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The Assembly Utilities & Energy Committee on April 20 passed legislation to expand private utilities’ access to ratepayer-backed bonds and to establish an energy transition workforce office. In addition, the panel backed allowing multi-year power line undergrounding plans.

Southern California Edison and Sempra are pushing to allow investor-owned utilities to cover annual tree trimming and other operation and maintenance costs with bonds securitized 100% by ratepayers. The measure, AB 2937 by Assemblymember Lisa Calderon (D-Whittier), was approved by the energy committee on a 15-0 vote despite strenuous opposition by The Utility Reform Network.

TURN Executive Director Mark Toney objected to the legislature issuing “another credit card” to the utilities. “It is bad for ratepayers because it makes it easier” to lower current rates, but then burdens ratepayers with higher rates in the years to come, he said.

According to Toney, AB 2937 would allow SCE “to pass on $1 billion in costs” going back to 2018.

SCE lobbyist Adam Smith told lawmakers that covering operation and maintenance costs with multi-year bonds backed by ratepayers would “smooth out rates” in the short term because they would no longer be recouped on a yearly basis.

San Diego Gas & Electric lobbyist Nicola Hernandez also insisted the bill would “manage immediate rate spikes.” She said SDG&E’s costs for vegetation management and other wildfire mitigation work increased 35-40% over the last decade.

Assemblymember Jim Patterson (R-Fresno) expressed skepticism that the measure would lead to lower rates. “We are making a leap of faith here,” he said. “Rates need to come down,” not just the pace of rate increases, he insisted.

The energy committee bill analysis warned the measure “could have the effect of endorsing an expensive transaction solely on the grounds that it is rate smoothing in the near-term, despite higher long-term overall costs.”

The bill was amended to require the expansion of bonding authority to comply with existing law allowing investor-owned utilities to use customer-backed bonds to cover wildfire liability under SB 901. Specifically, it applies the law’s mandate that bonds come with the lowest possible costs, an issue heavily debated during regulatory proceedings on SCE and Pacific Gas & Electric bond proposals, which were approved by regulators.

Another successful measure would allow utilities to include multi-year undergrounding plans starting in their 2023 wildfire reduction plans. AB 2889 by Assemblymember Buffy Wicks (D-Berkeley) passed 14-0. It would direct utilities to include undergrounding plans extending seven to 10 years in their annual plans.

Undergrounding power lines in high fire-threat areas, according to PG&E Chief Risk Officer Sumeet Singh, “is the best long-term solution to keeping customers, communities and the state safe.” In addition, the costs will be spread out over the equipment’s “useful life” of 50 years, which will reduce costs to ratepayers, he noted.

The California Farm Bureau raised concerns about the costs of undergrounding, causing Assemblymember Patterson to abstain from a vote. But the lawmaker said he believed undergrounding to be a cost-effective, one-time expenditure compared to “cutting trees forever.”

Earlier in the week, the Senate energy committee passed a bill aiming to speed up the undergrounding of power lines.

Another bill would require the California Air Resources Board to share its data on battery electric, hybrid, and fuel cell vehicle fleets with investor-owned and local public utilities so they can better plan for grid expansions to accommodate increased electricity load.

“Our climate goals are not easy,” said Assemblymember Kevin McCarty (D-Sacramento), the author of AB 2700. Attaining a vehicle fleet that is primarily electric requires planning, he added.

NRDC’s representative called AB 2700, okayed on a 13-0 vote, a “critical measure” to ensure the grid is prepared to meet the state’s climate, grid and equity goals.

To date, the California Public Utilities Commission has authorized $1.53 billion of ratepayer funding for investor-owned utility charging infrastructure. Of the total amount, almost $1.23 billion is still “available because most of the projects are in the implementation or design phase,” according to the committee bill analysis.

The last bill discussed and approved was AB 2204 by Assemblymember Tasha Boerner Horvath (D-Encinitas). The measure would create a new organization to oversee the state’s transition to a carbon-neutral economy and protect fossil fuel workers who lose their jobs.

“It is imperative to hold all levels of government accountable for this transition” to reach a “better world,” Boerner Horvath said.

Passed on a 13-1 vote, the bill would create the Clean Energy Workforce Office within the Labor & Workforce Development Agency. It would help displaced fossil fuel workers and provide retraining.

As of last June 2021, there were about 113,000 people employed in fossil fuel-based industries in California, the Political Economy Research Institute reported. That includes fossil fuel-based power generation workers and those in oil and gas extraction operations and supporting businesses. Workers in this area are paid considerably more than clean energy workers, $130,00 compared to $85,000. The institute estimates about 3,200 workers will be displaced annually in California between 2021 and 2030 with another roughly 2,500 retiring annually.

The Governor’s proposed budget for 2022-23 would allocate $15 million to support a workforce training pilot for displaced oil and gas workers. There is another $50 million for a pilot to address the needs of oil and gas workers facing displacement

A measure passed without discussion was AB 2283, requiring state regulators to analyze actions PG&E has taken that have driven down the value of its stocks, harming wildfire victims that are partly compensated with stock under the court-approved bankruptcy plan in mid-2020. Under the deal, half the $13.5 compensation is to be paid in stock.