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| THE GENERAL ASSEMBLY OF PENNSYLVANIA |
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| SENATE BILL |
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| INTRODUCED BY BROWNE, GORDNER, BRUBAKER, ALLOWAY, RAFFERTY, WAUGH AND MUSTO, MARCH 6, 2009 |
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| REFERRED TO CONSUMER PROTECTION AND PROFESSIONAL LICENSURE, MARCH 6, 2009 |
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| AN ACT |
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1 | Amending Title 66 (Public Utilities) of the Pennsylvania |
2 | Consolidated Statutes, defining "overall rate" and "rate |
3 | phase-in plan"; and providing for rate phase-in plans. |
4 | The General Assembly of the Commonwealth of Pennsylvania |
5 | hereby enacts as follows: |
6 | Section 1. Section 102 of Title 66 of the Pennsylvania |
7 | Consolidated Statutes is amended by adding definitions to read: |
8 | § 102. Definitions. |
9 | Subject to additional definitions contained in subsequent |
10 | provisions of this part which are applicable to specific |
11 | provisions of this part, the following words and phrases when |
12 | used in this part shall have, unless the context clearly |
13 | indicates otherwise, the meanings given to them in this section: |
14 | * * * |
15 | "Overall rate." The sum of all retail rates charged by an |
16 | electric distribution company for electric service, including |
17 | all applicable riders and surcharges. |
18 | * * * |
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1 | "Rate phase-in plan" or "plan." A plan filed with the |
2 | Pennsylvania Public Utility Commission by an electric |
3 | distribution company solely to phase in any initial increase in |
4 | the rate for generation service that may occur upon the |
5 | expiration of that electric distribution company's generation |
6 | rate cap. Such plan shall not address or affect any other rate |
7 | changes filed by the electric distribution company. |
8 | * * * |
9 | Section 2. Title 66 is amended by adding a section to read: |
10 | § 2816. Rate phase-in plan. |
11 | (a) General rule.--Within 90 days of the effective date of |
12 | this section, each electric distribution company shall file a |
13 | rate phase-in plan with the commission to provide residential |
14 | and small commercial customers that take service from a default |
15 | service provider the option to phase in any initial increase in |
16 | the price for generation service that may occur upon the |
17 | expiration of the generation rate cap for such provider |
18 | specified in section 2804(4) (relating to standards for |
19 | restructuring of electric industry) or a restructuring plan in |
20 | section 2806(f) (relating to implementation, pilot programs and |
21 | performance-based rates) and ending no later than three years |
22 | after such expiration date. Customer participation in any plan |
23 | approved under this subsection shall be voluntary. |
24 | (b) Conditions.--Each rate phase-in plan shall be subject to |
25 | commission approval and shall meet the following conditions: |
26 | (1) The plan shall offer a transition to prices at the |
27 | level permitted pursuant to a commission-approved procurement |
28 | plan beginning on the expiration date of the generation rate |
29 | cap for the provider. |
30 | (2) The plan shall ensure that the initial increase in |
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1 | the rate for generation service charged to each customer |
2 | class under the plan shall be phased in in annual percentage |
3 | increases, provided that the increase in any one year shall |
4 | not exceed 15% of the overall rate in effect for that |
5 | customer class on the last day of the prior calendar year |
6 | during the three-year period specified in subsection (a). The |
7 | commission shall provide for no more than an additional |
8 | three-year period, at the option of the electric distribution |
9 | company, for the recovery of all amounts recoverable under |
10 | section 2807(e)(3) (relating to duties of electric |
11 | distribution companies) and deferred amounts with carrying |
12 | charges under this section. |
13 | (3) The plan may offer the customer the option to begin |
14 | the phase-in period prior to the expiration of the generation |
15 | rate cap, provided that the customer accrues interest on any |
16 | prepaid amount at a rate of 6% compounded annually. Customer |
17 | participation in any plan approved under this subsection |
18 | shall be voluntary. |
19 | (4) The plan shall specify the means of providing notice |
20 | to customers of the option to participate in such plan on a |
21 | voluntary basis. |
22 | (c) Recovery.--The default service provider shall fully |
23 | recover the expenses associated with implementing a plan and the |
24 | amount of the deferred payments resulting from customers' |
25 | participation in the plan and a carrying charge of 6% compounded |
26 | annually on the deferred payments from such customers by means |
27 | of a nonbypassable charge to each customer class, subject to the |
28 | conditions established under subsection (b). Such charge shall |
29 | be a reconcilable automatic adjustment charge under section 1307 |
30 | (relating to sliding scale of rates; adjustments), shall be |
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1 | applied to participating customers on a customer class basis, |
2 | shall be included in other charges on the electric distribution |
3 | company's bill and shall not appear as a separate line item on a |
4 | customer's bill. Any rate phase-in plan approved by the |
5 | commission shall be considered a new service offered for the |
6 | first time under section 2804(4)(vi). |
7 | (d) Deferred amounts.--The commission shall permit such |
8 | deferred costs and associated carrying charges to be recorded |
9 | for accounting purposes on an electric distribution company's |
10 | books of account as a regulatory asset where the electric |
11 | distribution company is the default service provider. |
12 | (e) Credit.--In the event a customer enrolled in a plan that |
13 | begins prior to the expiration of the electric distribution |
14 | company's generation rate cap leaves the default service |
15 | provider's system prior to the full distribution of amounts |
16 | collected, a credit will be applied to the customer's final bill |
17 | and any remainder shall be refunded to the customer. |
18 | (f) Intangible transition property.--An electric company's |
19 | right to recover costs under an approved phase-in plan shall be |
20 | deemed intangible transition property for the purposes of |
21 | section 2812 (relating to approval of transition bonds), but not |
22 | for any other section of Chapter 28 (relating to restructuring |
23 | of electric utility industry), and the commission is authorized |
24 | to issue a qualified rate order under section 2812 with respect |
25 | to such costs and to issue such other orders and take such |
26 | actions as may be necessary or proper for the electric |
27 | distribution company to issue transition bonds, as provided in |
28 | section 2812, secured by the electric distribution company's |
29 | right to recover such costs. |
30 | Section 3. This act shall take effect in 60 days. |
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