BILL NUMBER: SBX1 43 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 4, 2001
AMENDED IN SENATE MARCH 7, 2001
AMENDED IN SENATE MARCH 1, 2001
INTRODUCED BY Senators Alpert, Battin, Morrow, and Peace
(Coauthors: Assembly Members Bates, Kehoe, La Suer, Vargas, Wayne,
Wyland, and Zettel)
FEBRUARY 9, 2001
An act to amend Section 332.1 of , and to add Section 332.2
to, the Public Utilities Code, and to amend Section
80134 of the Water Code, relating to electric power, and
declaring the urgency thereof, to take effect immediately.
LEGISLATIVE COUNSEL'S DIGEST
SB 43, as amended, Alpert. San Diego Gas and Electric
Company: rates: Department of Water Resources: revenues
Electric power .
(1) The Public Utilities Act requires the Public Utilities
Commission to establish a ceiling of $.065 per kilowatthour on the
energy component of electric bills for residential, small commercial,
and lighting customers of the San Diego Gas and Electric Company,
through December 31, 2002, retroactive to June 1, 2000, as
prescribed. The commission may extend the ceiling through December
2003, as specified. Existing law requires the commission to
determine that portion of each existing electrical corporation's
retail rate effective on January 5, 2001, that is equal to the
difference between the generation related component of the retail
rate and the sum of the costs of the utility's own generation,
qualifying facility contracts, existing bilateral contracts, and
ancillary services, to be known as the California Procurement
Adjustment. Existing law requires the commission to further
determine the amount of the California Procurement Adjustment that is
allocable to the power sold by the Department of Water Resources,
which is payable by each electrical corporation to the department for
deposit in the Department of Water Resources Electric Power Fund,
and known as the Fixed Department of Water Resources Set-Aside.
This bill would , instead, require the commission to
also establish a frozen rate ceiling of
$.065 $0.065 per kilowatthour on the
energy component of electric bills for all customers of the
San Diego Gas and Electric Company not subject to the ceiling imposed
by existing law, through December 31, 2002, retroactive to February
7, 2001. electricity supplied to residential, small
commercial, and street lighting customers by the San Diego Gas and
Electric Company, through December 31, 2002, retroactive to June 1,
2000. The bill would require the commission to also establish a
frozen rate of $0.065 per kilowatthour on the energy component of
electric bills for electricity supplied to all customers by the San
Diego Gas and Electric Company not subject to the ceiling imposed by
existing law, through December 31, 2002, retroactive to February 7,
2001. The bill would provide that a frozen rate established shall
not result in any retroactive recovery of undercollections by the San
Diego Gas and Electric Company. The bill would require
that any undercollection resulting from rate reductions retroactive
to February 7, 2001, not result in a revenue undercollection to San
Diego Gas and Electric Company. The bill would require the
commission to adjust the California Procurement Adjustment and the
Fixed Department of Water Resources Set-Aside for those customers, as
prescribed. The bill would make a related
statement statements about the
construction of the bill. Since a violation of a rule or order of
the commission is a crime, this bill would impose a state-mandated
local program by creating a new crime.
(2) Existing law requires the department to enter into
contracts for the purchase of electric power, and authorizes the
department to sell power to retail end use customers and, with
specified exceptions, to local publicly owned electric utilities at
not more than the department's acquisition costs, as specified.
Existing law authorizes the department to issue revenue bonds not to
exceed a certain amount, containing specified terms and conditions,
upon authorization by written determination of the department and
with the approval of the Director of Finance and the Treasurer, as
specified. Existing law requires the department to establish and
revise revenue requirements sufficient, together with any moneys on
deposit in the fund, to provide amounts necessary for specified
purposes relating to the provision of power and bond repayment, and
to notify the commission of its revenue requirement.
This bill would include among those revenue requirements to be
established an amount necessary to reimburse the department for any
undercollection of the department's acquisition costs, plus certain
other costs, pursuant to the rate requirements imposed by the bill.
(3) 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.
(4)
(3) This bill would declare that it is to take effect
immediately as an urgency statute.
Vote: 2/3. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 332.1 of the Public Utilities Code is
SECTION 1. Section 332.1 of the Public Utilities Code is amended
to read:
332.1. (a) (1) It is the intent of the Legislature to enact Item
1 (revised) on the commission's August 21, 2000 agenda, entitled
"Opinion Modifying Decision (D.) D.00-06-034 and D.00-08-021 to
Regarding Interim Rate Caps for San Diego Gas and Electric Company,"
as modified below.
(2) It is also the intent of the Legislature that to the extent
that the Federal Energy Regulatory Commission orders refunds to
electrical corporations pursuant to their findings, the commission
shall ensure that any refunds are returned to customers.
(b) The commission shall establish a ceiling of six and
five-tenth five-tenths cents ($.065)
($0.065) per kilowatt hour on the energy
component of electric bills for electricity supplied to
residential, small commercial, and street lighting customers
of by the San Diego Gas and Electric Company,
through December 31, 2002, retroactive to June 1, 2000. If the
commission finds it in the public interest, this ceiling may be
extended through December 2003 and may be adjusted as provided in
subdivision (d).
(c) The commission shall establish an accounting procedure to
track and recover reasonable and prudent costs of providing electric
energy to retail customers unrecovered through retail bills due to
the application of the ceiling provided for in subdivision (b). The
accounting procedure shall utilize revenues associated with sales of
energy from utility-owned or managed generation assets to offset an
undercollection, if undercollection occurs. The accounting procedure
shall be reviewed periodically by the commission, but not less
frequently than semiannually. The commission may utilize an existing
proceeding to perform the review. The accounting procedure and
review shall provide a reasonable opportunity for San Diego Gas and
Electric Company to recover its reasonable and prudent costs of
service over a reasonable period of time.
(d) If the commission determines that it is in the public interest
to do so, the commission, after the date of the completion of the
proceeding described in subdivision (g), may adjust the ceiling from
the level specified in subdivision (b), and may adjust the
frozen rate from the levels specified in subdivision (f),
consistent with the Legislature's intent to provide substantial
protections for customers of the San Diego Gas and Electric Company
and their interest in just and reasonable rates and adequate service.
(e) For purposes of this section, "small commercial customer"
includes, but is not limited to, all San Diego Gas and Electric
Company accounts on Rate Schedule A of the San Diego Gas and Electric
Company, all accounts of customers who are "general acute care
hospitals," as defined in Section 1250 of the Health and Safety Code,
all San Diego Gas and Electric Company accounts of customers who are
public or private schools for pupils in kindergarten or any of
grades 1 to 12, inclusive, and all accounts on Rate
Schedule AL-TOU under 100 kilowatts.
(f) The commission shall establish a program for large
commercial, agricultural, and industrial customers who buy energy
from the San Diego Gas and Electric Company, on a voluntary basis, at
the election of the customer, to set the energy component of their
bills at six and five-tenths cents ($.065) per kilowatt hour with a
true-up after a year an initial frozen rate of six and
five-tenths cents ($0.065) per kilowatthour on the energy component
of electric bills for electricity supplied to all customers by the
San Diego Gas and Electric Company not subject to subdivision (b),
for the time period ending with the end of the rate freeze for the
Pacific Gas and Electric Company and the Southern California Edison
Company pursuant to Section 368, retroactive to February 7, 2001.
The commission shall consider the comparable energy components of
rates for comparable customer classes served by the Pacific Gas and
Electric Company and the Southern California Edison Company and, if
it determines it to be in the public interest, the commission may
adjust this frozen rate, and may do so, retroactive to the date that
rate increases took effect for customers of Pacific Gas and Electric
Company and Southern California Edison Company pursuant to the
commission's March 27, 2001, decision. The commission shall adjust
the California Procurement Adjustment and the Fixed Department of
Water Resources Set-Aside determined pursuant to Section 360.5 for
customers subject to this section to reflect a retail rate consistent
with the rate for the energy component of electric bills as
determined in this subdivision, in place of the retail rate in effect
on January 5, 2001. This section shall be construed to modify the
payment provisions, but may not be construed to modify the electric
procurement obligations of the Department of Water Resources,
pursuant to any contract or agreement in accordance with Division 27
(commencing with Section 80000) of the Water Code, and in effect as
of February 7, 2001, between the Department of Water Resources and
San Diego Gas and Electric Company .
(g) The commission shall institute a proceeding to examine the
prudence and reasonableness of the San Diego Gas and Electric Company
in the procurement of wholesale energy on behalf of its customers,
for a period beginning at the latest on June 1, 2000. If the
commission finds that San Diego Gas and Electric Company acted
imprudently or unreasonably, the commission shall issue orders that
it determines to be appropriate affecting the retail rates of San
Diego Gas and Electric Company customers including, but not limited
to, refunds.
(h) Nothing in this section shall be construed to limit the
authority of the Department of Water Resources pursuant to Division
27 (commencing with Section 80000) of the Water Code, including
without limitation, the authority to fix and establish the procedure
and charges for the sale or other disposal of power purchased by the
department and sold to retail end-use customers and the authority to
recover its revenue requirements.
SEC. 2. Section 332.2 is added to the Public Utilities Code, to
read:
332.2. Rates set by the commission that are subject to
subdivision (f) of Section 332.1 shall not result in any retroactive
recovery of undercollections by the San Diego Gas and Electric
Company. Any undercollection resulting from the retroactive rate
reductions ordered pursuant to this chapter, retroactive to February
7, 2001, shall not result in a revenue undercollection to San Diego
Gas and Electric Company.
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.
SEC. 4. This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
In order to safeguard economic viability of the communities in the
San Diego region, it is necessary that this act take effect
immediately. amended to read:
332.1. (a) (1) It is the intent of the Legislature to enact Item
1 (revised) on the commission's August 21, 2000, agenda, entitled
"Opinion Modifying Decision (D.) D.00-06-034 and D.00-08-021 to
Regarding Interim Rate Caps for San Diego Gas and Electric Company,"
as modified below.
(2) It is also the intent of the Legislature that to the extent
that the Federal Energy Regulatory Commission orders refunds to
electrical corporations pursuant to their findings, the commission
shall ensure that any refunds are returned to customers.
(b) The commission shall establish a ceiling of six and
five-tenths cents ($.065) per kilowatthour on the energy component of
electric bills for residential, small commercial, and street
lighting customers of the San Diego Gas and Electric Company, through
December 31, 2002, retroactive to June 1, 2000. If the commission
finds it in the public interest, this ceiling may be extended through
December 2003 and may be adjusted as provided in subdivision (d).
(c) The commission shall establish an accounting procedure to
track and recover reasonable and prudent costs of providing electric
energy to retail customers unrecovered through retail bills due to
the application of the ceiling provided for in subdivision (b). The
accounting procedure shall utilize revenues associated with sales of
energy from utility-owned or managed generation assets to offset an
undercollection, if undercollection occurs. The accounting procedure
shall be reviewed periodically by the commission, but not less
frequently than semiannually. The commission may utilize an existing
proceeding to perform the review. The accounting procedure and
review shall provide a reasonable opportunity for San Diego Gas and
Electric Company to recover its reasonable and prudent costs of
service over a reasonable period of time.
(d) If the commission determines that it is in the public interest
to do so, the commission, after the date of the completion of the
proceeding described in subdivision (g), may adjust the ceiling from
the level specified in subdivision (b), and may adjust the frozen
rate from the levels specified in subdivision (f), consistent with
the Legislature's intent to provide substantial protections for
customers of the San Diego Gas and Electric Company and their
interest in just and reasonable rates and adequate service.
(e) For purposes of this section, "small commercial customer"
includes, but is not limited to, all San Diego Gas and Electric
Company accounts on Rate Schedule A of the San Diego Gas and Electric
Company, all accounts of customers who are "general acute care
hospitals," as defined in Section 1250 of the Health and Safety Code,
all San Diego Gas and Electric Company accounts of customers who are
public or private schools for pupils in kindergarten or any of
grades 1 to 12, inclusive, restaurants, shopping centers, and all
accounts on Rate Schedule AL-TOU under 100 kilowatts.
(f) The commission shall establish an initial frozen rate of six
and five-tenths cents ($.065) per kilowatthour on the energy
component of electric bills for all customers of the San Diego Gas
and Electric Company not subject to subdivision (b), for the time
period ending with the end of the rate freeze for the Pacific Gas and
Electric Company and the Southern California Edison Company pursuant
to Section 368, retroactive to February 7, 2001. The commission
shall consider the comparable energy components of rates for
comparable customer classes served by the Pacific Gas and Electric
Company and the Southern California Edison Company and, if it
determines it to be in the public interest, the commission may adjust
this frozen rate, and may do so, retroactive to February 7, 2001.
The commission shall adjust the California Procurement Adjustment and
the Fixed Department of Water Resources Set-Aside determined
pursuant to Section 360.5 for customers subject to this subdivision
to reflect a retail rate consistent with the rate for the energy
component of electric bills as determined in this subdivision, in
place of the retail rate in effect on January 5, 2001. This section
shall be construed to modify the payment provisions, but may not be
construed to modify the electric procurement obligations of the
Department of Water Resources, pursuant to any contract or agreement
in accordance with Division 27 (commencing with Section 80000) of the
Water Code, and in effect as of February 7, 2001, between the
Department of Water Resources and San Diego Gas and Electric Company.
(g) The commission shall institute a proceeding to examine the
prudence and reasonableness of the San Diego Gas and Electric Company
in the procurement of wholesale energy on behalf of its customers,
for a period beginning at the latest on June 1, 2000. If the
commission finds that San Diego Gas and Electric Company acted
imprudently or unreasonably, the commission shall issue orders that
it determines to be appropriate affecting the retail rates of San
Diego Gas and Electric Company customers including, but not limited
to, refunds.
SEC. 2. Section 80134 of the Water Code is amended to read:
80134. (a) The department shall, and in any obligation entered
into pursuant to this division may covenant to, at least annually,
and more frequently as required, establish and revise revenue
requirements sufficient, together with any moneys on deposit in the
fund, to provide all of the following:
(1) The amounts necessary to pay the principal of and premium, if
any, and interest on all bonds as and when the same shall become due.
(2) The amounts necessary to pay for power purchased by it and to
deliver it to purchasers, including the cost of electric power and
transmission, scheduling, and other related expenses incurred by the
department, or to make payments under any other contracts,
agreements, or obligations entered into by it pursuant hereto, in the
amounts and at the times the same shall become due.
(3) Reserves in such amount as may be determined by the department
from time to time to be necessary or desirable.
(4) The pooled money investment rate on funds advanced for
electric power purchases prior to the receipt of payment for those
purchases by the purchasing entity.
(5) Repayment to the General Fund of appropriations made to the
fund pursuant hereto or hereafter for purposes of this division,
appropriations made to the Department of Water Resources Electric
Power Fund, and General Fund moneys expended by the department
pursuant to the Governor's Emergency Proclamation dated January 17,
2001.
(6) The amounts necessary to reimburse the department for any
undercollection of the department's acquisition costs, plus other
costs as provided in Section 80200, pursuant to the rate requirements
imposed by Section 332.1 of the Public Utilities Code.
(7) The administrative costs of the department incurred in
administering this division.
(b) The department shall notify the commission of its revenue
requirement pursuant to Section 80110.
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.
SEC. 4. This act is an urgency statute necessary for the immediate
preservation of the public peace, health, or safety within the
meaning of Article IV of the Constitution and shall go into immediate
effect. The facts constituting the necessity are:
In order to mitigate the high energy costs for large consumers
such as schools and businesses, due to the energy situation of 2001,
it is necessary that this act take effect immediately.