BILL NUMBER: AB 1233 AMENDED
BILL TEXT
AMENDED IN SENATE AUGUST 27, 2001
AMENDED IN SENATE JUNE 11, 2001
AMENDED IN ASSEMBLY APRIL 26, 2001
AMENDED IN ASSEMBLY APRIL 19, 2001
INTRODUCED BY Assembly Member Pescetti
FEBRUARY 23, 2001
An act to add Section 785.8 785.2 to
the Public Utilities Code, relating to public utilities.
LEGISLATIVE COUNSEL'S DIGEST
AB 1233, as amended, Pescetti. Public utilities: transportation
charges.
(1) Existing law authorizes the Public Utilities Commission
to establish rates for public utilities, including gas corporations.
Under existing law, the commission requires every gas corporation to
revise its transportation tariffs and conditions of service to
eliminate all components that assess shippers of gas produced in the
state for the costs of interstate transmission of gas produced
outside the state. Existing law requires the Public Utilities
Commission to allow a gas corporation to fully recover all reasonable
and prudent costs associated with ownership and operation of the gas
plant used for transportation.
This bill would prohibit assessment of local transmission rates on
natural gas if (a) it is delivered to an end-use customer, (b) it is
delivered through a transmission system owned by another entity that
is not interconnected with a utility's local transmission system,
and (c) it is blended with gas supplies produced from an in-state
source for the purposes of achieving a usable thermal rate. The bill
would require the commission to administer this provision in a
manner that prohibits any cost shift to core customers resulting from
the rate exemption required under the bill. Because a violation of
the Public Utilities Act is a crime under existing provisions of
law, this bill would create a state-mandated local program by
expanding the definition of a crime.
This bill would require the commission to investigate, as part of
the rate proceeding for any gas corporation, impediments to the
in-state production and storage of natural gas. The bill would
prohibit the commission, as specified, from adopting a tariff that
has the effect of discouraging in-state production or storage of
natural gas. The bill would authorize the commission to adopt a
tariff that encourages in-state production or storage of natural gas,
including reducing local transmission rates applicable to in-state
gas blends, unless the commission finds that adopting the tariff will
likely result in consequences adverse to the interests of gas
customers. Since a violation of an order by the commission is a
crime under existing provisions of law, the bill would create a
state-mandated local program by expanding the definition of a crime.
(2) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. The Legislature finds and declares all of the
following:
(a) California is one of the largest producers of oil and natural
gas in the nation.
(b) California is one of the largest consumers of oil and natural
gas in the nation.
(c) Natural gas is a crucial commodity that is necessary
to electrical for electricity production,
residential heating, commodity production, and industrial
manufacturing.
(d) The price of electricity is tied closely to the price of
natural gas.
(e) Despite having significant untapped reserves of natural gas,
California remains heavily dependent upon out-of-state gas
deliveries.
(f) It is in the state's long-term economic interest to promote
policies that maximize the use of available in-state resources and
encourage the increased production of natural gas.
(g) It is also in the state's long-term economic interest to
maximize the development of renewable energy sources, decrease its
overall dependence on natural gas, and create a more diverse mix of
energy supplies and energy efficiency measures.
SEC. 2. Section 785.8 785.2 is added
to the Public Utilities Code, to read:
785.8. (a) Natural gas may not be assessed local transmission
rates if all of the following conditions apply:
(1) The gas is delivered to an end-use customer.
(2) The gas is delivered through a transmission system owned by
another entity that does not interconnect with a utility's local
transmission system.
(3) The gas is blended with gas supplies produced from an in-state
source for the purposes of achieving a usable thermal rate.
(b) The commission shall administer this section in a manner that
prohibits any cost shift to core customers resulting from the rate
exemption required under subdivision (a).
785.2. The commission shall investigate, as part of the rate
proceeding for any gas corporation, impediments to the in-state
production and storage of natural gas. To the extent practicable and
consistent with Sections 785 and 785.5, the commission may not adopt
a tariff that has the effect of discouraging in-state production or
storage of natural gas. The commission may adopt a tariff that
encourages in-state production or storage of natural gas, including,
but not limited to, reducing local transmission rates applicable to
in-state gas blends, unless the commission finds that adopting the
tariff will likely result in consequences adverse to the interests of
gas customers.
SEC. 3. No reimbursement is required by this act pursuant to
Section 6 of Article XIIIB of the California Constitution because the
only costs that may be incurred by a local agency or school district
will be incurred because this act creates a new crime or infraction,
eliminates a crime or infraction, or changes the penalty for a crime
or infraction, within the meaning of Section 17556 of the Government
Code, or changes the definition of a crime within the meaning of
Section 6 of Article XIIIB of the California Constitution.