BILL ANALYSIS
AB 1002
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 1002 (Wright)
As Amended August 25, 2000
2/3 vote
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|ASSEMBLY: | |( June 1, 1999 |SENATE: |27-6 |( August 29, |
| | |) | | |2000 ) |
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(vote not relevant)
Original Committee Reference: U. & C.
SUMMARY : Imposes a surcharge on all natural gas consumed in
California to fund specified low-income, energy efficiency,
conservation and public interest research programs.
Specifically, this bill :
The Senate amendments :
1)Established that the surcharges imposed by this bill are
required to be collected quarterly by the State Board of
Equalization and prescribes that quarterly returns are to be
filed on or before the last day of the month following each
calendar quarter.
2)Exempted from the consumption charge natural gas that is
produced in California and transported on a proprietary
pipeline.
EXISTING LAW :
1)Establishes certain public purpose programs, including energy
efficiency, public interest research and development,
low-income assistance and weatherization.
2)Authorizes the collection of funds through a surcharge on
ratepayers of public utility gas corporations.
AS PASSED BY THE ASSEMBLY , this bill:
1)Required the California Public Utilities Commission (CPUC) to
impose a surcharge on all natural gas consumed in the state.
2)Exempted specified natural gas usage from the consumption
AB 1002
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surcharge, including natural gas utilized to generate power
for sale, for resale to end users, for enhanced oil recovery,
in cogeneration technology projects to produce electricity,
pursuant to contracts previously approved by CPUC which do not
currently impose the surcharge, and gas sold within the
service territory of a municipality that provides similar
programs.
3)Required CPUC to establish the surcharge rate for each class
of customer and notify the State Board of Equalization (BOE)
of the surcharge and requires each end user on an interstate
pipeline to notify BOE of their consumption.
4)Required that revenues collected from the surcharge be paid to
BOE and deposited into the Gas Consumption Surcharge Fund to
be created in the State Treasury to fund the public purpose
programs.
5)Appropriated funds to pay CPUC and BOE for their costs
associated with the administration of these programs.
6)Established an advisory board to administer programs and
conduct financial and compliance audits.
7)Instituted a tariff rate to apply to customers who bypass
public utility gas corporation and subsequently seek to
utilize the public utility gas corporation for transportation
services.
FISCAL EFFECT : BOE estimates annual costs of $70,000 to
administer the surcharge and CPUC would incur minor absorbable
costs.
COMMENTS : This bill establishes a surcharge on all natural gas
customers to ensure the financial stability of California's
public purpose programs.
The Senate amendments establish the filing and collection
process for the Board of Equalization. Gas marketers do not
collect or have information on who the end customers receiving
the gas is. A broker handles those activities. Thus, this
bill requires the end user to file reports of its gas
consumption to the Board of Equalization.
Additionally the Senate amendments exempt certain natural gas
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types that could not otherwise be transported through the gas
utility pipeline. Gas produced in California does not meet the
specifications required by the gas utility. The surcharge is
not collected on those fuels today. This amendment would put
into policy the current practice exempting such fuels from the
surcharge.
Analysis Prepared by : Carolyn Veal-Hunter / U. & C. / (916)
319-2083
FN:
0006979