BILL ANALYSIS
SB 85 X2
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Date of Hearing: September 6, 2001
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Carole Migden, Chairwoman
SB 85 X2 (Burton) - As Amended: August 28, 2001
Policy Committee: E.C.&A.Vote:16-0
Urgency: No State Mandated Local Program:
No Reimbursable:
SUMMARY
This bill prohibits the Public Utilities Commission (PUC) from
raising electrical rates up to or above levels in effect prior
to imposition of the 10% rate reduction-which extends until
March 1, 2002 for residential and small commercial customers
solely for purposes of restoring rates to
their previous level.
FISCAL EFFECT
Absorbable costs to the PUC.
COMMENTS
Background and Purpose . In 1998, when electrical restructuring
opened up the market to direct access, a rate reduction was put
into place for residential and small commercial customers of
electrical corporations in California. The reductions were to
remain in effect until March 1, 2002. Subsequently, for reasons
unrelated to recovery of uneconomic costs associated with
competition, the PUC has ordered various rate increases for all
classes of customers to allow electrical corporations to recover
costs of operation.
This measure provides that when the 10% rate reduction ends on
March 1, 2002, that CPUC cannot order rates to go back up to or
to exceed the levels they were at prior to issuance of the
reduction in 1998 solely for the purpose of restoring rates to
their previous levels. Nothing in this bill precludes CPUC from
raising residential and small commercial customer rates for
other reasons related to cost recovery and revenue requirement
needs.
SB 85 X2
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Analysis Prepared by : Chuck Nicol / APPR. / (916)319-2081