BILL ANALYSIS �
SB 1090
Page 1
SENATE THIRD READING
SB 1090 (Fuller)
As Amended July 1, 2014
Majority vote
SENATE VOTE :37-0
UTILITIES & COMMERCE 14-0
APPROPRIATIONS 17-0
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|Ayes:|Patterson, Bonilla, |Ayes:|Gatto, Bigelow, |
| |Buchanan, Ch�vez, Dahle, | |Bocanegra, Bradford, Ian |
| |Fong, Beth Gaines, | |Calderon, Campos, |
| |Garcia, Roger Hern�ndez, | |Donnelly, Eggman, Gomez, |
| |Jones, Mullin, Quirk, | |Holden, Jones, Linder, |
| |Rendon, Skinner | |Pan, Quirk, |
| | | |Ridley-Thomas, Wagner, |
| | | |Weber |
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SUMMARY : Requires the California Public Utilities Commission
(PUC) to explicitly consider whether hardship will be caused to
customers living in hot, inland areas before imposing default
time-of-use (TOU) rates. Specifically, this bill :
1)States the PUC shall not require or authorize an electrical
corporation to employ default TOU pricing for residential
customers unless it has explicitly considered whether hardship
will be caused on the following:
a) Customers located in hot, inland areas, assuming no
changes in overall usage by those customers during peak
periods.
b) Residential customers living in areas with hot summer
weather, as a result of seasonal bill volatility, assuming
no change in summertime usage or in usage during peak
periods.
EXISTING LAW :
1)Requires that all rates for any service or product charged by
an electrical corporation be just and reasonable. (Public
SB 1090
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Utilities Code Section 451)
2)Permits the PUC to authorize an electrical corporation to
offer residential customers the option of receiving service
pursuant to time-variant pricing, as defined, and to
participate in other demand reduction response programs, but
prohibits the PUC from authorizing an electrical corporation
to employ mandatory or default time-variant pricing for any
residential customer, except that beginning January 1, 2018,
the PUC may require or authorize an electrical corporation to
employ default TOU pricing for residential customers, subject
to specified limitations and conditions. (Public Utilities
Code Section 745)
FISCAL EFFECT : According to the Assembly Appropriations
Committee, absorbable costs to the PUC.
COMMENTS : The author notes "while we are hopeful that rate
reform will help my constituents and others in the inland areas
of the state with regard to heavy air-conditioning bills, we are
still very concerned about the potential hardships of default
time-of-use rates on very hot climates in which there may be
little ability to adjust electricity usage. This bill continues
and is consistent with the rate reform process, which stemmed in
part from the concerns of the Central Valley over high summer
electricity bills. SB 1090 extends rate reform to require the
PUC to do a more thorough examination of the impact of one part
of that reform, the potential for default time-of-use rates, in
terms of the hardships which may be caused in hot climates."
Impact of TOU rates on residential customers. The
investor-owned utilities (IOUs) currently offer TOU rates as a
voluntary option for residential customers. As previously
mentioned, the PUC may order the IOUs to establish default TOU
rates for residential customers after January 2018. Once
default TOUs are implemented, residential customers would be
automatically switched to these rates unless they take action to
affirmatively notify the utility company to opt-out.
This bill requires the PUC to explicitly consider whether
hardship will be caused on customers located in hot, inland
areas, assuming no changes in overall usage by those customers
in peak periods. This bill also requires the PUC to consider
residential customers living in areas with hot summer weather,
SB 1090
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as a result of seasonal bill volatility, assuming no change in
summertime usage or in usage during peak periods.
Analysis Prepared by : DaVina Flemings / U. & C. / (916)
319-2083
FN: 0004767