BILL ANALYSIS                                                                                                                                                                                                    �




                   Senate Appropriations Committee Fiscal Summary
                           Senator Christine Kehoe, Chair

                                          SB 705 (Leno)
          
          Hearing Date: 05/26/2011        Amended: 05/05/2011
          Consultant: Brendan McCarthy    Policy Vote: EU&C 9-0
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          BILL SUMMARY: SB 705 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.
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                            Fiscal Impact (in thousands)

           Major Provisions         2011-12      2012-13       2013-14     Fund
           
          Review and oversight of           $240                  Special 
          *
             safety plans

          * Public Utilities Commission Utilities Reimbursement Account.
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          STAFF COMMENTS: SUSPENSE FILE. 

          Federal law and general orders of the Public Utilities 
          Commission require 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 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.

          SB 705 requires natural gas corporations to develop, adopt, and 
          implement service and safety plans. The bill specifies certain 
          safety issues that must be addressed in the plans. For example, 
          the plans must address maximum operating pressures for natural 
          gas transmission lines and seismic safety issues.









          SB 705 (Leno)
          Page 1


          The Public Utilities Commission is required to review and 
          accept, modify, or reject the plans. Natural gas corporations 
          are required to periodically review and update the plans, and 
          the Commission is required to review any updates to the plans.

          The bill also reorganizes existing Public Utilities Code 
          provisions governing the provision of natural gas service.

          Staff estimates that the Public Utilities Commission will 
          require two additional positions to review proposed new safety 
          plans.


          SB 44 (Corbett) requires the Public Utilities Commission to 
          develop emergency response standards for natural gas 
          transmission systems. That bill is on this committee's Suspense 
          File.

          SB 216 (Yee) requires natural gas corporations to install 
          automatic shut off valves or remote controlled valves on natural 
          gas transmission lines in areas of high population density. That 
          bill is on this committee's Suspense File.

          SB 879 (Padilla) requires the Public Utilities Commission to 
          require natural gas utilities to account for ratepayer funds 
          designated for pipeline maintenance and repair in a more 
          transparent way. That bill will be heard in this committee.