BILL ANALYSIS Ó
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THIRD READING
Bill No: AB 2672
Author: Perea (D)
Amended: 8/20/14 in Senate
Vote: 21
SENATE ENERGY, UTILITIES & COMMUNICATIONS COMM : 8-2, 6/23/14
AYES: Padilla, Cannella, Corbett, De León, DeSaulnier, Hill,
Pavley, Wolk
NOES: Fuller, Knight
NO VOTE RECORDED: Block
SENATE APPROPRIATIONS COMMITTEE : 5-0, 8/14/14
AYES: De León, Hill, Lara, Padilla, Steinberg
NO VOTE RECORDED: Walters, Gaines
ASSEMBLY FLOOR : 61-7, 5/29/14 - See last page for vote
SUBJECT : Access to energy: disadvantaged communities: San
Joaquin Valley
SOURCE : Leadership Counsel for Justice and Accountability
Self-Help Enterprises
DIGEST : This bill requires the California Public Utilities
Commission (PUC) by March 31, 2015, to initiate a new proceeding
to identify disadvantaged communities in the San Joaquin Valley
meeting specified requirements and to analyze economically
feasible options to increase access to affordable energy in
those disadvantaged communities.
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Senate Floor Amendments of 8/20/14 clarify the definition of
disadvantaged community and state that instead of an
investor-owned utility identifying those communities, the PUC
will do so within a new proceeding.
ANALYSIS : Existing law:
1.Requires the PUC to establish the California Alternate Rates
for Energy (CARE) program to discount rates for low-income gas
and electric customers whom are defined as those with incomes
no greater than 200 percent of the federal poverty level. The
average effective CARE discount is limited to a range of 30 to
35 percent of the revenues that would have been produced for
the same billed usage by non-CARE customers.
2.Requires the PUC to make specific written findings if it
considers the extension of gas service to new or existing
customers.
Current orders of the PUC require that the costs of gas main or
pipeline extensions to serve new or existing customers be borne
by the customer or project developer.
This bill:
1.Requires, no later than March 31, 2015, the PUC to initiate a
new proceeding to do all of the following:
A. Identify disadvantaged communities based on specified
criteria.
B. Analyze the economic feasibility of the following
options:
Extending natural gas pipelines to those
disadvantaged communities.
Increasing subsidies for electricity for residential
customers in those disadvantaged communities.
Other alternatives that will increase access to
affordable energy in those disadvantaged communities that
the PUC deems appropriate.
1.Requires the PUC to determine whether any of the options
analyzed in the proceeding will increase access to affordable
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energy in a cost-effective manner. For these options, the PUC
will be required to take appropriate action and determine
appropriate funding sources.
2.Defines "Disadvantaged community" to mean a San Joaquin Valley
community that meets all of the following criteria:
A. At least 25% of residential households with electrical
service are enrolled in the CARE.
B. Has a population greater than 100 persons within its
geographic boundaries as identified by the most recent
United States Census or a community survey.
C. Has geographic boundaries no farther than seven miles
from the nearest natural gas pipeline operated by a gas
corporation.
1.Defines "San Joaquin Valley" to mean the counties of Fresno,
Kern, Kings, Madera, Merced, San Joaquin, Stanislaus, and
Tulare.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee:
Annual costs of at least $300,000 from the Public Utilities
Reimbursement Account (special) for two years to the PUC for
the cost of a proceeding.
Unknown costs, possibly in hundreds of thousands, to the
General Fund and various special funds to the state as a
ratepayer for the state's cost share of subsidies or necessary
infrastructure to provide access to affordable energy in the
San Joaquin Valley.
SUPPORT : (Verified 8/21/14)
Leadership Counsel for Justice and Accountability (co-source)
Self-Help Enterprises (co-source)
Allensworth Community Services District
Allensworth Elementary School District
California State Association of Electrical Workers
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California State Pipe Trades Council
Center on Race, Poverty & the Environment
City of Mendota
Fairmead Community & Friends
Monterey Park Tract Community Services District
West Goshen Mutual Water Company
Western State Council of Sheet Metal Workers
ARGUMENTS IN SUPPORT : According to the author, this bill
requires a gas corporation that provides natural gas in the
Valley to identify communities without gas service by January
31, 2015. It requires the PUC to initiate a new proceeding to
conduct an affordable energy feasibility study by March 31, 2015
for the identified communities without gas service and it would
require the PUC to determine if any options in the study would
increase access to affordable energy.
Many disadvantaged communities in the San Joaquin Valley do not
enjoy the benefits of an affordable energy service such as
natural gas. Gas lines simply do not extend into their
communities and they must choose among more costly, less
convenient and more potentially hazardous fuels to heat their
homes, their water, and their food. Other fuels such as
propane, wood and electricity are more costly and less
environmentally friendly and leave residents more prone to
health and safety issues.
Communities that wish to transition to a more affordable energy
source often times don't have the resources to pay for projects
without financing the project over time. Currently, there is no
program within the PUC to enable communities to understand the
costs associated with transitioning to an affordable energy
source. There is also no program to help identify potential
funding sources available to assist with affordable energy
projects.
ASSEMBLY FLOOR : 61-7, 5/29/14
AYES: Alejo, Ammiano, Bigelow, Bloom, Bocanegra, Bonilla, Bonta,
Bradford, Brown, Buchanan, Ian Calderon, Campos, Chau, Chávez,
Chesbro, Cooley, Dababneh, Daly, Dickinson, Eggman, Fong, Fox,
Frazier, Garcia, Gatto, Gomez, Gonzalez, Gordon, Gray, Grove,
Hall, Roger Hernández, Holden, Jones-Sawyer, Levine,
Lowenthal, Maienschein, Medina, Mullin, Muratsuchi, Nazarian,
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Nestande, Olsen, Pan, Perea, John A. Pérez, V. Manuel Pérez,
Quirk, Quirk-Silva, Rendon, Ridley-Thomas, Rodriguez, Salas,
Skinner, Stone, Ting, Weber, Wieckowski, Williams, Yamada,
Atkins
NOES: Allen, Donnelly, Hagman, Jones, Linder, Mansoor, Waldron
NO VOTE RECORDED: Achadjian, Conway, Dahle, Beth Gaines, Gorell,
Harkey, Logue, Melendez, Patterson, Wagner, Wilk, Vacancy
JG:nl 8/21/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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