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Incentives/Policies for Renewables & Efficiency

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Public Benefits Funds for Renewables and Efficiency   

Last DSIRE Review: 07/18/2012
Program Overview:
State: California
Incentive Type: Public Benefits Fund
Eligible Efficiency Technologies: Unspecified Technologies
Eligible Renewable/Other Technologies: Solar Thermal Electric, Photovoltaics, Landfill Gas, Wind, Biomass, Hydroelectric, Geothermal Electric, Municipal Solid Waste, (Note: small hydro is 30 MW or less), Anaerobic Digestion, Small Hydroelectric, Tidal Energy, Wave Energy, Ocean Thermal, Fuel Cells using Renewable Fuels
Applicable Sectors: Commercial, Industrial, Residential, General Public/Consumer, Utility, Institutional
Types:Renewables, Energy Efficiency, RD&D
Total Fund:Renewables: 2002-2006: $135 million annually*; 2007: $135 million annually*; 2008-2011: $65.5 million annually*
Efficiency: $228 million annually
RD&D: $62.5 million annually
Beginning 2005, natural gas subaccount baseline funding of $12 million with increase of up to $3 million annually, capping at $24 million
Charge:Rates vary by utility and customer type:
Renewables: ~1.6 mills/kWh
Efficiency: ~5.4 mills/kWh
RD&D: ~1.5 mills/kWh
Authority 1:
CA Public Resources Code ยง 25710, et seq.

California's 1996 electric industry restructuring legislation (AB 1890) directed the state’s three major investor-owned utilities (Southern California Edison, Pacific Gas and Electric Company, and San Diego Gas & Electric) to collect a "public goods charge" (PGC) on ratepayer electricity use from 1998 through 2001 to create public benefits funds for renewable energy, energy efficiency, and research, development & demonstration (RD&D).

Subsequent legislation in 2000 extended the programs for 10 years from 2002 to 2012. This fund is used by the California Energy Commission (CEC) to administer renewable energy and RD&D programs, and by the electric utilities to administer energy efficiency incentive programs. The California Public Utilities Commission separately collects funds to administer the California Solar Initiative, the Self-Generation Incentive Program, the Renewables Portfolio Standard and others. These programs are separate from the PGC, and are not discussed here.

Renewable Energy and RD&D Funding

The California legislature did not pass legislation in 2011 to authorize PGC collections in 2012 or later years. But the California Public Utilities Commission (CPUC) stated in Decision 11-12-035 that even though their authority to collect funds under Public Utilities Code 399.8 expired, the CPUC still has authority to collect funds through a PGC from Public Utilities Code 381, which has no expiration. The same decision created a new fund, the Electric Program Investment Charge Fund (EPICF), which will be used to collect funds to continue support for renewable energy and RD&D projects. Senate Bill 1018 of 2012 later provided the statutory authority for the EPICF. The portion of the PGC used to support energy efficiency is not accounted for in the new EPICF, but was addressed separately, and is discussed below.

Decision 11-12-035 established the EPICF on an interim basis, and kept funding levels basically the same as the previous year. But this decision is only Phase 1 of a 2-Phase decision. The Phase 2 decision will determine how the money in the fund will be allocated between programs. Further, Senate Bill 1018 of 2012 withdrew funding for the Emerging Renewables Program, which had previously received the most funding of the California Energy Commission’s renewable energy programs. It is unclear at this time how the EPICF will be administered. Click here for more information about California’s renewable energy programs.

Energy Efficiency Funding

The California Public Utilities Commission (CPUC) oversees the allocation of energy efficiency funds for program implementation to each of the four investor-owned utilities in California: Pacific Gas & Electric, Southern California Edison, Southern California Gas Company, and San Diego Gas & Electric. The original restructuring legislation did not address surcharges on natural gas companies. AB 1002, signed in 2000, established a gas surcharge for energy efficiency, low income assistance, and RD&D, beginning in 2001. Every year, the CPUC approves each utility's plan for efficiency programs, which the utility then carries out within its service territory. A number of programs are also coordinated on a statewide basis.

Energy efficiency programs were originally funded by the PGC. With the expiration of that fund, the CPUC approved a decision in December 2011 to use a portion of the Procurement Energy Efficiency Balancing Account (PEEBA) to replace the PGC funding. This decision is only valid for the 2010-2012 funding cycle. Further commission action will be needed to continue funding these programs beyond 2012.

See the financial incentive section of DSIRE’s California page for individual utility energy efficiency incentive programs. 


  Le-Quyen Nguyen
California Energy Commission
1516 Ninth Street, MS-29
Sacramento, CA 95814-5512
Phone: (916) 654-4058
Phone 2: (800) 555-7794
Fax: (916) 654-4420
Web Site:
  Energy Efficiency Program
California Public Utilities Commission
4th Floor - 505 Van Ness Ave
San Francisco, CA 94102
Phone: (415) 703-2776
Web Site:
NCSU - home
Disclaimer: The information presented on the DSIRE web site provides an unofficial overview of financial incentives and other policies. It does not constitute professional tax advice or other professional financial guidance, and it should not be used as the only source of information when making purchasing decisions, investment decisions or tax decisions, or when executing other binding agreements. Please refer to the individual contact provided below each summary to verify that a specific financial incentive or other policy applies to your project.

While the DSIRE staff strives to provide the best information possible, the DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. make no representations or warranties, either express or implied, concerning the accuracy, completeness, reliability or suitability of the information. The DSIRE staff, the N.C. Solar Center, N.C. State University and the Interstate Renewable Energy Council, Inc. disclaim all liability of any kind arising out of your use or misuse of the information contained or referenced on DSIRE Web pages.

Copyright 2014 - 2015 North Carolina State University, under NREL Subcontract No. XEU-0-99515-01. Permission granted only for personal or educational use, or for use by or on behalf of the U.S. government. North Carolina State University prohibits the unauthorized display, reproduction, sale, and/or distribution of all or portions of the content of the Database of State Incentives for Renewables and Efficiency (DSIRE) without prior, written consent.