BILL ANALYSIS Ó
AB 2381
Page 1
Date of Hearing: May 18, 2016
ASSEMBLY COMMITTEE ON APPROPRIATIONS
Lorena Gonzalez, Chair
AB
2381 (Roger Hernández) - As Amended April 26, 2016
-----------------------------------------------------------------
|Policy |Utilities and Commerce |Vote:|14 - 0 |
|Committee: | | | |
| | | | |
| | | | |
-----------------------------------------------------------------
Urgency: No State Mandated Local Program: YesReimbursable:
No
SUMMARY:
This bill requires the Public Utilities Commission (PUC) to
direct electric utilities to establish utility service guarantee
programs (SGPs), on or before July 1, 2018, to automatically
provide each customer a $30 bill credit for each continuous
24-hour period that the customer is without power.
Specifically, this bill:
AB 2381
Page 2
1)Specifies the bill credit is not an exclusive remedy and does
not affect any other relief or remedy provided by law.
2)Requires electric corporations to engage in public outreach to
increase awareness of the program.
3)Requires shareholders to exclusively bear the cost of their
service guarantee programs, rather than ratepayers.
4)Allows an electrical corporation that has a program to provide
bill credits for outages prior to January 1, 2017 to update
its program to comply with the bill rather than create a new
program.
5)Requires electric corporations to report to the Legislature,
on or before July 2, 2019, and annually thereafter, on the
number of customers provided a bill credit and the total
amount credited to customers through these service guarantee
programs.
6)Specifies that the program requirement does not apply to
outages under any of the following circumstances:
a) The outage is planned and for maintenance.
b) The outage is caused by a moderate, severe, or
catastrophic storm condition.
c) The facilities, lines, equipment, or other property
necessary to restore power are inaccessible or are deemed
unsafe to access.
AB 2381
Page 3
d) The outage occurs during a declared emergency event
or cause related to an extraordinary event or
circumstance beyond the control of the electric
corporation (force majeure).
e) The affected service location is vacant.
FISCAL EFFECT:
Increased costs for the PUC estimated between approximately
$50,000 to $170,000 depending upon whether the implementation
and modification of the SGPs are done through Advice Letter or
through a proceeding (Public Utilities Commission Utilities
Fund).
This bill requires the PUC to establish new utility service
guarantee programs for San Diego Gas & Electric (SDG&E) and Bear
Valley Electric Services (BVES); and to modify existing service
guarantee programs for Pacific Gas & Electric (PG&E), Southern
California Edison (SCE), and PacifiCorp.
COMMENTS:
AB 2381
Page 4
1)Purpose. According to the author, two utility companies have
existing automatic bill credit programs that offer some relief
for customers without power for extended periods of time.
This bill builds off the success of these programs and extends
requirements to all electric corporations.
2)Background. Power outages are not an uncommon occurrence and
can sometimes last a few hours to a few days. Such outages
not only create an inconvenience for residents and businesses,
but can also cause health and safety issues, as well as
economic damages to businesses and communities. Under current
law, the CPUC is required to adopt inspection, maintenance,
repair, and replacement standards for electric distribution
systems, as well as standards for operation, reliability, and
safety during periods of emergency and disaster.
In most cases, electric utilities provide businesses and
residents reimbursements if they suffered a loss or damage due
to a service interruption as a result of the utility.
Utilities judge each claim individually. For example,
according to SCE's website, SCE evaluates each claim
individually, and determines: a) if loses occurred due to
their negligence; b) how the incident happened; c) the extent
of damages; and d) what the law considers fair compensation.
Customers must submit proof and documentation to verify their
claims along with the application.
3)Existing Service Guarantee Programs. The PUC adopted Decision
(D.) 00-02-046 in PG&E'sTest Year (TY) 1999 General Rate Case
(GRC) proceeding to create PG&E's Quality Assurance Program
(QA Program). It was later modified by D.04-05-055 in its TY
2003 GRC proceeding and in D.07-03-044 in its TY 2007 GRC
proceeding. D.04-05-055 adopted a settlement between PG&E and
the Office of Ratepayer Advocates (ORA) that established a $30
bill credit for any failure to meet the quality service
AB 2381
Page 5
standards. Standard 7 of the QA Program pertains to
restoration of services within 24 hours. PG&E reports
quarterly to the PUC on credits paid to customers.
The PUC adopted D.04-07-022 in SCE's Test Year (TY) 2003 GRC
proceeding to create SCE's Service Guarantee Program. Under
SCE's current SGP, SCE provides a $30 bill credit for each
24-hour period that a customer is without service. SCE
reports annually to the PUC on credits paid to customers.
----------------------------------------------------------------------
|PacifiCorp's SGP went into effect on July 1, 2001, after its merger |
|with Scottish Power. Electric Rule 25 and Tariff Schedule 300 |
|require PacifiCorp to provide a customer $50 bill credit for failure |
|to restore electric supply within 24 hours after being notified and |
|$25 bill credit for each additional 12 hours of power outage. To |
|receive the bill credit, a customer must make a claim for |
|compensation within 30 calendar days of the date of the outage. |
|PacifiCorp reports annually to the PUC on credits paid to customers. |
| |
| |
| |
| |
----------------------------------------------------------------------
4)Related Legislation. AB 1800 (Hadley) requires an electric
utility to post specified information relating to utility
outage compensation claims on its Internet Web site. This
bill is in this Committee's Suspense file.
Analysis Prepared by:Jennifer Galehouse / APPR. / (916)
319-2081
AB 2381
Page 6