Clean State Energy Actions 2011 Update. california

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1 Energy Efficiency Appliance/Equipment Efficiency Standards Building Energy Codes Utility Rate Realignment Minimum energy efficiency standards for 21 categories of appliances Set minimum energy efficiency standards for 23 appliance categories. The standards now apply to 10 categories of appliances. Residential: California Energy Efficiency Standards for Residential Buildings, exceeds 2009 IECC and is mandatory statewide Commercial: California Energy Efficiency Standards for Non-residential Buildings, meets or exceeds ASHRAE and is mandatory statewide All new and renovated buildings must achieve at least a LEED Silver rating Adopted a mandatory Green Building Standards Code (CALGREEN) requiring all new buildings to use environmentally advanced building practices Requires owner or operator of a building to disclose benchmarking data and rating to a prospective buyer, lessee of the entire building, or lender that would finance the entire building based on a schedule of compliance established by the State Energy Resources Conservation and Development Commission Decoupling in natural gas and electricity markets Utility Demand-Side-Management Required public utilities to file smart grid deployment plans by July, Energy Savings Targets/Energy Efficiency Resource Standards Public Benefits Funds Energy efficiency is an option under California s RPS; investor-owned utilities have savings goals of 23,183 GWh (including 4,885 MW of peak demand) expected to save more than 1% of total electricity sales per year from Investor-owned utilities charge a public goods surcharge to be devoted to energy efficiency, renewable energy, and RD&D The California Energy Commission provides up to $26 million in loans to schools, hospitals, and local governments for the installation of energy-saving measures or for energy audits and studies Created the Clean Energy Business Financing program to Provides low interest loans that improve or expand energy efficiency or renewable energy manufacturing facilities in California (See also Clean Electricity and Clean Energy Economic Development) Established the Energy Conservation Assistance Loan Program to provide low interest loans to local jurisdictions for energy efficiency retrofits Personal tax deduction allows taxpayers to deduct the interest paid on loans used to purchase energy efficient products or equipment for a residence; the deduction is for loans from a publicly-owned utility company for the purchase of energy-efficient heating, ventilation, air-conditioning, lighting, solar, advanced metering of energy usage, windows, insulation, zone heating products, and weatherization systems Authorizes college campuses to receive a bill credit to be applied to a designated benefiting account for electricity exported to the electrical grid by an eligible renewable generating facility Energy Commission required to establish a plan for a program to achieve greater energy savings in the state s existing residential and nonresidential buildings

2 (continued) The Public Utilities Commission asked to investigate the ability of electrical and gas corporations to provide customers with energy audits, energy efficiency financing options and to make reports Requires a local publicly owned utility to be responsible for implementing an energy efficiency program Public Utilities Commission and the State Air Resources Board authorized to treat advanced electrical distributed generation technology as cogeneration Makes existing limitations upon gas rates and surcharges charged cogenerators applicable to an advanced electrical distributed generation technology Prohibits placing alternative fuel capability requirements upon gas customers that use gas for cogeneration applicable to a generator using such advanced technology Allows for Property Assessed Clean Energy (PACE) financing (SB 77) The School Facility Program (SFP), through grants approved by the State Allocation Board (SAB), provides funding to school districts for facility modernization. A school district is only eligible when previously un-modified permanent buildings are 25 years or older and relocatable classrooms are 20 years or older. The grant amount fund a large variety of work at an eligible school site including but not limited to air conditioning, insulation, roof replacement, as well as the purchase of new furniture and equipment. The amount of the grant depends on the number of students Required the Alternative Energy and Advanced Transportation Financing Authority to administer a Clean Energy Upgrade Program to reduce the costs to property owners of a loan provided by a financial institution for energy efficiency or renewable energy upgrades (AB X 1 14 See also Clean Electricity). Clean Electricity Renewable/Alternative Energy Portfolio Standards and Goals RPS program requires retail sellers of electricity to increase their sales of eligible renewable-energy resources by at least 1% of retail sales per year, so that 20% of their retail sales are served with eligible renewable energy resources by 2010, with a long-term goal of 33% by 2020 Has a feed-in tariff which allows eligible customer-generators to enter into 10-, 15- or 20-year standard contracts with their utilities to sell the electricity produced by small renewable energy systems -- up to 3 megawatts (MW) -- at timedifferentiated market-based prices. All investor-owned utilities and publicly-owned utilities with 75,000 or more customers must make a standard feed-in tariff available to their customers. Updated the RPS program to require retail electricity sellers to meet 33% of their retail sales with eligible renewable energy resources by The California Public Utilities Commission authorized the use of tradable renewable energy credits (TRECS) for RPS compliance. Utilities may use TRECS to satisfy up to 25% of their requirement, and the price of a TREC is capped at $50. Starting in 2014, there will no longer be restrictions on the sale price and number of TRECs.

3 Net Metering and Interconnection Standards Public Benefits Funds Rule 21 specifies standard interconnection, operating and metering requirements for distributed generation systems up to 10 MW in capacity, including renewables, with separate simplified rules for small renewables under 10 kw; utilities are required to offer net metering to all customers for solar and wind-energy systems up to 1 MW, and investor owned-utilities are required to offer net metering for biogas-electric systems and fuel cells; The feed-in tariff allows eligible customer-generators to enter into 10-, 15-, or 20-year standard contracts with their utilities to sell the electricity produced by small renewable energy systems -- up to 1.5 megawatt (MW) -- at time-differentiated market-based prices. Public Utilities Commission required to determine the requirements for a smart grid deployment plan consistent with the policies set forth in federal law Each electrical corporation required to develop and submit a smart grid deployment plan to the Commission Raised the system-wide cap on net metering from 2.5% to 5.0%. The Renewable Auction Mechanism program requires California s three IOUs to purchase electricity from renewable energy systems up to 20 MW in size within their service territories. Investor-owned utilities (IOU) public goods surcharge to be devoted to energy efficiency, renewable energy, and energy RD&D Supplemental energy payments (SEPs), are available to eligible renewable generators for the above-market costs of eligible procurement by California s retail sellers to fulfill their RPS obligations; property tax exemptions are available for qualifying solar energy systems; loans are available for agriculture and food processing industries to purchase cost-effective energy efficient and renewable emerging technologies; the California Solar Initiative offers $3.2 billion over 10 years for solar energy projects with the objective of providing 3,000 MW of capacity by 2017; the California Energy Commission offers cash incentives to promote the installation of grid-connected small wind and fuel cell renewable energy electricgenerating systems through its Emerging Renewables Program; the Self-Generation Incentive Program (SGIP) offers incentives to customers who produce electricity with wind turbines and fuel cells Authorize loans for the purchase of alternative source energy projects through various instruments including prepayment purchase contracts (SB 77, Alternative Energy and Advanced Transportation Financing Authority Act) Redefines alternative sources Requires contract by the authority for energy derived from an alternative source to the extent prepayment is intended to offset electrical requirements Allows for Property Assessed Clean Energy (PACE) financing (SB 77)

4 (continued) Created the Clean Energy Business Financing program to Provides low interest loans that improve or expand energy efficiency or renewable energy manufacturing facilities in California (See also Energy Efficiency and Clean Energy Economic Development) The California Clean Energy Manufacturing Program encourages the production and manufacture of energy efficiency and renewable energy components; systems and technologies; alternative and renewable fuels; and vehicles and vehicle components. The program provides financial support for businesses; public-private partnerships; and technology developers, fleet owners, academic institutions, consortia, and collaboratives through a variety of financial mechanisms. These include grants, loans, loan guarantees, tax-exempt financing, production incentives, and credit enhancements (See also Clean Energy Economic Development). Required the Alternative Energy and Advanced Transportation Financing Authority to administer a Clean Energy Upgrade Program to reduce the costs to property owners of a loan provided by a financial institution for energy efficiency or renewable energy upgrades (AB 14a See also Energy Efficiency). Excluded expenses related to the design, manufacture, production, or assembly or renewable energy equipment, combined heat and power equipment, and alternative transportation equipment from the state s sales and use taxes. This includes any source of energy under 30 megawatts that reduces the use of fossil and nuclear fuels (SB 71 See also Clean Energy Economic Development). Developed the Clean Energy Jobs plan, which calls for 12,000 megawatts to come from localized energy sources onsite or small systems located close to where energy is consumed that can be constructed quickly, without new transmission lines, and typically without any environmental impact (See also Clean Energy Economic Development). The California Energy Commission awarded a $400,000 grant to a project whose goal is to demonstrate the benefits of using energy storage systems in conjunction with an on-site fuel cell power generation. Streamlined the siting and permitting process for renewable energy projects within the state s Desert Renewable Energy Conservation Plan (DRECP) by adding wind and geothermal energy projects to a program currently in place for largescale solar projects, whereby the Department of Fish and Game (DFG) may offer project developers the option of paying mitigation fees in-lieu of the traditional permitting process (ABx 1 13). Extended the current exclusion from property tax reassessment for purchases of new active solar energy systems to active solar energy systems that are sold in sale-leaseback arrangements (ABX1 15). Alternative Fuels & Vehicles Consumption Targets/Renewable Fuel Standards To increase the use of biomass in fuel production, the state will produce its own biofuels at a minimum of 20% by 2010, 40% by 2020, and 75% by 2050; goal to reduce the carbon intensity of California s transportation fuels by at least 10% by 2020; by 2010, the state has committed to: 1) Build a network of hydrogen fueling stations; 2) ensure that hydrogen vehicles are commercially available for purchase; 3) incorporate hydrogen vehicles into the state fleet; 4) develop safety standards for hydrogen fueling stations and vehicles; and 5) establish incentives to encourage the use of hydrogen vehicles and encourage the development of renewable sources of energy for hydrogen production

5 Infrastructure Enhancement and Evaluation Public Utility Commission required, in consultation with the Energy Commission, the State Air Resource Board, electric corporations, and the motor vehicle industry, to evaluate policies to develop infrastructure sufficient to overcome any barriers to the widespread deployment and use of plug-in hybrid vehicles, and to adopt rules that address a specified matter The Motor Vehicle Registration Fee Program provided funding for projects that reduce air pollution from on- and off-road vehicles. Eligible projects include purchasing Alternative Fuel Vehicles and developing alternative fueling infrastructure. Mandated that by July 1, 2011, the California Energy Commission, in consultation with the Public Utilities Commission, must develop and maintain a Web site containing specific links to web sites that contain information specific to EVs and plug-in hybrid electric vehicles, including: Resources to help consumers determine if their residences will require utility service upgrades to accommodate EVs and PHEVs; Basic charging circuit requirements; Utility rate options; and load management techniques (SB 1455). The California Public Utilities Commission, in consultation with the California Energy Commission, California Air Resources Board, electrical corporations, and the motor vehicle industry, evaluated policies and regulations to overcome barriers to the deployment and use of EVs.Directs utilities and automakers to collaborate in determining process by which consumers will notify utilities of EV purchases. Also holds rates for EV owners stable through 2013 while studying new rate strategies, including time-of-use pricing for EV charging, to go into effect in Grants of up to $5,000 will be made available to consumers who purchase or lease eligible zero emission vehicles (ZEVs), plug-in hybrid electric vehicles, and AFVs between May 24, 2007, and March 31, 2009 Alternative fuels production incentives Qualified alternative fuels and hybrid electric vehicles can use HOV lanes The Hybrid Truck and Bus Voucher Incentive Project provided vouchers ranging from $10,000-$45,000 for eligible fleets to reduce the incremental cost of qualified medium- and heavy-duty hybrid electric vehicles at the time of purchase. The California Public Utilities Commission voted to develop strategies for having buyers of electric vehicles tell utilities about their purchase. The California Public Utilities Commission voted to keep electricity rates for EVs stable until at least 2013 for residential, commercial and industrial owners. Utilities and the CPUC will explore different rate strategies for 2014 and beyond, including basing rates on the time of day to shift EV charging to periods of low demand.

6 (continued) Created the Alternative and Renewable Fuel and Vehicle Technology Program to offer grants and loans for projects that: Develop and improve alternative and renewable low carbon fuels; Optimize alternative and renewable fuels for existing and developing engine technologies; Produce alternative and renewable low carbon fuels in California; Decrease the overall impact of an alternative and renewable fuel s lifecycle carbon footprint and increase sustainability; Expand fuel infrastructure, fueling stations, and equipment; Improve light, medium, and heavyduty vehicle technologies; Retrofit medium- and heavy-duty on-road and non-road vehicle fleets; Expand infrastructure connected with existing fleets, public transit, and transportation corridors; and Establish workforce training programs, conduct public education and promotion, and create technology centers. Established the Motor Vehicle Registration Fee Program to provide funding for projects that reduce air pollution from on- and off-road vehicles. Eligible projects include purchasing Alternative Fuel Vehicles and developing alternative fueling infrastructure. Prohibited any common interest development from restricting the installation of electric vehicle charging stations (SB 209). Created a $5,000 rebate for purchasers of zero-emission vehicles. All funding for this program has been exhausted. The California Energy Commission awarded a $1.2 million grant to an electric vehicle project. Provided financing for property used to develop and commercialize advanced transportation technologies including electric vehicles, fuel cells, and ultra-low emission vehicles that reduce pollution and energy use and promote economic development. Also provided financial incentives in the form of sales and use tax exclusions on qualified property. Lead By Example Appliance/Equipment Efficiency Building Efficiency Green Power Purchasing Alternative Fuel and Vehicle Fleets State agencies must purchase ENERGY STAR appliances when it is cost-effective to do so The goal of the Green Building Action Plan is to improve the energy performance of all state buildings and reduce grid-based energy usage in state buildings by 20% of 2003 levels by 2015; all new and renovated state buildings must be constructed to LEED Silver standards; state agencies are required to cooperate in developing benchmarking and commissioning guidelines, suggesting plans for retrofitting existing buildings, and ensuring builder and contractor compliance Environmentally Preferable Purchasing guidelines for procurement agencies; state agencies and the legislature are required to buy products with recycled content in order to reduce waste 75% of cars and trucks in the state fleet must be energy efficient; 50% of the state fleet should be flex fuel vehicles by 2010; provides grant funding for new school buses and for air pollution control equipment to retrofit existing buses

7 GHG Emissions GHG Policies Participant in Climate Registry; goal to reduce emissions levels to 2000 levels by 2010, 1990 levels by 2020, and 80% below 1990 levels by 2050; caps emissions from electricity retailers and natural gas utilities over the long-term; Proposed Early Actions to Mitigate Climate Change (2007); WCI participant; pending EPA approval: reduce GHG emissions from vehicles 16% from 2002 levels by 2012 and 30% by 2016; provides incentive-based funding for the incremental cost of purchasing cleaner than required engines and equipment for significant near-term reductions in nitrogen oxide emissions, Reactive Organic Gases, and particulate matter emissions Global Warming Solution Act of 2006 amended to include in the definition of greenhouse gas nitrogen trifluoride Updated the State Transportation Plan to address how the state will achieve maximum feasible emissions reductions in order to attain a statewide reduction of GHG emissions to certain levels by 2020 and 2050 Requires the Transportation Commission to submit a report providing information on sustainable communities and alternative planning strategies California is a member of the West Coast Governors Climate Change Initiative along with Oregon and Washington. The three states must act individually as well as regionally to reduce greenhouse gas (GHG) emissions. The Initiative includes adopting standards to reduce GHG emissions from vehicles by expanding markets for efficiency, renewable energy and alternative fuels, including creating a working group on developing hydrogen fuel. Established rules requiring that heavy-duty diesel vehicles must meet Best Available Control Technology standards, which specify maximum exhaust particulate matter and nitrogen oxide levels. Adopted regulations to reduce greenhouse gas emissions from vehicles with a gross vehicle weight ratings of 10,000 pounds of less operating inefficiently with under-inflated tires. Also directed the California Energy Commission to must adopt and implement a state-wide Fuel Efficient Tire Program that includes a consumer information and education program and minimum tire efficiency standards. The California Air Resources Board adopted a regulation to limit and monitor sulfur hexafluoride (SF6) emissions from electric power sector equipment which is expected to achieve a 70 percent reduction of SF6 emissions statewide from electrical utilities a total reduction of 250,000 metric tons of carbon dioxide equivalent by The measure ratchets down the allowable SF6 emission rate from 10 percent in 2011 to 1 percent in Adopted a cap-and-trade regulation that sets a statewide limit on the emissions from sources responsible for 80 percent of California s greenhouse gas emissions and establishes a price signal needed to drive long-term investment in cleaner fuels and more efficient use of energy. By the end of the program in 2020 there will be a 15 percent reduction in greenhouse gas emissions compared to 2010, reaching the same level of emissions as in The California Air Resource Board will begin enforcement in 2013.

8 Clean Energy RD&D Partnerships, Grants, Awards, and Dedicated Funding The California Solar Initiative dedicated $2.6 million to a pilot solar water heating program; investor-owned utilities charge a public goods surcharge to be devoted to energy efficiency, renewable energy, and RD&D; incentives for funding dedicated to research, development, and testing of alternative fuels and advancing vehicle technology; grants and loans to public agencies, businesses, fleet owners, consumers, and academic institutions to develop and deploy innovative technologies that transform California s fuel and vehicle types; the Bioenergy Action Plan includes: research and development of commercially viable biofuels production and advanced biomass conversion technologies; evaluation of the potential for biofuels to provide a clean, renewable source for hydrogen fuel; and increases the purchase of flexible-fuel vehicles to 50% of total new vehicles purchased by state agencies by 2010; participant in the PIER Program Directed the California Public Utilities Commission and utilities to evaluate and plan for increasing electricity storage capacity to inform potential targets for costeffective electricity storage expansion (AB 2514). Granted $724,998 for R&D in to high-tech efficient windows and creating a ten year plan for energy storage technology. Clean Energy Economic Development Task Force, Workforce Development, Incentives, Analysis, Etc New Solar Homes Initiative promotes a self-sustaining market for solar homes as part of the 2007 California Solar Initiative; in February 2008, formed the Green Workforce Coalition, a public-private partnership to define labor market demand for green jobs Established an intergovernmental Green Jobs Council to develop a strategy for meeting emerging workforce needs (AB 3018) Began Green Technology Partnership Academies for high school education programs CPUC required to grant incentives eligible green-technology manufacturers Launched the Green Jobs Corps, a program focused on workforce training and job placement for at-risk youth Public-private partnership manages the Clean Energy Workforce Training Program providing grants for retraining, pre-apprenticeship training partnerships and alternative and renewable fuel and vehicle technologies workforce development Created the Clean Energy Business Financing program to Provides low interest loans that improve or expand energy efficiency or renewable energy manufacturing facilities in California (See also Energy Efficiency and Clean Electricity)

9 Task Force, Workforce Development, Incentives, Analysis, Etc. (continued) The California Clean Energy Manufacturing Program encourages the production and manufacture of energy efficiency and renewable energy components; systems and technologies; alternative and renewable fuels; and vehicles and vehicle components. The program provides financial support for businesses; public-private partnerships; and technology developers, fleet owners, academic institutions, consortia, and collaboratives through a variety of financial mechanisms. These include grants, loans, loan guarantees, tax-exempt financing, production incentives, and credit enhancements. Excluded expenses related to the design, manufacture, production, or assembly or renewable energy equipment, combined heat and power equipment, and alternative transportation equipment from the state s sales and use taxes. This includes any source of energy under 30 megawatts that reduces the use of fossil and nuclear fuels (SB 71 See also Clean Electricity). Established a dedicated funding stream of up to $8 million available from the state Renewable Resource Trust Fund for partnership academy programs that focus on employment in clean technology, renewable energy, energy and water conservation, or pollution reduction (SB 148). Required the allocation of funds from the Renewable Resource Trust Fund, and if needed, another specified fund, for expenditure in the form of grants to school districts to create and maintain partnership academies that focus on employment in clean technology businesses and provides skilled workforces for the products and services for energy or water conservation, renewable energy, pollution reduction, or other technologies (S 1a). Developed the Clean Energy Jobs plan, which calls for 12,000 megawatts to come from localized energy sources onsite or small systems located close to where energy is consumed that can be constructed quickly, without new transmission lines, and typically without any environmental impact (See also Clean Electricity). Other Nuclear Power Before any new nuclear facilities will be considered, the federal government must have a means of disposal for nuclear waste. Also requires legislative ratification for their commission s decision to license nuclear power plant.

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