ENERGY & ENVIRONMENTAL RESOURCES COMMITTEE

ENERGY & ENVIRONMENTAL RESOURCES COMMITTEE Thursday, March 10, 2011 12:00 Noon CVAG Offices 73-710 Fred Waring Drive, Suite 119 Palm Desert, CA 92260 (760) 346-1127 THIS MEETING IS HANDICAPPED ACCESSIBLE. ACTION MAY RESULT ON ANY ITEMS ON THIS AGENDA 1. CALL TO ORDER (Mayor Steve Pougnet, City of Palm Springs, Chair) 2. ROLL CALL A. Member Roster P. 4 3. PLEDGE OF ALLEGIANCE 4. PUBLIC COMMENTS This is the time and place for any person wishing to address the Energy and Environmental Resources Committee to do so. 5. COMMITTEE MEMBER/DIRECTOR COMMENTS

6. CONSENT CALENDAR A. Approval of the January 13, 2011 Energy & Environmental Resources Committee Minutes P. 5 Recommendation: Approve. B. Support for Coachella Valley Mountains Conservancy Funding in State Water Bond SB2 - Katie Barrows P. 9 Recommendation: Recommend Executive Committee Support for Inclusion of Coachella Valley Mountains Conservancy in any future State Water Bond and authorize the Chair or Executive Director to contact local legislators requesting their support and to sign a letter of support if necessary. C. Receive and File 1) Energy and Environmental Resources Committee Attendance Roster P. 10 7. DISCUSSION / ACTION A. Presentation by the City of Indian Wells on Indian Wells Villas: A Green and Sustainable Low Income Housing Project - Corrie Kates B. Vacancy for SCAG s Energy and Environment Committee Aurora Wilson P. 11 Recommendation: Select an elected official from CVAG s Energy and Environmental Resources Committee or the CVAG membership to serve as CVAG s representative to SCAG s Energy and Environment Committee. C. Request for Proposal for Regional PM-10 Street Sweeping Program Aurora Wilson P. 15 Recommendation: 1) Authorize staff to prepare and issue a Request for Proposal (RFP) for operations of the Regional PM10 Street Sweeping Program; 2) Authorize the Executive Director to enter into negotiations with the recommended operator. D. 2011 Coachella Valley Energy Summit May 12 and May 13, 2011 Katie Barrows P. 16 Recommendation: Participate in 2011 Energy Summit on Thursday, May 12 and Friday, May 13, 2011. E. Update on Energy Efficiency Strategic Plan Katie Barrows Staff will provide an oral report. 2

F. Support for Energy Efficiency Funding for Southern California Gas Company Katie Barrows P. 19 Recommendation: Authorize a letter Opposing Transfer of Energy Efficiency Funds from Southern California Gas Company to the State General Fund. G. Energy and Water Conservation Subcommittee Katie Barrows P. 22 Recommendation: Discuss Discontinuation of Energy and Water Conservation Subcommittee. 8. LEGISLATIVE UPDATE A. AB 61 Neighborhood Electric Vehicle Legislation Katie Barrows Staff will provide an oral report. 9. ANNOUNCEMENTS Next Scheduled Meeting: Energy & Environmental Resources Committee Thursday, April 14, 2011, 12:00 noon, at 73-710 Fred Waring Drive, Suite 119, Palm Desert, CA. 3

Item 2A Coachella Valley Association of Governments Energy & Environmental Resources Committee Roster Energy and Environmental Resources Committee Members City of Blythe Councilmember Richard Contreras City of Cathedral City Councilmember Sam Toles City of Coachella Councilmember Emmanuel Martinez City of Desert Hot Springs Mayor Yvonne Parks, Vice Chair City of Indian Wells Councilmember Larry Spicer City of Indio Councilmember Michael Wilson City of La Quinta Councilmember Stanley Sniff City of Palm Desert Councilmember Cindy Finerty City of Palm Springs Mayor Stephen Pougnet, Chair City of Rancho Mirage Councilmember Gordon Moller County of Riverside, 4 th District Supervisor John J. Benoit Mission Springs Water District Board Member Nancy Wright Imperial Irrigation District Board Member Anthony Sanchez Agua Caliente Band of Cahuilla Indians Tribal Vice Chair Jeff L. Grubbe Cabazon Band of Mission Indians Unassigned Non-Voting Members Coachella Valley Water District Board President Corky Larson Desert Water Agency Board Member Patricia Oygar Staff Tom Kirk, Executive Director Katie Barrows, Director of Environmental Resources Aurora Wilson, Director of Community Resources Jim Sullivan, GIS Program Director Jacob Alvarez, Management Analyst Linda Rogers, Program Assistant II

Item 6A Energy & Environmental Resources Committee Meeting Minutes January 13, 2011 The audio file for this committee can be found at: http://www.cvag.org/minutes.htm 1. CALL TO ORDER The meeting of the Energy and Environmental Resources Committee was called to order by Vice Chair Stephen Pougnet at 12:08 p.m. on January 13, 2011. 2. PLEDGE OF ALLEGIANCE Mayor Kathleen DeRosa led in the Pledge of Allegiance. 3. ROLL CALL Roll call was taken and it was determined that a quorum was present. Members Present Councilmember Richard Contreras Mayor Kathleen DeRosa Mayor Yvonne Parks Councilmember Michael Wilson Councilmember Stan Sniff Councilmember Cindy Finerty Mayor Stephen Pougnet, Supervisor John J. Benoit Board Member Nancy Wright Members Absent Mayor Eduardo Garcia Councilmember Larry Spicer Councilmember Gordon Moller Board Member Anthony Sanchez Board Member Corky Larson Board Member Patricia Oygar Others Present Councilmember Sam Patel Deborah McGarrey Jim Lucas Danielle Soto Agency City of Blythe City of Cathedral City City of Desert Hot Springs City of Indio City of La Quinta City of Palm Desert City of Palm Springs County of Riverside 4 th District Mission Springs Water District City of Coachella City of Indian Wells City of Rancho Mirage Imperial Irrigation District Coachella Valley Water District (ex officio) Desert Water Agency (ex officio) City of Blythe Southern California Gas Co. Southern California Gas Co. South Coast Air Quality Mgmt. District 1

Kay Hazen Ralene Friend Karen Boyle Terry Siemens Sharalee Sniff Kay Hazen and Co. College of the Desert Learning Gurus Siemens Associates Visitor CVAG Staff Tom Kirk Katie Barrows Jim Sullivan Jacob Alvarez Linda Rogers 4. PUBLIC COMMENTS Terry Seimens, resident of Rancho Mirage, addressed the committee and distributed a handout regarding Smart Meters and discussed some potential health hazards. 5. COMMITTEE MEMBER & DIRECTOR COMMENTS Mayor DeRosa stated that this would be her last official meeting and that Councilmember Sam Toles would be the new appointment to the Energy & Environmental Resources Committee by Cathedral City. Mayor DeRosa will now serve as the alternate representative to the Energy and Environmental Resources Committee. Katie Barrows advised that CVAG has been awarded a grant from CalRecycle to do a Tire Recycling program. A number of those events have already occurred and over 1500 tires have been collected. All CVAG cities are participating in tire recycling events. Residents from the Coachella Valley can attend any event and bring in as many as 9 tires to be recycled. 6. CONSENT CALENDAR APPROVAL: IT WAS MOVED BY COUNCILMEMBER SNIFF AND SECONDED BY MAYOR DEROSA TO: A. Approve the November 4, 2010 Energy & Environmental Resources Committee Minutes. THE MOTION CARRIED. B. Receive and File 1) Energy and Environmental Resources Committee Attendance Roster Item B1 was received and filed. 7. DISCUSSION / ACTION A. Nomination of Chair for FY 2010/2011 Energy & Environmental Resources Committee 2 Meeting Minutes 1-13-11

Tom Kirk informed the committee that the E&E Chair was not successful in his bid for reelection thereby creating an opening for Chair. Currently the Vice Chair is Mayor Steve Pougnet. Tom Kirk opened up nominations for Chair. Mayor DeRosa nominated Mayor Pougnet for Energy & Environmental Resources Committee Chair. IT WAS MOVED BY MAYOR DEROSA AND SECONDED BY SUPERVISOR BENOIT THAT MAYOR POUGNET BE ELECTED AS CHAIR OF THE ENERGY AND ENVIRONMENTAL RESOURCES COMMITTEE. THE MOTION WAS UNANIMOUS. Nominations were then opened for Vice Chair. Chair Mayor Parks was nominated for Vice IT WAS MOVED BY MAYOR DEROSA AND SECONDED BY COUNCILMEMBER SNIFF THAT MAYOR PARKS BE ELECTED AS VICE CHAIR. THE MOTION WAS UNANIMOUS. B. Vacancy for SCAG s Energy and Environment Committee IT WAS MOVED BY MAYOR PARKS AND SECONDED BY COUNCILMEMBER WILSON TO APPOINT SUPERVISOR JOHN J. BENOIT TO SERVE AS CVAG S REPRESENTATIVE TO SCAG S ENERGY AND ENVIRONMENT COMMITTEE. THE MOTION CARRIED. C. Presentation of CVAG OnLine Landscape Certification Course Aurora Wilson demonstrated the CVAG OnLine Landscape Certification Course hosted on College of the Desert s (COD s) website. Staff from COD and the Learning Gurus (a company in San Diego) were present to answer questions. D. Letter of Support for Southern California Gas Company Program to Increase Renewable Biogas IT WAS MOVED BY COUNCILMEMBER SNIFF AND SECONDED BY SUPERVISOR BENOIT RECOMMENDING THE EXECUTIVE COMMITTEE APPROVE A LETTER OF SUPPORT FOR A SOUTHERN CALIFORNIA GAS COMPANY PROGRAM TO DEVELOP BIOGAS AS A RENEWABLE NATURAL GAS. THE MOTION CARRIED. E. Budget for Used Oil Recycling Program IT WAS MOVED BY COUNCILMEMBER SNIFF AND SECONDED BY COUNCILMEMBER FINERTY RECOMMENDING THE EXECUTIVE COMMITTEE APPROVE THE USED OIL RECYCLING PROGRAM BUDGET FOR THE 2011 USED OIL RECYCLING EVENTS. THE MOTION CARRIED. Energy & Environmental Resources Committee 3 Meeting Minutes 1-13-11

8. ANNOUNCEMENTS A. E&E Committee 2011 Meeting Schedule: January 13; March 10; April 14; June 9; July 14; September 8; and November 10. B. Chair Pougnet requested that the Committee consider the following agenda item for the next meeting to formally disband the Energy and Water Conservation Subcommittee. Next Scheduled Meeting: Energy & Environmental Resources Committee Thursday, March 10, 2011, 12:00 noon, at 73-710 Fred Waring Drive, Suite 119, Palm Desert, CA The meeting adjourned at 12:35 p.m. Respectfully submitted, Linda Rogers Linda Rogers Program Assistant II Energy & Environmental Resources Committee 4 Meeting Minutes 1-13-11

Item 6B Coachella Valley Association of Governments Energy and Environmental Resources Committee March 10, 2011 Staff Report Subject: Contact: Support for Coachella Valley Mountains Conservancy Funding in State Water Bond SB2 Katie Barrows, Director of Environmental Resources (kbarrows@cvag.org) RECOMMENDATION: Recommend Executive Committee Support for Inclusion of Coachella Valley Mountains Conservancy in any future State Water Bond and authorize the Chair or Executive Director to contact local legislators requesting their support and to sign a letter of support if necessary. BACKGROUND: State funding for conservation projects including habitat conservation is often provided through statewide bond measures approved by the voters. The Coachella Valley Mountains Conservancy (CVMC) currently funds acquisition of open space lands including CVMSHCP lands through funds from Proposition 84, the Safe Drinking Water, Water Quality and Supply, Flood Control, River and Coastal Protection Bond Act which was approved by voters in 2006. Last year, an $11 billion State Water Bond was originally proposed for the November 2010 ballot. However, due to the economic slump, state lawmakers pulled the initiative from the November ballot and put it off until the 2012 election.the proposed Water Bond included funding for water supply, storage, conservation, and sustainability projects and programs throughout the state. The 2010 Water Bond included funding for all of the state conservancies except the Coachella Valley Mountains Conservancy. Now is a good time to encourage our local legislators to support inclusion of the Coachella Valley Mountains Conservancy in any future water bond to fund conservation and watershed protection. Allocation of bond funds to the Coachella Valley Mountains Conservancy has been a major benefit to the implementation of the CVMSHCP and the Coachella Valley by providing funds to help meet the state s commitment to the land acquisition program. While there is still considerable uncertainty about when, or if, the legislature might reconsider a new water bond, there has been some indication that a bill may be introduced to amend the water bond proposal this year. The request is for CVAG to authorize staff and the Chair to approach our local state legislators to request their support to ensure that CVMC is given parity with the other state conservancies in any future water bond. In the 2010 Water Bond the Santa Monica Mountains Conservancy and the San Gabriel/Lower Los Angeles Rivers and Mountains Conservancy were included for $75 million each; the territory of each of these conservancies is roughly equivalent in size with CVMC s territory. When CVMC s Proposition 84 funds are exhausted, there is very little prospect for a new state bond measure other than the water bond to provide a new source of habitat acquisition funding to CVMC. Acquisitions by CVMC not only benefit the CVMSHCP. These acquisitions provide for open space, trails, recreational opportunities, cultural resources, and the magnificent scenic vistas of the Coachella Valley mountains. It is appropriate for CVAG to support ongoing efforts to get CVMC included in any future water bond measure should it go on the 2012 ballot. FISCAL ANALYSIS: Information only

Jurisdictions Voting Members: Blythe Cathedral City Coachella Desert Hot Springs Indian Wells Indio La Quinta Palm Desert Palm Springs Rancho Mirage Riverside County - 4th District Imperial Irrigation District (IID) Mission Springs Water District Non-Voting Members: Coachella Valley Water Dist. Desert Water Agency @ May 2010 2011 Attendance Roster Energy and Environmental Resources Committee Jan Mar Apr June Jul Sept Nov X X X X X X X X X CALENDAR YEAR 2011 Item 6C.1 V or T = Elected in attendance via Video(V) or Teleconference(T) X = Elected member in attendance = Member Absent = Non-Voting Member Absent * CVAG Committees go dark in August and December ** The committee did not meet in February Prepared on 3/4/2011

Item 7B Coachella Valley Association of Governments Energy and Environmental Resources Committee March 10, 2011 Staff Report Subject: Contact: Vacancy for SCAG s Energy and Environment Committee Aurora Wilson, Director, Community Resources (awilson@cvag.org) Recommendation: Select an elected official from CVAG s Energy and Environmental Resources Committee or the CVAG membership to serve as CVAG s representative to SCAG s Energy and Environment Committee. Background: This item was presented back in January. The November 2010 election results created a vacancy for a CVAG representative on SCAG s Energy and Environment (E&E) Committee. At the January meeting, Supervisor John Benoit volunteered to serve as the representative. Following the meeting, however, Supervisor Benoit withdrew his name as he currently attends the SCAG Transportation Committee which conflicts with the start time of the SCAG E&E Committee. SCAG s E&E Committee meetings are generally held on the first Thursday of each month at 10 a.m., at SCAG s offices, 818 W. 7 th Street, 12 th Floor, Los Angeles. The SCAG Energy & Environment Committee considers environmental and energy issues of regional significance, including but not limited to air quality, water quality, solid and hazardous waste, habitat preservation, environmental justice, and environmental impact analysis. Attached is the agenda from their February meeting. Attendance: Per SCAG Regional Council Policy Manual: In the event a member of a Policy Committee fails to attend (2) consecutive meetings of its respective Policy Committee, the member shall receive written notice of such absences and be informed that a third consecutive absence may result in his or her removal from the Policy Committee by the SCAG President. A copy of the written notice shall also be provided to the member s subregional organization, if applicable. If a third consecutive meeting is missed by a Policy Committee member, the Office of Regional Council Support shall notify the SCG President, who shall have the discretion to remove the member from the Policy Committee. Written notice of any such removal shall be provided to the Policy Committee member. Per Diem and Travel Expenses: $120 per diem for meetings. More information is available on www.scag.ca.gov. Fiscal Analysis: There is no impact to CVAG s General Fund. :attachment

Item 7C Coachella Valley Association of Governments Energy and Environmental Resources Committee March 10, 2011 Staff Report Subject: Contact: Request for Proposal for Regional PM-10 Street Sweeping Program Aurora Wilson, Director, Community Resources (awilson@cvag.org) Recommendation: 1) Authorize staff to prepare and issue a Request for Proposal (RFP) for operations of the Regional PM10 Street Sweeping Program; 2) Authorize the Executive Director to enter into negotiations with the recommended operator. Background: The current contract with Cleanstreet, the operator of the Regional PM-10 Street Sweeping Program, expires on June 30 th. CleanStreet has been the operator of the Regional Program since April 2004. A Request for Proposals (RFP) was issued in April 2007 and CleanStreet was awarded the contract. However, due to the scrutiny this program has received in the past, staff recommends that the RFP process be applied in order to maintain the integrity of this unique air quality program. Similar to the 2007 RFP, federal funds will not be used in the design of the RFP as the funding source for operations of the program. Funds from the Regional AB2766 Program will be used. Along with its current Regional AB2766 program, CVAG will also apply to the Mobile Source Review Committee s (MSRC) Local Government Match Program (applications to be released on March 4 th ) which would provide additional AB2766 funds for the Program. CVAG will seek a contractor to provide street sweeping services for up to three years. The revised schedule of sweeping every other week will be a change to the RFP. Also, while there is CVAG owned-equipment to operate the program, it is beyond its life expectancy. Interested applicants will be asked to use their own equipment and/or address how CVAG equipment can be used. Nick Nickerson with NAI Associates, who is currently contracted with CVAG, will assist staff on preparation and distribution of the RFP. The RFP will involve an aggressive schedule with its release on Friday, April 1 st and submittal deadline of Friday, April 22 nd. Advertisements will be placed in newspapers and staff will also employ a vendor list. Staff will work towards submitting a recommendation for the May 12th Energy and Environmental Resources Committee meeting. Fiscal Analysis: There is no impact to CVAG s General Fund. AB2766 funds will be used as the major funding source for operations of the Regional Program.

ITEM 7D Coachella Valley Association of Governments Energy and Environmental Resources Committee March 10, 2011 Staff Report Subject: 2011 Coachella Valley Energy Summit May 12 and May 13, 2011 Contact: Katie Barrows, Director of Environmental Resources (kbarrows@cvag.org) RECOMMENDATION: Participate in 2011 Energy Summit on Thursday, May 12 and Friday, May 13, 2011 BACKGROUND: CVAG and the Coachella Valley Economic Partnership (CVEP) have agreed to collaborate on a 2011 Coachella Valley Energy Summit on Thursday, May 12, and Friday, May 13. On Thursday, May 12 an Energy Summit will be held at Palm Springs Convention Center to bring together local, regional, and national leaders in government, energy, and the private sector to explore and discuss how our region can advance energy efficiency, renewable energy, greenhouse gas reduction, and green job growth in the Coachella Valley and beyond. There will be several panels focused on the latest trends in energy efficiency, renewable energy resources in the Coachella Valley, and how to foster economic development in the clean and green technology arena. On Friday, May 13, CVEP will host a business development tour to highlight renewable energy and other clean technology opportunities in the Coachella Valley region. We have established a program committee including CVAG and CVEP, Imperial Irrigation District (IID), Southern California Edison, and Southern California Gas Company that is working on the program and speakers. A flyer about the Energy Summit is attached for your information. One focus for the Energy Summit will be leadership in energy and sustainability by Coachella Valley communities and progress made since the 2009 Energy Summit. During the Thursday May 12 Summit, there will be an opportunity to highlight the progress made by our local jurisdictions since the Sustainability Pledge was signed by valley leaders in 2009. We would like to have the mayor or other representative of each jurisdiction present for a morning panel discussion highlighting your energy, green jobs and sustainability accomplishments. We would also like to list each jurisdiction as a member of the advisory committee. CVAG staff will be coordinating with you and your staff to confirm your availability and participation. The Energy Summit will be supported in part by sponsorships. Southern California Edison has committed a $10,000 sponsorship and sponsorships from Southern California Gas Company and IID are in the works. Sponsorship opportunities are also described in the attached flyer. BurkeRix Communications will serve as event manager and will handle registration, logistics, contracts with the convention center and all event coordination. FISCAL ANALYSIS: The 2011 Energy Summit will be funded through sponsorships and ticket sales for the two-day event.

SavetheDateforthe3 rd Annual May12 13,2011 EnergySummit May12,2011 PalmSpringsConventionCenter KeynoteSpeakers EdBegley,Jr. ActorandEnvironmentalist & GeneRodrigues DirectorofEnergyEfficiency SouthernCaliforniaEdison 8 9am~Registration 9am 2:30pm~Program BusinessExpo&BusTour May13,2011 LocationTBD 8 10am~Breakfast&Expo 10am 1pm~BusTourw/BoxLunch Formoreinformationandsponsorshipopportunities PleaseContact BurkeRixCommunications (760)327 9708x24

ENERGY CLIMATE SUSTAINABILITY GREEN JOBS MAY 12 13, 2011 SPONSOR PROSPECTUS The Coachella Valley Energy Summit on May 12-13th 2011 will feature three events comprised of regional leaders in government, energy, and the private sector focused on the advancement of energy efficiency, sustainability and green job growth in the Coachella Valley. The dates of the three events are as follows: Energy Summit: May 12th 8am to 2:30pm Networking Reception: May 12th 5:30pm to 7pm Business Opportunity Conference & Bus Tour: May 13th 8am to 1pm SPONSORSHIP LEVELS Platinum Sustainability Sponsor - $10,000 Name recognition and promotion as a Platinum Sponsor for the 2011 Energy Summit. Includes your name and logo on event Website and in all promotional material, including event notifications, advertisements, and event program Opportunity to introduce speaker at May 12th Energy Summit Complimentary reserved table of ten (includes 10 entry passes) at May 12th Energy Summit Complimentary Exhibitor booth space at May 12th Energy Summit 6 Complimentary tickets to the Networking Reception on May 12th 4 Complimentary passes to the Business Opportunity Conference & Bus Tour on May 13th Your name and logo on Sponsor signage at entry for all three events Gold Conservation Sponsor - $5,000 Name Recognition and promotion as a Gold Sponsor for the 2011 Energy Summit. Includes your name and logo on event Website and in all promotional material, including event notifications, advertisements, and event program Complimentary entry for six (6) at May 12th Energy Summit Complimentary Exhibitor booth space at May 12th Energy Summit 4 Complimentary tickets to the Networking Reception on May 12th 2 Passes to the Business Opportunity Conference & Bus Tour on May 13th Your name and logo on Sponsor signage at entry for all three events Silver Renewable Energy Sponsor - $2,500 Name Recognition and promotion as a Silver Sponsor for the 2011 Energy Summit. Includes your name on event Website, event notifications and event program Complimentary entry for four (4) at May 12th Energy Summit Complimentary Exhibitor booth space at May 12th Energy Summit 2 Complimentary tickets to the Networking Reception on May 12th 2 Passes to the Business Opportunity Conference & Bus Tour on May 13th Your name and logo on Sponsor signage at entry for all three events Your logo on event Website Bronze Energy Efficiency Sponsor - $1,000 Name Recognition and promotion as a Bronze Sponsor for the 2011 Energy Summit. Includes your name on event Website and event program Complimentary entry for two (2) at May 12th Energy Summit Complimentary Exhibitor booth space at May 12th Energy Summit Your name on Sponsor signage at entry for all three events Exhibitor - $500 Includes one clothed six foot table at May 12 Energy Summit event Lunch for two at May 12 Energy Summit event Electrical power if necessary is included For more information, please call: 760-327-9708 x24 Coachella Valley Energy Summit Steering Committee Wesley Ahlgren Coachella Valley Economic Partnership Chief Operating Officer Katie Barrows Coachella Valley Association of Governments Director of Environmental Resources Kathy DeRosa Mayor, Cathedral City Southern California Edison Deborah McGarrey Southern California Gas Company Public Affairs Manager Patrick Swarthout Imperial Irrigation District Governmental Affairs Officer Brian Rix Burke Rix Communications Senior Partner

ITEM 7F Coachella Valley Association of Governments Energy and Environmental Resources Committee March 10, 2011 Staff Report Subject: Contact: Support for Energy Efficiency Funding for Southern California Gas Company Katie Barrows, Director of Environmental Resources (kbarrows@cvag.org) RECOMMENDATION: Authorize a letter Opposing Transfer of Energy Efficiency Funds from Southern California Gas Company to the State General Fund BACKGROUND: As part of the state budget process, a proposal has been made to transfer the funds used for Southern California Gas Company Energy Efficiency programs to the state general fund. These funds are collected through a natural gas consumption surcharge on natural gas customers and are used for energy efficiency programs, rebates, and incentives. Southern California Gas Company has requested contact with state legislators, particularly budget conferees, opposing the transfer of these funds from Energy Efficiency programs. Southern California Gas Company is a partner with CVAG in the Desert Cities Energy Partnership. The benefits of the Energy Efficiency (EE) funds to the CVAG area include: The Energy Efficiency program funds all residential and commercial rebates available to ratepayers from Southern California Gas Company The EE funding provides support to Coachella Valley natural gas ratepayers to reduce their energy bills through energy efficiency, Natural Gas EE kits, presence of SCG staff at events promoting energy efficiency, and SCG support of cities to reduce natural gas consumption and reach out to residents/businesses The EE Surcharge Fund is the source of all the funding that supports SCG s participation in the Desert Cities Energy Partnership For example, the City of Indian Wells installed 90 tankless water heaters in their low income housing project. The rebates for these water heaters and the support from SCG staff to make this program work were supported by EE funds Energy efficiency is the most cost effective way to reduce ratepayer energy bills. Energy efficiency produces green jobs for contractors who install energy efficient water heaters, commercial boilers and insulation, etc., for retailers who sell energy efficient appliances, etc. A draft letter expressing support for Southern California Gas Company s Energy Efficiency programs and opposition to the transfer of funds collected specifically for these programs is attached. There is some potential that the state budget process will consider transfer of energy efficiency funds from the electric utilities and other sources. Staff recommends your support for a letter or other communication in support of continued Energy Efficiency funding for Southern California Gas Company. FISCAL ANALYSIS: Information only.

Mitch Mitchell Vice President State Government Affairs 925 L Street, Suite 650 Sacramento, CA 95814 (916) 492-4245 emitchell@semprautilities.com Issue: Transfer of Energy Efficiency Gas Surcharge Funds to the General Fund, Budget Item No. 8660 Recommendation: goals. Reject proposed transfer because it is illegal; eliminates green jobs; and impedes the State s environmental The Legislature should reject this proposal for all of the following reasons: Illegal: This proposal is illegal, violates the specific purpose of accumulating the funds, and violates Proposition 26, as it amounts to a new tax on gas consumers, requiring a 2/3 vote to approve. A 2/3 vote for a new tax on gas consumers has not yet occurred. - AB 1002 (Wright, 2000) established the Gas Consumption Surcharge Fund as a substitute for collecting moneys through CPUCapproved rates in order to prevent bypass of public purpose programs by interstate utilities. By its terms, the law was not creating a new charge, but only changing the way gas energy efficiency funding was collected. The funds are specifically earmarked only for use by utilities in specific programs. - The State cannot use these funds for any other purpose without amending the Public Utilities Code to allow for those other uses. Legislative attempts to do so are an improper transfer of special funds and interfere with the objectives for which these Surcharge Funds were created. - Any effort to use the funds for another purpose or to amend the code to change the use of these funds constitutes a new tax on all affected gas customers. Proposition 26 requires that any such action is only permitted on 2/3 vote of the legislature. Eliminates Green Jobs: This action would cause the loss of thousands of green jobs in the State. - The energy efficiency programs are examples of effective green jobs programs. According to a 2008 University of California, Berkeley study, The economic benefits of energy efficiency innovation have a compounding effect. The first 1.4 percent of annual efficiency gain produced about 181,000 additional jobs, while an additional one percent yielded 222,000 more. - Currently, the legislature is pursuing programs to train people for green jobs (SBx1 1 (Steinberg)). This proposal is inconsistent in that it proposes to eliminate existing green jobs, and minimize the potential for new green jobs created by energy efficiency. Impedes Attainment of California s Environmental Goals: In the absence of natural gas energy efficiency programs (except for lowincome programs CARE and ESAP), emissions from natural gas use will increase. - Energy efficiency is the most cost-effective means of attaining AB 32 GHG reductions in greenhouse gases and criteria pollutants. Over the last 5 years (2006-2010), SoCalGas programs have helped customers cumulatively save over 122 million therms ~ enough to supply energy to 244,000 homes for one year. The program expenses during that period were $217 million. Over the last 5 years (2006-2010), SDG&E programs have helped customers cumulatively save 15.4 million therms ~ enough to supply energy to over 30,000 homes for one year. The program expenses during that period were $74 million. - The elimination of natural gas energy efficiency programs will result in higher GHG criteria emissions, as new population is added without corresponding energy efficiency measures. This will significantly reduce the State s ability to meet Clean Air Act requirements as well as its own greenhouse gas target reductions under AB 32. - Legislative action to take these funds would end natural gas energy efficiency in California (except low-income programs CARE and ESAP). The sole source of funding for all gas energy efficiency programs is the Gas Consumption Surcharge. 2/22/2011

March 28, 2011 Senator Darrell Steinberg Senate President pro Tem State Capitol, Room 205 Sacramento, CA 95814 Dear Senator Steinberg: The intent of this correspondence is to express our opposition to the proposed transfer of money from the Energy Efficiency Gas Surcharge Fund to the General Fund to address the state s budget deficit. The money in the Gas Surcharge Fund was collected for the specific purpose of supporting programs to promote energy efficiency to benefit residential and business customers. Over the past five years the programs offered through Southern California Gas Company have helped customers save approximately 122 million therms, which is enough savings to provide energy for 244,000 homes for one year. The programs funded by the surcharge have benefited residential customers and a variety of large and small businesses in the Coachella Valley, and throughout central and southern California. The Coachella Valley Association of Governments is a partner with Southern California Gas Company in the Desert Cities Energy Partnership. The Energy Efficiency funding helps Coachella Valley natural gas ratepayers to reduce their energy bills through energy efficiency measures, rebates, and incentives. It also helps our member jurisdictions reach their energy efficiency and greenhouse gas reduction goals. The demand for energy efficiency programs is growing as consumers realize the opportunities for cost savings, energy savings, and reduction in greenhouse gas emissions. The cost savings and therm savings are great evidence of the utilities efforts to promote customer participation in efforts to reduce emissions and achieve the goals set by AB 32. We strongly urge you to reject this proposal because the Gas Surcharge Fund is the sole source of funding for the existing energy efficiency programs. Energy efficiency produces green jobs for contractors who install energy efficient water heaters, commercial boilers and insulation and for retailers who sell energy efficient appliances and other items. If this money is shifted to the general fund it could result in loss of jobs affiliated with these energy efficiency programs. Without an active program for natural gas customers, the cost savings, jobs, and air quality/emissions benefits of Energy Efficiency will not be realized. Again we urge you to reject this proposal and allow us to continue working to make California more energy efficient. Thank you for your consideration of this request. Sincerely, Yvonne Parks Chair

Item 7G Coachella Valley Association of Governments Energy and Environmental Resources Committee March 10, 2011 Staff Report Subject: Contact: Energy and Water Conservation Subcommittee Katie Barrows, Director of Environmental Resources (kbarrows@cvag.org) RECOMMENDATION: Discuss Discontinuation of Energy and Water Conservation Subcommittee BACKGROUND: The first meeting of the Energy Conservation Subcommittee was held on February 1, 2007. Following initial discussions of the need for a subcommittee to identify, initiate and support energy conservation initiatives within the CVAG area, the CVAG Executive Committee officially established the Energy Conservation Subcommittee in March 2007. The goal of the subcommittee was to foster a long-term cultural change toward improved energy conservation and enhanced energy efficiency. The membership of the subcommittee included representatives of the jurisdictions, including elected officials and staff, as well as electric and gas utilities, water districts, building industry, and five members at large appointed by the CVAG Executive Committee. The Energy Conservation Subcommittee was later renamed the Energy and Water Conservation Subcommittee. The Subcommittee developed the first Energy Action Plan, held the first Energy Conservation Fair in April 2007, and developed the CVAG Resolution on Energy and Sustainability. The Subcommittee was also active in the first Energy Summit in 2008. During 2008, the Subcommittee worked to establish an energy partnership with our electric and gas utilities. In 2009, the Desert Cities Energy Partnership was formed bringing together CVAG, Southern California Edison, Southern California Gas Company, and Imperial Irrigation District in a partnership with CVAG member agencies to promote leadership in energy efficiency. With formation of the Desert Cities Energy Partnership (DCEP) and establishment of a Partnership Working Group including staff representatives of CVAG member jurisdictions, SCE, SCG, and IID, the Subcommittee determined that its major goals had been reached. The last meeting of the Subcommittee was held on January 21, 2010. At that meeting, the Subcommittee members agreed that the most effective way to move forward was through the DCEP Working Group. Though no formal action was taken, the consensus was that the Subcommittee could either continue to be available on an as needed basis, or be discontinued. At the January 2011 meeting, the Energy and Environmental Resources Committee requested that the issue be brought back for your consideration. The Committee members could recommend that the Energy and Water Conservation Subcommittee be discontinued by the Executive Committee. Or, the Committee could make an alternative recommendation. FISCAL ANALYSIS: Information only.