Assembly Utilities and Energy Committee, Wednesday, April 22, 2026
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Assembly Utilities and Energy Committee California State Assembly
Ihren Sitzungen folgenRedner 3
Thank you, madam chair, members of the committee. Matt Friedman on behalf of the Utility Reform Network. AB eighteen thirteen would jump start the deployment of distribution connected renewable energy projects paired with significant amounts of energy storage. Many customers today cannot benefit from behind the meter solar because they don't own their property or because their property is unsuitable for solar. As mentioned by Assembly Member Ward in his opening statement, 45% of Californians are renters and over two thirds of low income customers rent.
Net metering is primarily a policy for homeowners, but community solar would allow these customers to subscribe to shared facilities and receive benefits. In 2022, Tern worked cooperatively with the community solar industry and assembly member Ward to support the enactment of AB twenty three sixteen, and this bill directed the PUC to establish a community renewable energy program and included specific direction with respect to the value of these projects. And turn support was based on the recognition that the long standing voluntary green energy programs administered by the investor owned utilities were neither successful nor scalable. And by the opportunity to use community programs as a low cost alternative compliance option for the new solar home mandate under title 24 of the state's building code. Despite the clear directives in a b twenty three sixteen, the PUC issued one decision in 2024 and another that they're proposing to adopt next month, both of which embrace a nonviable, noncompliant, and incomplete program that is designed to fail and perhaps never even meant to launch.
Due to the extended delays in implementing twenty three sixteen, key sources of federal state and federal and state money are no longer available to support this program. So the PUC's refusal to implement a b twenty three sixteen, represents a huge missed opportunity and a failure of leadership. This bill would redirect the PUC to make changes to its flawed program that would unlock the development of substantial quantities of new local solar and storage that can place downward pressure on rates. The legislature has a chance to require the PUC to do this program right, so we ask for an I vote. Thank you.
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Good afternoon, chair and members. My name is Marian Borgeson. I'm the California director for climate and energy at NRDC. I'm here in strong support of AB eighteen thirteen as we were previously with Assembly Member Ward's bill previous bill. California urgently needs clean energy and storage that can be built quickly.
Today, too many solar projects are stuck in massive queues at a time when we have huge need for additional resources and growing electricity demand. Community, scale solar and storage offers one of the fastest ways to actually get store storage and solar built. These projects can be built in twelve to twenty four months, not years and years like larger scale storage and larger scale solar and storage, and the speed really matters if California is serious about reliability, affordability, and meeting our climate goals. A b eighteen thirteen unlocks this opportunity. It supports these local resources that can meet near term grid needs and provide benefits to customers who can't access rooftop solar.
Community solar has also been shown to deliver meaningful bill savings, can make a real difference as customers are struggling with high costs. And by delivering clean power closer to where folks live and in constrained pockets of the grid, these projects can help reduce reliance on peaker gas plants. A b eighteen thirteen is really a practical, equitable step forward, and we respectfully urge your I vote. Thank you.
Redner 1
Thank you. Do we have any additional, support in the room? Please come forward and state your name and affiliation.
Redner 37
Good afternoon. Raquel Mason with the California Environmental Justice Alliance, SEHA Action, also asked to register support from GRID Alternatives and Clean Coalition. Thank you.
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Good afternoon. McKinley Thompson Worley on behalf of the Solar Energy Industries Association in support.
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Good afternoon. Christina Scrinch for the Center for Biological Diversity in support.
Redner 8
Good afternoon. Thank you. Derek Chernow with Californians for Local Affordable Solar and Storage, the bill sponsor. Obviously, urgent. Vote.
Just wanna make sure that folks know this is not a new concept.
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Jeff Neal representing the Contra Costa County Board of Supervisors, also in support.
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Brandon Smith with Dimension Energy in support. Good afternoon. Matt Klopfenstein on behalf of, Center for Sustainable Energy in support. I've also been asked to give support for the Climate Center. Thank you.
Redner 13
Good afternoon. Tyler Tratton on behalf of Coalition Community for Community Solar Access and both solar in support. Thanks.
Redner 1
Thank you. Do we have any main opposition in the room? Please come forward.
Redner 9
Thank you. Brandon Ebeck here on behalf of Pacific Gas and Electric. We do not have a opposed position on the bill as in print. We have significant concerns of what we've seen in the committee analysis. First in process, I don't think I've ever seen a bill be substantially amended from a spot bill into a substantive bill as committee amendments.
So we will need more time to fully review what is proposed for us. We have spent more than four years talking about this program. Going back to AB twenty three sixteen, we had concerns with the way the bill is constructed. We provided a lot of feedback to the sponsors and the author about how it would be essentially impossible to make a program that is cost effective, that meets all of the goals. That's just given our experience running a variety of other programs that have failed, as the authors witnesses have mentioned, and we spent tens of millions of dollars trying to administer those programs.
So we're essentially back here again trying to fix programs that won't work. Ultimately, as utilities and load serving entities, we procure the least cost, best fit resource. We agree that there are certainly sections of our grid, as we'll talk about on utilization bills later, that are constrained where resources like small batteries and solar will have value. But we need to assign the cost benefit on each specific project, not a program that just pays the projects a rate above the wholesale energy rate. That will create a cost shift.
It's pretty much no way around that. The other concern that we've had going back to twenty three sixteen is according to the analysis that we've seen where there's the most benefits, the constrained pockets of the grids are most likely represented by CCAs where they're the default energy provider. So if the utility is trying to buy power for where our customers don't live, that creates a problem with the program. So it's including the author's own district are majority CCA. So it's a little bit confusing on who's in the bill, why we don't have an option to opt out like other low serving entities if the program's not cost effective.
Thank
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you. Thank you, madam chair. Israel Salas with San Diego Gas and Electric, also not not positioned on record. The bill was substantially amended as was noted by my colleague from PG and E. On the issue of CCAs, about 85% of our service territory today is represented by one of two CCAs.
So we are concerned about the cost impacts. We have a a small dwindling bundled customer base, and so we are concerned about any additional administrative costs of of standing up this program. The CPUC, as was noted earlier, just issued a proposed decision within the within the last two weeks to finalize implementation of the predecessor bill. So that has taken up a lot of time, a lot of resources, and so we are concerned about how this bill is gonna continue the potential of cost shifting on a limited customer base. So not having had the chance to fully review the bill, it's been available for less than twenty four hours.
We will probably be opposing this bill on a going forward basis. Thank you.
Redner 1
Thank you. Do we have any additional support opposition in the room? Please state forward with just your name and affiliation.
Redner 23
Catherine Borg with Southern California. It's in similar position. Oh, hi. Again, Catherine Borg with Southern California Edison, similar position. We don't have an official one based on the print time of the language.
Redner 1
Okay. I'm gonna bring it back to the committee to see if you have any questions for mister Ward.
Redner 2
Thank you. I, you know, I would acknowledge again that this committee, had a very, healthy deep dive into this issue, during the speakers, requested outcomes review of the, AB twenty three sixteen bill. And while a lot of these terms, a lot of the, a lot of the math that was evaluated, over the last couple of years, were under question. Nothing is a surprise to advocates or myself who attended those PUC hearings. I'll admit I'll acknowledge as well too this was not something unanimously adopted by the PUC.
It only passed on a three to one vote. But there was deep concern by many of us that the direction that they were gonna go would render any of these projects potentially economically infeasible. I categorically discount that that these are gonna create opportunities that either, one, are gonna still add to any kind of so called cost shift. That is something that we're particularly, baking into the measure of the bill. Continue, of course, as always, be able to meet with opposition to ensure that that is, underscored.
But, also, I draw your attention to page three of the analysis, because if you'll see there under the explosion of community solar opportunities across the country right now, of all the states, the state of Florida, is running away, with these opportunities for community solar models. And so this is very much, economical and workable, and we deserve to have the same here for California. If it's good enough for Florida and it can work there, we know we can make it work here. We are behind in this opportunity, and specifically for those that currently don't have access for solar opportunities, this corrects a lot of the direction that unfortunately was flexible at the time and allowed for everything to go off of the tracks, but let's get it back on the track. California used to be the leader in solar opportunities right now.
You know that our solar industry is deeply suffering right now from a succession of decisions that are being made both in the legislature, but more specifically at the commission. And we wanna get those back on track to be able to have those jobs and to be have and and to have a green energy opportunity for Californians that currently don't have that kind of access. And when the time is appropriate, I respectfully request your I vote. Thank
Redner 1
you so much. Okay. Next up, we have file item 11, a b twenty three one three by Semeleven Berman. Welcome, mister Berman.
Redner 5
Thank you to the committee staff, for their work on this bill. I will be accepting the committee amendments as outlined in the analysis. Gas utilities plan to spend millions of dollars in the coming years to replace aging gas service lines, a cost which is paid for by all rate payers. AB twenty third AB twenty three thirteen, the Home Energy Choice Act, would require each gas corporation to offer a gas distribution service line replacement alternative program. This program will give customers with a planned service line replacement the option to instead discontinue their gas service and use a portion of those funds to electrify their home.
Redner 13
AB twenty three thirteen will not only ease economic barriers to clean energy, but also reduce long term costs for all ratepayers by avoiding long term investments in gas infrastructure. This will protect the environment, promote public health, and provide long term savings for all ratepayers as California equitably manages our transition away from fossil fuels. I respectfully ask for your aye vote, and I'm joined today by Marion Borgeson with NRDC and Matt Vespa with Earthjustice.
Redner 4
Hello again. Good afternoon. As I mentioned before, I'm California director for climate and energy at NRDC. My name is Marion Borgeson. We're here I'm here in strong support of twenty three thirteen.
Redner 47
I'm especially glad to be supporting this bill because I've experienced the problem that it addresses firsthand. About two years ago when the gas service line to my home needed replacement, I wasn't given a choice. The utility notified me, dug up my property three days later, and replaced the line despite the fact that my family was more than halfway to electrifying my home. I even asked the utility workers if they would delay the the, replacement so that we could electrify and was told that it was too late. That experience made very clear how limited consumer choice is today and how easily we continue to lock in fossil fuel infrastructure without asking whether it still makes sense.
Redner 4
Twenty three thirteen brings choice and common sense to this process. When a utility needs to replace an aging gas line, this bill allows homeowners to choose electrification instead of automatically rebuilding gas infrastructure. Replacing a single gas service line, that's the bit from the main to your house, can cost more than $20,000. Those costs, including utility profit, are spread across all gas customers and paid off over more than fifth five decades. Locking in that expensive infrastructure long after California has committed to a carbon neutral future and driving up costs for remaining customers.
The Home Energy Choice Act offers a smarter path forward by redirecting a portion of those funds that would have replaced us gas pass pipeline into a voluntary electrification incentive. This bill lowers the barriers for homeowners and protects ratepayers from stranded assets. Twenty three thirteen is practical, forward looking. It's customer centric. It helps families modernize their homes, reduce costs, and supports California climate goals all without mandating change.
I respectfully urge your support. Thank you.
Redner 19
Good afternoon, chair and members. I'm Matt Vespa, senior attorney with Earthjustice, a cosponsor of a b twenty three thirteen. I'm gonna briefly address opposition arguments to the bill. First, contrary to claims, a b twenty three thirteen would increase bills for gas customers. The energy choice incentive under the bill will lower costs for all gas customers because it avoids more expensive pipeline replacement projects gas customers would otherwise have had to pay for.
This is also why opponents' cost shift arguments missed the mark. The transition to heat pumps and other electric appliances is already underway. Heat pumps are out selling gas furnaces, and awareness of the superior performance and health benefits of induction cooking is growing. People are moving off gas with or without this bill. What AB twenty three thirteen does is encourage customers to do that.
At the moment, it will save other gas customers money by avoiding adding cost to the gas system. This is what a managed transition looks like and what AB 30 twenty three thirteen helps achieve. Second, rather than undermining s b twelve twenty one zonal electrification projects, a b twenty three thirteen complements those efforts. Gas utilities in New York offer both types of programs because they target different opportunities. California should be doing the same.
Redner 42
And finally, the incentive levels AB twenty three thirteen can provide are meaningful. We looked deeply into this issue in PG and E's rate case, calculated the avoided cost was around $20,000, and that a $15,000 incentive will provide substantial savings to nonparticipants. PG and E agreed this was a reasonable incentive level. $15,000 goes a long way to making home electrification affordable, and bill the bill requires coordination with low income programs to enable incentive layering so low income customers are also able to realize the health, safety, and comfort benefits of all electric homes. For these reasons, I urge you to vote for energy choice and vote aye on a b twenty three thirteen.
Redner 1
Thank you. Do we have any additional support in the room? Please step forward and state your name and affiliation only.
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Good afternoon. Christina Scringe with the Center for Biological Diversity in support.
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It's on. I'll speak up louder. Sorry. Christina Scringe with the Center for Bi
Redner 20
On behalf of Leadership Council for Justice and Accountability in support. Thank you.
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Chair members, Gialdentes on behalf of San Diego Community Power in support.
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Will Brigard for Climate Action California and three fifty Humboldt, in support. Thank you.
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Good afternoon. Kiana Valentine on behalf of Sonoma County Transportation and Climate Authorities in support. Michelle Kanalis with Union of Concerned Scientists in support.
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Brady of Englund here on behalf of Southern California Edison in support.
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Madison Vanderclay with the b l d with the Building Decarbonization Coalition Action Fund in support.
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Alicia Priego on behalf of the city of San Jose and San Jose Clean Energy in support, but we are reviewing the amendments. Thank you.
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Mark Fenstermaker for Peninsula Clean Energy in strong support.
Sean McNeil, California Community Choice Association in support.
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Marky Spaceman with NRDC on behalf giving me to you on behalf of the Climate Center, Climate Future California, All Electric California, the California Green New Deal Coalition, the National Association of Pediatric Nurse Practitioners, Orange County Chapter, Carbon Free Silicon Valley, Clean Earth for Kids, Courage California, Efficiency First California, Fallbrook Climate Action Team, and Stop Waste. Thanks.
Redner 5
Good afternoon. Chris Rosa here to register support on behalf of Spur Grid Alternatives, Resilient Palisades, Rewiring America, and Coalition for Clean Air.
Redner 1
Thank you. Do we have any main opposition in the room? Please come forward.
Redner 27
Madam chairman and member Scott Wetch on behalf of the California State Pipe Trades Council, the California Coalition of Utility Employees, and the State Association of Electrical Workers. I wanna appreciate the the amendments and the analysis make a very bad bill better, but we have two major points of, opposition. The first one is just last year, we negotiated, s b twelve twenty one with the sponsors and with, this committee and the senate to create a pilot program for electrification and replacement of the gas system. It has just gotten approved by the PUC and just gotten underway. So this is bad faith to us.
But more importantly, I too have a personal story, and I will look backward instead of looking forward. And that is the San Bruno tragedy that killed eight people in 2008 when I was here, and I attended every single hour of the Blue Ribbon Commission that looked into that because the then president of Q was on that commission. And the problem I have with this bill is that the fund that it takes, the the repair and replacement fund is a fund that is there for safety. And now you're using it to incentivize electrification. That may be a fine goal.
Don't take it out of the fund that is there to replace the highest priority pipelines that need to be repaired or replaced. To give you an example, in the last year, see for SoCal Gas and San Diego Gas and Electric, the the utility asked for 360 some odd million dollars to go for that type of work. We went in with a list of how much deferred maintenance there was and replacement work to be done, and we thought it should be closer to $500,000,000. That's what we did as interveners. Ultimately, the commission approved $93,000,000, a delta of a $122,000,000.
The point being is there's not enough money going into that fund every year just to do the identified work that needs to be done. So if you want to incentivize, if you wanna buy appliances, if you wanna do whatever this bill proposes to do, don't do it out of the fund that goes towards safety. It's reckless.
Redner 28
Madam chair and members, Kent Causs with San Diego Gas and Electric and SoCal Gas. We appreciate the thorough analysis and recommended amendments, but we remain opposed due to safety and affordability concerns as detailed in our letter. The analysis not only suggests significant amendments to the bill, but it also raises several implementation details that are yet to be determined. I would note that this increased workload at the PUC is on top of of what is going on currently in S B 1221 as my colleague noted. On safety and logistics, the bill requires an incentive offer to be made to all impacted customers with planned service replacements.
This offer could indiscriminately delay all pipeline safety work, including time sensitive safety work. Safety for us is priority for number one, so we are concerned about the impact to get that work done. On the issue of cost, we appreciate the committee's amendment acknowledging the impact of departing customers to remaining customers. This an important flag given the affordability challenges in the state, and it's unclear to us how these cost savings will ultimately be passed on. The other thing to note in this is the state over the last several years has invested about $1,000,000,000 in this transition out of a different bucket of funds.
This is using gas repair funds to electrify, which we do not believe is inappropriate. On the electric side, we've experienced similar programs where these cost shift exists, and I point to net metering. I know it's controversial subject, but some consumer advocates have tagged that at $8,500,000,000 cost shift. We wanna avoid that on the gas side. We do believe that s p twelve twenty one is a better path, more efficient, community based, not individual customer by customer base.
And in the end, when this repair work is being done, you're not avoiding all of that work. You still have to go remove the meter, probably the pipe. You got a pipe. You gotta cap the pipe that's going from the main to the service. You're not avoiding all of these costs.
You're still having to do this. That maintenance work is being done for a reason. Most often, it's safety. This doesn't avoid all of that work. There may be very small incremental.
With those concerns, we ask for your no vote.
Redner 11
Thank you. Alright. We're gonna open it up for additional opposition testimony in
Redner 22
Good afternoon, chair members. Connor Gessman, on behalf of the Utility Workers Union of America in opposition. Thank you.
Redner 11
Okay. Bringing it back to committee. Questions, comments? I know that I walked in mid testimony from our opposition witnesses. It's one of those weeks.
I think all of us have had to be four places at once. But I I did want, no. I think you've raised some very real concerns regarding safety and affordability. Can the author respond to some of those opposition concerns regarding safety and affordability?
Redner 13
You bet. So a couple of issues in regards to concerns about the cost shift, which is something that we work with the committee very, very, closely with and appreciate the dialogue with the committee staff and the amendments that I said earlier that we're accepting. But this bill is designed to save every ratepayer money and reduce risk long term. The incentive level must be less than the total cost of the service line replacement. I believe that includes, things like capping and and removing the meters.
If it doesn't, we'll tighten
Redner 13
up, which will lower the cost that all ratepayers would otherwise pay. And recent amendments also make it very clear that the incentive level must benefit remaining gas customers, and that was, that came out of, the the conversations with the committee. I'll defer to my, witnesses if they wanna add any points on that.
Redner 13
And and then in terms of safety concerns, there's typically there's there's typically a significant amount of time between when a service line is identified for replacement and when replacements actually happen. And and so for PG and E, the average time between the identification and breaking ground yeah. And breaking ground for main and service line replacement programs is over a thousand days. The average time for so called gas is just shy of four hundred days. This gives time to offer customers the choice to electrify and disconnect from the gas system.
The PUC can then determine what the appropriate deadlines are for customer responses to avoid delays to plan work, and the bill also includes an exemption for emergency replacement to ensure imminent safety issues can be addressed. And I'll once again let my my witnesses dive deeper into those facts. Okay. There it is. Yeah.
Redner 11
Okay. And as we were in conversation with the author about this bill, I think the the big idea of this bill is that as we are transitioning from gas to electric, that rather than making investments in upgrades to the gas infrastructure, you you know, use those funds to encourage electrification. And what we tried to do with the committee amendments was make sure that that was, you know, kind of a one for one exchange rather than, depleting, you know, funds for work that was still going to be necessary. I hear the opposition witnesses saying that we did not get that right. So I guess help help me understand.
Like, I guess, do you agree that there's sort of a concept where there's some work that could not be done and transferred to electrification? Are you saying everything is a fixed cost in the system until the system is, like, obsolete?
Redner 28
No. There could be some savings. For example, if you're replacing a pipeline, a service line, the capital cost of that pipeline, you're no longer making. You still have all your o and m to go do the work to pull the pipe out of the ground, to remove the meter. All of that still continues.
The savings there could be some amount of savings. We don't anticipate it being this this high to provide the incentives for electrification. And for low income customers, they're they're gonna pay the higher share of the remaining fixed cost when that customer leaves. If you have a customer leave, they're paying as part of their fixed cost or their operational cost, their their usage cost. They're contributing to fixed costs.
That customer goes away, leaving the low income customer who chooses not to or doesn't have the opportunity because that service line is not being replaced or they don't own the home and even in a position to make that decision, they're they're gonna be paying a higher percentage of the ongoing fixed cost.
Redner 27
My point was more about, ongoing funding availability. So to go if if if Scott Wetch calls and says, I I don't I wanna electrify. I don't need my gas anymore. It's not it's it's really not that cost intensive. A crew goes out.
They don't dig up the pipe. They cap it in the street. Right? They go and they remove the meter. Doesn't cost a lot.
They can do a crew can do maybe half a dozen of those a day. It's and that fund funds that. And it and it's not funded annually to the point to perform all the work that could be done because we hashed that out the general rate case and provide the data of how much needs to be done, and we got a fraction of what the diff what that deferred maintenance is. So the dollars that are then also going out of that fund on the incentive side, I'm not saying you shouldn't fund that, but don't take it out of the safety fund. Because if not, those dollars would stay in that account and would be we would be able to do more replacements and more repair.
That's also a repair and replacement fund. It's not just a replacement fund. And it's already underfunded in our opinion, so it's an inappropriate place to take the money, a safety fund, especially in light of the fact that we have a fairly recent tragedy on a distribution line.
Redner 11
Okay. Alright. Understood. Alright. Seeing no oh, assembly member Schultz.
Redner 31
Thank you very much, madam chair, and thank you to the author. I'll get to the safety point last, but I actually had a couple questions to the author and his witnesses. At least in my read of the bill, and please correct me if I'm wrong, there are some unanswered questions, in terms of how exactly the financial incentive program would be offered, how long cust residential customers with the amendments would actually have to opt into the program. So do you have a vision in mind as you sit here today of where you're hoping to go with that? And as you move forward with the legislation, is that something that can get your commitment to work with the opposition on?
Redner 13
So first of all, you bet. And I've had some conversations with the opposition, and and, obviously, we'll continue to. And and aside from philosophical differences, you know, wanna do what we can to to address concerns that they raise. The the idea we we've kind of tailored the bill to leave a lot of these decisions to the PUC. And so in regards to the incentive amounts, specific incentive amounts will be determined by the PUC based on utility cost data, and it says explicitly that it cannot be greater than the average lifetime cost of the service line.
So we try to bake in that, you know, this is really meant to for for homeowners who say, I no longer want natural gas. I wanna transition to to to electric I wanna go electric. You know, that whatever that amount was that you were gonna spend giving me a new natural gas hookup from the main line to my house, Some of that money shut out the costs. The that'll go into capping it and taking out the meter. And then have some of that money go to incentives, and some of that money go to lowering the cost for all natural gas ratepayers across the whole system to make sure that everybody's costs go down.
In terms of kinda some there's some implementation and logistical questions. The bill directs the PUC to consider a number of items as you alluded to, including notice requirements and coordination with other entities as they determine program design and implementation. So that is you know, the idea is rather than being overly prescriptive to give them the the flexibility to determine some of those details.
Redner 31
Okay. Thank you. The second question that I had before I get to the safety issue was, as I understand it, and again, correct me if I'm wrong, with the committee amendments, it would be targeted to residential customers. So we're talking about the owners of real property. Correct.
Have you given any thought to how renters could benefit from a program like this, and how exactly would they benefit? That's a little unclear to me.
Redner 13
Yeah. I mean, one way that everyone benefits is is the program will be specifically designed for rates to go down And for some of this money to go towards lowering rates for everybody, I'll defer to my witnesses who might be able to talk about whether or not they've looked into that New York or,
Redner 4
Yeah. I mean, any any homeowner or property owner who has renters in that property would be able to participate. So it would be up to that renter sorry, that property owner to decide, oh, with this additional incentive, I'm now gonna actually electrify my property. Maybe they think there's gonna be better, ability to get rents or, you know, their cuss their their renter will have better quality of life in that home with some better heating and cooling systems. So I think there's gonna be reasons for, you know, landlords to really consider this just like any property owner would.
Redner 31
Last question on the safety point. I I'll be honest. I think the bill continues. It needs a little work. It need there are more conversations that need to be had.
I think the point raised by mister Wedge certainly sets off some concern in my mind. But I I guess, at at a top level, I see what you're trying to do, and I do think it's a fundamentally good thing to ease our transition as long as the runway is gonna be to where we need to go. So my question is, are is there any flexibility in terms of looking at the sources of the of the funding to mitigate at least some of the concerns that the opposition has raised today?
Redner 31
Okay. With with that in mind, you'll have my vote today, but I'll look to see how this bill evolves. And should it make it to the floor, I'll have a conversation with you then. You bet. Thank you.
Redner 11
Let me ask a follow-up question. So for the concerns Mr. Rech raised by you, which if I understand it's that somehow this will end up kind of rating the safety fund, which you feel like is already insufficient, Are there is there a way to put sort of guardrails or safeguards into the bill to protect against that concern?
Redner 27
We could look into that. I mean, in our view, the fund is already, I mean, they approved 96,000,000 just for SoCalGas, and they were they had identified over $300,000,000. We had identified over $500,000,000 worth of work. And look, I'm not anti, like, electrifying. I represent electricians who will do the electrifying and panel upgrades.
This is a serious safety issue. We will look at it, but nothing comes to mind immediately.
Redner 11
Okay. And I guess the last thing I would say kind of listening to the conversation, I mean, I think there are certainly the safety question is pertinent to this very specific bill. I think that the concerns, Mr. Kaus, that you raised regarding the potential cost shift, that is kind of a larger question that I think, you know, this committee and this body is going to need to tackle. You know, frankly, this bill becomes law or not as we are moving to electrification, that is going to be a fundamental challenge that we've got to grapple with.
I think it's really important for us to keep that front of mind as we are navigating that transition so that, you know, the most vulnerable Californians, the ones who least afford it, aren't the ones who end up shouldering an undue burden as we move through the next decade. So I appreciate your focus on that. And with that, would you like to
Redner 13
Yeah, I appreciate the dialogue, the comments that were made by the opposition, the questions that were asked by committee members. And, you know, this is the first policy committee, so, absolutely, we are far from fully baked in in the details of the bill. And, you know, we'll continue to work with opposition. And we'll continue to work with the chair and committee, you know, as if the bill moves forward. And, you know, this is something that's been done in New York.
It's I I think helps, you know, pace out that transition that we're trying to accomplish as a state to meet the goals that we've set, but but obviously don't wanna do that in a way that, creates, any any concerns around safety, or or cost shifts. So, you know, those are two things that we've talked with the committee about and we'll continue to work on.
Redner 11
Well, thank you. And I believe we are still operating as a subcommittee, so we will take up that measure
Redner 11
The appropriate time. Thank you. Alright. We are, going to move to file item number four, a b nineteen seventy five, assembly member Schultz.
Redner 31
Alright. Oh. Thank you very much, madam chair and committee members. I'm pleased to present today
Redner 31
Assembly bill nineteen seventy five, and I'd like to begin by thanking the committee and their staff for the hard work on the bill. I accept all of the suggested committee amendments, starting on page two of the analysis. According to electrification impact studies of California's three largest utilities, they project they will need to spend approximately $42,000,000,000 upgrading the distribution system between now and the year 2040 to handle the increased electricity consumption from electric vehicles and building electrification, assuming a status quo scenario. Fortunately, we are at a stage of techno technology development to reduce those costs. Solar charged batteries, electric vehicle chargers, heat pumps, and other customer devices are networked together and can flatten the curve on the times of day when we use the most energy.
When utilities expect the peak amount of electricity consumption to approach the amount of electricity they're able to deliver, they build bigger substations and replace overhead wires with thicker wires and upsides upsize transformers and do other types of grid expansion. But it's important to distinguish peak consumption from total consumption. The more we can coordinate the timing of local electricity consumption and shift peak usage to off peak hours, the more total energy we'll be able to transmit over existing infrastructure. That's our challenge. We want those electric cars and heat pumps that will use more electricity instead of gasoline and natural gas, but we want that to happen without spending $42,000,000,000 expanding the grid.
We can do that by modernizing grid management. The first step is to establish data, and that's really the heart the the thrust of this bill. As proposed to be amended, a b nineteen seventy five would require the CPUC to develop a grid utilization methodology that is a straightforward measure of how much energy the utilities are transmitting compared to the maximum amount they're built to transmit. In essence, how full the wires are along with all the other equipment. The committee committee amendments leave implementation details up to the CPUC.
However, the bill does provide guidance to the CPUC to consider to consider whether to direct the utilities to create and expand cost reducing grid management programs. AB nineteen seventy five will help reduce electricity rates by requiring utilities to make better use of the electric grid that they already have built out and paid for. By measuring grid utilization across the utility's distribution system, the CPUC will be able to identify the best opportunities to reduce system costs and make sure that we are making progress over time. With me today to speak in support of the bill are Dan Jacobson on behalf of our sponsor, Environment California, and Jo McLean of White Pine Renewables. Thank you.
Redner 11
And before we, hear from your witnesses, we are gonna take a commercial break to establish quorum. So, madam secretary, if you can please, call the roll.
Redner 29
Petrie Norris. Here. Petrie Norris. Here. Patterson.
Burner. Calderon. Here. Calderon here. Chen.
Davies. Gonzales. Herabidian.
Redner 32
Thank you, madam chair. You're very kind. My name is Dan Jacobson with Environment California. I wanna thank assembly member Schultz for two reasons. One is for introducing the bill.
This is very important. But two is that was really a great opening and really getting into the details of exactly why we need this bill. AB nineteen seventy five will establish a metric to measure the utilization of California's distribution bill, and it'll take an important step toward California's future by building more distribution and allowing us to put more energy onto the existing lines. And that's, I think, really important. Currently, we have over 250,000,000 home batteries in California.
And according to the PUC, we're adding about 2,000 batteries every single week. That's important because these batteries are already putting a downward pressure onto rates, and that's one of the key things that we wanna be able to focus on. There's two highlights from the analysis, which I thought was excellent here. The first is the evolving grid that we have. As the analysis points out, we used to live in a grid system where we had one point of power, and it went in a one way direction.
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Now because of the solar and the storage and the smart meters, we have a way in which to move that around, and this utilization is so important to be able to figure it out. Second, and as the assembly member has already pointed out, this program allows us to save billions of dollars for ratepayers, and that's gotta be a primary concern. When the appropriate time comes, Urge and I vote. Thank you very much.
Redner 9
Good afternoon, members of the assembly. My name is Joe McLean, and I lead engineering at White Pine Renewables, a California based solar and storage developer. I was involved in building two battery projects, and I'll I'm here to tell you about today. The last two years, my team deployed two distribution connected battery systems in Kern County working within PG and E's distribution infrastructure deferral framework, a pilot program that PG and E was mandated to administer. Both projects solved real grid problems and both avoided avoided the kind of expensive time consuming infrastructure work that ratepayers typically foot the bill for.
Redner 33
At our Blackwell's Corner project, a local substation transformer was overwhelmed by midday solar generation every spring. The conventional fix would have been to replace that transformer, a costly months long undertaking. Instead, we installed a battery system that can charge during those peak springtime solar hours and discharge into the evening hours. During the couple of months where this transformer is overloaded, PG and E sends commands a day ahead requesting that our batteries perform. The transformer is still there and doesn't need to be replaced.
At our Lakeview project near Bakersfield, the distribution feeder was hitting its limits during summer peak demand. The traditional answer would have been to build out an additional distribution line. Instead, we deployed a one megawatt battery that, when given the day ahead command, discharges for three hours during peak periods in the summer months to relieve stress on that line. Both of these projects reduced and deferred PG and E upgrades to save money for the ratepayer. Because these projects were only done with a pilot program, PG and E is not soliciting these types of solutions that unlock more grid capacity.
Without the pilot, PG and E would have defaulted to the transformer replacement and distribution line replacement, and nobody would have questioned it. Given the success of these projects, we at White Pine are interested in doing more projects of this nature. Modern day solutions exist that allow the grid to be used more efficiently, which reduces cost to the rate payer, but only because the utility was mandated to do so. These types of projects are replicable across more utilities via blueprint utilizing the grid to the fullest extent possible. Happy to field any additional or more detailed questions about how the project works or any other details.
Thank you for
Redner 11
Thank you. Alright. We'll move to additional testimony in support. If you'd like to testify in support of a b nineteen seventy five, Perch the microphone.
Redner 35
Good afternoon, madam chair and members of the committee. Brandon Garcia on behalf of Advance Energy United in support of the bill. Thank you.
Redner 34
Good afternoon. Brad Hebner with Cal State of California Solar and Storage Association in support. Also asked to express support from the Climate Center in addition to Altadena Energy, Brighton Solar, Voltus, Dirapi, Peak Demand, Excite Energy, Clean Energy Cleantech Energy Solutions, and Six Rivers Solar. Thank you.
Redner 2
Chair members, Max Perrin, behalf of Q Cell, is also in support. Thank you.
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Sean McNeil, California Community Choice Association. We are support if amended, strongly support the goals and intent of the bill, but wanna be eligible for the financial incentive portion of the proposal. Thanks.
Redner 3
Matt Friedman with Utility Reform Network. We have a supportive amended position on the bill. We're still looking at the committee amendments to see if they address our concerns.
Redner 22
Madam chair, members, Brady Vettingman here on behalf of Southern California Edison. We are, opposed unless amended to the bill, currently reviewing the committee analysis. We appreciate the the thoughtful analysis conducted by committee. The amendments do seem to address and ameliorate a lot of our concerns, so look look forward to getting back to you and having a further conversation about this. But if I may, really quickly, just some of the concerns that we had, you know, we're at Edison, we're thinking about this as well too.
More from the perspective of beneficial load growth. You know, that it it's the right customer at the right place at the right time, which doesn't require a grid build out, can save ratepayers money from that perspective, and also applies downward pressure to all of our customers based on the fact that we're adding, you know, significant load growth from the perspective of, you know, who who these customers are. So that is something we've we've definitely been thinking about. Some quick numbers for you all really quickly. For every thousand megawatts of beneficial load growth that we're able to add to our system, it reduces the rates for all of our our customers by three to 4%.
So we have numbers in mind and targets in mind, and we'd we'd we're certainly welcome to conversation and how we hit those numbers. You know, I think, you know, we'd love to be part of that conversation and figure out how we can do that. A couple of other things to note too here is that our customers have choices, and, you know, we we certainly respect that. So, you know, if they they seem to, you know, want to migrate toward more a more energy efficient appliance or install solar, those are those are good things. You know?
And we want to see them do that. But that does kind of I don't know if you will. It it distorts the metric a little bit because their consumption is now reduced. So, we appreciate the deference that the amendments give to the commission to account for that, perhaps, you know, take a more nuanced approach in thinking about that because I, you know, I certainly don't I don't wanna speak for the entire company, but, you know, I'm Edison, I don't think really wants to be in a position where we're knocking on a customer's door and telling them, sorry. You you can't do that.
That's I mean, you guys would hear from us immediately if something like that happens. So we're you know, welcome to that conversation, how we think about that moving forward. But, you know, those are a couple of the issues I wanted to raise really quickly. But, again, we appreciate the the work of the author, and I look forward to continuing this conversation.
Redner 32
Hi, chair members. Luis De Sallon with San Diego Gas and Electric. Appreciate this bill as well. It's very ambitious. There's a lot there to do, and we're on the same side.
Redner 36
We wanna make our energy bills affordable and also appreciate the well thought out analysis. There's a lot of great amendment recommendations that we'll review and take back to see if they actually work for us as well. We do feel that, the AB nineteen seventy five treats higher grid usage as a goal, but
Redner 36
not how we feel that reliable electric system works. And setting these rigid grid use targets could actually raise costs and undermine clean energy goals. And the last part that I wanted to make sure we mention is that we just don't control how often and when our customers use electricity. So we wanna be able to and I know these are points that were already brought up in the in the committee analysis as potential amendments. We appreciate that.
Wanna keep working with the author on this and, and see how the bill looks once the amendments are in print. So thank you so much.
Redner 6
Yep. Hi. Good afternoon. Valerie Torella of La Joce with Pacific Gas and Electric Company. Oppose unless amended position and associate our feedback and comments with our colleagues from the investor owned utilities.
Thank you.
Redner 11
Alright. Okay. I've I've got a question. So in your comments, you were talking about beneficial load growth, but I don't I don't see beneficial load growth as being incompatible with the goals of this bill or No. It's the concept of Madam Chair.
Increasing utilization of
Redner 22
didn't mean to catch up. No. It's okay. Madam Chair, they're they're not.
Redner 22
I mean, we yeah. We it's kinda it's two sides of the same coin. It's kinda how I would phrase it. You know, I think grid utilization trying to this bill, at at its beginning, kinda set out a metric and was urging us or, you know, pushing us to achieve that metric. It's, you know, it's since moved from that and kind of what we're hoping is the perspective you know, a a different perspective will be taken where we look at, you know, how do we how do we phrase it before.
How do we add the right customer at the right place at the right time? And do we, the IOUs, have the right tools or the commission, you know, deference to the commission here too? Do they have the right tools in place to ensure that we're able to do that? Because, you know, the backdrop of all of this is we have a duty to serve. So if a customer is, you know, on a transportation corridor and they need to be in that location, we we have to to accommodate and and build out the, you know, the distribution system to accommodate that.
But, you know, if if there is something that could be done to maybe move them somewhere else where there's, you know, less capacity and it would actually afford all of our rate base the opportunity a little bit of downward pressure, then I don't know. Maybe there's some I don't know. Maybe there's something that could be done there, but we don't I don't we don't really have the the tools to do that right now other than flexible interconnections, which, you know, we we started working with a little bit. But, you know, those are those are pretty early stage.
Redner 11
Okay. Alright. Thank you. I'll just say thank you to the author for bringing this forward. I think it's clear that we need to get more out of our existing grid infrastructure.
It's absolutely critical. And I think we also know that what gets measured gets done. And so I really do think that this is a super important step to ensuring that, that ratepayer goals and IOU goals continue to be aligned, as we are confronting a moment of truly historic investment and build out across the state of California. So with that, would you like to close?
Redner 31
Yes. Very briefly, madam chair. I wanna again thank the committee, for the amendments. I do think they substantially improved the bill. And I would just say the intent of the bill has always been that if we can establish the grid utilization metric, if we can measure and maximize efficiencies, that is something deliverable that we can all do to help reduce costs for everybody.
I echo the comments of the opposition, and I do think that we're very close to being on the same page. We'd love the chance to keep working on it. And at the end of the day, let's do something that could that could save a substantial amount of money for ratepayers across the state. Respectfully ask for your I vote.
Redner 11
Thank you. Alright. We have a motion and a second. Madam secretary, please call the roll.
Redner 29
Item number four, AB nineteen seventy five, the motion is due pass as amended to appropriations. Petrinoris? Aye. Petrinoris, I. Patterson, Berner, Calderon, Chen, Davies, Gonzalez, Herbidian, heart?
Aye. Heart I. Erwin? Aye. Erwin I.
Cholera? Pappin? Aye. Pappin I. Chia Rogers?
Aye. Rogers I. Chiavo?
Redner 29
Schiavo, aye. Schultz? Aye. Scholz, aye. Ta.
Wallace? Not voting. Wallace, not voting. Zipper?
Redner 11
Okay. Seven zero, and Zaffel's on call. We'll wait for absent members to arrive. And you've got one more. So we are gonna move to file item number 18, which is a b twenty six twelve.
Redner 31
Thank you very much, madam chair. I I am pleased to present a b twenty six twelve today and, again, wanna thank the committee for their work on the bill. The bill would require the depart Department of Housing and Community Development to research, develop, and propose for adoption standards to and propose adoption standards for a qualified plug in photovoltaic system to function as an energy source within residential and nonresidential electrical circuits. The building standards commission may then adopt, approve, codify, and publish mandatory building energy standards for new construction, building electrical circuit features to enable a qualified plug in PV system. These new standards could go into effect beginning with the first triennial edition of the building code adopted after 01/01/2031.
Therefore, this bill would work with a b one thirty, which was passed last year and included a six year moratorium on the proposal or adoption of new state building code standards. Plug in PV is attracting interest as a new low cost pathway for households and businesses. This new technology allows electric customers to access affordable clean energy and helps take control of their energy costs by deploying small scale solar to offset their electricity use without major electrical modifications to their property. These systems can be bought today at your local Lowe's or Home Depot, and they can be used to lower your energy costs. Some of the cheaper systems can be purchased for, around $500.
Redner 14
However, California currently lacks standardized requirements for how these systems should integrate with the building's wiring, raising both safety and consistency concerns. AV twenty six twelve aims to close that gap by directing state agencies to establish clear uniform electrical circuit standards for plug in solar. In developing these standards, the commission and HCD must consult with stakeholders and encourage public participation in the standard development process. In closing, by establishing uniform rules for plug NPV, the bill facilitates safer adoption of emerging renewable technologies, reducing barriers for households and businesses that are interested in deploying solar. With me to speak, in support of the bill today is Brandon Garcia, California director of Advanced Energy United.
Redner 35
I'll be quick. Good afternoon, chair and members of the committee. Brandon Garcia on behalf of Advanced Energy United. We're a national trade association of businesses whose members represent the full range of advanced energy technologies and services, including energy efficiency, solar, wind, energy storage, electric vehicles, enabling software, and operational procurement of clean energy. We've made a lot of progress in the state has.
A lot of progress in advancing deploying rooftop solar, yet as this committee has noted, many residents, you know, have access to this wonderful technology as well as multifamily households and small businesses. This bill aims to close that gap by directing state agencies to establish clear, uniform electrical circuit standards for plug in solar. Establishing the standards will expand access to clean energy for these underserved customers while improving energy affordability and resilience. This type plug and play solar can help customers offset their electricity consumption, reduce peak demand pressures, and support broader decarbonization goals. We feel that clear standards will provide regulatory certainty to the market, and that will allow additional support and investment in the new distributed energy technologies.
Redner 36
As always, I'd like to note that we appreciate the committee analysis for outlining some of the processes that we still have to go through. We feel that, with enough time, given that the bill will begin in 2031 and that there's processes enabled to, focus on some of the safety and other concerns that we feel we can get there, we feel that this is achievable. But if there were appropriate, would urge and I vote.
Redner 11
Thank you. Okay. Additional witnesses in support. Go ahead and approach the microphone if you'd like to support AB twenty six twelve.
Redner 22
Sorry. Supportive amended. Brady Beningman from Southern California Edison. We just wanna clarify that, you know, we appreciate the the work of the author here. I think this bill's moving in a great direction.
Look forward to continue to work with him. However, one thing we didn't wanna make clear is that we aren't, like the commission weren't, by default, members of every proceeding effectively. The building standards commission where this would go, we are not. So we just wanna get some clarification in statute that we would be part of that proceeding to ensure that, you know, worker safety, that our our employees are are covered and that their their input is actually taken there.
Redner 9
Brandon Eby, Pacific Gas Electric. I align my comments with Edison. Thank you.
Redner 11
Okay. Moving to witnesses in opposition. Do we have a primary witness in opposition? I don't think so. Seeing none.
Alright. Anyone wanting to provide additional testimony in opposition? Seeing none, bringing it back to committee. Assembly member Rogers.
Redner 12
Thank you so much, chair. Just asking the author if he's looking for coauthors. Always. Alright. I'd be happy to join you.
Redner 29
Item number 15, a b twenty six twelve, the motion is due passed to appropriations. Petrinoras?
Redner 29
Petrinoras, aye. Patterson, Berner, Calderon? Aye. Calderon, aye. Chen, Davies, Gonzales, Herbidian, Hart?
Aye. Hart, aye. Erwin? Aye. Erwin, Calra, Pappin?
Aye. Pappin, aye. Rogers, aye. Rogers, aye. Chiavo, Schiavo, aye.
Aye. Schulz?
Redner 11
Okay. Nine o. So that measure is on call, we'll leave the roll open so our absent members can add on. Alright. I don't think we've got any non committee authors, so we will go to file item number two, which is a b eighteen forty nine, assembly member Pappin.
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madam chair and members. Delighted to be with you. So in 1849, like the bill number, gold powered, gold powered California's growth. In AB eighteen forty nine, we're looking to power California's future. AB eighteen forty nine directs the California e Air Resources Board to conduct a study on the need for decarbonized gaseous fuels in hard to electrify sectors and for grid reliability.
California has made immense progress in decarbonization over the past quarter century, and we're a global leader in clean and sustainable power development. Renewable sources of power are more abundant than ever, and both public and private entities continue to find innovative ways to electrify and move towards our climate goals. However, we have to accept the reality that you can't electrify everything. That's where AB eighteen forty nine comes in. Currently, California's power grid still relies on natural gas and diesel through peaker plants and backup generators to supply power during periods of peak electricity demand.
At the same time, we have certain industries such as cement and glass manufacturing, and they rely on high heat combustion processes that are difficult to electrify, which is why they continue to use fossil fuels. Trying to electrify these sectors would significantly strain the grid and be financially infeasible in the near term. If we wanna achieve California's climate goals of reaching net zero greenhouse gas emissions by 2045, we need solutions to reflect real technical and economic conditions in sectors where electrification alone electrification alone is insufficient. Decarbonized gaseous fuels may offer a pathway. They could replace fossil fuel use in hard to electrify sectors like cement and glass manufacturing while also helping stabilize the grid by replacing fossil fuels and industrial processes, peaker plants, and those backup generators.
The issue is that we don't have an understanding of the need for de carbonized fuels and the feasibility of a transition. We need to evaluate how much fuel we're using and how much we will need to replace. You may have heard a lot of chatter surrounding the bill about incentives. This bill doesn't create incentives. It studies them.
It directs the California Air Resources Board to evaluate what policies exist, what could exist, and what their impacts would be. The analysis could just as easily conclude that certain pathways shouldn't be pursued at all. My witnesses with me today are Katrina Fritz of the California Hydrogen Business Council and Julia Levin of Bioenergy Association of California, and they'll discuss the need to assess hard to electrify sectors and decarbonize gaseous fuels. Take it away, Katrina.
Redner 17
Thank you. Good afternoon, chair and members. I'm Katrina Fritz, president and CEO of the California Hydrogen Business Council. We're proud to cosponsor AB eighteen forty nine. California cannot meet its air quality and climate commitments without reducing emissions from sectors that are not easily electrified.
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Heavy industry, long duration, seasonal energy storage represent more than one fourth of the state's greenhouse gas emissions, and addressing them will require both reliable, affordable electricity and complementary solutions. At a time of market uncertainty, a b eighteen forty nine provides clarity by affirming that California intends to continue advancing clean fuels, supporting in state jobs, and strengthening energy reliability and resilience. A b eighteen forty nine fills a critical gap in state planning by directing a comprehensive data driven assessment of how much fuel is needed across end uses that with current technologies cannot be electrified, an analysis California does not currently have. This is not a mandate to define or incentivize any specific fuel. Instead, it requires the state to evaluate potential options in a technology neutral manner, ensuring that future decisions by the legislature are based on evidence rather than assumptions.
Redner 17
This type of assessment is foundational for infrastructure planning, capital deployment, and long term decarbonization. Companies across California are already investing in clean fuel production, infrastructure, and related technologies, creating durable, well paying jobs in manufacturing, construction, project development, and operations. These investments are supporting economic growth in rural, industrial, and disadvantaged communities that stand to benefit the most from new clean energy opportunities. A coordinated state assessment helps ensure these investments align with California's climate and economic objectives. Ongoing federal uncertainty has made it increasingly difficult for emerging clean fuel industries to plan and finance projects at scale, and a b eighteen forty nine provides a stabilizing signal by directing California to evaluate its future fuel needs in a structured transparent manner ensuring that state planning keeps pace with technological market developments.
Thank
Redner 38
Good afternoon, madam chair and members of the committee. Julia Levin with a mic that won't stay up. I'll just hold it. Julia Levin with the Bioenergy Association of California. AB eighteen forty nine takes an important step in meeting the state's climate goals by requiring assessment of a long term need for decarbonized fuels.
The bill does not preclude electrification, energy efficiency, or any other tool to reduce fossil fuel use. Rather, it requires an assessment of how much decarbonized gas California will need in the future in addition to those other decarbonization tools and will provide recommendations back to the legislature for options to replace any remaining fossil gas use. The assessment it requires is an essential step to reduce emissions, both from hard to electrify sectors and the electricity sector itself itself, which continues to rely on natural gas for a third of California's electricity supply. AB eighteen forty nine is also completely consistent with the airborne and CEC plans for climate change and for energy reliability. For example, the airborne's 2022 climate change scoping plan specifically calls for scaling up renewable hydrogen and biomethane as tools to displace fossil fuels in hard to electrify sectors and natural gas use in the electricity sector itself.
The c CEC has also reckon recognized the need for hydrogen and biogas as ways to decarbonize these sectors. AB eighteen forty nine also, does not define decarbonized gas because it is a study bill, not a procurement mandate. It does not establish or require any new incentives. In fact, several state laws already require state agencies to adopt policies and incentives to increase the use of renewable gas, including biogas, biomethane, and renewable hydrogen. That includes incentives that were established in the state's short lived climate pollutant law, s b thirteen eighty three, and multiple incentives across the public utilities code.
So what a b eighteen forty nine does is ask the air board to assess those, to adopt new ones.
Redner 11
Thank you. Thank you. Alright. At this time, we'll hear from additional witnesses in support. Please approach at this time.
Redner 39
Good afternoon, madam chair and members of the committee. Alfredo La Redondo on behalf of the Green Hydrogen Coalition in support.
Redner 40
Good afternoon. Audra Hartman on behalf of Utility Global, a clean energy industrial decarbonization
Redner 22
Good afternoon, madam chair. Jackie on behalf of Coalition for Nutrient for Renewable Natural Gas. Apologies for not getting a letter in on time in support.
Redner 7
Good afternoon, chair and members. Christina Skirinj with the Center for Biological Diversity opposing a b eighteen forty nine. Three quick points. First, we dispute the assurances that this is and will only be interpreted as a study bill. Per its basic statute construction, the bill could be interpreted by an agency or a court as a directive for action to incentivize or accelerate the production and use of these fuels.
Redner 6
Second, to the extent that this is solely an assessment, it's flawed in its presumed bias, enshrining a presumption of benefit in statute before the study's begun. If these technologies are the panacea the proponents claim them to be, then that will bear itself out in assessment. But this bill bakes in the outcome, its structural bias presumes without basis, or even identifying what these fuels are, that these are indeed decarbonized, appropriate, effective, beneficial, and or necessary. Any assessment that predetermines benefit regardless of the object of study is fatally flawed from the start. Third, this assessment is a narrower structurally biased version of assessments already underway.
Redner 7
It's duplicative and given its bias potentially contradictory to ongoing assessments. CPUC and CEC have ongoing proceedings to address electric grid reliability. That's their purview. CARB's s b ten seventy five analysis and report on hydrogen development, deployment, and use is already underway and, I believe, overdue. The next a b, 32 scoping plan due out next year is a holistic multiagency decarbonization plan for the state.
And unlike this bill, these analyses consider potential air quality, health, and climate benefits or harms factors central to CARB's mission. California faces difficult decisions negotiating a critical transition during this dual climate and affordability crisis as well as well as ongoing structural budget issues. It demands strict analysis of public funding priorities directed towards the most cost effective measures with proven return on investments. Every technology must compete for its place in the new energy economy. Thank you.
Redner 11
Thank you. Additional witnesses in opposition, if you'd like to register opposition on this measure, AB twenty eighty eight.
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Jacob Evans with Sierra Club California in a respectful opposition, administering opposition for Leadership Council for Justice and Accountability, positions for social responsibility, SF Bay, San Diego three fifty, the Sunflower Alliance, Center of on Race, Poverty, and the Environment, and the Santa Cruz Climate Action Network. Thank you.
Redner 5
Good afternoon. Kayla Robinson with Californians Against Waste, respectfully opposed unless amended. Thank you.
Redner 17
Ada Welder with Earthjustice in opposition. I would also like to highlight the committee analysis' question about the, lack of definition of decarbonized gaseous fuels. Thank you. Thank you.
Redner 12
Thank you, chair. So overall, I'm very supportive of what you're you're trying to do here, assembly member. I I think you and have had many conversations about green hydrogen and the role in trying to decarbonize tricky to decarbonize industries. I did wanna ask you, picking up on the last comment that was made, but also a couple of the opposition letters that were submitted about the definition for decarbonized gaseous fuels. I as I according to the letters in opposition that there was a commitment in its last committee to provide a definition.
Are you working on that definition? When should we see what that looks like? And would you like to respond to that?
Redner 38
was I I'm sorry. I don't believe the author made that commitment in the last committee. The reason the bill doesn't define decarbonized fuels is we think as a study bill that it's appropriate to have the air board take the first step, which to is to assess the long term need. And then once that is defined, to bring it back to the legislature to determine, once you know how big the hole is, what you want to use to fill it. So we just think it's because there's no regulation, there's no mandate, it's an assessment.
It's about how much gas will California need in the future, gas or other fuels. It could be liquid fuels versus what can be done through electrification or energy efficiency or other tools. So it's really a needs assessment. And then the legislature can decide, based on the amount of need, where that need falls and what sectors, what you think would be the appropriate ways to fill it. It just seems premature, I think.
And we want to give the air board flexibility.
Redner 12
I mean, I understand what you're you're saying in terms of looking for a fuel future. But if we are looking at decarbonized gaseous fuels, shouldn't we have a definition of what that actually is? Like, regard regardless regardless of whether or not we are in our study determining what types of fuels we need and what industries, for the purposes of the evaluation, shouldn't we have a definition of what decarbonized gaseous fuels are if we're gonna be referring to them?
Redner 33
Well, I I think that what we're trying to do, I remember, is once you determine the size of the hole, it it may be that there's a certain kind of decarbonized gas that can be quickly manufactured and, and it's the cleanest and the best or one that's not clean, but it's gonna fill that void faster to get us to twenty twenty forty five. So there are a lot of different variables that can come into play. So I think what the witnesses are saying and what the bill is saying, let's let's let's get to the point of looking at how big the void is, and then it may turn into this type of decarbonized fuel is much better to serve an enormous need or a smaller need or a need that only is really now, by the time we get done with this, in the manufacturing world. I mean, I don't know. Or we're jeez, we're still using generators that are using so much diesel, and they're creating so much.
Redner 37
Then maybe we're gonna have to use x kind of decarbonized gas to fill that void. So we haven't defined it yet.
Redner 12
But I I feel like and maybe I'm maybe I'm missing something. I feel like that might be part of the disconnect on this bill is if you wait to define what a decarbonized gaseous fuel is based on what the outcome of what you need is, then the study isn't really doing much other than telling us creating a definition that fits the overall objective of of pretending that what the need is is is decarbonized gaseous fuels.
Redner 12
I get I get the intent of creating a study where you look at what types of fuels you need, but that can be separate from the idea of what actually qualifies as a decarbonized gaseous fuel. Maybe the study comes in and says that there actually isn't a decarbonized gaseous fuel that can fill it in this industry for the short term, and I totally get that. But writing a definition that captures everything that you end up needing kind of defeats the purpose of having that definition, doesn't it?
Redner 1
I think maybe the confusion is that the end goal of the assessment would be for the airborne to determine how much gas will continue to be used. And what we want is for whatever remaining gas California needs, it needs to be decarbonized. But we don't even know how much that will be, how much can be electrified, how much really can't, practically or even possibly, you know, some of the high heat manufacturing that the state does. And then what do we do about the very significant amount of natural gas that we continue to use for electricity reliability? How can we replace that?
Redner 38
And so it really is an assessment of what the long term gas need is. And and we haven't talked about this, but maybe it would be more clear if the bill approached it that way and then determine how to address that continuing gas need. And then the legislature can determine, okay, you know, do we use liquid fuels? Do we use gaseous fuels? What what should be eligible to fill that remaining gap that can't be electrified or that we need for electricity reliability?
So maybe it obviously, it's the author in the committee's decision,
Redner 11
but maybe if I may the future. Add, so as was noted, the committee analysis did highlight this absence of definition. But I think where we've landed, and is what's written in the committee analysis, is that because the bill's primary output is an assessment rather than a regulatory mandate, that it does seem reasonable to give CARB more discretion to determine what should be included and not foreclosed on fuels and pathways that could prove viable in the future. So I think that was where we landed. That and I as I listened to some of the opposition concerns, it does seem like there is some concern that this is some sort of camel's nose under the tent.
But I think the language of the bill is quite clear that this is an assessment rather than a mandate, which is why Mhmm. Like, we thought it was reasonable to turn some of that investigation and analysis to CARB. Okay. Mister Hart or sorry. Go ahead.
Redner 12
the witness, but there was no commitment in natural resources to add in a definition that some of the opposition letters that were say sent in that cited that that they they're just incorrect.
Redner 37
That's right. We've we've stayed the course on let's define the problem, and then we go from there. And the problem is supposed to focused on what? What is still carbonized? That's kind of where the focus of the study will be.
Redner 12
No. I I wasn't saying some of the opposition letters, but to be clear, did not mean you.
Redner 28
Well, this conversation helped illuminate the questions that I had. But I I was also wanted to talk about was on page three of this staff analysis that talks about, you know, are we looking at this too narrowly? Are there other alternatives to replace decarbonized gas, like the specific things mentioned, energy efficiency, waste heat recovery, and thermal energy networks? Are we making this too narrow to not consider those solutions as well? Or do you believe that the parameters of the study are open enough to make sure that CARB looks at alternatives to non carbon gaseous fuels?
Redner 17
The intent is for CARB to conduct the technical analysis and make those decisions. Right? They would they would connect conduct the assessment, look at what you know, how much gas is needed, and what are some of the viable ways to replace that gas.
Redner 7
And I do appreciate the very thoughtful analysis. One of the points the analysis I'm sorry. Very much appreciate the thoughtful analysis. And one of the points and I hope I can find I may not be able to find it right now, but is a note, and I'm looking here at the text. It doesn't say, and you heard the presumption in the response a few minutes ago, how much gas are we going to need?
Maybe we will need gas, maybe we won't, but the presumption is we will, and we're entering this with that. It doesn't ask, whether to incentivize the increased production and use of decarbonized gas, but how to, and that's just one place in the bill. So so there's a presumption built in that that is the answer even though there are all these other alternatives and many alternatives we have yet to discover. There's new technology moving every day.
Redner 1
Yes. I just wanna thank the author for your work on this and bringing this forward. I understand what you're trying to do. I appreciate the robust discussion, I'd like to be added as coauthor.
Redner 11
just, I think, one final comment and question. I think that the opposition raised some concern about language that could be misinterpreted. It's my genuine belief, knowing the author, that you are entering into this in a very honest way and trying to dig in to get a data driven assessment and ensure that as we are planning for a fossil free future that, we're ensuring that we're doing that in, I think, a way that is realistic, a way that's thoughtful, that's strategic, and, that asks important questions. So with that, assembly member, would you like to close?
Redner 37
Yes. I I just thank you for the robust discussion, and it can't be disputed that we're gonna have some things we can't electrify. And so I I kinda look at this bill, and and I thank you for for the your words, chair. I look at this bill as, like, can this be part of of, you know, what what we can select, what we can we'll select from the menu. We're sort of creating how will the menu look given first, we have to assess the problem, and then what can we do to really get at these last ones that can't be electrified.
So with that, respectfully request an I vote.
Redner 11
-All right. Thank you. Do we have a motion and a second? -Second. -Thank you.
All right. Madam Secretary, please call the roll.
Redner 29
-Item number two, AB eighteen forty nine, the motion is due passed to appropriations. Petrinoris? Aye. Petrinoris, aye. Patterson?
Burner? Calderon?
Redner 29
Calderon, aye. Chen? Davies? Gonzalez? Herbidian?
Aye. Herbidian, aye. Hart? Aye. Hart, aye.
Erwin? Aye. Erwin, aye. Colra? Pappin?
Aye. Pappin, aye. Rogers?
Redner 29
Schiavo. Aye. Schulz? Schulz? I.
Ta? Wallace? I. Wallace? I.
Zipper? Alright.
Redner 11
Ten zero. So that bill is out, and we will leave the roll open for other members for absent members to add on. Okay. And we've got another item from Ms. Pappin, file item number seven, AB 2,088.
Redner 37
Thank you, madam chair, and members. I'm I'm delighted to be here today to present AV 2,088. Can't do as much clever things as I could with '18 49, but that's okay. So I'd like to first, start by thanking the committee, and the chair for their hard work on this bill. And, we, of course, will be accepting the committee's amendments today.
AV twenty eight eight provides the statutory authority for the investor owned utilities, to own and operate what we call thermal energy networks, otherwise known as TENS. Under existing law, there's ambiguity around whether utilities can deploy alternative technologies to deliver reliable heating and cooling to customers within their service territory. This lack of clarity is having an impact on our climate goals. California is committed, as we know, to achieving carbon neutrality by 2045. Meeting that goal requires not just electrification, but a diversified set is there a theme here?
Set of proven to scalable technologies that can reduce emissions. So TENS can fill this gap by harnessing geothermal energy or captured industrial waste, waste heat that could otherwise just be lost. Massachusetts, New York, Colorado, Washington, Maryland, and Vermont have all introduced their own TENS authorizing legislation, and some are developing TENS projects as a result. AB twenty eighty eight clarifies utilities' ability to provide thermal energy service through TENS while building in the following three safeguards. Number one, the bill requires the CEC and the CPUC to develop technical standards to ensure the TENS can be deployed safely and efficiently.
Number two, the bill protects jobs by ensuring that TENS will bolster utilities' existing skilled and trained workforce. And number three, the bill asks that ratepayer protections be considered to protect remaining gas customers and future TENS customers alike. TENS are just another tool in the toolbox, but we won't meet our climate goals by leaving tools on the shelf. So AB twenty eight twenty eighty eight allows utilities to use TENS to build a carbon neutral energy system. With me to testify today is Theresa Chang with Industrious Labs and Madison Vander Klee with Building Decarbonization Coalition.
Please take it away. Teresa.
Redner 44
Madam chair and members of the committee, thank you so much for the opportunity to testify today. I'm California director for Industrious Labs. We're proud sponsors of this bill, AB 2,088. Our organization is committed to helping meet our climate goals while supporting California industry and our existing energy workforce. This bill delivers on all of these fronts.
AB twenty eighty eight unlocks a resource that exists across the entire state, and that's the untapped and abundant geothermal and waste heat. These resources can provide a source of local and clean thermal energy that can provide heating and cooling for homes, businesses, and our industrial users. And they, very importantly, deliver affordable zero emissions heating and cooling while creating high road jobs for the skilled gas utility workforce we already have. However, our current statute lacks the clarity needed for IOUs to help own and operate these clean energy systems, and so this bill modernizes our code by providing that clarity needed while preserving full PUC oversight and ensuring that these systems must be cost effective for ratepayers before being developed. In addition to climate, I just wanna note that TENS have other significant benefits.
Not only are they 30 to 50% more efficient than other air source electric alternatives, but once up and running, the closed loop system also requires significantly less water and can even replace cooling towers that waste thousands of gallons of water a day. Because of the very high efficiency of TENS, they also mitigate the need for costly transmission build out, which we know is one of the greatest drivers of our rising electricity rates. In fact, the DOE projected that nationwide wide widespread deployment of geothermal heat pumps, which are used in TENS, could save ratepayers upward of $557,000,000,000 by 2050. We already have TENS in California. These are not experimental systems.
Redner 16
This is not an emerging technology. They are already delivering cost savings and clean heating and cooling in California, including at Santa Rosa Junior College connecting schools in a hospital in Northern California. But these are single owner models, and they're not utility based for multiple users. And so I'll just close by saying this bill unlocks the potential of TENS to deliver benefits at scale. We still have federal tax credits of up to 50% covering virtually every component of this system.
Redner 21
Good afternoon, madam chair and members. Oh, there we go. Thank you. Good afternoon, madam chair and members. Madison Vander Clay with the Building Decarbonization Coalition.
Redner 46
We are a nationwide network of advocates, businesses, and researchers supporting energy affordability and decarbonization. Buildings are associated with approximately a quarter of California's in state emissions, and reducing emissions in buildings is identified as the most cost effective pathway to achieving California's emissions targets. We have made real progress in this sector, but there is still quite a bit more to be done. Thermal energy networks, otherwise known as TENS, offer a utility scale solution that can bring clean heating and cooling to entire blocks, including multifamily housing and commercial corridors. Instead of each building relying on its own equipment, TENS are collective ambient temperature closed loops filled with water running through underground pipes with heat pumps in each connected building or plant.
Redner 21
The network then captures and delivers thermal energy with zero combustion, meaning no emissions and no pollution. The more buildings connected to a TENS project, the more cost effective and energy efficient the system becomes. What makes TENS especially powerful is their ability to store energy daily and seasonally, charging bedrock with heat in the summer, discharging it in the winter, making TENS not only a clean heating tool, but also a grid asset. TENS have the ability to bring clean heating and cooling to communities at scale while supporting industrial decarbonization and deploying high road jobs for workers of the utility gas system. More than a dozen states, as you heard, have passed TENS enabling legislation.
AB twenty eighty eight would provide this framework in California and allow California to continue leading this transition. I respectfully ask for your I vote.
Redner 11
Thank you. Alright. We'll open it up for additional testimony in support. Please approach the microphone if you'd like to testify in support of AB 2,088.
Redner 22
Pardon, Vindiola, on behalf of the Coalition of California Utility Employees and the California State Pipe Trades Council in support. Thank you.
Redner 11
Thank you. Moving to any opposition witnesses. I don't see a primary witness. Anyone wanna provide me too testimony in opposition to this measure? Seeing none, bringing it back to committee.
Assembly member Rogers.
Redner 12
I just always appreciate a shout out for SRJC. Do we have any bear cub alums in the audience? Just just one. I'd like to be added SSU too.
Redner 12
I got I got you covered there too. Just wanna be added as a coauthor, and thank you for bringing the bill.
Redner 11
I too wanna thank you for bringing this bill forward. I would love to see us be able to deploy more of these systems across the state. This seems like, you know, something that's importantly missing right now to make that happen. So that, would you like to close?
Redner 37
Oh, I just respect the request and I vote. This is I wanna make it like Oprah. You get
Redner 37
Then you get a 10. Then I appreciate the witnesses. I mean, I was like, where do I sign by the time you got done, even though I'm authoring the bill? It's wonderful to hear that they're just win win wins. So I appreciate it and request an I vote.
Redner 11
Thank you. Do we have a motion and a second? Yes. Okay. We've got a motion Oh, and no.
We need a motion and a second.
Redner 29
Item number seven, a b twenty eighty eight. The motion is due, pass as amended to appropriations. Petrie Norris? Aye. Petrie Norris, aye.
Patterson? Burner? Calderon? Aye. Calderon, aye.
Chen, Davies, Gonzalez, Herbidian? Aye. Herbidian, aye. Hart, Irwin? Aye.
Irwin, aye. Calra, Pappin? Aye. Pappin, aye. Rogers, aye.
Rogers, aye. Schiavo? Aye. Schiavo, I. Schultz?
Ta? Wallace? Aye. Wallace, I. Zabur?
Redner 11
nine zero. Zero. Okay. So that measure is on call, and we'll leave the roll open for absent Okay. Are moving now to file item 12, assembly member ransom.
Redner 42
Good afternoon. Good afternoon, madam chair. You might wanna grab the other mic. All right. Good afternoon, madam chair and members.
I'm here to present Assembly Bill 2,338, the Fair Utility Rate Act. Fair is fighting for affordable and informed rates, which aims to bring greater transparency and accountability to how rates are set. On average, residential electricity rates in California are nearly double those in the rest of the country. Over the past decade, customers of California's investor owned utilities have absorbed rate increases that far outpace cost of living adjustments. These these increases compound over time impacting all Californians, but they hit low income, hardworking families, seniors on fixed incomes the hardest, leaving more than 2,300,000 households behind on their energy bills.
Redner 15
At the same time, the California Public Utilities Commission has not consistently applied the cost of living considerations when evaluating utility spending proposals and often failed to account for the cumulative impact of utility spending requests across multiple proceedings. AB 2,338 is a common sense proposal to help rein in rising utility costs by requiring utilities to provide an alternative cost of living constraint rate scenario and to provide evidence to support any proposed increases that exceed inflation. The bill also requires the commission to apply more scrutiny to the total rate increase request submitted by utilities. The status quo is clearly not working. The bill provides a balanced approach that maintains safety and reliability while recognizing that California families are facing an affordability crisis, and utilities should at least put forward an alternative plan for review that outlines possible savings for ratepayers in California.
Redner 42
When the time comes, I respectfully ask for your I vote. And with me today in support of this bill, I have representatives from our cosponsors, including mister Peter Hansel, an AARP member, and Matthew Friedman, is a staff attorney for the Utility Reform Network.
Redner 24
Good afternoon, chair Petrie Norris and committee members. My name is Peter Hansel. I'm an AARP member and a resident of Sacramento. Thank you for allowing me to speak today on behalf of AARP's 3,200,000 members in support of this important bill. I'm sure you're hearing from constituents all the time about concerns about never ending rate increases for their utility bills, and I'm sure you're also hearing a good deal of confusion about the bills that they're receiving.
Like many retirees, my wife and I live on fixed incomes, and
Redner 24
constantly changing, our practices to try to conserve energy. We've invested in weatherization, energy efficient appliances, even turning up, the thermostat in the winter, summer and down in the summer, and still our bills keep going up and up. AARP is supporting a b two three three eight because we support full transparency and accountability when it comes to the rate making process. Ratepayers like me, my family, fellow AARP members deserve to know why we're getting charged more, especially when we're doing everything we can to reduce our energy usage. AARP fully understands that protecting, maintaining, and improving utility infrastructure is costly, especially in an era of extreme weather and inflation.
Redner 13
But this is another reason to support a b two three three eight because the bill creates a new opportunity to build trust between ratepayers, CPUC, and utilities by inviting more scrutiny and sunlight to the rate making process. Voting against a b two three three eight today would preserve the status quo where utilities routinely request unconstrained rate increases and routinely get them with little regard for what ratepayers can actually afford. Conversely, voting in support of a b two three three eight puts the burden of proof where we believe it belongs on utilities to demonstrate that spending above inflation is genuinely necessary for safety and reliability. Thank you for giving me an opportunity to speak today on behalf of AARP members in support of AB two three three eight. We ask for a unanimous high vote.
Redner 3
Thank you, madam chair, members of the committee. Matt Friedman on behalf of the Utility Reform Network. As we know, residential electricity rates have skyrocketed in recent years, creating a crisis of affordability for customers. A recent poll of the governor's race finds that voters say that utilities are the second biggest strain after housing on their household budgets. That's above health care and groceries.
Redner 4
But future rate projections, unfortunately, are not encouraging. The California PUC's 2025 report to the legislature forecast annual rate increases of between 67% for each utility over the next several years, and the primary driver is massive increases in spending. AB twenty three thirty eight addresses the affordability crisis by directing the Public Utilities Commission to prioritize the interest of customers when considering when considering utility request to increase spending and pass through new costs in the form of higher rates. It would require each utility as part of its general rate case to submit an inflation constrained spending scenario that reflects the highest priority needs of the utility. It also requires the it permits the Public Utilities Commission to authorize expenditures in excess of inflation only if the utility provides clear and convincing evidence that the higher expenditures are needed to ensure safe and reliable operations, and it would require the PUC to apply heightened scrutiny to any utility requests outside of the general rate case that are likely to increase spending beyond inflation.
Redner 3
Currently, cases are are considered on a one off basis, really in a vacuum. This would require cumulative consideration of all pending rate increases. I wanna be clear. This bill does not prohibit the PUC from approving rate increases that exceed inflation. It simply requires a higher standard of proof and more scrutiny, which is what we would expect from the commission when looking to protect the interest of rate payers.
So we ask for an I vote on this bill. Thank you.
Redner 11
Thank you. Alright. Opening it up for additional witnesses in support. You can go ahead and approach the microphone if you'd like to register support for a b twenty three thirty eight.
Redner 15
Madam Chair, I'm Michael Bocadero, on behalf of the Ag Energy Consumers Association in support and a reminder, PG and E has 44%
Redner 11
rating We can only for We can only take stuck it in. Yes. Name, affiliation, and position, please.
Redner 40
Audra Hartman on behalf of the California Large Energy Consumers Association, also known as CLICA, in support.
Redner 27
Madam member and and madam chairman and member Scott, which on behalf the California Coalition of Utility Employees, we have a great admiration for what the, what the authors attempted to accomplish. We used to have a very real practical real world problem that this presents. If the investor and utilities are forced to provide a a inflation constrained alternative TRC, it's gonna make us impossible for us at the bargaining table to ever get anything beyond whatever the CPI is projected to be over the next three years. We're gonna go into bargaining with the utility, and they're gonna say, we have to put this constrained GRC over here. So two and a half percent two and a half percent for three years.
And and that's that's gonna be that's gonna be what they what they say. And it's gonna make bargaining extremely, extremely difficult, and it's gonna end up hurting the wages, hours, and working conditions of of my members. We we we wouldn't put, inflation constraints on the state's bargaining with SEIU one thousand when we have huge budget deficits. We wouldn't think of that. We wouldn't put budget constraints on the correctional peace officers or the California Highway Patrolmen or anybody else, when we have huge deficits.
So, it's it's not the intent of what what they're trying to accomplish. It's what the real world impact would be, and that's not solved for here. And so, unfortunately, that's why we're opposed. Thank you.
Redner 23
Good afternoon, Petrie Norris and members. John Kendrick from the California Chamber of Commerce. We respectfully oppose s b twenty three thirty eight. We appreciate the author's focus on affordability, but the mechanism in this bill risks underfunding the investments needed to keep our energy system safe, reliable, and capable of meeting the state's ambitious goals. AB twenty three thirty eight requires utilities to anchor proposed spending increases to Social Security COLA benchmark and requires a heightened showing to exceed it.
The problem is that utility costs do not track general inflation. They're driven by wildfire mitigation, grid hardening, system modernization, compliance with state mandates, and funding of public purpose programs. By anchoring spending to this arbitrary benchmark, the bill creates a bias against forward looking investment. Over time, that could mean deferred maintenance, delayed upgrades, and ultimately higher costs and reliability risks when those needs can no longer be postponed. Put simply, AB twenty three thirty eight risks a less reliable and more expensive system over time.
Redner 8
Now, this is obviously coming from a place of good intentions, and we've seen how well intentioned policies can impact ratepayers. Net metering, for example, began life as a way to drive consumer adoption of rooftop solar. It succeeded, but today, its legacy is a significant cost shift that harms nonsolar customers. A more effective path to affordability is to address the growing share of costs driven by state mandates. For years, the legislature and the commission have used ratepayers to fund programs that go beyond providing affordable, safe, and reliable service and instead serve broader policy objectives.
Redner 23
Today, nearly 37% of the average residential ratepayer bill are those state policy costs. It's nearly $800 a year for the average residential ratepayer. That share continues to grow as new mandates are added each and every single legislative cycle. You hear them in this committee all of the time. If the legislature wants to improve affordability, the focus should be pull on pulling those costs off the bills, putting them into the general fund or funded through GGRN.
Redner 11
And I am sure you're gonna have some questions, so plenty of airtime. Okay. Additional witnesses in support, in opposition. Go ahead and come on up.
Redner 6
Hello. Valerie Terrell of Pacific Gas and Electric Company, also, respectfully oppose.
Redner 36
Hi there. Luca Salono with San Diego Gas and and Electric Electric, also also in in opposition. Opposition.
Redner 11
Thank you. Okay. Bringing it back to committee. Assembly member Calderon.
Redner 1
Thank you, madam chair. So my colleague, I know how important affordability is for your constituents and all of our constituents, and I know this is something that's been top of mind of you since you, you know, first got elected to office. But I do have a question for, I think, the opposition and the support. What is the definition of clear and convincing evidence needed for the CPUC to approve the above inflation GRC?
Redner 3
Thank you for the question. The commission, uses both a clear and convincing evidence standard and a preponderance of evidence standard, depending on the type of proceeding. And historically, the commission, it's noted in the analysis, used to apply clear and convincing evidence as a standard much more frequently. It was the default. In recent years, meaning the last decade or so, they've gravitated towards a preponderance of the evidence.
Preponderance of the evidence essentially means it is more likely than not to be true, like 51% chance that it's true. That's the standard that they typically apply. Clear and convincing, and I can quote from a commission decision, requires that the evidence be so clear as to leave no substantial doubt in the mind of the trier of fact. The commission understands this standard. The clear and convincing evidence test has been used in many proceedings.
We think it just establishes a higher bar and forces the utilities to really demonstrate that the money is needed to support safe and reliable operations of the system.
Redner 18
So so, obviously, I think the goal of this is obviously a laudable one. I mean, one of our key goals is really to try to make sure that electric rates and gas rates and, you know, all the things that consumers are facing, that were focused on that, you know, with with laser focus. So I just wanna, you know, acknowledge that that understand that that's the focus of the bill. I just don't understand how this works, I guess. What is a com an inflation constrained scenario?
I mean, we basically we, through the laws that we pass, require certain the utilities to do certain things, wildfire mitigation, you know, public programs, all of those things. So if and we also know that what's driving electric costs are not the price of bread and eggs and the kinds of things that a household would face, even though that's what our our constituents are facing, obviously. So I just I just don't understand what the inflation constraint scenario is. Are you basically saying, okay. Well, we're not gonna do if you're exceeding CPI increase, we're not gonna do wildfire mitigation, and that's gonna be taken off the plate, or we're not gonna do, you know, public programs.
I mean, what how does that work? I just I just don't understand how this overlay you know, we have a we have a regulatory program which is supposed to be looking at costs for the benefit of our rate payers and assuring that the costs are, you know, only those that result you know, in a fair return for the utilities. And so I guess I just don't understand how this overlay works.
Redner 42
Right. So, well, hopefully, I can try to clear that this up for you. So there is no mandate with this. It's the in in regards to the the constrained rate case is to basically show us inflation. Just like we have to live within means, we wanna make sure that our utilities are within means.
So that is a scenario. Of course, they're gonna show additional, you know, scenarios as to your point about making the investors whole when it comes to wildfires and things like that. But we wanna make sure just so think about water utilities. We don't allow we don't charge over the price. And when you when you speak about these things and we talk about how our, you know, our price of eggs and etcetera, those things are happening, we've also seen that in in our case where utilities have actually, you know, come to us and they've needed to ask for investor returns as as example.
So we need to be able to justify things because we our inflation is not keeping up the cost of living is not keeping up with our utility bills, and we're outpacing inflation, and people's income is not matching. So when you're asking how it works, there will be a constrained rate case, and then you can with as we said, with the clear evidence, we wanna be able to see what you're getting. I think of it the same way as we would run any other household. My kids come to me. They ask for something.
It costs a certain amount. If there's an alternative, let me see why you have to have this particular brand versus that. Give me give me the the information. Let me be able to see if we can get something, you know, that will still keep you give you what you need, but maybe it doesn't cost as much. But we want transparency.
The entire goal of this is to be able to have the the transparency. So we want fair and informed rates. Right now, we don't get that transparency when we are paying these bills. And so that is something we wanna know what we're getting for our money. I'm gonna give it to the witness who can probably be more eloquent.
Sorry.
Redner 3
Thank you. Thank you for the question, assembly member. The way that it would work in the general rate case is the utility presents their preferred scenario Preferred. Which is what they typically do. Here's how much they want.
But they would also need to present an alternative scenario, and that alternative inflation constraint scenario is designed to force the utility to prioritize their spending. Part of the problem we face when we litigate cases in front of the Public Utilities Commission is if you ask a utility, what is your highest priority spending in this particular proposal? Their answer is all of it. Everything. Everything.
This is designed to force them to separate their needs from their wants in an inflation constrained case. They don't need to argue for it. They can argue against the commission adopting it and say, no. Adopt our preferred spending scenario. And the commission is not required to adopt the inflation constrained scenario.
It's designed to give us a benchmarking approach to understand what would it look like if we prioritize spending and limit it to inflation. And it would give parties in the case an opportunity to then argue for or against that. But without the utility presenting it, it it then forces all of the other parties to sort of guess at what would be the highest priority spending. I think that's what we're really trying to do in the regulatory process.
Redner 18
So could you just give me and I don't wanna belabor this too long. But could you just give me examples of how a inflation constraint scenario what kinds of things would be omitted? I mean, if you actually need to engage in wildfire spending, would you basically have a scenario that you're just doing less of that or delaying it? I mean, it it seems like most of what's in these in the rate cases is a combination of things that we've mandated the utilities to do. And so we would have a scenario where they're not doing things that we mandated or we would delay them.
I guess I just don't understand I mean, what what this constraint scenario how that's different from they basically saying, okay. They want an x percent increase in the rate, which is 10%, and the inflation rate is 3%, and the PUC says, okay. It's 7% above inflation. I mean, so how is how is the constrained scenario different? What would be eliminated from the scenario?
Redner 11
-And if may interject sorry. Then I'll let you comment. If I may interject. Because I think the question you're asking is exactly the conversation that this is meant to force.
Redner 11
-And I actually feel like I'm having deja vu, because I think we've heard this bill a couple times. So I think that the issue right now is that, I think it feels for many of us that we're sort of missing the forest for the trees. And everyone says, oh, we're about to bend the cost curve. We're driving down rates, and they continue to accelerate. And I will say the opposition is right that this is not just because IOUs are making crazy business decisions.
This is because of some mandates that have been passed by this body. But in the absence of forcing this conversation and these trade offs
Redner 11
We don't have that visibility to understand, oh, shucks. Maybe we do need to make some changes. So I feel like this is, like, you know, the con the conversation that would be had is, like, okay. Here's my inflation constrained scenario. Here's my preferred scenario.
Here's my inflation con inflation constrained scenario. Here's what I'm spending with wildfire investments in my inflation constrained scenario. My preferred scenario, I'm gonna spend more, and this is what you're getting for it. You know, here's and I would actually not mind if y'all included in your inflation constraint scenario. You zero you can zero out the public purpose programs or zero out the state mandates and make people understand What's the cost?
What is driving these costs. Because right now, we're trapped in this situation where many of the, you know, many of the same people who are, like, lambasting the IOUs for runaway rates are supporting programs that are driving the runaway rates. So I think this is incredibly important as a step to force that transparency, to force a meaningful conversation about trade offs, maybe to force a conversation about, hey. Does wildfire spending even should it continue to be in rates, or do we pull it out? So that is why I've supported this proposal for my time as chair and will continue to do so.
And similarly, mister Wetch, I think, you know, a conversation we've had about this issue has been when the when the proposal was initially, we're just gonna mandate an inflation constrained scenario. I understand why that is deeply unfair, but I think forcing that conversation, think that makes sense. So I interrupted our amazing author and her witness. If I can turn
Redner 11
Okay. Did did you want to respond? I think mister Friedman, I interjected.
Redner 3
Okay. Ask that question. Thank you, madam chair. The in response to your question, as somebody member, there are state mandates, but the state doesn't mandate exactly how much the utility needs to spend. I think that's a misunderstanding of how it plays out.
The utility has plenty of discretion in how it meets any state target that has been established, And the utility has many pathways to getting there, some of which are more cost effective than others. And, of course, the general rate case covers all areas of operations. It covers everything the utility does, many of which have no specific mandates. And we are looking to ensure that the utilities tell us what it would look like for them to spend less, not just sort of an across the board cut, but more surgically, on particular areas of operations. And I don't think that it has any impact on wage negotiations.
Certainly, the utilities would be able to argue
Redner 3
In their case before the PUC that certain costs were needed to ensure the safe and reliable operation. That's actually in the bill. It it refers to safe and reliable operation of the system, costs that are necessary for that purpose. So I really feel like we've we've identified the safety issues as paramount here, but the utilities have so much discretion in what they propose, and there's a lot of fat in these in these applications. We do our best to try to knock out the stuff that we identify.
For everything we find, there's five or 10 things we don't find because the utilities have superior information.
Redner 18
I'd like to understand and answer the same question. So what how would this play out, I guess?
Redner 27
what you need to have happen, which is not in this bill, is you'd have to require that in this constrained to get to your point, to to in this con inflation constrained GRC, you really would have to have them list everything that's not going to be done. Right? So the so that you know, because this this all goes before an administrative law judge, you know, and and it's like baseball arbitration. It's really about trying to come to a settlement amongst the parties, and then it gets to the commissioners. The commissioners aren't doing the the deep dive on this.
So to really have that value assessment that the chair spoke to, you really have to require that that includes, okay, here's a CPI constrained GRC. What's not in it? What's not happening that should be? And to give you an example of how this works, just a number of years ago when we were looking at poll replacement, I think it was PGD's GRC. You know, you know, the the the company came in and said, we need to replace x amount, let's say, 800 polls in during this or a thousand polls during this this cycle.
We came in with the data that showed that really double that needed to be replaced. And ultimately, Tern and others came in and and said, no. That's both of those are way out of line. It should only be a small percentage of that. So what got adopted was a poll replacement of about two hundred years per poll.
The life cycle for each poll under that scenario is two hundred years. They don't make polls the last two hundred years. Then we wonder why we don't have reliability. So you you you really have to look at the qualitative pieces of that too, not just getting to CPI. And on the on on the the wage issue, this is what will happen.
You go to negotiations. They'll say, we can only do two and a half percent because we're mandated to provide this. We'll reach an impasse. A mediator will come in, and they'll show them the law and say, see, the legislature is mandating that we have to provide a concession. That means we can't give and if we get a bad mediator, which we often do, we're gonna be stuck with that two and a half percent.
That's how that will play out.
Redner 18
Thank you. I appreciate the answer on both of those. I guess the other thing I'll just sort of say is I'm very this doesn't seem like it's just transparency thing to me because we're changing the standards. So I don't understand how the clear and convincing and the the standard changes don't push the PUC away from being able to make decisions that they think is in the best interest of the public and the rate payer because they are sort of pushed to the rate constraint scenario because of the standards that are being imposed. So
Redner 42
So can you explain that when you say you don't see I'm sorry. Madam chair, is that okay? Can you you said you don't see you you feel like they would be pushed. Why why would they be pushed if they can do the we're asking for the constrained rate, and then we're asking them to basically show the other rates the details on the other rates. So you're telling me that can you explain what you mean with with that comment?
Redner 20
I just I'm nervous about the higher standard that would be put in place. For example, look just going to what mister Wet said about a rate case where you actually are, you know what they're trying to decide is how many polls need to be replaced in a certain amount of time. I mean, what is clear and convincing evidence about whether or not it should be 300 polls or 600 polls or 1,200 polls? I mean, I just don't and those if the inflation constraint scenario basically says that it's you know, that only certain amount of polls are consistent with CPI a CPI increase, then it's gonna be hard for them to to basically approve what is actually needed for the public because we not only have we provided more information, I think along the lines of what the chair has said, but we've actually changed the standard in terms of what they can approve and not approve. So anyway We're
Redner 42
not changing the standard. We're giving them an opportunity to provide an alternative and to show how they are prioritizing the rate payers and and and they're making in their decision making. So at the end of the day, we're not saying they we we're not saying there's a 30 cap. We're not saying there's a you know, you cannot you have to go with the constrained rate. But we want transparency.
We wanna see, like, what what efforts did we make to put the public first.
Redner 12
No. You're all good. Look. I I think I think this is one of those bills where there's just so many different facets to it that it's it's tough. Yeah.
I'm gonna give you a lot of grace and a lot of latitude on it because I I know what you're trying to to do. I think you heard the concerns around the employee negotiations. I didn't see any letter that referenced it, but maybe I just missed it.
Redner 42
No. I did not hear from any opposition in regards to this until right now.
Redner 12
And so I I hope I hope that you'll work with the opposition on that piece after because I know that that's that's something that probably you'd be interested knowing you and helping to
Redner 42
Oh, 100%. 100 be willing to, especially, I definitely understand concerns about, our workers. Right? And we can't do this work. We can't have a solid utility infrastructure without the workers.
So we thought that we we'd kinda made that clear in the bill, but, to mister Wech's point, he feels that there's concerns. That's something that we will wanna ensure that when we are making these considerations, and you can't do this work without the workers. Right? So if your your rate scenario needs to say, you know, we have to make sure that we have the workers, and they clearly are we're not gonna ask for people not to be paid a fair wage. So, this bill does not take seek to take away any of that.
Redner 12
Yeah. And and I just wanna give you a chance to say that Thank you. Because I I assumed that that was the case, and I think that that does allow, some of us to feel a little bit better if this bill was were to move forward that you'll you've made that commitment to work with those folks on that. Absolutely. I think part of the challenge for me in in reading the bill is, I think that there's a significant portion of the public who feels like some of these IOUs, that the investor did well at certain times and maybe cut corners.
And that now we're playing catch up in a lot of ways, and that's part of why we see the rates happening the way that they are and now feel caught between a rock and a hard place where somebody else already got theirs. And now our only options are either to have inadequate infrastructure or or pay more. Right. I I think that that's where this is a is a challenge, and I and I understand what you're trying to do. My question was actually about the the choice for the CPI.
And I know in the analysis, it explains that you chose a broad CPI consistent with Social Security because lots of folks are living on fixed incomes, and that certainly makes sense to me that that's what you were looking at. But from a practical standpoint, things cost more in California. Things cost more in the Bay Area than they do elsewhere. You have different metrics for CPI that each region can use based on the actual cost to deliver a service or a good. So if this goes directly back to how much you pay your employees, it goes back to how much it costs for you to procure the equipment.
In my mind, it makes I I understand from the senior perspective in protecting people on a fixed income why you went the direction you did. But from a service delivery perspective, it seems to me like it makes more sense to have CPI tailored towards the area that we actually are gonna be delivering these services. But I want to give you a chance to respond.
Redner 42
Sure. I can give you the rationale, or I can pass it over to Matt to expand on, you know, what you're saying. But I will tell you, one of the things that we were considering is the max amount of income increase most ratepayers perceive each year. You
Redner 42
if the ratepayers have a budget, then utilities outpacing their their budget. Like, you know, it's not sustainable at this point. And then number two, the goal is based on the consumer price index for urban wage earners and clerical workers, which is a measure of inflation. But, you know, we we definitely are happy to continue working on that. And then I will give it over to Matt to please expand on that because I knew you were gonna ask that question.
Redner 3
Thank you, assembly member. The to reiterate what was just said, the Social Security cost of living adjustment is actually based on the consumer price index. It is the it is the CPI dash w, which is the consumer price index for urban wage earners and clerical workers. So we think that this not only reflects the annual increases in benefits received under the Social Security program, but also the actual wage increases that typical urban workers would receive. So we think it's a good proxy in that respect.
Redner 12
Okay. That's helpful. Thank you. Like I said, I'm I'm gonna give you a lot of latitude and leeway because I know what you're trying to do. I reserve judgment for when it comes to the floor, assuming it ends up coming to the floor, but I did I was struck by a line that was in one of the opposition letters that I think I don't want this to be a cut off your nose to spite your face for the public on something that feels good but ultimately harms them long term because they're so frustrated with the system.
And the line was that as written, the bill doesn't discipline shareholders and only ends up hurting the workers. And I know that that's something that you take very seriously.
Redner 42
I definitely do. And I thank you for for bringing that up. And as mentioned, we'll be happy. I was gonna bring it up, so thanks for asking the question. We'll definitely be happy to continue that that conversation.
It was already our intent, but if if they don't feel that it was clear enough, we wanna make sure that it's clear. And this bill is not putting any caps. Right? We just we need to we need to fight for transparent information. Right?
So we're not putting a cap, but thank you for that, and we will continue that conversation.
Redner 30
Thank you, manager. I appreciate the time, and I certainly appreciate the the intent of our author. And I think if you look at any type of legislator in the state of California, our constituents, one of my issues is affordability. One of my concerns is that what was earlier alluded to that this is not a legislative mandate. I'm not 100% in agreement with that.
In the very least, I believe that there's going to be additional programs and regulation. And I believe that sometimes when there's additional layer of process here, that it's not going to be something that is commensurate to see taxpayer or ratepayer relief. One of my questions that I have specifically, actually, with the opposition that they may answer is whenever you're going to enforce to create a new program or to have a new requirement upon the CPUC or the IOUs, what do you foresee in terms of additional cost, and will that end up going to the ratepayer?
Redner 23
Yeah. I mean, look. State policy mandates are obviously a significant portion of rates today. It is a growing portion of rates. I don't know how in this process.
Right? You know, certainly, they've presented this you know, the the process that they're looking at is you present your inflation constraint scenario, and you also present your general rate case. It's possible that, you know, in that inflation, you know, as the chair noted, you might just zero out the thing that the state's telling you to do. Is that an optimal solution? I don't know.
I I again, I look at this. This feels like it's it's kind of nibbling around the margins when we should actually be tackling the real cost drivers, the things that are actually pushing rates up. Those are things you know, I mean, if you look at it, I think the average across the IOUs, the NEM cost shift is the on average, 14.2%. That's massive. That's much more than, for example, is being, paid for, for Care and Farrah.
Right? It's substantial. It's multiple times more. And those benefits are going to people who are in higher income brackets. Right?
So let's focus more on pulling back those state policy mandates out of rates rather than this, you know, hey. We've got this balance of an inflation constraint scenario with the heightened standard that's trying to serve as an anchor to pull things down. Let's actually address the meat.
Redner 30
Thank you for the answer. I I do have one last follow-up question. I noticed in that at least I didn't pick up on it in terms of the legislation and the verbiage. So is there an off ramp for environmental causes? It is part of the consideration in terms of financial impact for the IOUs and CPUC.
Redner 30
Right. Right. Because right now, it's limited to safety and reliability, but I think it does ignore some of the costs that are added to the system.
Redner 42
So when you say offer so when we are looking at the so there's the constraint case, and then there's kind of this prioritization. It's gonna give, like, clear transparency, clear priorities, things that, like, must be done versus things that we don't have to do in this particular rate increase. As far as, like, an additional, like, way to off ramp, maybe Matt can speak to that. But we wanna make sure so as you were speaking about, you know, some of the how we identify what some of the problems are, we can I I really think it's important for us to see where regulations are, some of the things where when you make this transparent, you can say, well, unfortunately, we can't leave this out because it's a regulation? Really, I I think this is really another tool to help the legislature be able to say, well, this is where we're actually not helping the PUC when it comes to our rates.
So this is not about just putting the onus on utilities. This is about making things so transparent that we completely understand what are driving our costs the same way you do when your costs at home are out of control, and you're like, wait a minute. Why why are now all my bills are so high? I was just walking over here. I got a text from the insurance company.
I'm like, my daughter must have done something because my insurance just went up $300. Right? So, like, with information, we can make changes. And so that's what you know, those are the type of things that we're expecting. But as far as off ramping, I don't really have context for that.
Matt, can you speak to that, please?
Redner 3
Sure. Well, I the bill has two components. The first component deals with the general rate case, which you would think includes everything, but in fact, it does not. There's a lot of spending that is outside of the general rate case. The second part of the bill refers to other proceedings.
And a lot of the environmental mandates that the utilities have to comply with, the clean energy standards in the state, those are dealt with through different proceedings outside of the general rate case. And there, the PUC would be directed under this bill to apply heightened scrutiny. So it it provides kind of a general off ramp, but directs the commission to take a harder look at increases cumulatively across other proceedings that would exceed inflation. So I think it leaves wide latitude for the types of off ramps that you're identifying, and it does not specifically link the commission's review to safety and reliability.
Redner 43
Thank you so much, madam chair, and I promise this will be my last question. Just to piggyback on that, when I meant specifically the off ramps when it comes to environmental programs. Because when environmental programs are assessed or accounted for, I imagine there will point to be an increase potentially to rates, specifically for the reliability programs? Because this excuse me. The environmental programs because this one is specifically for reliability and safety as I understand it.
Redner 3
Well, yes and no. The the general rate case one, looks at safety and reliability as a legitimate basis for going above inflation. But in the other proceedings, there's no there's no similar limitation. And, again, many of the utility spending programs that deal with environmental policies are outside of the general rate case. That's very typical, and that would be subject to a heightened scrutiny standard.
That's the idea behind the bill. So it's it's designed to recognize that there are legitimate state policy requirements that the utilities have to comply with. This is not attempting to get around that.
Redner 23
Look. I think that it's it's been stated correctly. You know, we've gotta reconcile all of these different things that we're asking the rate payers to bear. Right? And so the logic of of what you're saying, I I don't necessarily disagree with.
But, again, my my fundamental objection here is you are dragging down. The idea of this is to anchor as low as possible, right, to use a negotiation term and increasing the heightened standard over the long term that has the potential to really start pushing deferred maintenance into the system, right, to to delay upgrades. And so that's kind of the overall concern. The main point here, though, for for me at least, is let's start taking the things that don't belong in rates out of rates. That's where we should be putting our focus.
So
Redner 39
Well, thank you so much for that sage advice. This committee, over the course of the last many, many years, has been really deeply engaged into digging into the drivers of rate increases and identifying opportunities for legislative intervention, to address that and bring rates down. I guess what, well, I'll I'll first say I'm quite shocked to have the chamber opposed to this measure because one of the number one things that I hear from businesses large and small across the state of California is their deep anxiety, frustration, and concern about runaway electricity rates. And then second, you know, you continue to say that we should be focused on pulling state policy mandates out of rates. I actually don't dispute that, but that doesn't need to be an either or.
Redner 11
And I guess I'll, you know, once again say, I think that this bill is incredibly important for forcing tough conversations because I think we would all love to live in a world where we can have our, you know, wish list and all have a, you know, a unicorn and a pony still have affordable rates, that's not reality. And so I think foreseeing conversations about trade offs, whether we're talking about the state budget or in front of the PUC, is incredibly important. You know, it's why I've been a supporter of this bill. I'm really grateful to the author for, introducing it, and I'm very happy to support. So Thank you, ma'am.
That, I don't think there's any other questions, comments. Oh, Sheyaba. Assemblymember's Sheyaba.
Redner 43
I just, there's been a lot of discussion, but I just want to make sure this is clear. This doesn't require any certain acceptance. Right? So this is just presenting the information, and then the decision is still can be made either either way.
Redner 43
Right. So this is I mean, it's simply transparency. Right. And then and I think the point that you made is an important one, about there's there's a lot of fat. Right?
Redner 3
And that's why you need the transparency because you don't know. We don't know enough about how rates are being made, about what's in them and what's not in them. You know, I went on a a utility tour and heard about something that they were keeping around because they can write it off. You know, there's a lot of things that are happening that are are hurting customers in the end. I think, you know, certainly wanna be cognizant of concerns around you know, sometimes labor is pushing for things that are higher than inflation, and that, I think, would need to be kind of figured out a little bit.
Redner 43
But at the end of the day, it's still not requiring them to accept it. So it just seems like more transparency would also be helpful for labor negotiations because you have more transparency going into it, to know, you know, what what they're including, what they're not, and how things are being charged. So I'll support it today. Thank you. Thank you.
Redner 42
Well, yes. I'd like to thank everybody for the robust conversation. Some questions we expected, others we didn't, but I think that is the the important part of this exercise is to be able to make the case. This is about, you know, fighting for the affordable and transparent rates for our customers, and that means that we have to be more diligent of our review and utility spending and also how our legislature does impact utilities. So as I I appreciate the opposition for you for bringing your concerns to the table, and I think there's a lot of agreement.
We wanna make sure that we're protecting our workers, and we wanna make sure that we are, as a legislature, being responsible for how we impact rates as well. And we cannot do that without this conversation and without that information. At the same time, this is a a business friendly bill. We we are hearing a lot from businesses hurting. We're hearing from our school districts, 5,000,000 increase in one year for a school district as budgets are being cut.
So we have to find ways to all live in the world together and make responsible decisions the same way what we do for our families. That helps and supports each and every one of that us. So, with that, I respectfully ask for your committee's I vote, and I thank you for the time today.
Redner 11
Thank you. Thank you. Alright. I respect that. Madam secretary, will you please call the roll?
Redner 29
Item number 12, a b twenty three thirty eight. The motion is due passed to appropriations. Petrie Norris? Aye. Petrie Norris, aye.
Patterson?
Redner 29
Calderon not voting. Chen? Chen, no. Davies? Gonzalez?
Herbidian? Aye. Herbidian aye. Hart? Hart, aye.
Erwin?
Redner 29
Schiavo, aye. Schultz? Aye. Schulz, aye. Wallace?
Zipper? Not voting. Zipper not voting.
Redner 11
Okay. Eight one, that bill is on call, we'll leave the roll open for absent members.
Redner 42
Okay. Well, thank go. I'll Alright. Well, let's go. Alright.
Thank you, madam chair and committee members. I'm here today. I wanna, first of all start by thanking the committee for the work on this bill and stating that I am going to accept the committee's amendments on behalf of the Emergency Management Committee. I'm here to present a b twenty five forty three, a bill that will strengthen emergency preparedness in the electrical vehicle direct current fast charging station sites across California. Because California has been disaster prone, vulnerable to wildfires, floods, earthquakes, how we prepare and respond can make the difference between lives saved and catastrophes prevented, it's important that we look forward in our state.
Despite these disasters, California is also making major commitments to a more sustainable future through zero emission vehicle adoption and clean energy expansion. And as transportation electrification increases in California, what role public charging sites should play in emergency plans will become even more relevant. It is important for Californians to retain access to critical charging services when they are needed the most. The importance and role of EV resilience during natural disasters is recognized at both the federal and state levels through California's clean transportation goals and the Federal Highway Administration's national national electric vehicle infrastructure program, mouthful, which encourages consideration of reliability and emergency preparedness in charging networks. Additionally, VCPUC has identified the need for innovation to ensure EV resilience during natural disasters and widespread power outages.
But emergency preparedness in the EV sector during an active emergency remains unexplored, underscoring the urgent need for clear guidelines for direct current fast charging operations in the event of an emergency. Emergency plans that considers EV charging infrastructure typically relax or suspend the usual regulations and standards governing operations. While this is understandable in the interest of life safety, we should still aim to mitigate preventable gaps by establishing baseline expectations, identifying critical assets, and plan for emergency continuity so Californians can make the best use of available resources under emergency flexibilities. I also wanna recognize the landscape of this work being one that has not been explored to the level that we are now attempting to do with this bill. As the bill moves through the process, we will continue to work with entities referred to in the bill.
AB two five four three addresses the issues outlined by identifying what is needed for comprehensive emergency plan involving all relevant entities. I respectfully ask for your I vote at the time. And if you have any technical questions, I have Uddbad, who serves as our science fellow on the emergency management committee, to help. Wonderful. Thank you.
Redner 11
Thank you. Alright. So we will go ahead and open it up for any witness testimony in the room. If you'd like to approach the microphone at this time in support of AB twenty five forty three. Alright.
Seeing none, any testimony in opposition?
Redner 27
Good afternoon. Lizzie Guanzona here on behalf of Tesla. No formal position at this time. Just want to briefly express that we have some concerns about the current language, but we've really appreciated conversations with the author's office and committee staff and look forward to continuing those conversations. Thank you.
Redner 21
Kai Klausen, on behalf of the Electric Vehicle Charging Association, similarly to Tesla, we have voiced our concerns in a letter submitted to the committee, so we're in a tweener spot. But we understand the author's contempt. So thank you.
Redner 11
Thank you. Okay. Bringing it back to committee. Assembly members of her.
Redner 18
So first of I wanna thank the author for, her always, dedicated leadership on really making sure that our communities are planning for the things we need during emergencies. And, you know, as we move to a clean energy economy, the planning that we're gonna need as we actually, you know, move towards electrification of our transportation sources is is really an important thing. So I think this is really an important bill, and wanna thank you for bringing it, and I'd love to move it. Alright.
Redner 11
Well, I'll just say thank you to the author, the chair of our Assembly Committee on Emergency Management for bringing this measure forward. Happy to support. And would you like to close?
Redner 42
Yes. Well, thank you for the motion and the second. This bill is very simple. As we move towards electric vehicles, we wanna ensure that the EV charging network is thoroughly prepared to remain reliable during emergencies and natural disasters as we will have more electric vehicles over the coming years. And with that, I respectfully ask for your I vote.
Redner 11
Did I miss you? Okay. Thank you. We've got a motion in a second. Madam secretary, please call the roll.
Redner 29
Item number 16, a b twenty five forty three. The motion is due pass as amended to appropriations. Petrinoris?
Redner 29
Petrie Norris aye. Patterson? Aye. Patterson aye. Burner?
Calderon? Chen? Chen aye. Davies? Gonzalez?
Herabidean? Aye. Heart, aye. Erwin? Aye.
Erwin, aye. Colra? Aye. Pappin? Rogers?
Redner 29
Rogers, aye. Schiavo, Schulz? Aye. Schulz, aye. Ta.
Wallace? Zaber? Aye. Zaber, aye. Alright.
Redner 11
90. So that measure's on call. We'll wait for absent members to add on. Thank Thank you, Assembly you. Okay.
Moving on to item file item 15, a b twenty five eighteen. Assembly member Sharp Collins, welcome.
Redner 29
Alright. Since you guys already moved the bill. Good afternoon, madam chair and members. I would like to begin by thanking the committee for working with my staff on this bill, and I will be accepting the committee amends. One thing that I would like to point out is that assembly bill twenty five eighteen is a district specific bill that creates a five year pilot program in San Diego County to address energizing delays across various sectors.
Redner 49
So with me to provide testimony to in in support is Israel Salas, governmental affairs manager at San Diego Gas and Electric, and also Frances Baraza, vice president of policy for San Diego Housing Commission.
Redner 6
Thank you, assembly member, and thank you, chair and members. My name is Frances Braswin, vice president of poly first policy for the San Diego Housing Commission. We come before you today in strong support of a b twenty five eighteen because we have lived the problem this bill is designed to solve. The San Diego Housing Commission develops, finances, and oversees affordable housing across San Diego. Affordable housing development projects in San Diego have faced significant unpredictable delays in utility energization after construction is substantially complete.
Redner 11
These delays occur even when a project has met all preenergization requirements and is physically ready for connection. The delays impose substantial financial harm on affordable housing projects that operate on thin margins and are subject to strict compliance deadlines under their financing structures. Additionally, it can delay or prevent the most underserved and vulnerable from getting a roof over their head. This bill corrects an operational practice, that can disadvantage affordable housing development by treating it identically to standard residential or commercial new connections despite, the distinct public benefit, significant public investment, and financing urgency these projects carry. The Standard Housing Commission's Homekey Project Pacific Village, a 127 permanent supportive housing project, encountered an SDG and E related connection delay only to be remedied by our unique connection to SDG and E leadership.
Redner 6
This project was funded using state and local taxpayer dollars and was delayed by several weeks to get connected because of class classification and energization delays. What AB 25 eighteen's category one forty business day timeline would have meant for Pacific Village. Instead of an open ended queue with little accountability, we would have had to define deadline that provided assurance our project would be connected in a timely manner. AB twenty five eighteen takes a targeted data driven approach. Rather than a blunt mandate, it establishes a five year pilot with category specific timelines.
Forty business days for category one projects like affordable housing, fifty five for municipal municipal and EV infrastructure, seventy for everything else. This structure is smart policy for several reasons. It acknowledges that not all projects carry the same public urgency. When an affordable housing project sits dark and empty waiting for utility connection, real people are paying
Redner 7
Thank you, madam chair. Israel Salas with San Diego Gas and Electric, echo, the author's statement, our appreciation for, your staff working with us on on landing this proposal. I'll be brief. You know, we we we do welcome the opportunity to pilot process improvements, to support policies that advance critical community needs while maintaining safe, timely, and reliable project delivery. So, we recognize that this is a targeted solution.
Redner 15
This is the second time in as many years that we've had an opportunity to partner with the San Diego Housing Commission on legislation. So we are looking forward to to continuing the partnership that we have with with our local partners. And so with that, ask for support today. Thank you.
Redner 11
Thank you. Okay. Additional witnesses in support of this measure. Approach the microphone.
Redner 27
Madam chair, members Scott Wetter, on behalf of the California Coalition of Utility Employees, in support.
Redner 11
Thank you. Alright. Witnesses in opposition. Just in opposition. Okay.
Seeing none. Bringing it back to the committee, assembly members of Burr.
Redner 18
So, member, I love this bill. Thank you. I mean, we've heard all the stories about delays in energization and, of course, when it's affecting affordable housing projects who are operating on thin margins and we're actually financing them with public dollars, I think this is really even though this is a district focused bill, I think it's it would be a great template. I'm glad it's a pilot project hoping that it could be expanded, and I'd be honored if you'd allow me to be a coauthor.
Redner 7
I also wanna say thank you so much for the bill, and I'd be honored to be a coauthor.
Redner 11
have Thank you. Alright. And I too want to thank the author for bringing this bill forward. I also want to thank SDG and E for working on this bill. I think this is incredibly exciting.
You are setting very ambitious, also very clear timelines and expectations for everyone and every stakeholder in your service territory. And as, you know, some folks on the committee may recall, in the past we've had bills that would prioritize one sector over another, but with no clarity about what that implication's gonna be. And I think there's always been some concern that, oh, if you're just squeezing the balloon on this side, there's gonna be this endless delay. So your willingness, you know, and with Assembly Member Sharp Collins' leadership to set really clear and I think very ambitious timelines across your service territory, I think is awesome and it's very exciting with that. Assembly Member, would you like to close?
Redner 49
so I'm just gonna close by saying I respectfully ask for your item, and thank you so much
Redner 11
for working with me on the bill. Thank you. Okay. You've got a motion and a second. Madam Secretary, please call the roll.
Redner 29
Item number 15, AB 2,518, the motion is due pass as amended to appropriations. Petrie Norris? Aye. Petrie Norris? Aye.
Patterson, aye. Burner? Calderon? Aye. Calderon, aye.
Chen? Aye. Chen, aye. Davies? Aye.
Davies, aye. Gonzales? Aye. Aye. Part aye.
Erwin? Aye. Erwin, aye. Culra? Pappin?
Rogers?
Redner 11
Oh, that's twelve zero. So that bill's out. We'll leave the roll open for absent members to add on. Let's move to file item 13, assembly member Rogers. A b twenty three sixty nine.
Thank
Redner 12
you. Chair, I have to tell you, my witness told me he had props for me, that I was doing a good job. But it turns out he means a poster. So with your permission,
Redner 11
We did know that was a poster, and we gave our thumbs up on it in advance. I didn't realize the dimensions of the poster. Is that is a that is a large that is a large poster.
Redner 11
There you go. So no one will need to wear their readers in order to enjoy your presentation. That's Someone asked for a
Redner 12
Okay. So, first of all, thank you everybody for taking the time. We are presenting today a b twenty three sixty nine. I don't need to belabor the point too much. This committee has talked a lot about the way that our lack of transmission capacity has constrained, renewable energy projects.
Redner 40
Specifically, in my district, we have a lot of opportunity with offshore wind, with geothermal, but we do see bottlenecks based on the transmission capacity. I think many of you were in a select committee that we did not too long ago where I was expressing frustration with the CPUC and CAISO process, for RPS wherein which one of the components of how they determine their infrastructure investments in the planning is based on the shovel readiness and and the projects that are coming in. And it's a chicken and the egg for us where without the infrastructure, folks aren't moving forward as quickly, with renewable energy deployment. And that's a severe disadvantage to our community, not just from an environmental perspective, but also from an economic perspective in an area that that desperately needs it, in an area that the Jobs First initiative has really identified as a core deliverer of renewable energy. As a result of that, what ends up happening is our projects are deemed, to be insufficient for for delivery and energy only projects.
Redner 12
So what our bill does is really simple. It actually just requires the CPUC and Kaiso to develop a methodology for evaluating the contribution of energy only resources for the purposes of, sufficiency for energy storage. I wanna thank the staff for working very closely with us on the bill to get it to this point, but we also thought that it was a really good opportunity to highlight exactly the challenge that we're trying to solve in Northern California and in particular in rural communities. So I appreciate you allowing the poster, as large as it is, but I think that it's a really stark visual for the challenges that our community is facing. I'm gonna turn it over to Miles Horton with Sonoma Clean Power to talk a little bit about it as well.
Redner 45
Thank you so much, madam chair, members of the committee. Miles Horton with Sonoma Clean Power. So just to walk you through what we're seeing here, this is a map of CAISO territory. You can see, Baja California at the bottom, Nevada to the to the right there my right there, and then obviously the the ocean on the left. And this shows where new clean energy resources can be built and interconnected to the grid and receive resource adequacy value, which is really the attribute that makes these projects pencil out.
And what you'll see is that in the orange and even the light green, there's very little essentially no ability to build new clean energy and assign that resource adequacy because of transmission constraints on the system. And so this problem has, you know, probably always been in place to some extent, but has really exploded in the last couple years where now most of the state is functionally off limits to new clean energy projects. And what we're seeing is, you know, we're seeing this in our in our own territory, solar, geothermal, all sorts of things are trying to move forward but are just running into this issue where they try to interconnect to the grid and are forced to drop out and the project falls through.
Redner 12
Is that And if I can interject for a a quick second, you had a statistic about what percentage of projects actually get into the pipeline and fall out of the pipeline as a result of this inadequacy?
Redner 45
Yeah. I think let me know if this is what you're thinking of. The in the last round of interconnection, which was called cluster 15, you had over 10 gigawatts of projects. Real projects that were moving forward fall through because they couldn't get interconnected with resource adequacy value, and so the project wasn't able to happen. And that I mean, that's a huge amount to begin with.
Redner 10
But on top that that doesn't even include all the people who didn't even start because they knew they'd run into this problem. Right? So it's really it it's just briefly, and then I'll wrap up. It's causing some very negative effects where, you know, it's it's preventing us from getting the clean energy we need to meet our climate goals, especially things like wind and geothermal that can't just relocate to where the transmission's available. It's negatively impacting affordability because as the load serving entity, we can't go after cheaper, newer resources.
Redner 45
We're stuck with older, more expensive, often more polluting resources. And then it's actually very bad for reliability too. I can go into this more, but, yeah, happy to take any questions.
Redner 11
Thank you. Okay. No. No. Opening oh, you know what?
Vanessa is such a pro. She paused the timer when mister Rogers spoke so that Miles did not need to reclaim his time. Okay. Opening it up for additional witnesses in support. You can approach the microphone at this time.
Redner 1
you. Melissa Cortez on behalf of the California Wind Energy Association in support of the bill.
Redner 29
Good afternoon. Panarea Abtiz on behalf of the Abundance Network cosponsor in support.
Redner 11
Thank you. Alright. Moving to any witnesses in opposition. Go ahead and come on up.
Redner 22
Madam Chair, I'm just gonna go from here. Since we we were we were opposed on file, it sounds like the author's gonna take the appreciate the committee analysis, and they the author's gonna take the committee amendments, and we're gonna remove our opposition based on those amendments.
Redner 11
Thank you. Yep. And, actually, would the author just confirm that he's accepting said committee amendments?
Redner 12
Okay. Thank you. I think, Laura and my legislative director would both murder me because they worked so hard on those amendments. So thank you.
Redner 11
All right. Any additional witnesses in opposition or with a tweener positioned to register? Seeing none, bringing it back to committee.
Redner 11
Okay. Seeing no, questions or comments, thank you to the author for bringing this bill forward. I think it's really important, like as you said in your opening comments, kinda trapped in this chicken and egg situation, which is very problematic. So appreciate your focus on this and the work you're doing on the bill. Yeah.
With that, would you like to close?
Redner 12
Yeah. Just a a thank you to the chair, thank you to the staff. And then I hope as you all are stuck listening to me complain about this and talk about this in this committee and in our hearings, I hope that you'll have this visual going forward to understand not just what my district's dealing with, but all of California. I think it's something that we should all be able to unite around to try
Redner 11
Alright. We've got a motion and a second. Madam secretary, please call the roll.
Redner 29
Item number 13, AB2369, the motion is due passed as amended to appropriations. Petrie Norris? Aye. Petrie Norris? Patterson?
Redner 29
Patterson, eye. Burner? Calderon? Aye. Calderon aye.
Chen? Davies? Aye. Davies, aye. Gonzalez.
Arabidian? Aye. Arabidian, aye. Hart? Aye.
Hart, aye. Erwin? Aye. Erwin, aye. Culra?
Pappin? Rogers?
Redner 29
Rogers, aye. Schiavo? Aye. Schiavo, aye. Schultz?
Ta? Wallace? Aye. Wallace, aye. Zaber?
Aye. Zaber, aye.
Redner 47
The vote to 11 to zero will, keep it open for absent members. Thank you. And you're presenting, a b 2710 for, Bauer Cahan?
Redner 12
That's right. Alright. Perfect. Yeah. Members, I am a poor man's RBK, but proud to present for her a v twenty seven ten, the leading with love act.
This bill is a transparency bill that would require IOUs to submit a report to the legislature when an IOU enters or a qualified institution, deems their credit to be, the the term is near distress. That would give the legislature more of a runway to be able to proactively address the impacts that could happen on ratepayers. This data, as I understand it, is mostly already available. It would just pull it into one usable space for the legislature to be able to assist and make sure that we are adequately addressing those impending needs. Again, simple transparency measure, and, simply ask for an I vote.
Redner 12
And she will accept the committee amendments and thanks the committee for their work.
Redner 47
Perfect. Well, that's great. There are no amendments proposed on this bill, but we're glad she would have. Such a team player. Alright.
Are there any, witnesses in support of this measure? Alright. Seeing none, any primary witnesses in opposition to this measure? Great. Thank you.
Two minutes each. Thanks.
Redner 9
Brandon Ebeck on behalf of Pacific Gas Electric. We submitted a letter on the what was the legal with love act that was then amended after letter deadline. We are still getting a grasp on the new reporting requirements. As the, guest author, guest presenter mentioned, this information is already publicly reported. This is what our investor relations team provides and reports to c e c or sorry, the SEC.
We do quarterly investor relations calls that anybody's willing to join. We happily will discuss our metrics at with anybody at any time because we have been below investment grade since we merged from bankruptcy six years ago. This has been an issue that we have raised around affordability for a long time because as we are below investment grade, that directly affects our cost of borrowing and affects the bills that customers pay. So this is top of mind. It's something that we do wanna focus on.
Redner 31
However, we don't want to require additional reporting that it may not be read. We think that to get a full picture, we do think that the public utility should probably be included because they have also had credit downgrades in recent years as all Californian utilities and other Western United States utilities deal with wildfire risk. Also, just want to call out that last year, the legislature passed AB eleven sixty seven, requires our investor relations team to be shareholder funded. This bill would require that same team to send in a report to the legislature. We would ask for an exemption from that to make sure that that's not a takings violation.
Redner 28
Ken Kauss, on behalf of San Diego Gas Electric and SoCal Gas, we do remain opposed as well. But we do agree with the author and the notion of the legislature engaging and, paying attention to this. The financial health of utilities is very important. Anytime there are downgrades or anything else, there are ramifications and costs incurred by customers because those costs are passed on. Credit ratings similar to your FICO score individually, are determined by a variety of factors, but one that is frequently noted by the rating agencies is regulatory and legislative uncertainty.
I recall back during the first energy crisis in 2000, that was talked about every ratings report that came out. So we we appreciate the legislature wanting to follow that more closely. Having a stable environment to operate and an ability to mitigate risk with affordable access to capital is essential, and when that is not provided, our borrowing costs do go up. We regularly take positions on bills that create that uncertainty or increase risk, and we'll continue to do so and as well as encouraging policymakers to meet with the rating agencies. We've been doing that all session.
Redner 48
They've made a couple of rounds through capital last year, didn't get, frankly, a whole lot of success getting meetings, so we would appreciate that. One thing that I would note, last year, the legislature passed a b two s b two fifty four and the wildfire issue. And one of the the, I guess, the real key point in that report for us was a quote failure to act or conscious decision not to act on risk reduction and on opportunities to enhance the functionality of our insurance markets and electric utilities will have large near term and severe long term consequences for Californians. We appreciate the suggested amendments or at least the discussion of them in the committee analysis, but I would close with one point. The the language says that we are to provide a plain language executive summary not to exceed two pages.
Redner 28
The description of what we're to provide is over a page long. So much like the s p two fifty four report, it'll be very challenging.
Redner 16
Hi. Catherine Borg on behalf of Southern California Edison. We feel like the bill's gone from the Leading with Love Act to the Scarlet Letter Act. Thank you.
Redner 23
Good afternoon. John Kenner from the California Chamber of Commerce. We had an impose on the prior version of the bill. Still trying to understand the new version. Thank you.
Redner 47
We have a motion Second. And a second. Any discussion? Alright. Very, engaged group here to on this bill.
So both your position is, still reviewing and yours is you're opposed?
Redner 47
language just to see how it comes out. Okay. Alright. Well, with that, I suppose you can make a closing statement.
Redner 12
Yeah. I think if if I'm channeling my inner RPK, what I would say is that the opposition is actually somewhat illuminating, that this is an opportunity for a pathway to be created where in which the legislature can work with the IOUs ahead of time to protect ratepayers in the event of a credit downgrade. Downgrade. It's not supposed to be a scarlet letter. It's not supposed to increase the amount of work that needs to happen.
In fact, the the opposition saying that, you know, you can just go get it as opposed to pulling that information that's already publicly available in multiple spaces into one easily digestible, report, not just for the legislature, but for the public too. I I think it's a little bit ridiculous. And and and that that may may be more editorializing than RVK would have wanted, but I will urge you to support the bill. It is more information that allows us to have more tools to protect rate payers at a time when the IOUs are struggling and only when they're struggling. With that, I urge my vote.
Redner 29
Burner aye. Calderon? Chen? Aye. Calderon, aye.
Chen? No. Chen, no. Davies? No.
Davies, no. Gonzalez? Herbidian? Aye. Herbidian, aye.
Hart? Aye. Hart, aye. Erwin? Aye.
Erwin, aye. Cholera? Happen? Rogers?
Redner 29
Rogers, aye. Cholera? Aye. Schiavo, aye. Schulz?
Aye. Schulz, aye. Ta? Wallace? Not voting.
Wallace not voting. Zipper? Aye. Zipper, aye.
Redner 47
K. It's nine to three. That bill is out. We will leave it open for absent members.
Redner 1
Thank you, mister chair and members. I'm pleased to present a b twenty six forty seven, a companion measure to s b 100. Signed in 2018, SB 100 mandates a 100 clean electricity by 2045 and defines qualifying sources as those with zero net greenhouse gas emissions. AB twenty six forty seven directs the California Energy Commission by 07/01/2027 to prepare a comprehensive assessment of the potential role for advanced nuclear technologies in meeting California's long term electricity needs. Californians pay the highest electricity rates in the Continental United States.
Since 2010, the average household's bill has risen 88%, double the national average, and now stands at $1,876 a year. Statewide, that's 13,000,000,000 more than Californians would pay at the national average rate. According to the CPUC, nearly one in five California households is behind on their electricity bill. Families are being forced to choose between food, medicine, and keeping the lights on. This isn't fair for everyday Californians trying to pay their bills and feed their families.
Our businesses pay nearly triple what their counterparts pay in states like Texas, more than a 170% above the national average. Advanced manufacturers, hydrogen producers, and defense contractors are weighing California against competitor states, and we are losing. California's own energy agencies confirmed in their 2021 joint agency report that nuclear meets s p one hundred's definition of clean energy. Yet because of the 1976 moratorium, they refrained from including it in their modeling scenarios, depriving the state of a clear understanding of its role in achieving SB 100. AB twenty six forty seven marks an important and historic step.
Redner 38
In addition to mandating the c e CEC study, it authorizes the Energy Commission, the Public Utilities Commission, the Independent System Operator, and other public agencies to evaluate advanced nuclear energy's potential to meet statewide needs for new electricity resources. The CEC study will examine safety, waste management, system costs, reliability, siding, public health, job creation, and the environment in direct comparison with other energy sources and current pathways. Momentum for advanced nuclear is building in red and blue states alike. The six New England states are exploring a coordinated path to new nuclear. In January, Illinois governor J.
Redner 1
V. Pritzker lifted his state's moratorium two years after opposing the same move, a sign of how fast the ground is shifting, and New Jersey has followed suit. Advanced nuclear also creates thousands of well paid permanent jobs in construction, engineering, and operations. These are careers that sustain families and stay in communities for decades. To conclude, fifty years ago, California made a choice based on the technologies and needs of that era.
Today, we face an entirely different reality. Our grid needs firm, clean power. Our families and businesses need affordable electricity. Our climate goals need every tool available. A v twenty six forty seven gives us the information to make a new choice based on the technologies and needs of our century.
I have two witnesses to testify in support with me today, Scott Wetch from the California State Association of Electrical Workers and Guido Nunez Mujica, data scientists for the Anthropocene Institute.
Redner 35
Madam chair, members of Scott Wich, on behalf of the the State Association of Elective Workers and the California State Pipe Trades Council, both, our those unions on the national basis have made, nuclear deployment a a top priority. Today across The US and around the world, nuclear is back on the table, not as an ideology, but as critical infrastructure. Agencies across The United States and across the world are recognizing that nuclear power is an essential tool for deep decarbonization, not in spite of environmental goals, but because of them. Policymakers are realizing that decarbonization, reliability, and affordability require a broader toolkit. As this as a member mentioned here at home across United States, blue states and red states have opened the door to evaluating and looking and keeping the door open for advanced technologies in nuclear power.
Redner 27
In Europe as well, countries have such as Denmark and Spain, Italy, and and countries in Asia have have shifted their policies to looking at and even deploying, greater nuclear power as a foundation for a rapidly electrifying economy alongside, of course, with renewables. A b twenty six forty seven as amended is a modest but important step towards reengaging with that global reality. It doesn't mandate building nuclear plants. It doesn't commit ratepayers to new investments. What it does is restore something essential to good policymaking, the ability to study, evaluate, and compare.
We shouldn't be afraid to look at what the potential is. We don't know what the next ten or twenty years is gonna look like, and we need to keep all the options on the table. So we'd urge and I both. Thank you.
Redner 39
Good afternoon, madam chair. Thank you very much. My name is Guido Nunez Mujica. I am the director of data science at the Anthropocene Institute. California has ambitious decarbonization goals that s v 100 makes mandatory.
At the same time, Californians are dealing with some of the most expensive electricity in the country and relying on our states to provide a third of our electricity. While we need more clean electricity, our neighbors need it as well. And the increase in demand, not only from AI, but from electrifying our transportation, heating, and cooking, and even to desalinate water, which might be possible, makes this urgent. Yes. Solar and wind power are wonderful, but battery storage alone truly cannot scale enough to meet the duration of our great needs.
Nuclear power, a low carbon electricity source, can meet those needs twenty four seven. Around the world, countries like Taiwan, Italy, Belgium, Japan, and Sweden have reconsidered their attitudes toward nuclear as have other states in our country like Illinois, Connecticut, Colorado, New Jersey, and New York. Nuclear power can benefit our rate payers and be executed on time at a at a reasonable budget. It has been done before. It's not a fantasy.
Redner 2
It's not a pipe dream, but that requires political will. As a data scientist and a researcher, I have seen what happens when nuclear power plants are connected to the grid, how carbon emissions decline fast, how electricity prices stabilize and offer predictability and peace of mind to both citizens and the industry, how it can replace fossil fuels when solar and wind are not available. Nuclear is not only not an enemy, but it's a key ally to renewables in our efforts against climate change, and it can create stable, well paid, unionized jobs that can last generations. A nuclear power plant can last eighty years. AB twenty six forty seven does not change California goals.
Redner 39
It will make them easier to reach out and benefit our people that have been heard for well from well meaning policies that has had unintended consequences. We respectfully ask for your support in passing a b twenty six four seven. Thank you.
Redner 15
Clifton Wilson on behalf of the San Luis Obispo County Board of Supervisors in support, and thank you for the measure.
Redner 18
Madam Chair members, Mike Monaghan on behalf of State Building Trades in support.
Redner 11
Kate Eager with Weidmann Group on behalf of NextGen in strong support. Thank you very much.
Redner 40
Audra Hartman on behalf of the California Large Energy Consumers Association, also known as CLICA, in support.
Redner 21
Marjorie Lee, Samson Advisors here on behalf of the Southern California Public Power Authority in support.
Redner 46
Good afternoon, chair Petrie Norris, committee members and staff. My name is Kim Delfino. I'm here on the behalf of Mothers for Peace and Committee to Bridge the Gap. These two groups, are, one two of the many organizations that oppose previous version of the bill, a bill that would have overturned California's long standing moratorium on the construction of new nuclear reactors without solving the problem that led to the ban in the first place, which is the problem that nuclear waste remains extremely hazardous for hundreds of thousands of years. We appreciate the amendments that were taken that have changed this bill from a a ban removal of the ban to the study.
Unfortunately, we have to remain opposed to the bill. We don't need an expensive state study to know that nuclear waste problems remain unsolved, that nuclear safety regulations have been gutted by the Trump administration, and that nuclear energy remains among the most expensive energy sources on the planet. Case in point is how much ratepayers and taxpayers are paying to continue to operate Diablo Canyon. Two years ago, the assembly declined to advance a b twenty ninety two, which would have directed the state to conduct a study of small modular reactors for a cost of $4,700,000, and the bill before you today is far more comprehensive and is gonna cost even more than that. Our state faces a multibillion dollar structural deficit.
Redner 17
I was just in a hearing today about how the administration's proposing to cut staffing in environmental agencies who conduct permitting for renewable energy projects, and I wanna thank the chair for her questions in that hearing. We really appreciated that. We believe that the study would be an inappropriate, use of resources, and for this reason, we respectfully ask for a no vote.
Redner 11
Thank you. Alright. Additional witnesses in opposition. You can approach the microphone at this time.
Redner 12
Good afternoon, madam chair members. Jacob Evans with Sierra California in a respectful opposition and a nursing opposition for a few other folks, including Physicians for Social Responsibility, LA and SF Bay, the Samuel Lawrence Foundation, the West Berkeley Alliance for Clean Air and Safe Jobs, Parents Against the San Jose Field Lab, Ecological Options Network, the Sunflower Alliance, the Long Beach Alliance for Clean Energy, the Green Party of Santa Clara County, Clean Earth for Kids in Invisible, California. Thank you.
Redner 11
Thank you. Okay. Bringing it back to committee. Questions, comments, mister Arbatian?
Redner 10
Thank you, madam chair. I just wanna thank the author for bringing this bill. I think it's an important bill. I think it's something that, should be incumbent on us to do, frankly. And I think that for a long time, we've delayed learning more about this option.
And I think as a result, we are behind. Even with this bill, it's going to take years to actually potentially implement nuclear. I don't think there's any other way to get to a 100% renewable without nuclear. I've said that for a long time. I think this needs to be on the table.
Redner 21
And I think that we obviously need to figure out the environmental impacts, and that's what this bill will do. It's gonna study the issue. It's gonna provide information. And I'm looking forward to seeing it get through this body, get over to the senate, and hopefully get to the governor's desk. So thank you for your leadership, and I look forward to voting for it today.
Redner 18
For that, I wanna thank you for, bringing this bill. As as you know, I have a lot of mixed feelings about nuclear, and I am, you know, prepared to move this forward today because it is a study bill. I do think that we should actually be learning about the about the advanced technologies that are here today. I did wanna confirm that actually part of the study is actually gonna be safety and studying of where the spent fuel would be going. And so, I think you had told me that that was part of, what the study would include and just wanted to confirm that that was the case.
Redner 18
Well, thank you. You know, just a couple comments. I mean, make no mistake that I don't believe the opposition's position would be any different if Trump wasn't president. But, you know, I gotta get that into the talking points, I guess. But, you know, with these new technologies, the entire spent nuclear fuel rods for the entire lifetime of a nuclear power plant can fit in half the size of this room, but we don't even take the opportunity to study it.
Redner 47
The only concern I have with your bill is it's not the original bill. But, you know, that's part of the legislative process, and I think it's fair more than fair to after five decades before I was born to study the new technologies that have happened in all that time. So I appreciate you bringing this forward, and I know for a lot of my colleagues, it's, you know, it's a it's a tough thing to consider, but we should. It's the cleanest. It's so clean.
You know? And we haven't figured out how to how we're gonna get rid of other types of fuel that we might be burning into the air and things like that. And there's seems to be, you know, that's what we're doing as an alternative right now because we're not doing nuclear energy. So I look forward to studying this, and I'm glad you're gonna consider the environmental concerns as well because those are important. So thank you.
Redner 14
Thank you, madam chair. And just, I've put some comments in the record similar to the the last committee, folks asked asked me what like, how I knew so much about nuclear. My father's retired as a nuclear scientist and used to design safety systems for power plants for for many, many years. And and I think this study is important. And and I think I I don't wanna downplay fears folks have.
Redner 25
I mean, this a lot of people have gone through a lot of pain because of catastrophes and disasters that have happened over the years in different parts of the world, including relatively recently in Japan, and that was a General Electric reactor. It was a reactor from the the sixties, seventies design model. And I think that's why we need to study where we are now with the technology, where we are now in terms of safety, improved safety from those from those plants from many decades ago and the designs, where we are in terms of spent fuel and to be able to recycle them recycle the fuel. I think now compared to back in the older plants, you can recycle 90 to 95% of what you used to be able to recycle. Still doesn't make mean that that there's not a legitimate issue regarding the spent fuel, but it it is a different task now than it may have been decades ago.
Redner 14
And and to some of mister Burr's points, I raised the other committee as well, is that I really do want the study to come back and be comprehensive in terms of safety, both in terms of dealing with the spent fuel, both in terms of human error, because that's what happened at Fukushima. That's what happened at 3 Mile Island. It was human error. It wasn't tech it wasn't the technology. And so how do we limit that human error and then, and finally, any kind of terrorist or the kind of intentional attack?
How, it's obviously very different, you know, attacking coal or natural gas versus nuclear. How is that accounted for in modern, nuclear power plants? But I I also think this is a good time for us to do the study, and appreciate you for bringing it forward.
Redner 11
Alright. I'll I'll just also, thank the author for bringing this forward. I think that we all know, I think we all know, that building California's clean energy future relies on an above all of the above approach. And so I think this is the right time for us to ask if nuclear should be part of our energy portfolio moving forward, as we look to achieve our shared goals. So with that, would you like to close?
And I'll also say, yes, the journey of a thousand miles begins with a single step. So we're gonna study it for a little bit before we go any further. Go ahead.
Redner 1
Thank you, madam chair. Yes. I'm, you know, I'm very pleased with the the prospects of the study and what can come from this. I think it's important that fifty years later, we learn what is possible because for we need to do this for future generations and for our kids and our grandkids and see what's possible. So I think, you know, I I am excited to see what comes from this, and I respectfully ask for a night vote.
Thank you.
Redner 11
Do we have a motion? Yes. Okay. We've got a motion and a second. So, madam secretary, please call the roll.
Redner 29
Item number 19, a b twenty six forty seven. The motion is due passed to appropriations. Petrie Norris. Aye. Petrie Norris.
Aye. Patterson.
Redner 29
Harbetian. Hart. Hart not voting. Erwin? Aye.
Erwin, aye. Calra? Aye. Calra, aye. Pappin?
Aye. Pappin, aye. Rogers, Rogers, Schiavo? Aye. Schiavo, aye.
Schulz?
Redner 11
Fifteen zero. That bill is out, and we'll leave the roll open for absent members to add on. Okay. We are almost at the finish line, friends. So we are gonna move to file item 21, which is ACA nine by Assembly member Berner.
And then we got one more left. I've got very exciting news. This is our final bell. Final bell.
Redner 50
Did ask me to speak louder for the first nine first time in fifty three years. So good afternoon, madam chair and members. First, I wanna thank the chair and committee for working with me on this bill. ACA nine is about structural changes to the CPUC for the benefit of consumers. It's about giving the people of California a voice.
It's about affordability. Californians have some of the highest utility prices in the nation paying close to double what other residential users do in The United States. Despite already high rates, California rates have continued to grow exponentially. The CPUC makes determinations that affect utility bills, wildfire safety, reliability, and sustainability. Despite their large roles in the lives of our constituents, the commission is stretched thin with five unelected commissioners appointed only by the governor.
Redner 34
They make policy decisions over a range of industries that impact us all. ACA nine would expand the CPUC to nine commissioners from five, giving the speaker of the assembly and two appointments and the pro tem of the senate two appointments and to require the commission to focus on affordability and rate making. These changes would ensure that our public utilities commission represents what people want and give the people's represent representatives more oversight and control of decisions that are made. ACA Night also includes provisions that would ensure that necessary broadband funding, which funds that are important to programs that provide critical critically needed infrastructure to close the digital divide, are handled efficiently with an office that can focus solely on this important function. A b twenty two eighty nine, which passed out of this committee on a bipartisan vote, contains other portions of that change.
Redner 50
ACA nine is part of a comprehensive strategy to implement the structural reforms needed to better focus and expand our state's ability to address the pressing issues our constituents care about the most, energy affordability and reliability. I respectfully ask for an I vote, and as you see, there are no witnesses for the final bill of this committee because it's a Tasha B special.
Redner 11
Okay. I'm sorry. Is there any me too testimony in support for this Tasha b special? Please approach the microphone at this time.
Redner 2
Good afternoon, chair members. Sam Nasher on behalf of the Los Angeles County Office of Education in support. Thank you.
Redner 11
Thank you. Okay. Moving to any witnesses in opposition. Seeing none, bringing it back to committee. Questions or comments?
Vice chair Patterson.
Redner 47
I just never thought I'd be you know, Natasha B. Specials, you know? Here we are, and, looking forward to supporting this one today, so thank you.
Redner 11
Alright. With that, assembly member, would you like to close? Miss Duffley asked for your I vote. Okay. You got a motion and a second.
Madam Secretary, please call the roll.
Redner 29
Item number 21 ACA nine be adopted to appropriations. Petrie Norris? Aye. Petrie Norris, aye. Patterson?
Redner 29
Burner, aye. Calderon? Aye. Calderon, aye. Chen?
Aye. Chen, aye. Aye. Davies, aye. Gonzalez?
Aye. Gonzalez? Aye. Herbidian, Hart? Aye.
Hart, I. Erwin? Aye. Erwin, I. Colra?
Aye. Colra, I. Pappin? Aye. Pappin, I.
Rogers, I. Chiavo? Aye. Schulz? Aye.
Schultz, I. I. Wallace? Aye. Wallace I Zebur.
Redner 11
That is seventeen zero. Seventeen zero. That bill is out, and we will leave the roll open for absent members to add on.
Redner 11
Okay. We are gonna go ahead and dispense with the consent calendar. Thank you. Thank you. Madam Secretary,
Redner 29
please call the roll. Item number three, AB nineteen forty five, the motion is due passed to the floor. Item number five, AB 2,031, the motion is due passed to appropriations. Item number six, AB 2,065, due passed to appropriations. Item number eight, a b two one sixty three, due pass as amended to appropriations.
Redner 26
Item number nine, a b two one seventy five, due pass to appropriations. Item number 10, a b two one eighty one, due pass to appropriations. Item number 14, AB two thousand four and seventy six, due pass as amended to appropriations. Item number 17, AB 2,608, due pass to appropriations. Petrie Norris?
Redner 29
Burner, aye. Calderon? Aye. Calderon, aye. Chen?
Aye. Chen, aye. Davies? Davies?
Redner 29
Hart, I. Erwin? I. Erwin, I. Colre?
I. Colre, I. Pappin? I. Pappin?
Rogers I. Schiavo I. Schultz?
Redner 11
Okay. '17, the consent calendar is out. We'll leave that open for absent members to add on. At this time, we are going to go ahead and do a lap through, all of our bills so that members can add on to votes. We'll start.
Oh, okay. File item number one. We actually need thank you. Second. And a second?
Alright. So file item number one, a b eighteen thirteen by Assembly Member Ward. Madam Secretary, please call the roll.
Redner 29
Mhmm. The motion is due pass as amended to appropriations. Petrie Norris? Aye. Petrie Norris?
Aye. Paterson?
Redner 29
Calderon not voting. Chen? Chen, not voting. Davies? Not voting.
Davies, not voting. Gonzalez? Aye. Gonzalez, I. Herbidian?
Aye. Herbidian, I. Hart? Aye. Hart, I.
Erwin? Aye. Erwin, I. Calra?
Redner 11
Eleven zero. Eleven zero. That bill is out, but we'll leave the roll open for absent members to add on. Moving to file item number two, a b eighteen forty nine.
Redner 29
It's yeah. Patters mhmm. This, again, is item number 2AB1849. Patterson? Aye.
Patterson, aye. Burner? Aye. Burner, aye. Chen?
Aye. Chen, aye. Davies? Aye. Davies, aye.
Gonzalez?
Redner 11
That's 16 Sixteen zero. That bill's out. We are going to leave the roll open for absent members to add on. Moving to file item number four, a b nineteen seventy five. Patterson?
Redner 29
Patterson, aye. Burner? Aye. Burner, aye. Calderon?
Aye. Calderon, aye. Chen? Chen, I. Davies?
Aye. Davies, I. Gonzalez? Aye. Gonzalez, I.
Herabidian?
Redner 11
zero? Sixteen zero, that bill is out. Next up is a b 20 80 eight, file item number seven, a B2088 by assembly member Pappen. Patterson?
Redner 29
Gonzalez, I. Her sorry. Heart? I. Heart, I.
Cholera? Aye. Cholera, aye. Schultz? Aye.
Schultz, aye. Ta?
Redner 11
zero, that fills out. Next up, file item number 11, a b twenty three thirteen by assembly member Berman. On that one, we do need a motion. So moved. K.
We got motions and seconds. Madam secretary, please call the roll.
Redner 29
A b twenty three thirteen do pass as amended to appropriations. Petrie Norris? Aye. Petrie Norris, aye. Patterson?
No. Patterson, no. Burner? Aye. Burner, aye.
Calderon? Chen? Chen, not voting. Davies?
Redner 29
Colra, aye. Pappin? Aye. Pappin, aye. Rogers?
Aye. Rogers, aye. Chiavo, Schulz?
Redner 11
104. Okay. 10 4. That bill is out. We are going to leave the roll open for absent members to add on.
Next up is file item 13, a b 2369. I'm sorry. I skipped number 12. Alright. File item 12, a b 2338 by assembly member Ransom.
Redner 11
Alright. Eleven three, and that bill is out. Tree tie, you guys have, like, the exact same bill as the bill you carried for two years?
Redner 11
Yeah. That I helped you in. Just just noted for future. Okay. Sorry.
Getting us back on track while while feeling a little loopy. Alright. File item 13, AB twenty three sixty nine, assembly member Rogers.
Redner 29
Gonzalez, aye. Calra? Papp Aye. Mhmm. Calra, aye.
Pappen? Aye. Pappen, aye. Schultz? Aye.
Schultz, aye. Ta?
Redner 11
Sixteen zero, that fills out. Moving to file item 15, a b twenty five eighteen by Assembly Member Sharp Collins.
Redner 29
Aye. Boehner, aye. Gonzales? Aye. Gonzales, aye.
Herbidian? Aye. Herbidian, aye. Kullra? Aye.
Kullra, aye. Happen? Aye. Happen, aye. Ta.
Redner 11
Zero, that bill is up. Next up, file item 16, a B2543, assembly member ransom.
Redner 29
Gonzalez, I. Herabidian? I. Herabidian, I. Calra?
I. Calra, I. Pappin? I. Pappin, I.
Ta?
Redner 29
Berner, aye. Chen? Chen, aye. Davies? Davies, a b twenty six twelve.
Davies not voting. Gonzalez?
Redner 29
Gonzalez, I. Herabidian? I. Herabidian, I. Cholera?
I. Cholera, I. Ta. I. Ta, Zaber?
I. Zaber, I. 14, 15, 1717.
Redner 11
Okay. 160, and that bill is out. Next, we've got file item 20, a B2710 by assembly member Bauer Cahan.
Redner 29
Patre Norris? Aye. Patre Norris, aye. Gonzales? Aye.
Gonzales, aye. Calra? Aye. Calra, aye. Pappin?
Aye. Pappin, aye. Ta?
Redner 11
Last up is file item 21 ACA nine. Oh, I'm sorry. For file item 20 a b twenty seven ten.
Redner 11
133 and that's out. So moving on to file item 21 ACA nine by assembly member Berner.
Redner 11
180, that is out. And then Okay. I think almost everybody is is done. We just have a couple catch ups for Yeah.
Redner 29
Oh, twenty three thirteen. I don't have Erwin on that. Oh, she's not coming back.
Redner 11
Alright. So you're you're cut up. You're cut up. Yeah. Okay.
So we will entertain vote changes at this time.
Redner 7
same time. Apologize. Vote change on a b nineteen seventy five shelves. No to yes.
Redner 11
Okay. So that bill is now 180, and that bill's out. Alright. Thank you. Alright.
We are going to hold the roll open for oh, never mind. We're not. Our business here is concluded. And, so that concludes today's hearing of the Assembly Committee on Utilities and Energy, and we are adjourned.
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