BILL ANALYSIS Ó
-----------------------------------------------------------------
|SENATE RULES COMMITTEE | SB 900|
|Office of Senate Floor Analyses | |
|1020 N Street, Suite 524 | |
|(916) 651-1520 Fax: (916) | |
|327-4478 | |
-----------------------------------------------------------------
UNFINISHED BUSINESS
Bill No: SB 900
Author: Hill (D)
Amended: 7/1/14
Vote: 21
SENATE ENERGY, UTIL. & COMMUNIC. COMM. : 9-0, 4/1/14
AYES: Padilla, Fuller, Cannella, Corbett, DeSaulnier, Hill,
Knight, Pavley, Wolk
NO VOTE RECORDED: Block, De León
SENATE APPROPRIATIONS COMMITTEE : 7-0, 5/23/14
AYES: De León, Walters, Gaines, Hill, Lara, Padilla, Steinberg
SENATE FLOOR : 35-0, 5/28/14
AYES: Anderson, Beall, Berryhill, Block, Cannella, Corbett,
Correa, De León, DeSaulnier, Evans, Fuller, Gaines, Galgiani,
Hernandez, Hill, Hueso, Huff, Jackson, Knight, Lara, Leno,
Lieu, Mitchell, Monning, Morrell, Nielsen, Padilla, Pavley,
Roth, Steinberg, Torres, Vidak, Walters, Wolk, Wyland
NO VOTE RECORDED: Calderon, Hancock, Liu, Wright, Yee
ASSEMBLY FLOOR : 78-0, 8/14/14 (Consent) - See last page for
vote
SUBJECT : Public utilities
SOURCE : Author
DIGEST : This bill requires the Public Utilities Commission
(PUC) to consider safety in electrical and gas rate cases.
CONTINUED
SB 900
Page
2
Assembly Amendments add economic effects as part of the PUC
assessment.
ANALYSIS :
Existing law:
1. Requires that the PUC and each gas corporation place safety
of the public and gas corporation employees as the top
priority and further requires that PUC take all reasonable
and appropriate actions necessary to carry out safety as a
priority consistent with the principle of just and reasonable
cost-based rates.
2. Requires, in any ratemaking proceeding in which the PUC
authorizes a gas corporation to recover expenses for the
maintenance and repair of transmission pipelines, that the
PUC require the gas corporation to establish and maintain a
balancing account for the recovery of those expenses.
3. Defines quasi-legislative proceedings as those that establish
policy including rulemakings and investigations which may
establish rules affecting an entire industry.
This bill:
1.Requires the PUC to develop formal procedures to consider
safety in electrical and gas rate cases. Requires the
procedures include a means by which safety information
acquired by the PUC through monitoring, data tracking and
analysis, accident investigations, and audits of an
applicant's safety programs may inform the PUC's consideration
of the application.
2.Requires the PUC to take all necessary and appropriate actions
to assess the economic effects of its decisions and mitigate
the impacts of its decisions on customer, public, and employee
safety.
Background
The Independent Review Panel that studied the San Bruno
explosion found in June of 2011 that safety had not been
CONTINUED
SB 900
Page
3
effectively included in the PUC decision-making.
An October 2013 report by the Senate Subcommittee on Gas and
Electric Infrastructure Safety, Slow Progress Toward Safety:
Improving Performance and Priorities in the Safety Plans of the
PUC, found that the PUC had yet to incorporate procedures to
include safety considerations into utility rate cases and its
proceedings generally.
To include safety into utility rate cases, the PUC opened a
rulemaking in November 2013 to change its rate case plan.
In order to ensure that a utility is accountable for its
proposed expenditures for risk mitigation, this bill requires
the PUC to incorporate safety information gleaned from the PUC's
audits, accident investigations, and other compliance work into
its consideration of rate cases.
The PUC has not been able to include safety considerations into
its proceedings generally. A February 2013 survey report had
found that PUC employees had not been convinced of the agency's
commitment to safety. One employee noted, "There are no
existing mechanisms for inserting safety concerns into the
record. Often, when safety is considered in a case proceeding
it is at the end of the process, when it is too late to make
necessary changes."
Comment
According to the author's office, over the last two years, the
PUC has recognized the need to include safety in its
proceedings. However, the development of effectiveness
procedures for addressing safety so far has been slow. This
bill ensures the PUC will integrate safety information in its
rate cases and general decision making proceedings.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: No
According to the Senate Appropriations Committee, annual costs
up to $1 million from the PUC Utilities Reimbursement Account
(special) for increased safety analysis in ratesetting cases.
SUPPORT : (Verified 8/14/14)
CONTINUED
SB 900
Page
4
Office of Ratepayer Advocates
ASSEMBLY FLOOR : 78-0, 8/14/14
AYES: Achadjian, Alejo, Allen, Ammiano, Bigelow, Bloom,
Bocanegra, Bonilla, Bonta, Bradford, Brown, Buchanan, Ian
Calderon, Campos, Chau, Chávez, Chesbro, Conway, Cooley,
Dababneh, Dahle, Daly, Dickinson, Donnelly, Eggman, Fong, Fox,
Frazier, Beth Gaines, Garcia, Gatto, Gomez, Gonzalez, Gordon,
Gorell, Gray, Grove, Hagman, Hall, Harkey, Holden, Jones,
Jones-Sawyer, Levine, Linder, Logue, Lowenthal, Maienschein,
Mansoor, Medina, Melendez, Mullin, Muratsuchi, Nazarian,
Nestande, Olsen, Pan, Patterson, Perea, John A. Pérez, V.
Manuel Pérez, Quirk, Quirk-Silva, Rendon, Ridley-Thomas,
Rodriguez, Salas, Skinner, Stone, Ting, Wagner, Waldron,
Weber, Wieckowski, Wilk, Williams, Yamada, Atkins
NO VOTE RECORDED: Roger Hernández, Vacancy
JG:d 8/14/14 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
**** END ****
CONTINUED