Key Points

• California continues to lead the world in the promotion of renewable energy technology and efforts to reduce carbon emissions in order to curb global warming.
• Governor Newsom recently signed SB-149, which streamlines CEQA litigation for certain certified infrastructure projects, including new energy storage systems.
• SB-149 is just one element of the State’s Clean Energy Transition Plan, which seeks to advance renewable energy systems, including battery storage, in order to meet the 2045 goal of 100% clean electricity.

---

Infrastructure Streamlining Package

On July 10, 2023, Governor Newsom signed an infrastructure streamlining package promising to accelerate critical infrastructure projects and help California achieve its world-leading climate and clean energy goals. The infrastructure package involves a suite of bills focused on maximizing $180 billion in federal and state funding for infrastructure projects, incentivizing construction, protecting the environment, providing safe drinking water, and accelerating clean energy projects. Upon signing the package, Newsom announced that “California is saying ‘yes’ to building the clean energy … projects we need to deliver on our world-leading climate action.”

SB 149

Included in this package is SB 149, which provides that certain certified energy infrastructure projects are entitled to streamlining under the California Environmental Quality Act (“CEQA”). The Governor’s office touts this legislation as a significant move to expedite and incentivize clean energy projects. The law helps achieve streamlining by setting litigation timelines and requiring preparation of the CEQA administrative record concurrently with environmental review. SB 149 was shepherded as urgency legislation and took effect immediately.

SB 149 amends CEQA to create streamlining provisions for certified infrastructure projects. Infrastructure projects are defined as energy infrastructure projects, semiconductor or microelectronic project, transportation-related projects, or water-related projects that meet certain specified criteria.

Energy infrastructure projects are defined to include new energy storage systems of 20 megawatts or more, that are capable of discharging for at least two hours and receive a capital investment of at least two hundred fifty million dollars ($250,000,000).

A project may be certified as energy infrastructure project if specific criteria are met, including:

• The project applicant agrees to pay the costs of litigation in any case challenging a lead agency’s action under CEQA;
• The project applicant agrees to pay the cost of preparing the administrative record of proceedings concurrently with CEQA review; and
• The project does not result in any net additional emission of greenhouse gases.

Projects that meet these criteria, are entitled to provisions that streamline (a) the CEQA administrative record of proceedings, and (b) the timeline for judicial review. These provisions are designed address bottlenecks in existing CEQA procedures that render CEQA litigation both time consuming and expensive.

A. Preparation and Certification of the Record of Proceedings

SB 149 provides for the following provisions for infrastructure projects:

• The lead agency must prepare the administrative record of proceedings concurrently with the administrative process.
• The contents of the administrative record of proceedings, CEQA documents, and public comments must be made publicly available on the agency’s website.
• The lead agency must certify the final record of proceedings within five days of the project’s approval.
• The applicant must pay for the lead agency’s cost to prepare the administrative record, and these costs are not recoverable from the plaintiff.

These provision are designed to save time and expense for projects that are challenged in court.

B. Timeline for Judicial Review

SB 149 also provides that any action to challenge an environmental impact report for an infrastructure project, including any appeal to the court of appeal or review by the Supreme Court must be resolved within 270 days, to the extent feasible.

How This Bill Fits Within the State’s Renewable Energy Goals

This measure follows several efforts by Governor Newsom and the State Legislature to meet the State’s renewable energy goals by increasing statewide battery storage.

• In 2018, SB 100 set the target of requiring renewable energy and zero-carbon resources for 100 percent of electric retail sales to end-use customers by 2045.
• On July 30, 2021, Governor Newsom issued a Proclamation of State of Emergency in California to address a sudden and severe energy supply shortfall from extreme drought, wildfires, and record-breaking heat events, which put significant demand and strain on California's energy grid. To increase the State’s energy capacity the Governor ordered the CEC to expedite the process to approve licenses for new and expansions of battery storage systems. In response, the CEC established an expedited process to approve new and expanded systems 20 megawatts or more that the CEC determines are capable of discharging for at least two hours and would deliver net peak energy by October 31, 2022.
• AB 205 further expanded the CEC siting authority and CEC established a siting certification process for energy storage facilities capable of storing at least 200 megawatts of energy. Ultimately, however, no battery storage systems have benefited from the expedited permit process.
• On August 29, 2022, SB 2625 addressed another roadblock and removed the requirement to subdivide parcels of land before they are leased or sold for an electrical energy storage system on the land.
• SB 149 is one element of Governor Newsom’s larger “Clean Energy Transition Plan,” released in May 2023. The Plan delineates how the State intends to reach a 100 percent clean electric future, and address reliability challenges of extreme weather events caused by climate change, and equitably deliver a clean, safe, reliable, and affordable energy transition. Expansion of battery storage capacity is critical in this effort.
• Meanwhile, the California Public Utilities Commission (“CPUC”) has set clean energy procurement requirements in order to ensure electricity reliability in the state and meet clean energy goals. In June 2021, the CPUC ordered utilities to procure 11,500 megawatts of net qualifying capacity. On February 23, 2023, the CPUC ordered an addition 4,000 megawatts of new electricity from distributed energy resources (including energy efficiency and demand response), renewables, and zero-emitting sources.

This most recent legislative package is just one step in the State’s march towards its goal of 100% electricity from clean and renewable sources. As the State continues to experience extreme weather events, grid reliability is an increasingly important priority. Given these goals and priorities, and the State’s dedication to leading the rest of the world on climate change adaptation and mitigation, we can expect to see additional incentives and streamlining for battery storage in the future.

If you have any questions about how these developments will affect your project or any other land use issue you are facing, please contact the authors or the Hanson Bridgett Land Use Practice Group.