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AB-2399 Electrical services: provider of last resort. (2021-2022)

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Date Published: 02/17/2022 09:00 PM
AB2399:v99#DOCUMENT


CALIFORNIA LEGISLATURE— 2021–2022 REGULAR SESSION

Assembly Bill
No. 2399

Introduced by Assembly Member Mayes

February 17, 2022

An act to add Section 719 to the Public Utilities Code, relating to electricity.


LEGISLATIVE COUNSEL'S DIGEST


AB 2399, as introduced, Mayes. Electrical services: provider of last resort.
Existing law provides that an electrical corporation is the provider of last resort in its service territory except under specified circumstances, and defines the term “provider of last resort” as the load-serving entity required to provide electrical service to a retail customer whose service is transferred to that entity because the customer’s load-serving entity failed to provide, or denied, service to the customer or otherwise failed to meet its obligations. Under existing law, one circumstance under which the electrical corporation is excused from duties as the provider of last resort is if the Public Utilities Commission designates a load serving entity, as defined, other than the electrical corporation to serve as the provider of last resort for all or a portion of that service territory pursuant to a joint application of the electrical corporation and that load-serving entity. Existing law establishes requirements for the application and for a load-serving entity other than the electrical corporation to serve as the provider of last resort.
This bill would authorize an electrical corporation serving less than 30% of the total electrical load in its distribution service territory to request approval from the commission to voluntarily terminate its electrical service offering by submitting a joint application with a load-serving entity or entities proposing to serve the electrical corporation’s existing customers to transfer those customers to that load-serving entity or entities. The bill would require the joint application to demonstrate that the load-serving entity or entities to which the customers would be transferred have the ability and a viable plan to comply with certain electricity procurement requirements.
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 a commission action implementing those provisions would be a crime, the bill would impose a state-mandated local program.
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   Local Program: YES  

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


SECTION 1.

 (a) The Legislature finds and declares all of the following:
(1) The number of retail sellers of electricity in California and the volume of electrical load served by each type of retail seller has increased significantly over the past decade due to increased customer choice in retail electrical service.
(2) Electrical corporations have historically supplied the majority of the electricity used by retail consumers in California. However, by the mid-2020s, over 85 percent of the electricity used within the distribution service territories of the electrical corporations could be supplied by sources other than electrical corporations, including community choice aggregators, direct access providers, and customer self-generation.
(3) Under existing law, a public utility has a duty to serve, including furnishing and maintaining adequate, efficient, just, and reasonable service, instrumentalities, equipment, and facilities as are necessary to promote the safety, health, comfort, and convenience of its patrons and the public.
(4) Under existing law, electrical corporations are required to provide electrical service as the provider of last resort to customers located in their distribution service territories that are not served by other retail service providers or by self-generation.
(5) It is necessary to ensure that, if an electrical corporation seeks to terminate provision of electrical service in its distribution service territory, its existing customers are transferred to another load-serving entity or entities without interruption of service prior to the electrical corporation’s termination of its electrical service offering.
(6) It is necessary to ensure that, if an electrical corporation seeks to terminate provision of electrical service in its distribution service territory, the commission designates another load-serving entity or entities to act as provider of last resort in the electrical corporation’s distribution service territory.
(b) It is the intent of the Legislature to establish a process to permit an electrical corporation serving less than 30 percent of total electrical load in its distribution service territory to terminate its duty to provide electrical service to customers and transfer its customers to another load-serving entity.

SEC. 2.

 Section 719 is added to the Public Utilities Code, to read:

719.
 (a) An electrical corporation serving less than 30 percent of the total electrical load in its distribution service territory may request commission approval to voluntarily terminate its electrical service offering.
(b) A load-serving entity, as defined in Section 380, may propose to serve the existing customers of the electrical corporation.
(c) The electrical corporation shall submit a joint application with the load-serving entity or entities that propose to serve the electrical corporation’s existing customers requesting commission approval to transfer the existing customers of the electrical corporation to that load-serving entity or entities. The joint application shall demonstrate that the load-serving entity or entities seeking to provide service to the existing customers of the electrical corporation have the ability and a viable plan to meet all of the following requirements:
(1) The requirements of a retail seller pursuant to the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11) of Chapter 2.3).
(2) The requirements of a load-serving entity pursuant to the resource adequacy requirements of Section 380.
(3) The integrated resource planning requirements established by the commission pursuant to Sections 454.51, 454.52, and 454.54.
(d) If the electrical corporation requests in the joint application to transfer its duties as provider of last resort, the joint application shall demonstrate compliance with the requirements of Article 8.5 (commencing with Section 387) of Chapter 2.3.
(e) If an electric service provider, as defined in Section 218.3, is authorized by the commission pursuant to this section to serve the existing customers of the electrical corporation, the maximum allowable total kilowatthours annual limit established pursuant to subdivision (b) of Section 365.1 does not apply to the electric service provider’s service to the existing customers of the electrical corporation in the electrical corporation’s distribution service territory.
(f) The commission shall ensure that customer cost indifference is maintained, consistent with Section 365.2.
(g) Notwithstanding any other law, an electrical corporation that ceases to provide electrical service shall continue to be exclusively responsible for planning, making necessary investments in, and operating the electrical distribution grid in its distribution service territory, including owning, controlling, managing, maintaining, engineering, designing, and constructing the electrical distribution grid on the utility side of customer meters, or, at the electrical corporation’s option, to contract for these grid services from a third party. A distributed energy resource that provides distribution grid operations or services on the utility side of the meter is a part of the electrical distribution grid for these purposes.

SEC. 3.

 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.