CA Pub Util Code Section 399.12.6

(a)

(1)Any procurement of biomethane delivered through a common carrier pipeline under a contract executed by a retail seller or local publicly owned electric utility and reported to the Energy Commission prior to March 29, 2012, and otherwise eligible under the rules in place as of the date of contract execution shall count toward the procurement requirements established in this article, under the rules in place at the time the contract was executed, including the Fourth Edition of the Energy Commission’s Renewables Portfolio Standard Eligibility Guidebook, provided that those rules shall apply only to sources that are producing biomethane and injecting it into a common carrier pipeline on or before April 1, 2014.

(2)

The eligibility requirements of subdivision (b) shall apply beginning March 29, 2012, to any quantities of biomethane associated with any of the following:

(A)

An extension of the term of the original contract.

(B)

Any quantity of biomethane that exceeds the quantities of biomethane specified in the original contract.

(C)

Any optional quantities of biomethane that can be exercised at the discretion of the buyer.

(D)

Any change in the source or sources of biomethane identified in the original contract or the original application for certification submitted to the Energy Commission.

(E)

Any quantity of biomethane from a source not producing and capturing biomethane and injecting it into a common carrier pipeline on or before April 1, 2014.

(F)

The conditions of this paragraph shall apply beginning March 29, 2012.

(b)

For contracts initially executed on or after March 29, 2012, or for quantities of biomethane associated with contract amendments executed on or after March 29, 2012, the use of biomethane by a generating facility shall not qualify as an eligible renewable energy resource unless it satisfies all applicable requirements established by the Energy Commission and meets any of the following requirements:

(1)

The biomethane is used by an onsite generating facility.

(2)

The biomethane is used by an offsite generating facility and delivered to the generating facility through a dedicated pipeline.

(3)

The biomethane is delivered to a generating facility through a common carrier pipeline and meets all of the following requirements:

(A)

The source of biomethane injects the biomethane into a common carrier pipeline that physically flows within California or toward the generating facility for which the biomethane was procured under the original contract.

(B)

The source of biomethane did not inject biomethane into a common carrier pipeline prior to March 29, 2012, or the source commenced injection of sufficient incremental quantities of biomethane after March 29, 2012, to satisfy the contract requirements.

(C)

The seller or purchaser of the biomethane demonstrates that the capture and injection of biomethane into a common carrier pipeline directly results in at least one of the following environmental benefits to California:

(i)

The reduction or avoidance of the emission of any criteria air pollutant in California.

(ii)

The reduction or avoidance of pollutants that could have an adverse impact on waters of the state. (iii)The alleviation of a local nuisance within California that is associated with the emission of odors.

(c)

For all electricity products generated using biomethane that are credited toward the renewables portfolio standard procurement obligations established pursuant to this article, sufficient renewable and environmental attributes of biomethane production and capture shall be transferred to the retail seller or local publicly owned electric utility that uses that biomethane to ensure that there are zero net emissions associated with the production of electricity from the generating facility using the biomethane. The provisions of this subdivision shall be applied in a manner consistent with the definition of “green attributes” as specified by the commission in Decision 08-08-028, Decision on Definition and Attributes of Renewable Energy Credits for Compliance with the California Renewables Portfolio Standard (August 21, 2008), as may be modified by subsequent decision of the commission.

(d)

All sellers and purchasers of biomethane shall comply with a system for tracking and verifying the use of biomethane, as established by the Energy Commission, that is equivalent to the system required by subdivision (c) of Section 399.25.

(e)

For contracts initially executed on or after March 29, 2012, or for quantities of biomethane associated with contract amendments executed after March 29, 2012, the use of biomethane shall be assigned to the appropriate portfolio content category based on the application of the criteria in subdivision (b) of Section 399.16 to the procurement of electricity by the retail seller or local publicly owned electric utility from the generating facility consuming the biomethane.

(f)

A retail seller, local publicly owned electric utility, or an intermediary party to a biomethane procurement contract shall not make a marketing, regulatory, or retail claim that asserts that a biomethane procurement contract to which that entity was a party resulted, or will result, in greenhouse gas reductions related to the destruction of methane if the capture and destruction is required by law. If the capture and destruction of the biomethane is not required by law, a retail seller, local publicly owned electric utility, or an intermediary party to a biomethane procurement contract shall not make a marketing, regulatory, or retail claim that asserts that a biomethane procurement contract to which that entity was a party resulted, or will result, in greenhouse gas reductions related to the destruction of methane, unless the environmental attributes associated with the capture and destruction of the biomethane pursuant to that contract are transferred to the retail seller or publicly owned electric utility that purchased that biomethane and retired on behalf of the retail customers consuming the electricity associated with the use of that biomethane, or unless the biomethane procurement contract prohibits the source of biomethane from separately marketing the environmental attributes associated with the capture and destruction of the biomethane sold pursuant to that contract. These attributes shall be retired and may not be resold.

(g)

For the purposes of this section, “biomethane” means landfill gas or digester gas, consistent with Section 25741 of the Public Resources Code.

(h)

If any provision of this section or the application of any provision of this section is held invalid, biomethane delivered through a common carrier pipeline pursuant to a contract executed within 180 days of, or at any time subsequent to, the invalidation of that provision shall not qualify as an eligible renewable energy resource.