BILL ANALYSIS 1
1
SENATE ENERGY, UTILITIES AND COMMUNICATIONS COMMITTEE
DEBRA BOWEN, CHAIRWOMAN
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|SB 1194 - Sher |Hearing Date:April 13, | S|
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|As Introduced:February 26, | | B|
|1999 | | |
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DESCRIPTION
This bill requires public utilities to continue to
administer the energy efficiency and conservation
activities funded by AB 1890 through 2001.
The bill further requires the California Public Utilities
Commission (CPUC) to study the feasibility of administering
these activities through a non-profit public benefit
corporation.
KEY QUESTIONS
1)The CPUC has already proposed to require that utilities
continue to administer these activities through 2001 and
has indicated its preference that a non-profit be
established to administer them beyond 2001. What
additional value will codifying these decisions provide?
2)Should a study of future administration options for these
activities include consideration of the full range of
alternatives, rather than focus exclusively on non-profit
administration?
BACKGROUND
AB 1890 (Brulte), Chapter 854, Statutes of 1996, required
utilities to fund a variety of system reliability, in-state
benefit and low-income customer programs at specified
levels from 1998 through 2001. The largest set of programs
is "cost-effective energy efficiency and conservation
activities," for which the three investor-owned utilities
are required to collect and spend a total of $840 million
over the four-year period.
This funding was intended to ensure that low income and
energy efficiency programs continued (at least in the short
term) in the restructured electric industry. In order to
provide oversight of these programs, the CPUC established
the Low Income Governing Board (LIGB) and the California
Board for Energy Efficiency (CBEE).
Prior to AB 1890, the CPUC required utilities to administer
the various services provided by these programs as part of
their regulated service. In the wake of AB 1890, the CPUC
proposed to place the administration of the programs under
the administration of independent bodies, the LIGB and
CBEE. The proposed independent administration of these
programs, i.e. outside of state government and civil
service requirements, prompted labor interests to intervene
and challenge the CPUC's proposal. The challenge led to a
State Personnel Board ruling rejecting the CPUC's creation
of the LIGB and CBEE as independent bodies.
In response to the ruling and to provide for continuing
administration of the programs, the CPUC placed the
programs under utility administration through 2001. Beyond
2001, the CPUC indicated a preference for legislative
creation of a non-profit organization to administer the
programs, to the extent that future funding for the
programs is authorized.
According to its sponsor, the CPUC, this bill is intended
to codify the CPUC's decision and recognize the need for
legislative and CPUC action to implement ongoing
administration. Apparently, because the statutory fate of
these programs beyond 2001 remains uncertain, the CPUC is
not comfortable providing for long-term administration
without some direction from the Legislature.
COMMENTS
Why limit the options ? Although the CPUC has indicated a
preference for administration of these programs by a
non-profit, the Legislature has not yet made a decision.
If the study required by this bill is intended to provide
useful guidance to the Legislature as it considers the
options for future administration of these programs, should
it include consideration of the full range of alternatives,
rather than focus exclusively on non-profit administration?
If so, since the CPUC has already indicated a preference
for non-profit administration, should the study be
conducted by a more neutral party?
POSITIONS
Support:
CPUC (Sponsor)
Oppose:
None reported to Committee.
Lawrence Lingbloom
SB 1194 Analysis
Hearing Date: April 13, 1999