California Procurement Authority.
The bill requires the California Public Utilities Commission (CPUC) to develop an implementing framework for the authority by January 1, 2023, with the authority becoming operational by January 1, 2024. This shift not only grants the authority supervisory powers over the procurement of electrical resources but also delineates responsibilities concerning the electrical distribution grid. An electrical corporation remains primarily responsible for planning and operating its distribution grid, although the authority will step in where load-serving entities fail to meet regulatory requirements.
Assembly Bill 1088, introduced by Assembly Member Mayes, establishes the California Procurement Authority as a central procurement entity to oversee electrical resources in California. The bill aims to ensure that load-serving entities have adequate electrical resources to meet demand, thereby ensuring resource adequacy over both short and long terms. The establishment of this authority is a response to the evolving landscape of electricity provision in California, where a significant portion of electrical load is expected to be served by entities other than traditional electrical corporations, including community choice aggregators and direct access providers.
One significant point of contention is whether the centralized power will undermine local providers' capabilities. Critics may argue that moving towards a centralized procurement model could limit competition and innovation among smaller, local electric service providers. Additionally, there are concerns about the implications of designating specific agencies as providers of last resort in scenarios where electrical corporations choose not to serve certain customer segments. The bill's incorporation of strict compliance measures with existing clean energy standards, as well as its mechanisms for ensuring financial sustainability in procurement practices, may spur discussions on the balance between regulatory oversight and market adaptation.