law15077

Chapter 077

2015 -- H 5923
Enacted 06/17/2015

A N A C T

RELATING TO PUBLIC UTILITIES AND CARRIERS

Introduced By: Representative Cale P. Keable

Date Introduced: March 18, 2015

It is enacted by the General Assembly as follows:

SECTION 1. Section 39-1-27.3 of the General Laws in Chapter 39-1 entitled "Public

Utilities Commission" is hereby amended to read as follows:

39-1-27.3. Electric distribution companies required to provide retail access,

standard offer and last resort service. -- required to provide retail access, standard offer

and last-resort service. -- (a) To promote economic development and the creation and

preservation of employment opportunities within the state, each electric distribution company,

except Pascoag utility district, a quasi-municipal corporation, district, and subdivision of the

state ("electric distribution company"), shall offer retail access from nonregulated power

producers to all customers.

(b) Through year 2009, and effective July 1, 2007, through year 2020, each electric

distribution company shall arrange for a standard power supply offer ("standard offer") to

customers that have not elected to enter into power supply arrangements with other nonregulated

power suppliers. The rates that are charged by the electric distribution company to customers

for standard offer service shall be approved by the commission and shall be designed to recover

the electric distribution company's costs and no more than the electric distribution company's

costs; provided, that the commission may establish and/or implement a rate that averages the

costs over periods of time. The electric distribution company shall not be entitled to recover any

profit margin on the sale of standard offer power, except with approval of the commission as may

be necessary to implement, fairly and effectively, system reliability and least-cost procurement.

The electric distribution company will be entitled to recover its costs incurred from providing

the standard offer arising out of: (1) wholesale Wholesale standard offer supply agreements with

power suppliers in effect prior to January 1, 2002; (2) power Power supply arrangements that are

approved by the commission after January 1, 2002; (3) power Power supply arrangements made

pursuant to §§ 39-1-27.3.1 and 39-1-27.8; and (4) any other power supply related arrangements

prudently made after January 1, 2002, to provide standard offer supply or to mitigate standard

offer supply costs, including costs for system reliability, procurement, and least-cost

procurement, as provided for in § 39-1-27.7. Subject to commission approval, the electric

distribution company may enter into financial contracts designed to hedge fuel-related or other

variable costs associated with power supply arrangements and the costs of any such financial

contracts shall be recoverable in standard offer rates. The electric distribution company's

standard offer revenues and its standard offer costs shall be accounted for and reconciled with

interest at least annually. Except as otherwise may be directed by the commission in order to

accomplish purposes established by law, any over recoveries shall be refunded to customers in a

manner directed by the commission, and any under recoveries shall be recovered by the electric

distribution company through a uniform adjustment factor approved by the commission. The

commission shall have the discretion to apply such adjustment factor in any given instance to all

customers or to such specific class of customers that the commission deems equitable under the

circumstances provided that the distribution company recovers any under recovery in its entirety.

Once a customer has elected to enter into a power supply arrangement with a nonregulated power

producer, the electric distribution company shall not be required to arrange for the standard

offer to such customer except as provided in § 39-1-27.3.1. No customer who initially elects the

standard offer and then chooses an alternative supplier shall be required to pay any withdrawal

fee or penalty to the provider of the standard offer unless such a penalty or withdrawal fee was

agreed to as part of a contract; however, no residential customer shall be required to pay a penalty

or withdrawal fee for choosing an alternative supplier. Nothing in this subsection shall be

construed to restrict the right of any nonregulated power producer to offer to sell power to

customers at a price comparable to that of the standard offer specified pursuant to this subsection.

The electric distribution company may not terminate an existing standard offer wholesale

supply agreement without the written consent of the division.

company shall arrange for a last resort last-resort power supply for customers who have left the

standard offer for any reason and are not otherwise receiving electric service from nonregulated

power producers. The electric distribution company shall procure last resort last-resort service

supply from wholesale power suppliers. Prior to acquiring last resort last-resort supply, the

electric distribution company will file with the commission a supply acquisition plan or plans

that include the acquisition procedure, the pricing options being sought, and a proposed term of

service for which last resort last-resort service will be acquired. The term of service may be

short or long term short- or long-term and acquisitions may occur from time to time and for

more than one supplier for segments of last resort last-resort service load over different terms, if

appropriate. All the components of the acquisition plans, however, shall be subject to commission

review and approval. Once an acquisition plan is approved by the commission, the electric

distribution company shall be authorized to acquire last resort last-resort service supply

consistent with the approved acquisition plan and recover its costs incurred from providing last

resort last-resort service pursuant to the approved acquisition plan. The commission may

periodically review the acquisition plan to determine whether it should be prospectively modified

due to changed market conditions. The commission shall have the authority and discretion to

approve special tariff conditions and rates proposed by the electric distribution company that

the commission finds are in the public interest, including without limitation: (1) short or long

term Short- or long-term optional service at different rates; (2) term Term commitments or

notice provisions before individual customers leave last resort last-resort service; (3) last resort

Last-resort service rates for residential or any other special class of customers that are different

than the rates for other last resort last-resort customers; and/or (4) last resort Last-resort

service rates that are designed to encourage any class of customers to return to the market. The

electric distribution company's last resort last-resort service revenues and its last resort last-

resort service costs shall be accounted for and reconciled with interest at least annually. Any over

recoveries shall be refunded and any under recoveries shall be recovered by the electric

distribution company through a uniform adjustment factor approved by the commission. The

commission shall have the discretion to apply such adjustment factor in any given instance to all

customers or to such specific class of customers that the commission deems equitable under the

circumstances provided that the distribution company recovers any under recovery in its entirety.

Nothing in this section shall be construed to prohibit an electric distribution company from

terminating service provided hereunder in accordance with commission rules and regulations in

the event of nonpayment of this service. The commission may promulgate regulations to

implement this section including the terms and conditions upon which last resort last-resort

service is offered and provided to customers.

(d) If a customer being served by a nonregulated power producer pays any taxes assessed

for electric service to the electric distribution company and the electric distribution company

forwards such tax payment for the power portion of the bill to a nonregulated power producer for

payment by the nonregulated power producer to the state, neither the customer nor the electric

distribution company shall be liable for such taxes forwarded if the nonregulated power

producer fails to remit such taxes to the state for any reason.

SECTION 2. Sections 45-58-3 and 45-58-8 of the General Laws in Chapter 45-58

entitled "Pascoag Utility District" are hereby amended to read as follows:

45-58-3. Statement of purpose. -- This chapter is intended to: (1) establish Establish

the Pascoag utility district as the successor to the utility functions fulfilled prior to April 4, 2001,

by the Pascoag fire district; (2) provide Provide for the orderly separation and transfer of those

utility functions and related utility assets and utility bond obligations (without impairment

thereof) from the Pascoag fire district to the utility district; (3) provide Provide for the retention

and fulfillment of the fire protection functions and fire protection assets of the Pascoag fire

district by the fire district; and (4) authorize Authorize and enable the utility district to provide

additional utility services, function as a nonregulated power producer and otherwise to contribute

to the development of effective competition in the state's electricity and communications

industries, in accordance with the legislature's findings as to the efficacy of competition in the

Utility Restructuring Act of 1996, as amended, and to provide such other utility products and

services as may be authorized, from time to time, by the utility district's board of utility

commissioners.

45-58-8. Powers of the Utility District. -- The utility district shall have the power:

(1) To acquire real or personal property and tangible or intangible personal property by

voluntary purchase from the owner or owners of the property, and to the extent that the board of

utility commissioners deems it advisable, to acquire property held by a corporation through

acquisition of the stock of the corporation and dissolution of the corporation;

(2) To acquire real property, fixtures, and rights and interests in real property within its

utility service area by eminent domain, subject to the supervision of the public utilities

commission in the manner prescribed in § 39-1-31;

(3) To own, operate, maintain, repair, improve, enlarge, and extend, in accordance with

the provisions of this chapter, any property acquired under this section all of which, together with

the acquisition of the property, are hereby declared to be public purposes;

(4) To produce, purchase, acquire, distribute, and sell water and electricity at wholesale

or retail within or without its utility service area subject to franchise rights of other utilities; to lay

down, construct, own, operate, maintain, repair, and improve mains, pipes, wells, towers, and

other equipment and facilities necessary, appropriate or useful for those purposes; and to contract

with others for any or all of the foregoing purposes;

(5) To produce, buy, sell, and trade electric capability, power, or energy products or

services at wholesale or retail; to purchase for its own use or for resale electric transmission

service and ancillary services; and to engage in any other transaction with respect to electricity or

electricity products that was heretofore authorized for the Pascoag fire district or investor-owned

electric companies operating as domestic electric utilities with within the state (including

participation in generating facilities as authorized by chapter 20 of title 39); provided, that the

utility district shall operate and be subject to regulation of its retail rates for electricity under title

39 of the general laws when operating within its utility service area;

(6) To operate as a nonregulated power producer within the meaning and contemplation

of § 39-1-2(19) when engaging in the sale of electricity at retail outside of its utility service area;

(7)(6) To acquire, own, lease, operate, maintain, repair, and expand facilities and

equipment necessary, appropriate, or useful to the operation of other utilities, including, but not

limited to, communications services such as internet service, high speed high-speed data

transfer, local and long distance long-distance telephone service, community antenna television

service, and to engage in the operation of such utilities;

(8)(7) To sue and be sued;

(9)(8) To adopt and alter a corporate seal;

(10)(9) To acquire, hold, use, lease, sell, transfer, assign, or otherwise dispose of any

property, real, personal, or mixed, or any interest therein, for its corporate purposes, and to

mortgage, pledge, or lease any such property;

(11)(10) To make and adopt bylaws for the management and regulation of its affairs;

(12)(11) To borrow money for any of the purposes or powers granted to it under or by

operation of this chapter, including the creation and maintenance of working capital, and to issue

negotiable bonds, notes, or other obligations, to fund or refund the same, and to secure the

obligation of such bond, notes, or other obligations in any case by pledge of, or security interest

in, the revenues and property of the utility district.

(13)(12) To fix rates (subject to the requirements of title 39 of the general laws in the

case of retail electric rates within its utility service area) and collect charges for the use of the

facilities or services rendered by or any commodities furnished by the utility district;

(14)(13) To contract in its own name for any lawful purpose which that would

effectuate the purposes and provisions of this chapter; to execute all instruments necessary to

carry out the purposes of this chapter; and to do all things necessary or convenient to carry into

effect and operation the powers granted by this chapter; and

(15)(14) Until, and only until, such time as those utility bond obligations to which the

Pascoag utility district succeeds under or by operation of this chapter shall have been retired,

defeased, or otherwise satisfied in their entirety, to levy property tax assessments upon property

owners within its utility service area for the purpose of supporting utility bond obligations of the

Pascoag fire district outstanding as of April 4, 2001, in the same manner and to the same extent as

the Pascoag fire district was authorized to do so under the act passed at the May session 1887,

entitled "An Act to Incorporate the Pascoag Fire District" as thereafter amended and

supplemented from time to time.

SECTION 3. This act shall take effect upon passage.

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LC001960

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