BILL ANALYSIS
AB 80
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 80 (Havice)
As Amended August 26, 2002
Majority vote
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|ASSEMBLY: | |(June 5, 2002) |SENATE: |26-2 |(August 28, |
| | | | | |2002) |
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(vote not relevant)
Original Committee Reference: E. S. & T. M.
SUMMARY : Authorizes the cities participating in the Magnolia
Power Project to aggregate their electricity loads and provide
direct electricity access to their residents.
The Senate amendments delete the Assembly version of this bill,
and instead:
1)Authorize the cities participating in the Magnolia Power
Project to act as community aggregators and provide direct
access service to their residents.
2)Require the California Public Utilities Commission (PUC) to
develop a cost recovery mechanism for DWR's uncollected costs,
including financing, of providing service to those customers
who subsequently receive service from the cities of San Marcos
and Cerritos.
EXISTING LAW :
1)Authorizes retail competition within investor-owned utility
(IOU) service areas (direct access) and authorizes marketers,
public agencies, cities, counties, and special districts to
offer electric service to customers aggregated on a voluntary
basis, provided that each customer in their jurisdiction
agrees to participate by a positive written declaration
(community aggregation).
2)Requires the PUC to suspend the right of retail customers of
IOUs to acquire electric power service from non-IOU providers
until the Department of Water Resources (DWR) no longer
supplies power to IOU customers.
AB 80
Page 2
AS PASSED BY THE ASSEMBLY , this bill directed school districts
to require district level maintenance supervisors to participate
in training by the Department of Health Services through its
California Lead-Safe Schools Project.
FISCAL EFFECT : Unknown
COMMENTS : Law enacted last year [AB 1X (Keeley), Chapter 4,
Statutes of 2001] requires PUC to suspend the right of retail
customers of IOUs to acquire electric power service from non-IOU
providers until DWR no longer supplies power to IOU customers.
Pursuant to AB 1X, the PUC suspended direct access effective
September 20, 2001.
This bill authorizes the cities participating in the Magnolia
Power Project to act as community aggregators and provide direct
access service to their residents. The two cities are San
Marcos and Cerritos and most of the residents currently receive
their electricity from Southern California Edison. The bill
requires the PUC to develop a cost recovery mechanism for DWR's
uncollected costs, including financing, of providing service to
those customers who subsequently receive service from the cities
of San Marcos and Cerritos.
Community aggregation is a form of direct access by which a
municipality may act as a purchasing agent on behalf of its
residents.
Among other things, AB 1X permits the issuance of
ratepayer-backed revenue bonds to finance DWR purchasing costs.
To ensure the predictable revenue stream necessary for the
issuance of bonds and prevent cost shifting from direct access
to bundled service customers, the PUC was authorized to prevent
additional migration of IOU customers by suspending direct
access.
The cities affected by this bill (Cerritos and San Marcos) are
partners in the development of the Magnolia Power Project, along
with five other cities (Anaheim, Colton, Glendale, Burbank and
Pasadena) which operate municipal electric utilities. Magnolia
is currently under review at the California Energy Commission
(CEC). The CEC projects a decision on the project in August,
and, if approved, an on-line date of August 2004. According to
the author, Cerritos and San Marcos were relying on direct
AB 80
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access to sell their share of the output of Magnolia to their
residents and committed $5 million to Magnolia prior to the
CPUC's suspension of direct access. Proponents suggest the bill
will allow the cities to sell their share of the output of
Magnolia to their residents.
Analysis Prepared by : Paul Donahue / U. & C. / (916) 319-2083
FN:
0007672