BILL NUMBER: AB 853	AMENDED
	BILL TEXT

	AMENDED IN SENATE  SEPTEMBER 1, 2015
	AMENDED IN SENATE  AUGUST 18, 2015
	AMENDED IN ASSEMBLY  APRIL 30, 2015
	AMENDED IN ASSEMBLY  MARCH 24, 2015

INTRODUCED BY   Assembly Member Roger Hernández

                        FEBRUARY 26, 2015

   An act to add Section 764 to the Public Utilities Code, relating
to energy.



	LEGISLATIVE COUNSEL'S DIGEST


   AB 853, as amended, Roger Hernández. Electrical and gas
corporations: security of plant and facilities.
   Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including electrical corporations
and gas corporations, as defined. If the commission finds after a
hearing that the rules, practices, equipment, appliances, facilities,
or service of any public utility, or of the methods of manufacture,
distribution, transmission, storage, or supply employed by the public
utility, are unjust, unreasonable, unsafe, improper, inadequate, or
insufficient, the Public Utilities Act requires that the commission
determine and, by order or rule, fix the rules, practices, equipment,
appliances, facilities, service, or methods to be observed,
furnished, constructed, enforced, or employed. The Public Utilities
Act requires the commission to prescribe rules for the performance of
any service or the furnishing of any commodity of the character
furnished or supplied by any public utility and, on proper demand and
tender of rates, require the public utility to furnish the commodity
or render the service within the time and upon the conditions
provided in the rules adopted by the commission.
   This bill would  , on and after the filing of an electrical
corporation's or gas corporation's general rate case application,
 require  an   that  electrical
corporation or gas corporation  , except as provided,  to
utilize  direct employees, as defined,  
employees of that corporation  for any work associated with the
design, engineering, and operation of its nuclear, electrical, and
gas infrastructure, including all computer and information technology
systems, unless the utility files a request to employ persons that
are not  direct  employees with the commission
 an application in   as a part of  the
utility's general rate  case.   case
application.  The bill would require that the request be a
separate stand-alone section that is not embedded in the general
requested staffing change proposals. The bill would require the
utility to demonstrate that the work can be performed safely and
securely, and without jeopardizing the security of its nuclear,
electrical, and gas infrastructure, by persons that are not 
direct  employees. The bill would require the commission to
evaluate the utility's proposal to utilize persons that are not
 direct  employees. The bill would require the
commission to issue a written decision, as part of the general rate
case proceeding, determining whether the electrical corporation or
gas corporation may utilize persons that are not  direct
 employees for the described work.
   Under existing law, a violation of the Public Utilities Act or any
order, decision, rule, direction, demand, or requirement of the
commission is a crime.
   Because the provisions of this bill would be a part of the act and
because a violation of an order or decision of the commission
implementing its requirements would be a crime, the bill would impose
a state-mandated local program by creating a new crime.
   The California Constitution requires the state to reimburse local
agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
   This bill would provide that no reimbursement is required by this
act for a specified reason.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:

   SECTION 1   .    The Legislature finds and
declares all of the following:  
   (a) Protecting the security of nuclear, electrical, and natural
gas utility systems is a paramount state interest.  
   (b) Protecting the privacy of ratepayers' personal information,
including usage information, is a paramount state interest. 

   (c) Recent intrusions into major corporate computer systems,
including Sony and Anthem Blue Cross, and the theft of information
from those systems have demonstrated the vulnerability of those
systems.  
   (d) The computer systems of California's electrical corporations
and gas corporations have information about the design, engineering,
and operation of the nuclear, electrical, and natural gas utility
infrastructure, as well as personal information about California
ratepayers. This information could be used to compromise the security
of California's utility infrastructure and the privacy of California'
s ratepayers.  
   (e) Widespread deployment of smart meters, smart grid equipment,
and microgrids increases the importance of protecting the computer
systems of electrical corporations and gas corporations.  
   (f) The part of any computer system that is most vulnerable to
being compromised is the personnel who operate that system. 

   (g) Electrical corporations and gas corporations should make every
reasonable effort to protect their computer systems from
unauthorized intrusions.  
   (h) To protect the security of electrical and natural gas utility
computer systems, including nuclear infrastructure, the information
technology personnel who operate those systems should be employees of
the electrical corporation or gas corporation.  
   (i) To protect the security of nuclear, electrical, and gas
utility infrastructure, the design, engineering, and operation of
that infrastructure should, to the extent feasible, be performed by
employees of the electrical corporation or gas corporation. 
   SECTION 1.   SEC. 2.   Section 764 is
added to the Public Utilities Code, to read:
   764.  (a)  The Legislature finds and declares all of the
following:   An electrical corporation or gas
corporation shall utilize   employees   of the
electrical corporation or gas corporation for any work associated
with the design, engineering, and operation of its nuclear,
electrical, and gas infrastructure, including all computer and
information technology systems, unless the utility complies with the
requirements of this section and obtains the   approval of
the commission pursuant to this section.  
   (1) Protecting the security of nuclear, electrical, and natural
gas utility systems is a paramount state interest.  

   (2) Protecting the privacy of ratepayers' personal information,
including usage information, is a paramount state interest. 

   (3) Recent intrusions into major corporate computer systems,
including Sony and Anthem Blue Cross, and the theft of information
from those systems have demonstrated the vulnerability of those
systems.  
   (4) The computer systems of California's electrical corporations
and gas corporations have information about the design, engineering,
and operation of the nuclear, electrical, and natural gas utility
infrastructure, as well as personal information about California
ratepayers. This information could be used to compromise the security
of California's utility infrastructure and the privacy of California'
s ratepayers.  
   (5) Widespread deployment of smart meters, smart grid equipment,
and microgrids increases the importance of protecting the computer
systems of electrical corporations and gas corporations. 

   (6) The part of any computer system that is most vulnerable to
being compromised is the personnel who operate that system. 

   (7) Electrical corporations and gas corporations should make every
reasonable effort to protect their computer systems from
unauthorized intrusions.  
   (8) To protect the security of electrical and natural gas utility
computer systems, including nuclear infrastructure, the information
technology personnel who operate those systems should be direct
employees of the electrical corporation or gas corporation. 

   (9) To protect the security of nuclear, electrical, and gas
utility infrastructure, the design, engineering, and operation of
that infrastructure should, to the extent feasible, be performed by
direct employees of the electrical corporation or gas corporation.
 
   (b) For purposes of this section, "direct employees" for
construction or maintenance work include the employees of a
contractor or subcontractor licensed in California and working under
the direct supervision of the electrical corporation or gas
corporation.  
   (c) An electrical corporation or gas corporation shall utilize
direct employees for any work associated with the design,
engineering, and operation of its nuclear, electrical, and gas
infrastructure, including all computer and information technology
systems, unless the utility complies with the requirements of this
section and obtains the approval of the commission pursuant to this
section.  
   (d) 
    (b)  Before utilizing persons that are not 
direct  employees  of the electrical corporation or gas
corporation  for work associated with the design, engineering,
and operation of its nuclear, electrical, and gas infrastructure,
including all computer and information technology systems, an
electrical corporation or gas corporation shall file a request to
employ persons that are not  direct  employees with
the commission, as part of the utility's general rate case
application. The request shall be a separate stand-alone section that
is not embedded in the general requested staffing change proposals.
The utility shall demonstrate that the work can be performed safely
and securely, and without jeopardizing the security of its nuclear,
electrical, and gas infrastructure. 
   (e) 
    (c)  The commission shall evaluate the utility's
proposal to utilize persons that are not  direct 
employees  of the electrical corporation or gas corporation 
for work associated with the design, engineering, and operation of
its nuclear, electrical, and gas infrastructure, including all
computer and information technology systems. 
   (f) 
    (d)  The commission shall issue a written decision as
part of the general rate case proceeding determining whether the
electrical corporation or gas corporation may utilize persons that
are not  direct  employees  of the electrical or
gas corporation  for the described work. 
   (g) 
    (e)  A person or corporation owning or operating a
qualifying facility pursuant to federal law or a facility that is an
exempt wholesale generator is not an electrical corporation due to
the ownership or operation of that facility. This subdivision is
declaratory of existing law. 
   (f) The requirements of this section are applicable only to
electrical corporations or gas corporations that file general rate
cases with the commission.  
   (g) (1) This section does not apply to an electrical corporation
or gas corporation contracting out construction, alteration,
demolition, installation, maintenance, or repair work on its nuclear,
electrical, or gas infrastructure.  
   (2) This section does not apply to the design and engineering of
standard equipment purchased from an outside vendor.  
   (3) For each electrical or gas corporation, this section shall
become effective for that corporation upon the filing, on or after
January 1, 2016, of that corporation's general rate case application.

   SEC. 2.   SEC. 3.   No reimbursement is
required by this act pursuant to Section 6 of Article XIII B of the
California Constitution because the only costs that may be incurred
by a local agency or school district will be incurred because this
act creates a new crime or infraction, eliminates a crime or
infraction, or changes the penalty for a crime or infraction, within
the meaning of Section 17556 of the Government Code, or changes the
definition of a crime within the meaning of Section 6 of Article XIII
B of the California Constitution.