BILL NUMBER: SBX1 9 AMENDED
BILL TEXT
AMENDED IN SENATE MARCH 12, 2001
INTRODUCED BY Senator Morrow
JANUARY 22, 2001
An act to amend Section 739.5 of the Public Utilities
Code, relating to utilities, and declaring the urgency thereof, to
take effect immediately. add Article 3.5 (commencing
with Section 353.1) to Chapter 2.3 of Part 1 of Division 1 of, and to
repeal Sections 353.1, 353.3, 353.5, 353.7, and 353.9 of, the Public
Utilities Code, relating to public utilities.
LEGISLATIVE COUNSEL'S DIGEST
SB 9, as amended, Morrow. Electric bill: master-meter
customers: rate ceiling Public Utilities Commission:
distributed energy resources .
(1) The Public Utilities Act requires every master-meter customer
to provide an itemized billing of charges for electricity or gas, or
both, to each individual user generally in accordance with the form
and content of bills of the corporation to its residential customers.
The act requires the Public Utilities Commission to establish a
ceiling of 6.5
per kilowatt hour 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. b This bill would
require the billing to show any undercollection in the current
billing cycle due to the ceiling, the total accumulated
undercollection to that date, and accumulated interest on the
accumulated undercollection, as prescribed, and to be consistent with
specified accounting procedures. The bill would require a specified
notice. Because a violation of the act is a crime, this bill would
impose a state-mandated local program by creating a new crime.
The bill would allow submeter customers to elect to make
inapplicable that electricity rate ceiling and to pay the full cost
of electricity used plus an amount that equals the simple interest on
any unpaid amounts, as specified, if the related master-meter
customer and all other submeter customers elect to make inapplicable
that electricity rate ceiling.
(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.
(3) This bill would declare that it is to take effect immediately
as an urgency statute.
(1) Under existing law, the Public Utilities Commission has
regulatory authority over public utilities, including electrical
corporations and other specified entities.
This bill would require the commission to require each electrical
corporation to modify tariffs so that all customers installing new
distributed energy resources, as defined, are served under rates,
rules, and requirements identical to those of a customer within the
same rate schedule that does not use distributed energy resources,
and to withdraw any provisions in otherwise applicable tariffs that
activate other tariffs, rates, or rules if a customer uses
distributed energy resources. The bill would require the commission
to require each electrical corporation, as part of its distribution
planning process, to include nonutility owned distributed energy
resources as a possible alternative to investments in its
distribution system in order to ensure reliable electric service at
the lowest possible cost. The bill would require the commission to
require each electrical corporation to adopt standard contract terms,
conditions, penalties, and enforcement mechanisms for distributed
energy resources units providing distribution reliability services.
The bill would require the commission, in establishing the rates
under the provisions of the bill, to create a firewall that
segregates distribution cost recovery, as described. The bill would
require a local publicly owned electric utility, as defined, or a
local publicly owned utility otherwise providing electrical service,
to undertake a review of its rates, tariffs, and rules, as
prescribed, and to hold at least one noticed public meeting to
solicit public comment on the review and any recommended changes. The
bill would repeal the above-described provisions as of January 1,
2005.
The bill would require the commission to require each electrical
corporation to establish new tariffs on or before January 1, 2005 for
customers using distributed energy resources installed on or after
June 1, 2005. Tariffs modified under the bill would continue to
apply to distributed energy resources installed before June 1, 2005,
for 10 years after the date of installation, as specified. The bill
would require the commission to prepare and submit to the
Legislature, on or before March 1, 2004, a report describing its
proposed methodology for determining the new rates and the process by
which it will establish those rates.
Because a violation of a requirement of the commission is a crime,
this bill would impose a state-mandated local program by creating a
new crime.
Vote: 2/3 majority .
Appropriation: no. Fiscal committee: yes. State-mandated local
program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 739.5 of the Public Utilities Code is
SECTION 1. Article 3.5 (commencing with Section 353.1) is added to
Chapter 2.3 of Part 1 of Division 1 of the Public Utilities Code, to
read:
Article 3.5. Distributed Energy Resources
353.1. As used in this article, "distributed energy resources"
means any electric generation technology installed and operational on
or after May 1, 2001, located within a single facility five
megawatts or smaller in aggregate capacity that primarily serves
nearby electric load, is powered by any fuel other than diesel, and
meets the State Air Resources Board emission standards and guidelines
for distributed generation, as defined in Sections 41514.9 and
41514.10 of the Health and Safety Code. Until standards and
guidelines have been adopted by the State Air Resources Board, for
the purpose of this article, distributed energy resources shall meet
emissions levels equivalent to ____.
353.3. The commission shall require each electrical corporation
to modify tariffs so that all customers installing new distributed
energy resources are served under rates, rules, and requirements
identical to those of a customer within the same rate schedule that
does not use distributed energy resources, and to withdraw any
provisions in otherwise applicable tariffs that activate other
tariffs, rates, or rules if a customer uses distributed energy
resources. Except as specified in Section 353.7, customers may not
be subject to the application of additional rates or tariffs solely
because of their use of distributed energy resources to serve onsite
loads or over-the-fence transactions allowed under Sections 216 and
218.
353.5. The commission shall require each electrical corporation,
as part of its distribution planning process, to include nonutility
owned distributed energy resources as a possible alternative to
investments in its distribution system in order to ensure reliable
electric service at the lowest possible cost. The commission shall
require each electrical corporation to adopt standard contract terms,
conditions, penalties, and enforcement mechanisms for distributed
energy resources units providing distribution reliability services.
The commission shall review for the purpose of compliance with this
section, on an annual basis, the progress of each corporation in
incorporating these changes into their planning processes.
353.7. Nothing in this article may result in any exemption from
reasonable interconnection charges, lead to any reduction in
contributions by each customer class to public purpose programs
funded under Section 399.8, or relieve any customer of any obligation
determined by the commission to result from participation in the
purchase of power through the Department of Water Resources pursuant
to Division 27 (commencing with Section 80000) of the Water Code.
353.9. In establishing the rates required under this article, the
commission shall create a firewall that segregates distribution cost
recovery so that any net costs, taking into account the actual costs
and benefits of distributed energy resources, proportional to each
customer class, as determined by the commission, resulting from the
tariff modifications granted to members of each customer class may be
recovered only from that class.
353.11. A local publicly owned electric utility, as defined in
subdivision (d) of Section 9604, or a local publicly owned utility
otherwise providing electrical service, shall review at the earliest
practicable date its rates, tariffs, and rules to identify barriers
to and determine the appropriate balance of costs and benefits of,
distributed energy resources in order to facilitate the installation
of these resources in the interests of their customer-owners and the
state, and shall hold at least one noticed public meeting to solicit
public comment on the review and any recommended changes. However,
notwithstanding any other provision of this article, such an entity
has the sole authority to undertake such a review and to make
modifications to its rates, tariffs, and rules as the governing body
of that utility determines to be necessary.
353.13. Sections 353.1, 353.3, 353.5, 353.7, and 353.9 shall
remain in effect only until January 1, 2005, and as of that date are
repealed, unless a later enacted statute, that is enacted before
January 1, 2005, deletes or extends that date.
353.14. (a) The commission shall require each electrical
corporation to establish new tariffs on or before January 1, 2005,
for customers using distributed energy resources installed on or
after June 1, 2005. Distributed energy resources installed before
June 1, 2005, shall be subject to those tariffs in existence pursuant
to this article as of December 31, 2004, for a period of 10 years
from the date of installation. Those tariffs required pursuant to
this section shall ensure that all net distribution costs incurred to
serve each customer class, taking into account the actual costs and
benefits of distributed energy resources, proportional to each
customer class, as determined by the commission, are fully recovered
only from that class. The commission shall require each electrical
corporation, in establishing those rates, to ensure that customers
with similar load profiles within a customer class will, to the
extent practicable, be subject to the same utility rates, regardless
of their use of distributed energy resources to serve onsite loads or
over-the-fence transactions allowed under Sections 216 and 218.
Customers with dedicated facilities shall remain responsible for
their obligations regarding payment for those facilities.
(b) The commission shall prepare and submit to the Legislature, on
or before March 1, 2004, a report describing its proposed
methodology for determining the new rates and the process by which it
will establish those rates. It is the intent of this Legislature
that the Legislature will review the report and provide direction to
the commission on how to proceed within 90 days after the date of
receiving the report.
SEC. 2. 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.
amended to read:
739.5. (a) The commission shall require that, whenever gas or
electric service, or both, is provided by a master-meter customer to
users who are tenants of a mobilehome park, apartment building, or
similar residential complex, the master-meter customer shall charge
each user of the service at the same rate which would be applicable
if the user were receiving gas or electricity, or both, directly from
the gas or electrical corporation. The commission shall require the
corporation furnishing service to the master-meter customer to
establish uniform rates for master-meter service at a level which
will provide a sufficient differential to cover the reasonable
average costs to master-meter customers of providing submeter
service, except that these costs shall not exceed the average cost
that the corporation would have incurred in providing comparable
services directly to the users of the service.
(b) Every master-meter customer of a gas or electrical corporation
subject to subdivision (a) who, on or after January 1, 1978,
receives any rebate from the corporation shall distribute to, or
credit to the account of, each current user served by the
master-meter customer that portion of the rebate which the amount of
gas or electricity, or both, consumed by the user during the last
billing period bears to the total amount furnished by the corporation
to the master-meter customer during that period.
(c) An electrical or gas corporation furnishing service to a
master-meter customer shall furnish to each user of the service
within a submetered system every public safety customer service which
it provides beyond the meter to its other residential customers.
The corporation shall furnish a list of those services to the
master-meter customer who shall post the list in a conspicuous place
accessible to all users. Every corporation shall provide these
public safety customer services to each user of electrical or gas
service under a submetered system without additional charge unless
the corporation has included the average cost of these services in
the rate differential provided to the master-meter customer on
January 1, 1984, in which case the commission shall deduct the
average cost of providing these public safety customer services when
approving rate differentials for master-meter customers.
(d) Every master-meter customer is responsible for maintenance and
repair of its submeter facilities beyond the master meter, and
nothing in this section requires an electrical or gas corporation to
make repairs to or perform maintenance on the submeter system.
(e) (1) Every master-meter customer shall provide an itemized
billing of charges for electricity or gas, or both, to each
individual user generally in accordance with the form and content of
bills of the corporation to its residential customers, including, but
not limited to, the opening and closing readings for the meter, and
the identification of all rates and quantities attributable to each
block in the applicable rate structure. The master-meter customer
shall also post, in a conspicuous place, the applicable prevailing
residential gas or electrical rate schedule, as published by the
corporation.
(2) Each bill shall separately show any undercollection of
reasonable and prudent costs of providing electric energy to the
customer unrecovered in the current billing cycle due to the
application of the ceiling provided for in subdivision (b) of Section
332.1, the total accumulated undercollection for the period from the
date of the imposition of the ceiling to the date of the bill, and
accumulated interest on the accumulated undercollection, which shall
accrue as simple, fixed interest at a rate not to exceed the average
interest rate paid by the San Diego Gas and Electric Company for
loans to finance its purchase of wholesale electricity in the
previous billing cycle. The billing shall be consistent with
subdivision (c) of Section 332.1.
(3) Each bill showing any undercollection pursuant to paragraph
(2) shall contain a notice as follows:
"NOTICE: Payment of this bill, in part or in full, does not
affect the legal standing of the ratepayer with regard to any future
refund, credit, or other adjustment ordered by a local, state, or
federal agency, including, but not limited to, any court order issued
pursuant to litigation."
(f) The commission shall require that every electrical and gas
corporation shall notify each master-meter customer of its
responsibilities to its users under this section.
(g) Notwithstanding subdivision (b) of Section 332.1, submeter
customers subject to that subdivision may elect, in writing, at least
30 days in advance of the affected billing period, to make
inapplicable the electricity rate ceiling established pursuant to
that section and to pay the full cost of electricity used plus an
amount that equals the simple interest on any unpaid amounts at the
rate described in subdivision (e), if the related master-meter
customer and all other submeter customers elect to make inapplicable
that electricity rate ceiling.
SEC. 2. 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. 3. 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 modify utility billing practices to provide adequate
disclosure to ratepayers of the San Diego Gas and Electric Company of
undercollections by that company due to the rate ceiling imposed by
Chapter 328 of the Statutes of 2000, and to allow certain ratepayers
to elect to make the ceiling inapplicable, as soon as possible, it is
necessary that this act take effect immediately.