An act to add Section 729.3 to the Public Utilities Code, relating to electricity.
AB 1787 would require the California Public Utilities Commission, if it approves a large electrical corporation’s request to upgrade its smart meter, information management, and billing systems, to require that utility to offer customers at least one optional dynamic rate tariff. The tariff would have to be available no later than one year after the upgraded smart meter system is expected to be in service. The bill is aimed at giving customers access to pricing that better reflects changing grid conditions and wholesale electricity costs, while preserving the right of customers to remain on standard service if they do not want to participate.
The bill sets minimum features for the optional tariff, including time-varying distribution rates where feasible, time-varying generation rates for bundled customers, and nonbypassable charges. It also requires near real-time access to usage data when supported by the meter technology, cybersecurity protections, standardized machine-readable customer data access, and the ability for customers to authorize third-party energy management providers. The Public Utilities Commission would also have to establish rules for data management, privacy, and cybersecurity, and consult with the Federal Energy Regulatory Commission to avoid conflicts with federal transmission ratemaking authority.
AB 1787 would add Section 729.3 to the Public Utilities Code and create new obligations for the Public Utilities Commission and large electrical corporations with more than 100,000 service connections. It would condition approval of smart meter upgrade cost recovery on customer data access, cybersecurity, and anti-cost-shift protections, and it would require the commission to review and mitigate any cost shifting between participating and nonparticipating customers at least every four years. The bill also addresses bundled and unbundled customers, load-serving entities, community choice aggregators, electric service providers, and eligible customer-generators, while preserving existing limits on commission authority over CCAs and electric service providers.
The bill appears to have generally favorable support in committee, as reflected by the 13-0 vote to do pass as amended and re-refer it to Appropriations. The bill’s findings frame dynamic pricing as a way to lower bills, improve demand flexibility, and better align rates with grid conditions. The absence of recorded committee testimony in the provided materials limits insight into broader stakeholder views, but the vote suggests no visible opposition at that stage.
The main points of contention built into the bill are consumer protection and cost allocation. The bill tries to balance support for dynamic pricing with safeguards for customers who cannot or do not want to participate, including vulnerable residential customers, and with rules intended to prevent nonparticipants from subsidizing participants. Another likely area of concern is data access and privacy, since the bill requires near real-time usage data sharing, standardized machine-readable access, and third-party access authorization, all subject to cybersecurity and privacy standards. There is also a jurisdictional issue because the bill requires consultation with FERC to avoid conflict with federal transmission ratemaking authority and expressly avoids expanding CPUC authority over community choice aggregators and electric service providers.