PRIOR PRINTER'S NO. 1551 PRINTER'S NO. 2032
No. 1331 Session of 1999
INTRODUCED BY RAYMOND, APRIL 20, 1999
AS AMENDED ON THIRD CONSIDERATION, HOUSE OF REPRESENTATIVES, JUNE 14, 1999
AN ACT 1 Relating to notification of condemnation proceedings by a public <-- 2 utility. 3 AMENDING TITLE 66 (PUBLIC UTILITIES) OF THE PENNSYLVANIA <-- 4 CONSOLIDATED STATUTES, PROVIDING FOR SUPPLY CHOICE FOR 5 CUSTOMERS OF NATURAL GAS UTILITIES AND FOR RESTRUCTURING OF 6 THE NATURAL GAS UTILITY INDUSTRY AND FOR UTILITY INDUSTRY 7 RESTRUCTURING. 8 The General Assembly of the Commonwealth of Pennsylvania 9 hereby enacts as follows: 10 Section 1. Notification of condemnation. <-- 11 A public utility or pipeline company possessing the authority 12 to condemn real property must provide written notice of its 13 intent to condemn any real property to all municipalities in 14 which the real property is located at least 120 days prior to 15 initiating any action under the act of June 22, 1964 (Sp.Sess., 16 P.L.84, No.6) known as the Eminent Domain Code. 17 Section 2. Exception. 18 A public utility or pipeline company is not required to 19 provide the notice required under section 1 where it is acting 20 in response to an emergency.
1 Section 3. Effective date. 2 This act shall take effect in 60 days. 3 SECTION 1. SECTIONS 1307(F) AND (G), 1317 AND 1318 OF TITLE <-- 4 66 OF THE PENNSYLVANIA CONSOLIDATED STATUTES ARE AMENDED TO 5 READ: 6 § 1307. SLIDING SCALE OF RATES; ADJUSTMENTS. 7 * * * 8 (F) RECOVERY OF NATURAL GAS COSTS.-- 9 (1) NATURAL GAS [DISTRIBUTORS] DISTRIBUTION COMPANIES, 10 AS DEFINED IN SECTION 2202 (RELATING TO DEFINITIONS), WITH 11 GROSS INTRASTATE ANNUAL OPERATING REVENUES IN EXCESS OF 12 $40,000,000 MAY FILE TARIFFS REFLECTING ACTUAL AND PROJECTED 13 INCREASES OR DECREASES IN THEIR NATURAL GAS COSTS AND THE 14 TARIFFS SHALL HAVE AN EFFECTIVE DATE SIX MONTHS FROM THE DATE 15 OF FILING. THE COMMISSION SHALL PROMULGATE REGULATIONS 16 ESTABLISHING THE TIME AND MANNER OF SUCH FILING, BUT, EXCEPT 17 FOR ADJUSTMENTS PURSUANT TO A TARIFF MECHANISM AUTHORIZED IN 18 THIS TITLE, NO SUCH NATURAL GAS [UTILITY] DISTRIBUTION 19 COMPANY SHALL VOLUNTARILY FILE MORE THAN ONE SUCH TARIFF IN A 20 12-MONTH PERIOD: PROVIDED, THAT [NOTHING]: 21 (I) NOTHING CONTAINED HEREIN SHALL PROHIBIT ANY 22 PARTY FROM ADVISING THE COMMISSION THAT THERE HAS BEEN OR 23 THERE IS ANTICIPATED TO BE A SIGNIFICANT DIFFERENCE 24 BETWEEN THE NATURAL GAS COSTS TO THE [UTILITY] NATURAL 25 GAS DISTRIBUTION COMPANY AND THE COSTS REFLECTED IN THE 26 THEN EFFECTIVE TARIFF OR THE COMMISSION FROM ACTING UPON 27 SUCH ADVICE. 28 (II) A NATURAL GAS DISTRIBUTION COMPANY MAY ALSO 29 FILE A TARIFF TO ESTABLISH A MECHANISM BY WHICH SUCH 30 NATURAL GAS DISTRIBUTION COMPANY MAY FURTHER ADJUST ITS 19990H1331B2032 - 2 -
1 RATES FOR NATURAL GAS SALES ON A REGULAR, BUT NO MORE 2 FREQUENT THAN MONTHLY, BASIS TO REFLECT ACTUAL OR 3 PROJECTED CHANGES IN NATURAL GAS COSTS REFLECTED IN RATES 4 ESTABLISHED PURSUANT TO PARAGRAPH (2), SUBJECT TO ANNUAL 5 RECONCILIATION UNDER PARAGRAPH (5). IN THE EVENT THAT THE 6 NATURAL GAS DISTRIBUTION COMPANY ADJUSTS RATES MORE 7 FREQUENTLY THAN QUARTERLY, IT SHALL ALSO OFFER RETAIL GAS 8 CUSTOMERS A FIXED RATE OPTION WHICH RECOVERS NATURAL GAS 9 COSTS OVER A 12-MONTH PERIOD, SUBJECT TO ANNUAL 10 RECONCILIATION UNDER PARAGRAPH (5). THE COMMISSION SHALL, 11 WITHIN 60 DAYS OF THE EFFECTIVE DATE OF THIS 12 SUBPARAGRAPH, PROMULGATE RULES OR REGULATIONS GOVERNING 13 SUCH ADJUSTMENTS AND FIXED RATE OPTION, BUT THE 14 COMMISSION SHALL NOT PROHIBIT SUCH ADJUSTMENTS OR FIXED 15 RATE OPTION. 16 (2) THE COMMISSION SHALL CONDUCT AN INVESTIGATION AND 17 HOLD A HEARING OR HEARINGS, WITH NOTICE, TO [INVESTIGATE] 18 REVIEW THE TARIFFS AND CONSIDER THE PLANS FILED PURSUANT TO 19 SECTION 1317 (RELATING TO REGULATIONS OF NATURAL GAS COSTS). 20 WHERE THERE HAS BEEN AN INDICATION OF CONSUMER INTEREST, THE 21 HEARING SHALL BE HELD IN THE SERVICE TERRITORY OF THE NATURAL 22 GAS [DISTRIBUTOR] DISTRIBUTION COMPANY. PRIOR TO THE 23 EFFECTIVE DATE OF THE FILING, THE COMMISSION SHALL ISSUE AN 24 ORDER ESTABLISHING THE RATE TO BE CHARGED TO REFLECT SUCH 25 [INCREASES OR DECREASES] CHANGES IN NATURAL GAS COSTS. [RATES 26 ESTABLISHED UNDER THIS SUBSECTION DO NOT CONSTITUTE EITHER A 27 SLIDING SCALE OF RATES OR AN AUTOMATIC ADJUSTMENT SUBJECT TO 28 THE PROHIBITIONS IN SUBSECTIONS (A) AND (B).] THE COMMISSION 29 SHALL ANNUALLY REVIEW AND APPROVE PLANS FOR PURPOSES OF 30 RELIABILITY AND SUPPLY. SUCH RATES, HOWEVER, ARE SUBJECT TO 19990H1331B2032 - 3 -
1 THE [KINDS] TYPES OF AUDITS, REPORTS AND PROCEEDINGS REQUIRED 2 BY SUBSECTION (D). 3 (3) WITHIN 60 DAYS FOLLOWING THE END OF SUCH 12-MONTH 4 PERIOD AS THE COMMISSION SHALL DESIGNATE, EACH [PUBLIC 5 UTILITY] NATURAL GAS DISTRIBUTION COMPANY SUBJECT TO THIS 6 SUBSECTION SHALL FILE WITH THE COMMISSION A STATEMENT WHICH 7 SPECIFIES FOR SUCH PERIOD: 8 (I) THE TOTAL REVENUES RECEIVED PURSUANT TO THIS 9 SECTION. 10 (II) THE TOTAL [GAS EXPENSE] NATURAL GAS COSTS 11 INCURRED. 12 (III) THE DIFFERENCE BETWEEN THE AMOUNTS SPECIFIED 13 BY SUBPARAGRAPHS (I) AND (II). 14 (IV) [EVIDENCE EXPLAINING HOW ACTUAL] HOW ACTUAL 15 NATURAL GAS COSTS INCURRED DIFFER FROM THE NATURAL GAS 16 COSTS ALLOWED UNDER PARAGRAPH (2) AND WHY SUCH 17 DIFFERENCES OCCURRED. 18 (V) HOW THESE NATURAL GAS COSTS ARE CONSISTENT WITH 19 A LEAST COST PROCUREMENT POLICY AS REQUIRED BY SECTION 20 1318 (RELATING TO DETERMINATION OF JUST AND REASONABLE 21 [NATURAL] GAS COST RATES). 22 SUCH REPORT SHALL BE A MATTER OF PUBLIC RECORD AND COPIES 23 THEREOF SHALL BE MADE AVAILABLE BY THE [GAS DISTRIBUTOR] 24 NATURAL GAS DISTRIBUTION COMPANY TO ANY PERSON UPON REQUEST. 25 COPIES OF THE REPORTS SHALL BE FILED WITH THE OFFICE OF 26 CONSUMER ADVOCATE AND THE OFFICE OF SMALL BUSINESS ADVOCATE 27 AT THE SAME TIME AS THEY ARE FILED WITH THE COMMISSION. 28 (4) THE COMMISSION SHALL HOLD A PUBLIC HEARING ON THE 29 SUBSTANCE OF SUCH STATEMENT SUBMITTED BY A [UTILITY] NATURAL 30 GAS DISTRIBUTION COMPANY AS REQUIRED IN PARAGRAPH (3) AND ON 19990H1331B2032 - 4 -
1 ANY RELATED MATTERS. 2 (5) THE COMMISSION, AFTER HEARING, SHALL DETERMINE THE 3 PORTION OF THE [COMPANIES] COMPANY'S NATURAL GAS DISTRIBUTION 4 ACTUAL NATURAL GAS COSTS IN THE PREVIOUS 12-MONTH PERIOD 5 WHICH MEET THE STANDARDS SET OUT IN SECTION 1318. THE 6 COMMISSION SHALL, BY ORDER, DIRECT EACH [GAS UTILITY] NATURAL 7 GAS DISTRIBUTION COMPANY SUBJECT TO THIS SUBSECTION TO REFUND 8 TO ITS [PATRONS ANY] CUSTOMERS GAS REVENUES COLLECTED 9 PURSUANT TO PARAGRAPH (2) WHICH EXCEED THE AMOUNT OF ACTUAL 10 [GAS EXPENSES] NATURAL GAS COSTS INCURRED CONSISTENT WITH THE 11 STANDARDS IN SECTION 1318 AND TO RECOVER FROM ITS [PATRONS] 12 CUSTOMERS ANY AMOUNT BY WHICH THE ACTUAL [GAS EXPENSES,] 13 NATURAL GAS COSTS, WHICH HAVE BEEN INCURRED CONSISTENT WITH 14 THE STANDARDS IN SECTION 1318, EXCEED THE REVENUES COLLECTED 15 PURSUANT TO PARAGRAPH (2). ABSENT GOOD REASON TO THE 16 CONTRARY, THE COMMISSION SHALL ISSUE ITS ORDER WITHIN SIX 17 MONTHS FOLLOWING THE FILING OF THE STATEMENT DESCRIBED IN 18 PARAGRAPH (3). REFUNDS TO [PATRONS] CUSTOMERS SHALL BE MADE 19 WITH INTEREST, [WHICH SHALL BE THE AVERAGE RATE OF INTEREST 20 SPECIFIED FOR RESIDENTIAL MORTGAGE LENDING BY THE SECRETARY 21 OF BANKING IN ACCORDANCE WITH THE ACT OF JANUARY 30, 1974 22 (P.L.13, NO.6), REFERRED TO AS THE LOAN INTEREST AND 23 PROTECTION LAW,] AT THE LEGAL RATE OF INTEREST PLUS TWO 24 PERCENT, DURING THE PERIOD OR PERIODS FOR WHICH THE 25 COMMISSION ORDERS REFUNDS[:], AND RECOVERIES FROM CUSTOMERS 26 SHALL INCLUDE INTEREST AT THE LEGAL RATE OF INTEREST: 27 PROVIDED, THAT NOTHING CONTAINED HEREIN SHALL LIMIT THE 28 APPLICABILITY OF ANY DEFENSES, PRINCIPLES OR DOCTRINES WHICH 29 WOULD PROHIBIT THE COMMISSION'S INQUIRY INTO ANY MATTERS 30 THAT WERE DECIDED FINALLY IN THE COMMISSION'S ORDER ISSUED 19990H1331B2032 - 5 -
1 UNDER PARAGRAPH (2). 2 (6) THE COMMISSION SHALL REQUIRE THAT CUSTOMERS 3 TRANSFERRING FROM SALES TO TRANSPORTATION SERVICE BE SUBJECT 4 TO THE OVER OR UNDER COLLECTION ADJUSTMENT PROVIDED FOR IN 5 PARAGRAPH (5) AND SHALL REQUIRE FURTHER THAT CUSTOMERS 6 TRANSFERRING FROM TRANSPORTATION SERVICE TO SALES SERVICE NOT 7 BE SUBJECT TO THE OVER OR UNDER COLLECTION ADJUSTMENT FOR AN 8 APPROPRIATE PERIOD FOLLOWING EITHER SUCH TRANSFER. 9 (G) DEFINITION.--AS USED IN THIS SECTION, [THE TERM "NATURAL 10 GAS" INCLUDES NATURAL GAS, LIQUEFIED NATURAL GAS, SYNTHETIC 11 NATURAL GAS AND ANY NATURAL GAS SUBSTITUTES.] THE TERMS "NATURAL 12 GAS COSTS" AND "GAS COSTS" INCLUDE THE DIRECT COSTS PAID BY A 13 NATURAL GAS DISTRIBUTION COMPANY FOR THE PURCHASE AND THE 14 DELIVERY OF NATURAL GAS TO ITS SYSTEM IN ORDER TO SUPPLY ITS 15 CUSTOMERS. SUCH COSTS MAY INCLUDE COSTS PAID UNDER AGREEMENTS TO 16 PURCHASE NATURAL GAS FROM SELLERS; COSTS PAID FOR TRANSPORTING 17 NATURAL GAS TO ITS SYSTEM; COSTS PAID FOR NATURAL GAS STORAGE 18 SERVICE FROM OTHERS, INCLUDING THE COSTS OF INJECTING AND 19 WITHDRAWING NATURAL GAS FROM STORAGE; ALL CHARGES, FEES, TAXES 20 AND RATES PAID IN CONNECTION WITH SUCH PURCHASES, PIPELINE 21 GATHERING, STORAGE AND TRANSPORTATION; AND COSTS PAID FOR 22 EMPLOYING FUTURES, OPTIONS AND OTHER RISK MANAGEMENT TOOLS. 23 "NATURAL GAS" AND "GAS" INCLUDE NATURAL GAS, LIQUIFIED NATURAL 24 GAS, SYNTHETIC NATURAL GAS AND ANY NATURAL GAS SUBSTITUTES. 25 § 1317. REGULATION OF NATURAL GAS COSTS. 26 (A) GENERAL RULE.--IN EVERY RATE PROCEEDING INSTITUTED BY A 27 NATURAL GAS DISTRIBUTION UTILITY, PURSUANT TO SECTION 1307(F) 28 (RELATING TO SLIDING SCALE OF RATES; ADJUSTMENTS), EACH SUCH 29 UTILITY SHALL BE REQUIRED TO [PROVIDE] SUPPLY TO THE COMMISSION 30 SUCH INFORMATION, TO BE ESTABLISHED BY COMMISSION REGULATION 19990H1331B2032 - 6 -
1 WITHIN 120 DAYS OF THE PASSAGE OF THIS SECTION, THAT WILL PERMIT 2 THE COMMISSION TO MAKE SPECIFIC FINDINGS AS TO WHETHER THE 3 UTILITY IS PURSUING A LEAST COST FUEL PROCUREMENT POLICY, 4 CONSISTENT WITH THE UTILITY'S OBLIGATION TO PROVIDE SAFE, 5 ADEQUATE AND RELIABLE SERVICE TO ITS CUSTOMERS. SUCH INFORMATION 6 SHALL INCLUDE, BUT NEED NOT BE LIMITED TO, INFORMATION, DATA AND 7 STATEMENTS REGARDING: 8 (1) THE UTILITY'S PARTICIPATION IN RATE PROCEEDINGS 9 BEFORE THE FEDERAL ENERGY REGULATORY COMMISSION WHICH AFFECT 10 THE UTILITY'S GAS COSTS. 11 (2) THE UTILITY'S EFFORTS TO NEGOTIATE FAVORABLE 12 CONTRACTS WITH GAS SUPPLIERS AND TO RENEGOTIATE EXISTING 13 CONTRACTS WITH GAS SUPPLIERS OR TAKE LEGAL ACTIONS NECESSARY 14 TO RELIEVE THE UTILITY FROM EXISTING CONTRACT TERMS WHICH ARE 15 OR MAY BE ADVERSE TO THE INTERESTS OF THE UTILITY'S 16 RATEPAYERS. 17 (3) THE UTILITY'S EFFORTS TO SECURE LOWER COST GAS 18 SUPPLIES BOTH WITHIN AND OUTSIDE OF THE COMMONWEALTH, 19 INCLUDING THE USE OF TRANSPORTATION ARRANGEMENTS WITH 20 PIPELINES AND OTHER GAS DISTRIBUTION COMPANIES. 21 (4) THE SOURCES AND AMOUNTS OF ALL GAS SUPPLIES WHICH 22 HAVE BEEN WITHHELD OR HAVE BEEN CAUSED TO BE WITHHELD FROM 23 THE MARKET BY THE UTILITY AND THE REASONS WHY SUCH GAS IS NOT 24 TO BE UTILIZED. 25 (B) INTEGRATED GAS COMPANIES.--IN THE CASE OF A NATURAL GAS 26 DISTRIBUTION UTILITY WHICH PURCHASES ALL OR PART OF ITS GAS 27 SUPPLIES FROM AN AFFILIATED INTEREST, AS THAT TERM IS DEFINED IN 28 SECTION 2101 (RELATING TO DEFINITION OF AFFILIATED INTEREST), 29 SUCH UTILITY SHALL, IN ADDITION TO THE MATERIALS REQUIRED IN 30 SUBSECTION (A), BE REQUIRED TO PROVIDE TO THE COMMISSION SUCH 19990H1331B2032 - 7 -
1 INFORMATION, TO BE ESTABLISHED BY COMMISSION REGULATION WITHIN 2 120 DAYS OF THE PASSAGE OF THIS SECTION, THAT WILL PERMIT THE 3 COMMISSION TO MAKE SPECIFIC FINDINGS AS TO WHETHER ANY PURCHASES 4 OF GAS FROM AN AFFILIATED INTEREST ARE CONSISTENT WITH A LEAST 5 COST FUEL PROCUREMENT POLICY, CONSISTENT WITH THE UTILITY'S 6 OBLIGATION TO PROVIDE SAFE, ADEQUATE AND RELIABLE SERVICE TO ITS 7 CUSTOMERS. SUCH INFORMATION SHALL INCLUDE, BUT NEED NOT BE 8 LIMITED TO, STATEMENTS REGARDING: 9 (1) EFFORTS MADE BY THE UTILITY TO OBTAIN GAS SUPPLIES 10 FROM NONAFFILIATED INTERESTS. 11 (2) THE SPECIFIC REASONS WHY THE UTILITY HAS PURCHASED 12 GAS SUPPLIES FROM AN AFFILIATED INTEREST AND DEMONSTRATION 13 THAT SUCH PURCHASES ARE CONSISTENT WITH A LEAST COST FUEL 14 PROCUREMENT POLICY. 15 (3) THE SOURCES AND AMOUNTS OF ALL GAS SUPPLIES WHICH 16 HAVE BEEN WITHHELD FROM THE MARKET BY THE UTILITY OR ANY 17 AFFILIATED INTEREST AND THE REASONS WHY SUCH GAS IS NOT BEING 18 UTILIZED. 19 (C) RELIABILITY PLANS.--AS PART OF ITS FILING UNDER SECTION 20 1307(F) OR IF IT IS NOT REQUIRED TO MAKE SUCH A FILING ON AN 21 ANNUAL BASIS, A NATURAL GAS DISTRIBUTION COMPANY, AS DEFINED IN 22 SECTION 2202 (RELATING TO DEFINITIONS), SHALL FILE A PROPOSED 23 RELIABILITY PLAN WITH THE COMMISSION WHICH SHALL, AT A MINIMUM, 24 IDENTIFY THE FOLLOWING: 25 (1) THE PROJECTED PEAK DAY AND SEASONAL REQUIREMENTS OF 26 THE FIRM CUSTOMERS UTILIZING THE DISTRIBUTION SYSTEM OF THE 27 NATURAL GAS DISTRIBUTION COMPANY DURING THE 12-MONTH 28 PROJECTED PERIOD SPECIFIED IN SECTION 1307(F)(1). WHERE 29 OPERATIONALLY REQUIRED, THE DESIGN PEAK DAY REQUIREMENTS 30 SHALL BE SPECIFIED FOR DISCRETE SEGMENTS OF EACH NATURAL GAS 19990H1331B2032 - 8 -
1 DISTRIBUTION SYSTEM. 2 (2) THE TRANSPORTATION CAPACITY, STORAGE, PEAKING OR ON 3 SYSTEM PRODUCTION THAT ENSURES DELIVERABILITY OF THE NATURAL 4 GAS SUPPLIES NECESSARY TO MEET SUCH PROJECTED PERIOD PEAK DAY 5 AND SEASONAL REQUIREMENTS. 6 (D) SUPPLY PLANS.--AS PART OF ITS FILING UNDER SECTION 7 1307(F), A NATURAL GAS DISTRIBUTION COMPANY SHALL FILE A 8 PROPOSED PLAN WITH THE COMMISSION FOR ACQUISITION OR RECEIPT OF 9 NATURAL GAS SUPPLIES. 10 [(C)] (E) DEFINITION.--AS USED IN THIS SECTION, THE [TERM 11 "NATURAL GAS" INCLUDES NATURAL GAS, LIQUIFIED NATURAL GAS, 12 SYNTHETIC NATURAL GAS AND ANY NATURAL GAS SUBSTITUTES] TERMS 13 "NATURAL GAS COSTS," "GAS COSTS," "NATURAL GAS" AND "GAS" SHALL 14 HAVE THE SAME DEFINITIONS AS PROVIDED IN SECTION 1307(G). 15 § 1318. DETERMINATION OF JUST AND REASONABLE [NATURAL] GAS COST 16 RATES. 17 (A) GENERAL RULE.--IN ESTABLISHING JUST AND REASONABLE RATES 18 FOR THOSE NATURAL GAS DISTRIBUTION [UTILITIES] COMPANIES, AS 19 DEFINED IN SECTION 2202 (RELATING TO DEFINITIONS), WITH GROSS 20 INTRASTATE OPERATING REVENUES IN EXCESS OF $40,000,000 UNDER 21 SECTION 1307(F) (RELATING TO SLIDING SCALE OF RATES; 22 ADJUSTMENTS) OR 1308(D) (RELATING TO VOLUNTARY CHANGES IN RATES) 23 OR ANY OTHER RATE PROCEEDING, THE COMMISSION SHALL CONSIDER THE 24 MATERIALS PROVIDED BY THE UTILITIES PURSUANT TO SECTION 1317 25 (RELATING TO REGULATION OF NATURAL GAS COSTS). NO RATES FOR A 26 NATURAL GAS DISTRIBUTION UTILITY SHALL BE DEEMED JUST AND 27 REASONABLE UNLESS THE COMMISSION FINDS THAT THE UTILITY IS 28 PURSUING A LEAST COST FUEL PROCUREMENT POLICY, CONSISTENT WITH 29 THE UTILITY'S OBLIGATION TO PROVIDE SAFE, ADEQUATE AND RELIABLE 30 SERVICE TO ITS CUSTOMERS. IN MAKING SUCH A DETERMINATION, THE 19990H1331B2032 - 9 -
1 COMMISSION SHALL BE REQUIRED TO MAKE SPECIFIC FINDINGS WHICH 2 SHALL INCLUDE, BUT NEED NOT BE LIMITED TO, FINDINGS THAT: 3 (1) THE UTILITY HAS FULLY AND VIGOROUSLY REPRESENTED THE 4 INTERESTS OF ITS RATEPAYERS IN PROCEEDINGS BEFORE THE FEDERAL 5 ENERGY REGULATORY COMMISSION. 6 (2) THE UTILITY HAS TAKEN ALL PRUDENT STEPS NECESSARY TO 7 NEGOTIATE FAVORABLE GAS SUPPLY CONTRACTS AND TO RELIEVE THE 8 UTILITY FROM TERMS IN EXISTING CONTRACTS WITH ITS GAS 9 SUPPLIERS WHICH ARE OR MAY BE ADVERSE TO THE INTERESTS OF THE 10 UTILITY'S RATEPAYERS. 11 (3) THE UTILITY HAS TAKEN ALL PRUDENT STEPS NECESSARY TO 12 OBTAIN LOWER COST GAS SUPPLIES ON BOTH SHORT-TERM AND LONG- 13 TERM BASES BOTH WITHIN AND OUTSIDE THE COMMONWEALTH, 14 INCLUDING THE USE OF GAS TRANSPORTATION ARRANGEMENTS WITH 15 PIPELINES AND OTHER DISTRIBUTION COMPANIES. 16 (4) THE UTILITY HAS NOT WITHHELD FROM THE MARKET OR 17 CAUSED TO BE WITHHELD FROM THE MARKET ANY GAS SUPPLIES WHICH 18 SHOULD HAVE BEEN UTILIZED AS PART OF A LEAST COST FUEL 19 PROCUREMENT POLICY. 20 (B) LIMITATION ON GAS PURCHASED FROM AFFILIATES.--IN ANY 21 INSTANCE IN WHICH A NATURAL GAS DISTRIBUTION [UTILITY] COMPANY 22 PURCHASES ALL OR PART OF ITS GAS SUPPLIES FROM AN AFFILIATED 23 INTEREST, AS THAT TERM IS DEFINED IN SECTION 2101 (RELATING TO 24 DEFINITION OF AFFILIATED INTEREST), THE COMMISSION, IN ADDITION 25 TO THE DETERMINATIONS AND FINDINGS SET FORTH IN SUBSECTION (A), 26 SHALL BE REQUIRED TO MAKE SPECIFIC FINDINGS WITH REGARD TO THE 27 JUSTNESS AND REASONABLENESS OF ALL SUCH PURCHASES. SUCH FINDINGS 28 SHALL INCLUDE, BUT NOT BE LIMITED TO FINDINGS: 29 (1) THAT THE UTILITY HAS FULLY AND VIGOROUSLY ATTEMPTED 30 TO OBTAIN LESS COSTLY GAS SUPPLIES ON BOTH SHORT-TERM AND 19990H1331B2032 - 10 -
1 LONG-TERM BASES FROM NONAFFILIATED INTERESTS. 2 (2) THAT EACH CONTRACT FOR THE PURCHASE OF GAS FROM ITS 3 AFFILIATED INTEREST IS CONSISTENT WITH A LEAST COST FUEL 4 PROCUREMENT POLICY. 5 (3) THAT NEITHER THE UTILITY NOR ITS AFFILIATED INTEREST 6 HAS WITHHELD FROM THE MARKET ANY GAS SUPPLIES WHICH SHOULD 7 HAVE BEEN UTILIZED AS PART OF A LEAST COST FUEL PROCUREMENT 8 POLICY. 9 (C) SHUT-IN GAS; SPECIAL RULE.--IN DETERMINING WHETHER A GAS 10 UTILITY HAS PURCHASED THE LEAST COSTLY NATURAL GAS AVAILABLE, 11 THE COMMISSION SHALL CONSIDER AS AVAILABLE TO THE UTILITY ANY 12 GAS SUPPLIES THAT REASONABLY COULD HAVE BEEN BROUGHT TO MARKET 13 DURING THE RELEVANT PERIOD BUT WHICH WERE VOLUNTARILY WITHHELD 14 FROM THE MARKET BY THE UTILITY OR AN AFFILIATED INTEREST OF THE 15 UTILITY. 16 (D) OTHER REGULATORY APPROVALS.--THE FACT THAT A CONTRACT OR 17 RATE HAS BEEN APPROVED BY A FEDERAL REGULATORY AGENCY FOR 18 INTERSTATE RATEMAKING PURPOSES SHALL NOT, IN AND OF ITSELF, BE 19 ADEQUATE TO SATISFY THE UTILITY'S BURDEN OF PROOF THAT GAS 20 PRICES AND VOLUMES ASSOCIATED WITH SUCH CONTRACT OR RATE ARE 21 JUST AND REASONABLE FOR PURPOSES OF THIS SECTION. 22 (E) REPORTS.--EACH NATURAL GAS DISTRIBUTION UTILITY WITH 23 GROSS INTRASTATE ANNUAL OPERATING REVENUES IN EXCESS OF 24 $40,000,000 SHALL FILE WITH THE COMMISSION [AND], THE OFFICE OF 25 CONSUMER ADVOCATE AND THE OFFICE OF SMALL BUSINESS ADVOCATE, IN 26 ACCORDANCE WITH REGULATIONS TO BE PRESCRIBED BY THE COMMISSION, 27 QUARTERLY REPORTS SETTING FORTH THE ACTUAL GAS COSTS INCURRED BY 28 THE UTILITY ON A MONTHLY BASIS. ACTUAL GAS COSTS SHALL BE 29 REVIEWED FOR THEIR ACCURACY BY THE BUREAU OF AUDITS AT LEAST 30 ANNUALLY AND THE RESULTS OF THAT REVIEW SHALL BE SUBMITTED TO 19990H1331B2032 - 11 -
1 THE COMMISSION. 2 (F) DEFINITION.--AS USED IN THIS SECTION, THE [TERM INCLUDES 3 NATURAL GAS, LIQUIFIED NATURAL GAS, SYNTHETIC NATURAL GAS AND 4 ANY NATURAL GAS SUBSTITUTES.] TERMS "NATURAL GAS" "NATURAL GAS 5 COSTS," "GAS COSTS," AND "GAS" SHALL HAVE THE SAME DEFINITIONS 6 AS PROVIDED IN SECTION 1307(G). 7 SECTION 2. TITLE 66 IS AMENDED BY ADDING A CHAPTER TO READ: 8 CHAPTER 20 9 UTILITY INDUSTRY RESTRUCTURING 10 SEC. 11 2001. APPLICABILITY. 12 2002. FINDINGS AND PURPOSES. 13 2003. REQUIREMENTS. 14 2004. REQUIREMENTS RELATED TO WORK FORCE REDUCTION. 15 2005. DISPLACED EMPLOYEE PROGRAM. 16 2006. TRANSFERS OF OWNERSHIP. 17 2007. TRANSFERS TO CERTAIN SUBSIDIARIES. 18 2008. EXISTING SALES AGREEMENTS. 19 § 2001. APPLICABILITY. 20 IN ADDITION TO ANY OTHER SPECIFIC REQUIREMENTS CONTAINED IN 21 THIS TITLE, THE PROVISIONS OF THIS CHAPTER SHALL APPLY TO THE 22 RESTRUCTURING OR DEREGULATION OF ANY PUBLIC UTILITY INDUSTRY. 23 § 2002. FINDINGS AND PURPOSES. 24 (1) THE RELIABILITY AND SAFETY OF THE PUBLIC UTILITY 25 INDUSTRIES SUBJECT TO THIS TITLE HAVE DEPENDED ON A WORK 26 FORCE OF SKILLED AND DEDICATED EMPLOYEES EQUIPPED WITH 27 TECHNICAL TRAINING AND EXPERIENCE. 28 (2) THE INTEGRITY AND RELIABILITY OF THEIR SYSTEMS ALSO 29 HAVE DEPENDED ON EACH INDUSTRY'S COMMITMENT TO INVEST IN 30 REGULAR INSPECTION AND MAINTENANCE, TO ASSURE THAT THEY CAN 19990H1331B2032 - 12 -
1 WITHSTAND THE DEMANDS OF HEAVY SERVICE REQUIREMENTS AND 2 EMERGENCY SITUATIONS. 3 (3) IT IS IN THE COMMONWEALTH'S INTEREST TO PROTECT THE 4 INTERESTS OF PUBLIC UTILITY EMPLOYEES WHO HAVE DEDICATED 5 THEMSELVES TO ASSURING RELIABLE SERVICE TO THE CITIZENS OF 6 THIS COMMONWEALTH AND WHO OTHERWISE MIGHT BE ECONOMICALLY 7 DISPLACED IN A RESTRUCTURED INDUSTRY. 8 § 2003. REQUIREMENTS. 9 THE GENERAL ASSEMBLY FURTHER FINDS THAT IT IS NECESSARY TO 10 ASSURE THAT EMPLOYEES OPERATING IN A RESTRUCTURED OR DEREGULATED 11 PUBLIC UTILITY INDUSTRY HAVE THE REQUISITE SKILLS, KNOWLEDGE AND 12 COMPETENCE TO PROVIDE SAFE, ADEQUATE AND RELIABLE SERVICE AND, 13 THEREFORE, ALL PUBLIC UTILITIES AND ALL OTHER PERSONS PROVIDING 14 SERVICES TO CONSUMERS USING THE FACILITIES OF A PUBLIC UTILITY 15 SHALL BE REQUIRED TO DEMONSTRATE THE COMPETENCE OF THEIR 16 EMPLOYEES TO WORK IN THE PUBLIC UTILITY INDUSTRY. THE KNOWLEDGE, 17 SKILLS AND COMPETENCE LEVELS TO BE DEMONSTRATED SHALL BE 18 CONSISTENT WITH THOSE GENERALLY REQUIRED OF OR BY COMPARABLE 19 PUBLIC UTILITIES IN THIS COMMONWEALTH WITH RESPECT TO THEIR 20 EMPLOYEES. ADEQUATE DEMONSTRATION OF REQUISITE KNOWLEDGE, SKILLS 21 AND COMPETENCE SHALL INCLUDE SUCH FACTORS AS COMPLETION BY THE 22 EMPLOYEE OF AN ACCREDITED OR OTHERWISE RECOGNIZED APPRENTICESHIP 23 PROGRAM FOR THE PARTICULAR CRAFT, TRADE OR SKILL, OR SPECIFIED 24 YEARS OF EMPLOYMENT WITH A PUBLIC UTILITY OR SIMILAR BUSINESS 25 PERFORMING THE PARTICULAR WORK FUNCTION. TO IMPLEMENT THIS 26 REQUIREMENT, THE COMMISSION, IN DETERMINING THAT A PERSON OR 27 PUBLIC UTILITY MEETS THE STANDARDS REQUIRED BY THIS CHAPTER, 28 SHALL REQUIRE THE PERSON OR PUBLIC UTILITY TO DEMONSTRATE THAT 29 THE PERSON OR PUBLIC UTILITY IS LICENSED TO DO BUSINESS IN THIS 30 COMMONWEALTH AND THAT THE EMPLOYEES OF THE PERSON OR PUBLIC 19990H1331B2032 - 13 -
1 UTILITY THAT WILL BE INSTALLING, OPERATING AND MAINTAINING 2 FACILITIES AND SERVICES WITHIN THIS COMMONWEALTH, OR ANY OTHER 3 ENTITY WHICH THE PERSON OR PUBLIC UTILITY HAS CONTRACTED TO 4 PERFORM THOSE FUNCTIONS WITHIN THIS COMMONWEALTH, HAVE THE 5 REQUISITE KNOWLEDGE, SKILLS AND COMPETENCE TO PERFORM THOSE 6 FUNCTIONS IN A SAFE AND RESPONSIBLE MANNER IN ORDER TO PROVIDE 7 SAFE, ADEQUATE AND RELIABLE SERVICE IN ACCORDANCE WITH THE 8 CRITERIA STATED HEREIN. 9 § 2004. REQUIREMENTS RELATED TO WORK FORCE REDUCTION. 10 (A) WORK FORCE REDUCTION PLAN.--THE GENERAL ASSEMBLY FINDS 11 BASED ON EXPERIENCE IN INDUSTRIES THAT HAVE UNDERGONE 12 DEREGULATION, RESTRUCTURING AND TRANSITION, THAT THE 13 INTRODUCTION OF COMPETITION INTO THIS COMMONWEALTH'S REGULATED 14 INDUSTRIES MAY RESULT IN WORK FORCE REDUCTIONS BY PUBLIC 15 UTILITIES WHICH MAY ADVERSELY AFFECT PERSONS WHO HAVE BEEN 16 EMPLOYED IN THIS COMMONWEALTH'S REGULATED INDUSTRIES IN 17 FUNCTIONS IMPORTANT TO THE PUBLIC CONVENIENCE AND NECESSITY. THE 18 GENERAL ASSEMBLY FURTHER FINDS THAT THE IMPACTS ON EMPLOYEES AND 19 THEIR COMMUNITIES OF ANY NECESSARY REDUCTIONS IN THE INDUSTRY'S 20 WORK FORCE DIRECTLY CAUSED BY THE RESTRUCTURING OR DEREGULATION 21 OF AN INDUSTRY SUBJECT TO THIS TITLE SHALL BE MITIGATED TO THE 22 EXTENT PRACTICABLE THROUGH SUCH MEANS AS OFFERS OF VOLUNTARY 23 SEVERANCE, RETRAINING, EARLY RETIREMENT, OUTPLACEMENT, 24 CONTINUATION OF MEDICAL BENEFITS AND RELATED BENEFITS. 25 THEREFORE, BEFORE ANY SUCH REDUCTION IN THE WORK FORCE, A PUBLIC 26 UTILITY SHALL PRESENT TO ITS EMPLOYEES OR THEIR REPRESENTATIVES 27 A WORK FORCE REDUCTION PLAN OUTLINING THE MEANS BY WHICH THE 28 PUBLIC UTILITY INTENDS TO REASONABLY MITIGATE THE IMPACT OF SUCH 29 WORK FORCE REDUCTION ON ITS EMPLOYEES. 30 (B) EMPLOYEE TERMINATION.--BEGINNING MAY 1, 1999, IF A 19990H1331B2032 - 14 -
1 PUBLIC UTILITY LAYS OFF OR TERMINATES ANY OF ITS EMPLOYEES, 2 EXCEPT FOR JUST CAUSE, THE PUBLIC UTILITY SHALL PROVIDE THE 3 COMMISSION WITH SUFFICIENT INFORMATION TO SHOW THAT WITH THE 4 REDUCTION OF EMPLOYEES THE PUBLIC UTILITY WILL STILL BE ABLE TO 5 ENSURE THE SAFETY, ADEQUACY AND RELIABILITY OF SERVICE TO ALL 6 CUSTOMERS AND PROVIDE AT LEAST 60 DAYS' WRITTEN NOTICE OF SUCH 7 LAYOFF OR TERMINATION TO THE PUBLIC UTILITY'S EMPLOYEES OR THE 8 EMPLOYEES' AUTHORIZED BARGAINING REPRESENTATIVE. 9 § 2005. DISPLACED EMPLOYEE PROGRAM. 10 THE DEPARTMENT OF LABOR AND INDUSTRY SHALL ESTABLISH AND 11 IMPLEMENT A PROGRAM TO ASSIST THE EMPLOYEES OF A PUBLIC UTILITY 12 WHO ARE DISPLACED BY RESTRUCTURING OR DEREGULATION. THE PROGRAM 13 SHALL BE DESIGNED TO ASSIST EMPLOYEES IN OBTAINING EMPLOYMENT 14 AND SHALL CONSIST OF UTILIZING THE FEDERAL FUNDS AVAILABLE FOR 15 THE PURPOSE OF RETRAINING AND OUTPLACEMENT SERVICES FOR SUCH 16 EMPLOYEES. 17 § 2006. TRANSFERS OF OWNERSHIP. 18 IN THE EVENT OF A SALE, PURCHASE, OR ANY OTHER TRANSFER OF 19 OWNERSHIP OF A PUBLIC UTILITY, OR OF ONE OR MORE PENNSYLVANIA 20 DIVISIONS OR BUSINESS UNITS OF A PUBLIC UTILITY, THE EXISTING 21 PUBLIC UTILITY'S CONTRACTS AND/OR AGREEMENTS WITH THE ACQUIRING 22 PERSON SHALL REQUIRE THAT THE ACQUIRING PERSON SHALL HIRE A 23 SUFFICIENT NUMBER OF NONSUPERVISORY EMPLOYEES TO OPERATE AND 24 MAINTAIN THE FACILITIES AND SERVICES OF THE PUBLIC UTILITY BY 25 INITIALLY MAKING OFFERS OF EMPLOYMENT TO THE NONSUPERVISORY WORK 26 FORCE OF THE PUBLIC UTILITY, OR THE DIVISION OR BUSINESS UNIT OF 27 THE PUBLIC UTILITY BEING TRANSFERRED, AT NO LESS THAN THE WAGE 28 RATES AND SUBSTANTIALLY EQUIVALENT FRINGE BENEFITS AND TERMS AND 29 CONDITIONS OF EMPLOYMENT THAT ARE IN EFFECT AT THE TIME OF 30 TRANSFER OF OWNERSHIP OF SAID DIVISION OR BUSINESS UNIT AND SAID 19990H1331B2032 - 15 -
1 WAGE RATES AND SUBSTANTIALLY EQUIVALENT FRINGE BENEFITS AND 2 TERMS OF AND CONDITIONS OF EMPLOYMENT SHALL CONTINUE FOR AT 3 LEAST 30 MONTHS FROM THE TIME OF SAID TRANSFER OF OWNERSHIP 4 UNLESS THE PUBLIC UTILITY, THE ACQUIRING PERSON AND THE AFFECTED 5 EMPLOYEES MUTUALLY AGREE TO DIFFERENT TERMS AND CONDITIONS OF 6 EMPLOYMENT WITHIN THAT 30-MONTH PERIOD. THE PUBLIC UTILITY SHALL 7 OFFER A TRANSITION PLAN TO THOSE EMPLOYEES WHO ARE NOT OFFERED 8 JOBS BY THE ACQUIRING PERSON BECAUSE THAT PERSON HAS A NEED FOR 9 FEWER WORKERS. IF THERE IS LITIGATION CONCERNING THE SALE OR 10 OTHER TRANSFER OF OWNERSHIP OF THE PUBLIC UTILITY, OR THE 11 DIVISION OR BUSINESS UNIT OF THE PUBLIC UTILITY, THE 30-MONTH 12 PERIOD WILL BEGIN ON THE DATE THE ACQUIRING PERSON TAKES CONTROL 13 OR MANAGEMENT OF THE PUBLIC UTILITY OR THE DIVISION OR BUSINESS 14 UNIT OF THE PUBLIC UTILITY. 15 § 2007. TRANSFERS TO CERTAIN SUBSIDIARIES. 16 IF A PUBLIC UTILITY TRANSFERS OWNERSHIP OF ONE OR MORE 17 PENNSYLVANIA DIVISIONS OR BUSINESS UNITS TO A MAJORITY-OWNED 18 SUBSIDIARY OF THE PUBLIC UTILITY OR TO ANY AFFILIATED INTEREST 19 OF THE PUBLIC UTILITY AS DEFINED IN SECTION 2101 (RELATING TO 20 DEFINITION OF AFFILIATED INTEREST), THAT SUBSIDIARY OR 21 AFFILIATED INTEREST SHALL CONTINUE TO EMPLOY THE PUBLIC 22 UTILITY'S EMPLOYEES WHO WERE EMPLOYED BY THE PUBLIC UTILITY AT 23 SUCH DIVISION OR BUSINESS UNIT AT THE TIME OF THE TRANSFER UNDER 24 THE SAME TERMS AND CONDITIONS OF EMPLOYMENT AS THOSE EMPLOYEES 25 ENJOYED AT THE TIME OF THE TRANSFER. IF OWNERSHIP OF THE 26 SUBSIDIARY OR AFFILIATED INTEREST IS SUBSEQUENTLY SOLD OR 27 TRANSFERRED TO A THIRD PARTY, THESE PROVISIONS SHALL CONTINUE TO 28 APPLY. 29 § 2008. EXISTING SALES AGREEMENTS. 30 THE PROVISIONS OF SECTIONS 2006 (RELATING TO TRANSFERS OF 19990H1331B2032 - 16 -
1 OWNERSHIP) AND 2007 (RELATING TO TRANSFERS TO CERTAIN 2 SUBSIDIARIES) SHALL NOT APPLY TO THE TRANSFER OF ANY DIVISION OR 3 BUSINESS UNIT OF A PUBLIC UTILITY WHICH WAS THE SUBJECT OF AN 4 EXECUTED SALES AGREEMENT ENTERED INTO BEFORE JANUARY 1, 1999. 5 SECTION 3. SUBPART D OF PART I OF TITLE 66 IS AMENDED BY 6 ADDING A CHAPTER TO READ: 7 CHAPTER 22 8 NATURAL GAS COMPETITION 9 SEC. 10 2201. SHORT TITLE OF CHAPTER. 11 2202. DEFINITIONS. 12 2203. STANDARDS FOR RESTRUCTURING OF NATURAL GAS UTILITY 13 INDUSTRY. 14 2204. IMPLEMENTATION. 15 2205. DUTIES OF NATURAL GAS DISTRIBUTION COMPANIES. 16 2206. CONSUMER PROTECTIONS AND CUSTOMER SERVICE. 17 2207. OBLIGATION TO SERVE. 18 2208. REQUIREMENTS FOR NATURAL GAS SUPPLIERS. 19 2209. MARKET POWER REMEDIATION. 20 2210. APPROVAL OF PROPOSED MERGERS, CONSOLIDATIONS, 21 ACQUISITIONS OR DISPOSITIONS. 22 2211. RATE CAPS. 23 § 2201. SHORT TITLE OF CHAPTER. 24 THIS CHAPTER SHALL BE KNOWN AND MAY BE CITED AS THE NATURAL 25 GAS CHOICE AND COMPETITION ACT. 26 § 2202. DEFINITIONS. 27 THE FOLLOWING WORDS AND PHRASES WHEN USED IN THIS CHAPTER 28 SHALL HAVE THE MEANINGS GIVEN TO THEM IN THIS SECTION UNLESS THE 29 CONTEXT CLEARLY INDICATES OTHERWISE: 30 "CONSUMER PROTECTION." THE STANDARDS, PRACTICES AND SERVICE 19990H1331B2032 - 17 -
1 PROTECTIONS FOR RETAIL GAS CUSTOMERS, INCLUDING THOSE PROVIDED 2 FOR IN 52 PA. CODE CH. 56 (RELATING TO STANDARDS AND BILLING 3 PRACTICES FOR RESIDENTIAL UTILITY SERVICE), AS WELL AS 4 APPLICABLE FEDERAL AND STATE DEBT/CREDIT COLLECTION STATUTES AND 5 ANY REGULATIONS OR ORDERS OF THE COMMISSION THAT PROVIDE SUCH 6 PROTECTIONS, AS MAY BE MODIFIED BY THE COMMISSION FROM TIME TO 7 TIME. 8 "ENTITY." A PERSON OR CORPORATION AS DEFINED IN SECTION 102 9 (RELATING TO DEFINITIONS). 10 "NATURAL GAS DISTRIBUTION COMPANY." A PUBLIC UTILITY THAT 11 PROVIDES NATURAL GAS DISTRIBUTION SERVICES AND WHICH MAY PROVIDE 12 NATURAL GAS SUPPLY SERVICES AND OTHER SERVICES. FOR PURPOSES OF 13 THIS CHAPTER, THIS TERM DOES NOT INCLUDE: 14 (1) ANY PUBLIC UTILITY SUBJECT TO THE JURISDICTION OF 15 THE COMMISSION WHICH HAS ANNUAL GAS OPERATING REVENUES OF 16 LESS THAN $6,000,000 PER YEAR, EXCEPT WHERE THE PUBLIC 17 UTILITY VOLUNTARILY PETITIONS THE COMMISSION TO BE INCLUDED 18 WITHIN THIS DEFINITION OR WHERE THE PUBLIC UTILITY SEEKS TO 19 PROVIDE NATURAL GAS SUPPLY SERVICES TO RETAIL GAS CUSTOMERS 20 OUTSIDE ITS SERVICE TERRITORY; OR 21 (2) ANY NATURAL GAS PUBLIC UTILITY SUBJECT TO THE 22 JURISDICTION OF THE COMMISSION THAT IS NOT INTERCONNECTED TO 23 AN INTERSTATE GAS PIPELINE BY MEANS OF A DIRECT CONNECTION OR 24 AN INDIRECT CONNECTION THROUGH THE DISTRIBUTION SYSTEM OF 25 ANOTHER NATURAL GAS PUBLIC UTILITY OR THROUGH A NATURAL GAS 26 GATHERING SYSTEM. 27 "NATURAL GAS DISTRIBUTION SERVICE." THE DELIVERY OF NATURAL 28 GAS TO RETAIL GAS CUSTOMERS UTILIZING THE JURISDICTIONAL 29 FACILITIES OF THE NATURAL GAS DISTRIBUTION COMPANY. 30 "NATURAL GAS SUPPLIER." AN ENTITY OTHER THAN A NATURAL GAS 19990H1331B2032 - 18 -
1 DISTRIBUTION COMPANY, BUT INCLUDING NATURAL GAS DISTRIBUTION 2 COMPANY MARKETING AFFILIATES, WHICH PROVIDES NATURAL GAS SUPPLY 3 SERVICES TO RETAIL GAS CUSTOMERS UTILIZING THE JURISDICTIONAL 4 FACILITIES OF A NATURAL GAS DISTRIBUTION COMPANY. THE TERM 5 INCLUDES A NATURAL GAS DISTRIBUTION COMPANY THAT PROVIDES 6 NATURAL GAS SUPPLY SERVICES OUTSIDE ITS CERTIFICATED SERVICE 7 TERRITORIES. THE TERM INCLUDES A MUNICIPAL CORPORATION, ITS 8 AFFILIATES OR ANY JOINT VENTURE, TO THE EXTENT THAT IT CHOOSES 9 TO PROVIDE NATURAL GAS SUPPLY SERVICES TO RETAIL CUSTOMERS 10 LOCATED OUTSIDE OF ITS CORPORATE OR MUNICIPAL LIMITS, AS 11 APPLICABLE, OTHER THAN: 12 (I) AS PROVIDED PRIOR TO THE EFFECTIVE DATE OF THIS 13 CHAPTER, PURSUANT TO A CERTIFICATE OF PUBLIC CONVENIENCE 14 IF REQUIRED UNDER THIS TITLE; 15 (II) TOTAL NATURAL GAS SUPPLY SERVICES IN DE MINIMIS 16 AMOUNTS; 17 (III) NATURAL GAS SUPPLY SERVICES REQUESTED BY, OR 18 PROVIDED WITH THE CONSENT OF, THE PUBLIC UTILITY IN WHOSE 19 CERTIFICATED TERRITORY THE SERVICES ARE PROVIDED; OR 20 (IV) NATURAL GAS SUPPLY SERVICES PROVIDED TO THE 21 MUNICIPAL CORPORATION ITSELF OR ITS TENANTS ON LAND IT 22 OWNS OR LEASES, OR IS SUBJECT TO AN AGREEMENT OF SALE OR 23 PENDING CONDEMNATION, AS OF SEPTEMBER 1, 1999, TO THE 24 EXTENT PERMITTED BY APPLICABLE LAW INDEPENDENT OF THIS 25 CHAPTER. 26 THE TERM EXCLUDES AN ENTITY TO THE EXTENT THAT IT PROVIDES FREE 27 GAS TO END-USERS UNDER THE TERMS OF AN OIL OR GAS LEASE. 28 NOTWITHSTANDING ANY OTHER PROVISION OF THIS TITLE, A NATURAL GAS 29 SUPPLIER THAT IS NOT A NATURAL GAS DISTRIBUTION COMPANY IS NOT A 30 PUBLIC UTILITY AS DEFINED IN SECTION 102 (RELATING TO 19990H1331B2032 - 19 -
1 DEFINITIONS) TO THE EXTENT THAT THE NATURAL GAS SUPPLIER IS 2 UTILIZING THE JURISDICTIONAL DISTRIBUTION FACILITIES OF A 3 NATURAL GAS DISTRIBUTION COMPANY OR IS PROVIDING OTHER SERVICES 4 AUTHORIZED BY THE COMMISSION. 5 "NATURAL GAS SUPPLY SERVICES." 6 (1) THE TERM INCLUDES: 7 (I) THE SALE OR ARRANGEMENT OF THE SALE OF NATURAL 8 GAS TO RETAIL GAS CUSTOMERS; AND 9 (II) SERVICES THAT MAY BE UNBUNDLED BY THE 10 COMMISSION UNDER SECTION 2203(3) (RELATING TO STANDARDS 11 FOR RESTRUCTURING OF NATURAL GAS UTILITY INDUSTRY). 12 (2) THE TERM DOES NOT INCLUDE DISTRIBUTION SERVICE. 13 "RELIABILITY." THE TERM COMPRISES ADEQUACY AND SECURITY. THE 14 TERM "ADEQUACY" MEANS THE PROVISION OF SUFFICIENT VOLUMES AND 15 DELIVERABILITY OF NATURAL GAS SO AS TO SUPPLY THE REQUIREMENTS 16 OF RETAIL GAS CUSTOMERS, TAKING INTO ACCOUNT PEAK AND SEASONAL 17 DEMANDS, AS WELL AS ISOLATED MARKET AREAS AND SYSTEM OPERATION 18 CONTINGENCIES. THE TERM "SECURITY" MEANS DESIGNING, MAINTAINING 19 AND OPERATING A SYSTEM SO THAT IT CAN SAFELY HANDLE EXTREME 20 CONDITIONS, AS WELL AS EMERGENCIES. 21 "RETAIL GAS CUSTOMER." A DIRECT PURCHASER OF NATURAL GAS 22 SUPPLY SERVICES OR NATURAL GAS DISTRIBUTION SERVICES, OTHER THAN 23 A NATURAL GAS SUPPLIER. THE TERM EXCLUDES AN OCCUPANT OF A 24 BUILDING OR FACILITY WHERE THE OWNER/OPERATORS MANAGE THE 25 INTERNAL DISTRIBUTION SYSTEM SERVING SUCH BUILDING OR FACILITY 26 AND SUPPLY NATURAL GAS AND OTHER RELATED SERVICES TO OCCUPANTS 27 OF THE BUILDING OR FACILITY; WHERE SUCH OWNER/OPERATORS ARE 28 DIRECT PURCHASERS OF NATURAL GAS SUPPLY SERVICE; AND WHERE THE 29 OCCUPANTS ARE NOT DIRECT PURCHASERS. 30 "UNIVERSAL SERVICE AND ENERGY CONSERVATION." POLICIES, 19990H1331B2032 - 20 -
1 PRACTICES AND SERVICES THAT HELP RESIDENTIAL LOW-INCOME RETAIL 2 GAS CUSTOMERS AND OTHER RESIDENTIAL RETAIL GAS CUSTOMERS 3 EXPERIENCING TEMPORARY EMERGENCIES, AS DEFINED BY THE 4 COMMISSION, TO MAINTAIN NATURAL GAS SUPPLY AND DISTRIBUTION 5 SERVICES. THE TERM INCLUDES RETAIL GAS CUSTOMER ASSISTANCE 6 PROGRAMS, TERMINATION OF SERVICE PROTECTIONS AND CONSUMER 7 PROTECTION POLICIES AND SERVICES THAT HELP RESIDENTIAL LOW- 8 INCOME CUSTOMERS AND OTHER RESIDENTIAL CUSTOMERS EXPERIENCING 9 TEMPORARY EMERGENCIES TO REDUCE OR MANAGE ENERGY CONSUMPTION IN 10 A COST-EFFECTIVE MANNER, SUCH AS THE LOW-INCOME USAGE REDUCTION 11 PROGRAMS AND CONSUMER EDUCATION. 12 § 2203. STANDARDS FOR RESTRUCTURING OF NATURAL GAS UTILITY 13 INDUSTRY. 14 THE FOLLOWING INTERDEPENDENT STANDARDS SHALL GOVERN THE 15 COMMISSION'S ACTIONS IN ADOPTING RULES, ORDERS OR POLICIES AND 16 IN REVIEWING, ASSESSING AND APPROVING EACH NATURAL GAS 17 DISTRIBUTION COMPANY'S RESTRUCTURING FILINGS AND OVERSEEING THE 18 TRANSITION PROCESS AND REGULATION OF THE RESTRUCTURED NATURAL 19 GAS UTILITY INDUSTRY: 20 (1) THE COMMISSION SHALL ADOPT AND ENFORCE STANDARDS AS 21 NECESSARY TO ENSURE CONTINUATION OF THE SAFETY AND 22 RELIABILITY OF THE NATURAL GAS SUPPLY AND DISTRIBUTION 23 SERVICE TO ALL RETAIL GAS CUSTOMERS. IN ADOPTING THE 24 STANDARDS, THE COMMISSION SHALL CONSIDER THE ABSENCE OF ANY 25 APPLICABLE INDUSTRY STANDARDS AND PRACTICES OR ADOPT 26 STANDARDS IN CONFORMITY WITH INDUSTRY STANDARDS AND PRACTICES 27 MEETING THE STANDARDS OF THIS CHAPTER. THE APPLICATION OF 28 SUCH STANDARDS SHALL BE IN A MANNER THAT INCORPORATES THE 29 OPERATING REQUIREMENTS OF THE DIFFERENT NATURAL GAS 30 DISTRIBUTION COMPANIES. 19990H1331B2032 - 21 -
1 (2) CONSISTENT WITH SECTION 2204 (RELATING TO 2 IMPLEMENTATION), THE COMMISSION SHALL ALLOW RETAIL GAS 3 CUSTOMERS TO CHOOSE AMONG NATURAL GAS SUPPLIERS AND NATURAL 4 GAS DISTRIBUTION COMPANIES TO THE EXTENT THAT THEY OFFER SUCH 5 NATURAL GAS SUPPLY SERVICES. RETAIL GAS CUSTOMERS SHALL BE 6 ABLE TO CHOOSE FROM THESE SUPPLIERS A VARIETY OF PRODUCTS, 7 INCLUDING, BUT NOT LIMITED TO, DIFFERENT SUPPLY AND PRICING 8 OPTIONS, AND SERVICES THAT EVOLVE AS THE COMPETITIVE 9 MARKETPLACE MATURES. NEITHER ANY NATURAL GAS SUPPLIER NOR ANY 10 NATURAL GAS DISTRIBUTION COMPANY SHALL OFFER INTERRUPTIBLE 11 GAS SERVICE TO ANY ESSENTIAL HUMAN NEEDS RETAIL GAS CUSTOMER 12 LACKING INSTALLED AND OPERABLE ALTERNATIVE FUEL CAPABILITY OR 13 TO ANY RESIDENTIAL RETAIL GAS CUSTOMER. 14 (3) THE COMMISSION SHALL REQUIRE NATURAL GAS 15 DISTRIBUTION COMPANIES TO UNBUNDLE NATURAL GAS SUPPLY 16 SERVICES SUCH THAT SEPARATE CHARGES FOR THE SERVICES CAN BE 17 SET FORTH IN TARIFFS AND ON RETAIL GAS CUSTOMERS' BILLS. IN 18 ITS RESTRUCTURING FILING, THE NATURAL GAS DISTRIBUTION 19 COMPANY SHALL ESTABLISH SYSTEM RELIABILITY STANDARDS AND 20 CAPACITY CONTRACT MITIGATION PARAMETERS AND ADDRESS THE 21 UNBUNDLING OF COMMODITY, CAPACITY, STORAGE, BALANCING AND 22 AGGREGATOR SERVICES. THE COMMISSION MAY ADDRESS THE 23 UNBUNDLING OF OTHER SERVICES ONLY THROUGH A RULEMAKING. IN 24 CONDUCTING THE RULEMAKING, THE COMMISSION SHALL CONSIDER THE 25 IMPACT OF SUCH UNBUNDLING ON THE LABOR FORCE, THE CREATION OF 26 STRANDED COSTS, SAFETY, RELIABILITY, CONSUMER PROTECTIONS, 27 UNIVERSAL SERVICE AND THE POTENTIAL FOR UNBUNDLING TO OFFER 28 SAVINGS, NEW PRODUCTS AND ADDITIONAL CHOICES OR SERVICES TO 29 RETAIL GAS CUSTOMERS. THE COMMISSION'S DECISIONS SHALL ASSURE 30 THAT STANDARDS AND PROCEDURES FOR SAFETY AND RELIABILITY, 19990H1331B2032 - 22 -
1 CONSUMER PROTECTIONS AND UNIVERSAL SERVICE ARE MAINTAINED AT 2 LEVELS CONSISTENT WITH THIS CHAPTER. 3 (4) CONSISTENT WITH THE PROVISIONS OF SECTION 2204, THE 4 COMMISSION SHALL REQUIRE THAT A NATURAL GAS DISTRIBUTION 5 COMPANY THAT OWNS OR OPERATES JURISDICTIONAL DISTRIBUTION 6 FACILITIES SHALL PROVIDE DISTRIBUTION SERVICE TO ALL RETAIL 7 GAS CUSTOMERS IN ITS SERVICE TERRITORY AND TO ALL NATURAL GAS 8 SUPPLIERS, AFFILIATED OR NONAFFILIATED, ON NONDISCRIMINATORY 9 RATES, TERMS OF ACCESS AND OTHER CONDITIONS. 10 (5) THE COMMISSION SHALL REQUIRE THAT RESTRUCTURING OF 11 THE NATURAL GAS UTILITY INDUSTRY BE IMPLEMENTED IN A MANNER 12 THAT DOES NOT UNREASONABLY DISCRIMINATE AGAINST ONE CUSTOMER 13 CLASS FOR THE BENEFIT OF ANOTHER. 14 (6) AFTER NOTICE AND HEARINGS, THE COMMISSION SHALL 15 ESTABLISH FOR EACH NATURAL GAS DISTRIBUTION COMPANY AN 16 APPROPRIATE NONBYPASSABLE, COMPETITIVELY NEUTRAL COST- 17 RECOVERY MECHANISM WHICH IS DESIGNED TO RECOVER FULLY THE 18 NATURAL GAS DISTRIBUTION COMPANY'S UNIVERSAL SERVICE AND 19 ENERGY CONSERVATION COSTS OVER THE LIFE OF THESE PROGRAMS. 20 EXCEPT AS PROVIDED IN PARAGRAPH (10), POLICIES, ACTIVITIES 21 AND SERVICES UNDER THIS PARAGRAPH SHALL BE FUNDED AND SPENT 22 IN EACH NATURAL GAS DISTRIBUTION COMPANY'S SERVICE TERRITORY. 23 NOTHING IN THIS CHAPTER SHALL BE CONSTRUED TO PROHIBIT PUBLIC 24 FUNDING OR VOLUNTARY FUNDING BY THIRD PARTIES OF A NATURAL 25 GAS DISTRIBUTION COMPANY'S UNIVERSAL SERVICE AND ENERGY 26 CONSERVATION PROGRAMS. 27 (7) THE COMMISSION SHALL, AT A MINIMUM, CONTINUE THE 28 LEVEL AND NATURE OF THE CONSUMERS PROTECTIONS, POLICIES AND 29 SERVICES WITHIN ITS JURISDICTION THAT ARE IN EXISTENCE AS OF 30 THE EFFECTIVE DATE OF THIS CHAPTER TO ASSIST LOW-INCOME 19990H1331B2032 - 23 -
1 RETAIL GAS CUSTOMERS TO AFFORD NATURAL GAS SERVICES. 2 (8) THE COMMISSION SHALL ENSURE THAT UNIVERSAL SERVICE 3 AND ENERGY CONSERVATION POLICIES, ACTIVITIES AND SERVICES ARE 4 APPROPRIATELY FUNDED AND AVAILABLE IN EACH NATURAL GAS 5 DISTRIBUTION SERVICE TERRITORY. THE COMMISSION SHALL 6 ENCOURAGE THE USE OF COMMUNITY-BASED ORGANIZATIONS THAT HAVE 7 THE NECESSARY TECHNICAL AND ADMINISTRATIVE EXPERIENCE TO BE 8 THE DIRECT PROVIDERS OF SERVICES OR PROGRAMS WHICH REDUCE 9 ENERGY CONSUMPTION OR OTHERWISE ASSIST LOW-INCOME RETAIL GAS 10 CUSTOMERS TO AFFORD NATURAL GAS SERVICE. PROGRAMS UNDER THIS 11 PARAGRAPH SHALL BE SUBJECT TO THE ADMINISTRATIVE OVERSIGHT OF 12 THE COMMISSION, WHICH SHALL ENSURE THAT THE PROGRAMS ARE 13 OPERATED IN A COST-EFFECTIVE MANNER. 14 (9) EACH NATURAL GAS DISTRIBUTION COMPANY SHALL SET 15 FORTH IN ITS RESTRUCTURING FILING AN INITIAL PROPOSAL TO MEET 16 ITS UNIVERSAL SERVICE AND ENERGY CONSERVATION OBLIGATIONS. 17 (10) CONSISTENT WITH PARAGRAPH (7), THE COMMISSION SHALL 18 CONVENE A TASK FORCE TO REVIEW UNIVERSAL SERVICE PROGRAMS AND 19 THEIR FUNDING. THE TASK FORCE SHALL ISSUE A REPORT TO THE 20 COMMISSION BY DECEMBER 31, 1999, AND ANNUALLY THEREAFTER. 21 RECOMMENDATIONS REGARDING THE USE OF GENERAL STATE REVENUE 22 SHALL BE CONCURRENTLY FORWARDED TO THE GENERAL ASSEMBLY. 23 (11) THE COMMISSION SHALL CONTINUE TO REGULATE RATES FOR 24 NATURAL GAS DISTRIBUTION SERVICES FOR NEW AND EXISTING RETAIL 25 GAS CUSTOMERS IN ACCORDANCE WITH CHAPTER 13 (RELATING TO 26 RATES AND RATE MAKING) AND THIS CHAPTER. 27 (12) THE COMMISSION SHALL MAKE ITS DETERMINATIONS 28 PURSUANT TO THIS CHAPTER AND SHALL ADOPT SUCH ORDERS OR 29 REGULATIONS AS NECESSARY AND APPROPRIATE TO ENSURE THAT 30 NATURAL GAS SUPPLIERS MEET THEIR SUPPLY AND RELIABILITY 19990H1331B2032 - 24 -
1 OBLIGATIONS, INCLUDING, BUT NOT LIMITED TO, ESTABLISHING 2 PENALTIES FOR FAILURE TO DELIVER NATURAL GAS AND REVOKING 3 LICENSES. ANY AFFECTED ENTITY MAY AT ANY TIME PETITION THE 4 COMMISSION TO AMEND OR RESCIND ANY SUCH ORDER OR REGULATION 5 ISSUED OR PROMULGATED UNDER THIS CHAPTER. 6 (13) EACH NATURAL GAS DISTRIBUTION COMPANY SHALL SET 7 FORTH IN ITS RESTRUCTURING FILING AN INITIAL PROPOSAL TO MEET 8 ITS EMPLOYEE TRANSITION OBLIGATIONS PRECIPITATED BY THIS 9 CHAPTER. 10 (14) THE NATURAL GAS DISTRIBUTION COMPANY MAY CONTINUE 11 TO PROVIDE NATURAL GAS SERVICE TO ITS CUSTOMERS UNDER ALL 12 TARIFF RATE SCHEDULES AND RIDERS INCORPORATED INTO ITS 13 TARIFF, AND POLICIES OR PROGRAMS, EXISTING ON THE EFFECTIVE 14 DATE OF THIS CHAPTER. 15 (15) BEGINNING MAY 1, 1999, AND CONTINUING FOR A 36- 16 MONTH PERIOD THEREAFTER, IF A NATURAL GAS DISTRIBUTION 17 COMPANY LAYS OFF OR TERMINATES ANY OF ITS EMPLOYEES, EXCEPT 18 FOR JUST CAUSE, THE NATURAL GAS DISTRIBUTION COMPANY SHALL: 19 (I) PROVIDE THE COMMISSION WITH SUFFICIENT 20 INFORMATION TO SHOW THAT WITH THE REDUCTION OF EMPLOYEES 21 THE COMPANY WILL STILL BE ABLE TO ENSURE THE SAFETY AND 22 RELIABILITY OF NATURAL GAS DISTRIBUTION SERVICE TO ALL 23 RETAIL GAS CUSTOMERS, AS PROVIDED FOR BY THE COMMISSION 24 UNDER PARAGRAPH (1). 25 (II) PROVIDE AT LEAST 60 DAYS' WRITTEN NOTICE OF 26 SUCH LAYOFF OR TERMINATION TO THE COMPANY'S EMPLOYEES' 27 AUTHORIZED BARGAINING REPRESENTATIVE. 28 § 2204. IMPLEMENTATION. 29 (A) COMMENCEMENT OF CUSTOMER CHOICE.--BEGINNING ON NOVEMBER 30 1, 1999, UNLESS THE COMMISSION FOR GOOD CAUSE SHOWN EXTENDS THIS 19990H1331B2032 - 25 -
1 PERIOD BY NO MORE THAN EIGHT MONTHS, CONSISTENT WITH THIS 2 CHAPTER, ALL RETAIL GAS CUSTOMERS OF NATURAL GAS DISTRIBUTION 3 COMPANIES SHALL HAVE THE OPPORTUNITY TO PURCHASE NATURAL GAS 4 SUPPLY SERVICES FROM A NATURAL GAS SUPPLIER OR THEIR NATURAL GAS 5 DISTRIBUTION COMPANY TO THE EXTENT IT OFFERS SUCH SERVICES. THE 6 CHOICE OF NATURAL GAS SUPPLIERS SHALL REST WITH THE RETAIL GAS 7 CUSTOMER. THE COMMISSION SHALL ADOPT ORDERS, RULES, REGULATIONS 8 AND POLICIES AS SHALL BE NECESSARY AND APPROPRIATE TO IMPLEMENT 9 FULLY THIS CHAPTER WITHIN THE TIME FRAMES SPECIFIED IN THIS 10 CHAPTER, PROVIDED THAT THE COMMISSION MAY, IN THE CONTEXT OF 11 EACH NATURAL GAS DISTRIBUTION COMPANY'S RESTRUCTURING 12 PROCEEDING, ESTABLISH THE TIME FRAMES FOR IMPLEMENTATION OF 13 SPECIFIC COMPONENTS OF EACH NATURAL GAS DISTRIBUTION COMPANY'S 14 RESTRUCTURING PLAN. 15 (B) RESTRUCTURING FILINGS.--ALL NATURAL GAS DISTRIBUTION 16 COMPANIES IN THIS COMMONWEALTH SHALL FILE WITH THE COMMISSION, 17 PURSUANT TO A SCHEDULE TO BE DETERMINED BY THE COMMISSION IN 18 CONSULTATION WITH THE NATURAL GAS DISTRIBUTION COMPANIES, A 19 RESTRUCTURING FILING CONSISTENT WITH THIS CHAPTER AND WITH ANY 20 ORDERS, RULES OR REGULATIONS ADOPTED BY THE COMMISSION. 21 (C) COMMISSION REVIEW.-- 22 (1) THE COMMISSION SHALL REVIEW THE RESTRUCTURING FILING 23 OF EACH NATURAL GAS DISTRIBUTION COMPANY AND SHALL, AFTER 24 OPEN EVIDENTIARY HEARINGS WITH PROPER NOTICE AND OPPORTUNITY 25 FOR ALL PARTIES TO CROSS-EXAMINE WITNESSES AND BRIEF ISSUES, 26 ISSUE AN ORDER ACCEPTING, MODIFYING OR REJECTING SUCH FILING 27 AT THE EARLIEST DATE POSSIBLE, BUT NO LATER THAN NINE MONTHS 28 FROM THE FILING DATE. 29 (2) IN ISSUING THE RESTRUCTURING ORDER, THE COMMISSION 30 MAY CONSIDER THE RESULTS OF ANY COLLABORATIVE PROCESS 19990H1331B2032 - 26 -
1 PREVIOUSLY ENGAGED IN DURING OR PRIOR TO THE RESTRUCTURING 2 PROCEEDING. 3 (3) IF THE COMMISSION MODIFIES OR REJECTS A 4 RESTRUCTURING FILING, IT SHALL STATE THE SPECIFIC REASONS FOR 5 MODIFICATION OR REJECTION AND DIRECT THE NATURAL GAS 6 DISTRIBUTION COMPANY TO ADDRESS SUCH OBJECTIONS WITH ANOTHER 7 FILING WITHIN 30 DAYS OF THE ENTRY DATE OF THE COMMISSION 8 ORDER MODIFYING OR REJECTING THE PRIOR FILING. 9 (4) THE COMMISSION SHALL REVIEW THE ALTERNATIVE FILING, 10 SOLICIT COMMENTS AND REPLY COMMENTS FROM INTERESTED PARTIES 11 AND ISSUE A FINAL ORDER WITHIN 45 DAYS OF THE REVISED FILING. 12 (D) RELEASE, ASSIGNMENT OR TRANSFER OF CAPACITY.-- 13 (1) A NATURAL GAS DISTRIBUTION COMPANY HOLDING CONTRACTS 14 FOR FIRM STORAGE OR TRANSPORTATION CAPACITY, INCLUDING GAS 15 SUPPLY CONTRACTS WITH PENNSYLVANIA PRODUCERS, ON THE 16 EFFECTIVE DATE OF THIS CHAPTER MAY, AT ITS OPTION, RELEASE, 17 ASSIGN OR OTHERWISE TRANSFER SUCH CAPACITY, OR PENNSYLVANIA 18 SUPPLY, IN WHOLE OR PART, ASSOCIATED WITH THOSE CONTRACTS ON 19 A NONDISCRIMINATORY BASIS TO LICENSED NATURAL GAS SUPPLIERS 20 OR LARGE COMMERCIAL OR INDUSTRIAL CUSTOMERS ON ITS SYSTEM. 21 (2) CONTRACTS WHICH BY THEIR TERMS MUST BE RENEWED 22 WITHIN 150 DAYS AFTER THE EFFECTIVE DATE OF THIS CHAPTER OR 23 CONTRACTS FOR WHICH THE LAST DAY FOR NOTICE OF RENEWAL OR 24 NONRENEWAL PURSUANT TO THE NOTICE PROVISION OF THE CONTRACT 25 HAS OCCURRED OR IS WITHIN 150 DAYS AFTER THE EFFECTIVE DATE 26 OF THIS CHAPTER AND WHICH ARE RENEWED PURSUANT TO SUCH NOTICE 27 REQUIREMENTS SHALL ALSO BE SUBJECT TO THE PROVISIONS OF THIS 28 SUBSECTION. 29 (3) SUCH RELEASE, ASSIGNMENT OR TRANSFER SHALL BE AT THE 30 APPLICABLE CONTRACT RATE FOR SUCH CAPACITY, OR PENNSYLVANIA 19990H1331B2032 - 27 -
1 SUPPLY, AND SHALL BE SUBJECT TO APPLICABLE CONTRACTUAL 2 ARRANGEMENTS AND TARIFFS. THE AMOUNT SO RELEASED, ASSIGNED OR 3 TRANSFERRED SHALL BE SUFFICIENT TO SERVE THE LEVEL OF THE 4 CUSTOMERS' REQUIREMENTS FOR WHICH THE NATURAL GAS 5 DISTRIBUTION COMPANY HAS PROCURED SUCH CAPACITY, DETERMINED 6 IN ACCORDANCE WITH THE NATURAL GAS DISTRIBUTION COMPANY'S 7 TARIFF OR PROCEDURES APPROVED IN ITS RESTRUCTURING 8 PROCEEDINGS. 9 (4) THE LICENSED NATURAL GAS SUPPLIER SHALL ACCEPT SUCH 10 RELEASE, ASSIGNMENT OR TRANSFER OF THAT CAPACITY, OR 11 PENNSYLVANIA SUPPLY, AND ENTER INTO ALL APPLICABLE CONTRACTS 12 OR AGREEMENTS, AS A CONDITION OF SERVING RETAIL GAS CUSTOMERS 13 ON THE NATURAL GAS DISTRIBUTION COMPANY'S SYSTEM. 14 (5) ON OR AFTER JULY 1, 2002, THE COMMISSION SHALL HAVE 15 THE AUTHORITY TO PREVENT SUCH ASSIGNMENTS, RELEASES OR 16 TRANSFERS UNDER EITHER OF THE FOLLOWING CIRCUMSTANCES: 17 (I) THE NATURAL GAS DISTRIBUTION COMPANY, ALONE OR 18 TOGETHER WITH ONE OR MORE NATURAL GAS SUPPLIERS, 19 VOLUNTARILY PROPOSES AN ALTERNATIVE TO SUCH ASSIGNMENTS, 20 RELEASES OR TRANSFERS AND THE COMMISSION FINDS SUCH 21 ALTERNATIVE TO BE IN THE PUBLIC INTEREST; OR 22 (II) UPON THE PETITION OF THE LICENSED NATURAL GAS 23 SUPPLIER WHO DESIRES TO USE ALTERNATE INTERSTATE STORAGE 24 OR TRANSPORTATION CAPACITY TO SERVE ITS CUSTOMERS ON THE 25 NATURAL GAS DISTRIBUTION COMPANY'S SYSTEM, THE COMMISSION 26 MAKES THE FOLLOWING FINDINGS AND ISSUES A FINAL ORDER AS 27 TO WHICH ALL APPEALS HAVE BEEN EXHAUSTED IN WHICH: 28 (A) THE COMMISSION FINDS THAT THE ALTERNATE 29 CAPACITY WHICH THE NATURAL GAS SUPPLIER SEEKS TO 30 UTILIZE MEETS THE OPERATIONAL NEEDS AND RELIABILITY 19990H1331B2032 - 28 -
1 STANDARDS OF THE NATURAL GAS DISTRIBUTION COMPANY. 2 (B) THE COMMISSION CONFIRMS THAT THE NATURAL GAS 3 DISTRIBUTION COMPANY'S SPECIFIC TRANSPORTATION AND 4 STORAGE CAPACITY CONTRACTS TO BE DISPLACED ARE NO 5 LONGER NEEDED TO SERVE FIRM CUSTOMERS OF THE NATURAL 6 GAS DISTRIBUTION COMPANY. 7 (C) THE COMMISSION AUTHORIZES THE NATURAL GAS 8 DISTRIBUTION COMPANY TO FOLLOW A SPECIFIC, WRITTEN 9 MITIGATION PLAN APPROVED BY THE COMMISSION OR, IF 10 SUCH A PLAN IS NOT APPROVED OR APPLICABLE, TO POST 11 THE DISPLACED CAPACITY FOR RELEASE IN ACCORDANCE WITH 12 THE RULES AND REGULATIONS OF THE FEDERAL ENERGY 13 REGULATORY COMMISSION AND APPLICABLE REQUIREMENTS OF 14 INTERSTATE PIPELINES. 15 (D) THE COMMISSION AUTHORIZES THE NATURAL GAS 16 DISTRIBUTION COMPANY TO RECOVER THE DIFFERENCE 17 BETWEEN THE AMOUNT THE NATURAL GAS DISTRIBUTION 18 COMPANY IS REQUIRED TO PAY UNDER THE APPLICABLE 19 CONTRACT TERMS FOR THE CAPACITY RELEASED, ASSIGNED OR 20 TRANSFERRED PURSUANT TO SUBPARAGRAPH (C) AND THE 21 AMOUNT THE NATURAL GAS DISTRIBUTION COMPANY RECEIVES 22 FROM AN ENTITY, IF ANY, THAT ACQUIRES SUCH CAPACITY. 23 UNDER NO CIRCUMSTANCES, HOWEVER, SHALL SUCH RECOVERY 24 RESULT IN SHIFTING OF COSTS BETWEEN CUSTOMER CLASSES 25 OR IN ANY INCREASE IN RATES TO CUSTOMERS WHO CONTINUE 26 TO PURCHASE NATURAL GAS SUPPLIES FROM THE NATURAL GAS 27 DISTRIBUTION COMPANY ACTING IN ITS SUPPLIER OF LAST 28 RESORT FUNCTION. 29 (6) PRIOR TO MAKING THE FILING PROVIDED FOR IN PARAGRAPH 30 (5), THE NATURAL GAS SUPPLIER SHALL MEET WITH THE NATURAL GAS 19990H1331B2032 - 29 -
1 DISTRIBUTION COMPANY TO DISCUSS THE NATURAL GAS SUPPLIER'S 2 PROPOSED ALTERNATIVES TO THE EXISTING GAS SUPPLY OR CAPACITY 3 CONTRACTS OR TO THEIR MANDATORY ASSIGNMENT. 4 (7) THOSE NATURAL GAS DISTRIBUTION COMPANIES HAVING GAS 5 SUPPLY CONTRACTS WITH PENNSYLVANIA PRODUCERS MAY ADDRESS THE 6 ISSUE OF POST-JULY 1, 2002, ASSIGNMENT OF SUCH CONTRACTS IN 7 THEIR RESTRUCTURING PROCEEDING OR THEREAFTER. 8 (E) NEW AND RENEWED CAPACITY.-- 9 (1) SUBJECT TO THE SERVICE OBLIGATIONS IMPOSED BY THIS 10 TITLE, AND TO THE EXTENT SUCH CAPACITY IS NOT NEEDED TO MEET 11 THE NATURAL GAS DISTRIBUTION COMPANY'S LEAST COST FUEL 12 PROCUREMENT AND OTHER APPLICABLE STANDARDS PURSUANT TO THIS 13 TITLE, PRIOR TO ENTERING INTO NEW OR RENEWED CONTRACTS FOR 14 FIRM STORAGE OR TRANSPORTATION CAPACITY NOT SUBJECT TO 15 SUBSECTION (D)(1), (2), (3) OR (4) EACH NATURAL GAS 16 DISTRIBUTION COMPANY SHALL OFFER ON A NONDISCRIMINATORY BASIS 17 TO EACH NATURAL GAS SUPPLIER LICENSED TO DO BUSINESS ON ITS 18 SYSTEM, AND TO LARGE VOLUME INDUSTRIAL OR COMMERCIAL 19 CUSTOMERS OF THE NATURAL GAS DISTRIBUTION COMPANY BEING 20 SERVED BY SUCH CONTRACTS, THE OPPORTUNITY TO RENEW SUCH 21 CONTRACTS, PURSUANT TO THE RULES AND REGULATIONS OF THE 22 FEDERAL ENERGY REGULATORY COMMISSION, OR TO ENTER INTO OTHER 23 CONTRACTS FOR CAPACITY. 24 (2) THE CAPACITY SHALL MEET THE RELIABILITY CRITERIA OF 25 THE NATURAL GAS DISTRIBUTION COMPANY AND, IN THE CASE OF 26 LARGE VOLUME INDUSTRIAL AND COMMERCIAL CUSTOMERS BEING SERVED 27 BY SUCH CONTRACTS, SHALL MEET THEIR CURRENT REQUIREMENTS. 28 (3) EACH NATURAL GAS DISTRIBUTION COMPANY SHALL UTILIZE 29 THE COLLABORATIVE PROCESS ESTABLISHED PURSUANT TO SUBSECTION 30 (F) TO ADDRESS ITS CAPACITY REQUIREMENTS. 19990H1331B2032 - 30 -
1 (4) ABSENT THE NATURAL GAS SUPPLIER OR LARGE VOLUME 2 INDUSTRIAL OR COMMERCIAL CUSTOMER TAKING OR PROVIDING SUCH 3 CAPACITY, THE NATURAL GAS DISTRIBUTION COMPANY SHALL FILE 4 WITH AND OBTAIN APPROVAL FROM THE COMMISSION FOR SUCH 5 CONTRACTS NECESSARY TO ENSURE SUFFICIENT CAPACITY TO MEET 6 CURRENT AND PROJECTED CUSTOMER REQUIREMENTS CONSIDERING THE 7 COMMITMENTS OF NATURAL GAS SUPPLIERS. 8 (5) PRIOR TO BEING DISPLACED BY A NATURAL GAS SUPPLIER'S 9 ALTERNATE INTERSTATE STORAGE OR TRANSPORTATION CAPACITY, 10 CONTRACTS RENEWED OR ENTERED INTO BY THE NATURAL GAS 11 DISTRIBUTION COMPANY PURSUANT TO THIS SUBSECTION SHALL BE 12 SUBJECT TO THE PROCESS SET FORTH IN SUBSECTION (D). 13 (F) WORKING GROUP AND COLLABORATIVE PROCESS.--IN ITS 14 RESTRUCTURING PROCEEDING, A NATURAL GAS DISTRIBUTION COMPANY 15 SHALL SET FORTH A PROCESS TO ESTABLISH A WORKING GROUP OF 16 LICENSED NATURAL GAS SUPPLIERS HAVING CUSTOMERS ON THE NATURAL 17 GAS DISTRIBUTION COMPANY'S SYSTEM AND REPRESENTATIVES OF THE 18 RESIDENTIAL, COMMERCIAL AND INDUSTRIAL CUSTOMER CLASSES TO: 19 (1) MEET ON A SCHEDULED BASIS. 20 (2) SEEK RESOLUTION OF OPERATIONAL AND CAPACITY ISSUES 21 RELATED TO CUSTOMER CHOICE. 22 THE FINAL DETERMINATION OF OPERATIONAL AND RELIABILITY ISSUES 23 RESIDES WITH THE NATURAL GAS DISTRIBUTION COMPANY. IN ADDITION, 24 THE NATURAL GAS DISTRIBUTION COMPANY SHALL INCLUDE IN ITS 25 RESTRUCTURING FILING A COLLABORATIVE PROCESS TO ADDRESS BROADER 26 ISSUES RELATING TO UNBUNDLING, CUSTOMER CHOICE AND DEREGULATION. 27 (G) INVESTIGATION AND REPORT TO GENERAL ASSEMBLY.--FIVE 28 YEARS AFTER THE EFFECTIVE DATE OF THIS CHAPTER, THE COMMISSION 29 SHALL INITIATE AN INVESTIGATION OR OTHER APPROPRIATE PROCEEDING, 30 IN WHICH ALL INTERESTED PARTIES ARE INVITED TO PARTICIPATE, TO 19990H1331B2032 - 31 -
1 DETERMINE WHETHER EFFECTIVE COMPETITION FOR NATURAL GAS SUPPLY 2 SERVICES EXISTS ON THE NATURAL GAS DISTRIBUTION COMPANIES' 3 SYSTEMS IN THIS COMMONWEALTH. THE COMMISSION SHALL REPORT ITS 4 FINDINGS TO THE GENERAL ASSEMBLY. SHOULD THE COMMISSION CONCLUDE 5 THAT EFFECTIVE COMPETITION DOES NOT EXIST, THE COMMISSION SHALL 6 RECONVENE THE STAKEHOLDERS IN THE NATURAL GAS INDUSTRY IN THIS 7 COMMONWEALTH TO EXPLORE AVENUES, INCLUDING LEGISLATIVE, FOR 8 ENCOURAGING INCREASED COMPETITION IN THIS COMMONWEALTH. 9 (H) DISPLACED EMPLOYEE PROGRAM.--THE DEPARTMENT OF LABOR AND 10 INDUSTRY SHALL ESTABLISH AND IMPLEMENT A PROGRAM TO ASSIST THE 11 NATURAL GAS DISTRIBUTION COMPANY EMPLOYEES WHO ARE DISPLACED BY 12 THE TRANSITION TO RETAIL COMPETITION PRECIPITATED BY THIS 13 CHAPTER. THE PROGRAM SHALL BE DESIGNED TO ASSIST EMPLOYEES IN 14 OBTAINING EMPLOYMENT AND SHALL CONSIST OF UTILIZING THE FEDERAL 15 FUNDS AVAILABLE FOR THE PURPOSE OF RETRAINING AND OUTPLACEMENT 16 SERVICES FOR SUCH EMPLOYEES. 17 § 2205. DUTIES OF NATURAL GAS DISTRIBUTION COMPANIES. 18 (A) INTEGRITY OF DISTRIBUTION SYSTEM.-- 19 (1) EACH NATURAL GAS DISTRIBUTION COMPANY SHALL MAINTAIN 20 THE INTEGRITY OF ITS DISTRIBUTION SYSTEM AT LEAST IN 21 CONFORMITY WITH THE STANDARDS ESTABLISHED BY THE FEDERAL 22 DEPARTMENT OF TRANSPORTATION AND SUCH OTHER STANDARDS 23 PRACTICED BY THE INDUSTRY IN A MANNER SUFFICIENT TO PROVIDE 24 SAFE AND RELIABLE SERVICE TO ALL RETAIL GAS CUSTOMERS 25 CONNECTED TO ITS SYSTEM CONSISTENT WITH THIS TITLE AND THE 26 COMMISSION'S ORDERS OR REGULATIONS. 27 (2) IN PERFORMING SUCH DUTIES, THE NATURAL GAS 28 DISTRIBUTION COMPANY SHALL IMPLEMENT PROCEDURES TO REQUIRE 29 ALL NATURAL GAS SUPPLIERS TO SUPPLY NATURAL GAS TO THE 30 NATURAL GAS DISTRIBUTION COMPANY AT LOCATIONS, VOLUMES, 19990H1331B2032 - 32 -
1 QUALITIES AND PRESSURES THAT ARE ADEQUATE TO MEET THE NATURAL 2 GAS SUPPLIER'S SUPPLY AND RELIABILITY OBLIGATIONS TO ITS 3 RETAIL GAS CUSTOMERS AND THE NATURAL GAS DISTRIBUTION 4 COMPANY'S SUPPLY AND RELIABILITY OBLIGATIONS TO ITS RETAIL 5 GAS CUSTOMERS. THE PROCEDURES SHALL INCLUDE, BUT NOT BE 6 LIMITED TO: 7 (I) A COMMUNICATION PROTOCOL WITH NATURAL GAS 8 SUPPLIERS. 9 (II) AN ABILITY TO ISSUE SYSTEM MAINTENANCE ORDERS 10 TO CONTROL THE FLOW OF GAS INTO THE DISTRIBUTION SYSTEM. 11 (III) THE RIGHT TO ISSUE AND ENFORCE PENALTIES 12 PURSUANT TO COMMISSION DIRECTION, PROVIDED, HOWEVER, THAT 13 THE COMMISSION MAY APPROVE ADDITIONAL PROCEDURES OF LIKE 14 NATURE BY ORDER OR REGULATION TO PRESERVE RELIABILITY. 15 (B) INSTALLATION AND IMPROVEMENT OF FACILITIES.-- 16 (1) THE NATURAL GAS DISTRIBUTION COMPANY SHALL NOT HAVE 17 AN OBLIGATION TO INSTALL NONSTANDARD FACILITIES, EITHER AS TO 18 TYPE OR LOCATION, FOR THE PURPOSE OF RECEIVING NATURAL GAS 19 FROM THE NATURAL GAS SUPPLIER UNLESS THE NATURAL GAS SUPPLIER 20 OR ITS RETAIL GAS CUSTOMER PAYS THE FULL COST OF THESE 21 FACILITIES. 22 (2) NOTHING IN THIS CHAPTER SHALL PREVENT THE NATURAL 23 GAS DISTRIBUTION COMPANY FROM MAINTAINING AND UPGRADING ITS 24 SYSTEM TO MEET RETAIL GAS CUSTOMER REQUIREMENTS CONSISTENT 25 WITH THE REQUIREMENT OF SECTION 1501 (RELATING TO CHARACTER 26 OF SERVICE AND FACILITIES) OR COMPLIANCE WITH OTHER STATUTORY 27 AND REGULATORY REQUIREMENTS. 28 (3) DISPUTES CONCERNING FACILITIES SHALL BE SUBJECT TO 29 THE JURISDICTION OF THE COMMISSION AND MAY BE INITIATED BY 30 THE FILING OF A COMPLAINT UNDER SECTION 701 (RELATING TO 19990H1331B2032 - 33 -
1 COMPLAINTS) BY THE COMMISSION OR ANY INTERESTED PARTY. 2 (C) CUSTOMER BILLING.-- 3 (1) SUBJECT TO THE RIGHT OF A RETAIL GAS CUSTOMER TO 4 CHOOSE TO RECEIVE SEPARATE BILLS FROM ITS NATURAL GAS 5 SUPPLIER FOR NATURAL GAS SUPPLY SERVICE, THE NATURAL GAS 6 DISTRIBUTION COMPANY SHALL BE RESPONSIBLE FOR BILLING EACH OF 7 ITS RETAIL GAS CUSTOMERS FOR NATURAL GAS DISTRIBUTION 8 SERVICE, CONSISTENT WITH THE ORDERS OR REGULATIONS OF THE 9 COMMISSION, REGARDLESS OF THE IDENTITY OF THE PROVIDER OF 10 NATURAL GAS SUPPLY SERVICES. 11 (2) (I) BILLS TO RETAIL GAS CUSTOMERS SHALL CONTAIN 12 SUFFICIENT UNBUNDLED CHARGE INFORMATION TO ENABLE THE 13 CUSTOMER TO DETERMINE THE BASIS FOR THOSE CHARGES AND 14 SHALL COMPLY WITH SECTION 1509 (RELATING TO BILLING 15 PROCEDURES). AT A MINIMUM, SUCH CHARGES SHALL INCLUDE 16 THOSE SERVICES WHICH ARE UNBUNDLED AS A RESULT OF A 17 RESTRUCTURING FILING OR RULEMAKING. 18 (II) BILLS TO RETAIL RESIDENTIAL CUSTOMERS RENDERED 19 BY A NATURAL GAS DISTRIBUTION COMPANY FOR NATURAL GAS 20 DISTRIBUTION SERVICES SHALL INCLUDE INFORMATION REQUIRED 21 BY COMMISSION REGULATIONS GOVERNING STANDARDS AND BILLING 22 PRACTICES FOR RESIDENTIAL UTILITY SERVICE. 23 (III) BILLS RENDERED BY A NATURAL GAS DISTRIBUTION 24 COMPANY ON BEHALF OF A NATURAL GAS SUPPLIER SHALL 25 INCLUDE, IN A FORM AND MANNER DETERMINED BY THE NATURAL 26 GAS DISTRIBUTION COMPANY, IN CONSULTATION WITH THE 27 NATURAL GAS SUPPLIER, THE FOLLOWING INFORMATION WITH 28 RESPECT TO NATURAL GAS SUPPLIER SERVICES: THE NAME OF THE 29 NATURAL GAS SUPPLIER; THE RATES, CHARGES OR PRICES OF 30 NATURAL GAS SUPPLY SERVICES BILLED, INCLUDING ADJUSTMENTS 19990H1331B2032 - 34 -
1 TO PRIOR PERIOD BILLINGS, IF APPLICABLE, AND TAXES, IF 2 APPLICABLE; AND THE NATURAL GAS SUPPLIER'S TOLL-FREE 3 TELEPHONE NUMBER AND HOURS OF OPERATION FOR CUSTOMER 4 INQUIRIES. 5 (3) INCREMENTAL COSTS RELATING TO BILLING SERVICES 6 DESIGNED, IMPLEMENTED AND RENDERED BY THE NATURAL GAS 7 DISTRIBUTION COMPANY, AT ITS ELECTION, ON BEHALF OF A NATURAL 8 GAS SUPPLIER OR OTHER ENTITY MAY BE RECOVERED THROUGH FEES 9 CHARGED BY THE NATURAL GAS DISTRIBUTION COMPANY TO THE 10 NATURAL GAS SUPPLIER OR OTHER ENTITY. EITHER PARTY MAY 11 REQUEST THAT THE COMMISSION CONSIDER THE APPROPRIATE LEVEL OF 12 THE FEE. IN DOING SO, THE COMMISSION SHALL CONSIDER FEES 13 CHARGED BY OTHER NATURAL GAS DISTRIBUTION COMPANIES FOR 14 SIMILAR SERVICES. THE COMMISSION SHALL EITHER PERMIT THE FEE 15 TO CONTINUE AS SET OR SHALL ESTABLISH AN ALTERNATIVE 16 MECHANISM TO PERMIT FULL RECOVERY OF UNRECOVERED JUST AND 17 REASONABLE COSTS FROM THE SUPPLIER OR THE SUPPLIER'S 18 CUSTOMERS. NOTHING IN THIS SECTION SHALL PERMIT THE RECOVERY 19 OF SUCH COSTS FROM NATURAL GAS SUPPLY SERVICE CUSTOMERS OF 20 THE NATURAL GAS DISTRIBUTION COMPANY. 21 (4) IF SERVICES ARE PROVIDED BY AN ENTITY OTHER THAN THE 22 NATURAL GAS DISTRIBUTION COMPANY, THE ENTITY THAT PROVIDED 23 THOSE SERVICES SHALL FURNISH TO THE NATURAL GAS DISTRIBUTION 24 COMPANY BILLING DATA SUFFICIENT TO ENABLE THE NATURAL GAS 25 DISTRIBUTION COMPANY TO TIMELY BILL RETAIL GAS CUSTOMERS. THE 26 ENTITY SHALL PROVIDE DATA FOR BILLING PURPOSES IN A FORMAT 27 AND IN A TIME FRAME AS REQUIRED BY THE NATURAL GAS 28 DISTRIBUTION COMPANY. THE NATURAL GAS DISTRIBUTION COMPANY 29 SHALL CONSIDER THE DATA AND INFORMATION CONFIDENTIAL AND 30 SHALL TREAT IT AS SUCH. 19990H1331B2032 - 35 -
1 (5) NO NATURAL GAS DISTRIBUTION COMPANY SHALL BE 2 REQUIRED TO FORWARD PAYMENT TO ENTITIES PROVIDING SERVICES TO 3 CUSTOMERS AND ON WHOSE BEHALF THE NATURAL GAS DISTRIBUTION 4 COMPANY IS BILLING THOSE CUSTOMERS BEFORE THE NATURAL GAS 5 DISTRIBUTION COMPANY HAS RECEIVED PAYMENT FOR THOSE SERVICES 6 FROM CUSTOMERS. THE COMMISSION SHALL ISSUE GUIDELINES 7 ADDRESSING THE APPLICATION OF PARTIAL PAYMENTS. 8 (6) NATURAL GAS DISTRIBUTION COMPANIES AND NATURAL GAS 9 SUPPLIERS SHALL TAKE REASONABLE STEPS TO ALLOW RETAIL GAS 10 CUSTOMERS TO CONTRIBUTE VIA THEIR BILL TO HARDSHIP ENERGY 11 FUNDS WHICH BENEFIT LOW-INCOME RESIDENTIAL RETAIL GAS 12 CONSUMERS. 13 (D) ENHANCED METERING.--SUBJECT TO COMMISSION APPROVAL, THE 14 NATURAL GAS DISTRIBUTION COMPANY MAY REQUIRE THE INSTALLATION, 15 AT THE RETAIL GAS CUSTOMER'S EXPENSE, OF ENHANCED METERING 16 CAPABILITY SUFFICIENT TO MATCH THE NATURAL GAS DELIVERED BY THE 17 RETAIL GAS CUSTOMER'S NATURAL GAS SUPPLIER OR SUPPLIERS WITH 18 CONSUMPTION BY THAT RETAIL GAS CUSTOMER. IN EXERCISING ITS 19 DISCRETION, THE COMMISSION SHALL CONSIDER THE EFFECT ON LOW- 20 INCOME RETAIL GAS CUSTOMERS. 21 § 2206. CONSUMER PROTECTIONS AND CUSTOMER SERVICE. 22 (A) QUALITY.--A NATURAL GAS DISTRIBUTION COMPANY SHALL BE 23 RESPONSIBLE FOR CUSTOMER SERVICE FUNCTIONS CONSISTENT WITH THE 24 ORDERS AND REGULATIONS OF THE COMMISSION, INCLUDING, BUT NOT 25 LIMITED TO, METER READING, INSTALLATION, TESTING AND MAINTENANCE 26 AND EMERGENCY RESPONSE FOR ALL CUSTOMERS, AND COMPLAINT 27 RESOLUTION AND COLLECTIONS RELATED TO THE SERVICE PROVIDED BY 28 THE NATURAL GAS DISTRIBUTION COMPANY. CUSTOMER SERVICE AND 29 CONSUMER PROTECTIONS AND POLICIES FOR RETAIL GAS CUSTOMERS 30 SHALL, AT A MINIMUM, BE MAINTAINED AT THE SAME LEVEL OF QUALITY 19990H1331B2032 - 36 -
1 UNDER RETAIL COMPETITION AS IN EXISTENCE ON THE EFFECTIVE DATE 2 OF THIS CHAPTER. 3 (B) CHANGE OF SUPPLIERS.--THE COMMISSION SHALL, BY ORDER OR 4 REGULATION, ESTABLISH PROCEDURES TO ENSURE THAT A NATURAL GAS 5 DISTRIBUTION COMPANY DOES NOT CHANGE A RETAIL GAS CUSTOMER'S 6 NATURAL GAS SUPPLIER WITHOUT DIRECT ORAL CONFIRMATION FROM THE 7 CUSTOMER OF RECORD OR WRITTEN EVIDENCE OF THE CUSTOMER'S CONSENT 8 TO A CHANGE OF SUPPLIER. 9 (C) CUSTOMER INFORMATION.--THE COMMISSION SHALL, BY ORDER OR 10 REGULATION, ESTABLISH REQUIREMENTS THAT EACH NATURAL GAS 11 DISTRIBUTION COMPANY AND NATURAL GAS SUPPLIER PROVIDE ADEQUATE, 12 ACCURATE CUSTOMER INFORMATION TO ENABLE RETAIL GAS CUSTOMERS TO 13 MAKE INFORMED CHOICES REGARDING THE PURCHASE OF ALL NATURAL GAS 14 SERVICES OFFERED BY THAT PROVIDER. INFORMATION SHALL BE PROVIDED 15 TO RETAIL GAS CUSTOMERS IN AN UNDERSTANDABLE FORMAT THAT ENABLES 16 RETAIL GAS CUSTOMERS TO COMPARE PRICES AND SERVICES ON A UNIFORM 17 BASIS. 18 (D) CONSUMER EDUCATION.--PRIOR TO THE IMPLEMENTATION OF ANY 19 RESTRUCTURING PLAN UNDER SECTION 2204 (RELATING TO 20 IMPLEMENTATION), EACH NATURAL GAS DISTRIBUTION COMPANY, IN 21 CONJUNCTION WITH THE COMMISSION AND CONSISTENT WITH THE 22 GUIDELINES ESTABLISHED BY THE COMMISSION, SHALL IMPLEMENT A 23 CONSUMER EDUCATION PROGRAM TO INFORM CUSTOMERS OF THE CHANGES IN 24 THE NATURAL GAS UTILITY INDUSTRY. THE PROGRAM SHALL PROVIDE 25 RETAIL GAS CUSTOMERS WITH INFORMATION NECESSARY TO HELP THEM 26 MAKE APPROPRIATE CHOICES AS TO THEIR NATURAL GAS SERVICE. THE 27 EDUCATION PROGRAM SHALL BE SUBJECT TO APPROVAL BY THE 28 COMMISSION. THE CONSUMER EDUCATION PROGRAM SHALL INCLUDE GOALS, 29 OBJECTIVES AND AN ACTION PLAN THAT IS DESIGNED TO BE OBJECTIVE, 30 EASILY UNDERSTOOD, UTILIZES A UNIFORM MEASUREMENT AS ESTABLISHED 19990H1331B2032 - 37 -
1 BY THE COMMISSION FOR THE COST OF GAS, BE AVAILABLE IN LANGUAGES 2 THAT THE COMMISSION REQUIRES TO MEET THE NEEDS OF A SERVICE 3 TERRITORY AND BE SEPARATE AND DISTINCT FROM MARKETING. 4 (E) CONSUMER EDUCATION COST RECOVERY.--THE CONSUMER 5 EDUCATION PROGRAM SHALL BE SUBJECT TO APPROVAL BY THE COMMISSION 6 AND SHALL BE FUNDED IN EACH NATURAL GAS DISTRIBUTION SERVICE 7 TERRITORY BY A NONBYPASSABLE, COMPETITIVELY NEUTRAL COST 8 RECOVERY MECHANISM THAT FULLY RECOVERS THE REASONABLE COST OF 9 SUCH PROGRAM. TO THE EXTENT THAT THE INDUSTRIAL CUSTOMER CLASS 10 IS NOT CURRENTLY ASSIGNED SUCH COSTS ON THE EFFECTIVE DATE OF 11 THIS CHAPTER, IT SHALL NOT BE ASSIGNED SUCH COSTS IN THE FUTURE. 12 (F) TENANTS' RIGHTS.--NOTHING IN THIS CHAPTER SHALL BE 13 CONSTRUED TO RESTRICT THE RIGHTS OF TENANTS PURSUANT TO 14 SUBCHAPTER B OF CHAPTER 15 (RELATING TO DISCONTINUANCE OF 15 SERVICE TO LEASED PREMISES). 16 § 2207. OBLIGATION TO SERVE. 17 (A) SUPPLIER OF LAST RESORT.-- 18 (1) AFTER THE EFFECTIVE DATE OF THIS CHAPTER, THE 19 NATURAL GAS DISTRIBUTION COMPANY SHALL SERVE AS THE SUPPLIER 20 OF LAST RESORT FOR RESIDENTIAL, SMALL COMMERCIAL, SMALL 21 INDUSTRIAL AND ESSENTIAL HUMAN NEEDS CUSTOMERS AND ANY OTHER 22 CUSTOMER CLASSES DETERMINED BY THE COMMISSION IN THE NATURAL 23 GAS DISTRIBUTION COMPANY'S RESTRUCTURING PROCEEDING UNTIL 24 SUCH TIME AS THE COMMISSION, PURSUANT TO THIS SECTION, 25 APPROVES AN ALTERNATIVE SUPPLIER OR SUPPLIERS TO PROVIDE SUCH 26 SERVICES TO ANY OR ALL OF THE NATURAL GAS DISTRIBUTION 27 COMPANY'S CUSTOMERS. 28 (2) FOR PURPOSES OF THIS SECTION, A SUPPLIER OF LAST 29 RESORT IS A NATURAL GAS DISTRIBUTION COMPANY OR NATURAL GAS 30 SUPPLIER WHICH IS DESIGNATED BY THE COMMISSION TO PROVIDE 19990H1331B2032 - 38 -
1 NATURAL GAS SUPPLY SERVICE WITH RESPECT TO ONE OR MORE OF THE 2 FOLLOWING SERVICES: 3 (I) NATURAL GAS SUPPLY SERVICES TO THOSE CUSTOMERS 4 WHO HAVE NOT CHOSEN AN ALTERNATIVE NATURAL GAS SUPPLIER 5 OR WHO CHOOSE TO BE SERVED BY THEIR SUPPLIER OF LAST 6 RESORT; 7 (II) NATURAL GAS SUPPLY SERVICES TO THOSE CUSTOMERS 8 WHO ARE REFUSED SUPPLY SERVICE FROM A NATURAL GAS 9 SUPPLIER; OR 10 (III) NATURAL GAS SUPPLY SERVICES TO THOSE CUSTOMERS 11 WHOSE NATURAL GAS SUPPLIER HAS FAILED TO DELIVER ITS 12 REQUIREMENTS. 13 NO CUSTOMER SHALL HAVE MORE THAN ONE SUPPLIER OF LAST RESORT 14 DESIGNATED FOR ANY OF THE SERVICES SET FORTH IN THIS 15 PARAGRAPH. 16 (B) CONSUMER PROTECTION.--SERVICE BY THE SUPPLIER OF LAST 17 RESORT SHALL BE SUBJECT TO ALL CONSUMER PROTECTION STANDARDS, 18 INCLUDING THOSE CONTAINED IN 52 PA. CODE CH. 56 (RELATING TO 19 STANDARDS AND BILLING PRACTICES FOR RESIDENTIAL UTILITY SERVICE) 20 AND TO ALL UNIVERSAL SERVICE OBLIGATIONS. 21 (C) NATURAL GAS DISTRIBUTION COMPANY.--THE NATURAL GAS 22 DISTRIBUTION COMPANY SHALL DELIVER NATURAL GAS TO THE EXTENT 23 THAT IT IS PROVIDED BY ALL NATURAL GAS SUPPLIERS, OR SUPPLIERS 24 OF LAST RESORT, AS THE CASE MAY BE, IN ACCORDANCE WITH THE 25 NATURAL GAS DISTRIBUTION COMPANY'S TARIFF. 26 (D) STANDARDS OF SERVICE.--CONSISTENT WITH THE STANDARDS SET 27 FORTH IN SECTION 1501 (RELATING TO CHARACTER OF SERVICE AND 28 FACILITIES) AND APPLICABLE ORDERS OF THE COMMISSION, A SUPPLIER 29 OF LAST RESORT UNDER SUBSECTION (A)(2)(III) SHALL PROVIDE 30 SUFFICIENT SUPPLIES AS TO QUANTITY, QUALITY, PRESSURE AND 19990H1331B2032 - 39 -
1 LOCATION TO MEET THE OPERATIONAL RELIABILITY REQUIREMENTS OF THE 2 NATURAL GAS DISTRIBUTION COMPANY'S SYSTEM, INCLUDING, BUT NOT 3 LIMITED TO, A FAILURE OF ONE OR MORE NATURAL GAS SUPPLIERS TO: 4 (1) SUPPLY NATURAL GAS TO THEIR RETAIL GAS CUSTOMERS IN 5 CONFORMANCE WITH THEIR CONTRACTUAL OBLIGATIONS TO SUCH 6 CUSTOMERS; OR 7 (2) SATISFY APPLICABLE RELIABILITY STANDARDS AND 8 OBLIGATIONS. 9 (E) DISCONTINUATION OF SERVICE.--THE NATURAL GAS 10 DISTRIBUTION COMPANY SHALL CONTINUE PROVIDING SERVICES AS THE 11 SUPPLIER OF LAST RESORT TO ALL OF ITS CUSTOMERS FOR ALL OF THE 12 NATURAL GAS SUPPLY SERVICES DESCRIBED IN SUBSECTION (A)(2), 13 UNLESS, AT ITS DISCRETION, IT REQUESTS AND RECEIVES COMMISSION 14 APPROVAL TO DISCONTINUE PROVIDING ONE OR MORE SUCH SUPPLIER OF 15 LAST RESORT OBLIGATION. IN APPROVING SUCH A PETITION, THE 16 COMMISSION SHALL ALSO APPROVE ANOTHER PARTY AS THE ALTERNATIVE 17 SUPPLIER OF LAST RESORT FOR EACH CUSTOMER OR CUSTOMER GROUP FOR 18 WHICH THE NATURAL GAS DISTRIBUTION COMPANY NO LONGER PROVIDES 19 SUCH NATURAL GAS SUPPLY SERVICES. 20 (F) REGULATIONS.--THE COMMISSION SHALL PROMULGATE 21 REGULATIONS SETTING FORTH THE STANDARDS FOR APPROVING AN 22 ALTERNATIVE SUPPLIER OF LAST RESORT CONSISTENT WITH THE 23 PROVISIONS OF THIS TITLE, INCLUDING A MECHANISM TO ENSURE THAT 24 THE RATES CHARGED BY ANY ALTERNATE SUPPLIER OF LAST RESORT ARE 25 JUST AND REASONABLE. 26 (G) ORGANIZED LABOR.--DURING THE FIVE-YEAR PERIOD FOLLOWING 27 THE EFFECTIVE DATE OF THIS CHAPTER, APPROVAL OF AN ALTERNATIVE 28 SUPPLIER OF LAST RESORT PURSUANT TO SUBSECTION (E) SHALL NOT BE 29 GRANTED UNLESS THE ENTITY DESIGNATED BY THE COMMISSION TO 30 SUCCEED THE NATURAL GAS DISTRIBUTION COMPANY IN THE PROVISION 19990H1331B2032 - 40 -
1 OF SERVICE TO THESE CUSTOMERS AGREES TO RECOGNIZE RELEVANT UNION 2 AND COLLECTIVE BARGAINING AGREEMENTS OF THE NATURAL GAS 3 DISTRIBUTION COMPANY THEN IN PLACE. 4 (H) PETITION TO BECOME SUPPLIER OF LAST RESORT.--AFTER THE 5 FIVE-YEAR PERIOD FOLLOWING THE EFFECTIVE DATE OF THIS CHAPTER, 6 ANY PARTY MAY PETITION THE COMMISSION TO BECOME THE SUPPLIER OF 7 LAST RESORT TO SOME OR ALL CUSTOMERS EXCEPT FOR THOSE CUSTOMERS 8 IDENTIFIED IN SUBSECTION (A)(2)(I). 9 (I) NOTICE REQUIRED PRIOR TO MARKET EXIT.-- 10 (1) A NATURAL GAS SUPPLIER MAY NOT EXIT THE MARKET 11 WITHOUT PROVIDING NOTICE AS DETERMINED BY THE COMMISSION IN 12 THE RESTRUCTURING PROCEEDING OF THE NATURAL GAS DISTRIBUTION 13 COMPANY TO ITS CUSTOMERS, THE SUPPLIER OF LAST RESORT AND THE 14 NATURAL GAS DISTRIBUTION COMPANY. 15 (2) IF FIRM GAS SUPPLY CONTRACTS WITH PENNSYLVANIA 16 NATURAL GAS PRODUCERS OR STORAGE OR TRANSPORTATION CAPACITY 17 CONTRACTS USED BY THE NATURAL GAS SUPPLIER TO SERVE SUCH 18 RETAIL GAS CUSTOMERS WERE EITHER ASSIGNED OR RELEASED TO THE 19 NATURAL GAS SUPPLIER OR CONSTITUTE CAPACITY WHICH WAS 20 ACQUIRED BY THE NATURAL GAS SUPPLIER AS THE RESULT OF 21 NONRENEWAL OF A STORAGE OR TRANSPORTATION CAPACITY CONTRACT 22 PREVIOUSLY HELD BY THE NATURAL GAS DISTRIBUTION COMPANY, THE 23 NATURAL GAS SUPPLIER SHALL OFFER THE SUPPLIER OF LAST RESORT 24 OR SUCCESSOR NATURAL GAS SUPPLIER A RIGHT OF FIRST REFUSAL TO 25 UTILIZE SUCH PENNSYLVANIA SUPPLY CONTRACTS OR STORAGE OR 26 TRANSPORTATION CAPACITY CONTRACTS AT ITS CONTRACT COST AS 27 LONG AS NEEDED TO SERVE THOSE CUSTOMERS. 28 (3) IF THE STORAGE OR TRANSPORTATION CAPACITY CONTRACTS 29 HELD BY THE NATURAL GAS SUPPLIER WERE ACQUIRED IN ANOTHER 30 MANNER, AND THERE WAS NOT SUFFICIENT NOTICE GIVEN TO THE 19990H1331B2032 - 41 -
1 SUPPLIER OF LAST RESORT AND THE NATURAL GAS DISTRIBUTION 2 COMPANY, OR IF THERE IS NOT ALTERNATIVE STORAGE OR 3 TRANSPORTATION CAPACITY AVAILABLE WHICH IS OPERATIONALLY 4 SUFFICIENT TO SERVE THE MARKET THE NATURAL GAS SUPPLIER WAS 5 SERVING, THEN THE SUPPLIER OF LAST RESORT SHALL BE PROVIDED 6 WITH A RIGHT TO USE SUCH STORAGE OR TRANSPORTATION CAPACITY 7 AS DESIGNATED BY THE NATURAL GAS SUPPLIER, AT THE CONTRACT 8 COST, UNTIL THE SUPPLIER OF LAST RESORT IS ABLE TO ACQUIRE 9 REPLACEMENT CAPACITY SUFFICIENT TO SERVE ITS CUSTOMERS USING 10 REASONABLE AND DILIGENT EFFORTS TO DO SO. 11 (4) IF A DISPUTE ARISES UNDER THIS SUBSECTION, THE 12 AGGRIEVED PARTY MAY FILE A COMPLAINT WITH THE COMMISSION FOR 13 RESOLUTION WITHIN 45 DAYS. 14 (J) DUTY INVOLVING LOST CUSTOMERS.--TO THE EXTENT THAT A 15 NATURAL GAS SUPPLIER LOSES RETAIL GAS CUSTOMERS SUCH THAT ITS 16 CAPACITY REQUIREMENTS TO A NATURAL GAS DISTRIBUTION COMPANY ARE 17 REDUCED BELOW THE LEVEL ESTABLISHED BY THE COMMISSION FOR SUCH 18 PURPOSE IN THE NATURAL GAS DISTRIBUTION COMPANY'S RESTRUCTURING 19 PROCEEDING, THE NATURAL GAS SUPPLIER SHALL HAVE THE SAME 20 OBLIGATIONS SET FORTH IN SUBSECTION (I). 21 (K) RATE AFTER SERVICE DISCONTINUED.--IN THE EVENT THE 22 NATURAL GAS SUPPLIER DISCONTINUES SERVICE OR DEFAULTS BEFORE ITS 23 CONTRACT WITH THE CUSTOMER EXPIRES, THE RETAIL GAS CUSTOMER 24 SHALL BE SERVED BY THE SUPPLIER OF LAST RESORT AT THE 25 COMMISSION-APPROVED SUPPLIER OF LAST RESORT RATE COMMENCING WITH 26 THE NEXT BILLING CYCLE. HOWEVER, THE RETAIL GAS CUSTOMER SHALL 27 CONTINUE TO BE CHARGED THE RATE THE CUSTOMER NEGOTIATED WITH THE 28 DISCONTINUING OR DEFAULTING NATURAL GAS SUPPLIER FOR THE 29 REMAINDER OF THE BILLING CYCLE. ANY DIFFERENCE BETWEEN THE COST 30 INCURRED BY THE SUPPLIER OF LAST RESORT AND THE AMOUNT PAYABLE 19990H1331B2032 - 42 -
1 BY THE RETAIL GAS CUSTOMER SHALL BE RECOVERED FROM THE NATURAL 2 GAS SUPPLIER OR FROM THE BOND OR OTHER SECURITY PROVIDED BY THE 3 NATURAL GAS SUPPLIER WITHOUT RECOURSE TO ANY RETAIL GAS CUSTOMER 4 NOT OTHERWISE CONTRACTUALLY COMMITTED FOR THE DIFFERENCE. 5 § 2208. REQUIREMENTS FOR NATURAL GAS SUPPLIERS. 6 (A) LICENSE REQUIREMENTS.--NO ENTITY SHALL ENGAGE IN THE 7 BUSINESS OF A NATURAL GAS SUPPLIER UNLESS IT HOLDS A LICENSE 8 ISSUED BY THE COMMISSION. TO THE EXTENT THAT A NATURAL GAS 9 DISTRIBUTION COMPANY PROVIDES NATURAL GAS SUPPLY SERVICE OUTSIDE 10 OF ITS CHARTERED OR CERTIFICATED TERRITORY, IT ALSO MUST HOLD A 11 LICENSE. A LICENSE SHALL NOT BE REQUIRED FOR CUSTOMERS WHO MAKE 12 DE MINIMIS INCIDENTAL SALES OR RESALES TO THEMSELVES, AN 13 AFFILIATE OR TO OTHER NONRESIDENTIAL RETAIL GAS CUSTOMERS. 14 (B) LICENSE APPLICATION AND ISSUANCE.--AN APPLICATION FOR A 15 NATURAL GAS SUPPLIER LICENSE SHALL BE MADE TO THE COMMISSION IN 16 WRITING, BE VERIFIED BY OATH OR AFFIRMATION AND BE IN SUCH FORM 17 AND CONTAIN SUCH INFORMATION AS THE COMMISSION MAY, BY RULE OR 18 ORDER, REQUIRE. A LICENSE SHALL BE ISSUED TO ANY APPLICANT, 19 AUTHORIZING THE WHOLE OR ANY PART OF THE SERVICE COVERED BY THE 20 APPLICATION, IF IT IS FOUND THAT THE APPLICANT IS FIT, WILLING 21 AND ABLE TO PERFORM PROPERLY THE SERVICE PROPOSED AND TO CONFORM 22 TO THE APPLICABLE PROVISIONS OF THIS TITLE AND THE ORDERS AND 23 REGULATIONS OF THE COMMISSION, INCLUDING THOSE CONCERNING 24 STANDARDS AND BILLING PRACTICES, AND THAT THE PROPOSED SERVICE, 25 TO THE EXTENT AUTHORIZED BY THE LICENSE, WILL BE CONSISTENT WITH 26 THE PUBLIC INTEREST. OTHERWISE, SUCH APPLICATION SHALL BE 27 DENIED. 28 (C) FINANCIAL FITNESS.-- 29 (1) IN ORDER TO ENSURE THE SAFETY AND RELIABILITY OF THE 30 NATURAL GAS SUPPLY SERVICE IN THIS COMMONWEALTH, NO NATURAL 19990H1331B2032 - 43 -
1 GAS SUPPLIER LICENSE SHALL BE ISSUED OR REMAIN IN FORCE 2 UNLESS THE APPLICANT OR HOLDER, AS THE CASE MAY BE, COMPLIES 3 WITH ALL OF THE FOLLOWING: 4 (I) FURNISHES A BOND OR OTHER SECURITY IN A FORM AND 5 AMOUNT TO ENSURE THE FINANCIAL RESPONSIBILITY OF THE 6 NATURAL GAS SUPPLIER. THE CRITERIA EACH NATURAL GAS 7 DISTRIBUTION COMPANY SHALL USE TO DETERMINE THE AMOUNT 8 AND FORM OF SUCH BOND OR OTHER SECURITY SHALL BE SET 9 FORTH IN THE NATURAL GAS DISTRIBUTION COMPANY'S 10 RESTRUCTURING FILING. IN APPROVING THE CRITERIA, 11 COMMISSION CONSIDERATIONS SHALL INCLUDE, BUT NOT BE 12 LIMITED TO, THE FINANCIAL IMPACT ON THE NATURAL GAS 13 DISTRIBUTION COMPANY OR AN ALTERNATIVE SUPPLIER OF LAST 14 RESORT OF A DEFAULT OR SUBSEQUENT BANKRUPTCY OF A NATURAL 15 GAS SUPPLIER. THE COMMISSION SHALL PERIODICALLY REVIEW 16 THE CRITERIA UPON PETITION BY ANY PARTY. THE AMOUNT AND 17 FORM OF THE BOND OR OTHER SECURITY MAY BE MUTUALLY AGREED 18 TO BETWEEN THE NATURAL GAS DISTRIBUTION COMPANY OR THE 19 ALTERNATE SUPPLIER OF LAST RESORT AND THE NATURAL GAS 20 SUPPLIER OR FAILING THAT SHALL BE DETERMINED BY CRITERIA 21 APPROVED BY THE COMMISSION. 22 (II) PROVIDES THE COMMISSION WITH THE ADDRESS OF THE 23 PARTICIPANT'S PRINCIPAL OFFICE IN THIS COMMONWEALTH OR 24 THE ADDRESS OF THE PARTICIPANT'S REGISTERED AGENT IN THIS 25 COMMONWEALTH, THE LATTER BEING THE ADDRESS AT WHICH THE 26 PARTICIPANT MAY BE SERVED PROCESS. 27 (2) FAILURE OF A NATURAL GAS SUPPLIER TO COMPLY WITH ANY 28 PROVISION OF THIS CHAPTER OR THE RULES, REGULATIONS, ORDERS 29 OR DIRECTIVES OF THE DEPARTMENT OF REVENUE OR OF THE 30 COMMISSION, INCLUDING, BUT NOT LIMITED TO, ENGAGING IN 19990H1331B2032 - 44 -
1 ANTICOMPETITIVE BEHAVIOR, SHALL BE CAUSE FOR THE COMMISSION 2 TO REVOKE THE LICENSE OF THE NATURAL GAS SUPPLIER. 3 (D) TRANSFERABILITY OF LICENSES.--NO LICENSE ISSUED UNDER 4 THIS CHAPTER MAY BE TRANSFERRED WITHOUT PRIOR COMMISSION 5 APPROVAL. 6 (E) FORM OF REGULATION OF NATURAL GAS SUPPLIERS.--EXCEPT 7 WHERE A NATURAL GAS SUPPLIER SERVES AS A SUPPLIER OF LAST 8 RESORT, THE COMMISSION MAY FORBEAR FROM EXTENDING ITS REGULATION 9 OF NATURAL GAS SUPPLIERS BEYOND LICENSING, BONDING, RELIABILITY 10 AND CONSUMER SERVICES AND PROTECTIONS, INCLUDING ALL APPLICABLE 11 PORTIONS OF 52 PA. CODE CH. 56 (RELATING TO STANDARDS AND 12 BILLING PRACTICES FOR RESIDENTIAL UTILITY SERVICE). SUBJECT TO 13 THE PROVISIONS OF SECTION 2207 (RELATING TO OBLIGATION TO 14 SERVE), NOTHING IN THIS SECTION SHALL PRECLUDE A NATURAL GAS 15 SUPPLIER, UPON APPROPRIATE AND REASONABLE NOTICE TO THE RETAIL 16 GAS CUSTOMER, SUPPLIER OF LAST RESORT, AND THE NATURAL GAS 17 DISTRIBUTION COMPANY, FROM CANCELING ITS CONTRACT WITH ANY 18 CUSTOMER FOR LEGAL CAUSE, SUBJECT TO THE CUSTOMER'S RIGHT TO 19 HAVE CONTINUED SERVICE FROM THE SUPPLIER OF LAST RESORT. 20 (F) AVAILABILITY OF THE SERVICE OF NATURAL GAS SUPPLIERS.-- 21 PRIOR TO LICENSING ANY NATURAL GAS SUPPLIER, THE COMMISSION 22 SHALL SET FORTH STANDARDS TO ENSURE THAT ALL CUSTOMER CLASSES 23 MAY CHOOSE TO PURCHASE NATURAL GAS FROM A NATURAL GAS SUPPLIER. 24 THE COMMISSION SHALL ALSO ENSURE THAT NATURAL GAS SUPPLIERS 25 COMPLY WITH APPLICABLE PROVISIONS OF 52 PA. CODE CH. 56. 26 (G) OPEN AND NONDISCRIMINATORY ACCESS.--IN ADDITION TO 27 MEETING THE LICENSE REQUIREMENTS APPLICABLE TO APPLICANTS UNDER 28 SUBSECTION (B), A MUNICIPAL CORPORATION SHALL, BEFORE IT IS 29 PERMITTED TO PROVIDE NATURAL GAS SUPPLY SERVICES AS A NATURAL 30 GAS SUPPLIER, DEMONSTRATE, AND THE COMMISSION SHALL DETERMINE, 19990H1331B2032 - 45 -
1 THAT BY THE DATE OF THE ISSUANCE OF THE LICENSE, IT WILL PROVIDE 2 OTHER NATURAL GAS SUPPLIERS OPEN AND NONDISCRIMINATORY ACCESS TO 3 ITS GAS DISTRIBUTION SYSTEM UNDER STANDARDS THAT ARE COMPARABLE 4 TO THIS TITLE, TAKING INTO CONSIDERATION THE PARTICULAR 5 CIRCUMSTANCES OF THE MUNICIPAL CORPORATION'S OWNERSHIP AND/OR 6 OPERATION OF THE GAS DISTRIBUTION SYSTEM. 7 § 2209. MARKET POWER REMEDIATION. 8 (A) INTERIM STANDARDS OF CONDUCT.--WITHIN 120 DAYS OF THE 9 EFFECTIVE DATE OF THIS CHAPTER, THE COMMISSION SHALL PROVIDE BY 10 ORDER BINDING, INTERIM GUIDELINES FOR STANDARDS OF CONDUCT 11 GOVERNING THE ACTIVITIES OF AND RELATIONSHIPS BETWEEN NATURAL 12 GAS DISTRIBUTION COMPANIES AND THEIR AFFILIATED NATURAL GAS 13 SUPPLIERS AND OTHER NATURAL GAS SUPPLIERS AND MONITOR AND 14 ENFORCE COMPLIANCE WITH THOSE STANDARDS. 15 (B) PERMANENT STANDARDS OF CONDUCT.--THE COMMISSION SHALL 16 THEREUPON PROMULGATE REGULATIONS SETTING FORTH PERMANENT 17 STANDARDS OF CONDUCT GOVERNING THE ACTIVITIES OF AND 18 RELATIONSHIPS BETWEEN NATURAL GAS DISTRIBUTION COMPANIES AND 19 THEIR AFFILIATED NATURAL GAS SUPPLIERS AND OTHER NATURAL GAS 20 SUPPLIERS AND MONITOR AND ENFORCE COMPLIANCE WITH THESE 21 STANDARDS. THE COMMISSION SHALL NEITHER FAVOR NOR DISFAVOR 22 CONDUCT OR OPERATIONS BY AND BETWEEN A NATURAL GAS DISTRIBUTION 23 COMPANY AND AN AFFILIATED NATURAL GAS SUPPLIER OR A 24 NONAFFILIATED NATURAL GAS SUPPLIER. 25 (C) CONTENTS OF STANDARDS.--STANDARDS OF CONDUCT SHALL 26 PROVIDE FOR: 27 (1) NO DISCRIMINATION AGAINST OR PREFERENTIAL TREATMENT 28 OF ANY NATURAL GAS SUPPLIER, INCLUDING AN AFFILIATED NATURAL 29 GAS SUPPLIER. 30 (2) NO DISCLOSURE OR PREFERENTIAL SHARING OF ANY 19990H1331B2032 - 46 -
1 CONFIDENTIAL INFORMATION TO OR WITH ANY INDIVIDUAL NATURAL 2 GAS SUPPLIER. 3 (3) ADEQUATE RULES PROHIBITING CROSS-SUBSIDIZATION OF AN 4 AFFILIATED NATURAL GAS SUPPLIER BY A NATURAL GAS DISTRIBUTION 5 COMPANY. 6 (4) MAINTENANCE OF SEPARATE BOOKS AND RECORDS BY THE 7 NATURAL GAS DISTRIBUTION COMPANY AND ITS AFFILIATED NATURAL 8 GAS SUPPLIER. 9 (5) SUFFICIENT PHYSICAL AND OPERATIONAL SEPARATION, BUT 10 NOT INCLUDING LEGAL DIVESTITURE, TO ACCOMPLISH PARAGRAPHS 11 (1), (2), (3) AND (4). 12 (6) AN INFORMAL DISPUTE RESOLUTION PROCEDURE. 13 (7) A SYSTEM OF PENALTIES FOR NONCOMPLIANCE WITH THE 14 FINAL SET OF STANDARDS OF CONDUCT CONSISTENT WITH EXISTING 15 COMMISSION REGULATIONS. 16 (D) LIMITATION.--THE STANDARDS SHALL NOT PROHIBIT THE 17 NATURAL GAS DISTRIBUTION COMPANY AND ITS AFFILIATED NATURAL GAS 18 SUPPLIER FROM USING OR SHARING SIMILAR CORPORATE NAMES, 19 TRADEMARKS, TRADE DRESS OR SERVICE MARKS. 20 (E) INITIATION OF INVESTIGATIONS.--UPON COMPLAINT OR UPON 21 ITS OWN MOTION, FOR GOOD CAUSE SHOWN, THE COMMISSION SHALL 22 CONDUCT AN INVESTIGATION OF THE IMPACT ON THE PROPER FUNCTIONING 23 OF A FULLY COMPETITIVE RETAIL NATURAL GAS MARKET, OF MERGERS, 24 CONSOLIDATIONS, ACQUISITION OR DISPOSITION OF ASSETS OR 25 SECURITIES OF NATURAL GAS SUPPLIERS AND ANTICOMPETITIVE OR 26 DISCRIMINATORY CONDUCT AFFECTING THE RETAIL DISTRIBUTION OF 27 NATURAL GAS. 28 (F) CONDUCT OF INVESTIGATIONS.-- 29 (1) THE COMMISSION MAY REQUIRE A NATURAL GAS SUPPLIER TO 30 PROVIDE INFORMATION, INCLUDING DOCUMENTS AND TESTIMONY, IN 19990H1331B2032 - 47 -
1 ACCORDANCE WITH THE COMMISSION'S REGULATIONS REGARDING THE 2 DISCOVERY OF INFORMATION. 3 (2) MATERIAL WHICH THE COMMISSION DETERMINES TO BE 4 CONFIDENTIAL, PROPRIETARY OR TRADE SECRET INFORMATION 5 PROVIDED UNDER THIS SUBSECTION SHALL NOT BE DISCLOSED TO ANY 6 PERSON NOT DIRECTLY EMPLOYED OR RETAINED BY THE COMMISSION TO 7 CONDUCT THE INVESTIGATION WITHOUT THE CONSENT OF THE PARTY 8 PROVIDING THE INFORMATION. 9 (3) NOTWITHSTANDING THE PROHIBITION ON DISCLOSURE OF 10 INFORMATION IN PARAGRAPH (2), THE COMMISSION SHALL DISCLOSE 11 INFORMATION OBTAINED UNDER THIS SUBSECTION TO THE OFFICE OF 12 CONSUMER ADVOCATE AND THE OFFICE OF SMALL BUSINESS ADVOCATE 13 UNDER AN APPROPRIATE CONFIDENTIALITY AGREEMENT. THE 14 COMMISSION MAY DISCLOSE THE INFORMATION TO APPROPRIATE 15 FEDERAL OR STATE LAW ENFORCEMENT OFFICIALS IF IT DETERMINES 16 THAT THE DISCLOSURE OF THE INFORMATION IS NECESSARY TO 17 PREVENT OR RESTRAIN A VIOLATION OF FEDERAL OR STATE LAW AND 18 IT PROVIDES THE PARTY THAT PROVIDED THE INFORMATION WITH 19 REASONABLE NOTICE AND OPPORTUNITY TO PREVENT OR LIMIT 20 DISCLOSURE. 21 (G) REFERRALS AND INVESTIGATION.--IF, AS A RESULT OF THE 22 INVESTIGATION CONDUCTED UNDER THIS SECTION, THE COMMISSION HAS 23 REASON TO BELIEVE THAT ANTICOMPETITIVE OR DISCRIMINATORY 24 CONDUCT, INCLUDING THE UNLAWFUL EXERCISE OF MARKET POWER, IS 25 PREVENTING THE RETAIL GAS CUSTOMERS FROM OBTAINING THE BENEFITS 26 OF A PROPERLY FUNCTIONING AND EFFECTIVELY COMPETITIVE RETAIL 27 NATURAL GAS MARKET, THE COMMISSION, PURSUANT TO ITS REGULATIONS, 28 SHALL: 29 (1) REFER ITS FINDINGS TO THE ATTORNEY GENERAL, THE 30 UNITED STATES DEPARTMENT OF JUSTICE, THE SECURITIES AND 19990H1331B2032 - 48 -
1 EXCHANGE COMMISSION OR THE FEDERAL ENERGY REGULATORY 2 COMMISSION. 3 (2) SUBJECT TO SUBSECTION (C)(3), DISCLOSE ANY 4 INFORMATION IT HAS OBTAINED IN THE COURSE OF ITS 5 INVESTIGATION TO THE AGENCY OR AGENCIES TO WHICH IT HAD MADE 6 A REFERRAL UNDER PARAGRAPH (1). 7 (3) INTERVENE, AS PROVIDED AND PERMITTED BY LAW OR 8 REGULATION, IN ANY PROCEEDINGS INITIATED AS A RESULT OF A 9 REFERRAL MADE UNDER PARAGRAPH (1). 10 (H) MARKETING STANDARDS.--AS PART OF EACH NATURAL GAS 11 DISTRIBUTION COMPANY'S RESTRUCTURING PROCEEDING, THE COMMISSION 12 MAY, IN ITS DISCRETION, DEVELOP AND APPLY DIFFERENT STANDARDS OF 13 CONDUCT TO THE NATURAL GAS DISTRIBUTION COMPANY'S MARKETING 14 ACTIVITIES RELATED TO NATURAL GAS SUPPLY SERVICES. NO SUCH 15 STANDARDS SHALL APPLY TO THE NATURAL GAS DISTRIBUTION COMPANY'S 16 MARKETING DIVISION OR OPERATIONS UNTIL THE COMMISSION ISSUES AN 17 ORDER IN THE CONTEXT OF THAT NATURAL GAS DISTRIBUTION COMPANY'S 18 RESTRUCTURING PROCEEDING. 19 (I) DEFINITION.--SUBJECT TO THE CONDITIONS SET FORTH IN 20 SUBSECTION (H), FOR THE PURPOSES OF THIS SECTION, THE TERM 21 "AFFILIATED NATURAL GAS SUPPLIER" INCLUDES MARKETING ACTIVITIES 22 RELATED TO NATURAL GAS SUPPLY SERVICES BY THE MARKETING DIVISION 23 OR THE MARKETING OPERATION OF A NATURAL GAS DISTRIBUTION 24 COMPANY. 25 § 2210. APPROVAL OF PROPOSED MERGERS, CONSOLIDATIONS, 26 ACQUISITIONS OR DISPOSITIONS. 27 (A) GENERAL RULE.--IN THE EXERCISE OF AUTHORITY THE 28 COMMISSION OTHERWISE MAY HAVE TO APPROVE MERGERS OR 29 CONSOLIDATIONS INVOLVING NATURAL GAS DISTRIBUTION COMPANIES OR 30 NATURAL GAS SUPPLIERS OR THE ACQUISITION OR DISPOSITION OF 19990H1331B2032 - 49 -
1 ASSETS OR SECURITIES OF NATURAL GAS DISTRIBUTION COMPANIES OR 2 NATURAL GAS SUPPLIERS, THE COMMISSION SHALL CONSIDER: 3 (1) WHETHER THE PROPOSED MERGER, CONSOLIDATION, 4 ACQUISITION OR DISPOSITION IS LIKELY TO RESULT IN 5 ANTICOMPETITIVE OR DISCRIMINATORY CONDUCT, INCLUDING THE 6 UNLAWFUL EXERCISE OF MARKET POWER, WHICH WILL PREVENT RETAIL 7 GAS CUSTOMERS FROM OBTAINING THE BENEFITS OF A PROPERLY 8 FUNCTIONING AND EFFECTIVELY COMPETITIVE RETAIL NATURAL GAS 9 MARKET. 10 (2) THE EFFECT OF THE PROPOSED MERGER, CONSOLIDATION, 11 ACQUISITION OR DISPOSITION ON THE EMPLOYEES OF THE NATURAL 12 GAS DISTRIBUTION COMPANY AND ON ANY AUTHORIZED COLLECTIVE 13 BARGAINING AGENT REPRESENTING THOSE EMPLOYEES. 14 (B) PROCEDURE.--UPON REQUEST FOR ANY APPROVAL IDENTIFIED IN 15 SUBSECTION (A), THE COMMISSION SHALL PROVIDE NOTICE AND AN 16 OPPORTUNITY FOR OPEN, PUBLIC EVIDENTIARY HEARINGS. IF THE 17 COMMISSION FINDS, AFTER HEARING, THAT A PROPOSED MERGER, 18 CONSOLIDATION, ACQUISITION OR DISPOSITION IS LIKELY TO RESULT IN 19 ANTICOMPETITIVE OR DISCRIMINATORY CONDUCT, INCLUDING THE 20 UNLAWFUL EXERCISE OF MARKET POWER, WHICH WILL PREVENT RETAIL GAS 21 CUSTOMERS FROM OBTAINING BENEFITS OF A PROPERLY FUNCTIONING AND 22 EFFECTIVELY COMPETITIVE RETAIL NATURAL GAS MARKET, THE 23 COMMISSION SHALL NOT APPROVE SUCH PROPOSED MERGER, 24 CONSOLIDATION, ACQUISITION OR DISPOSITION, EXCEPT UPON SUCH 25 TERMS AND CONDITIONS AS IT FINDS NECESSARY TO PRESERVE THE 26 BENEFITS OF A PROPERLY FUNCTIONING AND EFFECTIVELY COMPETITIVE 27 RETAIL NATURAL GAS MARKET. 28 (C) PRESERVATION OF RIGHTS.--NOTHING IN THIS SECTION SHALL 29 RESTRICT THE RIGHT OF ANY PARTY TO PURSUE ANY OTHER REMEDY 30 AVAILABLE TO IT. 19990H1331B2032 - 50 -
1 § 2211. RATE CAPS. 2 (A) GENERAL RULE.--EXCEPT AS PROVIDED UNDER SUBSECTIONS (D), 3 (E), (F) AND (G), FOR A PERIOD FROM THE EFFECTIVE DATE OF THIS 4 CHAPTER UNTIL JANUARY 1, 2001, THE TOTAL NON-GAS COST CHARGES OF 5 A NATURAL GAS DISTRIBUTION COMPANY FOR SERVICE TO ANY RETAIL GAS 6 CUSTOMER SHALL NOT EXCEED THE MAXIMUM NON-GAS COST CHARGES THAT 7 ARE CONTAINED IN THE NATURAL GAS DISTRIBUTION COMPANY'S TARIFF 8 AS OF THE EFFECTIVE DATE OF THIS CHAPTER. 9 (B) RECOVERY OF DEFERRED COSTS.-- 10 (1) IN A RESTRUCTURING PROCEEDING, THE NATURAL GAS 11 DISTRIBUTION COMPANY MAY IDENTIFY CATEGORIES OF COSTS 12 RESULTING FROM THIS CHAPTER. 13 (2) THE NATURAL GAS DISTRIBUTION COMPANY MAY SEEK 14 PERMISSION IN ITS RESTRUCTURING PROCEEDING TO CAPITALIZE AND 15 TO AMORTIZE SUCH COSTS OVER AN APPROPRIATE PERIOD TO BE 16 DETERMINED BY THE COMMISSION. THE AMORTIZATION SHALL COMMENCE 17 AT THE TIME WHEN RESTRUCTURING ORDERS ARE ISSUED. THE NATURAL 18 GAS DISTRIBUTION COMPANY MAY SEEK RECOVERY OF THE UNAMORTIZED 19 BALANCE OF SUCH COSTS IN A FUTURE RATE PROCEEDING AND THE 20 COMMISSION SHALL ALLOW RECOVERY OF SUCH COSTS PROVIDED THAT 21 THE COMMISSION DETERMINES THAT SUCH COSTS ARE REASONABLE AND 22 THAT THE RESULTING RATES ARE JUST AND REASONABLE. 23 (C) DEFERRAL OF COSTS.--COSTS RECOVERABLE UNDER SECTIONS 24 2203(6) (RELATING TO STANDARDS FOR RESTRUCTURING OF NATURAL GAS 25 UTILITY INDUSTRY) AND 2206(E) (RELATING TO CONSUMER PROTECTIONS 26 AND CUSTOMER SERVICE), IN EXCESS OF AMOUNTS ALREADY REFLECTED IN 27 A NATURAL GAS DISTRIBUTION COMPANY'S RATES, WHICH ARE INCURRED 28 BETWEEN THE DATE OF ENTRY OF THE COMMISSION'S RESTRUCTURING 29 ORDER AND THE EARLIER OF THE DATE ON WHICH THE COMMISSION 30 AUTHORIZES COMMENCEMENT OF RECOVERY OR JUNE 30, 2002, MAY BE 19990H1331B2032 - 51 -
1 DEFERRED FOR RECOVERY IN THE FUTURE. SUCH DEFERRALS SHALL BE 2 WITHOUT INTEREST. 3 (D) CIRCUMSTANCES FOR EXCEPTIONS.--A NATURAL GAS 4 DISTRIBUTION COMPANY MAY SEEK, AND THE COMMISSION MAY APPROVE, 5 AN EXCEPTION TO THE LIMITATIONS SET FORTH IN THIS SECTION UNDER 6 ANY OF THE FOLLOWING CIRCUMSTANCES: 7 (1) THE NATURAL GAS DISTRIBUTION COMPANY MEETS THE 8 REQUIREMENTS FOR EXTRAORDINARY RELIEF UNDER SECTION 1308(E) 9 (RELATING TO VOLUNTARY CHANGES IN RATES). 10 (2) THE NATURAL GAS DISTRIBUTION COMPANY DEMONSTRATES 11 THAT A RATE INCREASE IS NECESSARY IN ORDER TO PRESERVE THE 12 RELIABILITY OF THE NATURAL GAS DISTRIBUTION SYSTEM. 13 (3) THE NATURAL GAS DISTRIBUTION COMPANY IS SUBJECT TO 14 SIGNIFICANT INCREASES IN THE RATE OF FEDERAL TAXES OR OTHER 15 SIGNIFICANT INCREASES IN COSTS RESULTING FROM CHANGES IN LAW 16 OR REGULATIONS THAT WOULD NOT ALLOW THE NATURAL GAS 17 DISTRIBUTION COMPANY TO EARN A FAIR RATE OF RETURN. 18 (E) INTERCLASS AND INTRACLASS COST SHIFTS.--FOR THE PERIOD 19 FROM THE EFFECTIVE DATE OF THIS CHAPTER UNTIL JANUARY 1, 2001, 20 INTERCLASS OR INTRACLASS COST SHIFTS ARE PROHIBITED. THIS 21 PROHIBITION AGAINST COST SHIFTING MAY BE ACCOMPLISHED BY 22 MAINTAINING THE COST ALLOCATION METHODOLOGY ACCEPTED BY THE 23 COMMISSION FOR EACH NATURAL GAS DISTRIBUTION COMPANY IN THE 24 COMPANY'S MOST RECENT BASE RATE PROCEEDING. 25 (F) STATE TAX ADJUSTMENT SURCHARGE.--THE NATURAL GAS 26 DISTRIBUTION COMPANY SHALL REMAIN SUBJECT TO THE STATE TAX 27 ADJUSTMENT SURCHARGE AND SHALL BE PERMITTED TO ADJUST ITS STATE 28 TAX ADJUSTMENT SURCHARGE MECHANISM TO REFLECT STATE TAX CHANGES 29 OR ADDITIONS. THE NATURAL GAS DISTRIBUTION COMPANY SHALL ALSO 30 REMAIN SUBJECT TO EXISTING RIDERS OR SURCHARGES FOR THE 19990H1331B2032 - 52 -
1 COLLECTION OF NON-GAS TRANSITION COSTS PURSUANT TO FEDERAL 2 ENERGY REGULATORY COMMISSION DECISIONS. 3 (G) PROVISIONS RELATING TO INTERSTATE PIPELINES.-- 4 (1) NOTWITHSTANDING ANY OTHER PROVISIONS OF THIS 5 CHAPTER, IF A NATURAL GAS DISTRIBUTION COMPANY'S CURRENT BASE 6 RATE REVENUES REFLECT THE MARGINS REALIZED THROUGH THE 7 UTILIZATION OF FIRM INTERSTATE PIPELINE TRANSPORTATION AND 8 STORAGE CAPACITY TO SERVE THE INTERRUPTIBLE MARKET WHEN SUCH 9 CAPACITY IS NOT NEEDED TO MAKE FIRM RETAIL DELIVERIES, THEN 10 THE NATURAL GAS DISTRIBUTION COMPANY SHALL BE PERMITTED TO 11 INCREASE BASE RATES AND, AT THE SAME TIME, REDUCE PURCHASED 12 GAS COST RATES, AS DESCRIBED IN THIS CHAPTER. 13 (2) THE UTILITY MAY PROPOSE SUCH A CHANGE IN TREATMENT, 14 CONSISTENT WITH THE FOLLOWING REQUIREMENTS: 15 (I) BASE RATES OF CUSTOMERS WHO PAY PURCHASED GAS 16 COST RATES PURSUANT TO SECTION 1307(F) (RELATING TO 17 SLIDING SCALE OF RATES; ADJUSTMENTS) SHALL BE INCREASED 18 BY AN AMOUNT EQUAL TO THE MARGIN RECEIVED FOR SERVICE 19 PROVIDED TO EXISTING INTERRUPTIBLE SALES AND 20 TRANSPORTATION SERVICE CUSTOMERS USING CAPACITY REFLECTED 21 IN RATES ESTABLISHED UNDER SECTION 1307(F) BASED UPON THE 22 REVENUE FOR SUCH SERVICES FOR THE MOST RECENT 12-MONTH 23 PERIOD IMMEDIATELY PRECEDING THE APPLICATION. 24 (II) PURCHASED GAS COST RATES ESTABLISHED PURSUANT 25 TO SECTION 1307(F) SHALL BE DECREASED BY AN AMOUNT EQUAL 26 TO THE AMOUNT BY WHICH BASE RATES ARE INCREASED IN 27 SUBPARAGRAPH (I). 28 (III) PURCHASED GAS COST RATES ESTABLISHED PURSUANT 29 TO SECTION 1307(F)SHALL THEREAFTER BE RECONCILED TO 30 REFLECT THE MARGINS REALIZED FROM INTERRUPTIBLE SALES AND 19990H1331B2032 - 53 -
1 INTERRUPTIBLE TRANSPORTATION CUSTOMERS UTILIZING CAPACITY 2 REFLECTED IN RATES ESTABLISHED UNDER SECTION 1307(F). 3 (H) INTERSTATE PIPELINE TRANSPORTATION.-- 4 (1) EXCEPT AS SPECIFICALLY SET FORTH IN THIS SUBSECTION, 5 NOTHING IN THIS SECTION OR SECTION 2204(D) (RELATING TO 6 IMPLEMENTATION) SHALL PREVENT A NATURAL GAS DISTRIBUTION 7 COMPANY FROM RECOVERING COSTS PAID UNDER THE TERMS OF 8 INTERSTATE PIPELINE TRANSPORTATION AND STORAGE CAPACITY 9 CONTRACTS WHICH ARE NOT FULLY RECOVERED THROUGH A RELEASE, 10 ASSIGNMENT OR TRANSFER OF SUCH CAPACITY TO ANOTHER NATURAL 11 GAS SUPPLIER IF SUCH UNRECOVERED COSTS ARISE UNDER THE TERMS 12 OF A NATURAL GAS TRANSPORTATION PILOT PROGRAM APPROVED BY THE 13 COMMISSION FOR SUCH COMPANY ON OR BEFORE FEBRUARY 1, 1999. 14 (2) SUCH UNRECOVERED INTERSTATE PIPELINE TRANSPORTATION 15 AND CAPACITY COSTS INCURRED UNDER SUCH PROGRAMS THROUGH 16 OCTOBER 31, 2004, MAY BE RECOVERED FROM A CLASS OR CLASSES OF 17 CUSTOMERS IN ACCORDANCE WITH SUCH PROGRAM PROVIDED THAT THE 18 TOTAL VOLUMETRIC CHARGE FOR SUCH COSTS DOES NOT EXCEED ONE 19 PERCENT OF THE VOLUMETRIC CHARGE FOR RESIDENTIAL NATURAL GAS 20 SALES SERVICE SET FORTH IN THE NATURAL GAS DISTRIBUTION 21 COMPANY'S TARIFF IN EFFECT AT THE TIME. 22 (3) WITH RESPECT TO SUCH PILOT PROGRAMS, THE COMMISSION 23 MAY DETERMINE TO EXTEND SUCH PROGRAMS TO INCLUDE ALL 24 CUSTOMERS OF THAT COMPANY PURSUANT TO THE REQUIREMENTS OF 25 THIS CHAPTER, AND NOTHING IN THIS SECTION OR SECTION 2204(D) 26 SHALL PREVENT UNRECOVERED INTERSTATE PIPELINE AND 27 TRANSPORTATION CAPACITY COSTS INCURRED THROUGH OCTOBER 31, 28 2004, UNDER SUCH PROGRAMS FROM BEING RECOVERED IN ACCORDANCE 29 WITH SUCH PROGRAMS PROVIDED THAT THE TOTAL VOLUMETRIC CHARGE 30 FOR SUCH COSTS DOES NOT EXCEED THE ONE PERCENT LIMIT 19990H1331B2032 - 54 -
1 SPECIFIED IN PARAGRAPH (2) FOR PILOT PROGRAMS. 2 SECTION 4. THE PROVISIONS OF THIS ACT ARE SEVERABLE. IF ANY 3 PROVISION OF THIS ACT OR ITS APPLICATION TO ANY PERSON OR 4 CIRCUMSTANCE IS HELD INVALID, THE INVALIDITY SHALL NOT AFFECT 5 OTHER PROVISIONS OR APPLICATIONS OF THIS ACT WHICH CAN BE GIVEN 6 EFFECT WITHOUT THE INVALID PROVISION OR APPLICATION. 7 SECTION 5. THIS ACT CONSTITUTES THE LEGISLATION REFERRED TO 8 IN SECTION 33(3) OF THE ACT OF MAY 12, 1999 (P.L. , NO.4), 9 ENTITLED "AN ACT AMENDING THE ACT OF MARCH 4, 1971 (P.L.6, 10 NO.2), ENTITLED 'AN ACT RELATING TO TAX REFORM AND STATE 11 TAXATION BY CODIFYING AND ENUMERATING CERTAIN SUBJECTS OF 12 TAXATION AND IMPOSING TAXES THEREON; PROVIDING PROCEDURES FOR 13 THE PAYMENT, COLLECTION, ADMINISTRATION AND ENFORCEMENT THEREOF; 14 PROVIDING FOR TAX CREDITS IN CERTAIN CASES; CONFERRING POWERS 15 AND IMPOSING DUTIES UPON THE DEPARTMENT OF REVENUE, CERTAIN 16 EMPLOYERS, FIDUCIARIES, INDIVIDUALS, PERSONS, CORPORATIONS AND 17 OTHER ENTITIES; PRESCRIBING CRIMES, OFFENSES AND PENALTIES,' 18 REVISING AND ADOPTING SALES AND USE TAX PROVISIONS ON PROCESSING 19 EXCLUSIONS, CREDIT SALES AND BAD DEBT SALES; REVISING PERSONAL 20 INCOME TAX PROVISIONS ON SMALL CORPORATIONS; EXPANDING 21 ELIGIBILITY FOR SPECIAL POVERTY PROVISIONS; REVISING ESTIMATED 22 TAX DECLARATIONS; ELIMINATING LOTTERY FUND TRANSFERS; REVISING 23 CORPORATE NET INCOME TAX PROVISIONS ON NONPROFIT ORGANIZATIONS, 24 NET LOSS DEDUCTIONS AND APPORTIONMENT OF BUSINESS INCOME; 25 REVISING CAPITAL STOCK FRANCHISE TAX PROVISIONS TO REDUCE THE 26 RATE OF TAXATION, REDUCE THE MINIMUM TAX, AND FURTHER PROVIDE 27 FOR CAPITAL STOCK FRANCHISE TAX EXEMPTIONS, EXCLUSIONS AND 28 PROCEEDS; ELIMINATING THE UTILITIES GROSS RECEIPTS TAX ON 29 NATURAL GAS; MAKING OMNIBUS AMENDMENTS TO THE PUBLIC UTILITY 30 REALTY TAX; PROVIDING FOR A TAX CREDIT FOR COAL WASTE REMOVAL 19990H1331B2032 - 55 -
1 AND ULTRACLEAN FUELS; FURTHER PROVIDING FOR MALT BEVERAGE TAX 2 CREDITS; FURTHER PROVIDING FOR THE RATE OF TAXATION FOR THE 3 PUBLIC TRANSPORTATION ASSISTANCE FUND; FURTHER PROVIDING FOR 4 ESTIMATED TAX, FOR PAYMENT OF HARNESS AND THOROUGHBRED RACING 5 TAXES AND FOR CORPORATE TAX TREATMENT OF AUTOMOBILE CLUBS; AND 6 MAKING A REPEAL." THE SECRETARY OF REVENUE SHALL PUBLISH NOTICE 7 OF THE ENACTMENT OF THIS ACT IN THE PENNSYLVANIA BULLETIN. 8 SECTION 6. THIS ACT SHALL TAKE EFFECT AS FOLLOWS: 9 (1) THE ADDITION OF 66 PA.C.S. §§ 2004(B) AND 2203(15) 10 SHALL TAKE EFFECT MAY 1, 1999. 11 (2) THIS SECTION SHALL TAKE EFFECT IMMEDIATELY. 12 (3) THE REMAINDER OF THIS ACT SHALL TAKE EFFECT JULY 1, 13 1999, OR IMMEDIATELY, WHICHEVER OCCURS LATER. D16L66JS/19990H1331B2032 - 56 -