California Implements Strict Regulations in Effort to Save the Environment

December 18, 2015

Environmental consciousness is theory that has grown vastly over the years. From the rise in organic product use, to lobbying for full disclosure of products that contain GMOs, to the move of some states to mandate energy disclosures, environmental issues have come to forefront of many legislative sessions. It has been reported that the State of California emits greenhouse gas at an alarming rate every year. Due to the rapid growth in population in recent years, California is the second largest greenhouse gas emitting state in the US. Over 30% of that greenhouse gas release can be attributed to the production of electricity taking place in the state. In response to the harmful nature and after endless lobbying, Assembly Bill 802 was drafted. Assembly Bill 802 focuses on disclosure.

In an effort to closely monitor the problem and resolve the issue, mainly in commercial buildings, Assembly Bill 1103 was enacted in 2009. This bill requires those who own commercial properties to allow public utility companies to regularly collect energy consumption data. Additionally, the public utility companies disclose the data collected to potential purchasers, financial institutions providing loans, and even individuals looking to rent space in particular building. Although the bill was adopted in 2009, it did not go into effect until 2014 due to pushback. Response to the implementation of the new law was not positive, especially because there were no clear and concise guidelines or protocols regarding violations of the law.

Those who had been ordered to comply by disclosing information decided that the fine was worth disclosure. Disclosure of energy use could result in several adverse issues for the owner of the building. Due to the noncompliance of a majority of owners, Governor Brown introduced Assembly 802, a new piece of legislation that replaced AB 1103 and modified the process in which data was collected. Effective January 1, 2016, AB 802 provides that public utility companies will be tasked with maintaining energy consumption data for the last year for all buildings serviced by their company. The goal and purpose behind introduction of this new piece of legislation all lies with disclosure. Those who own buildings that produce energy at a high rate or fail to meet energy efficiency standards are given incentive to make the necessary repairs. By not doing so, they stand to lose potential buyers and tenants. With this new law their insufficiencies are public record and out there for anyone to assess.

Beginning January 1, 2016, utilities in California will be required to maintain records of energy use data for the most recent 12 months for all buildings to which they provide service. Generally, disclosure of this type of data is strictly prohibited due to the nature of the information. A provision of the law protects owners, as well as, the public utility company from liability resulting from disclosure of this confidential data. The data collection process is based upon normalized metered energy consumption, also referred to as, metered savings. Metered savings can defined as monitoring of the rate in which energy is used and further fluctuation of energy use when there have been implementation of "energy saving products and functions" Lawmakers hope that modification of this energy monitoring mandate will provide accurate data for energy savings programs, assist in the effort to become more environmentally conscious, and decrease the emissions of greenhouse gases in the State of California.