BILL NUMBER: AB 1407 AMENDED
BILL TEXT
AMENDED IN ASSEMBLY APRIL 16, 2013
INTRODUCED BY Committee on Utilities and Commerce (Bradford
(Chair), Bonilla, Fong, Garcia, Quirk, Rendon, Skinner, and Williams)
MARCH 13, 2013
An act to amend Section 380 of the Public Utilities Code, relating
to public utilities.
LEGISLATIVE COUNSEL'S DIGEST
AB 1407, as amended, Committee on Utilities and Commerce. Public
utilities: resource adequacy requirement.
Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including electrical corporations.
Existing law requires the commission, in consultation with the
Independent System Operator to establish resource adequacy
requirements for all load-serving entities to achieve specified
objectives.
This bill would make technical, nonsubstantive changes to
that provision additionally require the Public
Utilities Commission to consult with the State Energy Resources
Conservation and Development Commission to establish the resource
adequacy requirements .
Vote: majority. Appropriation: no. Fiscal committee: no
yes . State-mandated local program: no.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 380 of the Public Utilities Code is amended to
read:
380. (a) The commission, in consultation with the Independent
System Operator and the Energy Commission , shall
establish resource adequacy requirements for all load-serving
entities.
(b) In establishing resource adequacy requirements, the commission
shall achieve all of the following objectives:
(1) Facilitate development of new generating capacity and
retention of existing generating capacity that is economic and
needed.
(2) Allocate equitably the cost of generating capacity and prevent
the shifting of costs between customer classes.
(3) Minimize enforcement requirements and costs.
(4) Maximize the ability of community choice aggregators to
determine the generation resources used to serve their customers.
(c) Each load-serving entity shall maintain physical generating
capacity adequate to meet its load requirements, including, but not
limited to, peak demand and planning and operating reserves. The
generating capacity shall be deliverable to locations and at times as
may be necessary to provide reliable electric service.
(d) Each load-serving entity shall, at a minimum, meet the most
recent minimum planning reserve and reliability criteria approved by
the Board of Trustees of the Western Systems Coordinating Council or
the Western Electricity Coordinating Council.
(e) The commission shall implement and enforce the resource
adequacy requirements established in accordance with this section in
a nondiscriminatory manner. Each load-serving entity shall be subject
to the same requirements for resource adequacy and the renewables
portfolio standard program that are applicable to electrical
corporations pursuant to this section, or otherwise required by law,
or by order or decision of the commission. The commission shall
exercise its enforcement powers to ensure compliance by all
load-serving entities.
(f) The commission shall require sufficient information,
including, but not limited to, anticipated load, actual load, and
measures undertaken by a load-serving entity to ensure resource
adequacy, to be reported to enable the commission to determine
compliance with the resource adequacy requirements established by the
commission.
(g) An electrical corporation's costs of meeting resource adequacy
requirements, including, but not limited to, the costs associated
with system reliability and local area reliability, that are
determined to be reasonable by the commission, or are otherwise
recoverable under a procurement plan approved by the commission
pursuant to Section 454.5, shall be fully recoverable from those
customers on whose behalf the costs are incurred, as determined by
the commission, at the time the commitment to incur the cost is made,
on a fully nonbypassable basis, as determined by the commission. The
commission shall exclude any amounts authorized to be recovered
pursuant to Section 366.2 when authorizing the amount of costs to be
recovered from customers of a community choice aggregator or from
customers that purchase electricity through a direct transaction
pursuant to this subdivision.
(h) The commission shall determine and authorize the most
efficient and equitable means for achieving all of the following:
(1) Meeting the objectives of this section.
(2) Ensuring that investment is made in new generating capacity.
(3) Ensuring that existing generating capacity that is economic is
retained.
(4) Ensuring that the cost of generating capacity is allocated
equitably.
(5) Ensuring that community choice aggregators can determine the
generation resources used to serve their customers.
(i) In making the determination pursuant to subdivision (h), the
commission may consider a centralized resource adequacy mechanism
among other options.
(j) For purposes of this section, "load-serving entity" means an
electrical corporation, electric service provider, or community
choice aggregator. "Load-serving entity" does not include any of the
following:
(1) A local publicly owned electric utility.
(2) The State Water Resources Development System commonly known as
the State Water Project.
(3) Customer generation located on the customer's site or
providing electric service through arrangements authorized by Section
218, if the customer generation, or the load it serves, meets one of
the following criteria:
(A) It takes standby service from the electrical corporation on a
commission-approved rate schedule that provides for adequate backup
planning and operating reserves for the standby customer class.
(B) It is not physically interconnected to the electric
transmission or distribution grid, so that, if the customer
generation fails, backup electricity is not supplied from the
electricity grid.
(C) There is physical assurance that the load served by the
customer generation will be curtailed concurrently and commensurately
with an outage of the customer generation.