Funding strategies for climate projects, next steps in energy efficiency and distributed resources, and more!

November 2015
Hello ,

Thanks to everyone who attended our quarterly meeting in October! We're working on the next quarterly meeting, targeted for January. Since our last newsletter, the LGSEC has:
  • Advocated at the Air Resources Board regarding cap and trade funds for local governments;
  • Participated in meetings and workshops at the California Public Utilities Commission and California Energy Commission on topics including energy efficiency, distributed generation planning, energy usage data;
  • Submitted comments on those same topics listed above;
  • Tracked debate over the future of net energy metering; and
  • Continued work on our strategic plan and the next steps in the LGSEC's evolution as a voice for local governments on energy and sustainability.
LGSEC Quarterly Meeting Update
On October 6, the LGSEC held its quarterly meeting in San Rafael. Our host, Marin Clean Energy, provided an overview of their programs and accomplishments to date and ended with an inspiring message about the growth of community choice aggregation across the state.
 
An update on LGSEC's strategic planning process followed, with a lively discussion about organizational vision and priorities for the future. In particular, discussion focused on the "how" of the priorities, stressing the need for actionable strategies.
 
The meeting included a variety of speakers and topics. Rob Nicely of Carmel Building and Design touched on the water energy nexus and explored water and energy conservation through the Nexus eWater System. He also discussed how he was able to gain approval from Monterey County to install this new technology in home retrofits. In the afternoon, we heard about demand response in local government and got an exclusive look into Sonoma Clean Power's upcoming demand response pilot.
 
The legislative and regulatory report portion of the meeting included an introduction to the Integrated Climate Funding Market proposal. By aggregating state and local resources, the Integrated Climate Funding Market can expedite the process for receiving funding for climate action projects. Kate Meis from the Local Government Commission and Denise Tyrrell with the CPUC provided an overview of the proposal and discussed plans for implementation. The regulatory report went on to review current legislation and regulations including energy efficiency in existing buildings, net energy metering, and the distribution resources plan.
 
Presentations and resources from the meetings can be found in the Members Only section of www.lgsec.org . Stay tuned for the date and location for our next quarterly meeting. 

California Public Utilities Commission 
CPUC Approves Energy Efficiency Rolling Portfolio, Revises Schedule
On October 22, the CPUC adopted energy savings goals for energy efficiency programs in 2016, and beyond, approved the Rolling Portfolio process, and updated various metrics used in the energy efficiency portfolio ( Decision 15-10-028). In terms of the Rolling Portfolio, the Decision adopts in large part the proposal from the Joint Parties, in which the LGSEC participated. This includes the 10-year cycle, filing of business plans in place of program implementation plans, and affirming the ongoing role of a stakeholder Coordinating Committee. Initial business plans will be due no later than September 1, 2016. After that, Program Administrators must submit business plans when a "trigger" event occurs, and may submit them whenever they choose. Program Administrators must engage in a stakeholder process as they develop their business plans.
 
 
On October 30, the CPUC issued a new Scoping Memo in this proceeding, in recognition of changes brought about by the passage of SB 350 and AB 802 earlier this year. The Ruling anticipates that over the next year, the CPUC will take on the following issues:  
  1. High opportunity programs or projects, pursuant to AB 802, which directs that the focus of these programs is to be on increasing the efficiency of existing buildings. The CPUC has issued an initial proposal, on which parties are submitting comments this month.
  2. Remaining "Rolling Portfolio Cycle" implementation issues. This includes further guidance for the business plans and implementation plans that will be due September 1, 2016, a review of RENs, and the possible changes to statewide and third-party programs and accounting practices described above.
  3. Interpretation and implementation of AB 802 generally and support for implementation of SB 350. This will be Phase IIIA, and will include how baseline is determined for purposes of measuring savings and possible changes to the process by which energy efficiency measures are assigned savings values.
 
The CPUC will be holding a series of workshops to implement this new Scoping Memo, as well as taking comments. The Scoping Memo includes a master schedule.
CPUC Continues to Look at Energy Efficiency EM&V
It seems like every week there is at least one meeting or webinar on another aspect of the CPUC's ongoing evaluation, measurement, and verification of energy efficiency programs. All the documents related to this process   can be found at
www.energydataweb.com . The next meeting will be on November 24, 2015, 2:30 - 4:00 p.m., at which the topic will be the residential sector chapter updates for version 6 of the 2013-2015 EM&V Evaluation Plan. To join the meeting, click here: https://my.intercall.com/dm0bvb2
CPUC Hosts Distribution Resources Plans Workshops
On November 9, 10, and 16, the CPUC hosted a series of workshops on the investor-owned utility distribution resources plans (R.14-08-013). The first workshop discussed a proposed roadmap from the CPUC for this proceeding and the companion rulemaking on Integrated Distributed Energy Resources (R.14-10-003). The second workshop looked at the methodology being used to model where best to site distributed energy resources; the technical name for this is the "integrated capacity analysis." The final workshop featured a number of academics discussing different topics. You can find the agendas and documents for these meetings here .
 
The staff proposal on how to move ahead procedurally in the DRP proceeding envisions a number of workshops in the early part of 2016, with a focus jointly on demonstration projects the utilities have proposed, the methodology being used to determine where best to site distributed energy resources, access to data, and related issues. The LGSEC submitted comments on this draft roadmap on November 20. The LGSEC joins a number of other parties in observing that the orientation of the discussion is weighted heavily toward a utility-driven grid, focusing on utility investments. A range of parties are suggesting that the CPUC should be developing a system where opportunities for distributed energy resources are clear, and then customers build out those resources.
 
If you want to study up on distributed energy, the Lawrence Berkeley National Laboratories hosted two webinars in November on what the energy grid will look like and how it will operate with more distributed energy resources online. The first webinar looked at a report on the structure of the electricity industry and regulatory responses. This report describes two competing views of the future. In one, utilities play a major role in sourcing, financing and optimizing distributed energy resources. In the other, competitive firms increasingly perform these functions. In such a future, the utility focuses on providing and maintaining infrastructure to deliver basic energy and capacity services, while facilitating distributed energy resources to create value for the utility and grid, lower the utility's costs, and encourage customers to remain connected to the distribution system rather than defect from it.
 
The second webinar examined a proposed three-stage framework to guide the evolution of distribution systems with growth in distributed energy resources. The report being discussed provides a structured sequence that regulators and policy makers can use to assess options and develop a preferred distribution system tailored to their jurisdiction, with clear lines of sight to overarching regulatory and public policy objectives. The authors then compare three distribution operational models for the future and discuss the pros and cons of an independent Distribution System Operator ("DSO") versus the distribution utility serving as the DSO. The report concludes with considerations and recommendations for policy makers, regulators, utilities and other stakeholders. You can review the reports here .
CPUC Considers Next Net Energy Metering Tariff and Low-Income Multifamily Solar 
The CPUC held hearings in early October on the composition of the new Net Energy Metering tariff ordered by AB 327. The debate and lobbying around this new tariff has been fierce, with rooftop solar advocates pushing hard for the CPUC to maintain as much as possible the current tariff. The utilities have been pushing for a new rate structure that would increase connection and standby generation fees for customers who install rooftop solar. The utilities argue that those customers least able to afford solar power are subsidizing those who can afford it. The solar industry, joined by some environmental groups and others, argue that the current tariff has led to great deployment of solar, but is still barely tapping the potential of this resource to help meet State goals.
 
The CPUC also recently took comments on how it should implement Assembly Bill 693 (Eggman, 2015), a recent piece of legislation that allocates funds from the investor-owned utilities' cap and trade revenues to create a Multifamily Affordable Housing Solar Roofs Program. A key issues that's come up in that discussion is the definition of "disadvantaged community." AB 693 allows either the CalEPA definition of disadvantaged community, or the Department of Water Resources definition. In comments filed earlier this month, many parties are suggesting that many affordable multifamily buildings will not be able to take advantage of this new program if the CPUC relies only on CalEnviroScreen to determine eligibility. Other definitions that parties recommend the CPUC consider include households eligible to receive assistance under the California Alternative Energy Rates program, or the Health Disadvantage Index created by the Public Health Alliance of Southern California. Parties recommend the CPUC consider as well all IRS Qualified Census Tracts, federally-designated Empowerment Zones, Enterprise Communities, and Targeted Employment Areas.
MCE Submits 2016 Energy Efficiency Application
Earlier this month, Marin Clean Energy submitted to the CPUC an application for MCE's 2016 energy efficiency programs ( A.15-11-014 ). The MCE application includes a business plan for MCE's energy efficiency program, and requests several things of the CPUC:
  • Authorization to offer a larger suite of programs in order to meet the cost-effectiveness test. MCE's current portfolio has been limited to serving gaps in utility-sponsored program and hard-to-reach markets.
  • Recognition of community choice aggregators as the default energy efficiency Program Administrator in the areas served by the CCAs, and the fiscal administrator for statewide programs the CCA chooses to offer itself. MCE suggests that CCAs should have the right of first refusal to select the energy efficiency programs they administer in their service territory.
  • Because the business plan covers 10 years, as the new Rolling Portfolio framework allows, MCE recommends a methodology to expand the CCA's budget if the CCA expands its service territory.
  • Approval of a mechanism that ties energy efficiency incentive levels to adoption rates, so incentives go down as measures are more widely adopted.
MCE justifies submitting its application in advance of explicit direction from the CPUC to Program Administrators because if the CPUC designates community choice aggregators as default program administrators, it will allow the utilities to then avoid overlap as they develop their applications for next September. The application does not mention how the MCE request would affect Regional Energy Networks.
 
Comments and protests on the MCE application are due December 14.
Energy Data Access Committee Meeting - Please Attend December 2
In the beginning of this year, the CPUC established an Energy Data Access Committee ("EDAC"), a stakeholder group that provides the CPUC with advice about utility protocols for reviewing data requests for customer energy usage data, reviews disputes between a utility and a data requestor, and is a forum for discussing changes in data access as technology and stakeholder data needs change.
 
EDAC members include each investor-owned utility, two CPUC staff members from the Energy Division and the Office of Ratepayer Advocates, two representatives from the CEC, representatives from TURN, the Electronic Frontier Foundation, the Natural Resources Defense Council, the Center for Sustainable Energy, the California Center for Sustainable Communities at UCLA, UC Berkeley, and one local government/LGSEC rep. Barry Hooper from the City and County of San Francisco is representing the local governments and is happy to answer any questions.
 
The EDAC is a key channel to advocate for consistent and convenient data access, and to help the CPUC better recognize there is a balance between two legitimate public policy interests: data-informed energy and climate action, and privacy. The next meeting of the EDAC is December 2. The agenda includes adding a second local government seat for better representation, AB802 and tenant consent for release of benchmarking data, the LA Energy Atlas, and new seemingly unintended limitations on data access due to SB178. To join the meeting: 
  1. Go to: https://sempramtg.sempra.com
  2. Enter your meeting ID 5767 and click ATTEND Meeting
  3. Sign in as a Guest
Please join the call Dec 2 if you want to see greater representation of local government energy efficiency and climate programs in data access. 

California Energy Commission 
Energy Disclosure Rules Disbanded in 2016 as CEC Implements New Legislation
The California Energy Commission on October 19 announced that it will suspend in 2016 the building energy use disclosure rules that were put into effect under AB 1103. The recently enacted
Assembly Bill 802 (Williams, 2015) calls for a new statewide building energy use benchmarking and public disclosure program to replace the AB 1103 rules.
 
AB 1103 will be in effect through the end of this year. Building energy use disclosure at the time of sale, lease, finance, or refinance will continue to be required until then. AB 1103 will be repealed January 1, 2016, meaning the Energy Commission's regulations pertaining to this statute will no longer be in effect and the current rulemaking will be ended. The CEC has opened a new docket that will replace the AB 1103 docket.
 
There will be no statewide energy use disclosure requirement in 2016. During this time, Energy Commission staff will engage in a public process to develop regulations and establish the reporting infrastructure for the new program. Staff anticipates that regulations for the new program will be in effect January 1, 2017.
 
The CEC held a scoping workshop on November 10 on how to implement the benchmarking provisions of AB 802. You can find the agenda and presentations here. Comments on the scope of this proceeding are due December 31. If you'd like to help shape the LGSEC's comments, please contact Jody London.

CEC Releases Draft Energy Policy Report
The CEC, under state law, is required every two years to adopt an Integrated Energy Policy Report (IEPR). In October, the CEC released the draft 2015 report. The latest IEPR picks up the Governor's goals, now embodied in large part in law through SB 350, of moving to a "low-carbon" electricity grid and transportation sector. The Plan is clear that the foundation of California's energy policy is to address climate change. The current IEPR focuses on energy efficiency, particularly increasing the efficiency of existing buildings.
 
While the draft report is being reviewed, the CEC continues to hold hearings on a range of topics, including energy storage, the transmission grid, transportation energy demand forecasts, and research and development projects. The final report is scheduled to be adopted in February.

Air Resources Board
Air Resources Board Moving Closer to Second Cap and Trade Investment Plan
The California Air Resources Board on October 27 released the
  Draft Second Investment Plan for cap and trade revenues. This investment plan covers fiscal years 2016-2017 through 2018-2019. The LGSEC in September joined in a proposal from the Local Government Commission for the State to create an integrated climate funding market. Under this proposal, the State would form a joint powers authority for climate funding, pooling funding from grants available across State agencies so that local governments can submit integrated projects with one application. This proposal also encourages the State to enable community resource markets that would facilitate regional purchasing of goods and services, and structuring of financing mechanisms.
 
The Second Investment Plan appears to adopt this proposal only for "disadvantaged communities." It also continues to use definitions of "disadvantaged" that we have heard from LGSEC members are proving to be challenging for many local governments. For example, there are several rural counties that are located within the Sacramento Metropolitan Statistical Area. By all measures, these counties should be considered disadvantaged, but their geography makes them ineligible for these funds.
 
The LGSEC submitted comments on the draft Second Investment Plan on November 13. We encouraged the ARB to adopt the integrated climate funding market more broadly, and to revisit how "disadvantaged" is defined. You can find the LGSEC comments here. 

New York Exploring Link to California's Cap and Trade Market
In October, New York Governor Andrew Cuomo directed agencies in that state to explore connecting with carbon markets across the continent, including California, Quebec, and Ontario, and the Regional Greenhouse Gas Initiative in New England. Cuomo also signed the Under 2 MOU climate pact being organized by Governor Jerry Brown.
Resources, Events, and Happenings
LA Energy Atlas Promotes Easy Access to Energy Use Data
The California Center for Sustainable Communities at UCLA (LGSEC member) recently launched the LA Energy Atlas , the first-of-its-kind interactive website that maps energy use data across Los Angeles County. The map shows energy consumption at the neighborhood, city, and county scales, breaking down energy use into categories by residential, commercial, industrial, or institutional uses. Users are able to download data that has been previously inaccessible and can analyze trends and patterns across the region over time. The map will be an invaluable resource for policymakers, researchers, and energy stakeholders to identify areas for conservation and to help meet energy targets.
California Ranks Second in Energy Efficiency
The American Council for an Energy Efficient Economy in October released its ninth annual State Energy Efficiency Scorecard. California scored second in the nation, with several California cities also recognized for their aggressive and ambitious policies nad programs. ACEEE refined the methodology this year, getting better and more specific data from states and adjusting scoring criteria to reflect the changing landscape of energy efficiency.
 
This year the scorecard places more emphasis on the transportation sector, and also on actual outcomes. You can review the scorecard here.  
Save the Date: March 4 Symposium on Community Choice Energy
On March 4, 2016, the LGSEC will be a co-sponsor of a symposium on community choice energy, in San Jose. The Symposium will provide a forum to exchange ideas about Community Choice Energy programs, and to learn about current energy policy, regulations, markets, and technology.
 
Confirmed speakers include CPUC Commissioner Carla Peterman, CA Independent System Operator Board Member Angelina Galiteva, and SolarCity CEO Lyndon Rive. Topics will include:
  • Critical elements of successful Community Choice programs
  • Community Choice 101: Procurement, risk assessment, financing, operations
  • Designing programs that drive economic development
  • Opportunities and challenges of developing distributed energy resources
  • Policy and regulatory trends that will impact local energy efforts
  • Top local energy and efficiency programs
  • Forecasts about the utilities and grids of the future
  • Leveraging storage, microgrids, and electric vehicles to enhance local energy projects
  • Community Choice as a system integrator and platform for innovation
For more information, contact Barry Vesser at   [email protected] . RSVP at localenergybiz.com
Giant Ocean Wind Project in Morro Bay?
The Morro Bay City Council in October approved a memorandum of cooperation with Trident Wind for a 1,000 MW wind-energy project in the coastal waters off Morro Bay. The proposed plant would use the cooling-water outfall structure from the closed Morro Bay power plant. The project would use floating wind turbines that would be moored via cables to the ocean floor. Morro Bay's waters are also being looked at by Dynegy, which in 2014 obtained preliminary permits from the Federal Energy Regulatory Commission for two 650 MW wave-energy projects also off the Morro Bay coast.
Ballot Measure Would Create Statewide Electrical District
On October 29, Attorney General Kamala Harris allowed a proposed ballot initiative that would create a statewide publicly owned utility district that would provide electric service to the customers currently served by the three big investor-owned utilities. The initiative now can start gathering signatures to qualify for the November 2016 ballot. The initiative is being brought forward by anti-nuclear activist Ben Davis. If it passes, the statewide district would be divided into 11 wards. Community choice aggregators would receive transmission and distribution service from the new district. The Legislative Analyst's Office could not put a finite estimate on the costs of the measure, given the large number of changes it would entail.
This newsletter is one of the benefits of your membership in the LGSEC.  We appreciate your support!

Sincerely,

Jody London
Regulatory Consultant


Howard Choy
Chair, LGSEC and General Manager, Los Angeles County Office of Sustainability