energy.


LEGISLATIVE COUNSEL'S DIGEST


SB 345, as amended, Becker. Energy programs and projects: nonenergy benefits.
Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations and gas corporations. Pursuant to existing law, the commission supervises various energy efficiency, renewable energy resource, self-generation, distributed generation, and demand response programs.
This bill would require the commission to (1) establish common definitions of nonenergy benefits, as defined, and attempt to determine consistent values for use in all distributed energy resource, as defined, programs, begin the process, by January 1, 2023, to establish common definitions of nonenergy benefits and attempt to determine consistent values and methodologies for use in assigning priority access to authorized funds by distributed energy resource programs, (2) incorporate nonenergy benefits in prioritize the use of authorized funding to support distributed energy resource programs and projects, projects that provide the greatest nonenergy benefits, particularly for disadvantaged communities, and (3) track the demonstrated nonenergy benefits produced in resulting from distributed energy resource programs during program evaluations. evaluations and make this data available publicly on the commission’s internet website. The bill would prohibit the calculation of nonenergy benefits from being used in a manner that results in incremental cost shifting to nonparticipating customers or from being used to determine the cost effectiveness of distribution deferral projects or to estimate the value of avoided costs for use in evaluating distributed energy resource programs.
Vote: MAJORITY   Appropriation: NO   Fiscal Committee: YES   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) Nonenergy benefits is a broad term that describes the impacts of energy programs and projects to program participants beyond participants, nonparticipating customers, and society beyond just the generation, conservation, and transportation of energy.
(b) Common nonenergy benefits include lower energy costs, costs for participants, increased property value, improved public health, increased energy reliability, and much more. Nonenergy benefits can also help correct historic disparities in accessing clean energy and energy efficiency programs.
(c) The Public Utilities Commission already quantifies nonenergy benefits, but does not consistently apply that analysis to all decisions. decisions for these programs.
(d) As a result, decisions of the Public Utilities Commission are not strategic in selecting projects with the most cobenefits, and have led to lack of meaningful access to programs in low-income and environmental justice communities where cobenefits would be most meaningful.
(e) To address this disparity in accessing clean energy and energy efficiency programs, a recent study completed by the State Energy Resources Conservation and Development Commission pursuant to the Clean Energy and Pollution Reduction Act of 2015 (Chapter 547 of the Statutes of 2015) recommended California “[e]stablish common definitions of nonenergy benefits, develop standards to measure them, and attempt to determine consistent values for use in all energy programs.”
(f) Incorporating consideration of nonenergy benefits provides in public purpose programs can provide greater cost effectiveness to all ratepayers by increasing the cobenefits produced by public investments.
(g) Incorporating and tracking nonenergy benefits is critical to ensure that California’s transition to a clean energy economy is as quick, efficient, and equitable as possible.

SEC. 2.

 Section 383 is added to the Public Utilities Code, to read:

383.
 (a) It is the intent of the Legislature that the commission incorporate give priority to distributed energy resources with the greatest nonenergy benefits into decisions regarding distributed energy resources to ensure consistency in funding recommendations, when selecting projects for programs funded in whole or in part by public purpose charges. The commission should assign this priority to correct historic disparities in accessing these technologies, and to ensure investments are as strategic and beneficial as possible.
(b) For purposes of this section, the following terms have the following meanings: “distributed energy resources” means distributed renewable generation resources, energy efficiency, energy storage, electric vehicles, and demand response technologies.

(1)“Distributed energy resources” means distributed renewable generation resources, energy efficiency, energy storage, electric vehicles, and demand response technologies.

(2)“Nonenergy benefits” means the array of diverse impacts of energy programs and projects beyond the generation, conservation, and transportation of energy. Nonenergy benefits exist in three overarching categories: participant nonenergy benefits, utility nonenergy benefits, and societal nonenergy benefits.

(c) The commission shall do all of the following:
(1) Establish By no later than January 1, 2023, begin the process to establish common definitions of nonenergy benefits and attempt to determine consistent values and methodologies for use in all assigning priority access to authorized funds by distributed energy resource programs. In defining the nonenergy benefits, the commission may consider the impacts of energy programs and projects to program participants, nonparticipating customers, and society that are not included in analyses of the costs and benefits to the electrical grid.
(2) Incorporate nonenergy benefits in Prioritize the use of authorized funding to support distributed energy resource programs and projects. projects that provide the greatest nonenergy benefits, particularly for disadvantaged communities identified pursuant to Section 39711 of the Health and Safety Code.
(3) Track the demonstrated nonenergy benefits produced in resulting from distributed energy resource programs during program evaluations. evaluations and make this data available publicly on the commission’s internet website.
(d) (1) The calculation of nonenergy benefits, pursuant to subdivision (c), shall not be used in a manner that results in incremental cost shifting to nonparticipating customers by the incorporation of those benefits into the level of compensation provided to distributed energy resource projects or hosts under a contract, tariff, or incentive funded through rates collected from nonparticipating customers.
(2) The calculation of nonenergy benefits, pursuant to subdivision (c), may not be used to determine the cost effectiveness of distribution deferral projects or to estimate the value of avoided costs for use in evaluating distributed energy resource programs.
(3) Notwithstanding paragraph (1), this section does not require altering the use of nonenergy benefits in administering public purpose programs in existence as of January 1, 2021, including, but not limited to, the California Alternate Rates for Energy program, continued pursuant to Section 739.1, and the energy savings assistance program, established pursuant to Section 2790.
(e) This section is not intended to set rates, alter or supplant existing cost-effectiveness calculations, or alter or supplant existing requirements for distributed energy resources adopted by the commission prior to January 1, 2022.