Bill
AB 2476
AB 2476 expands DWR’s central procurement role, allowing it to acquire eligible energy resources, including pump hydro, as directed by the CPUC to meet reliability and decarbonizat
Purpose and intent
- AB 2476, introduced by Assembly Member Ellis and co-sponsored by Stan Ellis, seeks to modify California’s integrated resource planning (IRP) framework by clarifying and expanding the Department of Water Resources (DWR) procurement role.
- The bill builds on the Public Utilities Code provisions governing IRPs filed by load-serving entities (LSEs) and the state’s portfolio of resources, with a particular emphasis on enabling the DWR to procure eligible energy resources when directed by the California Public Utilities Commission (CPUC) to meet identified resource needs.
Key provisions and changes
- Pumped hydroelectric facilities
- Current law: DWR may procure resources from a pump hydro facility up to 500 MW if it was directly appropriated state funding before Jan 1, 2023.
AB 2476 adds a significant expansion:
- Removes the requirement that the pump hydro facility must have direct state appropriations before Jan 1, 2023 to be eligible.
- Allows procurement from pump hydro facilities that are exempt from Federal Energy Regulatory Commission (FERC) licensing, provided other statutory criteria are met.
- Commission IRP process (unchanged core framework, with clarified integration)
- The CPUC must maintain a process for each LSE to file IRPs and schedule periodic updates.
- IRPs must address:
- Meeting greenhouse gas (GHG) reduction targets.
- Procurement of at least 60% eligible renewable energy resources by 2030.
- System and local reliability (short-term, midterm, long-term) and resource adequacy.
- Minimizing ratepayer impacts and maintaining just, reasonable rates.
- A diverse portfolio of resources, including demand-side resources and, where appropriate, resources procured by DWR.
- DWR central procurement role (triggered if CPUC determines need)
- On or before Sept 1, 2024, in consultation with the Energy Commission and the Independent System Operator (ISO), CPUC determines whether there is a need to procure additional eligible energy resources.
- If a need is identified, CPUC may specify the resources and, within six months, may request DWR to exercise its central procurement function to procure those resources meeting the identified portfolio.
- DWR may conduct competitive solicitations and enter into contracts to procure eligible energy resources before Jan 1, 2035, with contracts lasting for their full term if approved by CPUC under existing authorities.
- DWR’s central procurement under this provision must follow Division 29.5 of the Water Code (Division governing water resources procurement).
- Plan preparation and certification
- LSEs must prepare IRPs consistent with the CPUC’s schedule, with plans for electrical corporations following existing Section 454.5 guidance and Community Choice Aggregators (CCAs) submitting to their governing boards for approval and CPUC certification.
- Plans must ensure a diversified portfolio, include resource adequacy, and reflect reliability and economic considerations.
- Cost allocation and enforcement
- If additional procurement is authorized, costs must be allocated fairly across customers; no cross-subsidization among LSEs’ customers; CCAs may self-provide renewable integration resources within Section 454.51.
- The CPUC may enforce procurement requirements non-discriminatorily, including penalties for noncompliance.
- Other technical and policy elements
- The bill maintains sequencing to avoid duplicative planning processes and aligns with existing obligations concerning Diablo Canyon and other generation attributes, with specified retirements and limitations on certain resource attributes entering IRP portfolios.
- Defines key terms: load-serving entity, short/mid/long term planning horizons, and emphasizes cost-effectiveness and reliability.
Affected entities and stakeholders
- Load-serving entities (electrical corporations, CCAs, and electrical cooperatives meeting size thresholds)
- Department of Water Resources (DWR), as a processor of state-central procurement actions
- California Public Utilities Commission (CPUC), Energy Commission, and Independent System Operator (ISO)
- Utilities and developers proposing new energy resources, including pump hydro facilities
- Disadvantaged communities, given the statute’s emphasis on reducing localized emissions and targeting benefits
Timeline and procedural notes
- On or before Sept 1, 2024: CPUC, in coordination with Energy Commission and ISO, determines whether there is a need for procurement of eligible energy resources.
- If a need is found: CPUC may request DWR to procure resources within six months of that determination.
- DWR procurement authority: May conduct competitive solicitations and contract procurements before Jan 1, 2035, subject to CPUC approval and Water Code provisions.
- Diablo Canyon-related constraints on entering resource portfolios remain in place, with retirement timing specified.
Bottom line
- AB 2476 broadens DWR’s eligible-procurement role, notably by removing the pre-2023 funding-requirement for pump hydro facilities and permitting procurement from certain long-leased or licensure-exempt pump hydro facilities.
- It preserves the IRP framework while enhancing state-directed procurement capabilities to meet policy goals on reliability, decarbonization, and ratepayer protection, subject to CPUC oversight and coordination with the Energy Commission and ISO.
Compiled from official sources — confirm details with the bill’s official record.
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