Senate Bill 520 (SB 520) – Provider of Last Resort (POLR)
Senate Bill 520 (SB 520) legislated the CPUC to develop rules and regulation for a Provider of Last Resort (POLR) should a CCA or Energy Service Provider fail. SB 520 identified the investor-owned utility as the POLR and ordered the CPUC to insure cost recovery, continuity of service and reliability, and continuation of California’s clean energy goals. The CPUC initiated Rulemaking on March 18, 2022 to develop POLR rules (R.21-03-011) based on Senate Bill 520. The Energy Division looked at the key requirements of SB 520 as they framed their Rulemaking objectives.
The intent of SB 520 was to provide that the electrical corporation is the provider of last resort (e.g. Southern California Edison) and would establish requirements for the application and for a load-serving entity other than the electrical corporation to serve as the provider of last resort. The bill as signed into law requires the CPUC to supervise and regulate each provider of last resort, as necessary as a public utility for the services it provides as a provider of last resort to ensure the provision of electrical service to customers without disruption. Additionally, the bill requires the commission to ensure that each provider of last resort receives reasonable cost recovery for being designated and serving as the provider of last resort.
CalChoice staff is actively participating in the POLR ruling requirements and framework. It is important to share our voice with the CPUC as these rules could financially impact CalChoice cities. A main concern with the POLR Rulemaking surrounds the liquidity needs should there be a POLR event when there would be an immediate transfer of load to the POLR and the POLR would need to purchase load for the returned customers. As always, CalChoice remains committed to working with CalCCA and the CPUC Energy Division to make sure our voices are heard.