The Legislature finds and declares that Chapter 854 of the Statutes of 1996 restructured
the California electricity industry and created a competitive electricity generation
market. In a competitive generation market, the recovery by powerplant owners of their private
investment and operating costs is at risk and no longer guaranteed through regulated
rates. Before the California electricity industry was restructured, the regulated cost
recovery framework for powerplants justified requiring the commission to determine
the need for new generation, and site only powerplants for which need was established. Now that powerplant owners are at risk to recover their investments, it is no longer
appropriate to make this determination. It is necessary that California both protect environmental quality and site new
powerplants to ensure electricity reliability, improve the environmental performance
of the current electricity industry and reduce consumer costs. The success of California's restructured electricity industry depends upon the willingness
of private capital to invest in new powerplants. Therefore, it is necessary to modify the need for determination requirements of
the state's powerplant siting and licensing process to reflect the economics of the
restructured electricity industry and ensure the timely construction of new electricity
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