1618(cc) Rulemaking for Renewable Energy Requirements

Background

Pursuant to Police Code, Article 16, Section 1618(cc), Every Cannabis Business shall ensure that the electrical power used for Commercial Cannabis Activities shall be procured from or produced by Greenhouse Gas Free and/or renewable sources, consistent with Renewable Energy Requirements to be adopted by the Director, in consultation with the Director of the Department of the Environment. In adopting Renewable Energy Requirements, the Director shall establish minimum renewable energy requirements that are consistent with the amount of renewable energy contained in CleanPowerSF's Green Service or are consistent with the zero Greenhouse Gas profile of a hydroelectric power supply. A Cannabis Business shall also provide to the Director and the Department of the Environment an annual report documenting the amount and source of energy consumed by the Business in the prior 12 months.

The following Renewable Energy Requirements and Implementation Rules are being proposed:

Definitions

The “Power Content Label” is used annually by Utilities and Community Choice Aggregators to demonstrate compliance with California’s Renewable Portfolio standard to the California Energy Commission.

The “Data Quality Checker” is a part of the ENERGY STAR portfolio manager, and serves as an electronic tool designed to check for errors. 

Rules

1. Commercial Cannabis Businesses are required to ensure that the electrical power used for Commercial Cannabis activities are procured from sources that meet the City’s minimum requirements for renewable energy.
2. This requirement may be met through one or any combination of the following:
   • Participation in the San Francisco Public Utilities Commission (SFPUC) CleanPowerSF’s “Green” Service, or procurement from electricity suppliers that provide at least equivalent renewable energy, as determined by the Power Content Label reported to the California Energy Commission for the most recent available year;
     • Operators will be allowed to satisfy this requirement by participating in CleanPowerSF’s “Green” Service.
     • Operators are encouraged to participate in CleanPowerSF's " Super Green" Service four years after permit issurance or anytime to satisfy this requirement;
     • Instructions on how to local CleanPowerSF can be found here.
   • Participation in the SFPUC’s Hetch Hetchy hydroelectric power supply;
   • Onsite renewable energy generation;
3. To comply with the requirements outlined in Article 16, San Francisco Commercial Cannabis Businesses shall annually submit an Annual Benchmark Summary to the Department of Environment using the US Environmental Protection Agency’s ENERGY STAR Portfolio Manager.
   • Collect and enter energy usage data in the ENERGY STAR Portfolio Manager on a monthly basis, and
   • Verify information by running the Portfolio Manager ‘Data Quality Checker’ or an equivalent approved by the Director of the Environment, and
   • Report the facility’s energy use through ENERGY STAR Portfolio Manager utilizing a reporting hyperlink provided by the Department on the Environment.
4. No later than March 1, annually, Commercial Cannabis Businesses are required to submit to the Department of Environment
   • An Annual Statement of Sources of Electricity, which shall include, but may not be limited to:
     • identification of the electricity provider,
     • type of product procured, and
     • a description of onsite renewable energy generation
5. An Annual Energy Benchmark Summary
   • This report must be generated and submitted through ENERGY STAR Portfolio Manager utilizing the 2021, 2022, and 2023 reporting hyperlinks provided by the Department of the Environment. A step-by-step guide to getting started on Benchmarking can be found here.

Waiver Request

1. Commercial buildings 10,000 square feet or larger, and residential mixed-use buildings 50,000 square feet or larger, are separately required by SF Environment Code Chapter 20 to benchmark the entire building annually. Commercial Cannabis Businesses located in such buildings may apply for a waiver. 
2. Commercial Cannabis Businesses that do not have direct access to and/or do not exercise control over the energy account (i.e. utility is included in monthly rent), may request a waiver to the renewable energy requirements. Such requests shall include, but are not limited to, one of the following supporting documents:
   • A signed lease agreement or an addendum to lease agreement that indicates utility is included in monthly rent, or;
   • A statement from the landlord confirming that utility is included in monthly rent. 
3. For waiver requests that are not covered under the section 6 of this regulation. The Director, in consultation with the Director of the Department of Environment or their designee, may waive such penalties on a case by case basis if the Commercial Cannabis Business demonstrates to the Director’s satisfaction that compliance with this rule is not possible. 
   • A Commercial Cannabis Business wishing to request a waiver is responsible for filing in writing a request to the Office of Cannabis and this request shall include the reason for which the business is unable to meet the requirements set forth in this rule.
   • The Office of Cannabis, in consultation with the Department on the Environment, shall review the Commercial Cannabis Business’ request for a waiver and notify the Commercial Cannabis Business if the waiver is approved or denied.
4. Such request should be submitted to the Office of Cannabis via email at officeofcannabis@sfgov.org, with a copy to the Department of the Environment at existingbuildings@sfgov.org.

Compliance with Permit Conditions

Failure to annually demonstrate that the Commercial Cannabis Business is procuring the appropriate levels of renewable electricity, or to annually report total energy use as described above, is a violation of a permit condition as set forth in Police Code Sections 1612, 1615, and 1617, and other applicable laws.

Comment period start date

April 26, 2023

Comment period end date

May 10, 2023