(a) For purposes of this article, the following terms have the following meanings:

1. (1) “Carbon-free electrical resource” means a source of electrical generation that emits no greenhouse gases when generating electricity that is deliverable to retail end-use customers in California.
2. (2) “Load-serving entity” has the same meaning as defined in Section 380.
3. (3) “Provider of last resort” means a load-serving entity that the commission determines meets the minimum requirements of this article and designates to provide electrical service to any retail customer whose service is transferred to the designated load-serving entity because the customer’s load-serving entity failed to provide, or denied, service to the customer or otherwise failed to meet its obligations.

(c) The commission may designate a load-serving entity other than the electrical corporation to serve as a provider of last resort in the electrical corporation’s service territory by approving a joint application by the electrical corporation and the load-serving entity that proposes to become the new provider of last resort in the electrical corporation’s service territory. The application may request a transfer of the responsibilities of the provider of last resort for the entire service territory of the electrical corporation or for a portion of that service territory. The application shall include all of the following:

1. (1) A demonstrated ability by the load-serving entity seeking to become the new provider of last resort to post a bond sufficient to meet the minimum threshold established pursuant to subdivision (e).
2. (2) A demonstrated history of contracting for electricity and access to carbon-free electrical resources by the load-serving entity seeking to become provider of last resort.
3. (3) A viable plan for meeting the resource adequacy requirements established pursuant to Section 380, the requirements of the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11)), and all other load-serving entity procurement requirements.
4. (4) A history of the load-serving entity seeking to become the provider of last resort participating in, and complying with the requirements of, the integrated resource planning process pursuant to Sections 454.51, 454.52, and 454.54, and all other load-serving entity procurement requirements.
5. (5) The full disclosure by the load-serving entity seeking to become the provider of last resort of any fines or penalties imposed by, or violations of law found by, any regulatory body of any state or territory, or the federal government.
6. (6) A detailed history of the safety record of the load-serving entity seeking to become the provider of last resort.
7. (7) An implementation plan to provide for universal access, equitable treatment of all classes of customers, and other customer protections including electric service disconnection procedures consistent with Sections 718 and 779.3.

(f) The commission shall develop additional threshold attributes for a load-serving entity other than an electrical corporation to serve as a provider of last resort to retail end-use customers in California that include all of the following:

1. (1) Minimum insurance requirements.
2. (2) Minimum financial requirements necessary to provide electricity to retail end-use customers in each service territory.
3. (3) Compliance with resource adequacy requirements pursuant to Section 380, requirements of the California Renewables Portfolio Standard Program (Article 16 (commencing with Section 399.11)), integrated resource planning requirements pursuant to Sections 454.51, 454.52, and 454.54, and all other state-mandated procurement requirements.
4. (4) Electric service disconnection rules pursuant to Sections 718 and 779.3.
5. (5) Any additional minimum requirements that the commission determines are needed to ensure that the provider of last resort will perform its obligation to serve.

(h) To ensure continued achievement of California’s greenhouse gas emission reduction and air quality goals, and continued accounting of emissions of greenhouse gases for California pursuant to Part 2 (commencing with Section 38530) of Division 25.5 of the Health and Safety Code and other emissions reporting programs, in preparation for an unplanned customer migration to a provider of last resort, the commission, in consultation with the Energy Commission, may do both of the following:

1. (1) Establish rules for all load-serving entities in preparation of any potentially large and unplanned customer migration.
2. (2) Recommend to agencies modifications to relevant regulations.