BILL NUMBER: AB 40	INTRODUCED
	BILL TEXT


INTRODUCED BY   Assembly Member Fuentes

                        DECEMBER 1, 2008

   An act to amend Section 728.1 of the Public Utilities Code,
relating to electricity.


	LEGISLATIVE COUNSEL'S DIGEST


   AB 40, as introduced, Fuentes. Electricity: rates: plant held for
future use account.
   Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including electrical corporations.
Existing law authorizes the commission to fix the rates and charges
for every public utility, and requires that those rates and charges
be just and reasonable. Existing law authorizes the commission to
establish rules, and prescribe a uniform system of accounts, for all
public utilities. Pursuant to this authority, the commission has
adopted a uniform system of accounts for public utilities and
licensees, including an account for plant held for future use, and
established guidelines for the account. Existing law requires the
commission to review the status of all property of a gas or
electrical corporation carried in its plant held for future use
account at least once every 3 years or during a ratemaking
proceeding, for purposes of fixing the rates of the gas or electrical
corporation, and prescribes the manner in which gain accruing from
the sale of property held in the account is to be allocated between
the utility and ratepayers.
   This bill would make a nonsubstantive clarifying change to
existing law relative to how gain accruing from the sale of property
carried in the plant held for future use account is to be allocated
between the gas or electrical corporation and ratepayers.
   Existing law requires the State Energy Resources Conservation and
Development Commission (Energy Commission) to adopt a strategic plan
for the state's electric transmission grid and requires that the plan
identify and recommend actions required to implement investments
needed to ensure reliability, relieve congestion, and to meet future
growth in load and generation. Existing law authorizes the Energy
Commission to designate a transmission corridor zone on its own
motion or by application of a person that plans to construct a
high-voltage electric transmission line within the state and provides
that the designation of a transmission corridor zone shall serve to
identify a feasible corridor where a future transmission line can be
built that is consistent with the state's needs and objectives as set
forth in the strategic plan adopted by the Energy Commission.
   This bill would require the commission to review its guidelines
for the plant held for future use account and determine whether it
needs to open a proceeding to adjust the time period allowed for a
property to be held in the account. The bill would require the
commission to consider whether it should amend the guidelines, or add
a separate guideline to allow a distinct time period for real
property located within a transmission corridor zone designated by
the Energy Commission. The bill would require that if the commission
amends the existing guidelines, or adds a separate guideline,
pursuant to the bill's requirements, that the commission ensure that
any gains or losses from the sale or reassignment of any interest in
real property acquired by the electrical corporation that is subject
to the amended or new guideline, are allocated between customers and
shareholders proportionately to the risks involved.
   Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: no.


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

  SECTION 1.  Section 728.1 of the Public Utilities Code is amended
to read:
   728.1.  (a) For purposes of this section, "plant held for future
use account" means account number 105 of the Uniform System of
Accounts Prescribed for Public Utilities and Licensees, as adopted by
the commission.
   (b) The commission shall review the status of all property owned
by a gas or electrical corporation and  held  
carried  within the plant held for future use account at least
once every three years or during a proceeding conducted pursuant to
Section 728, for the purpose of determining and fixing the rates of
that gas or electrical corporation, as determined by the commission.
   (c) If a gas or electrical corporation sells property which was
carried within the plant held for future use account and which was
included in determining the rates of the corporation, the commission
shall determine what portion of any gains from the sale shall be
allocated to the customers of the corporation in a manner consistent
with the procedures specified in account number 105 of the Uniform
System of Accounts Prescribed for Public Utilities and Licensees. The
portion of the gains allocated to customers shall not be less than
the amount the corporation has recovered through rates for the
carrying costs and other expenses of the property during the period
it was carried in the plant held for future use  account  ,
and shall not exceed the gain on the sale, net of any tax, resulting
from the sale.
  SEC. 2.  The commission shall review its Plant Held for Future Use
Guidelines and determine whether it needs to open a proceeding to
adjust the time period allowed for a property to be carried in the
plant held for future use account. The commission shall consider
whether it should amend the guidelines, or add a separate guideline
to allow a distinct time period for real property located within a
transmission corridor zone designated by the State Energy Resources
Conservation and Development Commission pursuant to Chapter 4.3
(commencing with Section 25330) of Division 15 of the Public
Resources Code. If the commission amends the existing guidelines, or
adds a separate guideline, pursuant to this section, the commission
shall ensure that any gains or losses from the sale or reassignment
of any interest in real property acquired by the electrical
corporation that is subject to the amended or new guideline, are
allocated between customers and shareholders proportionately to the
risks involved.