PRINTER'S NO. 693
No. 625 Session of 1983
INTRODUCED BY LLOYD, KUKOVICH, MAIALE, MORRIS, DeWEESE, MRKONIC,
HALUSKA, TIGUE, PISTELLA, EVANS, JAROLIN, KOSINSKI, HOEFFEL,
D. R. WRIGHT, BELFANTI AND DeLUCA, MARCH 23, 1983
REFERRED TO COMMITTEE ON CONSUMER AFFAIRS, MARCH 23, 1983
AN ACT
1 Amending Title 66 (Public Utilities) of the Pennsylvania
2 Consolidated Statutes, regulating construction costs and
3 limiting rate increases.
4 The General Assembly of the Commonwealth of Pennsylvania
5 hereby enacts as follows:
6 Section 1. Title 66 of the Pennsylvania Consolidated
7 Statutes is amended by adding a section to read:
8 § 514. Construction cost of electric generating units.
9 (a) Submission of estimate.--No later than 30 days after
10 construction of an electric generating unit is begun, either in
11 this Commonwealth or in some other state, any public utility
12 operating in this Commonwealth and owning any share in that unit
13 shall submit to the commission an estimate of the cost of
14 constructing that unit. If the public utility acquires ownership
15 of any share in an electric generating unit which is under
16 construction on the date of acquisition, the public utility
17 shall, within 30 days of the date of acquisition, submit the
18 latest estimate of the cost of constructing that unit which was
1 formulated no later than 30 days from the beginning of
2 construction.
3 (b) Alternative submission.--Subsection (a) shall not apply
4 whenever a public utility is required under another provision of
5 this part to submit an estimate of the cost of constructing an
6 electric generating unit on a date prior to 30 days after the
7 beginning of construction. For the purposes of section 1308
8 (relating to voluntary changes in rates), the latest estimate
9 submitted pursuant to a provision of this part other than
10 subsection (a) on a date prior to 30 days after the beginning of
11 construction shall be deemed to have been filed pursuant to
12 subsection (a).
13 (c) Construction audit.--From and after the beginning of
14 construction of an electric generating unit, the commission, or
15 its designee, and the Consumer Advocate, or his designee, shall
16 have reasonable access to the construction site and to any oral
17 or documentary evidence relevant to determining the necessity
18 and propriety of any construction cost. If a public utility
19 objects to any request by the commission or the Consumer
20 Advocate, or persons designated by the commission or the
21 Consumer Advocate, for access to the construction site or to any
22 oral or documentary evidence, the objection shall be decided in
23 the same manner as an on-the-record proceeding pursuant to
24 Chapter 3 (relating to public utility commission). The affected
25 public utility shall have the burden of proof in sustaining any
26 such objection.
27 (d) Definition.--As used in this section the term
28 "construction" includes any work performed on an electric
29 generating unit which requires the affected public utility to
30 incur an aggregate of at least $1,000,000 of expenses which, in
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1 accordance with generally accepted accounting principles, are
2 capital expenses and not operating or maintenance expenses.
3 Section 2. Section 1308 of Title 66 is amended by adding a
4 subsection to read:
5 § 1308. Voluntary changes in rates.
6 * * *
7 (f) Limitation on rate increases by certain public
8 utilities.--Whenever there is filed with the commission any
9 tariff stating a new rate based in whole or in part on the cost
10 of constructing an electric generating unit, the commission
11 shall compare the estimated construction cost filed in
12 accordance with section 514(a) (relating to construction cost of
13 electric generating units) with the actual construction cost
14 submitted by the utility in support of that tariff. If the
15 actual construction cost exceeds the estimated construction
16 cost, the rate determined by the commission under this section
17 shall not be based on any part of that excess unless the public
18 utility proves that part of the excess to have been necessary
19 and proper. In making its determination under this subsection,
20 the commission shall consider all relevant and material
21 evidence, including evidence obtained pursuant to section
22 514(c). For purposes of this subsection "construction" includes
23 any work performed on an electric generating unit which requires
24 the affected public utility to incur an aggregate of at least
25 $1,000,000 of expenses which, in accordance with generally
26 accepted accounting principles, are capital expenses and not
27 operating or maintenance expenses.
28 Section 3. This act shall apply to construction begun on or
29 after the effective date of this act, except that 66 Pa.C.S. §
30 514(c) and (d) (relating to construction cost of electric
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1 generating units) shall be applicable to construction begun and
2 completed prior to the effective date and to construction begun
3 but not completed prior to the effective date as well as to
4 construction begun on or after the effective date.
5 Section 4. This act shall take effect immediately.
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