BILL ANALYSIS �
SB 656
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Date of Hearing: August 14, 2013
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Mike Gatto, Chair
SB 656 (Wright) - As Amended: August 6, 2013
Policy Committee: Utilities and
Commerce Vote: 13-0
Urgency: No State Mandated Local Program:
Yes Reimbursable: No
SUMMARY
This bill suspends a requirement for the Public Utilities
Commission (PUC) to maintain specified consumer information and
establishes registration requirements for core transport agents.
Specifically, this bill:
1)Delays various PUC direct access requirements until
competitive residential electricity service becomes available,
including a requirement to issue public alerts about entities
providing electrical service in an unauthorized or fraudulent
manner.
2)Repeals a requirement for the PUC to direct the
Division/Office of Ratepayer Advocates to publish
informational guides or other tools to help residential and
small commercial customers evaluate competing electric service
options.
3)Establishes a requirement for competitive natural gas service
providers who market to residential and small commercial
customers to register with the PUC and meet specified
requirements.
4)Provides gas customers may seek remedies through the PUC or
the judicial system to resolve complaints.
5)Requires the PUC to issue public alerts about entities
providing natural gas service in an unauthorized or fraudulent
manner and act on customer complaints.
6)Requires the PUC to direct the Division/Office of Ratepayer
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Advocates to publish informational guides or other tools to
help residential and small commercial customers evaluate
competing natural gas service providers.
FISCAL EFFECT
1)Increased costs of approximately $200,000 to the PUC from the
Public Utilities Reimbursement Account (PURA) to develop and
implement registration requirements, compile data and create
educational materials for Core Transport Agents.
The PUC is authorized to collect a registration fee and adjust
the fee as necessary to recover the cost of administering the
program.
1)Purpose. This bill delays requirements for the PUC and
Division/Office of Ratepayer Advocates to collect data and
develop informational guides for the direct access electricity
program until the program is operational. This bill also adds
regulatory oversight and for the optional Core Gas Aggregation
Service program.
2)Direct Access Electricity. Direct access is a system that
allows customers of an electrical corporation to purchase
electricity directly from wholesale sellers and use the
electrical corporation only for distribution and transmission
services. The electricity crisis of 2001 resulted in a
suspension of the program but any customer enrolled at the
time was permitted to remain with their electricity provider.
As of March 15, 2013 utility reports indicate that statewide
there are currently 11,120 residential and 17,307 small
commercial (non-residential) customers subscribed to direct
access electricity contracts.
3)Third-Party Natural Gas Providers. In 1999, AB 1421 (Wright,
Chapter 909, Statutes of 2000) authorized customers to
purchase natural gas from an entity other than a gas
corporation. Core Gas Aggregation Service is the optional
program that allows residential or business customers to
purchase natural gas from Core Transport Agents (third-party
gas suppliers). Through this program, the gas corporation
continues to read the meter and deliver gas to the customer.
Non-utility natural gas suppliers are not regulated by the
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PUC. If a customer has a complaint against a non-utility
natural gas supplier, it may not be possible for the PUC to
resolve the complaint with the non-utility supplier. The PUC
requires, but does not enforce, core gas aggregators to follow
utility gas rules.
According to the most recent Energy Information Administration
data, 34,391 residential customers in California purchase gas
from marketers, representing about 0.7 percent of deliveries
to residential consumers statewide in 2008.
4)Customer Complaints . PG&E has investigated approximately
1,200 Core Transport Agents- related complaints from customers
in the last 15 months, including complaints about unauthorized
switches to different providers, cancellation requests, and
deceptive practices.
This bill requires the PUC, instead of gas corporations,
investigate and resolve these types of complaints.
5)Division/Office of Ratepayer Advocates . This bill requires
the PUC to direct the Division/Office of Ratepayer Advocates
to collect and analyze registration information and produce
easily understandable informational brochures designed to help
all customers evaluate competing natural gas service options.
The Division/Office has requested amendments to instead
require the PUC to collect and analyze registration
information. In the proposed amendments, the Division/Office
of Ratepayers Advocates would instead analyze and collect
customer complaints. The author may wish to consider these
and other technical amendments while the bill is on the
Suspense File.
Analysis Prepared by : Jennifer Galehouse / APPR. / (916)
319-2081