LEGISLATIVE SUBCOMMITTEE RECOMMENDATION: SUPPORT IF AMENDED
SUMMARY OF BILL:
SB 1476 imposes certain requirements (focused on customer access to "electrical or gas consumption data" and privacy of that data) on any publicly owned utility (POU) or investor owned utility (IOU) using smart meters. Such a utility must comply with the following requirements:
1. Ensure that the customer has at least one option [the default option] to access their consumption data without that customer being forced "to agree to the sharing of [their] personally identifiable information, including ... consumption data, with a third party".
2. Shall not "partner" with any third party that "facilitates" access to customer consumption data by providing an incentive or discount to the customer for accessing that data.
3. Shall not sell, release or make available customer consumption data to any third party, except in two specified circumstances:
a. The customer declines the default option (in #1) and chooses to access their data from a third party.
b. The customer expresses prior "written consent for a demand response program."
4. Use "reasonable" security procedures and practices to protect customer consumption data.
SUMMARY OF SUPPORTING ARGUMENTS FOR RECOMMENDATION:
The bill may prevent the utility or the California Public Utilities Commission (CPUC) from exercising the option in the future for eliminating or outsourcing the systems involved with accessing consumption data if circumstances indicate it may be a prudent choice in terms of cost, efficiency, or competitiveness.
The bill's prohibition language on "partnering" will likely make it more difficult for third party demand response providers to get customers interested in demand response.
The bill's broad language could impact CPUC evaluation, measurement and verification (EM&V) efforts which rely on data collection by consultants retained by CPUC for this purpose.
SUMMARY OF SUGGESTED AMENDMENTS:
Delete language prohibiting an electric utility from partnering with a third party demand response providers that provide an incentive or discount to a customer that provides access to electric or gas consumption data.
Provide the CPUC with the flexibility to determine the appropriateness of using third party demand response providers to meet customer demands or cost-effective solutions for providing consumer information or conducting necessary EM&V of utility programs.
DIVISION ANALYSIS:
The bill does not define the term "personally identifiable information," other than to state that it includes "electric or gas consumption data." Currently, all three IOUs meet the first requirement by providing their own systems for customers to access their consumption data without the customer having to rely on a third party. However, there may be at least two potential issues with the first requirement.
a) The bill appears to prevent the utility or CPUC from exercising a possible option in the future for eliminating the utility systems involved with accessing consumption data if circumstances indicate it may be a prudent choice in terms of cost and efficiency. For example, if the vast majority of the customers happen to eventually choose voluntarily to access their data through third party portals (e.g. Google), it may become expensive and inefficient for the utility to maintain the same systems in parallel for a small number of customers.
b) The bill appears to prevent [subject to interpretation] the utility from ever outsourcing the systems involved with accessing consumption data to a third party (even if cost, efficiency, or competitiveness considerations suggest such an option as prudent).
The term "partnering" is not defined and the language could adversely affect current practices. Today, there are third party demand response providers that directly enroll customers in demand response programs, often with various incentive mechanisms. These parties usually have contracts with the utility involving compensation by the utility for the aggregate demand response "delivered" by the third party demand response providers through their customers. The bill's prohibition language on partnering will likely affect such relationships and make it more difficult for these providers to get customers interested in demand response.
The term "personal identifying data" is not defined. The language regarding prohibited and permitted actions by a utility relative to customer consumption data could impact how CPUC collects data from utilities for the purpose of evaluating utility energy efficiency programs. The bill could likely further complicate CPUC measurement and evaluation efforts which are critical to the role of the CPUC as a regulatory agency.
PROGRAM BACKGROUND:
As required by SB 17 (Padilla, 2009), the CPUC is currently in Phase II of its smart grid OIR to develop smart grid deployment requirements by July 1, 2010. One of the workshops held in March, as well as comments filed by parties, included discussion of customer privacy matters and the "Fair Information Practices" and are under active consideration for adoption in the proceeding. The proceeding is also tasked by SB 17 to adopt smart grid "standards and protocols," including cybersecurity considerations.
LEGISLATIVE HISTORY:
SB 837 (Florez, 2010) addresses privacy of customer data associated with smart meters.
SB 17 (Padilla, Chapter 327, Statutes of 2009) requires the commission, by July 1, 2010, in consultation with the State Energy Resources Conservation and
Development Commission, the Independent System Operator, and other key stakeholders, to determine the requirements for a smart grid deployment plan.
STATUS:
SB 1476 is in the Assembly awaiting policy committee referral.
SUPPORT/OPPOSITION:
None on file.
STAFF CONTACTS:
Alicia Priego, Deputy Director-OGA (916) 322-8858 arp@cpuc.ca.gov
Date: June 2, 2010
BILL LANGUAGE:
BILL NUMBER: SB 1476 AMENDED
BILL TEXT
AMENDED IN SENATE APRIL 20, 2010
AMENDED IN SENATE APRIL 5, 2010
INTRODUCED BY Senator Padilla
FEBRUARY 19, 2010
An act to add Sections 387.7 and 714 to, and to repeal Section 393
of, the Public Utilities Code, relating to public utilities.
LEGISLATIVE COUNSEL'S DIGEST
SB 1476, as amended, Padilla. Public utilities: customer privacy:
advanced metering infrastructure.
(1) Under existing law, the Public Utilities Commission has
regulatory authority over public utilities, including electrical
corporations and gas corporations, as defined. The existing Public
Utilities Act requires every public utility to furnish and maintain
adequate, efficient, just, and reasonable service, instrumentalities,
equipment, and facilities as are necessary to promote the safety,
health, comfort, and convenience of its patrons, employees, and the
public.
Existing law requires the commission to conduct a pilot study of
certain customers of each electrical corporation to determine the
relative value to ratepayers of information, rate design, and
metering innovations using specified approaches, but prohibits this
data from being used for any commercial purpose, unless authorized by
the customer.
This bill would repeal the provisions relating to the study, and
would require an electrical corporation, gas corporation, or local
publicly owned electric utility that utilizes an advanced metering
infrastructure that allows a customer to access the customer's
electrical or gas consumption data , as defined, to
ensure that the customer has an option to access that data without
relinquishing personally identifiable information to a 3rd
party. The bill would require an electrical corporation, gas
corporation, or local publicly owned electric utility to keep such
consumption data securely and not accessible by a 3rd party, except
as provided being required to agree to the
sharing of his or her personally identifiable information,
including electrical or gas consumption data, with a 3rd party. The
bill would prohibit a local publicly owned electric utility,
electrical corporation, or gas corporation from sharing, selling,
disclosing, or otherwise making accessible to any 3rd party a
customer's electrical or gas consumption data, except as specified,
and would require those utilities to use reasonable security
procedures and practices to protect a customer's electrical and gas
consumption data from unauthorized access, destruction, use,
modification, or disclosure .
(2) Under existing law, a violation of any provision of the Public
Utilities Act, or of any of the rules or orders issued under the
act, is a crime.
Because the provisions of this bill are within the act, a
violation of these provisions would impose a state-mandated local
program by creating a new crime.
(3) 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.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. Section 387.7 is added to the Public Utilities Code, to
read:
387.7. (a) For purposes of this section, "electrical
consumption data" means data about a customer's electrical usage that
is made available as part of an advanced metering infrastructure.
(b) A local publicly owned electric utility
that utilizes an advanced metering infrastructure that allows a
customer to access the customer's electric
electrical consumption data shall ensure that the customer has
an option to access that data without relinquishing
personally identifiable information, including electric consumption
data, to a third party.
(b) Unless a
customer chooses to access the customer's electric consumption data,
made available as part of an advanced metering infrastructure, from a
third party after being given the option described in subdivision
(a), that data shall be securely kept by the local publicly owned
electric utility and shall not be accessible by a third party.
being required to agree to the sharing of
his or her personally identifiable information, including electrical
consumption data, with a third party. The local publicly owned
electric utility shall not partner with any third party that
facilitates access to electrical consumption data that provides an
incentive or discount to the customer for accessing their electrical
consumption data.
(c) (1) A local publicly owned electric utility shall not share,
sell, disclose, or otherwise make accessible to any third party a
customer's electrical consumption data, except as provided in
paragraph (2).
(2) A local publicly owned electric utility may make a customer's
electrical consumption data accessible to a third party in either of
the following circumstances:
(A) The customer was given the option, pursuant to subdivision
(b), to access electrical consumption data without being required to
share personally identifiable information with a third party, the
customer has declined that option, and the customer has instead
chosen, without revoking that choice, to access his or her electrical
consumption data from that third party.
(B) The electrical consumption data is accessed or shared by a
third party or local publicly owned electric utility with the
customer's prior express written consent for a demand response
program that manages the customer's consumption of electricity in
response to electrical supply or pricing conditions.
(d) A local publicly owned electric utility shall use reasonable
security procedures and practices to protect a customer's electrical
consumption data from unauthorized access, destruction, use,
modification, or disclosure.
(e) (1) Nothing in this section shall preclude a local publicly
owned electric utility from using customer aggregate electrical
consumption data for analysis, reporting, or program management if
all information has been removed regarding the individual identity of
a customer.
(2) Nothing in this section shall preclude a local publicly owned
electric utility from disclosing a customer's electrical consumption
data to a third party for billing purposes.
SEC. 2. Section 393 of the Public Utilities Code is repealed.
SEC. 3. Section 714 is added to the Public Utilities Code, to
read:
714. (a) For purposes of this section, "electrical or gas
consumption data" means data about a customer's electrical or natural
gas usage that is made available as part of an advanced metering
infrastructure.
(b) An electrical or gas corporation that
utilizes an advanced metering infrastructure that allows a customer
to access the customer's electric electrical
and gas consumption data shall ensure that the customer has an
option to access that data without relinquishing personally
identifiable information, including electric or gas consumption data,
to a third party.
(b) Unless a
customer chooses to access the customer's electric or gas consumption
data, made available as part of an advanced metering infrastructure,
from a third party after being given the option described in
subdivision (a), that data shall be securely kept by the electric or
gas corporation and shall not be accessible by a third party.
being required to agree to the sharing of his or her
personally identifiable information, including electrical or gas
consumption data, with a third party. The electrical corporation or
gas corporation shall not partner with any third party that
facilitates access to electrical or gas consumption data that
provides an incentive or discount to the customer for accessing their
electrical or gas consumption data.
(c) (1) An electrical corporation or gas corporation shall not
share, sell, disclose, or otherwise make accessible to any third
party a customer's electrical or gas consumption data, except as
provided in paragraph (2).
(2) An electrical corporation or gas corporation may make a
customer's electrical or gas consumption data accessible to a third
party in either of the following circumstances:
(A) The customer was given the option, pursuant to subdivision
(b), to access electrical or gas consumption data without being
required to share personally identifiable information with a third
party, the customer has declined that option, and the customer has
instead chosen, without revoking that choice, to access his or her
electrical or gas consumption data from that third party.
(B) The electrical or gas consumption data is accessed or shared
by a third party, electrical corporation, or gas corporation with the
customer's prior express written consent for a demand response
program that manages the customer's consumption of energy in response
to supply or pricing conditions.
(d) An electrical corporation or gas corporation shall use
reasonable security procedures and practices to protect a customer's
electrical or gas consumption data from unauthorized access,
destruction, use, modification, or disclosure.
(e) (1) Nothing in this section shall preclude an electrical
corporation or gas corporation from using customer aggregate
electrical or gas consumption data for analysis, reporting, or
program management if all information has been removed regarding the
individual identity of a customer.
(2) Nothing in this section shall preclude an electrical
corporation or gas corporation from disclosing a customer's
electrical or gas consumption data to a third party for billing
purposes.
SEC. 4. 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 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.
