AB2611 - Electrical rates: credits: hot climate zones.

Amended IN Assembly April 09, 2026 CALIFORNIA LEGISLATURE— 2025–2026 REGULAR SESSION Assembly Bill No. 2611 Introduced by Assembly Member Bains February 20, 2026 An act to add 739.20 to amend Sections 748.5 and 748.5.5 of the Public Utilities Code, relating to electricity. LEGISLATIVE COUNSEL'S DIGEST AB 2611, as amended, Bains. Electrical rate schedules: hardships: rates: credits: hot climate zones. Existing law requires the Public Utilities Commission to designate a baseline quantity of gas and electricity that is necessary to supply a significant portion of the reasonable energy needs of the average residential customer. Existing law requires every electrical corporation and gas corporation to file a schedule of rates and charges providing baseline rates, as provided. Existing law requires the commission, in establishing residential electrical and gas rates, including baseline rates, to ensure that the rates are sufficient to enable the electrical corporation or gas corporation to recover a just and reasonable amount of revenue from residential customers as a class, while observing the principle that electricity and gas services are necessities, for which a low affordable rate is desirable, as provided. This bill would require the commission to ensure that each electrical rate schedule does not cause an unreasonable hardship on public schools, or economically vulnerable residential customers, in hot climate zones, as specified. The bill would define several terms for that purpose, including, among others, “unreasonable hardship” to mean an electrical rate schedule that imposes a rate on a public school or economically vulnerable residential customer above the baseline rate during any hour when the temperature is above 90 degrees Fahrenheit for the duration of the hour, as provided. Existing law vests the Public Utilities Commission (PUC) with regulatory authority over public utilities, including electrical corporations, while local publicly owned electric utilities are under the direction of their governing boards. The California Global Warming Solutions Act of 2006 requires the State Air Resources Board to adopt regulations for greenhouse gas emissions limits and emissions reduction measures to achieve the maximum technologically feasible and cost-effective reductions in greenhouse gas emissions in furtherance of achieving the statewide greenhouse gas emissions limit, as defined. The act authorizes the state board to revise regulations or adopt additional regulations to further the act. The act authorizes that state board to include in those regulations the use of a market-based compliance mechanism to comply with those regulations. Existing law requires the PUC to require revenues received by an electrical corporation as a result of the direct allocation of greenhouse gas allowances to electrical corporations pursuant to the regulations that implement the market-based compliance mechanism to be credited directly to the residential customers of the electrical corporation, as provided. This bill would require the PUC to determine, and to require an electrical corporation to provide, an additional credit to the residential customers of the electrical corporation in hot climate zones, including, but not limited to, specified building climate zones as determined by the State Energy Resources Conservation and Development Commission (Energy Commission), as provided. The bill would require the PUC to calculate the credit with the intent to mitigate the impact of tiered rates during extremely hot days, as defined. Existing law requires a local publicly owned electric utility that receives a direct allocation of greenhouse gas allowances in addition to the greenhouse gas allowance totals specified in the regulations that implement the market-based compliance mechanism to provide a credit, as provided. This bill would require the PUC to determine, and a local publicly owned electric utility to provide, an additional credit to ratepayers in hot climate zones, including, but not limited to, specified building climate zones as determined by the Energy Commission, as provided. By imposing additional duties on a local publicly owned electric utility, the bill would impose a state-mandated local program. The bill would require the PUC to calculate the credit with the intent to mitigate the impact of tiered rates during extremely hot days, as defined. Under existing law, a violation of any order, decision, rule, direction, demand, or requirement of the commission is a crime. Because a violation of a commission action implementing this bill’s requirements 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. 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 with regard to certain mandates no reimbursement is required by this act for a specified reason. With regard to any other mandates, this bill would provide that, if the Commission on State Mandates determines that the bill contains costs so mandated by the state, reimbursement for those costs shall be made pursuant to the statutory provisions noted above. Digest Key Vote: MAJORITY Appropriation: NO Fiscal Committee: YES Local Program: YES Bill Text The people of the State of California do enact as follows: SECTION 1. Section 748.5 of the Public Utilities Code is amended to read: 748.5. (a) (1) Except as provided in subdivisions (c), (d), and (e), the commission shall require revenues, including any accrued interest, received by an electrical corporation as a result of the direct allocation of greenhouse gas allowances to electric utilities pursuant to subdivision (b) of Section 95890 of Title 17 of the California Code of Regulations to be credited directly to the residential customers of the electrical corporation. (2) Small business, emissions-intensive, trade-exposed retail customers of the electrical corporation that are covered entities under the regulations adopted pursuant to Section 38562 of the Health and Safety Code, and emissions-intensive, trade-exposed retail customers of the electrical corporation that are not covered entities under the regulations adopted pursuant to Section 38562 of the Health and Safety Code, may also be credited from the revenues in paragraph (1), as determined by the commission. (3) The credits provided to residential customers of an electrical corporation shall be provided on the bills of those customers in no more than four high-billed months of each year to maximize customer electric bill affordability, or as otherwise directed by the commission to address extreme, unforeseen, and temporary circumstances. (b) (1) Not later than January 1, 2013, the commission shall require the adoption and implementation of a customer outreach plan for each electrical corporation, including, but not limited to, such measures as notices in bills and through media outlets, for purposes of obtaining the maximum feasible public awareness of the crediting of greenhouse gas allowance revenues. Costs associated with the implementation of this plan are subject to recovery in rates pursuant to Section 454. (2) Not later than January 1, 2027, the commission shall require each electrical corporation to update the customer outreach plan developed pursuant to paragraph (1) to include a statement at the top of customer bills in applicable months specifying the amount of money saved on a utility bill in that month and attributing those savings to the climate credit and the California Cap-and-Invest Program. (c) The commission may allocate up to 15 percent of the revenues, including any accrued interest, received by an electrical corporation as a result of the direct allocation of greenhouse gas allowances to electrical distribution utilities pursuant to subdivision (b) of Section 95890 of Title 17 of the California Code of Regulations, for clean energy and energy efficiency projects established pursuant to statute that are administered by the electrical corporation, or a qualified third-party administrator as approved by the commission, and that are not otherwise funded by another funding source. This subdivision shall become inoperative on July 1, 2026. (d) (1) The commission shall require an electrical corporation to annually remit to the State Treasury 5 percent of the revenues, including any accrued interest, received by the electrical corporation as a result of the direct allocation of greenhouse gas allowances to electrical distribution utilities pursuant to subdivision (b) of Section 95890 of Title 17 of the California Code of Regulations for deposit in into the California Transmission Accelerator Revolving Fund, pursuant to Section 63049.72 of the Government Code. This paragraph shall become operative on July 1, 2026, and shall become inoperative on July 1, 2031. (2) The revenues deposited in into the fund shall be available to the California Infrastructure and Economic Development Bank for purposes of the California Transmission Accelerator Revolving Fund Program established pursuant to Sections 63049.71 to 63049.73, inclusive, of the Government Code. (e) (1) In addition to the credit provided to residential customers of an electrical corporation pursuant to subdivision (a), the commission shall determine, and require an electrical corporation to provide, an additional credit to residential customers of the electrical corporation in hot climate zones, including, but not limited to, building climate zones 10, 11, 12, 13, 14, and 15, as determined by the Energy Commission in the California Energy Code (Part 6 of Title 24 of the California Code of Regulations). (2) The commission shall calculate the additional credit in paragraph (1) with the intent to mitigate the impact of tiered rates during extremely hot days, defined as days with temperatures above 95 degrees Fahrenheit. SEC. 2. Section 748.5.5 of the Public Utilities Code is amended to read: 748.5.5. (a) A local publicly owned electric utility that receives an allowance allocation in addition to the allowance totals specified in Section 95892 of Title 17 of the California Code of Regulations pursuant to subparagraph (B) of paragraph (1) of subdivision (b) of Section 38562 of the Health and Safety Code shall provide a credit in an amount equal to the total value of that additional allocation directly to ratepayers. This section does not limit the acceptable uses, as specified in paragraph (3) of subdivision (d) of Section 95892 of Title 17 of the California Code of Regulations, of other allowances allocated to local publicly owned electric utilities. (b) (1) In addition to the credit provided to ratepayers pursuant to subdivision (a), the commission shall determine, and a local publicly owned electric utility shall provide, an additional credit to residential customers in hot climate zones, including, but not limited to, building climate zones 10, 11, 12, 13, 14, and 15, as determined by the Energy Commission in the California Energy Code (Part 6 of Title 24 of the California Code of Regulations). (2) The commission shall calculate the additional credit in paragraph (1) with the intent to mitigate the impact of tiered rates during extremely hot days, defined as days with temperatures above 95 degrees Fahrenheit. (b) (c) A local publicly owned electric utility shall report to the State Air Resources Board on the uses of all revenues, including any accrued interest, received by that local publicly owned electric utility as a result of the direct allocation of greenhouse gas allowances to electric utilities pursuant to subdivision (b) of Section 95890 of Title 17 of the California Code of Regulations. (c) (d) Notwithstanding Section 10231.5 of the Government Code, the State Air Resources Board shall annually submit a report to the Legislature on the uses of revenues specified in subdivision (b) in accordance with Section 9795 of the Government Code. SEC. 3. No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution for certain costs that may be incurred by a local agency or school district because, in that regard, 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 XIII B of the California Constitution. However, if the Commission on State Mandates determines that this act contains other costs mandated by the state, reimbursement to local agencies and school districts for those costs shall be made pursuant to Part 7 (commencing with Section 17500) of Division 4 of Title 2 of the Government Code. SECTION 1. Section 739.20 is added to the Public Utilities Code , to read: 739.20. (a) For purposes of this section, all of the following definitions apply: (1) “Economically vulnerable residential customer” means a customer that is eligible for the California Alternate Rates for Energy (CARE) program described in Section 739.1 or the Family Electric Rate Assistance (FERA) program described in Section 739.12, regardless of whether the customer is enrolled in the CARE program or the FERA program. (2) “Hot climate zone” means zone 10, 11, 12, 13, 14, or 15, as determined by the Energy Commission in the building climate zones established in Part 6 of Title 24 of the California Code of Regulations, or any additional climate zone as determined by the Energy Commission. (3) “Public school” means a school operated by a school district, county office of education, a charter school, or a community college district. (4) “Unreasonable hardship” means an electrical rate schedule that imposes a rate on a public school or economically vulnerable residential customer above the baseline rate during any hour when the temperature is above 90 degrees Fahrenheit for the duration of the hour, as determined by the National Weather Service. (b) The commission shall ensure that each electrical rate schedule does not impose an unreasonable hardship on a public schools or economically vulnerable residential customer in a hot climate zone. (c) This section supplements, and does not supplant, the baseline quantity of electricity identified in Section 739. SEC. 2. No reimbursement is required by this act pursuant to Section 6 of Article XIII B of the California Constitution because the only costs that may be incurred by a local agency or school district will be incurred because thi [Text truncated for display. Full text available on Congress.gov.]