Regular Session 2015-2016 Senate Bill 0805 P.N. 2188

PRIOR PRINTER'S NOS. 0922, 1900

PRINTER'S NO. 2188

THE GENERAL ASSEMBLY OF PENNSYLVANIA

SENATE BILL

No.

805

Session of

2015

INTRODUCED BY BOSCOLA, MENSCH, YUDICHAK, BROWNE, ARGALL,

ALLOWAY, AUMENT, HUTCHINSON, VULAKOVICH, GORDNER AND WARD,

MAY 14, 2015

AS AMENDED ON SECOND CONSIDERATION, OCTOBER 24, 2016

AN ACT

Amending Title 66 (Public Utilities) of the Pennsylvania

Consolidated Statutes, in restructuring of electric utility

industry, further providing for energy efficiency and

conservation program.

The General Assembly of the Commonwealth of Pennsylvania

hereby enacts as follows:

Section 1. Section 2806.1(b)(1)(ii) of Title 66 of the

Pennsylvania Consolidated Statutes is amended and the section is

amended by adding a subsection to read:

§ 2806.1. Energy efficiency and conservation program.

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(b) Duties of electric distribution companies.--

(1) * * *

(ii) [A] For each plan filed for any applicable

phase of implementation of the program beginning after

May 31, 2021, a new plan shall be filed with the

commission every [five years or as otherwise required by

the commission] three years, unless a shorter duration is

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required by the commission. The plan shall set forth the

manner in which the company will meet the required

reductions in consumption under subsections (c) and (d).

* * *

(j.1) Large customer opt-out.--Any customer that is part of

the large commercial class or industrial class, as defined in

the electric distribution company's initial plan under this

section, shall have the ability to opt-out of participation in

the plan as follows:

(1) By December 31, 2016, for each plan filed for the

applicable phase of implementation of the program for the

period June 1, 2016, to May 31, 2021, or 365 days prior to

each new plan filed pursuant to subsection (b)(1)(ii) for any

applicable phase of implementation of the program beginning

after May 31, 2021 , the electric distribution company shall

provide each large commercial customer and industrial

customer with the option to forgo participation in the plan.

This option shall apply regardless of whether the customer

purchases default service or supply from an alternate

supplier. The customer may exercise this option for any or

all accounts in this Commonwealth . If one or more of the

electric distribution company's large commercial or

industrial customers opts to forgo participation in the

electric distribution company's plan filed for the applicable

phase of implementation of the program for the period June 1,

2016, to May 31, 2021, prior to December 31, 2016, the

electric distribution company may file a revised plan with

the commission to reflect the adjustments pursuant to

paragraph (4).

(2) A customer that forgoes participation in the plan

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will not be eligible to receive funding or other measures

contained in the plan for the opt-out accounts during the

applicable phase.

(3) A customer that forgoes participation in the plan

will not be required to pay the cost recovery charge under

subsection (k) for the opt-out accounts.

(4) The electric distribution company may adjust its

consumption and peak demand reduction goals, as well as its

budget, under its plan to reflect the customers that have

exercised the option to forgo participation in the plan.

(5) By December 1, 2016 , the commission shall promulgate

guidelines to administer this subsection.

* * *

Section 2. This act shall take effect in 60 days.

SECTION 1. SECTION 2806.1(A)(10), (B)(1) INTRODUCTORY

PARAGRAPH AND (I)(B) AND (I), (C)(3), (D)(2), (F)(1)(I) AND (II)

AND (2)(I) AND (II) INTRODUCTORY PARAGRAPH AND (A) AND THE

DEFINITION OF "CONSERVATION SERVICE PROVIDER" IN SUBSECTION (M)

OF TITLE 66 OF THE PENNSYLVANIA CONSOLIDATED STATUTES ARE

AMENDED, SUBSECTION (M) IS AMENDED BY ADDING A DEFINITION AND

THE SECTION IS AMENDED BY ADDING SUBSECTIONS TO READ:

§ 2806.1. ENERGY EFFICIENCY AND CONSERVATION PROGRAM.

(A) PROGRAM.--THE COMMISSION SHALL, BY JANUARY 15, 2009,

ADOPT AN ENERGY EFFICIENCY AND CONSERVATION PROGRAM TO REQUIRE

ELECTRIC DISTRIBUTION COMPANIES TO ADOPT AND IMPLEMENT COST-

EFFECTIVE ENERGY EFFICIENCY AND CONSERVATION PLANS TO REDUCE

ENERGY DEMAND AND CONSUMPTION WITHIN THE SERVICE TERRITORY OF

EACH ELECTRIC DISTRIBUTION COMPANY IN THIS COMMONWEALTH. THE

PROGRAM SHALL INCLUDE:

* * *

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(10) A REQUIREMENT FOR THE [PARTICIPATION] UTILIZATION

OF CONSERVATION SERVICE PROVIDERS [IN] TO FACILITATE THE

IMPLEMENTATION OF ALL OR PART OF A PLAN.

* * *

(B) DUTIES OF ELECTRIC DISTRIBUTION COMPANIES.--

(1) THE FOLLOWING APPLY:

(I) BY JULY 1, 2009, EACH ELECTRIC DISTRIBUTION

COMPANY SHALL DEVELOP AND FILE AN ENERGY EFFICIENCY AND

CONSERVATION PLAN WITH THE COMMISSION FOR APPROVAL TO

MEET THE REQUIREMENTS OF SUBSECTION (A) AND THE

REQUIREMENTS FOR REDUCTION IN CONSUMPTION UNDER

SUBSECTIONS (C) AND (D). THE PLAN SHALL BE IMPLEMENTED

UPON APPROVAL BY THE COMMISSION. THE FOLLOWING ARE THE

PLAN REQUIREMENTS:

* * *

[(B) A MINIMUM OF 10% OF THE REQUIRED REDUCTIONS

IN CONSUMPTION UNDER SUBSECTIONS (C) AND (D) SHALL BE

OBTAINED FROM UNITS OF FEDERAL, STATE AND LOCAL

GOVERNMENT, INCLUDING MUNICIPALITIES, SCHOOL

DISTRICTS, INSTITUTIONS OF HIGHER EDUCATION AND

NONPROFIT ENTITIES.]

* * *

(I) THE ELECTRIC DISTRIBUTION COMPANY SHALL

DEMONSTRATE THAT THE PLAN IS COST EFFECTIVE USING A

TOTAL RESOURCE COST TEST APPROVED BY THE COMMISSION

AND PROVIDES A DIVERSE CROSS SECTION OF ALTERNATIVES

FOR PARTICIPATING CUSTOMERS OF [ALL] RATE CLASSES

INCLUDED IN THE PLAN.

* * *

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SUBSECTION (B) SHALL REDUCE ELECTRIC CONSUMPTION AS FOLLOWS:

* * *

(3) BY NOVEMBER 30, 2013, [AND EVERY FIVE YEARS

THEREAFTER,] THE COMMISSION SHALL EVALUATE THE COSTS AND

BENEFITS OF THE PROGRAM ESTABLISHED UNDER SUBSECTION (A) AND

OF APPROVED ENERGY EFFICIENCY AND CONSERVATION PLANS

SUBMITTED TO THE PROGRAM. THE EVALUATION SHALL BE CONSISTENT

WITH A TOTAL RESOURCE COST TEST OR A COST-BENEFIT ANALYSIS

DETERMINED BY THE COMMISSION. IF THE COMMISSION DETERMINES

THAT THE BENEFITS OF THE PROGRAM EXCEED THE COSTS, THE

COMMISSION SHALL ADOPT ADDITIONAL REQUIRED INCREMENTAL

REDUCTIONS IN CONSUMPTION. FOLLOWING MAY 31, 2021, THE TERM

OF A PLAN SHALL BE DETERMINED BY THE COMMISSION BUT SHALL NOT

EXCEED FIVE YEARS.

(C.1) OPTION.--

(1) PRIOR TO EACH PHASE OF IMPLEMENTATION OF THE PROGRAM

BEGINNING AFTER MAY 31, 2021, BY A DATE DETERMINED BY THE

COMMISSION, A CUSTOMER THAT IS A MEMBER OF A LARGE COMMERCIAL

CLASS OR INDUSTRIAL CLASS MAY OPT TO CEASE PARTICIPATION IN

THE ELECTRIC DISTRIBUTION COMPANY PLAN FOR ALL OF THE

CUSTOMER'S ELIGIBLE ACCOUNTS. A CUSTOMER THAT OPTS TO CEASE

PARTICIPATION IN A PLAN UNDER THIS PARAGRAPH SHALL REMAIN

OPTED OUT OF THE ELECTRIC DISTRIBUTION COMPANY PLAN FOR ALL

SUBSEQUENT PHASES OF IMPLEMENTATION OF THE PROGRAM UNLESS AND

UNTIL THE CUSTOMER, BY A DATE DETERMINED BY THE COMMISSION

PRIOR TO IMPLEMENTATION OF A SUBSEQUENT PHASE, OPTS TO RESUME

PARTICIPATION IN THE ELECTRIC DISTRIBUTION COMPANY PLAN.

(2) A CUSTOMER THAT OPTS OUT OF A PLAN UNDER PARAGRAPH

(1):

(I) SHALL NOT BE ELIGIBLE TO RECEIVE GRANTS, REBATES

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OR OTHER FUNDING CONTAINED IN THE PLAN FOR THE OPT-OUT

ACCOUNTS DURING THE APPLICABLE PHASE; AND

(II) SHALL NOT BE REQUIRED TO PAY A RECOVERY UNDER

SUBSECTION (K) FOR THE OPT-OUT ACCOUNTS DURING THE

APPLICABLE PHASE.

(3) BY DECEMBER 31, 2017, THE COMMISSION SHALL ESTABLISH

GUIDELINES TO IMPLEMENT THIS SUBSECTION.

(C.2) REFUND.--ANY OVER COLLECTIONS OR UNDER COLLECTIONS

FROM ANY CUSTOMER CLASSES SHALL BE REFUNDED OR RECOVERED, AS

APPROPRIATE IN ACCORDANCE WITH THE COMMISSION'S IMPLEMENTATION

ORDER FOR THE SUBSEQUENT PHASE.

(D) PEAK DEMAND.--THE PLANS ADOPTED UNDER SUBSECTION (B)

SHALL REDUCE ELECTRIC DEMAND AS FOLLOWS:

* * *

(2) [BY NOVEMBER 30, 2013, THE COMMISSION SHALL COMPARE

THE TOTAL COSTS OF ENERGY EFFICIENCY AND CONSERVATION PLANS

IMPLEMENTED UNDER THIS SECTION TO THE TOTAL SAVINGS IN ENERGY

AND CAPACITY COSTS TO RETAIL CUSTOMERS IN THIS COMMONWEALTH

OR OTHER COSTS DETERMINED BY THE COMMISSION. IF THE

COMMISSION DETERMINES THAT THE BENEFITS OF THE PLANS EXCEED

THE COSTS, THE COMMISSION SHALL SET ADDITIONAL INCREMENTAL

REQUIREMENTS FOR REDUCTION IN PEAK DEMAND FOR THE 100 HOURS

OF GREATEST DEMAND OR AN ALTERNATIVE REDUCTION APPROVED BY

THE COMMISSION. REDUCTIONS IN DEMAND SHALL BE MEASURED FROM

THE ELECTRIC DISTRIBUTION COMPANY'S PEAK DEMAND FOR THE

PERIOD FROM JUNE 1, 2011, THROUGH MAY 31, 2012. THE

REDUCTIONS IN CONSUMPTION REQUIRED BY THE COMMISSION SHALL BE

ACCOMPLISHED NO LATER THAN MAY 31, 2017.] THE COMMISSION

SHALL NOT MANDATE ANY PEAK DEMAND REDUCTIONS IN ANY NEW PLAN

IMPLEMENTED AFTER MAY 31, 2021.

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* * *

(F) PENALTIES.--

(1) THE FOLLOWING SHALL APPLY FOR FAILURE TO SUBMIT A

PLAN:

(I) AN ELECTRIC DISTRIBUTION COMPANY THAT FAILS TO

FILE A PLAN UNDER SUBSECTION (B) OR (C.1)(2) SHALL BE

SUBJECT TO A CIVIL PENALTY OF NOT MORE THAN $100,000 PER

DAY UNTIL THE PLAN IS FILED.

(II) AN ELECTRIC DISTRIBUTION COMPANY THAT FAILS TO

FILE A REVISED PLAN UNDER SUBSECTION (E)(2)(II) SHALL BE

SUBJECT TO A CIVIL PENALTY OF NOT MORE THAN $100,000 PER

DAY UNTIL THE PLAN IS FILED.

* * *

(2) THE FOLLOWING SHALL APPLY TO AN ELECTRIC

DISTRIBUTION COMPANY THAT FAILS TO ACHIEVE THE REDUCTIONS IN

CONSUMPTION REQUIRED [UNDER SUBSECTION (C) OR (D)] BY THE

COMMISSION UNDER SUBSECTION (C):

(I) THE ELECTRIC DISTRIBUTION COMPANY SHALL BE

SUBJECT TO A CIVIL PENALTY [NOT LESS THAN $1,000,000 AND]

NOT TO EXCEED [$20,000,000] $5,000,000 FOR FAILURE TO

ACHIEVE THE [REQUIRED] REDUCTIONS IN CONSUMPTION [UNDER

SUBSECTION (C) OR (D)] REQUIRED BY THE COMMISSION UNDER

SUBSECTION (C). ANY PENALTY PAID BY AN ELECTRIC

DISTRIBUTION COMPANY UNDER THIS SUBPARAGRAPH SHALL NOT BE

RECOVERABLE FROM RATEPAYERS.

(II) IF AN ELECTRIC DISTRIBUTION COMPANY FAILS TO

ACHIEVE THE [REQUIRED] REDUCTIONS IN CONSUMPTION [UNDER

SUBSECTION (C) OR (D)] REQUIRED BY THE COMMISSION UNDER

SUBSECTION (C), RESPONSIBILITY TO ACHIEVE THE REDUCTIONS

IN CONSUMPTION SHALL BE TRANSFERRED TO THE COMMISSION.

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THE COMMISSION SHALL DO ALL OF THE FOLLOWING:

(A) IMPLEMENT A PLAN TO ACHIEVE THE [REQUIRED]

REDUCTIONS IN CONSUMPTION [UNDER SUBSECTION (C) OR

(D)] REQUIRED BY THE COMMISSION UNDER SUBSECTION (C).

* * *

(M) DEFINITIONS.--AS USED IN THIS SECTION, THE FOLLOWING

WORDS AND PHRASES SHALL HAVE THE MEANINGS GIVEN TO THEM IN THIS

SUBSECTION:

"CONSERVATION SERVICE PROVIDER." AN ENTITY THAT PROVIDES

INFORMATION AND TECHNICAL ASSISTANCE ON MEASURES TO ENABLE A

PERSON TO INCREASE ENERGY EFFICIENCY OR REDUCE ENERGY

CONSUMPTION [AND THAT HAS NO DIRECT OR INDIRECT OWNERSHIP,

PARTNERSHIP OR OTHER AFFILIATED INTEREST WITH AN ELECTRIC

DISTRIBUTION COMPANY].

* * *

"LARGE COMMERCIAL CLASS OR INDUSTRIAL CLASS." THE GROUP OF

CUSTOMERS CATEGORIZED AS LARGE COMMERCIAL OR AS INDUSTRIAL BY AN

ELECTRIC DISTRIBUTION COMPANY IN ITS ORIGINAL ENERGY EFFICIENCY

AND CONSERVATION PLAN UNDER SUBSECTION (B)(1)(I) OR AS FILED IN

THE COMPANY'S TARIFF.

* * *

SECTION 2. THIS ACT SHALL TAKE EFFECT IN 60 DAYS.

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