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PUC has leeway to restructure utility rates

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POSTED October 7, 2013 9:19 p.m.

SACRAMENTO  (AP) — A bill to promote greater use of renewable energy in California while allowing for changes in how consumers pay for electricity has been signed into law, Gov. Jerry Brown announced Monday.

The Democratic governor said in a signing message that AB327 will provide "comprehensive rate reform," but what that means will be determined by the California Public Utilities Commission.

The new law authorizes the PUC to restructure electricity rates while protecting low-income customers and encouraging greater use of renewable energy. The bill includes legal guarantees of rate discounts for low-income consumers that the commission must follow as it sets rates, but the bill's impact on the majority of ratepayers is unclear.

Mark Toney, executive director of The Utility Reform Network, a consumer advocacy group, said he expects the regulatory rate-setting process to take at least the next two years.

"We're pretty hopeful that the PUC will adopt something that's fair to consumers," he said.

For instance, he is confident that advocates can fight provisions that would allow the commission to charge ratepayers fees of up to $10 a month or change the tiers that generally limit costs for consumers who use less electricity. He also was satisfied with protections built into the law for low-income and residential consumers.

Assemblyman Henry Perea, D-Fresno, previously said his bill will let the state replace outdated regulations adopted during the state's energy crisis more than a decade ago.

The bill also makes it clear that California's goal of obtaining a third of its electricity from renewable sources by 2020 is a minimal requirement and not an upper limit — "a floor, not a ceiling," Brown said in his signing message. He said the measure will "maintain robust incentives for renewable energy investments."

Bernadette Del Chiaro, executive director of the California Solar Energy Industries Association, said in a statement that the bill should encourage more consumers to switch to solar energy.

Brown said in his signing message that he expects the utilities commission's pending rules to protect customers who previously paid for solar installations. The bill also allows for a new unlimited net energy metering program.

Net metering lets renewable energy producers turn their electricity meter backward as they contribute electricity to the system. Previous law limited the number of consumers who could take advantage of net metering to 5 percent of each utility's peak load.

Other portions of the bill address hold-over regulations from the energy crisis that brought rolling brownouts and high energy costs to California in 2000-2001 following an attempt to deregulate the electricity industry.

 

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