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Bills

AB 2065: Rates: inappropriate cost recovery.

  • Session Year: 2025-2026
  • House: Assembly
  • Latest Version Date: 2026-06-09

Current Status:

In Progress

(2026-06-09: From committee chair, with author's amendments: Amend, and re-refer to committee. Read second time, amended, and re-referred to Com. on E., U & C.)

Introduced

In Committee

First Chamber

In Committee

Second Chamber

Enacted

Version:

Existing law vests the Public Utilities Commission with regulatory authority over public utilities, including electrical corporations, gas corporations, water corporations, sewer system corporations, or telephone corporations. Existing law authorizes the commission to fix the rates and charges for every public utility and requires that those rates and charges be just and reasonable. Existing law prohibits a utility from recording to an above-the-line account, as defined, or otherwise recovering from ratepayers specified costs.

This bill would prohibit an electrical corporation, gas corporation, water corporation, sewer system corporation, or telephone corporation from engaging in inappropriate cost recovery by recording to an above-the-line account, as defined, a cost that meets specified criteria, including if the cost is categorically excluded from ratepayer recovery by statute, commission decision, or commission rule, exceeds the scope of the commissions authorization for the specific account or application, or has already been authorized for recovery through another ratemaking mechanism. The bill would require the commission, upon making a determination that a corporation has engaged in inappropriate cost recovery, to disallow recovery of the inappropriate cost from ratepayers and to impose a financial penalty for inappropriate cost recovery equal to the amount of the inappropriate cost recovery or 3 times that amount, except as specified.

Under existing law, a violation of the Public Utilities Act or any order, decision, rule, direction, demand, or requirement of the commission is a crime.

Because the provisions of this bill would be a part of the act and because a violation of a commission action implementing the bills 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.

Existing law requires the Energy Unit within the Governors Office of Business and Economic Development (GO-Biz), in coordination with certain entities, to establish a Transmission Infrastructure Accelerator (accelerator) and requires the accelerator to, among other things, develop a public-private partnership plan to develop financing options that maximize debt financing to reduce overall capital costs and facilitate public-private partnership development of eligible transmission projects, as defined, to achieve ratepayer savings. Existing law requires the accelerator to submit its public-private partnership plan to the Legislature on or before July 1, 2027.This bill would extend the deadline to submit that plan to December 1, 2027.

News Coverage:

AB 2065: Rates: inappropriate cost recovery. | Digital Democracy