BILL ANALYSIS
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|SENATE RULES COMMITTEE | AB 380|
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THIRD READING
Bill No: AB 380
Author: Nunez (D)
Amended: 9/2/05 in Senate
Vote: 21
SENATE ENERGY, UTILITIES & COMMUN. COMM : 10-0, 6/30/05
AYES: Escutia, Morrow, Alarcon, Battin, Bowen, Cox, Dunn,
Kehoe,
Murray, Simitian
NO VOTE RECORDED: Campbell
SENATE APPROPRIATIONS COMMITTEE : Senate Rule 28.8
ASSEMBLY FLOOR : 74-0, 5/19/05 (Passed on Consent) - See
last page for vote
SUBJECT : Electrical restructuring: resource adequacy
SOURCE : Author
DIGEST : This bill establishes resource adequacy
standards for electric utilities and other providers of
electric service, collectively referred to as load-serving
entities.
Senate Floor Amendments of 9/2/05: (a) authorize the
Public Utilities Commission to consider a "centralized
resource adequacy mechanism" in determining the best way to
meet the objectives of the bill, and (b) make various
technical and clarifying changes.
CONTINUED
AB 380
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ANALYSIS : Existing law requires the California Public
Utilities Commission (PUC) to review electric corporations'
procurement and renewable energy procurement plans to
ensure that sufficient resources are available to ensure
reliable service to ratepayers.
Load-serving entities (LSEs) include investor-owned
utilities (IOUs), electric service providers (ESPs),
community choice aggregators (CCAs), and publicly owned
electric utilities.
This bill:
1.Requires the PUC to establish resource adequacy
requirements to meet specified objectives, most
importantly, ensuring that each LSE has enough
reasonably-priced power to serve their customers
reliably.
2.Requires all load-serving entities (LSEs) to be subject
to the same requirements for resource adequacy, energy
efficiency, and the renewable portfolio standard.
3.Requires LSEs to report resource adequacy information to
the PUC.
4.Requires the PUC to enforce resource adequacy
requirements for all LSEs.
5.Assures full recovery of utility resource adequacy costs
approved by the PUC.
6.Exempts municipal utilities, the State Water Project, and
specified customer generation.
7.Establishes separate, self-enforced resource adequacy
requirements for municipal utilities.
8.Authorizes the PUC to consider a "centralized resource
adequacy mechanism" in determining the best way to meet
the objectives of the bill.
9.Requires the CEC to report to the Legislature, to be
AB 380
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included in each integrated energy policy report, as
specified, regarding the programs made by each local
publicly owned electric utility serving end-use customers
in meeting the requirements of this bill.
Note:"Centralized resource adequacy mechanism" is not a
known term and is not defined in the bill. The
vagueness of this provision could be a concern,
although it only authorizes the PUC to consider a
"centralized resource adequacy mechanism," something
the PUC could do with or without this provision.
Essentially, the provision has no effect.
Comments
The PUC has adopted resource adequacy requirements which
require LSEs to achieve 15-17 percent reserve margins by
June 1, 2006. In its orders on resource adequacy, the PUC
has maintained it has authority to apply requirements to
non-utility LSEs, such as energy service providers (ESPs).
The ESPs have contested the PUC's authority to require ESPs
to meet the PUC's requirements, but haven't changed the
PUC's mind or succeeded in getting a court to overturn the
PUC's jurisdiction in this area. The PUC is in the process
of implementing its resource adequacy requirements.
Currently, the PUC's jurisdiction over ESPs is derived from
general registration requirements which don't specify the
ESPs' resource adequacy obligations. This bill would make
the PUC's authority to apply and enforce resource adequacy
requirements on ESPs unambiguous. According to the PUC,
this bill minimizes, if not eliminates, any legal
uncertainty over its authority to set resource adequacy
standards.
Prior Legislation
AB 2006 (Nunez), 2003-04 Session, which was vetoed by the
Governor last year. Also contained resource adequacy
provisions similar to this bill.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
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SUPPORT : (Verified 8/24/04)
American Federation of State, County and Municipal
Employees
California Public Utilities Commission
Coalition of California Utility Employees
Duke Energy
Southern California Edison
The Utility Reform Network
OPPOSITION : (Verified 8/24/05)
South San Joaquin Irrigation District
Western States Petroleum Association
ASSEMBLY FLOOR :
AYES: Aghazarian, Arambula, Baca, Bass, Berg, Bermudez,
Blakeslee, Bogh, Canciamilla, Chan, Chu, Cogdill, Cohn,
Coto, Daucher, De La Torre, DeVore, Dymally, Emmerson,
Evans, Frommer, Goldberg, Hancock, Harman, Haynes, Jerome
Horton, Shirley Horton, Houston, Huff, Jones, Karnette,
Keene, Klehs, Koretz, La Malfa, La Suer, Laird, Leno,
Leslie, Levine, Lieber, Matthews, Maze, McCarthy,
Montanez, Mountjoy, Mullin, Nakanishi, Nation, Nava,
Negrete McLeod, Niello, Oropeza, Parra, Pavley, Plescia,
Richman, Ridley-Thomas, Sharon Runner, Ruskin, Saldana,
Salinas, Spitzer, Strickland, Torrico, Tran, Umberg,
Vargas, Villines, Walters, Wolk, Wyland, Yee, Nunez
NO VOTE RECORDED: Benoit, Calderon, Chavez, Garcia,
Gordon, Liu
NC:nl 9/3/05 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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