BILL ANALYSIS �
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|SENATE RULES COMMITTEE | SB 705|
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THIRD READING
Bill No: SB 705
Author: Leno (D)
Amended: 5/5/11
Vote: 21
SENATE ENERGY, UTILITIES & COMM. COMMITTEE : 9-0, 4/28/11
AYES: Padilla, Fuller, Corbett, De Le�n, DeSaulnier,
Pavley, Rubio, Simitian, Wright
NO VOTE RECORDED: Berryhill, Strickland
SENATE APPROPRIATIONS COMMITTEE : 6-2, 5/26/11
AYES: Kehoe, Alquist, Lieu, Pavley, Price, Steinberg
NOES: Walters, Runner
NO VOTE RECORDED: Emmerson
SUBJECT : Natural gas: service and safety
SOURCE : The Utility Reform Network
Utility Workers Union of America
DIGEST : This bill requires natural gas corporations to
develop and implement natural gas safety plans, with
specified elements. The safety plans are subject to review
and approval by the Public Utilities Commission (PUC).
ANALYSIS : Federal law and general orders of the PUC
requires the commission to regulate natural gas
transmission, distribution, and other pipelines. Operators
of natural gas pipelines are required to develop emergency
response plans. Federal law also requires pipeline
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operators to provide information to the federal Department
of Transportation on the location of gas pipelines. While
federal law and Commission orders generally give the
Commission oversight responsibility for natural gas
pipelines, the scope of this oversight is ambiguous.
Existing Federal law
1.Requires the United States Department of Transportation
Pipeline and Hazardous Materials Safety Administration
(PHMSA) to adopt minimum safety standards for pipeline
transportation and for pipeline facilities, including an
interstate gas pipeline facility and an intrastate gas
pipeline facility, as defined.
2.Prohibits a state authority from adopting or continuing
in force safety standards for interstate pipeline
facilities or interstate pipeline transportation, but
permits a state authority that has submitted a specified
certification to adopt additional or more stringent
safety standards for intrastate pipeline facilities and
intrastate pipeline transportation only if those
standards are compatible with the minimum standards
prescribed by PHMSA.
Existing law authorizes the United States Secretary of
Transportation to prescribe or enforce safety standards and
practices for an intrastate pipeline facility or intrastate
pipeline transportation to the extent that the safety
standards and practices are regulated by a state authority
that annually submits to the secretary a certification for
the facilities and transportation or, alternatively,
authorizes the secretary to make an agreement with a state
authority authorizing it to take necessary action to meet
certain pipeline safety requirements.
This bill
1.Requires natural gas corporations to develop and
implement natural gas safety plans, with specified
elements. The safety plans are subject to review and
approval by the commission.
2.Requires natural gas corporations to develop and
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implement natural gas safety plans, with specified
elements. The safety plans are subject to review and
approval by the commission.
3.Requires the commission to accept, modify, or reject the
plan by December 31, 2012.
4.Reorganizes and revises existing provision relative to
restructuring of the natural gas industry to declare that
it is the policy of the state to place safety of the
public and gas corporation employees as the top priority
and require the commission to require that the
distribution rate of a gas corporation include sufficient
revenues and employee staffing to provide for prompt
provision of service to the public consistent with this
policy.
FISCAL EFFECT : Appropriation: No Fiscal Com.: Yes
Local: Yes
According to the Senate Appropriations Committee:
Fiscal Impact (in
thousands)
Major Provisions 2011-12 2012-13
2013-14 Fund
Review and oversight $240 Special *
of safety plans
* Public Utilities Commission Utilities Reimbursement
Account
SUPPORT : (5/26/11)
The Utility Reform Network (co-source)
Utility Workers Union of America (co-source)
California Labor Federation
Coalition of California Utility Employees
Consumer Federation of California
International Brotherhood of Electrical Workers
San Diego and Imperial Counties Labor Council
San Diego Gas & Electric Company (if amended)
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Sempra Energy (if amended)
Southern California Gas Company (if amended)
ARGUMENTS IN SUPPORT : According to the author's office,
"After the explosion at San Bruno and the ongoing episodes
of gas explosions around the country it is now generally
recognized that system safety has been a lower priority in
operating and maintaining the system for transporting,
delivering and using natural gas. As a result the public is
at great risk of accidents and explosions. The CPUC has
undertaken several initiatives to improve system safety and
thus the quality of gas service offered to the public, and
has recently demonstrated a greater sense of urgency in
addressing systemic safety concerns. This sense of urgency
has been stimulated by legislative hearings such as those
we held in October and the introduction of AB 56 (Hill) in
the Assembly and this bill in the Senate."
"Enactment of this bill in its amended version accomplishes
the necessary first steps: the creation of a permanent
state policy placing safety first: a legislative directive
to implement the policy through a thorough-going change in
the culture of the industry and the utilities that places
safety first in operation and maintenance procedures and
programs for both workers and management; the creation of
safety plan process for each utility overseen by and
subject to the approval of the CPUC; and specific
assurances to the public that the money it will take to
implement safety programs will not be diverted to the
utilities' bottom line. This bill provides the
Legislature's policy direction and outlines a process that
assures continuous attention to safety in the gas
industry."
RM:rm 5/26/2011 Senate Floor Analyses
SUPPORT/OPPOSITION: SEE ABOVE
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