Public utilities: inspection and audit of books and records.
The bill's adoption potentially streamlines the regulatory process for the larger public utilities by allowing more flexibility in audit schedules while still ensuring regular oversight. For smaller utilities, the existing audit frequency continues, likely reflecting the understanding that smaller entities may present less regulatory risk. This distinction in frequency attempts to balance thorough regulatory oversight with the operational realities faced by utilities, addressing the varying levels of resources and risks associated with different sized operations.
Senate Bill 1410, introduced by Morrell, amends Section 314.5 of the Public Utilities Code, focusing on the inspection and audit protocols for public utilities in California. The bill modifies existing requirements by mandating that utilities serving over 10,000 customers be inspected and audited at least once every three years or in accordance with the commission's general rate case cycle, which should not extend beyond five years. For smaller utilities (those serving 10,000 or fewer customers), the requirement remains at least once every five years. This change asserts a more tailored approach to regulation based on the size of the utilities.
The general sentiment surrounding SB 1410 appears to be pragmatic, with legislators acknowledging the need to adapt regulatory frameworks to accommodate the operational realities of large versus small public utilities. Supporters likely argue that this bill will help reduce unnecessary regulatory burdens on larger companies while maintaining essential oversight, though there might be concerns about the implications for consumer protection and accountability in both large and small utility operations.
While the modifications offered by SB 1410 are largely seen as beneficial for smoothing regulatory processes, there may be contention regarding the oversight of larger utilities, particularly in the context of past failures of utility companies that have led to significant public safety and environmental concerns. Critics might argue that reducing the frequency of audits could create loopholes or oversight gaps that larger entities may exploit, potentially leading to diminished transparency and accountability in their operations.