An act to add Chapter 3.5 (commencing with Section 25250) to Division 15 of the Public Resources Code, and to amend Sections 706 718 and 8389 of, to add Section 8386.8 to, to add Article 4.5 (commencing with Section 570) to Chapter 3 of Part 1 of Division 1 of, and to add Chapter 10 (commencing with Section 8450) to Division 4.1 of, the Public Utilities Code, relating to energy.
SB 332, the Investor-Owned Utilities Accountability Act, would direct the California Energy Commission to hire a research institute to study whether and how California’s investor-owned electric utilities could be transitioned to a successor ownership model, such as a public entity, nonprofit public benefit corporation, or mutual benefit corporation. The study would have to examine legal, financial, governance, labor, climate, and operational issues, include an interim legal report by December 31, 2026, and be completed by January 1, 2029, with public comment on a draft and a public presentation to the Legislature by September 30, 2029. The bill caps the study cost at $5 million and frames the analysis around affordability, wildfire risk, equity, and public accountability.
The bill also makes several immediate regulatory changes affecting electrical corporations, gas corporations, and some local publicly owned utilities. It would require utilities to publicly post annual or quarterly data on service disconnections for nonpayment, payment plans, arrears, and reconnections; require each electrical corporation to submit a proposed executive compensation structure to the Public Utilities Commission by April 1, 2026; require independent triennial audits of utility equipment and lines to identify end-of-life assets; and direct the PUC to develop a best-value procurement model for electrical infrastructure materials. It also ties executive compensation and safety certification more closely to safety, affordability, wildfire mitigation, and customer arrears data.
In state-law terms, SB 332 would add a new chapter to the Public Resources Code and create new Public Utilities Code provisions while amending existing sections governing utility compensation, disconnections, and wildfire safety certification. It would expand reporting and oversight obligations for investor-owned utilities and, to a lesser extent, local publicly owned electric utilities, and it would authorize fines for failure to complete required equipment audits. The bill also declares that violations of implementing PUC actions could be crimes under the Public Utilities Act framework, which is why the bill states it creates a state-mandated local program.
The overall sentiment reflected in the bill text and vote history appears supportive but cautious. The measure advanced through committee and floor votes with majority support, but it was also placed on the suspense file and ultimately held in committee and under submission on July 14, 2025, indicating fiscal, legal, or policy concerns remained unresolved. The bill’s findings are strongly critical of investor-owned utilities, especially PG&E, SCE, and SDG&E, and the policy direction is clearly reform-oriented and utility-accountability focused.
The main points of contention are likely the bill’s scope and feasibility. Supporters appear to favor stronger oversight, affordability protections, wildfire prevention, and a serious examination of utility ownership alternatives. Potential opponents or skeptics would likely focus on the cost and complexity of the feasibility study, the implications of studying utility transition away from the investor-owned model, the new reporting and compensation mandates, and the operational burden on utilities and regulators. The bill also raises questions about labor impacts, liability allocation, financing, and whether the proposed successor-entity models are practical within existing legal and regulatory structures.
SB 332 would not immediately convert investor-owned utilities into public or nonprofit entities, but it would create a formal state process to evaluate that possibility and would add new oversight requirements for utilities in the meantime. It would amend the Public Utilities Code to require executive compensation plans tied to safety and affordability, require public disclosure of disconnection and arrears data, mandate triennial equipment audits, and direct the PUC to develop a best-value procurement model for utility infrastructure purchases. It would also add a new Public Resources Code chapter establishing the feasibility-study framework and stakeholder process for analyzing successor ownership models. These changes would affect electrical corporations, gas corporations, local publicly owned electric utilities, the Energy Commission, the PUC, and the Office of Energy Infrastructure Safety, while also creating potential enforcement and reporting obligations that could be treated as state-mandated local programs.
The bill’s tone and legislative findings are strongly critical of investor-owned utilities and supportive of exploring alternatives that prioritize affordability, safety, labor, and public accountability. The vote history suggests the measure had enough support to move through several stages, including a 25-10 Senate floor vote and a 11-5 committee vote on a later amended version, but it also encountered enough concern to be placed on suspense and then held in committee under submission. Overall, the sentiment appears mixed: ideologically favorable among supporters of utility reform, but tempered by practical and fiscal reservations among some legislators and committees.
The biggest points of contention are the bill’s breadth, cost, and implications for California’s utility system. Supporters likely see the study as a necessary step toward addressing high rates, wildfire liability, and utility accountability, while critics may question whether a $5 million study is sufficient for such a sweeping transition analysis or whether the state should be formally studying replacement of the investor-owned utility model at all. Additional controversy likely surrounds the executive compensation mandates, the required public reporting on disconnections and arrears, the audit and fine provisions, and the potential labor, financing, and liability consequences of any future ownership transition. The bill also implicates local publicly owned utilities in some reporting requirements, which could draw concern from municipal utility stakeholders.