AB 1203

This bill creates an office of sustainability and clean energy and establishes clean electricity and emissions standards that must be met by specific dates.

Office of sustainability and clean energy

The bill creates in the Department of Administration an office of sustainability and clean energy. The secretary of administration must direct the office of sustainability and clean energy to establish, using rigorous sector-based modeling, an economy-wide decarbonization roadmap that incorporates, as appropriate, the state’s clean energy plan issued in 2022. The roadmap must be updated periodically.

Emissions standards

The bill provides that, by 2050, the state must achieve 100 percent clean electricity production and emit no more carbon into the atmosphere than can be removed economy-wide.

Carbon-free and renewable energy standards

Current law generally requires electric providers, which include electric utilities and retail electric cooperatives, to ensure that, in a given year, a certain specified percentage of the electricity sold to customers and members is generated from renewable resources. The bill creates a definition of “carbon-free energy” and requires that for the years 2030 to 2034, electric providers and certain state agencies have a minimum carbon-free energy percentage of 50 percent. Later, the bill requires electric providers and certain state agencies to have the following minimum carbon-free energy percentages: 1) for the years 2035 to 2039, 65 percent; 2) for the years 2040 to 2044, 80 percent; 3) for the years 2045 to 2049, 90 percent, and 4) for 2050 and each year thereafter, 100 percent.

The bill requires each electric provider to submit a transition plan to PSC that includes the electric provider’s plan for satisfying the carbon-free energy percentage requirements. The transition plan must identify electric generating facilities that the electric provider proposes to add or retire. PSC may approve a transition plan only if certain criteria are satisfied, including that any continued use of an electric generating facility that is not a carbon-free facility is the most cost-effective decision for customers and that any retirements of such facilities are the most cost-effective decisions for customers.

In addition, the bill creates a definition of “specified renewable energy” and requires that for the years 2030 to 2034, each electric provider have a minimum specified renewable energy percentage of 20 percent. Later, the bill requires electric providers to have a minimum specified renewable energy percentage of 40 percent for the years 2035 to 2039, and to have a minimum specified renewable energy percentage of 60 percent for 2040 and each year thereafter. If an electric provider violates either the minimum carbon-free energy percentage requirement or the minimum specified renewable energy percentage requirement, PSC may order the electric provider to engage in activities that would satisfy the requirement. An electric provider that violates such an order is subject to a forfeiture in an amount not to exceed the estimated cost of the electric provider to satisfy the requirement for which the order was issued.

Also, under current law, a person seeking to construct a large electric generating facility having a nominal capacity of 100 megawatts or more or a high-voltage transmission line must obtain a CPCN from PSC. The bill requires PSC to, in taking action on CPCN applications, prioritize applications for facilities that minimize greenhouse gas emissions. Further, the bill requires PSC to make all of the following determinations to approve an application for a CPCN for a large electric generating facility: 1) that the proposed facility will not impede the applicant’s ability to satisfy the bill’s minimum carbon-free energy percentage requirement or minimum specified renewable energy percentage requirement; 2) that the applicant agreed to pay laborers, ironworkers, technicians, and mechanics the prevailing wage or the rate under an applicable collective bargaining agreement, whichever is greater; 3) that locations where other large electric generating facilities have been retired are used to the extent practicable; 4) that persons who previously worked at other large electric generating facilities that have been retired will be hired to the extent practicable; 5) that persons residing in this state will be hired to the extent practicable; and 6) that persons residing in the municipality where the large electric generating facility will be located will perform at least 15 percent of the labor hours on the project, to the extent practicable. Also, the bill allows PSC to determine that a proposed facility or high-voltage transmission does not satisfy certain requirements for granting a CPCN related to air pollution impact even if the proposed facility or high-voltage transmission line satisfies current state air pollution laws. The bill also prohibits PSC from issuing a certificate of authority (CA) to an electric utility for a project unless PSC determines that issuing the CA will not impede the ability of the electric utility to satisfy the bill’s minimum carbon-free energy percentage requirement or minimum specified renewable energy percentage requirement. Under current law, a public utility must obtain a CA from PSC to construct, extend, improve, or add to its existing facilities.

Under the bill, the office of sustainability and clean energy is directed to create, using rigorous sector-based modeling, an economy-wide decarbonization roadmap. The roadmap is to be updated periodically.

Apprentice utilization standards

Under the bill, a contractor or subcontractor on a construction project of certain electric-generating facilities with estimated construction costs of not less than $10,000,000 must make a good faith effort to utilize specific percentages of registered apprentices on the projects. A contractor or subcontractor that does not meet the utilization thresholds must provide a written explanation to the Department of Workforce Development of the good faith effort to meet the requirement accompanied by supporting documentation. Failure to provide the explanation and supporting documentation subjects the contractor or subcontractor to forfeiture.