California Legislature—2013–14 Regular Session

Assembly Bill No. 2218

Introduced by Assembly Member Bradford

February 20, 2014

An act to amend Section 739.1 of the Public Utilities Code, relating to energy.

LEGISLATIVE COUNSEL’S DIGEST

AB 2218, as introduced, Bradford. Electricity and natural gas rates.

Under existing law, the Public Utilities Commission has regulatory authority over public utilities, including electrical corporations and gas corporations, as defined. 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 requires the commission to establish a program of assistance to low-income electric and gas customers, referred to as the California Alternate Rates for Energy (CARE) program. The CARE program provides lower rates to low-income customers that are financed through a separate rate component, that is required to be a nonbypassable element of the local distribution service and collected on the basis of usage. Eligibility for the CARE program is for those electric and gas customers with annual household incomes that are no greater than 200% of the federal poverty guideline levels.

This bill would require the commission to establish a program of electric and gas service rate assistance to food banks, as defined, with specified discounts to be provided in the form of a reduction in the overall bill for the eligible food bank customer.

Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.

Because the provisions of this bill would be a part of the act and because a violation of an order or decision of the commission implementing its requirements would be a crime, the bill would impose a state-mandated local program by creating a new crime.

The California Constitution requires the state to reimburse local agencies and school districts for certain costs mandated by the state. Statutory provisions establish procedures for making that reimbursement.

This bill would provide that no reimbursement is required by this act for a specified reason.

Vote: majority. Appropriation: no. Fiscal committee: yes. State-mandated local program: yes.

The people of the State of California do enact as follows:

SECTION 1.  

Section 739.1 of the Public Utilities Code is
amended to read:

739.1.  

(a) The commission shall continue a program of
assistance to low-income electric and gas customers with annual
household incomes that are no greater than 200 percent of the
federal poverty guideline levels, the cost of which shall not be
borne solely by any single class of customer. For one-person
households, program eligibility shall be based on two-person
household guideline levels. The program shall be referred to as
the California Alternate Rates for Energy or CARE program. The
commission shall ensure that the level of discount for low-income
electric and gas customers correctly reflects the level of need.

(b) The commission shall establish rates for CARE program
participants, subject to both of the following:

(1) That the commission ensure that low-income ratepayers are
not jeopardized or overburdened by monthly energy expenditures,
pursuant to subdivision (b) of Section 382.

(2) That the level of the discount for low-income electricity and
gas ratepayers correctly reflects the level of need as determined
by the needs assessment conducted pursuant to subdivision (d) of
Section 382.

(c) In establishing CARE discounts for an electrical corporation
with 100,000 or more customer accounts in California, the
commission shall ensure all of the following:

(1) The average effective CARE discount shall not be less than
30 percent or more than 35 percent of the revenues that would
have been produced for the same billed usage by non-CARE
customers. The average effective discount determined by the
commission shall reflect any charges not paid by CARE customers,
including payments for the California Solar Initiative, payments
for the self-generation incentive program made pursuant to Section
379.6, payment of the separate rate component to fund the CARE
program made pursuant to subdivision (a) of Section 381, payments
made to the Department of Water Resources pursuant to Division
27 (commencing with Section 80000) of the Water Code, and any
discount in a fixed charge. The average effective CARE discount
shall be calculated as a weighted average of the CARE discounts
provided to individual customers.

(2) If an electrical corporation provides an average effective
CARE discount in excess of the maximum percentage specified
in paragraph (1), the electrical corporation shall not reduce, on an
annual basis, the average effective CARE discount by more than
a reasonable percentage decrease below the discount in effect on
January 1, 2013, or that the electrical corporation had been
authorized to place in effect by that date.

(3) The entire discount shall be provided in the form of a
reduction in the overall bill for the eligible CARE customer.

(d) The commission shall work with electrical and gas
corporations to establish penetration goals. The commission shall
authorize recovery of all administrative costs associated with the
implementation of the CARE program that the commission
determines to be reasonable, through a balancing account
mechanism. Administrative costs shall include, but are not limited
to, outreach, marketing, regulatory compliance, certification and
verification, billing, measurement and evaluation, and capital
improvements and upgrades to communications and processing
equipment.

(e) The commission shall examine methods to improve CARE
enrollment and participation. This examination shall include, but
need not be limited to, comparing information from CARE and
the Universal Lifeline Telephone Service (ULTS) to determine
the most effective means of utilizing that information to increase
CARE enrollment, automatic enrollment of ULTS customers who
are eligible for the CARE program, customer privacy issues, and
alternative mechanisms for outreach to potential enrollees. The
commission shall ensure that a customer consents prior to
enrollment. The commission shall consult with interested parties,
including ULTS providers, to develop the best methods of
informing ULTS customers about other available low-income
programs, as well as the best mechanism for telephone providers
to recover reasonable costs incurred pursuant to this section.

(f) (1) The commission shall improve the CARE application
process by cooperating with other entities and representatives of
California government, including the California Health and Human
Services Agency and the Secretary of California Health and Human
Services, to ensure that all gas and electric customers eligible for
public assistance programs in California that reside within the
service territory of an electrical corporation or gas corporation,
are enrolled in the CARE program. The commission may determine
that gas and electric customers are categorically eligible for CARE
assistance if they are enrolled in other public assistance programs
with substantially the same income eligibility requirements as the
CARE program. To the extent practicable, the commission shall
develop a CARE application process using the existing ULTS
application process as a model. The commission shall work with
electrical and gas corporations and the Low-Income Oversight
Board established in Section 382.1 to meet the low-income
objectives in this section.

(2) The commission shall ensure that an electrical corporation
or gas corporation with a commission-approved program to provide
discounts based upon economic need in addition to the CARE
program, including a Family Electric Rate Assistance program,
utilize a single application form, to enable an applicant to
alternatively apply for any assistance program for which the
applicant may be eligible. It is the intent of the Legislature to allow
applicants under one program, that may not be eligible under that
program, but that may be eligible under an alternative assistance
program based upon economic need, to complete a single
application for any commission-approved assistance program
offered by the public utility.

(g) It is the intent of the Legislature that the commission ensure
CARE program participants receive affordable electric and gas
service that does not impose an unfair economic burden on those
participants.

(h) The commission’s program of assistance to low-income
electric and gas customers shall, as soon as practicable, include
nonprofit group living facilities specified by the commission, if
the commission finds that the residents in these facilities
substantially meet the commission’s low-income eligibility
requirements and there is a feasible process for certifying that the
assistance shall be used for the direct benefit, such as improved
quality of care or improved food service, of the low-income
residents in the facilities. The commission shall authorize utilities
to offer discounts to eligible facilities licensed or permitted by
appropriate state or local agencies, and to facilities, including
women’s shelters, hospices, and homeless shelters, that may not
have a license or permit but provide other proof satisfactory to the
utility that they are eligible to participate in the program.

(i) (1) In addition to existing assessments of eligibility, an
electrical corporation may require proof of income eligibility for
those CARE program participants whose electricity usage, in any
monthly or other billing period, exceeds 400 percent of baseline
usage. The authority of an electrical corporation to require proof
of income eligibility is not limited by the means by which the
CARE program participant enrolled in the program, including if
the participant was automatically enrolled in the CARE program
because of participation in a governmental assistance program. If
a CARE program participant’s electricity usage exceeds 400
percent of baseline usage, the electrical corporation may require
the CARE program participant to participate in the Energy Savings
Assistance Program (ESAP), which includes a residential energy
assessment, in order to provide the CARE program participant
with information and assistance in reducing his or her energy usage.
Continued participation in the CARE program may be conditioned
upon the CARE program participant agreeing to participate in
ESAP within 45 days of notice being given by the electrical
corporation pursuant to this paragraph. The electrical corporation
may require the CARE program participant to notify the utility of
whether the residence is rented, and if so, a means by which to
contact the landlord, and the electrical corporation may share any
evaluation and recommendation relative to the residential structure
that is made as part of an energy assessment, with the landlord of
the CARE program participant. Requirements imposed pursuant
to this paragraph shall be consistent with procedures adopted by
the commission.

(2) If a CARE program participant’s electricity usage exceeds
600 percent of baseline usage, the electrical corporation shall
require the CARE program participant to participate in ESAP,
which includes a residential energy assessment, in order to provide
the CARE program participant with information and assistance in
reducing his or her energy usage. Continued participation in the
CARE program shall be conditioned upon the CARE program
participant agreeing to participate in ESAP within 45 days of a
notice made by the electrical corporation pursuant to this paragraph.
The electrical corporation may require the CARE program
participant to notify the utility of whether the residence is rented,
and if so, a means by which to contact the landlord, and the
electrical corporation may share any evaluation and
recommendation relative to the residential structure that is made
as part of an energy assessment, with the landlord of the CARE
program participant. Following the completion of the energy
assessment, if the CARE program participant’s electricity usage
continues to exceed 600 percent of baseline usage, the electrical
corporation may remove the CARE program participant from the
program if the removal is consistent with procedures adopted by
the commission. Nothing in this paragraph shall prevent a CARE
program participant with electricity usage exceeding 600 percent
of baseline usage from participating in an appeals process with the
electrical corporation to determine whether the participant’s usage
levels are legitimate.

(3) A CARE program participant in a rental residence shall not
be removed from the program in situations where the landlord is
nonresponsive when contacted by the electrical corporation or
does not provide for ESAP participation.

begin insert

(j) (1) For purposes of this subdivision, the following terms
have the following meanings:

end insert begin insert

(A) “Food bank” means a surplus food collection and
distribution system operated and established to assist in bringing
donated agricultural products or food to nonprofit charitable
organizations and individuals for the purposes of reducing hunger
and supplying nutritional needs. In order to qualify as a food bank
that brings donated agricultural products to nonprofit charitable
organizations or individuals, an organization shall meet the
minimum standards of Section 58503.1 of the Food and
Agricultural Code.

end insert begin insert

(B) “Nonprofit charitable organization” means an organization
described in Section 501(c)(3) of the Internal Revenue Code (26
U.S.C. Sec. 501(c)(3)), that is exempt from taxation under Section
501(a) of that code (16 U.S.C. Sec. 501(a)).

end insert begin insert

(2) The commission shall establish a program of electric and
gas service rate assistance to food banks, the cost of which shall
not be borne solely by any single class of customer. The average
effective food bank discount shall not be less than 30 percent or
more than 35 percent of the revenues that would have been
produced for the same billed usage without the discount. The
average effective discount determined by the commission shall
reflect any charges not paid by food banks receiving service
pursuant to the food bank tariff, including payments for the
California Solar Initiative, payments for the self-generation
incentive program made pursuant to Section 379.6, payment of
the separate rate component to fund the CARE program made
pursuant to subdivision (a) of Section 381, payments made to the
Department of Water Resources pursuant to Division 27
(commencing with Section 80000) of the Water Code, and any
discount in a fixed charge. The entire discount shall be provided
in the form of a reduction in the overall bill for the eligible food
bank customer.

end insert

SEC. 2.  

No reimbursement is required by this act pursuant to
Section 6 of Article XIII B of the California Constitution because
the only costs that may be incurred by a local agency or school
district will be incurred because this act creates a new crime or
infraction, eliminates a crime or infraction, or changes the penalty
for a crime or infraction, within the meaning of Section 17556 of
the Government Code, or changes the definition of a crime within
the meaning of Section 6 of Article XIII B of the California
Constitution.