BILL NUMBER: AB 67 AMENDED
BILL TEXT
AMENDED IN SENATE JULY 14, 2005
AMENDED IN ASSEMBLY MAY 2, 2005
INTRODUCED BY Assembly Member Levine
DECEMBER 21, 2004
An act to add Section 747 to the Public Utilities Code, relating
to electricity energy .
LEGISLATIVE COUNSEL'S DIGEST
AB 67, as amended, Levine Electricity:
Energy: rates: report to Legislature.
Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including electrical corporations
and gas corporations, as defined. Under existing law, a public
utility has a duty to serve, including furnishing and maintaining
adequate, efficient, just and reasonable service, instrumentalities,
equipment, and facilities as are necessary to promote the safety,
health, comfort, and convenience of its patrons and the public.
Existing law authorizes the commission to fix the rates and
charges for every public utility, and requires that those rates and
charges be just and reasonable.
Existing law authorized the Department of Water Resources, until
January 1, 2003, to enter into contracts for the purchase of
electricity, and to sell electricity to retail end-use customers and,
with specified exceptions, local publicly owned electric utilities,
at not more than the department's acquisition costs and to recovery
those costs through the issuance of bonds, to be repaid by
ratepayers.
This bill would require the president of the commission
to annually report to the appropriate policy
committees of the Legislature , by June 1, 2006, and
by June 1 of each year thereafter, a 10-year forecast for the
different aspects and elements of electricity rates for each class of
ratepayers, meeting specified requirements, for each electrical
corporation. The bill would require the commission to use the
forecasts to develop policies that reduce, and eventually eliminate,
fixed costs for bond debt incurred by the Department of Water
Resources for power purchase contracts and stranded costs inherent in
electricity rates for all classes. The bill would require the
commission to ensure that reductions created by retiring debt or
expiring costs are not replaced by other utility costs, new public
goods programs, or increased costs of existing public goods programs
on the costs of programs and activities conducted by
each electrical corporation and gas corporation, including activities
conducted to comply with their duty to serve .
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 747 is added to the Public Utilities Code, to
read:
747. (a) Notwithstanding Section 7550.5 of the
Government Code, the commission shall report to the Legislature, by
June 1, 2006, and by June 1 of each year thereafter, a 10-year
forecast for the different aspects and elements of electricity rates
for each class of ratepayers, for each electrical corporation. To
perform these forecasts, the commission may require submission of pro
forma analyses, debt retirement schedules, amortization schedules,
wholesale energy cost projections, resource plans, market
assessments, and related outlooks from electrical corporations, gas
corporations, and energy market participants. The yearly reports
beginning June 1, 2007, shall include a detailed description of any
changes in projections or assumptions that may be different from the
previous year's forecast. For purposes of this subdivision, "energy
market participants" includes any entity that is a "market
participant" as defined in the Master Definitions Supplement of the
California Independent System Operator Corporation tariff approved by
the Federal Energy Regulatory Commission or its successor, and the
Independent System Operator incorporated pursuant to Section 340.
(b) In developing the forecasts prepared pursuant to subdivision
(a), the commission shall do all of the following:
(1) Provide detailed quantitative and descriptive information
about the elements of electricity rates, including timelines.
(2) Develop and maintain the analytical capability sufficient to
answer inquiries about electricity rates from government, market
participants, and the public.
(3) Analyze and develop ratemaking policies.
(4) Provide an analytical foundation for regulatory and policy
decisionmaking.
(5) Facilitate efficient and reliable electricity markets.
(c) The commission
shall use the 10-year forecasts to develop policies that reduce, and
eventually eliminate, fixed costs for bond debt incurred pursuant to
Division 27 (commencing with Section 80000) of the Water Code and
stranded costs inherent in electricity rates for all classes. The
commission shall ensure that reductions created by retiring debt or
expiring costs are not replaced by other utility costs, new public
goods programs, or increased costs of existing public goods programs.
It is the intent of the Legislature that the
commission reduce rates for electricity and natural gas to the lowest
amount possible while maintaining adequate service.
(b) The president of the commission shall annually appear before
the appropriate policy committees of the Senate and Assembly to
report on the costs of programs and activities conducted by each
electrical corporation and gas corporation, including activities
conducted to comply with their duty to serve. The report shall
identify, clearly and concisely, all of the following:
(1) Each program or activity mandated by statute and its annual
cost to ratepayers.
(2) Each program or activity mandated by the commission and its
annual cost to ratepayers.
(3) Electricity purchase contract costs and bond-related costs
incurred pursuant to Division 27 (commencing with Section 80000) of
the Water Code.
(4) All other aggregated categories of costs currently recovered
in retail rates.