Amended IN Assembly March 18, 2024 CALIFORNIA LEGISLATURE 20232024 REGULAR SESSION Assembly Bill No. 3256Introduced by Assembly Member IrwinFebruary 16, 2024 An act relating to electricity. An act to amend Sections 792.5 and 910.7 of, and to add Section 739.14 to, the Public Utilities Code, relating to public utilities.LEGISLATIVE COUNSEL'S DIGESTAB 3256, as amended, Irwin. Local publicly owned electric utilities: resource adequacy. Balancing accounts: reports to the Legislature.Existing law vests the Public Utilities Commission with regulatory authority over public utilities, including electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations. Existing law directs the commission to require a public utility to establish and maintain a balancing account whenever the commission authorizes a change in rates reflecting and passing through to customers specific changes in costs to reflect the balance between the related costs and revenues. Existing law requires the commission to develop a risk-based approach for reviewing those balancing accounts periodically to ensure that the transactions recorded in the balancing accounts are for allowable purposes and are supported by appropriate documentation. Existing law requires the commission to maintain an inventory of the balancing accounts and requires public utilities to record all related costs and revenues in their balancing accounts. Existing law requires the commission to adopt balancing account review procedures that are consistent with a risk-based approach.Existing law requires the commission to annually provide the Legislature with an update on the status of its review of balancing accounts as part of an annual report or by posting it on its internet website, as provided.Existing law provides that all charges demanded or received by any public utility, or by any 2 or more public utilities, for any product or commodity furnished or to be furnished or any service rendered or to be rendered shall be just and reasonable and that every unjust or unreasonable charge demanded or received for such product or commodity or service is unlawful.This bill would require the commission to include, as part of its annual update to the Legislature on the status of its review of balancing accounts, the amount of funds in, and the expenditures from, the balancing accounts of each public utility. The bill would require the commission to annually determine if each balancing account has achieved its intended purpose in the previous year. The bill would require the commission, if it determines that the intended purpose has not been achieved and those costs should not be subject to recovery in the next general rate case, to deny the public utility recovery of those costs and other expenses and to reduce the authority of the public utility to use, or close, the balancing account in order to limit future rate increases. The bill would require the commission to make those determinations and take those actions in a manner that ensures that the rates are sufficient to enable the public utility to recover a just and reasonable rate of return.Under existing law, a violation of any order, decision, rule, direction, demand, or requirement of the commission is a crime.Because a violation of a commission action implementing this bills requirements would be a crime, the bill would impose a state-mandated local program.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.This bill would provide that no reimbursement is required by this act for a specified reason.Under existing law, local publicly owned electric utilities are under the direction of their governing boards. Existing law requires each local publicly owned electric utility serving end-use customers to prudently plan for and procure resources that are adequate to meet its planning reserve margin and peak demand and operating reserves, sufficient to provide reliable electric service to its customers.This bill would express the intent of the Legislature to enact legislation regarding local publicly owned electric utility service resource adequacy and reliability.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: NOYES Local Program: NOYES Bill TextThe people of the State of California do enact as follows:SECTION 1. Section 739.14 is added to the Public Utilities Code, to read:739.14. In making the determinations and taking the actions described in subdivision (g) of Section 792.5, the commission shall ensure that the rates are sufficient to enable the public utility to recover a just and reasonable rate of return.SEC. 2. Section 792.5 of the Public Utilities Code is amended to read:792.5. (a) Whenever the commission authorizes any change in rates reflecting and passing through to customers specific changes in costs, except rates set for common carriers, the commission shall require as a condition of the order that the public utility establish and maintain a balancing account reflecting the balance, whether positive or negative, between the related costs and revenues, and the commission shall take into account by appropriate adjustment or other action any positive or negative balance remaining in the balancing account at the time of any subsequent rate adjustment.(b) The commission shall develop a risk-based approach for reviewing or auditing balancing accounts periodically to ensure that the transactions recorded in the balancing accounts are for allowable purposes and are supported by appropriate documentation.(c) The commission shall maintain an inventory of the balancing accounts established pursuant to this section.(d) The commission shall require the public utility to record all related costs and revenues in the balancing account, unless those costs or revenues are specifically exempted by the commission.(e) The commission shall adopt balancing account review or audit procedures that are consistent with a risk-based approach.(f) The commission may forgo the review or audit of a balancing account pursuant to this section if an independent auditor has reviewed or audited the balancing account in the preceding five years.(g) The commission shall annually determine if each balancing account established pursuant to this section has achieved its intended purpose in the previous year. If the commission determines that the intended purpose of a balancing account has not been achieved and those costs should not be subject to recovery in the next general rate case, the commission shall deny the public utility recovery of those costs and other expenses and shall reduce the authority of the public utility to use, or close, the balancing account in order to limit future rate increases, consistent with Section 739.14.SEC. 3. Section 910.7 of the Public Utilities Code is amended to read:910.7. The commission shall annually provide the Legislature with an update on the status of its review of public utilities balancing accounts pursuant to Section 792.5. The update shall include the amount of funds in, and the expenditures from, each balancing account for each public utility. The commission shall provide this update as part of its annual report published pursuant to Section 910 or by posting it in a conspicuous area of its Internet Web site, internet website, or both.SEC. 4. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.SECTION 1.It is the intent of the Legislature to enact legislation regarding local publicly owned electric utility service resource adequacy and reliability.
Amended IN Assembly March 18, 2024 CALIFORNIA LEGISLATURE 20232024 REGULAR SESSION Assembly Bill No. 3256Introduced by Assembly Member IrwinFebruary 16, 2024 An act relating to electricity. An act to amend Sections 792.5 and 910.7 of, and to add Section 739.14 to, the Public Utilities Code, relating to public utilities.LEGISLATIVE COUNSEL'S DIGESTAB 3256, as amended, Irwin. Local publicly owned electric utilities: resource adequacy. Balancing accounts: reports to the Legislature.Existing law vests the Public Utilities Commission with regulatory authority over public utilities, including electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations. Existing law directs the commission to require a public utility to establish and maintain a balancing account whenever the commission authorizes a change in rates reflecting and passing through to customers specific changes in costs to reflect the balance between the related costs and revenues. Existing law requires the commission to develop a risk-based approach for reviewing those balancing accounts periodically to ensure that the transactions recorded in the balancing accounts are for allowable purposes and are supported by appropriate documentation. Existing law requires the commission to maintain an inventory of the balancing accounts and requires public utilities to record all related costs and revenues in their balancing accounts. Existing law requires the commission to adopt balancing account review procedures that are consistent with a risk-based approach.Existing law requires the commission to annually provide the Legislature with an update on the status of its review of balancing accounts as part of an annual report or by posting it on its internet website, as provided.Existing law provides that all charges demanded or received by any public utility, or by any 2 or more public utilities, for any product or commodity furnished or to be furnished or any service rendered or to be rendered shall be just and reasonable and that every unjust or unreasonable charge demanded or received for such product or commodity or service is unlawful.This bill would require the commission to include, as part of its annual update to the Legislature on the status of its review of balancing accounts, the amount of funds in, and the expenditures from, the balancing accounts of each public utility. The bill would require the commission to annually determine if each balancing account has achieved its intended purpose in the previous year. The bill would require the commission, if it determines that the intended purpose has not been achieved and those costs should not be subject to recovery in the next general rate case, to deny the public utility recovery of those costs and other expenses and to reduce the authority of the public utility to use, or close, the balancing account in order to limit future rate increases. The bill would require the commission to make those determinations and take those actions in a manner that ensures that the rates are sufficient to enable the public utility to recover a just and reasonable rate of return.Under existing law, a violation of any order, decision, rule, direction, demand, or requirement of the commission is a crime.Because a violation of a commission action implementing this bills requirements would be a crime, the bill would impose a state-mandated local program.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.This bill would provide that no reimbursement is required by this act for a specified reason.Under existing law, local publicly owned electric utilities are under the direction of their governing boards. Existing law requires each local publicly owned electric utility serving end-use customers to prudently plan for and procure resources that are adequate to meet its planning reserve margin and peak demand and operating reserves, sufficient to provide reliable electric service to its customers.This bill would express the intent of the Legislature to enact legislation regarding local publicly owned electric utility service resource adequacy and reliability.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: NOYES Local Program: NOYES
Amended IN Assembly March 18, 2024
Amended IN Assembly March 18, 2024
CALIFORNIA LEGISLATURE 20232024 REGULAR SESSION
Assembly Bill
No. 3256
Introduced by Assembly Member IrwinFebruary 16, 2024
Introduced by Assembly Member Irwin
February 16, 2024
An act relating to electricity. An act to amend Sections 792.5 and 910.7 of, and to add Section 739.14 to, the Public Utilities Code, relating to public utilities.
LEGISLATIVE COUNSEL'S DIGEST
## LEGISLATIVE COUNSEL'S DIGEST
AB 3256, as amended, Irwin. Local publicly owned electric utilities: resource adequacy. Balancing accounts: reports to the Legislature.
Existing law vests the Public Utilities Commission with regulatory authority over public utilities, including electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations. Existing law directs the commission to require a public utility to establish and maintain a balancing account whenever the commission authorizes a change in rates reflecting and passing through to customers specific changes in costs to reflect the balance between the related costs and revenues. Existing law requires the commission to develop a risk-based approach for reviewing those balancing accounts periodically to ensure that the transactions recorded in the balancing accounts are for allowable purposes and are supported by appropriate documentation. Existing law requires the commission to maintain an inventory of the balancing accounts and requires public utilities to record all related costs and revenues in their balancing accounts. Existing law requires the commission to adopt balancing account review procedures that are consistent with a risk-based approach.Existing law requires the commission to annually provide the Legislature with an update on the status of its review of balancing accounts as part of an annual report or by posting it on its internet website, as provided.Existing law provides that all charges demanded or received by any public utility, or by any 2 or more public utilities, for any product or commodity furnished or to be furnished or any service rendered or to be rendered shall be just and reasonable and that every unjust or unreasonable charge demanded or received for such product or commodity or service is unlawful.This bill would require the commission to include, as part of its annual update to the Legislature on the status of its review of balancing accounts, the amount of funds in, and the expenditures from, the balancing accounts of each public utility. The bill would require the commission to annually determine if each balancing account has achieved its intended purpose in the previous year. The bill would require the commission, if it determines that the intended purpose has not been achieved and those costs should not be subject to recovery in the next general rate case, to deny the public utility recovery of those costs and other expenses and to reduce the authority of the public utility to use, or close, the balancing account in order to limit future rate increases. The bill would require the commission to make those determinations and take those actions in a manner that ensures that the rates are sufficient to enable the public utility to recover a just and reasonable rate of return.Under existing law, a violation of any order, decision, rule, direction, demand, or requirement of the commission is a crime.Because a violation of a commission action implementing this bills requirements would be a crime, the bill would impose a state-mandated local program.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.This bill would provide that no reimbursement is required by this act for a specified reason.Under existing law, local publicly owned electric utilities are under the direction of their governing boards. Existing law requires each local publicly owned electric utility serving end-use customers to prudently plan for and procure resources that are adequate to meet its planning reserve margin and peak demand and operating reserves, sufficient to provide reliable electric service to its customers.This bill would express the intent of the Legislature to enact legislation regarding local publicly owned electric utility service resource adequacy and reliability.
Existing law vests the Public Utilities Commission with regulatory authority over public utilities, including electrical corporations, gas corporations, heat corporations, telegraph corporations, telephone corporations, and water corporations. Existing law directs the commission to require a public utility to establish and maintain a balancing account whenever the commission authorizes a change in rates reflecting and passing through to customers specific changes in costs to reflect the balance between the related costs and revenues. Existing law requires the commission to develop a risk-based approach for reviewing those balancing accounts periodically to ensure that the transactions recorded in the balancing accounts are for allowable purposes and are supported by appropriate documentation. Existing law requires the commission to maintain an inventory of the balancing accounts and requires public utilities to record all related costs and revenues in their balancing accounts. Existing law requires the commission to adopt balancing account review procedures that are consistent with a risk-based approach.
Existing law requires the commission to annually provide the Legislature with an update on the status of its review of balancing accounts as part of an annual report or by posting it on its internet website, as provided.
Existing law provides that all charges demanded or received by any public utility, or by any 2 or more public utilities, for any product or commodity furnished or to be furnished or any service rendered or to be rendered shall be just and reasonable and that every unjust or unreasonable charge demanded or received for such product or commodity or service is unlawful.
This bill would require the commission to include, as part of its annual update to the Legislature on the status of its review of balancing accounts, the amount of funds in, and the expenditures from, the balancing accounts of each public utility. The bill would require the commission to annually determine if each balancing account has achieved its intended purpose in the previous year. The bill would require the commission, if it determines that the intended purpose has not been achieved and those costs should not be subject to recovery in the next general rate case, to deny the public utility recovery of those costs and other expenses and to reduce the authority of the public utility to use, or close, the balancing account in order to limit future rate increases. The bill would require the commission to make those determinations and take those actions in a manner that ensures that the rates are sufficient to enable the public utility to recover a just and reasonable rate of return.
Under existing law, a violation of any order, decision, rule, direction, demand, or requirement of the commission is a crime.
Because a violation of a commission action implementing this bills requirements would be a crime, the bill would impose a state-mandated local program.
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.
This bill would provide that no reimbursement is required by this act for a specified reason.
Under existing law, local publicly owned electric utilities are under the direction of their governing boards. Existing law requires each local publicly owned electric utility serving end-use customers to prudently plan for and procure resources that are adequate to meet its planning reserve margin and peak demand and operating reserves, sufficient to provide reliable electric service to its customers.
This bill would express the intent of the Legislature to enact legislation regarding local publicly owned electric utility service resource adequacy and reliability.
## Digest Key
## Bill Text
The people of the State of California do enact as follows:SECTION 1. Section 739.14 is added to the Public Utilities Code, to read:739.14. In making the determinations and taking the actions described in subdivision (g) of Section 792.5, the commission shall ensure that the rates are sufficient to enable the public utility to recover a just and reasonable rate of return.SEC. 2. Section 792.5 of the Public Utilities Code is amended to read:792.5. (a) Whenever the commission authorizes any change in rates reflecting and passing through to customers specific changes in costs, except rates set for common carriers, the commission shall require as a condition of the order that the public utility establish and maintain a balancing account reflecting the balance, whether positive or negative, between the related costs and revenues, and the commission shall take into account by appropriate adjustment or other action any positive or negative balance remaining in the balancing account at the time of any subsequent rate adjustment.(b) The commission shall develop a risk-based approach for reviewing or auditing balancing accounts periodically to ensure that the transactions recorded in the balancing accounts are for allowable purposes and are supported by appropriate documentation.(c) The commission shall maintain an inventory of the balancing accounts established pursuant to this section.(d) The commission shall require the public utility to record all related costs and revenues in the balancing account, unless those costs or revenues are specifically exempted by the commission.(e) The commission shall adopt balancing account review or audit procedures that are consistent with a risk-based approach.(f) The commission may forgo the review or audit of a balancing account pursuant to this section if an independent auditor has reviewed or audited the balancing account in the preceding five years.(g) The commission shall annually determine if each balancing account established pursuant to this section has achieved its intended purpose in the previous year. If the commission determines that the intended purpose of a balancing account has not been achieved and those costs should not be subject to recovery in the next general rate case, the commission shall deny the public utility recovery of those costs and other expenses and shall reduce the authority of the public utility to use, or close, the balancing account in order to limit future rate increases, consistent with Section 739.14.SEC. 3. Section 910.7 of the Public Utilities Code is amended to read:910.7. The commission shall annually provide the Legislature with an update on the status of its review of public utilities balancing accounts pursuant to Section 792.5. The update shall include the amount of funds in, and the expenditures from, each balancing account for each public utility. The commission shall provide this update as part of its annual report published pursuant to Section 910 or by posting it in a conspicuous area of its Internet Web site, internet website, or both.SEC. 4. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.SECTION 1.It is the intent of the Legislature to enact legislation regarding local publicly owned electric utility service resource adequacy and reliability.
The people of the State of California do enact as follows:
## The people of the State of California do enact as follows:
SECTION 1. Section 739.14 is added to the Public Utilities Code, to read:739.14. In making the determinations and taking the actions described in subdivision (g) of Section 792.5, the commission shall ensure that the rates are sufficient to enable the public utility to recover a just and reasonable rate of return.
SECTION 1. Section 739.14 is added to the Public Utilities Code, to read:
### SECTION 1.
739.14. In making the determinations and taking the actions described in subdivision (g) of Section 792.5, the commission shall ensure that the rates are sufficient to enable the public utility to recover a just and reasonable rate of return.
739.14. In making the determinations and taking the actions described in subdivision (g) of Section 792.5, the commission shall ensure that the rates are sufficient to enable the public utility to recover a just and reasonable rate of return.
739.14. In making the determinations and taking the actions described in subdivision (g) of Section 792.5, the commission shall ensure that the rates are sufficient to enable the public utility to recover a just and reasonable rate of return.
739.14. In making the determinations and taking the actions described in subdivision (g) of Section 792.5, the commission shall ensure that the rates are sufficient to enable the public utility to recover a just and reasonable rate of return.
SEC. 2. Section 792.5 of the Public Utilities Code is amended to read:792.5. (a) Whenever the commission authorizes any change in rates reflecting and passing through to customers specific changes in costs, except rates set for common carriers, the commission shall require as a condition of the order that the public utility establish and maintain a balancing account reflecting the balance, whether positive or negative, between the related costs and revenues, and the commission shall take into account by appropriate adjustment or other action any positive or negative balance remaining in the balancing account at the time of any subsequent rate adjustment.(b) The commission shall develop a risk-based approach for reviewing or auditing balancing accounts periodically to ensure that the transactions recorded in the balancing accounts are for allowable purposes and are supported by appropriate documentation.(c) The commission shall maintain an inventory of the balancing accounts established pursuant to this section.(d) The commission shall require the public utility to record all related costs and revenues in the balancing account, unless those costs or revenues are specifically exempted by the commission.(e) The commission shall adopt balancing account review or audit procedures that are consistent with a risk-based approach.(f) The commission may forgo the review or audit of a balancing account pursuant to this section if an independent auditor has reviewed or audited the balancing account in the preceding five years.(g) The commission shall annually determine if each balancing account established pursuant to this section has achieved its intended purpose in the previous year. If the commission determines that the intended purpose of a balancing account has not been achieved and those costs should not be subject to recovery in the next general rate case, the commission shall deny the public utility recovery of those costs and other expenses and shall reduce the authority of the public utility to use, or close, the balancing account in order to limit future rate increases, consistent with Section 739.14.
SEC. 2. Section 792.5 of the Public Utilities Code is amended to read:
### SEC. 2.
792.5. (a) Whenever the commission authorizes any change in rates reflecting and passing through to customers specific changes in costs, except rates set for common carriers, the commission shall require as a condition of the order that the public utility establish and maintain a balancing account reflecting the balance, whether positive or negative, between the related costs and revenues, and the commission shall take into account by appropriate adjustment or other action any positive or negative balance remaining in the balancing account at the time of any subsequent rate adjustment.(b) The commission shall develop a risk-based approach for reviewing or auditing balancing accounts periodically to ensure that the transactions recorded in the balancing accounts are for allowable purposes and are supported by appropriate documentation.(c) The commission shall maintain an inventory of the balancing accounts established pursuant to this section.(d) The commission shall require the public utility to record all related costs and revenues in the balancing account, unless those costs or revenues are specifically exempted by the commission.(e) The commission shall adopt balancing account review or audit procedures that are consistent with a risk-based approach.(f) The commission may forgo the review or audit of a balancing account pursuant to this section if an independent auditor has reviewed or audited the balancing account in the preceding five years.(g) The commission shall annually determine if each balancing account established pursuant to this section has achieved its intended purpose in the previous year. If the commission determines that the intended purpose of a balancing account has not been achieved and those costs should not be subject to recovery in the next general rate case, the commission shall deny the public utility recovery of those costs and other expenses and shall reduce the authority of the public utility to use, or close, the balancing account in order to limit future rate increases, consistent with Section 739.14.
792.5. (a) Whenever the commission authorizes any change in rates reflecting and passing through to customers specific changes in costs, except rates set for common carriers, the commission shall require as a condition of the order that the public utility establish and maintain a balancing account reflecting the balance, whether positive or negative, between the related costs and revenues, and the commission shall take into account by appropriate adjustment or other action any positive or negative balance remaining in the balancing account at the time of any subsequent rate adjustment.(b) The commission shall develop a risk-based approach for reviewing or auditing balancing accounts periodically to ensure that the transactions recorded in the balancing accounts are for allowable purposes and are supported by appropriate documentation.(c) The commission shall maintain an inventory of the balancing accounts established pursuant to this section.(d) The commission shall require the public utility to record all related costs and revenues in the balancing account, unless those costs or revenues are specifically exempted by the commission.(e) The commission shall adopt balancing account review or audit procedures that are consistent with a risk-based approach.(f) The commission may forgo the review or audit of a balancing account pursuant to this section if an independent auditor has reviewed or audited the balancing account in the preceding five years.(g) The commission shall annually determine if each balancing account established pursuant to this section has achieved its intended purpose in the previous year. If the commission determines that the intended purpose of a balancing account has not been achieved and those costs should not be subject to recovery in the next general rate case, the commission shall deny the public utility recovery of those costs and other expenses and shall reduce the authority of the public utility to use, or close, the balancing account in order to limit future rate increases, consistent with Section 739.14.
792.5. (a) Whenever the commission authorizes any change in rates reflecting and passing through to customers specific changes in costs, except rates set for common carriers, the commission shall require as a condition of the order that the public utility establish and maintain a balancing account reflecting the balance, whether positive or negative, between the related costs and revenues, and the commission shall take into account by appropriate adjustment or other action any positive or negative balance remaining in the balancing account at the time of any subsequent rate adjustment.(b) The commission shall develop a risk-based approach for reviewing or auditing balancing accounts periodically to ensure that the transactions recorded in the balancing accounts are for allowable purposes and are supported by appropriate documentation.(c) The commission shall maintain an inventory of the balancing accounts established pursuant to this section.(d) The commission shall require the public utility to record all related costs and revenues in the balancing account, unless those costs or revenues are specifically exempted by the commission.(e) The commission shall adopt balancing account review or audit procedures that are consistent with a risk-based approach.(f) The commission may forgo the review or audit of a balancing account pursuant to this section if an independent auditor has reviewed or audited the balancing account in the preceding five years.(g) The commission shall annually determine if each balancing account established pursuant to this section has achieved its intended purpose in the previous year. If the commission determines that the intended purpose of a balancing account has not been achieved and those costs should not be subject to recovery in the next general rate case, the commission shall deny the public utility recovery of those costs and other expenses and shall reduce the authority of the public utility to use, or close, the balancing account in order to limit future rate increases, consistent with Section 739.14.
792.5. (a) Whenever the commission authorizes any change in rates reflecting and passing through to customers specific changes in costs, except rates set for common carriers, the commission shall require as a condition of the order that the public utility establish and maintain a balancing account reflecting the balance, whether positive or negative, between the related costs and revenues, and the commission shall take into account by appropriate adjustment or other action any positive or negative balance remaining in the balancing account at the time of any subsequent rate adjustment.
(b) The commission shall develop a risk-based approach for reviewing or auditing balancing accounts periodically to ensure that the transactions recorded in the balancing accounts are for allowable purposes and are supported by appropriate documentation.
(c) The commission shall maintain an inventory of the balancing accounts established pursuant to this section.
(d) The commission shall require the public utility to record all related costs and revenues in the balancing account, unless those costs or revenues are specifically exempted by the commission.
(e) The commission shall adopt balancing account review or audit procedures that are consistent with a risk-based approach.
(f) The commission may forgo the review or audit of a balancing account pursuant to this section if an independent auditor has reviewed or audited the balancing account in the preceding five years.
(g) The commission shall annually determine if each balancing account established pursuant to this section has achieved its intended purpose in the previous year. If the commission determines that the intended purpose of a balancing account has not been achieved and those costs should not be subject to recovery in the next general rate case, the commission shall deny the public utility recovery of those costs and other expenses and shall reduce the authority of the public utility to use, or close, the balancing account in order to limit future rate increases, consistent with Section 739.14.
SEC. 3. Section 910.7 of the Public Utilities Code is amended to read:910.7. The commission shall annually provide the Legislature with an update on the status of its review of public utilities balancing accounts pursuant to Section 792.5. The update shall include the amount of funds in, and the expenditures from, each balancing account for each public utility. The commission shall provide this update as part of its annual report published pursuant to Section 910 or by posting it in a conspicuous area of its Internet Web site, internet website, or both.
SEC. 3. Section 910.7 of the Public Utilities Code is amended to read:
### SEC. 3.
910.7. The commission shall annually provide the Legislature with an update on the status of its review of public utilities balancing accounts pursuant to Section 792.5. The update shall include the amount of funds in, and the expenditures from, each balancing account for each public utility. The commission shall provide this update as part of its annual report published pursuant to Section 910 or by posting it in a conspicuous area of its Internet Web site, internet website, or both.
910.7. The commission shall annually provide the Legislature with an update on the status of its review of public utilities balancing accounts pursuant to Section 792.5. The update shall include the amount of funds in, and the expenditures from, each balancing account for each public utility. The commission shall provide this update as part of its annual report published pursuant to Section 910 or by posting it in a conspicuous area of its Internet Web site, internet website, or both.
910.7. The commission shall annually provide the Legislature with an update on the status of its review of public utilities balancing accounts pursuant to Section 792.5. The update shall include the amount of funds in, and the expenditures from, each balancing account for each public utility. The commission shall provide this update as part of its annual report published pursuant to Section 910 or by posting it in a conspicuous area of its Internet Web site, internet website, or both.
910.7. The commission shall annually provide the Legislature with an update on the status of its review of public utilities balancing accounts pursuant to Section 792.5. The update shall include the amount of funds in, and the expenditures from, each balancing account for each public utility. The commission shall provide this update as part of its annual report published pursuant to Section 910 or by posting it in a conspicuous area of its Internet Web site, internet website, or both.
SEC. 4. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.
SEC. 4. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.
SEC. 4. No reimbursement is required by this act pursuant to Section 6 of Article XIIIB of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because this act creates a new crime or infraction, eliminates a crime or infraction, or changes the penalty for a crime or infraction, within the meaning of Section 17556 of the Government Code, or changes the definition of a crime within the meaning of Section 6 of Article XIIIB of the California Constitution.
### SEC. 4.
It is the intent of the Legislature to enact legislation regarding local publicly owned electric utility service resource adequacy and reliability.