BILL NUMBER: SB 1976	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  JUNE 28, 2002
	AMENDED IN ASSEMBLY  JUNE 19, 2002
	AMENDED IN SENATE  APRIL 30, 2002

INTRODUCED BY   Senator Torlakson

                        FEBRUARY 22, 2002

   An act relating to energy resources, and declaring the urgency
thereof, to take effect immediately.


	LEGISLATIVE COUNSEL'S DIGEST


   SB 1976, as amended, Torlakson.  State Energy Resources
Conservation and Development Commission: report: real-time pricing.
   Existing law requires the State Energy Resources Conservation and
Development Commission to conduct an ongoing assessment of the
opportunities and constraints presented by all forms of energy.  

   Under existing law, the Public Utilities Commission is required to
conduct a pilot study of real-time metering for nonresidential
customers, to determine the effectiveness of real-time metering in
reducing energy demand and overall energy consumption, to examine
customer response, to determine how real time metering should be
implemented, and to determine whether more widespread use of
real-time metering is in the public interest. Real-time metering is a
system for measuring a customer's usage of electricity on at least
an hourly basis, variably pricing that electricity based on the cost
of acquisition or production, and regularly providing and updating
that usage and pricing information to the customer. 
   This bill would require the commission, in consultation with the
Public Utilities Commission, to report to the Legislature and the
Governor, by March 31, 2003, regarding the feasibility of
implementing real-time  , critical peak, and other dynamic 
pricing tariffs for electricity in California  , as strategies
which can either reduce peak demand or shift peak demand load to
off-peak periods  .
   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:  no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  The Legislature finds and declares all of the
following:
   (a) Californians can significantly increase the reliability of the
electricity system and reduce the level of wholesale electricity
prices by reducing electricity usage at peak times through a variety
of measures designed to reduce electricity consumption during those
periods.
   (b)  Real-time pricing   Dynamic pricing,
including real-time pricing,  provides incentives to reduce
electricity consumption in precisely those hours when supplies are
tight and provides lower prices when wholesale prices are low.
   (c) The State of California, through Assembly Bill 29 of the
2001-02 First Extraordinary Session, has already invested thirty-five
million dollars ($35,000,000) in real-time  meters 
 metering systems  for customers who consume greater than
200 kilowatts.
   (d) Real-time pricing integrates information technology into the
energy business, and creates new markets for communications,
microelectronic controls, and information.
   (e) Electricity consumption for air conditioning purposes during
peak demand periods significantly contributes to California's
electricity shortage vulnerability during summer periods.
   (f) It is the intent of the Legislature to promote energy
conservation and demand reduction in the State of California.
  SEC. 2.  (a) On or before March 31, 2003, the State Energy
Resources Conservation and Development Commission, in consultation
with the Public Utilities Commission, shall report to the Legislature
and the Governor regarding the feasibility of implementing real-time
pricing  tariffs for electricity in California 
 , critical peak pricing, and other dynamic pricing tariffs for
electricity in California, as strategies which can either reduce peak
demand or shift peak demand load to off-peak periods  .
   (b) The report shall consider all of the following:
   (1) How wholesale real-time prices would be calculated and made
available to customers.
   (2) Options for day-ahead and hour-ahead retail prices.
   (3) Options for facilitating customer response to real-time 
and critical peak  prices and managing total customer costs,
including, but not limited to,  real-time  
interval  metering and communication systems, consumer-side of
the meter notification, and automatic response equipment.
   (4)  An assessment of the options for a variety of customer
classes, including, but not limited to, industrial, commercial,
residential, and tenants of a mobilehome park, apartment building, or
similar residential complex, that receive electricity from a
master-meter customer through a submetered system.
   (5)  Estimates of potential peak load reductions, including
the shifting of peak load demand to off-peak periods.  
   (5)  
   (6)  Options for incorporating demand responsiveness into the
wholesale competitive market and operations of the California
Independent System Operator.  
   (6)  
   (7)  Options for ensuring customer protection under a
real-time  pricing scenario   , critical peak,
and other dynamic pricing scenarios , including identifying
potentially disadvantaged groups who may be disproportionately
vulnerable to the impact of volatile prices and suggestions for
effective safeguards for those customers.
  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 determine the feasibility of  real-time
  dynamic  pricing as soon as possible, it is
necessary that this act take effect immediately.