Cal. Pub. Res. Code § 26401

(a) Within the Energy and Resources Fund there is hereby created the Energy Account and the Resources Account. The annual budget document shall propose and the annual Budget Bill shall allocate and divide the money in the fund between such accounts.
(b) It is the intent of the Legislature that funds from the Energy and Resources Fund be used only for short-term projects and not for any ongoing programs.
(c) Moneys in the Energy Account may be appropriated by the Legislature solely for energy projects and programs deemed appropriate by the Legislature.
(d) All appropriations from the Energy Account or the Resources Account shall be made by the annual Budget Bill.
(e) In applying the provisions of this section to the selection of individual energy programs and projects for funding, priority shall be given to those programs and projects which best fulfill all of the following criteria:
1. (1) Have the greatest potential for reducing the use of oil and natural gas to produce energy.
2. (2) Have the greatest potential for transferability and widespread use throughout the state by the year 1990.
3. (3) Have the highest degree of feasibility.