Microgrids: Clean Community Microgrid Incentive Program.

Under existing law, the Public Utilities Commission (PUC) has regulatory authority over public utilities, including electrical corporations. Existing law authorizes the PUC to establish rules for all public utilities, subject to control by the Legislature, and authorizes the PUC to fix the rates and charges for every public utility and requires that those rates and charges be just and reasonable. Existing law requires the PUC, in consultation with the State Energy Resources Conservation and Development Commission and the Independent System Operator, to take specified actions by December 1, 2020, to facilitate the commercialization of microgrids for distribution customers of large electrical corporations. This bill would require the PUC to develop and implement a Clean Community Microgrid Incentive Program by 2022 to fund community microgrids that support the critical needs of vulnerable communities that utilize distributed energy resources for the generation of electricity. The bill would establish the budget for the program in an unspecified amount to be dispersed in successive phases to local public agencies for community microgrid development and would require that expenses incurred by a large electrical corporation to fund the program be allocated to all distribution customers of the large electrical corporation on a nonbypassable basis. The bill would require that a third-party administrator that is not a public utility administer the program. The bill would provide that a community microgrid project undertaken pursuant to the program is not subject to the Cortese-Knox-Hertzberg Local Government Reorganization Act of 2000. The bill would require the PUC to include a discussion of the costs and benefits of community microgrid projects implemented pursuant to the program in a specified smart grid report annually submitted to the Governor and the Legislature. The bill would require the PUC to modify Electric Tariff Rule 21 to allow a microgrid developer the option of submitting a single interconnection application for the distributed energy resources to be used in a qualifying microgrid. Under existing law, a violation of any order, decision, rule, direction, demand, or requirement of the PUC is a crime. Because certain of the provisions of this bill require PUC implementation, this bill would impose a state-mandated local program by creating new crimes. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason.