News Release - Office of Senator Jerry Hill – January 15, 2014
Contacts: Aurelio Rojas, 916-747-3199 cell; Leslie Guevarra, 415-298-3404 cell
Senator Hill Introduces Bill to Require CPUC to Consider Safety Records of Gas and Electricity Utilities in Setting Customer Rates
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SB 900 was Shaped by Public Hearings Held by Hill’s Senate Committee and Two Critical Reports
SACRAMENTO – State Senator Jerry Hill today introduced legislation that would require the California Public Utilities Commission (CPUC) to consider the safety records of natural gas and electricity companies when setting customer rates and developing regulations.
Find out what's happening in San Brunowith free, real-time updates from Patch.
The San Mateo Democrat, who chairs the Senate’s Subcommittee on Gas and Electric Infrastructure, held two public hearings in his district last fall focusing on steps the commission should take to improve safety oversight of utilities.
His subcommittee also released a report that concluded CPUC priorities do not include safety; safety isn’t adequately considered in utility proposals for rate increases; and the commission’s safety enforcement programs are in disarray. The report echoed findings of a confidential CPUC-commissioned report, which noted a lack of satisfaction in the CPUC’s safety culture, stating that “when safety is considered in a case proceeding it is at the end of the process, when it is too late to make necessary changes.”
The subcommittee report also criticized the commission’s lack of progress on safety since the 2010 Pacific Gas & Electric Co. natural gas explosion that killed eight people and destroyed 38 homes in San Bruno, which Hill represents.
Hill’s legislation would also require the CPUC to consider safety in developing regulations. The report noted the CPUC lacks processes to incorporate safety in the implementation of the Governor’s and Legislature’s renewable energy goals.
SB 900 would also:
· Require the CPUC’s Safety and Enforcement Division to examine and report on a utility’s safety performance whenever a utility asks for a rate increase,
· Require the Safety and Enforcement Division to assess whether the utility effectively analyzed safety when developing a proposal for a rate increase, and
· Require the CPUC to consult with agencies such as the State Fire Marshal and the Building Standards Commission in making new regulations about new energy technology placed on homes and businesses.
Since release of the subcommittee report in October, the CPUC has made an effort to correct problems identified. It has started a process to examine the safety of utility proposals for rate increases. It has begun to examine the safety of residential battery installations. SB 900 will provide a comprehensive framework so that the CPUC may translate these efforts into success stories and rehabilitate its reputation in the eyes of the public.
BACKGROUND:
As chair of the state Senate's Subcommittee on Gas and Electric Infrastructure Safety, Hill held a hearing with Assemblymen Steven Bradford and Kevin Mullin on November 18 in San Francisco to examine the CPUC's progress on safety oversight in the three years since the fatal PG&E gas pipeline explosion in San Bruno.
Bradford, D-Gardena, chairs the Assembly Committee on Utilities and Commerce, and Mullin, D-South San Francisco, is the Assembly's Assistant Speaker Pro Tempore. The hearing in San Francisco focused on the California Public Utilities Commission's safety oversight of the utilities it regulates -- as well as the safety policies and practices of the agency itself.
The starting point for the discussion was the subcommittee’s report – “Slow Progress in Safety Regulation: Improving Priorities and Safety Plans of the California Public Utilities Commission” – which found that the CPUC has failed to develop a system to track how utilities implement its directives.
The report also concluded the commission dragged its feet in investigating four fatal electrocutions involving fallen power lines in the yards of two homes. The CPUC failed to finish its investigations into the deaths of a San Mateo man in 2012 and of a San Bernardino couple and an adult son in 2011.
The report found that the commission ignored safety in its recent decision to bill customers potentially billions of dollars for new energy storage projects despite recent high-profile accidents; walked away without follow-up after completing safety audits of PG&E; and has not produced an annual report on gas and electric safety for any years after 2009.
The report said the CPUC must take a greater role in prioritizing safety and ensuring that the commission actions and operations reflect this priority. It also faulted commissioners for ceding safety responsibility to commission staff.
Among its recommendations the report called for the CPUC to develop plans to implement safety measures that include goals, actions to meet those goals, and metrics to gauge success, and that the commission should consider safety-related findings, developed through a risk analysis, in making decisions.
View the report here.
In a letter to Senate Energy Committee Chair Alex Padilla, Hill wrote the CPUC “simply is not organized for success” and “appears to be a year behind where it should be.”
View Hill’s letter to Senator Padilla here.
The report was released on October 28 following Hill’s subcommittee hearing, “Improving Safety Communication Among Cities, Utilities and CPUC” in which the cities of San Bruno, San Carlos, and Burlingame discussed their concerns with Pacific Gas and Electric Company’s outreach efforts. These concerns were raised anew with the court-ordered shutdown of a high pressure natural gas line running through San Carlos.
View a webcast of the hearing here. Hearing materials can be found here.
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Nate Solov
Office of Senator Jerry Hill