Amended IN Senate March 26, 2025 CALIFORNIA LEGISLATURE 20252026 REGULAR SESSION Senate Bill No. 500Introduced by Senator SternFebruary 19, 2025An act to amend Section 25233 of, and to add Section 25302.8 to, the Public Resources Code, relating to energy. An act to add Section 399.10 to the Public Utilities Code, relating to electricity.LEGISLATIVE COUNSEL'S DIGESTSB 500, as amended, Stern. Energy: reliability planning assessment: integrated energy policy report. Electrical corporations: performance metrics and incentives.Existing law vests the Public Utilities Commission with regulatory authority over public utilities, including electrical corporations. Under existing law, it is the policy of the state that each electrical corporation continue to operate its electric distribution grid in its service territory and to do so in a safe, reliable, efficient, and cost-effective manner.This bill would require the commission to evaluate performance metrics and financial performance-based incentives to identify mechanisms that may serve to better align electrical corporation operations, expenditures, and investments with delivering safe and reliable electrical service and achieving public policy goals, while minimizing costs for ratepayers. The bill would require the commission to prioritize performance metrics and financial performance-based incentives that can reduce electrical corporations preference for investments that can be added to their ratebase and instead encourage electrical corporations to propose the most cost-effective solutions for providing safe and reliable electrical service, as provided. The bill would require the commission, on or before January 1, 2028, to begin tracking one or more of the performance metrics identified, and to subsequently consider whether financial performance-based incentives linked to those performance metrics would be effective and beneficial for minimizing costs for ratepayers. Under existing law, a violation of the Public Utilities Act or an 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 a violation of a commission action implementing the requirements of the bill 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.Existing law requires the State Energy Resources Conservation and Development Commission (Energy Commission) and the Public Utilities Commission (PUC), on or before December 15, 2022, and quarterly thereafter, to submit to the Legislature a joint Reliability Planning Assessment that, among other things, includes prospective information on existing and expected resources, including updates on the interconnection status for renewable projects and any delays in interconnection, and expected retirements for both system and local resources. Existing law requires the Energy Commission to report in the energy almanac on California energy resources that serve load in California.This bill would require that the assessment also include the status of utility transmission upgrades and electrical grid infrastructure capacity, PUC approvals of applications for certificates of public convenience and necessity and permits to construct utility and independent projects, and applications for permits for projects from the Energy Commission and the queue of projects from the Independent System Operator, include the expected completion dates for both system and local resources, and report on the use of fossil fuel by certain facilities constructed by, purchased by, or under contract with the Department of Water Resources, as specified. The bill would require the Energy Commission to quarterly publish on its internet website and update a tracking energy development dashboard that synthesizes and publishes the information included in the assessment and reported on California energy resources in the energy almanac.Existing law requires the Energy Commission, on a biennial basis, to adopt an integrated energy policy report containing an overview of major trends and issues facing the state. Existing law requires the report to include an assessment and forecast of system reliability and the need for resource additions, efficiency, and conservation that considers all aspects of energy industries and markets that are essential for the state economy, general welfare, public health and safety, energy diversity, and protection of the environment.This bill would require the Energy Commission to ensure that the demand forecasts in the integrated energy policy report and wind and solar energy generation profiles account for increased weather variability, interactive weather effects, and increased likelihood of heat events, including multiday events, due to climate change, and to use the demand forecasts and those energy generation profiles to inform its energy planning, as specified.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NOYES Bill TextThe people of the State of California do enact as follows:SECTION 1. Section 399.10 is added to the Public Utilities Code, to read:399.10. (a) The commission, in a new or existing public proceeding, shall evaluate performance metrics and financial performance-based incentives to identify mechanisms that may serve to better align an electrical corporations operations, expenditures, and investments with delivering safe and reliable electrical service and achieving public policy goals, while minimizing costs for ratepayers.(b) The commission shall prioritize performance metrics and financial performance-based incentives that can reduce electrical corporations preference for investments that can be added to their ratebase and instead encourage electrical corporations to propose the most cost-effective solutions for providing safe and reliable electrical service, including consideration of all of the following:(1) Supporting load growth with existing transmission and distribution infrastructure and avoiding new capital investment, whenever feasible and cost effective, through the use of time-of-use rates, virtual powerplant procurement, or other demand flexibility programs that avoid or reduce the need for infrastructure upgrades while maintaining safety standards.(2) When expansion of transmission and distribution infrastructure cannot be avoided, choosing the most cost-effective options for achieving that needed expansion, such as through the use of grid-enhancing technologies and distribution-connected generation and energy storage facilities.(3) When investment is required to improve the safety of transmission and distribution infrastructure, choosing the most cost-effective way to achieve a reasonable level of risk reduction, such as through the use of covered conductors and fast-trip technologies to reduce the risk of ignitions as alternatives to undergrounding electrical lines.(c) On or before January 1, 2028, the commission shall begin tracking one or more of the performance metrics identified pursuant to this section and shall subsequently consider whether financial performance-based incentives linked to those performance metrics would be effective and beneficial for minimizing costs for ratepayers. SEC. 2. 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.Section 25233 of the Public Resources Code is amended to read:25233.(a)Notwithstanding Section 10231.5 of the Government Code, on or before December 15, 2022, and quarterly thereafter, the commission and the Public Utilities Commission shall submit a joint Reliability Planning Assessment to the Legislature in accordance with Section 9795 of the Government Code.(1)The assessment shall identify estimates for the electrical supply and demand balance, for the forward 5- and 10-year periods, under high-, medium-, and low-risk scenarios. The assessment shall identify loads and resources online and loads and resources expected by reliability year ending September 30.(2)The assessment shall focus on the Independent System Operator system, with an emphasis on the electrical demand, load, supply, or resources for load-serving entities subject to the Public Utilities Commissions jurisdiction. The assessment shall break down loads and resources by type of load-serving entity by year by transmission access charge area.(3)The assessment shall include information about imports, by amount, source if known, and other relevant factors, and transmission capacity for imports by date and transmission access area or balancing authority.(4)The commission shall provide an estimate for the loads and resources for the entities that are not subject to the Public Utilities Commissions jurisdiction that are part of the Independent System Operator system supply and demand balance.(5)The assessment shall include prospective information on existing and expected resources, including updates on the interconnection status for renewable projects and any delays in interconnection, the status of utility transmission upgrades and electrical grid infrastructure capacity, including substations and expanded transmission in existing corridors, the status of Public Utilities Commission approvals of applications for certificates of public convenience and necessity and permits to construct utility and independent projects, the status of applications for permits for projects from the commission and the queue of projects from the Independent System Operator, filtered by geographic region and energy resource type, and expected completion dates and retirements for both system and local resources. This shall include updates based on actions taken directly by, or as a result of, the Tracking Energy Development Task Force. The assessment shall include an accompanying Gantt chart to track progress.(6)The assessment shall maintain confidentiality of market sensitive information.(7)The assessment shall rely upon the most recently available integrated energy policy report prepared pursuant to Section 25302 for the demand assessment.(8)The assessment shall report on any other significant delays or barriers affecting timely deployment of renewable energy and zero-carbon resources, including, but not limited to, supply chain disruptions, land use restrictions, and permitting processes.(9)The assessment shall make recommendations to the Legislature on actions needed to resolve any delays or barriers reported in the assessment.(10)The assessment shall report on any regulatory barriers and challenges to increasing deployment of other preferred resources, including energy efficiency and demand response programs.(11)The assessment shall report on the use of fossil fuel by a facility constructed by, purchased by, or under contract with the Department of Water Resources pursuant to subdivision (a) of, or paragraph (1) of subdivision (b) of, Section 80710 of the Water Code.(b)The commission shall continue to report on California energy resources that serve load in California in the energy almanac. The commission shall expand the energy almanac report to include storage resources that serve wholesale load. The commission shall report on energy resources that serve load in the Independent System Operator system, which is a subset of its current reporting of all California resources, and may include energy resources located outside the state.(c)The commission shall quarterly publish on its internet website and update a tracking energy development dashboard that synthesizes and publishes the information included in the assessments submitted and reports made, pursuant to this section.SEC. 2.Section 25302.8 is added to the Public Resources Code, to read:25302.8.The commission shall ensure that the demand forecasts in the integrated energy policy report required pursuant to Section 25302 and wind and solar energy generation profiles account for increased weather variability, interactive weather effects, and increased likelihood of heat events, including multiday events, due to climate change. The demand forecasts shall include an estimate of weather-normal peak electrical demand and of peak electrical demand expected to occur given the increased likelihood of heat events due to climate change. The commission shall use the demand forecasts and wind and solar energy generation profiles to inform its energy planning in the state beginning with the first integrated energy policy report adopted after January 1, 2026.
Amended IN Senate March 26, 2025 CALIFORNIA LEGISLATURE 20252026 REGULAR SESSION Senate Bill No. 500Introduced by Senator SternFebruary 19, 2025An act to amend Section 25233 of, and to add Section 25302.8 to, the Public Resources Code, relating to energy. An act to add Section 399.10 to the Public Utilities Code, relating to electricity.LEGISLATIVE COUNSEL'S DIGESTSB 500, as amended, Stern. Energy: reliability planning assessment: integrated energy policy report. Electrical corporations: performance metrics and incentives.Existing law vests the Public Utilities Commission with regulatory authority over public utilities, including electrical corporations. Under existing law, it is the policy of the state that each electrical corporation continue to operate its electric distribution grid in its service territory and to do so in a safe, reliable, efficient, and cost-effective manner.This bill would require the commission to evaluate performance metrics and financial performance-based incentives to identify mechanisms that may serve to better align electrical corporation operations, expenditures, and investments with delivering safe and reliable electrical service and achieving public policy goals, while minimizing costs for ratepayers. The bill would require the commission to prioritize performance metrics and financial performance-based incentives that can reduce electrical corporations preference for investments that can be added to their ratebase and instead encourage electrical corporations to propose the most cost-effective solutions for providing safe and reliable electrical service, as provided. The bill would require the commission, on or before January 1, 2028, to begin tracking one or more of the performance metrics identified, and to subsequently consider whether financial performance-based incentives linked to those performance metrics would be effective and beneficial for minimizing costs for ratepayers. Under existing law, a violation of the Public Utilities Act or an 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 a violation of a commission action implementing the requirements of the bill 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.Existing law requires the State Energy Resources Conservation and Development Commission (Energy Commission) and the Public Utilities Commission (PUC), on or before December 15, 2022, and quarterly thereafter, to submit to the Legislature a joint Reliability Planning Assessment that, among other things, includes prospective information on existing and expected resources, including updates on the interconnection status for renewable projects and any delays in interconnection, and expected retirements for both system and local resources. Existing law requires the Energy Commission to report in the energy almanac on California energy resources that serve load in California.This bill would require that the assessment also include the status of utility transmission upgrades and electrical grid infrastructure capacity, PUC approvals of applications for certificates of public convenience and necessity and permits to construct utility and independent projects, and applications for permits for projects from the Energy Commission and the queue of projects from the Independent System Operator, include the expected completion dates for both system and local resources, and report on the use of fossil fuel by certain facilities constructed by, purchased by, or under contract with the Department of Water Resources, as specified. The bill would require the Energy Commission to quarterly publish on its internet website and update a tracking energy development dashboard that synthesizes and publishes the information included in the assessment and reported on California energy resources in the energy almanac.Existing law requires the Energy Commission, on a biennial basis, to adopt an integrated energy policy report containing an overview of major trends and issues facing the state. Existing law requires the report to include an assessment and forecast of system reliability and the need for resource additions, efficiency, and conservation that considers all aspects of energy industries and markets that are essential for the state economy, general welfare, public health and safety, energy diversity, and protection of the environment.This bill would require the Energy Commission to ensure that the demand forecasts in the integrated energy policy report and wind and solar energy generation profiles account for increased weather variability, interactive weather effects, and increased likelihood of heat events, including multiday events, due to climate change, and to use the demand forecasts and those energy generation profiles to inform its energy planning, as specified.Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: NOYES
Amended IN Senate March 26, 2025
Amended IN Senate March 26, 2025
CALIFORNIA LEGISLATURE 20252026 REGULAR SESSION
Senate Bill
No. 500
Introduced by Senator SternFebruary 19, 2025
Introduced by Senator Stern
February 19, 2025
An act to amend Section 25233 of, and to add Section 25302.8 to, the Public Resources Code, relating to energy. An act to add Section 399.10 to the Public Utilities Code, relating to electricity.
LEGISLATIVE COUNSEL'S DIGEST
## LEGISLATIVE COUNSEL'S DIGEST
SB 500, as amended, Stern. Energy: reliability planning assessment: integrated energy policy report. Electrical corporations: performance metrics and incentives.
Existing law vests the Public Utilities Commission with regulatory authority over public utilities, including electrical corporations. Under existing law, it is the policy of the state that each electrical corporation continue to operate its electric distribution grid in its service territory and to do so in a safe, reliable, efficient, and cost-effective manner.This bill would require the commission to evaluate performance metrics and financial performance-based incentives to identify mechanisms that may serve to better align electrical corporation operations, expenditures, and investments with delivering safe and reliable electrical service and achieving public policy goals, while minimizing costs for ratepayers. The bill would require the commission to prioritize performance metrics and financial performance-based incentives that can reduce electrical corporations preference for investments that can be added to their ratebase and instead encourage electrical corporations to propose the most cost-effective solutions for providing safe and reliable electrical service, as provided. The bill would require the commission, on or before January 1, 2028, to begin tracking one or more of the performance metrics identified, and to subsequently consider whether financial performance-based incentives linked to those performance metrics would be effective and beneficial for minimizing costs for ratepayers. Under existing law, a violation of the Public Utilities Act or an 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 a violation of a commission action implementing the requirements of the bill 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.Existing law requires the State Energy Resources Conservation and Development Commission (Energy Commission) and the Public Utilities Commission (PUC), on or before December 15, 2022, and quarterly thereafter, to submit to the Legislature a joint Reliability Planning Assessment that, among other things, includes prospective information on existing and expected resources, including updates on the interconnection status for renewable projects and any delays in interconnection, and expected retirements for both system and local resources. Existing law requires the Energy Commission to report in the energy almanac on California energy resources that serve load in California.This bill would require that the assessment also include the status of utility transmission upgrades and electrical grid infrastructure capacity, PUC approvals of applications for certificates of public convenience and necessity and permits to construct utility and independent projects, and applications for permits for projects from the Energy Commission and the queue of projects from the Independent System Operator, include the expected completion dates for both system and local resources, and report on the use of fossil fuel by certain facilities constructed by, purchased by, or under contract with the Department of Water Resources, as specified. The bill would require the Energy Commission to quarterly publish on its internet website and update a tracking energy development dashboard that synthesizes and publishes the information included in the assessment and reported on California energy resources in the energy almanac.Existing law requires the Energy Commission, on a biennial basis, to adopt an integrated energy policy report containing an overview of major trends and issues facing the state. Existing law requires the report to include an assessment and forecast of system reliability and the need for resource additions, efficiency, and conservation that considers all aspects of energy industries and markets that are essential for the state economy, general welfare, public health and safety, energy diversity, and protection of the environment.This bill would require the Energy Commission to ensure that the demand forecasts in the integrated energy policy report and wind and solar energy generation profiles account for increased weather variability, interactive weather effects, and increased likelihood of heat events, including multiday events, due to climate change, and to use the demand forecasts and those energy generation profiles to inform its energy planning, as specified.
Existing law vests the Public Utilities Commission with regulatory authority over public utilities, including electrical corporations. Under existing law, it is the policy of the state that each electrical corporation continue to operate its electric distribution grid in its service territory and to do so in a safe, reliable, efficient, and cost-effective manner.
This bill would require the commission to evaluate performance metrics and financial performance-based incentives to identify mechanisms that may serve to better align electrical corporation operations, expenditures, and investments with delivering safe and reliable electrical service and achieving public policy goals, while minimizing costs for ratepayers. The bill would require the commission to prioritize performance metrics and financial performance-based incentives that can reduce electrical corporations preference for investments that can be added to their ratebase and instead encourage electrical corporations to propose the most cost-effective solutions for providing safe and reliable electrical service, as provided. The bill would require the commission, on or before January 1, 2028, to begin tracking one or more of the performance metrics identified, and to subsequently consider whether financial performance-based incentives linked to those performance metrics would be effective and beneficial for minimizing costs for ratepayers.
Under existing law, a violation of the Public Utilities Act or an 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 a violation of a commission action implementing the requirements of the bill 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.
Existing law requires the State Energy Resources Conservation and Development Commission (Energy Commission) and the Public Utilities Commission (PUC), on or before December 15, 2022, and quarterly thereafter, to submit to the Legislature a joint Reliability Planning Assessment that, among other things, includes prospective information on existing and expected resources, including updates on the interconnection status for renewable projects and any delays in interconnection, and expected retirements for both system and local resources. Existing law requires the Energy Commission to report in the energy almanac on California energy resources that serve load in California.
This bill would require that the assessment also include the status of utility transmission upgrades and electrical grid infrastructure capacity, PUC approvals of applications for certificates of public convenience and necessity and permits to construct utility and independent projects, and applications for permits for projects from the Energy Commission and the queue of projects from the Independent System Operator, include the expected completion dates for both system and local resources, and report on the use of fossil fuel by certain facilities constructed by, purchased by, or under contract with the Department of Water Resources, as specified. The bill would require the Energy Commission to quarterly publish on its internet website and update a tracking energy development dashboard that synthesizes and publishes the information included in the assessment and reported on California energy resources in the energy almanac.
Existing law requires the Energy Commission, on a biennial basis, to adopt an integrated energy policy report containing an overview of major trends and issues facing the state. Existing law requires the report to include an assessment and forecast of system reliability and the need for resource additions, efficiency, and conservation that considers all aspects of energy industries and markets that are essential for the state economy, general welfare, public health and safety, energy diversity, and protection of the environment.
This bill would require the Energy Commission to ensure that the demand forecasts in the integrated energy policy report and wind and solar energy generation profiles account for increased weather variability, interactive weather effects, and increased likelihood of heat events, including multiday events, due to climate change, and to use the demand forecasts and those energy generation profiles to inform its energy planning, as specified.
## Digest Key
## Bill Text
The people of the State of California do enact as follows:SECTION 1. Section 399.10 is added to the Public Utilities Code, to read:399.10. (a) The commission, in a new or existing public proceeding, shall evaluate performance metrics and financial performance-based incentives to identify mechanisms that may serve to better align an electrical corporations operations, expenditures, and investments with delivering safe and reliable electrical service and achieving public policy goals, while minimizing costs for ratepayers.(b) The commission shall prioritize performance metrics and financial performance-based incentives that can reduce electrical corporations preference for investments that can be added to their ratebase and instead encourage electrical corporations to propose the most cost-effective solutions for providing safe and reliable electrical service, including consideration of all of the following:(1) Supporting load growth with existing transmission and distribution infrastructure and avoiding new capital investment, whenever feasible and cost effective, through the use of time-of-use rates, virtual powerplant procurement, or other demand flexibility programs that avoid or reduce the need for infrastructure upgrades while maintaining safety standards.(2) When expansion of transmission and distribution infrastructure cannot be avoided, choosing the most cost-effective options for achieving that needed expansion, such as through the use of grid-enhancing technologies and distribution-connected generation and energy storage facilities.(3) When investment is required to improve the safety of transmission and distribution infrastructure, choosing the most cost-effective way to achieve a reasonable level of risk reduction, such as through the use of covered conductors and fast-trip technologies to reduce the risk of ignitions as alternatives to undergrounding electrical lines.(c) On or before January 1, 2028, the commission shall begin tracking one or more of the performance metrics identified pursuant to this section and shall subsequently consider whether financial performance-based incentives linked to those performance metrics would be effective and beneficial for minimizing costs for ratepayers. SEC. 2. 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.Section 25233 of the Public Resources Code is amended to read:25233.(a)Notwithstanding Section 10231.5 of the Government Code, on or before December 15, 2022, and quarterly thereafter, the commission and the Public Utilities Commission shall submit a joint Reliability Planning Assessment to the Legislature in accordance with Section 9795 of the Government Code.(1)The assessment shall identify estimates for the electrical supply and demand balance, for the forward 5- and 10-year periods, under high-, medium-, and low-risk scenarios. The assessment shall identify loads and resources online and loads and resources expected by reliability year ending September 30.(2)The assessment shall focus on the Independent System Operator system, with an emphasis on the electrical demand, load, supply, or resources for load-serving entities subject to the Public Utilities Commissions jurisdiction. The assessment shall break down loads and resources by type of load-serving entity by year by transmission access charge area.(3)The assessment shall include information about imports, by amount, source if known, and other relevant factors, and transmission capacity for imports by date and transmission access area or balancing authority.(4)The commission shall provide an estimate for the loads and resources for the entities that are not subject to the Public Utilities Commissions jurisdiction that are part of the Independent System Operator system supply and demand balance.(5)The assessment shall include prospective information on existing and expected resources, including updates on the interconnection status for renewable projects and any delays in interconnection, the status of utility transmission upgrades and electrical grid infrastructure capacity, including substations and expanded transmission in existing corridors, the status of Public Utilities Commission approvals of applications for certificates of public convenience and necessity and permits to construct utility and independent projects, the status of applications for permits for projects from the commission and the queue of projects from the Independent System Operator, filtered by geographic region and energy resource type, and expected completion dates and retirements for both system and local resources. This shall include updates based on actions taken directly by, or as a result of, the Tracking Energy Development Task Force. The assessment shall include an accompanying Gantt chart to track progress.(6)The assessment shall maintain confidentiality of market sensitive information.(7)The assessment shall rely upon the most recently available integrated energy policy report prepared pursuant to Section 25302 for the demand assessment.(8)The assessment shall report on any other significant delays or barriers affecting timely deployment of renewable energy and zero-carbon resources, including, but not limited to, supply chain disruptions, land use restrictions, and permitting processes.(9)The assessment shall make recommendations to the Legislature on actions needed to resolve any delays or barriers reported in the assessment.(10)The assessment shall report on any regulatory barriers and challenges to increasing deployment of other preferred resources, including energy efficiency and demand response programs.(11)The assessment shall report on the use of fossil fuel by a facility constructed by, purchased by, or under contract with the Department of Water Resources pursuant to subdivision (a) of, or paragraph (1) of subdivision (b) of, Section 80710 of the Water Code.(b)The commission shall continue to report on California energy resources that serve load in California in the energy almanac. The commission shall expand the energy almanac report to include storage resources that serve wholesale load. The commission shall report on energy resources that serve load in the Independent System Operator system, which is a subset of its current reporting of all California resources, and may include energy resources located outside the state.(c)The commission shall quarterly publish on its internet website and update a tracking energy development dashboard that synthesizes and publishes the information included in the assessments submitted and reports made, pursuant to this section.SEC. 2.Section 25302.8 is added to the Public Resources Code, to read:25302.8.The commission shall ensure that the demand forecasts in the integrated energy policy report required pursuant to Section 25302 and wind and solar energy generation profiles account for increased weather variability, interactive weather effects, and increased likelihood of heat events, including multiday events, due to climate change. The demand forecasts shall include an estimate of weather-normal peak electrical demand and of peak electrical demand expected to occur given the increased likelihood of heat events due to climate change. The commission shall use the demand forecasts and wind and solar energy generation profiles to inform its energy planning in the state beginning with the first integrated energy policy report adopted after January 1, 2026.
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 399.10 is added to the Public Utilities Code, to read:399.10. (a) The commission, in a new or existing public proceeding, shall evaluate performance metrics and financial performance-based incentives to identify mechanisms that may serve to better align an electrical corporations operations, expenditures, and investments with delivering safe and reliable electrical service and achieving public policy goals, while minimizing costs for ratepayers.(b) The commission shall prioritize performance metrics and financial performance-based incentives that can reduce electrical corporations preference for investments that can be added to their ratebase and instead encourage electrical corporations to propose the most cost-effective solutions for providing safe and reliable electrical service, including consideration of all of the following:(1) Supporting load growth with existing transmission and distribution infrastructure and avoiding new capital investment, whenever feasible and cost effective, through the use of time-of-use rates, virtual powerplant procurement, or other demand flexibility programs that avoid or reduce the need for infrastructure upgrades while maintaining safety standards.(2) When expansion of transmission and distribution infrastructure cannot be avoided, choosing the most cost-effective options for achieving that needed expansion, such as through the use of grid-enhancing technologies and distribution-connected generation and energy storage facilities.(3) When investment is required to improve the safety of transmission and distribution infrastructure, choosing the most cost-effective way to achieve a reasonable level of risk reduction, such as through the use of covered conductors and fast-trip technologies to reduce the risk of ignitions as alternatives to undergrounding electrical lines.(c) On or before January 1, 2028, the commission shall begin tracking one or more of the performance metrics identified pursuant to this section and shall subsequently consider whether financial performance-based incentives linked to those performance metrics would be effective and beneficial for minimizing costs for ratepayers.
SECTION 1. Section 399.10 is added to the Public Utilities Code, to read:
### SECTION 1.
399.10. (a) The commission, in a new or existing public proceeding, shall evaluate performance metrics and financial performance-based incentives to identify mechanisms that may serve to better align an electrical corporations operations, expenditures, and investments with delivering safe and reliable electrical service and achieving public policy goals, while minimizing costs for ratepayers.(b) The commission shall prioritize performance metrics and financial performance-based incentives that can reduce electrical corporations preference for investments that can be added to their ratebase and instead encourage electrical corporations to propose the most cost-effective solutions for providing safe and reliable electrical service, including consideration of all of the following:(1) Supporting load growth with existing transmission and distribution infrastructure and avoiding new capital investment, whenever feasible and cost effective, through the use of time-of-use rates, virtual powerplant procurement, or other demand flexibility programs that avoid or reduce the need for infrastructure upgrades while maintaining safety standards.(2) When expansion of transmission and distribution infrastructure cannot be avoided, choosing the most cost-effective options for achieving that needed expansion, such as through the use of grid-enhancing technologies and distribution-connected generation and energy storage facilities.(3) When investment is required to improve the safety of transmission and distribution infrastructure, choosing the most cost-effective way to achieve a reasonable level of risk reduction, such as through the use of covered conductors and fast-trip technologies to reduce the risk of ignitions as alternatives to undergrounding electrical lines.(c) On or before January 1, 2028, the commission shall begin tracking one or more of the performance metrics identified pursuant to this section and shall subsequently consider whether financial performance-based incentives linked to those performance metrics would be effective and beneficial for minimizing costs for ratepayers.
399.10. (a) The commission, in a new or existing public proceeding, shall evaluate performance metrics and financial performance-based incentives to identify mechanisms that may serve to better align an electrical corporations operations, expenditures, and investments with delivering safe and reliable electrical service and achieving public policy goals, while minimizing costs for ratepayers.(b) The commission shall prioritize performance metrics and financial performance-based incentives that can reduce electrical corporations preference for investments that can be added to their ratebase and instead encourage electrical corporations to propose the most cost-effective solutions for providing safe and reliable electrical service, including consideration of all of the following:(1) Supporting load growth with existing transmission and distribution infrastructure and avoiding new capital investment, whenever feasible and cost effective, through the use of time-of-use rates, virtual powerplant procurement, or other demand flexibility programs that avoid or reduce the need for infrastructure upgrades while maintaining safety standards.(2) When expansion of transmission and distribution infrastructure cannot be avoided, choosing the most cost-effective options for achieving that needed expansion, such as through the use of grid-enhancing technologies and distribution-connected generation and energy storage facilities.(3) When investment is required to improve the safety of transmission and distribution infrastructure, choosing the most cost-effective way to achieve a reasonable level of risk reduction, such as through the use of covered conductors and fast-trip technologies to reduce the risk of ignitions as alternatives to undergrounding electrical lines.(c) On or before January 1, 2028, the commission shall begin tracking one or more of the performance metrics identified pursuant to this section and shall subsequently consider whether financial performance-based incentives linked to those performance metrics would be effective and beneficial for minimizing costs for ratepayers.
399.10. (a) The commission, in a new or existing public proceeding, shall evaluate performance metrics and financial performance-based incentives to identify mechanisms that may serve to better align an electrical corporations operations, expenditures, and investments with delivering safe and reliable electrical service and achieving public policy goals, while minimizing costs for ratepayers.(b) The commission shall prioritize performance metrics and financial performance-based incentives that can reduce electrical corporations preference for investments that can be added to their ratebase and instead encourage electrical corporations to propose the most cost-effective solutions for providing safe and reliable electrical service, including consideration of all of the following:(1) Supporting load growth with existing transmission and distribution infrastructure and avoiding new capital investment, whenever feasible and cost effective, through the use of time-of-use rates, virtual powerplant procurement, or other demand flexibility programs that avoid or reduce the need for infrastructure upgrades while maintaining safety standards.(2) When expansion of transmission and distribution infrastructure cannot be avoided, choosing the most cost-effective options for achieving that needed expansion, such as through the use of grid-enhancing technologies and distribution-connected generation and energy storage facilities.(3) When investment is required to improve the safety of transmission and distribution infrastructure, choosing the most cost-effective way to achieve a reasonable level of risk reduction, such as through the use of covered conductors and fast-trip technologies to reduce the risk of ignitions as alternatives to undergrounding electrical lines.(c) On or before January 1, 2028, the commission shall begin tracking one or more of the performance metrics identified pursuant to this section and shall subsequently consider whether financial performance-based incentives linked to those performance metrics would be effective and beneficial for minimizing costs for ratepayers.
399.10. (a) The commission, in a new or existing public proceeding, shall evaluate performance metrics and financial performance-based incentives to identify mechanisms that may serve to better align an electrical corporations operations, expenditures, and investments with delivering safe and reliable electrical service and achieving public policy goals, while minimizing costs for ratepayers.
(b) The commission shall prioritize performance metrics and financial performance-based incentives that can reduce electrical corporations preference for investments that can be added to their ratebase and instead encourage electrical corporations to propose the most cost-effective solutions for providing safe and reliable electrical service, including consideration of all of the following:
(1) Supporting load growth with existing transmission and distribution infrastructure and avoiding new capital investment, whenever feasible and cost effective, through the use of time-of-use rates, virtual powerplant procurement, or other demand flexibility programs that avoid or reduce the need for infrastructure upgrades while maintaining safety standards.
(2) When expansion of transmission and distribution infrastructure cannot be avoided, choosing the most cost-effective options for achieving that needed expansion, such as through the use of grid-enhancing technologies and distribution-connected generation and energy storage facilities.
(3) When investment is required to improve the safety of transmission and distribution infrastructure, choosing the most cost-effective way to achieve a reasonable level of risk reduction, such as through the use of covered conductors and fast-trip technologies to reduce the risk of ignitions as alternatives to undergrounding electrical lines.
(c) On or before January 1, 2028, the commission shall begin tracking one or more of the performance metrics identified pursuant to this section and shall subsequently consider whether financial performance-based incentives linked to those performance metrics would be effective and beneficial for minimizing costs for ratepayers.
SEC. 2. 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. 2. 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. 2. 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. 2.
(a)Notwithstanding Section 10231.5 of the Government Code, on or before December 15, 2022, and quarterly thereafter, the commission and the Public Utilities Commission shall submit a joint Reliability Planning Assessment to the Legislature in accordance with Section 9795 of the Government Code.
(1)The assessment shall identify estimates for the electrical supply and demand balance, for the forward 5- and 10-year periods, under high-, medium-, and low-risk scenarios. The assessment shall identify loads and resources online and loads and resources expected by reliability year ending September 30.
(2)The assessment shall focus on the Independent System Operator system, with an emphasis on the electrical demand, load, supply, or resources for load-serving entities subject to the Public Utilities Commissions jurisdiction. The assessment shall break down loads and resources by type of load-serving entity by year by transmission access charge area.
(3)The assessment shall include information about imports, by amount, source if known, and other relevant factors, and transmission capacity for imports by date and transmission access area or balancing authority.
(4)The commission shall provide an estimate for the loads and resources for the entities that are not subject to the Public Utilities Commissions jurisdiction that are part of the Independent System Operator system supply and demand balance.
(5)The assessment shall include prospective information on existing and expected resources, including updates on the interconnection status for renewable projects and any delays in interconnection, the status of utility transmission upgrades and electrical grid infrastructure capacity, including substations and expanded transmission in existing corridors, the status of Public Utilities Commission approvals of applications for certificates of public convenience and necessity and permits to construct utility and independent projects, the status of applications for permits for projects from the commission and the queue of projects from the Independent System Operator, filtered by geographic region and energy resource type, and expected completion dates and retirements for both system and local resources. This shall include updates based on actions taken directly by, or as a result of, the Tracking Energy Development Task Force. The assessment shall include an accompanying Gantt chart to track progress.
(6)The assessment shall maintain confidentiality of market sensitive information.
(7)The assessment shall rely upon the most recently available integrated energy policy report prepared pursuant to Section 25302 for the demand assessment.
(8)The assessment shall report on any other significant delays or barriers affecting timely deployment of renewable energy and zero-carbon resources, including, but not limited to, supply chain disruptions, land use restrictions, and permitting processes.
(9)The assessment shall make recommendations to the Legislature on actions needed to resolve any delays or barriers reported in the assessment.
(10)The assessment shall report on any regulatory barriers and challenges to increasing deployment of other preferred resources, including energy efficiency and demand response programs.
(11)The assessment shall report on the use of fossil fuel by a facility constructed by, purchased by, or under contract with the Department of Water Resources pursuant to subdivision (a) of, or paragraph (1) of subdivision (b) of, Section 80710 of the Water Code.
(b)The commission shall continue to report on California energy resources that serve load in California in the energy almanac. The commission shall expand the energy almanac report to include storage resources that serve wholesale load. The commission shall report on energy resources that serve load in the Independent System Operator system, which is a subset of its current reporting of all California resources, and may include energy resources located outside the state.
(c)The commission shall quarterly publish on its internet website and update a tracking energy development dashboard that synthesizes and publishes the information included in the assessments submitted and reports made, pursuant to this section.
The commission shall ensure that the demand forecasts in the integrated energy policy report required pursuant to Section 25302 and wind and solar energy generation profiles account for increased weather variability, interactive weather effects, and increased likelihood of heat events, including multiday events, due to climate change. The demand forecasts shall include an estimate of weather-normal peak electrical demand and of peak electrical demand expected to occur given the increased likelihood of heat events due to climate change. The commission shall use the demand forecasts and wind and solar energy generation profiles to inform its energy planning in the state beginning with the first integrated energy policy report adopted after January 1, 2026.