Electricity: rates: optional dynamic rate tariffs.

Assembly Member Schultz's proposal to modernize California's electricity rate structures directs the Public Utilities Commission to develop optional dynamic rate tariffs for customers of large electrical corporations. The measure establishes a phased implementation, requiring tariff options for medium and large commercial customers by July 2028, followed by residential and small commercial customers by July 2030.

Each dynamic rate tariff must include time-varying distribution rates reflecting grid constraints, time-varying generation rates based on wholesale market conditions for bundled customers, and nonbypassable charges. The commission may also authorize time-varying transmission rates when consistent with federal regulations. Customers with smart meters who opt into these tariffs receive direct access to their real-time usage data, enabling informed consumption decisions.

The legislation contains specific provisions to prevent cost shifts between customer groups. Any over-collection of revenue requirements from participating bundled customers must be returned to those customers, while participating customers bear the burden of any under-collection. Similar protections apply to unbundled customers regarding transmission and distribution charges. The commission must evaluate potential cost impacts on non-participating customers through periodic reviews and incorporate the effects of dynamic rate adoption when determining revenue requirements.