BILL ANALYSIS 1
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SENATE ENERGY, UTILITIES AND COMMUNICATIONS COMMITTEE
ALEX PADILLA, CHAIR
AB 698 - Skinner Hearing Date:
June 30, 2009 A
As Amended: April 21, 2009 FISCAL B
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DESCRIPTION
Current law requires the California Public Utilities Commission
(CPUC) to approve a transfer of utility property valued at less
than $5 million by a resolution voted upon by the CPUC
commissioners.
This bill relaxes that requirement by allowing the CPUC staff to
approve the transfer without a vote of the commissioners if the
proposal is valued at less than $5 million and is uncontested.
Current law states legislative intent that the CPUC maintain all
of its oversight and review responsibilities with regard to the
California Environmental Quality Act (CEQA), and that transfers
of utility property that require a CEQA review should not
qualify for expedited review.
This bill relaxes that requirement by allowing the CPUC to
consider the transfer of utility property under an expedited
process if the CPUC is the responsible agency and if the lead
agency has completed the appropriate CEQA review, though the
approval is subject to a vote by the CPUC commissioners.
BACKGROUND
Reviewing and approving public utility asset sales ensures that
utilities retain the assets that are necessary for delivery of
high quality service. If assets are sold, this process ensures
that the utility and its ratepayers are fairly compensated.
These types of reviews are among the most common formal
proceedings before the CPUC.
The mechanism for reviewing and approving asset sales was
streamlined in 2005 (AB 736 - Horton: Chapter 370) so that for
utility transactions valued at less than $5 million, the CPUC
could approve the transaction using an advice letter process and
must render a decision within 120 days. Transactions valued at
more than $5 million must be processed using a more formal
application process wherein an administrative law judge is
assigned the case and there are more opportunities for public
testimony and briefing. The 2005 reform also stated legislative
intent that expedited reviews (e.g. advice letters) should not
be permitted when a CEQA review was required.
COMMENTS
1. Under the terms of its 2001 bankruptcy settlement, PG&E
will provide conservation easements on 142,000 acres of
hydroelectric watershed and other lands to public agencies
or land conservation groups. These easements must be
approved by the CPUC. Under current law and CPUC practice
PG&E will be required to file applications for approval, a
much more formal, legalistic and lengthy process that
provides more opportunities for public input and debate.
This bill will permit PG&E to seek approval using a less
formal advice letter process, provided that the necessary
CEQA review is performed by the appropriate lead agency. A
vote of the commission on the advice letter would still be
required.
2. Allowing the CPUC to approve uncontested property
transfers at the staff level rather than by a vote of the
commissioners will reduce the approval time by a month or
two. PG&E believes that it will need to transfer
potentially hundreds of easements, most of which should be
eligible for the expedited staff review and approval. The
advice letter process requires PG&E to provide notice to
interested parties of the advice letter. Given the large
number of transfers, interested parties will need to be
alert.
ASSEMBLY VOTES
Assembly Floor (73-0)
Assembly Appropriations Committee (16-0)
Assembly Natural Resources Committee
(9-0)
Assembly Utilities and Commerce Committee
(13-0)
POSITIONS
Sponsor:
Pacific Gas and Electric Company
Support:
California Public Utilities Commission
Southern California Edison
Oppose:
None on file
Randy Chinn
AB 698 Analysis
Hearing Date: June 30, 2009