AB196 - School Energy Efficiency Stimulus Program.

Corrected August 30, 2026 Amended IN Senate August 28, 2026 CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION Assembly Bill No. 196 Introduced by Assembly Member Gabriel Committee on Budget (Assembly Members Gabriel (Chair), Addis, Ahrens, Alvarez, Bennett, Bonta, Caloza, Connolly, Fong, Haney, Hart, Jackson, Lee, Ortega, Patel, Petrie-Norris, Quirk-Silva, Ramos, Rogers, Schiavo, Schultz, Sharp-Collins, Solache, Stefani, Ward, and Wilson) January 08, 2025 An act relating to the Budget Act of 2025. to amend Section 25208 of the Public Resources Code, and to amend Sections 1615, 1616, and 1640 of the Public Utilities Code, relating to energy, and making an appropriation therefor, to take effect immediately, bill related to the budget. LEGISLATIVE COUNSEL'S DIGEST AB 196, as amended, Committee on Budget. Budget Act of 2025. School Energy Efficiency Stimulus Program. Existing law vests the Public Utilities Commission (PUC) with regulatory authority over public utilities, including electrical corporations and gas corporations. Existing law requires the PUC to require those electrical corporations with 250,000 or more customer accounts in the state, and those gas corporations with 400,000 or more customer accounts in the state, to fund as part of their energy efficiency portfolios the joint School Energy Efficiency Stimulus Program, which consists of the School Reopening Ventilation and Energy Efficiency Verification and Repair Program (SRVEVR Program) and the School Noncompliant Plumbing Fixture and Appliance Program (SNPFA Program). Existing law requires, for each program year, that 75% of these moneys are allocated to the SRVEVR Program and that 25% of these moneys are allocated to the SNPFA Program. Existing law requires that the School Energy Efficiency Stimulus Program be a joint program among all the participating utilities, be consistent across the utility territories, and be designed, administered, and implemented by the State Energy Resources Conservation and Development Commission (Energy Commission) as the program administrator. The Energy Commission administratively established the School Energy Efficiency Stimulus Program Fund and existing law continuously appropriates moneys in the fund to the Energy Commission for purposes of the program. Existing law requires all allocated funds to be spent or returned to each electrical corporation or gas corporation by December 1, 2026. Existing law authorizes the Energy Commission to set application and encumbrance deadlines to ensure that the reversion of funds occurs by December 1, 2026. This bill would extend the operation of the School Energy Efficiency Stimulus Program to January 1, 2031. The bill would require the funds to be encumbered by December 1, 2028, and would extend the date by which all funds allocated pursuant to the program are required to be spent or returned to each utility to December 1, 2029, as specified. The bill would authorize the Energy Commission to set application and encumbrance deadlines to ensure that the encumbrance of these funds occurs by December 1, 2028, and that the reversion of these funds occurs instead by December 1, 2029, and would require the Energy Commission to make all reasonable efforts to ensure that schools have the opportunity to apply for and receive grants and complete funded projects before those dates, as specified. The bill would extend the liquidation period for all grants awarded through the School Energy Efficiency Stimulus Program before August 1, 2026, until October 1, 2029. Beginning July 1, 2026, the bill would require 100% of the moneys for the School Energy Efficiency Stimulus Program to be allocated to the SRVEVR Program. By extending the term of a continuous appropriation, the bill would make an appropriation. Existing law requires the Energy Commission, until March 1, 2027, to annually submit a report to the relevant policy committees of the Legislature and the Joint Legislative Budget Committee describing programmatic activities and spending pursuant to the School Energy Efficiency Stimulus Program, as specified. This bill would extend the operation of this annual reporting requirement until March 1, 2031. Under existing law, a violation of the Public Utilities Act is a crime. Because certain provisions of this bill would be part of the act, the violation of which would be a crime, the bill would impose a state-mandated local program. The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement. This bill would provide that no reimbursement is required by this act for a specified reason. This bill would declare that it is to take effect immediately as a bill providing for appropriations related to the Budget Bill. This bill would express the intent of the Legislature to enact statutory changes relating to the Budget Act of 2025. Digest Key Vote: MAJORITY Appropriation: NO YES Fiscal Committee: NO YES Local Program: NO YES Bill Text The people of the State of California do enact as follows: SECTION 1. Section 25208 of the Public Resources Code is amended to read: 25208. (a) By March 1, 2022, and by each March 1 thereafter, until March 1, 2027, 2031, the commission shall submit a report to the relevant policy committees of the Legislature and the Joint Legislative Budget Committee describing programmatic activities and spending pursuant to the School Energy Efficiency Stimulus Program. The report shall be submitted in compliance with Section 9795 of the Government Code. (b) The report shall include both of the following: (1) A description of any changes to guidelines and budget. (2) A summary of past spending, activities funded, and expected changes in funding and activities for the next year. (c) As part of the report, the commission may include information that is already provided in reports submitted to and approved by the Public Utilities Commission, as applicable. (d) Pursuant to Section 10231.5 of the Government Code, this section is repealed on January 1, 2032. 2036. SEC. 2. Section 1615 of the Public Utilities Code is amended to read: 1615. (a) (1) The commission shall require each utility to fund the School Energy Efficiency Stimulus Program by allocating their energy efficiency budgets for program years 2021, 2022, and 2023, in both of the following amounts: (A) An amount equal to the applicable percentage of the difference between the budget contained in each utility’s 2020 annual budget advice letter approved as of July 1, 2020, and the annual portfolio funding limitation for program year 2020 as set forth in the 2018–2025 business plan of each utility as approved and modified in ordering paragraph 45 of the commission’s Decision 18-05-041 (May 31, 2019) 2019), Decision Addressing Energy Efficiency Business Plans, as modified by Decision 20-02-029 (February 6, 2020) 2020), Order Modifying Decision (D.) 18-05-041 and Denying Rehearing of Decision, as Modified. The applicable percentage is 80 percent for program year 2021, 70 percent for program year 2022, and 60 percent for program year 2023. (B) Any carryover amount from unspent and uncommitted energy efficiency funds for program year 2020, 2021, or 2022 to the School Energy Efficiency Stimulus Program for the following year’s budget. (2) Funding allocations required by this subdivision shall only apply to program years 2021, 2022, and 2023. (3) Any funds allocated towards the School Energy Efficiency Stimulus Program pursuant to this section that remain unspent by the end of each program year may be carried over and contribute to the next year’s budget for the School Energy Efficiency Stimulus Program until the end of the 2023 energy efficiency program year. (b) (1) This section does not authorize the levy of a charge or any increase in the amount collected pursuant to an existing charge beyond the amounts authorized by the commission in Decision 18-05-041, or as modified by Decision 20-02-029, nor does it add to, or detract from, any existing authority of the commission to levy or increase charges. (2) This subdivision does not change the commission’s authority to determine revenue allocation and rate design, including its ability to prioritize customers participating in the California Alternative Rates for Energy or Family Electric Rate Assistance programs when considering appropriate revenue allocation for energy efficiency programs. (c) The Energy Commission shall ensure that moneys from each utility for the School Energy Efficiency Stimulus Program are used for projects located in the service territory of that utility from which the moneys are received. (d) The Energy Commission may use no more than 5 percent, not to exceed five million dollars ($5,000,000) per year, of the SRVEVR Program and the SNPFA Program funds for administrating the programs, including providing technical support to program participants. The commission shall ensure that funds allocated to the Energy Commission pursuant to this section are transferred to an account specified by the Energy Commission within 60 days after the completion of the prior energy efficiency program year. (e) (1) The School Energy Efficiency Stimulus Program Fund was administratively established for the Energy Commission to receive funds allocated pursuant to this chapter. (2) Notwithstanding Section 13340 of the Government Code, the moneys in the School Energy Efficiency Stimulus Program Fund are hereby continuously appropriated to the Energy Commission without regard to fiscal years for the purposes of the School Energy Efficiency Stimulus Program established pursuant to this chapter, including, but not limited to, paying the costs of program administration. (f) All funds allocated in subdivision (a) shall be encumbered by December 1, 2028, and shall be spent or returned to each utility by December 1, 2026. 2029. (g) The Energy Commission may set application and encumbrance deadlines to ensure that the encumbrance of funds as required by subdivision (f) occurs by December 1, 2028, and that the reversion of funds as required by subdivision (f) occurs by December 1, 2026. 2029. The Energy Commission shall make all reasonable efforts to ensure that schools have the opportunity to apply for and receive grants and complete funded projects before these dates so that funds allocated in subdivision (a) are used to the maximum extent possible to benefit schools. (h) Notwithstanding any other law, the liquidation period for all grants awarded through the School Energy Efficiency Stimulus Program, also known as the California Schools Healthy Air, Plumbing, and Efficiency Program, before August 1, 2026, shall be extended until October 1, 2029. (h) (i) The Energy Commission shall take steps, consistent with Section 25230 of the Public Resources Code, to ensure that a diverse group of contractors are aware of funding opportunities available through the School Energy Efficiency Stimulus Program. SEC. 3. Section 1616 of the Public Utilities Code is amended to read: 1616. (a) Moneys for the School Energy Efficiency Stimulus Program for each program year shall be allocated as follows: (a) (1) Seventy-five percent to the SRVEVR Program. (b) (2) Twenty-five percent to the SNPFA Program. (b) Notwithstanding subdivision (a), beginning July 1, 2026, 100 percent of the moneys for the School Energy Efficiency Stimulus Program shall be allocated to the SRVEVR Program. (c) The SRVEVR Program shall prioritize applications for funding by schools that require additional funding for cost-effective energy efficiency upgrades or repairs to ventilation systems pursuant to paragraph (2) of subdivision (c) of Section 1621. SEC. 4. Section 1640 of the Public Utilities Code is amended to read: 1640. This chapter shall remain in effect only until January 1, 2027, 2031, and as of that date is repealed. SEC. 5. No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIII B of the California Constitution. SEC. 6. This act is a bill providing for appropriations related to the Budget Bill within the meaning of subdivision (e) of Section 12 of Article IV of the California Constitution, has been identified as related to the budget in the Budget Bill, and shall take effect immediately. SECTION 1. It is the intent of the Legislature to enact statutory changes relating to the Budget Act of 2025. ___________________ CORRECTIONS: Heading—Line 1. Digest—Page 1. ___________________