BILL ANALYSIS                                                                                                                                                                                                    



                                                          AB 1393
                                                          Page  1

CONCURRENCE IN SENATE AMENDMENTS
AB 1393 (Wright)
As Amended June 29, 1999
Majority vote
  
ASSEMBLY: 61-7 ( June 1, 1999 ) SENATE: 23-12                    
( August 23, 1999 )                     
   
  Original Committee Reference:    U. & C.  

  SUMMARY  :  Provides for continued utility administration of  
energy efficiency programs targeted to low-income gas and  
electricity customers, and specifies quality of service factors  
to be used as bidding criteria for contracts funded under these  
programs.  Specifically,  this bill  :  

1)Requires electric and gas corporations that participate in the  
  California Alternate Rates for Energy (CARE) program to  
  administer low-income energy efficiency and rate assistance  
  programs.

2)Requires administrators of the low-income energy program to  
  undertake certain functions, as follows:

   a)   Leverage CARE program funds with funds available from  
     state and federal sources;

   b)   Work with state and local agencies and community-based  
     organizations to ensure efficient and effective delivery of  
     programs;

   c)   Encourage local employment and job skill development;

   d)   Maximize participation of eligible participants; and,

   e)   Work to reduce consumers' electric and gas consumption,  
     and bills.

3)Allows the California Public Utilities Commission (CPUC) to  
  require participating gas and electric corporations to  
  competitively bid, to the extent practical, service delivery  
  components of these programs.

4)Requires bidding criteria to recognize specified factors, such  
  as follows:  








                                                          AB 1393
                                                          Page  2


   a)   Bidder's relevant experience; 

   b)   Knowledge of, and ability to reach targeted communities;  
     and,

   c)   Ability and commitment to train, utilize, and employ  
     people from the local area.

5)Allows CPUC to modify its bid criteria based upon public input  
  from a variety of sources, including representatives of  
  low-income communities and the program administrators.

6)Requires CPUC to require an electric or gas corporation to  
  perform home weatherization services, as defined, for  
  low-income customers, as determined by CPUC.

  The Senate amendments  clarify that the utility administration of  
CARE and low-income energy efficiency programs is subject to  
CPUC oversight.

  EXISTING LAW  requires CPUC to establish a rate assistance  
program for low-income electric and gas customers, referred to  
as the CARE program, and requires specified electric or gas  
corporation to perform home weatherization programs, as defined,  
for low-income customers, as determined by CPUC. 

  AS PASSED BY THE ASSEMBLY  , this bill provided for continued  
utility administration of energy efficiency programs targeted to  
low-income gas and electric customers, and specified quality of  
service factors to be used as bidding criteria for contracts  
funded under these programs.

  FISCAL EFFECT  :  CPUC indicates that this bill would have no  
fiscal impact on its operations.

  COMMENTS  :  Existing law provides for two programs for low-income  
electric and gas customers:  1) CARE, which provides eligible  
low-income and gas electric customers with a 15% credit against  
their bill; and, 2) Low-Income Energy Efficiency (LIEE) program,  
which provides such customers with home weatherization and  
energy efficiency devices.  This bill would provide for  
continued utility administration of the CARE and LIEE programs,  
and specifies quality of service factors to be used as bidding  
criteria for implementation of the LIEE program.  








                                                          AB 1393
                                                          Page  3


In a March, 1999 decision, CPUC ordered continued utility  
administration of low-income energy efficiency programs until  
December 31, 2001.  CPUC is currently reviewing the  
administration of low-income energy efficiency programs, and  
considering various options for administration.  This bill would  
provide statutory guidance to CPUC with regard to administration  
of this program.  

This bill specifies quality of service factors to be taken into  
account by program administrators in awarding service contracts.  
 According to the author, community-based organizations have  
demonstrated the ability to effectively deliver energy  
assistance programs to underserved communities.  This bill will  
create a process where those entities most qualified to  
implement these programs, can compete to administer these  
programs.  This will increase the effectiveness of these  
programs, and ensure a greater penetration level in low-income,  
and under-served communities.

AB 1890 (Brulte), Chapter 854, Statutes of 1996, requires  
low-income energy assistance programs for electricity customers  
to be continuously funded at not less than 1996 levels, subject  
to a CPUC assessment of customer need.  Funds for these, and  
similar low-income programs for gas customers, are collected  
through a surcharge on gas and electric utility bills.  Current  
funding for these programs is approximately $180 million per  
year for all utilities.  This bill does not change the existing  
funding levels for these programs.


  Analysis Prepared by  :  Joseph Lyons / U. & C. / (916) 319-2083 


                                                      FN: 0002507