PRIOR PRINTER'S NOS. 3089, 3176 PRINTER'S NO. 3218
No. 2200 Session of 2008
INTRODUCED BY GEORGE, McCALL, BELFANTI, CALTAGIRONE, CONKLIN, DALEY, GOODMAN, HARHAI, HARKINS, KULA, MANDERINO, McGEEHAN, VITALI, J. WHITE, WALKO, SURRA, DeLUCA, DERMODY, GRUCELA, JOSEPHS, JAMES, GINGRICH, FREEMAN, K. SMITH, McILVAINE SMITH, YOUNGBLOOD AND FRANKEL, JANUARY 15, 2008
AS AMENDED ON SECOND CONSIDERATION, HOUSE OF REPRESENTATIVES, FEBRUARY 11, 2008
AN ACT 1 Amending Title 66 (Public Utilities) of the Pennsylvania 2 Consolidated Statutes, PROVIDING FOR RECOVERY OF CERTAIN <-- 3 LABOR RELATIONS EXPENSES; further providing for definitions; 4 and providing for adoption of energy efficiency and demand- <-- 5 side response; AND FURTHER PROVIDING FOR DUTIES OF ELECTRIC <-- 6 DISTRIBUTION COMPANIES. 7 The General Assembly of the Commonwealth of Pennsylvania 8 hereby enacts as follows: 9 Section 1. Section 2803 of Title 66 of the Pennsylvania <-- 10 Consolidated Statutes is amended by adding definitions to read: 11 SECTION 1. TITLE 66 OF THE PENNSYLVANIA CONSOLIDATED <-- 12 STATUTES IS AMENDED BY ADDING A SECTION TO READ: 13 § 1329. RECOVERY OF CERTAIN LABOR RELATIONS EXPENSES. 14 NO PUBLIC UTILITY MAY CHARGE ITS CUSTOMERS AS A PERMISSIBLE 15 OPERATING EXPENSE FOR RATEMAKING PURPOSES ANY PORTION OF THE 16 DIRECT OR INDIRECT COST OF MEETINGS, PUBLICATIONS, CONSULTANTS, 17 ATTORNEYS OR OTHER PROFESSIONAL SERVICES AND EXPENSES ASSOCIATED 18 WITH THE UTILITY'S EFFORTS TO DISSUADE THE EMPLOYEES OF THE
1 UTILITY, OR THE EMPLOYEES OF ANY AFFILIATED INTEREST OF THE 2 UTILITY AS DEFINED IN SECTION 2101 (RELATING TO DEFINITION OF 3 AFFILIATED INTEREST), FROM BECOMING OR REMAINING A MEMBER IN, OR 4 OTHERWISE BEING REPRESENTED BY, ANY LABOR UNION. 5 SECTION 2. SECTION 2803 OF TITLE 66 IS AMENDED BY ADDING 6 DEFINITIONS TO READ: 7 § 2803. Definitions. 8 The following words and phrases when used in this chapter 9 shall have the meanings given to them in this section unless the 10 context clearly indicates otherwise: 11 "Affiliated interest." As defined in section 2101 (relating 12 to definition of affiliated interest). 13 * * * 14 "Cost effective." In relation to a program being evaluated, 15 satisfaction of the total resource cost test. 16 * * * 17 "Demand-side response." Load management technologies, 18 management practices or other strategies employed by retail 19 customers that decrease peak electricity demand or shift demand 20 from on-peak to off-peak periods provided that: 21 (1) The measure is installed on or after the effective 22 date of this section at the service location of a retail 23 customer. 24 (2) The measure reduces the peak demand or cost of 25 energy by the retail customer. 26 (3) The costs of the acquisition or installation of the 27 measure are directly incurred in whole or in part by the 28 electric distribution company. 29 * * * 30 "Energy efficiency." Technologies, management practices or 20080H2200B3218 - 2 -
1 other strategies or measures employed by retail customers that 2 reduce electricity consumption provided that: 3 (1) The measure is installed on or after the effective 4 date of this definition at the service location of a retail 5 customer. 6 (2) The measure reduces the consumption of energy by the 7 retail customer. 8 (3) The costs of the acquisition or installation of the 9 measure are directly incurred in whole or in part by the 10 electric distribution company. 11 "Independent entity." An entity with no direct or indirect 12 ownership, partnership or other affiliated interest with an 13 electric distribution company. 14 "Peak demand." The highest electrical requirement occurring 15 during a specified period. For an electric distribution company, 16 the term means the sum of the metered consumption for all retail 17 customers over that period. 18 * * * <-- 19 "REAL-TIME PRICE." A RATE THAT DIRECTLY REFLECTS THE <-- 20 DIFFERENT COST OF ENERGY DURING EACH HOUR. 21 * * * 22 "SMART METER TECHNOLOGY." TECHNOLOGY, INCLUDING, BUT NOT 23 LIMITED TO, METERING TECHNOLOGY AND NETWORK COMMUNICATIONS 24 TECHNOLOGY CAPABLE OF BIDIRECTIONAL COMMUNICATION AND THAT 25 RECORDS ELECTRICITY USAGE ON AT LEAST AN HOURLY BASIS, INCLUDING 26 RELATED ELECTRIC DISTRIBUTION SYSTEM UPGRADES TO ENABLE THE 27 TECHNOLOGY. THE TECHNOLOGY SHALL PROVIDE CUSTOMERS WITH DIRECT 28 ACCESS TO AND USE OF PRICE AND CONSUMPTION INFORMATION. THE 29 TECHNOLOGY SHALL ALSO: 30 (1) DIRECTLY PROVIDE CUSTOMERS WITH INFORMATION ON THEIR 20080H2200B3218 - 3 -
1 HOURLY CONSUMPTION. 2 (2) ENABLE TIME-OF-USE RATES AND REAL-TIME PRICE 3 PROGRAMS. 4 (3) EFFECTIVELY SUPPORT THE AUTOMATIC CONTROL OF THE 5 CUSTOMER'S ELECTRICITY CONSUMPTION BY ONE OR MORE OF THE 6 FOLLOWING AS SELECTED BY THE CUSTOMER: 7 (I) THE CUSTOMER; 8 (II) THE CUSTOMER'S UTILITY; OR 9 (III) A THIRD PARTY ENGAGED BY THE CUSTOMER OR THE 10 CUSTOMER'S UTILITY. 11 "TIME-OF-USE RATE." A RATE THAT REFLECTS THE COSTS OF 12 SERVING CUSTOMERS DURING DIFFERENT TIME PERIODS, INCLUDING OFF- 13 PEAK AND ON-PEAK PERIODS, BUT NOT AS FREQUENTLY AS EACH HOUR. 14 "Total resources cost test." A standard test that is met if, 15 over the effective life of the program, the avoided supply-side 16 monetary costs are greater than the monetary costs of the 17 demand-side programs borne by both the electric distribution 18 company and the participants. 19 * * * 20 Section 2 3. Title 66 is amended by adding a section to <-- 21 read: 22 § 2806.1. Adoption of procedures encouraging energy efficiency 23 and demand-side response. 24 (a) Program.--The commission shall develop a program to 25 provide for the implementation of cost-effective programs that 26 reduce energy demand and consumption within the service 27 territories of all electric distribution companies throughout 28 this Commonwealth. The program shall include, but is not limited 29 to, the following: 30 (1) Selecting a program administrator to develop and 20080H2200B3218 - 4 -
1 oversee the delivery of energy efficiency and demand-side 2 response programs within the service territory of each 3 electric distribution company within this Commonwealth. 4 (2) Implementing the necessary administrative and 5 financial mechanisms that will enable the program 6 administrator to develop and oversee the provision of energy 7 efficiency and demand-side response programs within the 8 service territory of each electric distribution company 9 within this Commonwealth, including the levying of 10 assessments in accordance with sections 510 (relating to 11 assessment for regulatory expenses upon public utilities), 12 1307 (relating to sliding scale of rates; adjustments) and 13 1308 (relating to voluntary changes in rates). The commission 14 shall not approve or implement and shall not assess or charge 15 to customers the costs of energy efficiency or demand- 16 response programs to the extent that the costs of such 17 programs exceed 2% of the total annual revenues of the 18 electric distribution company in whose service territory the <-- 19 programs are implemented. FROM ALL SOURCES, INCLUDING DEFAULT <-- 20 SERVICE GENERATION REVENUES AS OF JANUARY 1, 2007. This 21 funding limit shall not include amounts provided for by the 22 low-income usage reduction programs established under 23 regulations at 52 Pa. Code Ch. 58 (relating to residential 24 low income usage reduction programs). 25 (3) Implementing the necessary administrative and 26 financial mechanisms that facilitate a system of third-party 27 entities to deliver all or portions of the energy efficiency 28 and demand-side response programs within the service 29 territory of each electric distribution company within this 30 Commonwealth, including the levying of assessments in 20080H2200B3218 - 5 -
1 accordance with sections 510, 1307 and 1308. The commission 2 may order the electric distribution company to pay the third- 3 party entity for services rendered in an electric 4 distribution company's respective service territory pursuant 5 to this section. The electric distribution company may be a 6 third-party entity. 7 (b) Selection of program administrator.--The commission 8 shall implement the following procedures when selecting a 9 program administrator: 10 (1) The commission shall prepare a request for proposals 11 for a program administrator to provide for the development 12 and delivery of the energy efficiency and demand-side 13 response programs in the service territories of all electric 14 distribution companies and shall make the request for 15 proposals available for public comment. 16 (2) The commission shall, within 60 days of the 17 completion of the public comment period, issue the final 18 request for proposals. 19 (3) The commission shall, based on a competitive bid 20 process, select an independent entity to serve as the energy 21 efficiency and demand-side response program administrator. 22 (4) The commission shall include as a part of its 23 agreement with the program administrator a system of 24 performance parameters and a financial mechanism that 25 provides incentives for exceeding established performance 26 parameters and penalties for third parties not meeting 27 established performance parameters. 28 (c) Powers and duties of program administrator.--The program 29 administrator shall have powers and duties assigned by the 30 commission. The powers and duties shall include, but not be 20080H2200B3218 - 6 -
1 limited to: 2 (1) Soliciting through a competitive procurement process 3 within each electric distribution company service territory a 4 program of providing energy efficiency and demand-side 5 response programs to residential, commercial and industrial 6 customers utilizing third-party entities. 7 (2) Ensuring that each proposal includes, but is not 8 limited to: 9 (i) A clear delineation of how the program will be 10 conducted. 11 (ii) The types of specific program measures to be 12 offered. 13 (iii) The cost and benefit of each program to be 14 offered. 15 (iv) A process for monitoring and verifying results, 16 data collection and management procedures, program 17 evaluation processes and financial management strategies. 18 (3) In its review of each proposal received: 19 (i) Taking into account the unique circumstances of 20 each electric distribution company's service territory. 21 (ii) Finding that each program is cost effective and 22 that the portfolio of programs is designed to provide 23 every affected customer class with the opportunity to 24 participate and benefit economically. 25 (iii) Determining the cost-effectiveness of energy 26 efficiency and demand-side response measures using the 27 total resource cost test. 28 (4) Recommending to the commission those entities best 29 suited to provide energy efficiency and demand-side response 30 programs within the service territory of each electric 20080H2200B3218 - 7 -
1 distribution company. 2 (5) In the event no qualified proposals are received 3 that meet the required plan goals in an electric distribution 4 company service territory to conduct the program activities: 5 (i) Issuing a subsequent request for proposals with 6 plan goals that are reduced no more than necessary to 7 obtain qualified proposals to provide program activities. 8 The lowered plan goals for energy efficiency and demand- 9 side response shall only be in effect for that year. 10 (ii) In subsequent years, utilizing the plan goals 11 unless no qualified proposals are received to conduct the 12 program activities that meet the plan goals, the program 13 administrator shall issue a subsequent request for 14 proposals in accordance with the procedures identified in 15 this subparagraph. 16 (6) Executing agreements on behalf of the commission 17 with the selected entity in each electric distribution 18 company service territory to conduct the energy efficiency 19 and demand-side response program. As part of these agreements 20 the program administrator shall ensure that: 21 (i) The programs offered by the selected entity are 22 provided equitably across all customer classes. 23 (ii) A clearly defined process for financial 24 compensation for the entity delivering the program which 25 is tied to defined goals for performance regarding 26 program activities accomplished, energy cost savings on a 27 per-customer basis and utility-wide basis and overall 28 energy and peak demand reduction is established. 29 (iii) A system of incentives and penalties for 30 performance of contractual activities above and below 20080H2200B3218 - 8 -
1 predetermined levels is in place. 2 (iv) There is a set contract term which may include 3 an initial three-year term with renewal terms of varied 4 length. 5 (7) Submitting reports to the commission at such times 6 and in such manner as the commission directs. 7 (d) Commission review of recommendations.--The commission 8 shall review the recommendations made by the program 9 administrator regarding those entities best suited to provide 10 energy efficiency and demand-side response programs within the 11 service territory of each electric distribution company. The 12 commission shall approve or disapprove the recommendations made 13 by the program administrator. 14 (1) The commission review of the recommendations of the 15 program administrator shall be limited to ensuring that: 16 (i) There is no evidence of fraud or market abuse. 17 (ii) Any costs entered into are borne by the 18 appropriate parties and that costs, including the costs 19 of subsection (c)(6)(iv) incentives, related to the 20 provision of the contracted services are borne by the 21 appropriate customer class. 22 (iii) There will be provided, in a cost-effective 23 manner, a program that provides energy efficiency and 24 demand-side response measures to all customer classes 25 throughout the service territory of each electric 26 distribution company. 27 (2) If the commission approves a third-party entity to 28 conduct the program, the commission shall ensure the program 29 administrator finalizes the agreement between the commission 30 and the third-party entity selected to provide the program of 20080H2200B3218 - 9 -
1 energy efficiency and demand-side response. 2 (3) In the event the commission disapproves the 3 recommendation of the program administrator, the commission 4 shall provide a rationale for this decision and direct the 5 program administrator on a course of action. 6 (e) Plan goals.--The program administrator shall ensure that 7 each proposal submitted by a third-party entity to deliver a 8 program of energy efficiency and demand-side response measures 9 includes meeting the following energy saving goals: 10 (1) The following relate to energy efficiency goals: 11 (I) BY MAY 31, 2011, TOTAL ANNUAL DELIVERIES TO <-- 12 RETAIL CUSTOMERS OF ELECTRIC DISTRIBUTION COMPANIES SHALL 13 BE REDUCED BY A MINIMUM OF 1%. THIS LOAD REDUCTION SHALL 14 BE MEASURED AGAINST THE EXPECTED LOAD FORECASTED BY THE 15 COMMISSION FOR JUNE 1, 2010, THROUGH MAY 31, 2011, BASED 16 ON LOAD FOR THE PERIOD JUNE 1, 2007, THROUGH MAY 31, 17 2008, WITH PROVISION MADE FOR WEATHER ADJUSTMENTS AND 18 EXTRAORDINARY LOAD THAT THE ELECTRIC DISTRIBUTION COMPANY 19 MUST SERVE. THE COMMISSION SHALL DETERMINE AND MAKE 20 PUBLIC THE FORECASTS TO BE USED FOR EACH ELECTRIC 21 DISTRIBUTION COMPANY NO LATER THAN AUGUST 31, 2008. THE 22 PROGRAM ADMINISTRATOR SHALL ENSURE THAT A THIRD-PARTY 23 ENTITY MEETS THE GOALS CONTAINED IN THIS SECTION THROUGH 24 THE IMPLEMENTATION OF A PROGRAM OF ENERGY EFFICIENCY 25 MEASURES THROUGHOUT THE SERVICE TERRITORY OF THE ELECTRIC 26 DISTRIBUTION COMPANY. 27 (i) (II) By May 31, 2013, total annual deliveries to <-- 28 retail customers of electric distribution companies shall 29 be reduced by a minimum of 2.5%. , with provision made <-- 30 for weather adjustments and extraordinary load that the 20080H2200B3218 - 10 -
1 electric distribution company must serve. This load 2 reduction shall be measured against the expected load 3 forecasted by the commission for June 1, 2012, through 4 May 31, 2013, based on load for the period June 1, 2007, 5 through May 31, 2008, WITH PROVISION MADE FOR WEATHER <-- 6 ADJUSTMENTS AND EXTRAORDINARY LOAD THAT THE ELECTRIC 7 DISTRIBUTION COMPANY MUST SERVE. The commission shall 8 determine and make public the forecasts to be used for 9 each electric distribution company no later than August 10 31, 2008. The program administrator shall ensure that a 11 third-party entity meets the goals contained in this 12 section through the implementation of a program of energy 13 efficiency measures throughout the service territory of 14 the electric distribution company. 15 (ii) (III) By November 30, 2013, the program <-- 16 administrator shall evaluate the costs and benefits of 17 these energy efficiency and conservation programs. If the 18 benefits have been shown to exceed the costs, consistent 19 with the total resource cost test, the program 20 administrator, in consultation with the commission, shall 21 set additional, incremental energy efficiency and 22 conservation goals for the period ending May 31, 2018. 23 (iii) (IV) After May 31, 2018, the program <-- 24 administrator shall continue to evaluate the costs and 25 benefits of efficiency and conservation measures and, in 26 consultation with the commission, may adopt additional 27 incremental load reduction standards for electric 28 distribution companies. 29 (2) The following relate to demand-side response 30 measures: 20080H2200B3218 - 11 -
1 (i) Cost-effective demand-side response measures to 2 reduce peak demand by a minimum of 4% in the 100 hours of 3 highest demand with provision made for weather 4 adjustments and extraordinary load that the electric 5 distribution company must serve shall be implemented in 6 each electric distribution company's service territory. 7 This reduction will be measured against the electric 8 distribution company's peak demand in the 100 hours of 9 greatest demand for June 1, 2007, through May 31, 2008. 10 The reductions shall be accomplished by May 31, 2012. 11 (ii) By November 30, 2012, the program administrator 12 shall compare the total costs of these demand-side 13 response measures to the total savings in energy and 14 capacity costs to retail customers of this Commonwealth. 15 If the benefits have been shown to exceed the costs, 16 consistent with the total resource cost test, the 17 commission shall order additional peak demand reductions 18 for the 100 hours of greatest demand or an alternative 19 measure adopted by the commission. The reductions shall 20 be measured from the electric distribution company's peak 21 demand for the period from June 1, 2011, through May 31, 22 2012. The mandated reductions shall be accomplished no 23 later than May 31, 2017. 24 (iii) After May 31, 2017, the program administrator 25 shall continue to evaluate the costs and benefits of 26 demand-side response measures and may, in consultation 27 with the commission, adopt additional incremental peak 28 load reduction standards. 29 (f) Measurements and verification.--The commission shall 30 establish standards by which the program administrator submits 20080H2200B3218 - 12 -
1 to the commission an annual report, which includes that 2 information relating to the actions and results of the energy 3 efficiency and demand-side response programs undertaken within 4 each electric distribution service territory by each third-party 5 entity. 6 (1) The report shall include, but not be limited to: 7 (i) Documentation of program expenditures. 8 (ii) Measurement and verification of savings 9 resulting from programs. 10 (iii) Evaluation of the cost-effectiveness of 11 expenditures. 12 (iv) Any other information the commission may 13 require pursuant to its rulemaking authority. 14 (2) The program administrator, upon consultation with 15 the commission, shall direct a third-party entity to modify 16 or terminate a particular energy efficiency or a demand-side 17 response program if, after an adequate period for 18 implementation of the program, the commission determines the 19 program is not sufficiently meeting its goals and purposes. 20 (3) In the event an energy efficiency or demand-side 21 response program is terminated, the program administrator 22 shall require the third-party entity to submit a revised 23 program describing the actions to be undertaken to either 24 offer a substitute program or increase the availability of 25 existing programs to make up for the effect of the terminated 26 program on its overall program goals. 27 (g) Responsibilities of electric distribution companies.-- 28 Each electric distribution company that does not seek to be a 29 third-party entity shall: 30 (1) Cooperate with the program administrator as needed 20080H2200B3218 - 13 -
1 in its efforts to competitively procure the services of a 2 third-party entity to provide an energy efficiency and 3 demand-side response program within the service territory of 4 the electric distribution company. 5 (2) Provide information necessary to effectively 6 facilitate the work of the selected third-party entity in 7 conducting the energy efficiency and demand-side response 8 program. 9 (3) Provide assistance as may be requested by the 10 program administrator in reviewing proposals from third-party 11 entities seeking to provide energy efficiency and demand-side 12 response programs within their service territories. 13 (4) Provide assistance as may be requested by the 14 program administrator to facilitate the successful execution 15 of the contract agreement with the third-party entities to 16 provide an energy efficiency and demand-side response program 17 within their service territories. 18 (h) Recovery of administrative and program costs.--An 19 electric distribution company may fully recover all 20 administrative costs, including, but not limited to, costs 21 incurred under subsections (a)(3) and (g)(1), (2), (3) and (4), 22 that the commission determines are prudently incurred and 23 reasonable in amount pursuant to implementing a program to 24 deliver cost-effective energy efficiency and demand-side 25 response activities through a third-party entity. Program and 26 administrative costs shall be recovered on a full and current 27 basis by the electric distribution company from customers 28 through a reconcilable automatic adjustment clause pursuant to 29 section 1307. Energy efficiency and demand-side resource 30 programs shall be deemed to be a new service offered for the 20080H2200B3218 - 14 -
1 first time under section 2804(4)(vi) (relating to standards for 2 restructuring of electric industry). 3 (i) Reporting.--The commission shall submit an annual report 4 to the General Assembly describing the results of the programs 5 implemented by each of the electric distribution companies, 6 including, but not limited to: 7 (1) The costs, benefits and reductions in energy costs. 8 (2) Energy use by customer class within this 9 Commonwealth. 10 (3) Reductions in overall peak demand and projections 11 toward complying with the overall target reduction goals of 12 this section. 13 (j) Definitions.--For purposes of this section, the term 14 "electric distribution company" shall mean a public utility 15 providing facilities for the jurisdictional transmission and 16 distribution of electricity to 100,000 or more retail customers 17 in this Commonwealth. 18 SECTION 4. SECTION 2807(E) OF TITLE 66 IS AMENDED BY ADDING <-- 19 A PARAGRAPH TO READ: 20 § 2807. DUTIES OF ELECTRIC DISTRIBUTION COMPANIES. 21 * * * 22 (E) OBLIGATION TO SERVE.--* * * 23 (6) (I) WITHIN NINE MONTHS AFTER THE EFFECTIVE DATE OF 24 THIS PARAGRAPH, ELECTRIC DISTRIBUTION COMPANIES SHALL 25 FILE A SMART METER TECHNOLOGY PROCUREMENT AND 26 INSTALLATION PLAN WITH THE COMMISSION FOR APPROVAL AND 27 MAKE THE PLAN AVAILABLE FOR PUBLIC COMMENT FOR A MINIMUM 28 OF 30 DAYS. THE PLAN SHALL DESCRIBE THE SMART METER 29 TECHNOLOGIES THE ELECTRIC DISTRIBUTION COMPANY PROPOSES 30 TO INSTALL, HOW THE SMART METER TECHNOLOGY MEETS THE 20080H2200B3218 - 15 -
1 REQUIREMENTS OF THIS PARAGRAPH AND HOW THE SMART METER 2 TECHNOLOGY SHALL BE INSTALLED ACCORDING TO THIS 3 PARAGRAPH. IN ADDITION, THE PLAN SHALL ENSURE THAT ALL 4 SMART METER TECHNOLOGY INSTALLATION AND MAINTENANCE WORK 5 SHALL BE PERFORMED BY ADEQUATELY TRAINED AND QUALIFIED 6 PERSONNEL AND THAT, TO THE EXTENT PRACTICAL, SUCH WORK 7 SHALL BE OFFERED INITIALLY TO EMPLOYEES OF THE ELECTRIC 8 DISTRIBUTION COMPANY. 9 (II) ELECTRIC DISTRIBUTION COMPANIES SHALL FURNISH 10 SMART METER TECHNOLOGY TO: 11 (A) CUSTOMERS RESPONSIBLE FOR 40% OF THE 12 DISTRIBUTION COMPANY'S ANNUAL PEAK DEMAND WITHIN FOUR 13 YEARS AFTER THE EFFECTIVE DATE OF THIS PARAGRAPH. 14 (B) CUSTOMERS RESPONSIBLE FOR 75% OF THE 15 DISTRIBUTION COMPANY'S ANNUAL PEAK DEMAND WITHIN SIX 16 YEARS AFTER THE EFFECTIVE DATE OF THIS PARAGRAPH. 17 (C) ONE HUNDRED PERCENT OF ITS CUSTOMERS WITHIN 18 TEN YEARS AFTER THE EFFECTIVE DATE OF THIS PARAGRAPH. 19 ELECTRIC DISTRIBUTION COMPANIES SHALL, WITH CUSTOMER 20 CONSENT, MAKE AVAILABLE ELECTRONIC ACCESS TO CUSTOMER 21 METER DATA TO THIRD PARTIES, INCLUDING ELECTRIC 22 GENERATION SUPPLIERS AND PROVIDERS OF CONSERVATION AND 23 LOAD MANAGEMENT SERVICES. 24 (III) ELECTRIC DISTRIBUTION COMPANIES SHALL BE 25 PERMITTED TO RECOVER ALL REASONABLE AND PRUDENT COSTS, AS 26 DETERMINED BY THE COMMISSION, OF PROVIDING SMART METER 27 TECHNOLOGY, INCLUDING ANNUAL DEPRECATION AND CAPITAL 28 COSTS OVER THE LIFE OF THE SMART METER TECHNOLOGY, THAT 29 ARE INCURRED AFTER THE EFFECTIVE DATE OF THIS PARAGRAPH, 30 LESS ALL OPERATING AND CAPITAL COSTS SAVINGS REALIZED BY 20080H2200B3218 - 16 -
1 THE ELECTRIC DISTRIBUTION COMPANY FROM THE INTRODUCTION 2 AND USE OF THE SMART METER TECHNOLOGY. AN ELECTRIC 3 DISTRIBUTION COMPANY MAY, AT ITS OPTION, RECOVER SUCH 4 SMART METER TECHNOLOGY COSTS: 5 (A) THROUGH BASE RATES, INCLUDING A DEFERRAL FOR 6 FUTURE BASE RATE RECOVERY OF CURRENT COSTS, WITH 7 CARRYING CHARGES EQUAL TO 6%; OR 8 (B) ON A FULL AND CURRENT BASIS THROUGH A 9 RECONCILABLE AUTOMATIC ADJUSTMENT CLAUSE UNDER 10 SECTION 1307 (RELATING TO SLIDING SCALE OF RATES; 11 ADJUSTMENTS). 12 IN NO EVENT SHALL LOST OR DECREASED REVENUES BY AN 13 ELECTRIC DISTRIBUTION COMPANY DUE TO REDUCED ELECTRICITY 14 CONSUMPTION OR SHIFTING ENERGY DEMAND BE CONSIDERED A 15 COST OF SMART METER TECHNOLOGY. SMART METER TECHNOLOGY 16 SHALL BE DEEMED TO BE A NEW SERVICE OFFERED FOR THE FIRST 17 TIME UNDER SECTION 2804(4)(VI) (RELATING TO STANDARDS FOR 18 RESTRUCTURING OF ELECTRIC INDUSTRY). 19 (IV) BY JANUARY 1, 2010, OR AT THE END OF THE 20 APPLICABLE GENERATION RATE CAP PERIOD, WHICHEVER IS 21 LATER, A DEFAULT SERVICE PROVIDER SHALL SUBMIT TO THE 22 COMMISSION ONE OR MORE PROPOSED TIME-OF-USE RATES AND A 23 REAL-TIME PRICE PLAN. THE COMMISSION SHALL APPROVE OR 24 MODIFY THE TIME-OF-USE RATES AND REAL-TIME PRICE PLAN 25 WITHIN SIX MONTHS OF SUBMITTAL. THE DEFAULT SERVICE 26 PROVIDER SHALL OFFER COMMISSION-APPROVED TIME-OF-USE 27 RATES AND A REAL-TIME PRICE PLAN TO ALL RESIDENTIAL AND 28 COMMERCIAL CUSTOMERS THAT HAVE BEEN PROVIDED WITH SMART 29 METER TECHNOLOGY WITHIN 60 DAYS OF INSTALLATION OF THE 30 SMART METER TECHNOLOGY OR COMMISSION APPROVAL OF THE 20080H2200B3218 - 17 -
1 TIME-OF-USE RATES AND A REAL-TIME PRICE PLAN, WHICHEVER 2 IS LATER. CUSTOMER PARTICIPATION IN TIME-OF-USE RATES OR 3 REAL-TIME PRICING SHALL BE VOLUNTARY AND SHALL ONLY BE 4 PROVIDED WITH THE AFFIRMATIVE CONSENT OF THE CUSTOMER. 5 THE DEFAULT SERVICE PROVIDER SHALL SUBMIT AN ANNUAL 6 REPORT TO THE COMMISSION ON THE PARTICIPATION IN THE 7 TIME-OF-USE AND REAL-TIME PRICE PROGRAMS AND THE EFFICACY 8 OF THE PROGRAMS IN AFFECTING ENERGY DEMAND AND 9 CONSUMPTION AND THE EFFECT ON WHOLESALE MARKET PRICES. 10 (V) FOR PURPOSES OF THIS PARAGRAPH, THE TERM 11 "ELECTRIC DISTRIBUTION COMPANY" SHALL MEAN A PUBLIC 12 UTILITY PROVIDING FACILITIES FOR THE JURISDICTIONAL 13 TRANSMISSION AND DISTRIBUTION OF ELECTRICITY TO 100,000 14 OR MORE RETAIL CUSTOMERS IN THIS COMMONWEALTH. 15 Section 3 5. This act shall take effect immediately. <-- A11L66GRH/20080H2200B3218 - 18 -