The CPUC's Emerging Issues Forum provides an opportunity for CPUC staff and industry experts to share ideas on topics outside of the CPUC's formal regulatory or rulemaking processes in the industries the Commission regulates: communications, energy, transportation, and water. The goal of the Forum is to provide proactive leadership on emerging policy issues of broad importance to the Commission, Industry and the public, and support sound, long-term policy development through independent research and analysis.
We invite members of the public to provide feedback. For general comments and questions, or to suggest issues for consideration, send an email to email@example.com. For comments on specific papers and issues presented by the Emerging Issues Forum, contact us through the comment form provided under each issue topic.
You can also join our electronic mailing list to get updates on new postings in the Emerging Issues Forum.
Evaluating Forecast Models: Water Revenue Adjustment Mechanism
Uncertainty in the urban water economy is increasing and this is creating new challenges for assuring that reliable water service is delivered at a fair and reasonable cost. Decoupled water rates and the Water Revenue Adjustment Mechanism (WRAM) have taken the first step to creating incentives to promote water conservation by assuring revenue stability for water investor-owned utilities. But in a highly uncertain and changing environment, deterministic models may not adequately represent the revenue risks that utilities are facing. This paper argues that water rates should be updated more regularly. It does not suggest re-litigating rates more often; rather it proposes that a water demand attrition mechanism is developed during the General Rate Case (GRC) proceeding.
Electric Utility Business and Regulatory Models
Various business models for the electric industry have been contemplated by stakeholders, such as one that expands the utilities’ monopoly role, a second that expands the role of a robust market facilitated by the utilities, and a third in which regulated utilities own the poles and wires and the markets do the rest. Each of the models outlines a very different role for the utility in terms of its responsibilities and activities on the electric grid. They each also challenge the market and customers to take on different roles. The Policy and Planning Division paper describes the models being considered by industry stakeholders and reviews the positive and potentially negative impacts of each model.
Comparative Analysis of Utility Services in California
This staff paper offers a comparative analysis of California’s public utility services —electricity, gas, water, and broadband—by examining the cost and usage by customers for each utility service at the ZIP code level. Using a smaller geographical level provides us a better picture of utility cost and usage in California. This also enables us to gather information and identify important relationships, patterns, and trends in each utility that could serve as a resource to inform the public and improve utility regulation by the Commission.
- MAP – The interactive map presents energy, water, and broadband services and socioeconomic data at the ZIP code level to help consumers visualize and understand what they are getting for their money, and potentially change their consumption behaviors
California’s Natural Gas System: Regulatory Response to Market Changes
This staff paper provides a brief history of the California natural gas market’s transformation over the last 30 years from a monopoly supply to a semi-competitive retail market. Special attention is paid to the timeline of the transformation: CPUC Decisions deregulating the market, whether in response to Applications filed by customers or CPUC-initiated Rulemakings and investigations, were made in response to market and consumer demand for transformation. The report discusses that this iterative regulatory response has resulted in an efficient and effective natural gas market in which large industrial customers are able to purchase and transport their own supplies, while core customers, including residential customers, benefit from regulated service at just and reasonable rates under CPUC-approved tariffs.
This paper delves into the subject of Transactive Energy; is it the new hype in the electricity world, or is it a potential solution for the problems the power grid is facing today? The paper provides a brief introduction to the concept and presents some of the angles that policymakers should be thinking about while learning and considering this new concept. The goal of the paper is neither to advocate nor dismiss transactive energy as a potential solution to grid issues, but rather to inform in non-technical terms and point out some questions from a regulator’s point of view.
Cost Allocation Mechanism
This paper is intended to be an informal first step toward a potential solution for all parties on matters related to the electricity Cost Allocation Mechanism (CAM). The CPUC's Policy & Planning Division has worked with the Assigned Commissioner’s office and the Assigned Administrative Law Judge for the Long-Term Procurement Plan proceeding (LTPP). Our collective hope is to begin an informal process led by Policy & Planning Division to gauge whether parties can come to a consensus on a possible solution regarding CAM. Since Policy & Planning Division normally does not get involved in active proceedings before the CPUC, it is more appropriate for this group to conduct the informal first step. As such, we have stated in this paper a possible solution.
A Brief Introduction to Utility Poles
This paper provides a brief overview of the rules applicable to utility poles, summarizes recent events and CPUC proceedings involving utility poles, and recommends opportunities for additional CPUC action to protect safety and continuity of service in California.
Realizing Lower Bills through Improved Standards & Technology
The analysis performed in this paper is an extension of the traditional California boast, which states that by investing in efficiency we are saving energy. As residential energy users in California have faced higher rates for electric service over the years, there has been much discussion about how total customer bills have not risen as much because of increases in energy efficiency. This paper extends the discussion beyond residential customers’ utility bills to consider the overall cost of the ultimate services customers purchase through their energy bills.
Microgrids: A Regulatory Perspective
Utilities, and their regulators, are entrusted to provide electricity that is reliable and safe, but the historical method by which that is achieved is beginning to change. Added to the imperative to provide safe and reliable electricity comes the need to be more resilient and secure in the delivery of electricity. This all needs to be done at a reasonable cost, but who will be left to pay? Microgrids are coming; and this paper discusses how utilities and regulators respond will go a long way to determining how innovation and services will impact the electric grid.
Quantifying Risk: Building Resiliency Into Utility Planning
This paper discusses quantifying risk. Improving the safety, security, and resilience of utility networks is an unassailably desirable goal. Historically, safety has been assured through compliance-based regulations. Compliance simply means conforming to a rule, such as a regulation, policy, standard, or law. Risk management is increasingly recognized as a method that regulators and utilities can use to develop more robust and strategically focused safety programs. This risk-based approach to safety regulation focuses on quantifying risk and incorporating this type of assessment and evaluation into utility and regulatory decision-making. While many of the existing regulations rely to some extent on risk management principles, a comprehensive framework is needed in order to be able to assess the overall risk profiles of utility operations and in order to enable regulators to make informed decisions on behalf of consumers.
Low Income Rates for Water Utility Customers
August 26, 2013” This paper provides an initial and preliminary calculation of what the costs of Class-A water utilities’ low income programs could be if ALL income-eligible households were to receive the low income benefits. The benefits of the low income programs, that is, the dollar amounts removed from the bills of qualifying low income customers, vary substantially among the utilities and the utility regions studied. They vary from a low of $5 per billing period to $19 in this study. The median benefit was found to be 17.5-percent of a typical bill. The cost of supporting the low income programs for the Class-A water utilities under the assumption of full participation of all qualifying households also varies substantially from service area to service area. They range from about 1.4-percent of a typical residential bill to more than 13-percent of a typical bill. The median percentage was found to be 6.9-percent.
Utility Investment Valuation Strategies: A Case for Adopting Real Options Valuation
Oct. 3, 2013: This paper takes a deeper look into how utilities make investment decisions, and recommends that utilities and regulators should consider new types of investment valuation strategies for maintenance and upgrade projects in electric and water utilities. The paper argues that the conventional way of valuing Maintain Repair and Upgrade investments implicitly undervalues them by not recognizing the value of new information and the value of managerial flexibility to react to that information.
Customers as Grid Participants: A Fundamentally New Role for Customers
May 15, 2013: This paper highlights customer segmentation as a tool to better understand customer needs. The paper’s overall intent is to discuss a paradigm shift from the historical view of utility consumers as merely ratepayers and passive recipients of electricity services to active participants in the power grid. Customer participation, more than the actions of the utilities or of the regulators, is critical to meet California’s greenhouse gas emission goals in a cost-effective manner. It represents a fundamental change in the relationship between the utility and the customer, increasing the onus on both to become partners.
Current Issues with Long-Term Resource Adequacy
Feb. 20, 2013: CPUC Staff Briefing Paper – A Review of Current Issues with Long-Term Resource Adequacy
Water Energy Nexus
This paper clarifies and further defines the energy water nexus and identifies the key issue for improving the overall efficiency of the nexus, both technical and economic efficiency. The paper recommends the challenge is more closely defined as managing the water-energy portfolio – balancing the technical constraints with the economic value of water and energy services. A portfolio management approach does not strictly rank potential opportunities, but rather balances the risks and opportunities of water and energy systems in order to achieve a broad set of objectives: such as preserving and extending the water supply, leveraging energy services to mitigate water scarcity, and reduce overall emissions.
Presentation on the Water Energy Nexus paper
Energy Data Center Briefing Paper
This Briefing Paper recommends that the CPUC open a proceeding to consider the creation of an Energy Data Center and the benefits it can offer, while staying within the confines of existing privacy statutes and CPUC rules.
Cybersecurity and Regulation
The CPUC's Grid Planning and Reliability Policy Paper on Cybersecurity and the Evolving Role of State Regulation: How it Impacts the California Public Utilities Commission.
Utility Workforce Development – Should the CPUC Play a Role in this Issue?
As the utility workforce ages and workers are leaving at a faster pace than people entering the workforce, one important question remains unanswered: Are the four investor-owned utilities regulated by the CPUC prepared and equipped to handle the potential labor shortage? This paper discusses this issue.
Pre-Pay Programs for Electricity Service
This paper reviews pre-pay programs for electricity service.
Trends in Utility Infrastructure Financing
Similar to the rest of the country, California is nearing the end of useful life of its utility infrastructure, much of which has been built over the past century. This paper will discuss three financing options that can be used to potentially reduce the cost of upgrading utility infrastructure.
Electricity Use and Income: A Review
The study of relationship between residential electricity demand and income is important as it helps to better understand welfare implications of various policies. This paper examies these issues.
Rate Case Memo
This memo discusses whether the current General Rate Case plan meets the objectives of the CPUC.
The Federal Communications Commission will soon begin considering proposals to reform both the manner in which Universal Service Fund revenues are collected from customers, and the types of services eligible for subsidy. The purpose of this paper is to identify the impacts of different reform proposals on California customers.