BILL NUMBER: AB 425	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  APRIL 30, 2003

INTRODUCED BY   Assembly Member Richman

                        FEBRUARY 14, 2003

   An act to amend Section 743.1 of the Public Utilities Code,
relating to public utilities.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 425, as amended, Richman.  Electric service:  rates:
interruptible programs.
   (1) The Public Utilities Act authorizes the Public Utilities
Commission to establish rates for public utilities regulated by the
commission, including electrical corporations.  The act requires
electrical corporations to continue the availability to qualified
heavy industrial customers, until March 31, 2002, of optional
interruptible or curtailable service wherein the heavy industrial
customer is charged a rate that reflects a pricing incentive for
electing to operate under the optional or curtailable service.
   This bill would instead require  the commission to
continue the availability to qualified heavy industrial customers of
optional interruptible or curtailable service until December 31, 2008
  an electrical corporation to continue the
availability to qualified customers, as defined, of optional
interruptible or curtailable service, and would require the effective
rate for that service to reflect a cost-based pricing incentive.
The bill would require the commission to set the incentive level and
to authorize the continued availability of optional interruptible or
curtailable service at that level until December 31, 2008.  The bill
would impose a penalty on a customer receiving interruptible or
curtailable service who does not comply with the commitment to shed
load in excess of the customer's firm service level within the time
period provided for in the tariff, if called upon to do so by the
electrical corporation.  The bill would require an electrical
corporation to remove from the rate option any customer who, upon 2
consecutive requests from the electrical corporation, voluntarily
elects not to comply substantially with its commitment to shed load.
The bill would require an electrical corporation to eliminate by a
certain date any incentive not described above that is included in an
optional interruptible or curtailable service of that electrical
corporation as of January 1, 2004  .
   Because a violation of the act is a crime, this bill, by
continuing to require electrical corporations to offer optional
interruptible or curtailable service  and by imposing new
requirements  , would change the definition of a crime, thereby
imposing a state-mandated local program.
  (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.  Section 743.1 of the Public Utilities Code is amended
to read:
   743.1.  (a) Electrical corporations shall continue the
availability to qualified  heavy industrial 
customers of optional interruptible or curtailable service.   For
purposes of this section, the term "qualified customers" includes
all customers with demand at, or in excess of, 500 kilowatts. 
The effective rate for interruptible or curtailable service to
 qualifying   qualified  customers shall
reflect a  cost-based  pricing incentive for electing to
operate under the interruptible or curtailable service option.  
The commission shall set the cost-based pricing incentive for the
optional interruptible or curtailable service at a level equal to the
level of incentive authorized in the base interruptible program rate
option as of May 1, 2003.  The commission shall authorize the
continued availability of optional interruptible or curtailable
service at this cost-based pricing incentive level until December 31,
2008.
   (b) A customer receiving interruptible or curtailable service who
does not comply with the commitment to shed load in excess of the
customer's firm service level within the time period provided for in
the tariff, if called upon to do so by the electrical corporation,
shall pay a noncompliance penalty of nine dollars and thirty cents
($9.30) per kilowatt hour for excess power taken.  In addition to the
noncompliance penalty, the electrical corporation shall remove from
the rate option any customer who, upon two consecutive requests from
the electrical corporation, voluntarily elects not to comply
substantially with its commitment to shed load.  
   (b) The commission shall direct each public utility electrical
corporation to continue its efforts to reduce the rates charged heavy
industrial customers to a level competitive with other states, and
to do so without shifting recovery of costs to other customer
classes.  The commission shall continue the availability of optional
interruptible or curtailable service at least until December 31,
2008.  In no event shall the level of the pricing incentive for
interruptible or curtailable service be altered from the levels in
effect on June 10, 1996, until December 31, 2008.  
   (c) The commission shall require an electrical corporation to
eliminate any incentive not authorized pursuant to subdivision (a)
that is included in an optional interruptible or curtailable service
rate of that electrical corporation as of January 1, 2004, before the
earlier of the following dates:
   (1) January 1, 2005.
   (2) The date of the next final commission decision in the
allocation of revenue requirement and rate design phase of the
electrical corporation's general rate case proceeding. 
  SEC. 2.  No reimbursement is required by this act pursuant to
Section 6 of Article XIII B 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 XIII B of the California
Constitution.