The term California Public Utilities Commission (CPUC) relates to a semi-executive agency, which works under the California state government. The commission serves as a regulatory body to manage the operations of the privately-owned electric, water, telecommunications, natural gas, railroad, passenger transportation, and rail transit companies.
What is the California Public Utilities Commission (CPUC)?
The commission comprises of five commissioners. The governor appoints these commissioners and the state Senate confirms their appointment. The executive director serves as the administrative head of CPUC.
The responsibility of an executive director is to monitor the day-to-day operations. All five Commissioners and other members of the California Public Utilities Commission work as a team to ensure the safety of consumers and offer them utility services at reasonable rates.
The commission guards the interests of consumers against fraud and helps to improve the overall economy of the state of California. The unique requirement of becoming a public utility commissioner is that such a person doesn’t have a financial interest or any type of relationship with a utility.
Nevertheless, commissioners should also fulfill the basic requirements associated with civil service employment. The applicant should be a resident of the state. The person applying for the post of the commissioner shouldn’t be a convicted felon or a member of the Communist Party.
Each commissioner serves for a six-year term. The CPUC carries out the agency’s business, which includes proposing and implementing utility rate changes.
Commission also promotes implementation of conservation programs, safety and service standards. Apart from this, the commission also investigates into the anti-competitive or unlawful practices followed by regulated utilities.
The California State Legislature also regulates the commission by passing regulatory laws. These laws find their place in the ‘California Public Utilities Code’. The CPUC Headquarters is located in San Francisco. Besides, regional offices of CPUC are also operating in Sacramento and Los Angeles.
The number of employees working in the California Public Utilities Commission is 1000, which includes engineers, judges, analysts, auditors, and lawyers. The legislature is capable of removing a commissioner on the charges of incompetence, corruption or neglect of duty. In order to do so, the legislature requires two-thirds votes of both the houses.
What Does the California Public Utilities Commission Do?
The basic purpose of CPUC is to make regulation and enforce them on the public utilities operating in the state. The Commission plays the role of both quasi-executive and quasi-judicial body. When it comes to enforcing the regulations, the commission serves as a quasi-legislative.
On the other hand, when the CPUC holds hearings and runs case proceedings, it turns out to be the quasi-judicial body. The Commission enforces consumer protection and safety laws, investigates complaints and approves the rate changes.
A large number of administrative law judges also serve as an integral part of the commission. These judges perform the duty of facilitating alternative dispute resolution and conduct hearings.
California Solar Initiative
The California Public Utilities Commission oversees the California Solar Initiative (CSI). This program offers incentives for solar system installations. These installations must work for one of the three investor-owned utilities (IOUs) owned by the state.
These IOUs include San Diego Gas and Electric (SDG&E), Pacific Gas and Electric Company (PG&E), and Southern California Edison (SCE). The upfront incentives offered by CSI program are for the installations of solar systems on existing residential and new/existing commercial or agricultural properties.
The CSI program is a way to achieve the goal of installing 1,800 MW of new solar systems. The design of the CSI Program is in line with the economy of California solar market. With the growth of the solar market, it is possible to lower the cost of solar system installation.
There were ten programmatic incentive level steps, for which, CPUC divided the overall megawatt goal. The commission assigned a target capacity during the progress of each step and offered an incentive depending on cents per-kilowatt-hour or dollars per-watt.
California Public Utilities Commission Examples
In order to elaborate the CPUC with an example, let’s suppose an applicant who states that the utility is not permitted to sell electricity in the California wholesale energy market. As a result, the parties show their accord in interconnecting the project with existing Distribution System of SCE.
The agreement should fall under the rules for interconnection passed by SCE. When the California Public Utility Commission (CPUC) also approves these rule it commonly refers to as “Rule 21”.
The buyer must seek the prior approval of CPUC by providing the requested information to the CPUC. The seller can help the buyer while seeking approval through some reasonable efforts.
In case of a refusal, the buyer is not capable of filing an appeal or to challenge the decision of CPUC regarding modifications or conditions, which are unacceptable to either party.
In some cases, it is possible that the future legislation or any type of regulatory change can increase the jurisdiction of the CPUC or enforce some other limitations on the parties.
The damages that the state of California, California Public Utilities Commission (CPUC) and the Energy Commission are not liable to pay for include:
- Lost profit
- Lost savings or revenue
- Facilities, or services
- Lost goodwill
- Cost of capital
- Lost use of the deliverable or any associated equipment
- Cost of any substitute equipment
- The claims of third parties including customers
- Injury to property
Waiver of Consequential Damages
In no event, the California Public Utilities Commission, the Energy Commission, or the state of California will be liable for any incidental, special or consequential damages relying on the following aspects.
- Breach of contract
- Breach of warranty
- Strict tort
- Any other legal theory for the disclosure of the contractor’s confidential information
Conclusion on the California Public Utilities Commission (CPUC) Definition
The California Public Utilities Commission acts as a regulatory body for the investor-owned utilities i.e electric, water, telecommunications, natural gas and some other privately-owned companies serving in the state.
The commissioners work rigorously to protect the rights of consumers and prevent any instance of corruption or fraud. The CPUC oversees all the operations carried out by the utilities and approves the rate change.
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