BILL ANALYSIS                                                                                                                                                                                                    



                                                                  AB 583
                                                                  Page  1

          Date of Hearing:   April 9, 2003

                        ASSEMBLY COMMITTEE ON APPROPRIATIONS
                              Darrell Steinberg, Chair

                    AB 583 (Leslie) - As Amended:  March 25, 2003 

          Policy Committee:                              Utilities and  
          Commerce     Vote:                            14-0

          Urgency:     No                   State Mandated Local Program:  
          No     Reimbursable:               

           SUMMARY  

          This bill exempts the sale, from a current statutory ban, of  
          generating facilities that are (1) owned by a public utility  
          serving 60,000 or fewer connections and (2) located outside the  
          state.

           FISCAL EFFECT  

          Minor absorbable special fund costs for the Public Utilities  
          Commission (PUC) to provide orders authorizing the sale on any  
          generating facilities.

           COMMENTS  

           1)Background  .  Decisions by the PUC as part of electrical  
            restructuring required the investor-owned utilities (IOUs) to  
            divest at least 50 percent of their fossil-fuel electric  
            generating assets.  The IOUs subsequently sold off almost all  
            of these assets.  The remaining IOU generation assets are  
            subject to rate regulation by the PUC, and during the energy  
            crisis of 2000-01, the Legislature enacted AB X1 6 (Dutra),  
            which prohibits the sale or disposal of any electric  
            generating facility owned by a public utility until January 1,  
            2006.  

           2)Purpose  .  This bill's sponsors, Sierra Pacific Power Company  
            and PacifiCorp, own electric generating assets outside the  
            state, but are public utilities under California law because  
            each serves electricity to retail customers within the state.   
            PacifiCorp serves customers in the northernmost region of the  
            state and Sierra Pacific serves customers in the Lake Tahoe  








                                                                  AB 583
                                                                  Page  2

            region. This bill exempts these companies from the moratorium,  
            but they would continue to be required to obtain an order from  
            the PUC authorizing the sale or transfer of the asset before  
            consummating the sale.

           Analysis Prepared by :    Chuck Nicol / APPR. / (916) 319-2081