CC SR 20160405 E - AB2381 Compensation for Extended Power OutagesRANCHO PALOS VERDES CITY COUNCIL
AGENDA REPORT
AGENDA DESCRIPTION:
MEETING DATE: 04/05/2016
AGENDA HEADING: Consent Calendar
Consideration and possible action to express support for Assembly Bill No. 2381
regarding compensation for extended power outages
RECOMMENDED COUNCIL ACTION:
(1) Authorize the Mayor to sign a letter supporting Assembly Bill No. 2381 (AB 2381)
regarding compensation for extended power outages.
FISCAL IMPACT: None
Amount Budgeted: N/A
Additional Appropriation: N/A
Account Number(s): N/A
ORIGINATED BY: Kit Fox, AICP, Senior Administrative Analyst
REVIEWED BY: Gabriella Yap, Deputy City Manager>X'1
APPROVED BY: Doug Willmore, City Manager'
ATTACHED SUPPORTING DOCUMENTS:
A. Draft support letter for AB 2381 (page A-1)
B. AB 2381 (page B-1)
BACKGROUND AND DISCUSSION:
The City of Rancho Palos Verdes and other cities in the South Bay have longstanding
concerns regarding the reliability of Southern California Edison (SCE) equipment and
service. In 2015, the average duration of prolonged outages in Rancho Palos Verdes
exceeded three (3) hours, and the average annual frequency of prolonged outages
exceeded one (1) for each of the thirty (30) SCE circuits serving the City's residents and
businesses.
On the Palos Verdes Peninsula, SCE's aged infrastructure has caused fires and
repeated, prolonged power outages. The prolonged power outages adversely affect
residents in a variety of ways, particularly:
• Residents who have a variety of physical challenges and rely on a constant
source of power for medical devices;
• Residents who are senior citizens and are particularly susceptible to injury if
power outages persist for a long period of time into the evening hours; and,
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• Residents who suffer financial burdens as a result of losing food, medication and
other perishable items during prolonged power outages.
Last year, the City Council authorized Staff to prepare and represent a resolution
regarding SCE's claims process and service reliability for the consideration of the
General Assembly at the annual California League of Cities (League) conference.
Although the City's resolution was not approved for presentation to the League's
General Assembly, the League's Environmental Quality Committee expressed interest
in investigating the claims processes and service reliability for all investor- and publicly -
owned utilities in the State.
On February 8, 2016, Assemblymember Hadley introduced Assembly Bill No. 1800
(AB 1800) regarding utility outage compensation claims. AB 1800 is intended to give
utility ratepayers the information necessary to know if their claims for reimbursement are
being fairly and expeditiously processed, and inspire more confidence in the claims
process. The City Council approved a letter of support for AB 1800 on March 1, 2016.
On March 3, 2016, the League brought to Staff's attention the recent introduction of
Assembly Bill No. 2381 (AB 2381) by 48th District State Assemblymember Roger
Hernandez. AB 2381 (Attachment B) would require electrical corporations to provide a
$25.00 bill credit to customers for each continuous 24-hour period that they were
without power. Staff believes that AB 2381 would complement the claims process
reporting reforms proposed under AB 1800. Therefore, Staff has prepared a draft letter
of support for AB 2381 (Attachment A) for the City Council's consideration and approval
at tonight's meeting.
ALTERNATIVES:
In addition to the Staff recommendation, the following alternative actions are available
for the City Council's consideration:
Do not authorize the Mayor to sign the support letter for AB 2381.
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April 5, 2016
Honorable Roger Hernandez
California State Assembly
State Capitol, Room 5016
Sacramento, CA 95814
RE:
AB 2381(Hernandez): Electricity: Power Outdid=*. Will vIcww.
Notice of Support
VIA FAX: (916) 319-2148
Dear Assemblymember Hernandez:
On behalf of the City of Rancho Palos Verdes and its residents, I would like to convey our support for
AB 2381 regarding automatic bill credits for prolonged electrical power outages.
Under existing law, the California Public Utilities Commission (CPUC) has regulatory authority over public
utilities, including electrical corporations. 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. AB 2381
would require electrical corporations to provide customers that experience outages for a continuous 24-
hour period with a $25 bill credit for each 24-hour period that they were without power.
The cities of the Palos Verdes Peninsula experience frequent and prolonged outages due to the failure of
Southern California Edison (SCE) equipment. These outages and service interruptions are inconvenient
at best, and deadly at worst. They can lead to spoiled food and prescription medication; damage to
electronic equipment and appliances due to energy interruptions; or failure in necessary medical equipment
for senior citizens and those with physical challenges. Customers may file claims for reimbursement for
damage experienced due to prolonged outages, but SCE has recently confirmed that 63% of the claims
filed by Palos Verdes Peninsula residents over the past three (3) years were denied. The automatic bill
credits provided by AB 2381 will help to at least partially offset customers' losses.
We appreciate your leadership on this important issue and, for these reasons, the City of Rancho Palos
Verdes supports AB 2381.
Sincerely yours,
Ken Dyda
Mayor, City of Rancho Palos Verdes
cc: Rancho Palos Verdes City Council
Doug Willmore, City Manager
Gabriella Yap, Deputy City Manager
Kit Fox, Senior Administrative Analyst
A-1
CALIFORNIA LEGISLATURE -2015-16 REGULAR SESSION
ASSEMBLY BILL
No. 2381
Introduced by Assembly Member Roger Hernandez
February 18, 2016
An act to add Section 740.13 to the Public Utilities Code, relating to
electricity.
LEGISLATIVE COUNSEL'S DIGEST
AB 2381, as introduced, Roger Hernandez. Electricity: power outages:
bill credits.
Under existing law, the Public Utilities Commission has regulatory
authority over public utilities, including electrical corporations. 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.
This bill would require electrical corporations to provide customers
that experience outages for a continuous 24-hour period with a $25 bill
credit for each 24-hour period that they were without power.
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.
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AB 2381 —2—
This
2—
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:
1 SECTION 1. Section 740.13 is added to the Public Utilities
2 Code, to read:
3 740.13. (a) An electrical corporation shall provide each
4 customer that experiences an outage for a continuous 24-hour
5 period a twenty -five -dollar ($25) bill credit for each 24-hour period
6 that the customer is without power.
7 (b) Any expense incurred pursuant to this section shall not be
8 recoverable either directly or indirectly in rates and shall be borne
9 exclusively by the shareholders of the electrical corporation.
10 (c) The bill credit provided by this section is not an exclusive
11 remedy and does not affect any other relief or remedy provided
12 by law.
13 SEC. 2. No reimbursement is required by this act pursuant to
14 Section 6 of Article XIIIB of the California Constitution because
15 the only costs that may be incurred by a local agency or school
16 district will be incurred because this act creates a new crime or
17 infraction, eliminates a crime or infraction, or changes the penalty
18 for a crime or infraction, within the meaning of Section 17556 of
19 the Government Code, or changes the definition of a crime within
20 the meaning of Section 6 of Article XIII B of the California
21 Constitution.
X
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