CPX Legislative Update for October 3, 2019

Updated 10/3/19

Legislative Calendar Check: The legislature adjourned on September 13. The governor has until October 13 to sign bills. We will issue one more legislative update on October 17, and then will be on break until the legislature resumes business in January 2020. In the meantime, visit the CPX legislative page for occasional updates.

In this 2019 session we are monitored about 29 energy and/or climate-related bills, not all of which would directly impact Community Choice Energy. Below is a selection of highlighted bills with a brief summary, the Center’s position, if any, and the status of the bill.

Two-year bills that will come back in 2020:

AB 56 (Garcia) OPPOSE – This bill will empower the CPUC to order energy procurement based on real or perceived shortcomings in the Integrated Resource Plan submitted by Investor Owned Utilities, Direct Access providers, and CCAs. The bill will allow the CPUC to require procurement on any perceived deficiency that may be 10 to 12 years out in the future. This makes no sense, given that so much lead time would allow a CCA to address any potential problem. Read the Center’s updated July Letter of OppositionStatus: Two-year bill.

AB 235 (Mayes) – Now dubbed the “Catastrophic Wildfire Liability Recovery Act,” this bill will allow PG&E to issue bonds to cover 2017, 2018 wildfire liabilities that ratepayers could ultimately have to pay for, and allows the CPUC to arbitrarily set a limit on the amount a transmission & distribution utility must pay as a result of catastrophic wildfire that may have been the result of their infrastructure. It is essentially a defense of status quo corporate utility dominance.  Status: AB 235 is a two-year bill.

SB 246 (Wieckowski) – Read our Support Letter. – This bill, if enacted as written, will impose an oil and gas severance tax on the privilege of extracting oil or fossil gas from the earth or water in California upon any operator engaged in such extraction. Status: Two-year bill. It will be brought back in January 2020.

SB 350 (Hertzberg) OPPOSE – This bill would “authorize the CPUC to consider a multiyear centralized resource adequacy mechanism,” meaning, a central buyer, which would encroach on CCA statutory authority on procurement autonomy. This bill was a tandem bill with AB 56 that is also a tw0-year bill. Status: Two-year bill.

SB 386 (Caballero) – Read our Letter of Opposition. This bill would allow Turlock, Modesto, and Merced Irrigation Districts to count their large hydro assets (dams) toward their Renewable Portfolio Standard (RPS) obligations. This would significantly impact progress with new renewables. These Irrigation Districts will already be able to count their dams as carbon-free pursuant to state policy on decarbonization and mechanisms are in place to protect low-income communities from any cost burdens. Status: Two-year bill.

SB-772 (Bradford) – This bill relates to procurement of long duration bulk energy storage. Concerns center on forcing the hand of CCA procurement. Status: Two-year bill.

SB 774 (Stern) – SB 774 would require IOUs to collaborate with the State’s Office of Emergency of Services and others to identify where back-up electricity sources may provide increased electrical distribution grid resiliency and would allow the IOUs to file applications with the CPUC to invest in, and deploy, microgrids to increase resiliency. Concerns focus on too much control being placed in the hands of the IOUs over microgrid development when other LSEs and stakeholders can and should play a role. Status: Two-year bill.

Bills we opposed that were enacted:

AB 1054 (Holden, Mayes, Burke) – Enacted: This 200-page bill was fast-tracked through the legislature. In addition to encumbering ratepayers with nonbypassable charges for more than a decade just as they were set to expire, and no safeguard against rate increases, the bill includes a clause that is completely outside of any wildfire concern, and it impacts Community Choice agencies. The clause empowers the CPUC to obstruct sales of IOU assets to other load serving entities and public entities. This could hobble local governments wanting to launch their own municipal service, and/or emerging CCAs that may benefit by acquiring assets that the IOUs no longer want or need. Status: AB 1054 passed out of the legislature on July 11 and was signed by the governor. It is now being challenged in federal court by two PG&E customers on grounds that it may allow for ratepayer funds to be used to pay for cost increases due to PG&E negligence.

AB 1584 (Quirk) – In its final form this bill requires the CPUC to develop and use methodologies for allocating electrical system integration resource procurement needs to each load-serving entity based on the contribution of that LSE’ load and resource portfolio to the electrical system conditions that created the need for the procurement. It also requires the CPUC to develop and use methodologies for determining any costs resulting from a failure of a LSE to satisfy its allocation of those procurement needs. Originally this bill would have impinged on Community Choice agency statutory procurement authority. Due to amendments in August, CalCCA shifted to a neutral position. Status: On the governor’s desk.

SB 155 (Bradford) – This bill expands CPUC’s authority over CCA procurement and Integrated Resource Plans. Read the Center’s July Letter of Opposition. Due to amendments made in early July, CalCCA shifted to a neutral position. Status: On the governor’s desk.

SB-520 (Hertzberg) This bill empowers the CPUC to determine what load serving entity should serve as the provider of last resort (POLR). Currently IOUs serve as the provider of last resort in their service territories. A big problem with the bill is that it gives the IOUs veto control over the POLR application process. If another LSE (e.g., a CCA) wants to become the POLR, the incumbent IOU must agree to the application submitted to the CPUC, which is unacceptable. This bill is a step in the wrong direction. It gives the existing utilities control over whether they continue to have the exclusive right to serve as the utility and gives them control over who if anyone would take over the role of POLR. Why should the State hand over that kind of decision-making authority to the existing utilities? We are concerned that over time, this will make the utilities less accountable. We encourage firm opposition to this bill in its current form. Status: SB 520 is on the governor’s desk awaiting his signature or veto.

SB 676 (Bradford) – This bill requires the CPUC, by December 31, 2020, in an existing proceeding, to establish strategies and quantifiable metrics to maximize the use of feasible and cost-effective electric vehicle grid integration. Based on amendments made in early July, CalCCA has shifted to a neutral position. Status: On the governor’s desk.

Bills we supported that were enacted:

AB 684 (Levine) – Read our Support Letter. Rules proposed in this bill would ensure that the infrastructure necessary for EV charging in multi-family dwellings is codified through multi-family building standards. Status: On the governor’s desk.

Bills we supported that died:

AB 1046 (Ting) – Clean Vehicle Rebate Program. This bill would have required the California Air Resources Board to develop a plan to provide for the continuous funding of a program with a goal of supporting deployment of 5 million electric vehicles by December 2030. Status: AB 1046 died in the Senate Appropriations Committee on August 30.

For the complete list of bills we monitored in 2019 click HERE.  The next and final 2019 CPX legislation update will be on Thursday, October 17th.

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