SENATE AMENDED PRIOR PRINTER'S NOS. 3089, 3176, 3218, PRINTER'S NO. 4526 3233, 4429
No. 2200 Session of 2008
INTRODUCED BY GEORGE, McCALL, BELFANTI, CALTAGIRONE, CONKLIN, DALEY, N. P. 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
SENATOR TOMLINSON, CONSUMER PROTECTION AND PROFESSIONAL LICENSURE, IN SENATE, RE-REPORTED AS AMENDED, OCTOBER 7, 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 providing for adoption of energy efficiency and demand-side 5 response; and further providing for duties of electric 6 distribution companies. FURTHER PROVIDING FOR DEFINITIONS; <-- 7 PROVIDING FOR ENERGY EFFICIENCY AND CONSERVATION; FURTHER 8 PROVIDING FOR DUTIES OF ELECTRIC DISTRIBUTION COMPANIES; AND 9 PROVIDING FOR PROCUREMENT. FURTHER PROVIDING FOR DIRECTOR OF <-- 10 OPERATIONS, SECRETARY, EMPLOYEES AND CONSULTANTS; REPEALING 11 PROVISIONS RELATING TO OFFICE OF TRIAL STAFF; FURTHER 12 PROVIDING FOR BUREAUS AND OFFICES; PROVIDING FOR OTHER 13 BUREAUS, OFFICES AND POSITIONS; FURTHER PROVIDING FOR 14 ELECTRIC UTILITY DEFINITIONS; PROVIDING FOR ENERGY EFFICIENCY 15 AND CONSERVATION PROGRAM AND FOR ENERGY EFFICIENCY AND 16 CONSERVATION; FURTHER PROVIDING FOR DUTIES OF ELECTRIC 17 DISTRIBUTION COMPANIES AND FOR MARKET POWER REMEDIATION; AND 18 PROVIDING FOR PROCUREMENT, FOR ADDITIONAL ALTERNATIVE ENERGY 19 SOURCES AND FOR CARBON DIOXIDE SEQUESTRATION NETWORK. 20 THE GENERAL ASSEMBLY RECOGNIZES THE FOLLOWING PUBLIC POLICY 21 FINDINGS AND DECLARES THAT THE FOLLOWING OBJECTIVES OF THE 22 COMMONWEALTH ARE SERVED BY THIS ACT: 23 (1) THE HEALTH, SAFETY AND PROSPERITY OF ALL CITIZENS OF
1 THIS COMMONWEALTH ARE INHERENTLY DEPENDENT UPON THE 2 AVAILABILITY OF ADEQUATE, RELIABLE, AFFORDABLE, EFFICIENT AND 3 ENVIRONMENTALLY SUSTAINABLE ELECTRIC SERVICE AT THE LEAST 4 COST, TAKING INTO ACCOUNT ANY BENEFITS OF PRICE STABILITY, 5 OVER TIME AND THE IMPACT ON THE ENVIRONMENT. 6 (2) IT IS IN THE PUBLIC INTEREST TO ADOPT ENERGY 7 EFFICIENCY AND CONSERVATION MEASURES AND TO IMPLEMENT ENERGY 8 PROCUREMENT REQUIREMENTS DESIGNED TO ENSURE THAT ELECTRICITY 9 OBTAINED REDUCES THE POSSIBILITY OF ELECTRIC PRICE 10 INSTABILITY, PROMOTES ECONOMIC GROWTH AND ENSURES AFFORDABLE 11 AND AVAILABLE ELECTRIC SERVICE TO ALL RESIDENTS. 12 (3) IT IS IN THE PUBLIC INTEREST TO EXPAND THE USE OF 13 ALTERNATIVE ENERGY AND TO EXPLORE THE FEASIBILITY OF NEW 14 SOURCES OF ALTERNATIVE ENERGY TO PROVIDE ELECTRIC GENERATION 15 IN THIS COMMONWEALTH. 16 The General Assembly of the Commonwealth of Pennsylvania 17 hereby enacts as follows: 18 Section 1. Title 66 of the Pennsylvania Consolidated <-- 19 Statutes is amended by adding a section to read: 20 § 1329. Recovery of certain labor relations expenses. 21 No public utility may charge its customers as a permissible 22 operating expense for ratemaking purposes any portion of the 23 direct or indirect cost of meetings, publications, consultants, 24 attorneys or other professional services and expenses associated 25 with the utility's efforts to dissuade the employees of the 26 utility, or the employees of any affiliated interest of the 27 utility as defined in section 2101 (relating to definition of 28 affiliated interest), from becoming or remaining a member in, or 29 otherwise being represented by, any labor union. 30 Section 2. Section 2803 of Title 66 is amended by adding 20080H2200B4526 - 2 -
1 definitions to read: 2 § 2803. Definitions. 3 The following words and phrases when used in this chapter 4 shall have the meanings given to them in this section unless the 5 context clearly indicates otherwise: 6 "Affiliated interest." As defined in section 2101 (relating 7 to definition of affiliated interest). 8 * * * 9 "Cost effective." In relation to a program being evaluated, 10 satisfaction of the total resource cost test. 11 * * * 12 "Demand-side response." Load management technologies, 13 management practices or other strategies employed by retail 14 customers that decrease peak electricity demand or shift demand 15 from on-peak to off-peak periods provided that: 16 (1) The measure is installed on or after the effective 17 date of this section at the service location of a retail 18 customer. 19 (2) The measure reduces the peak demand or cost of 20 energy by the retail customer. 21 (3) The costs of the acquisition or installation of the 22 measure are directly incurred in whole or in part by the 23 electric distribution company. 24 * * * 25 "Energy efficiency." Technologies, management practices or 26 other strategies or measures employed by retail customers that 27 reduce electricity consumption provided that: 28 (1) The measure is installed on or after the effective 29 date of this definition at the service location of a retail 30 customer. 20080H2200B4526 - 3 -
1 (2) The measure reduces the consumption of energy by the 2 retail customer. 3 (3) The costs of the acquisition or installation of the 4 measure are directly incurred in whole or in part by the 5 electric distribution company. 6 "Independent entity." An entity with no direct or indirect 7 ownership, partnership or other affiliated interest with an 8 electric distribution company. 9 "Peak demand." The highest electrical requirement occurring 10 during a specified period. For an electric distribution company, 11 the term means the sum of the metered consumption for all retail 12 customers over that period. 13 "Real-time price." A rate that directly reflects the 14 different cost of energy during each hour. 15 * * * 16 "Smart meter technology." Technology, including, but not 17 limited to, metering technology and network communications 18 technology capable of bidirectional communication and that 19 records electricity usage on at least an hourly basis, including 20 related electric distribution system upgrades to enable the 21 technology. The technology shall provide customers with direct 22 access to and use of price and consumption information. The 23 technology shall also: 24 (1) Directly provide customers with information on their 25 hourly consumption. 26 (2) Enable time-of-use rates and real-time price 27 programs. 28 (3) Effectively support the automatic control of the 29 customer's electricity consumption by one or more of the 30 following as selected by the customer: 20080H2200B4526 - 4 -
1 (i) the customer; 2 (ii) the customer's utility; or 3 (iii) a third party engaged by the customer or the 4 customer's utility. 5 "Time-of-use rate." A rate that reflects the costs of 6 serving customers during different time periods, including off- 7 peak and on-peak periods, but not as frequently as each hour. 8 "Total resources cost test." A standard test that is met if, 9 over the effective life of the program, the avoided supply-side 10 monetary costs are greater than the monetary costs of the 11 demand-side programs borne by both the electric distribution 12 company and the participants. 13 * * * 14 Section 3. Title 66 is amended by adding a section to read: 15 § 2806.1. Adoption of procedures encouraging energy efficiency 16 and demand-side response. 17 (a) Program.--The commission shall develop a program to 18 provide for the implementation of cost-effective programs that 19 reduce energy demand and consumption within the service 20 territories of all electric distribution companies throughout 21 this Commonwealth. The program shall include, but is not limited 22 to, the following: 23 (1) Selecting a program administrator to develop and 24 oversee the delivery of energy efficiency and demand-side 25 response programs within the service territory of each 26 electric distribution company within this Commonwealth. 27 (2) Implementing the necessary administrative and 28 financial mechanisms that will enable the program 29 administrator to develop and oversee the provision of energy 30 efficiency and demand-side response programs within the 20080H2200B4526 - 5 -
1 service territory of each electric distribution company 2 within this Commonwealth, including the levying of 3 assessments in accordance with sections 510 (relating to 4 assessment for regulatory expenses upon public utilities), 5 1307 (relating to sliding scale of rates; adjustments) and 6 1308 (relating to voluntary changes in rates). The commission 7 shall not approve or implement and shall not assess or charge 8 to customers the costs of energy efficiency or demand- 9 response programs to the extent that the costs of such 10 programs exceed 2% of the total annual revenues of the 11 electric distribution company from all sources, including 12 default service generation revenues as of January 1, 2007. 13 This funding limit shall not include amounts provided for by 14 the low-income usage reduction programs established under 15 regulations at 52 Pa. Code Ch. 58 (relating to residential 16 low income usage reduction programs). 17 (3) Implementing the necessary administrative and 18 financial mechanisms that facilitate a system of third-party 19 entities to deliver all or portions of the energy efficiency 20 and demand-side response programs within the service 21 territory of each electric distribution company within this 22 Commonwealth, including the levying of assessments in 23 accordance with sections 510, 1307 and 1308. The commission 24 may order the electric distribution company to pay the third- 25 party entity for services rendered in an electric 26 distribution company's respective service territory pursuant 27 to this section. The electric distribution company may be a 28 third-party entity. 29 (b) Selection of program administrator.--The commission 30 shall implement the following procedures when selecting a 20080H2200B4526 - 6 -
1 program administrator: 2 (1) The commission shall prepare a request for proposals 3 for a program administrator to provide for the development 4 and delivery of the energy efficiency and demand-side 5 response programs in the service territories of all electric 6 distribution companies and shall make the request for 7 proposals available for public comment. 8 (2) The commission shall, within 60 days of the 9 completion of the public comment period, issue the final 10 request for proposals. 11 (3) The commission shall, based on a competitive bid 12 process, select an independent entity to serve as the energy 13 efficiency and demand-side response program administrator. 14 (4) The commission shall include as a part of its 15 agreement with the program administrator a system of 16 performance parameters and a financial mechanism that 17 provides incentives for exceeding established performance 18 parameters and penalties for third parties not meeting 19 established performance parameters. 20 (c) Powers and duties of program administrator.--The program 21 administrator shall have powers and duties assigned by the 22 commission. The powers and duties shall include, but not be 23 limited to: 24 (1) Soliciting through a competitive procurement process 25 within each electric distribution company service territory a 26 program of providing energy efficiency and demand-side 27 response programs to residential, commercial and industrial 28 customers utilizing third-party entities. 29 (2) Ensuring that each proposal includes, but is not 30 limited to: 20080H2200B4526 - 7 -
1 (i) A clear delineation of how the program will be 2 conducted. 3 (ii) The types of specific program measures to be 4 offered. 5 (iii) The cost and benefit of each program to be 6 offered. 7 (iv) A process for monitoring and verifying results, 8 data collection and management procedures, program 9 evaluation processes and financial management strategies. 10 (3) In its review of each proposal received: 11 (i) Taking into account the unique circumstances of 12 each electric distribution company's service territory. 13 (ii) Finding that each program is cost effective and 14 that the portfolio of programs is designed to provide 15 every affected customer class with the opportunity to 16 participate and benefit economically. 17 (iii) Determining the cost-effectiveness of energy 18 efficiency and demand-side response measures using the 19 total resource cost test. 20 (4) Recommending to the commission those entities best 21 suited to provide energy efficiency and demand-side response 22 programs within the service territory of each electric 23 distribution company. 24 (5) In the event no qualified proposals are received 25 that meet the required plan goals in an electric distribution 26 company service territory to conduct the program activities: 27 (i) Issuing a subsequent request for proposals with 28 plan goals that are reduced no more than necessary to 29 obtain qualified proposals to provide program activities. 30 The lowered plan goals for energy efficiency and demand- 20080H2200B4526 - 8 -
1 side response shall only be in effect for that year. 2 (ii) In subsequent years, utilizing the plan goals 3 unless no qualified proposals are received to conduct the 4 program activities that meet the plan goals, the program 5 administrator shall issue a subsequent request for 6 proposals in accordance with the procedures identified in 7 this subparagraph. 8 (6) Executing agreements on behalf of the commission 9 with the selected entity in each electric distribution 10 company service territory to conduct the energy efficiency 11 and demand-side response program. As part of these agreements 12 the program administrator shall ensure that: 13 (i) The programs offered by the selected entity are 14 provided equitably across all customer classes. 15 (ii) A clearly defined process for financial 16 compensation for the entity delivering the program which 17 is tied to defined goals for performance regarding 18 program activities accomplished, energy cost savings on a 19 per-customer basis and utility-wide basis and overall 20 energy and peak demand reduction is established. 21 (iii) A system of incentives and penalties for 22 performance of contractual activities above and below 23 predetermined levels is in place. 24 (iv) There is a set contract term which may include 25 an initial three-year term with renewal terms of varied 26 length. 27 (7) Submitting reports to the commission at such times 28 and in such manner as the commission directs. 29 (d) Commission review of recommendations.--The commission 30 shall review the recommendations made by the program 20080H2200B4526 - 9 -
1 administrator regarding those entities best suited to provide 2 energy efficiency and demand-side response programs within the 3 service territory of each electric distribution company. The 4 commission shall approve or disapprove the recommendations made 5 by the program administrator. 6 (1) The commission review of the recommendations of the 7 program administrator shall be limited to ensuring that: 8 (i) There is no evidence of fraud or market abuse. 9 (ii) Any costs entered into are borne by the 10 appropriate parties and that costs, including the costs 11 of subsection (c)(6)(iii) incentives, related to the 12 provision of the contracted services are borne by the 13 appropriate customer class. 14 (iii) There will be provided, in a cost-effective 15 manner, a program that provides energy efficiency and 16 demand-side response measures to all customer classes 17 throughout the service territory of each electric 18 distribution company. 19 (2) If the commission approves a third-party entity to 20 conduct the program, the commission shall ensure the program 21 administrator finalizes the agreement between the commission 22 and the third-party entity selected to provide the program of 23 energy efficiency and demand-side response. 24 (3) In the event the commission disapproves the 25 recommendation of the program administrator, the commission 26 shall provide a rationale for this decision and direct the 27 program administrator on a course of action. 28 (e) Plan goals.--The program administrator shall ensure that 29 each proposal submitted by a third-party entity to deliver a 30 program of energy efficiency and demand-side response measures 20080H2200B4526 - 10 -
1 includes meeting the following energy saving goals: 2 (1) The following relate to energy efficiency goals: 3 (i) By May 31, 2011, total annual deliveries to 4 retail customers of electric distribution companies shall 5 be reduced by a minimum of 1%. This load reduction shall 6 be measured against the expected load forecasted by the 7 commission for June 1, 2010, through May 31, 2011, based 8 on load for the period June 1, 2007, through May 31, 9 2008, with provision made for weather adjustments and 10 extraordinary load that the electric distribution company 11 must serve. The commission shall determine and make 12 public the forecasts to be used for each electric 13 distribution company no later than August 31, 2008. The 14 program administrator shall ensure that a third-party 15 entity meets the goals contained in this section through 16 the implementation of a program of energy efficiency 17 measures throughout the service territory of the electric 18 distribution company. 19 (ii) By May 31, 2013, total annual deliveries to 20 retail customers of electric distribution companies shall 21 be reduced by a minimum of 2.5%. This load reduction 22 shall be measured against the expected load forecasted by 23 the commission for June 1, 2012, through May 31, 2013, 24 based on load for the period June 1, 2007, through May 25 31, 2008, with provision made for weather adjustments and 26 extraordinary load that the electric distribution company 27 must serve. The commission shall determine and make 28 public the forecasts to be used for each electric 29 distribution company no later than August 31, 2008. The 30 program administrator shall ensure that a third-party 20080H2200B4526 - 11 -
1 entity meets the goals contained in this section through 2 the implementation of a program of energy efficiency 3 measures throughout the service territory of the electric 4 distribution company. 5 (iii) By November 30, 2013, the program 6 administrator shall evaluate the costs and benefits of 7 these energy efficiency and conservation programs. If the 8 benefits have been shown to exceed the costs, consistent 9 with the total resource cost test, the program 10 administrator, in consultation with the commission, shall 11 set additional, incremental energy efficiency and 12 conservation goals for the period ending May 31, 2018. 13 (iv) After May 31, 2018, the program administrator 14 shall continue to evaluate the costs and benefits of 15 efficiency and conservation measures and, in consultation 16 with the commission, may adopt additional incremental 17 load reduction standards for electric distribution 18 companies. 19 (2) The following relate to demand-side response 20 measures: 21 (i) Cost-effective demand-side response measures to 22 reduce peak demand by a minimum of 4% in the 100 hours of 23 highest demand with provision made for weather 24 adjustments and extraordinary load that the electric 25 distribution company must serve shall be implemented in 26 each electric distribution company's service territory. 27 This reduction will be measured against the electric 28 distribution company's peak demand in the 100 hours of 29 greatest demand for June 1, 2007, through May 31, 2008. 30 The reductions shall be accomplished by May 31, 2012. 20080H2200B4526 - 12 -
1 (ii) By November 30, 2012, the program administrator 2 shall compare the total costs of these demand-side 3 response measures to the total savings in energy and 4 capacity costs to retail customers of this Commonwealth. 5 If the benefits have been shown to exceed the costs, 6 consistent with the total resource cost test, the 7 commission shall order additional peak demand reductions 8 for the 100 hours of greatest demand or an alternative 9 measure adopted by the commission. The reductions shall 10 be measured from the electric distribution company's peak 11 demand for the period from June 1, 2011, through May 31, 12 2012. The mandated reductions shall be accomplished no 13 later than May 31, 2017. 14 (iii) After May 31, 2017, the program administrator 15 shall continue to evaluate the costs and benefits of 16 demand-side response measures and may, in consultation 17 with the commission, adopt additional incremental peak 18 load reduction standards. 19 (f) Measurements and verification.--The commission shall 20 establish standards by which the program administrator submits 21 to the commission an annual report, which includes that 22 information relating to the actions and results of the energy 23 efficiency and demand-side response programs undertaken within 24 each electric distribution service territory by each third-party 25 entity. 26 (1) The report shall include, but not be limited to: 27 (i) Documentation of program expenditures. 28 (ii) Measurement and verification of savings 29 resulting from programs. 30 (iii) Evaluation of the cost-effectiveness of 20080H2200B4526 - 13 -
1 expenditures. 2 (iv) Any other information the commission may 3 require pursuant to its rulemaking authority. 4 (2) The program administrator, upon consultation with 5 the commission, shall direct a third-party entity to modify 6 or terminate a particular energy efficiency or a demand-side 7 response program if, after an adequate period for 8 implementation of the program, the commission determines the 9 program is not sufficiently meeting its goals and purposes. 10 (3) In the event an energy efficiency or demand-side 11 response program is terminated, the program administrator 12 shall require the third-party entity to submit a revised 13 program describing the actions to be undertaken to either 14 offer a substitute program or increase the availability of 15 existing programs to make up for the effect of the terminated 16 program on its overall program goals. 17 (g) Responsibilities of electric distribution companies.-- 18 Each electric distribution company that does not seek to be a 19 third-party entity shall: 20 (1) Cooperate with the program administrator as needed 21 in its efforts to competitively procure the services of a 22 third-party entity to provide an energy efficiency and 23 demand-side response program within the service territory of 24 the electric distribution company. 25 (2) Provide information necessary to effectively 26 facilitate the work of the selected third-party entity in 27 conducting the energy efficiency and demand-side response 28 program. 29 (3) Provide assistance as may be requested by the 30 program administrator in reviewing proposals from third-party 20080H2200B4526 - 14 -
1 entities seeking to provide energy efficiency and demand-side 2 response programs within their service territories. 3 (4) Provide assistance as may be requested by the 4 program administrator to facilitate the successful execution 5 of the contract agreement with the third-party entities to 6 provide an energy efficiency and demand-side response program 7 within their service territories. 8 (h) Recovery of administrative and program costs.--An 9 electric distribution company may fully recover all 10 administrative costs, including, but not limited to, costs 11 incurred under subsections (a)(3) and (g)(1), (2), (3) and (4), 12 that the commission determines are prudently incurred and 13 reasonable in amount pursuant to implementing a program to 14 deliver cost-effective energy efficiency and demand-side 15 response activities through a third-party entity. Program and 16 administrative costs shall be recovered on a full and current 17 basis by the electric distribution company from customers 18 through a reconcilable automatic adjustment clause pursuant to 19 section 1307. Energy efficiency and demand-side resource 20 programs shall be deemed to be a new service offered for the 21 first time under section 2804(4)(vi) (relating to standards for 22 restructuring of electric industry). 23 (i) Reporting.--The commission shall submit an annual report 24 to the General Assembly describing the results of the programs 25 implemented by each of the electric distribution companies, 26 including, but not limited to: 27 (1) The costs, benefits and reductions in energy costs. 28 (2) Energy use by customer class within this 29 Commonwealth. 30 (3) Reductions in overall peak demand and projections 20080H2200B4526 - 15 -
1 toward complying with the overall target reduction goals of 2 this section. 3 (j) Definitions.--For purposes of this section, the term 4 "electric distribution company" shall mean a public utility 5 providing facilities for the jurisdictional transmission and 6 distribution of electricity to 100,000 or more retail customers 7 in this Commonwealth. 8 Section 4. Section 2807(e) of Title 66 is amended by adding 9 a paragraph to read: 10 § 2807. Duties of electric distribution companies. 11 * * * 12 (e) Obligation to serve.--* * * 13 (6) (i) Within nine months after the effective date of 14 this paragraph, electric distribution companies shall 15 file a smart meter technology procurement and 16 installation plan with the commission for approval and 17 make the plan available for public comment for a minimum 18 of 30 days. The plan shall describe the smart meter 19 technologies the electric distribution company proposes 20 to install, how the smart meter technology meets the 21 requirements of this paragraph and how the smart meter 22 technology shall be installed according to this 23 paragraph. In addition, the plan shall ensure that all 24 smart meter technology installation and maintenance work 25 shall be performed by adequately trained and qualified 26 personnel and that, to the extent practical, such work 27 shall be offered initially to employees of the electric 28 distribution company. 29 (ii) Electric distribution companies shall furnish 30 smart meter technology to: 20080H2200B4526 - 16 -
1 (A) Customers responsible for 40% of the 2 distribution company's annual peak demand within four 3 years after the effective date of this paragraph. 4 (B) Customers responsible for 75% of the 5 distribution company's annual peak demand within six 6 years after the effective date of this paragraph. 7 (C) One hundred percent of its customers within 8 ten years after the effective date of this paragraph. 9 Electric distribution companies shall, with customer 10 consent, make available electronic access to customer 11 meter data to third parties, including electric 12 generation suppliers and providers of conservation and 13 load management services. 14 (iii) Electric distribution companies shall be 15 permitted to recover all reasonable and prudent costs, as 16 determined by the commission, of providing smart meter 17 technology, including annual deprecation and capital 18 costs over the life of the smart meter technology, that 19 are incurred after the effective date of this paragraph, 20 less all operating and capital costs savings realized by 21 the electric distribution company from the introduction 22 and use of the smart meter technology. An electric 23 distribution company may, at its option, recover such 24 smart meter technology costs: 25 (A) through base rates, including a deferral for 26 future base rate recovery of current costs, with 27 carrying charges equal to 6%; or 28 (B) on a full and current basis through a 29 reconcilable automatic adjustment clause under 30 section 1307 (relating to sliding scale of rates; 20080H2200B4526 - 17 -
1 adjustments). 2 In no event shall lost or decreased revenues by an 3 electric distribution company due to reduced electricity 4 consumption or shifting energy demand be considered a 5 cost of smart meter technology. Smart meter technology 6 shall be deemed to be a new service offered for the first 7 time under section 2804(4)(vi) (relating to standards for 8 restructuring of electric industry). 9 (iv) By January 1, 2010, or at the end of the 10 applicable generation rate cap period, whichever is 11 later, a default service provider shall submit to the 12 commission one or more proposed time-of-use rates and a 13 real-time price plan. The commission shall approve or 14 modify the time-of-use rates and real-time price plan 15 within six months of submittal. The default service 16 provider shall offer commission-approved time-of-use 17 rates and a real-time price plan to all residential and 18 commercial customers that have been provided with smart 19 meter technology within 60 days of installation of the 20 smart meter technology or commission approval of the 21 time-of-use rates and a real-time price plan, whichever 22 is later. Customer participation in time-of-use rates or 23 real-time pricing shall be voluntary and shall only be 24 provided with the affirmative consent of the customer. 25 The default service provider shall submit an annual 26 report to the commission on the participation in the 27 time-of-use and real-time price programs and the efficacy 28 of the programs in affecting energy demand and 29 consumption and the effect on wholesale market prices. 30 (v) For purposes of this paragraph, the term 20080H2200B4526 - 18 -
1 "electric distribution company" shall mean a public 2 utility providing facilities for the jurisdictional 3 transmission and distribution of electricity to 100,000 4 or more retail customers in this Commonwealth. 5 Section 5. This act shall take effect immediately. 6 SECTION 1. SECTION 2803 OF TITLE 66 OF THE PENNSYLVANIA <-- 7 CONSOLIDATED STATUTES IS AMENDED BY ADDING DEFINITIONS TO READ: 8 § 2803. DEFINITIONS. 9 THE FOLLOWING WORDS AND PHRASES WHEN USED IN THIS CHAPTER 10 SHALL HAVE THE MEANINGS GIVEN TO THEM IN THIS SECTION UNLESS THE 11 CONTEXT CLEARLY INDICATES OTHERWISE: 12 * * * 13 "BILATERAL CONTRACT." AN AGREEMENT, AS APPROVED BY THE 14 PENNSYLVANIA PUBLIC UTILITY COMMISSION, REACHED BY TWO PARTIES, 15 EACH ACTING IN ITS OWN INDEPENDENT SELF-INTEREST, AS A RESULT OF 16 NEGOTIATIONS FREE OF UNDUE INFLUENCE, DURESS OR FAVORITISM, IN 17 WHICH THE ELECTRIC ENERGY SUPPLIER AGREES TO SELL AND THE 18 ELECTRIC DISTRIBUTION COMPANY AGREES TO BUY A QUANTITY OF 19 ELECTRIC ENERGY AT A SPECIFIED PRICE FOR A SPECIFIED PERIOD OF 20 TIME UNDER TERMS AGREED TO BY BOTH PARTIES, AND WHICH FOLLOWS A 21 STANDARD INDUSTRY TEMPLATE WIDELY ACCEPTED IN THE INDUSTRY OR 22 VARIATIONS THERETO ACCEPTED BY THE PARTIES. STANDARD INDUSTRY 23 TEMPLATES MAY INCLUDE THE EEI MASTER AGREEMENT FOR PHYSICAL 24 ENERGY PURCHASES AND SALES AND THE ISDA MASTER AGREEMENT FOR 25 FINANCIAL ENERGY PURCHASES AND SALES. 26 * * * 27 "DEFAULT SERVICE PROVIDER." AN ELECTRIC DISTRIBUTION COMPANY 28 WITHIN ITS CERTIFIED SERVICE TERRITORY OR AN ALTERNATIVE 29 SUPPLIER APPROVED BY THE PENNSYLVANIA PUBLIC UTILITY COMMISSION 30 THAT PROVIDES GENERATION SERVICE TO RETAIL ELECTRIC CUSTOMERS 20080H2200B4526 - 19 -
1 WHO: 2 (1) CONTRACT FOR ELECTRIC POWER, INCLUDING ENERGY AND 3 CAPACITY, AND THE CHOSEN ELECTRIC GENERATION SUPPLIER DOES 4 NOT SUPPLY THE SERVICE; OR 5 (2) DO NOT CHOOSE AN ALTERNATIVE ELECTRIC GENERATION 6 SUPPLIER. 7 SECTION 2. TITLE 66 IS AMENDED BY ADDING A SECTION TO READ: 8 § 2806.1. ENERGY EFFICIENCY AND CONSERVATION. 9 (A) PROGRAM.--THE COMMISSION SHALL ADOPT A PROGRAM TO 10 REQUIRE ELECTRIC DISTRIBUTION COMPANIES TO ADOPT AND IMPLEMENT 11 COST-EFFECTIVE ENERGY EFFICIENCY AND CONSERVATION PLANS TO 12 REDUCE ENERGY DEMAND AND CONSUMPTION WITHIN THE SERVICE 13 TERRITORIES OF ALL ELECTRIC DISTRIBUTION COMPANIES IN THIS 14 COMMONWEALTH. THE PROGRAM SHALL INCLUDE: 15 (1) PROCEDURES FOR THE APPROVAL OF PLANS SUBMITTED UNDER 16 SUBSECTION (B). 17 (2) A PLAN EVALUATION PROCESS INCLUDING A PROCESS TO 18 MONITOR AND VERIFY DATA COLLECTION, QUALITY ASSURANCE AND 19 RESULTS SUBMITTED. 20 (3) AN ANALYSIS OF THE COST AND BENEFIT OF EACH PLAN 21 SUBMITTED UNDER SUBSECTION (B) IN ACCORDANCE WITH A TOTAL 22 RESOURCE COST TEST. 23 (4) AN ANALYSIS OF HOW THE PROGRAM AND INDIVIDUAL PLANS 24 WILL ENABLE EACH ELECTRIC DISTRIBUTION COMPANY TO ACHIEVE THE 25 REQUIREMENTS FOR REDUCTION IN CONSUMPTION UNDER SUBSECTIONS 26 (C) AND (D). 27 (5) STANDARDS TO ENSURE THAT EACH PLAN INCLUDES A 28 VARIETY OF ENERGY EFFICIENCY AND CONSERVATION MEASURES AND 29 WILL PROVIDE THE MEASURES EQUITABLY TO ALL CLASSES OF 30 CUSTOMERS. 20080H2200B4526 - 20 -
1 (6) PROCEDURES TO REVIEW ALL PROPOSED CONTRACTS PRIOR TO 2 THE EXECUTION OF THE CONTRACT WITH THIRD-PARTY ENTITIES TO 3 IMPLEMENT THE PLAN. THE COMMISSION MAY ORDER THE MODIFICATION 4 OF A PROPOSED CONTRACT TO ENSURE THAT THE PLAN IS ADEQUATE. 5 (7) PROCEDURES TO ENSURE COMPLIANCE WITH REQUIREMENTS 6 FOR REDUCTION IN CONSUMPTION UNDER SUBSECTIONS (C) AND (D). 7 (8) A REQUIREMENT FOR THE PARTICIPATION OF THIRD-PARTY 8 ENTITIES IN THE IMPLEMENTATION OF ALL OR PART OF A PLAN. 9 (9) A PROCESS TO LINK REDUCTIONS IN CONSUMPTION TO THE 10 COMPENSATION OF THIRD-PARTY ENTITIES. 11 (10) PROCEDURES FOR THE LEVY OF ASSESSMENTS IN 12 ACCORDANCE WITH SECTIONS 510 (RELATING TO ASSESSMENT FOR 13 REGULATORY EXPENSES UPON PUBLIC UTILITIES) AND 1308 (RELATING 14 TO VOLUNTARY CHANGES IN RATES) SUBJECT TO THE LIMITATIONS OF 15 SUBSECTION (G) TO FUND PLANS FILED UNDER SUBSECTION (B) 16 SUBJECT TO THE LIMITATIONS SET FORTH UNDER SUBSECTION (G). 17 (B) DUTIES OF ELECTRIC DISTRIBUTION COMPANIES.-- 18 (1) (I) BY NOVEMBER 15, 2008, EACH ELECTRIC 19 DISTRIBUTION COMPANY SHALL DEVELOP AND FILE AN ENERGY 20 EFFICIENCY AND CONSERVATION PLAN WITH THE COMMISSION FOR 21 APPROVAL TO MEET THE REQUIREMENTS OF SUBSECTION (A) AND 22 THE REQUIREMENTS FOR REDUCTION IN CONSUMPTION UNDER 23 SUBSECTIONS (C) AND (D). THE PLAN SHALL BE IMPLEMENTED 24 UPON APPROVAL BY THE COMMISSION AND SHALL COMPLY WITH ALL 25 OF THE FOLLOWING: 26 (A) INCLUDE SPECIFIC PROPOSALS TO IMPLEMENT 27 ENERGY EFFICIENCY AND CONSERVATION MEASURES TO 28 ACHIEVE THE REQUIRED REDUCTIONS IN CONSUMPTION UNDER 29 SUBSECTIONS (C) AND (D). 30 (B) A MINIMUM OF 10% OF THE REQUIRED REDUCTIONS 20080H2200B4526 - 21 -
1 IN CONSUMPTION UNDER SUBSECTIONS (C) AND (D) SHALL BE 2 OBTAINED FROM UNITS OF FEDERAL, STATE AND LOCAL 3 GOVERNMENT, INCLUDING MUNICIPALITIES, SCHOOL 4 DISTRICTS, INSTITUTIONS OF HIGHER EDUCATION AND 5 NONPROFIT ENTITIES. 6 (C) THE MANNER IN WHICH PERFORMANCE WILL BE 7 MEASURED, VERIFIED AND EVALUATED. 8 (D) THE MANNER IN WHICH THE PLAN WILL ACHIEVE 9 THE REQUIREMENTS OF THE PROGRAM UNDER SUBSECTION (A) 10 AND THE REQUIRED REDUCTIONS IN CONSUMPTION UNDER 11 SUBSECTIONS (C) AND (D). 12 (E) INCLUDE A CONTRACT WITH ONE OR MORE THIRD- 13 PARTY ENTITIES TO IMPLEMENT THE PLAN OR A PORTION OF 14 THE PLAN AS APPROVED BY THE COMMISSION. 15 (F) INCLUDE ESTIMATES OF THE COST OF 16 IMPLEMENTATION OF THE ENERGY EFFICIENCY AND 17 CONSERVATION MEASURES IN THE PLAN. 18 (G) INCLUDE SPECIFIC ENERGY EFFICIENCY MEASURES 19 FOR HOUSEHOLDS AT OR BELOW 150% OF THE FEDERAL 20 POVERTY INCOME GUIDELINES. THE NUMBER OF MEASURES 21 SHALL BE PROPORTIONATE TO THOSE HOUSEHOLDS' SHARE OF 22 THE TOTAL ENERGY USAGE IN THIS COMMONWEALTH. THE 23 ELECTRIC DISTRIBUTION COMPANY SHALL COORDINATE 24 MEASURES UNDER THIS CLAUSE WITH OTHER PROGRAMS 25 ADMINISTERED BY THE COMMISSION OR ANOTHER FEDERAL OR 26 STATE AGENCY. THE EXPENDITURES OF AN ELECTRIC 27 DISTRIBUTION COMPANY UNDER THIS CLAUSE SHALL BE IN 28 ADDITION TO EXPENDITURES MADE UNDER 52 PA. CODE CH. 29 58 (RELATING TO RESIDENTIAL LOW INCOME USAGE 30 REDUCTION PROGRAMS). 20080H2200B4526 - 22 -
1 (H) INCLUDE A PROPOSED COST-RECOVERY TARIFF 2 MECHANISM TO FUND THE ENERGY EFFICIENCY AND 3 CONSERVATION MEASURES AND TO ENSURE RECOVERY OF THE 4 PRUDENT AND REASONABLE COSTS OF THE PLAN AS APPROVED 5 BY THE COMMISSION. 6 (I) A DEMONSTRATION THAT THE PLAN IS COST- 7 EFFECTIVE USING A TOTAL RESOURCE COST TEST OR OTHER 8 COST-BENEFIT ANALYSIS APPROVED BY THE COMMISSION AND 9 PROVIDES A DIVERSE CROSS SECTION OF ALTERNATIVES FOR 10 CUSTOMERS OF ALL RATE CLASSES. 11 (J) REQUIRE AN ANNUAL INDEPENDENT EVALUATION OF 12 THE PERFORMANCE OF THE COST-EFFECTIVENESS OF THE PLAN 13 AND A FULL REVIEW OF THE FIVE-YEAR RESULTS OF THE 14 PLAN AND, TO THE EXTENT PRACTICABLE, HOW THE PLAN 15 WILL BE ADJUSTED ON A GOING-FORWARD BASIS AS A RESULT 16 OF THE EVALUATION. 17 (II) A NEW PLAN SHALL BE FILED WITH THE COMMISSION 18 EVERY FIVE YEARS OR AS OTHERWISE REQUIRED BY THE 19 COMMISSION. THE PLAN SHALL SET FORTH THE MANNER IN WHICH 20 THE COMPANY WILL MEET THE REQUIRED REDUCTIONS IN 21 CONSUMPTION UNDER SUBSECTIONS (C) AND (D). 22 (III) NO MORE THAN 2% OF FUNDS AVAILABLE TO 23 IMPLEMENT A PLAN UNDER THIS SUBSECTION SHALL BE ALLOCATED 24 FOR EXPERIMENTAL EQUIPMENT OR DEVICES. 25 (2) THE COMMISSION SHALL DIRECT AN ELECTRIC DISTRIBUTION 26 COMPANY TO MODIFY OR TERMINATE ANY PART OF A PLAN APPROVED 27 UNDER THIS SECTION IF, AFTER AN ADEQUATE PERIOD FOR 28 IMPLEMENTATION, THE COMMISSION DETERMINES THAT AN ENERGY 29 EFFICIENCY OR CONSERVATION MEASURE INCLUDED IN THE PLAN IS 30 NOT EFFECTIVE. 20080H2200B4526 - 23 -
1 (3) IF PART OF A PLAN IS MODIFIED OR TERMINATED UNDER 2 PARAGRAPH (2), THE ELECTRIC DISTRIBUTION COMPANY SHALL SUBMIT 3 A REVISED PLAN DESCRIBING ACTIONS TO BE TAKEN TO OFFER 4 SUBSTITUTE MEASURES OR TO INCREASE THE AVAILABILITY OF 5 EXISTING MEASURES IN THE PLAN TO ACHIEVE THE REQUIRED 6 REDUCTIONS IN CONSUMPTION UNDER SUBSECTIONS (C) AND (D). 7 (C) REDUCTIONS IN CONSUMPTION.--EACH ELECTRIC DISTRIBUTION 8 COMPANY SHALL REDUCE CONSUMPTION AS FOLLOWS: 9 (1) BY MAY 31, 2011, EACH ELECTRIC DISTRIBUTION COMPANY 10 SHALL REDUCE ITS TOTAL ANNUAL WEATHER-NORMALIZED DELIVERIES 11 TO RETAIL CUSTOMERS BY A MINIMUM OF 1%. THE 1% LOAD REDUCTION 12 IN CONSUMPTION SHALL BE MEASURED AGAINST THE ELECTRIC 13 DISTRIBUTION COMPANY'S EXPECTED LOAD AS FORECASTED BY THE 14 COMMISSION FOR JUNE 1, 2007 THROUGH MAY 31, 2008, WITH 15 PROVISIONS MADE FOR WEATHER ADJUSTMENTS AND EXTRAORDINARY 16 LOADS THAT THE ELECTRIC DISTRIBUTION COMPANY MUST SERVE. 17 (2) BY MAY 31, 2013, EACH ELECTRIC DISTRIBUTION COMPANY 18 SHALL REDUCE ITS TOTAL ANNUAL WEATHER-NORMALIZED DELIVERIES 19 TO RETAIL CUSTOMERS BY A MINIMUM OF 2.5%. THE 2.5% LOAD 20 REDUCTION IN CONSUMPTION SHALL BE MEASURED AGAINST THE 21 ELECTRIC DISTRIBUTION COMPANY'S EXPECTED LOAD AS FORECASTED 22 BY THE COMMISSION FOR JUNE 1, 2007, THROUGH MAY 31, 2008, 23 WITH PROVISION MADE FOR WEATHER ADJUSTMENTS AND EXTRAORDINARY 24 LOADS THAT THE ELECTRIC DISTRIBUTION COMPANY MUST SERVE. 25 (3) BY NOVEMBER 30, 2013, THE COMMISSION SHALL EVALUATE 26 THE COSTS AND BENEFITS OF THE PROGRAM ESTABLISHED UNDER 27 SUBSECTION (A) AND ENERGY EFFICIENCY AND CONSERVATION PLANS 28 SUBMITTED TO THE PROGRAM. THE EVALUATION SHALL BE CONSISTENT 29 WITH A TOTAL RESOURCE COST TEST OR A COST VERSUS BENEFIT 30 MEASUREMENT DETERMINED BY THE COMMISSION. IF THE COMMISSION 20080H2200B4526 - 24 -
1 DETERMINES THAT THE BENEFITS OF THE PROGRAM EXCEED THE COSTS, 2 THE COMMISSION SHALL ADOPT ADDITIONAL INCREMENTAL REQUIRED 3 REDUCTIONS IN CONSUMPTION FOR THE PERIOD ENDING MAY 31, 2018. 4 (4) AFTER MAY 31, 2018, THE COMMISSION SHALL CONTINUE TO 5 EVALUATE THE COSTS AND BENEFITS OF THE PROGRAM ESTABLISHED 6 UNDER SUBSECTION (A) AND ENERGY EFFICIENCY AND CONSERVATION 7 PLANS APPROVED UNDER SUBSECTION (A). IF THE COMMISSION 8 DETERMINES THAT THE BENEFITS OF THE PROGRAM EXCEED THE COSTS, 9 THE COMMISSION MAY REQUIRE AND APPROVE ADDITIONAL PLANS TO 10 ACHIEVE INCREMENTAL REQUIREMENTS FOR REDUCTION IN CONSUMPTION 11 FOR ELECTRIC DISTRIBUTION COMPANIES. EACH PLAN SHALL BE FOR A 12 TERM NOT TO EXCEED FIVE YEARS. 13 (D) PEAK DEMAND.--EACH ELECTRIC DISTRIBUTION COMPANY SHALL 14 IMPLEMENT ENERGY EFFICIENCY AND CONSERVATION MEASURES TO ACHIEVE 15 THE FOLLOWING REDUCTIONS IN CONSUMPTION: 16 (1) BY MAY 31, 2013, EACH ENERGY DISTRIBUTION COMPANY 17 SHALL REDUCE ITS WEATHER-NORMALIZED DELIVERIES TO RETAIL 18 CUSTOMERS BY A MINIMUM OF 4% IN THE 100 HOURS OF HIGHEST 19 DEMAND. THE REDUCTION SHALL BE MEASURED AGAINST THE ELECTRIC 20 DISTRIBUTION COMPANY'S PEAK DEMAND IN THE 100 HOURS OF 21 GREATEST DEMAND FOR JUNE 1, 2007, THROUGH MAY 31, 2008. 22 (2) BY NOVEMBER 30, 2013, THE COMMISSION SHALL COMPARE 23 THE TOTAL COSTS OF ENERGY EFFICIENCY AND CONSERVATION PLANS 24 IMPLEMENTED UNDER THIS SECTION TO THE TOTAL SAVINGS IN ENERGY 25 AND CAPACITY COSTS TO RETAIL CUSTOMERS IN THIS COMMONWEALTH. 26 IF THE COMMISSION DETERMINES THAT THE BENEFITS OF THE 27 MEASURES EXCEED THE COSTS, THE COMMISSION SHALL SET 28 ADDITIONAL INCREMENTAL REQUIREMENTS FOR REDUCTION IN PEAK 29 DEMAND FOR THE 100 HOURS OF GREATEST DEMAND OR AN ALTERNATIVE 30 REDUCTION APPROVED BY THE COMMISSION. REDUCTIONS IN 20080H2200B4526 - 25 -
1 CONSUMPTION SHALL BE MEASURED FROM THE ELECTRIC DISTRIBUTION 2 COMPANY'S PEAK DEMAND FOR THE PERIOD FROM JUNE 1, 2011, 3 THROUGH MAY 31, 2012. THE REDUCTIONS IN CONSUMPTION REQUIRED 4 BY THE COMMISSION SHALL BE ACCOMPLISHED NO LATER THAN MAY 31, 5 2017. 6 (E) COMMISSION APPROVAL.--THE COMMISSION SHALL APPROVE OR 7 DISAPPROVE A PLAN FILED UNDER SUBSECTION (B) WITHIN 120 DAYS OF 8 SUBMISSION. THE FOLLOWING SHALL APPLY TO AN ORDER DISAPPROVING A 9 PLAN: 10 (1) THE COMMISSION SHALL DESCRIBE IN DETAIL THE REASONS 11 FOR THE DISAPPROVAL. 12 (2) THE ELECTRIC DISTRIBUTION COMPANY SHALL HAVE 60 DAYS 13 TO FILE A REVISED PLAN TO ADDRESS THE DEFICIENCIES IDENTIFIED 14 BY THE COMMISSION. 15 (F) PENALTIES.-- 16 (1) THE FOLLOWING SHALL APPLY FOR FAILURE TO SUBMIT A 17 PLAN: 18 (I) AN ELECTRIC DISTRIBUTION COMPANY THAT FAILS TO 19 FILE A PLAN UNDER SUBSECTION (B) SHALL BE SUBJECT TO A 20 CIVIL PENALTY OF $100,000 PER DAY UNTIL THE PLAN IS 21 FILED. 22 (II) AN ELECTRIC DISTRIBUTION COMPANY THAT FAILS TO 23 FILE A REVISED PLAN UNDER SUBSECTION (E)(2) SHALL BE 24 SUBJECT TO A CIVIL PENALTY OF $100,000 PER DAY UNTIL THE 25 PLAN IS FILED. 26 (III) PENALTIES COLLECTED UNDER THIS PARAGRAPH SHALL 27 BE DEPOSITED IN THE LOW-INCOME ELECTRIC CUSTOMER 28 ASSISTANCE PROGRAM OF THE ENERGY DISTRIBUTION COMPANY FOR 29 THE RESPECTIVE SERVICE TERRITORY. 30 (2) THE FOLLOWING SHALL APPLY TO AN ELECTRIC 20080H2200B4526 - 26 -
1 DISTRIBUTION COMPANY THAT FAILS TO ACHIEVE THE REDUCTIONS IN 2 CONSUMPTION REQUIRED UNDER SUBSECTION (C) OR (D): 3 (I) THE ELECTRIC DISTRIBUTION COMPANY SHALL BE 4 SUBJECT TO A CIVIL PENALTY OF UP TO $5,000,000 FOR 5 FAILURE TO ACHIEVE THE REQUIRED REDUCTIONS IN CONSUMPTION 6 UNDER SUBSECTION (C) OR (D). ANY PENALTY PAID BY AN 7 ELECTRIC DISTRIBUTION COMPANY UNDER THIS SUBPARAGRAPH 8 SHALL NOT BE RECOVERABLE FROM RATEPAYERS. 9 (II) IF AN ELECTRIC DISTRIBUTION COMPANY FAILS TO 10 ACHIEVE THE REQUIRED REDUCTIONS IN CONSUMPTION UNDER 11 SUBSECTION (C) OR (D) BY 2013, RESPONSIBILITY TO ACHIEVE 12 THE REDUCTIONS IN CONSUMPTION SHALL BE TRANSFERRED TO THE 13 COMMISSION. THE COMMISSION SHALL DO ALL OF THE FOLLOWING: 14 (A) IMPLEMENT A PLAN TO ACHIEVE THE REQUIRED 15 REDUCTIONS IN CONSUMPTION UNDER SUBSECTION (C) OR 16 (D). 17 (B) CONTRACT WITH THIRD-PARTY ENTITIES AS 18 NECESSARY TO IMPLEMENT ANY PORTION OF THE PLAN. 19 (III) THE PROVISIONS OF SUBPARAGRAPH (II) SHALL 20 APPLY IN EACH SUBSEQUENT FIVE-YEAR PERIOD IF THE ELECTRIC 21 DISTRIBUTION COMPANY FAILS TO ACHIEVE THE REDUCTION 22 STANDARDS UNDER SUBSECTION (C) OR (D). 23 (G) LIMITATION ON COSTS.--THE TOTAL COST OF ANY PLAN 24 REQUIRED UNDER THIS SECTION SHALL NOT EXCEED 2% OF THE ELECTRIC 25 DISTRIBUTION COMPANY'S TOTAL ANNUAL REVENUE AS OF DECEMBER 31, 26 2006. NO MORE THAN 1% OF THE 2% OF THE COMPANY'S TOTAL ANNUAL 27 REVENUE MAY BE USED FOR THE ADMINISTRATIVE COSTS OF THE ELECTRIC 28 DISTRIBUTION COMPANY. THE LIMITATION UNDER THIS PARAGRAPH SHALL 29 NOT INCLUDE THE COST OF LOW-INCOME USAGE REDUCTION PROGRAMS 30 ESTABLISHED UNDER 52 PA. CODE CH. 58 (RELATING TO RESIDENTIAL 20080H2200B4526 - 27 -
1 LOW INCOME USAGE REDUCTION PROGRAMS). 2 (H) REPORT.--THE FOLLOWING SHALL APPLY: 3 (1) EACH ELECTRIC DISTRIBUTION COMPANY SHALL SUBMIT AN 4 ANNUAL REPORT TO THE COMMISSION RELATING TO THE RESULTS OF 5 THE ENERGY EFFICIENCY AND CONSERVATION PLAN WITHIN THE 6 ELECTRIC DISTRIBUTION SERVICE TERRITORY. THE REPORT SHALL 7 INCLUDE ALL OF THE FOLLOWING: 8 (I) DOCUMENTATION OF PROGRAM EXPENDITURES. 9 (II) MEASUREMENT AND VERIFICATION OF ENERGY SAVINGS 10 UNDER THE PLAN. 11 (III) EVALUATION OF THE COST-EFFECTIVENESS OF 12 EXPENDITURES. 13 (IV) ANY OTHER INFORMATION REQUIRED BY THE 14 COMMISSION. 15 (2) BEGINNING FIVE YEARS FOLLOWING THE EFFECTIVE DATE OF 16 THIS SECTION AND ANNUALLY THEREAFTER, THE COMMISSION SHALL 17 SUBMIT A REPORT TO THE CONSUMER PROTECTION AND PROFESSIONAL 18 LICENSURE COMMITTEE OF THE SENATE AND THE CONSUMER AFFAIRS 19 COMMITTEE OF THE HOUSE OF REPRESENTATIVES. 20 (I) EXISTING FUNDING SOURCES.--EACH ELECTRIC DISTRIBUTION 21 COMPANY SHALL PROVIDE A LIST OF ALL ELIGIBLE FEDERAL AND STATE 22 FUNDING PROGRAMS. 23 (J) RECOVERY.--IN NO CASE SHALL DECREASED REVENUES OF AN 24 ELECTRIC DISTRIBUTION COMPANY DUE TO REDUCED ENERGY CONSUMPTION 25 OR CHANGES IN ENERGY DEMAND BE CONSIDERED A RECOVERABLE COST. 26 (K) APPLICABILITY.--THIS SECTION SHALL NOT APPLY TO AN 27 ELECTRIC DISTRIBUTION COMPANY WITH FEWER THAN 100,000 CUSTOMERS. 28 (L) DEFINITIONS.--AS USED IN THIS SECTION, THE FOLLOWING 29 WORDS AND PHRASES SHALL HAVE THE MEANINGS GIVEN TO THEM IN THIS 30 SUBSECTION: 20080H2200B4526 - 28 -
1 "ELECTRIC DISTRIBUTION COMPANY TOTAL ANNUAL REVENUE." 2 AMOUNTS PAID TO THE ELECTRIC DISTRIBUTION COMPANY FOR 3 GENERATION, TRANSMISSION, DISTRIBUTION AND SURCHARGES BY RETAIL 4 CUSTOMERS. 5 "ENERGY EFFICIENCY AND CONSERVATION MEASURES." 6 (1) TECHNOLOGIES, MANAGEMENT PRACTICES OR OTHER MEASURES 7 EMPLOYED BY RETAIL CUSTOMERS THAT REDUCE ELECTRICITY 8 CONSUMPTION OR DEMAND IF ALL OF THE FOLLOWING APPLY: 9 (I) THE TECHNOLOGY, PRACTICE OR OTHER MEASURE IS 10 INSTALLED ON OR AFTER THE EFFECTIVE DATE OF THIS SECTION 11 AT THE LOCATION OF A RETAIL CUSTOMER. 12 (II) THE TECHNOLOGY, PRACTICE OR OTHER MEASURE 13 REDUCES CONSUMPTION OF ENERGY BY THE RETAIL CUSTOMER. 14 (III) THE COST OF THE ACQUISITION OR INSTALLATION OF 15 THE MEASURE IS DIRECTLY INCURRED IN WHOLE OR IN PART BY 16 THE ELECTRIC DISTRIBUTION COMPANY. 17 (2) ENERGY EFFICIENCY AND CONSERVATION MEASURES SHALL 18 INCLUDE SOLAR OR SOLAR PHOTOVOLTAIC PANELS, ENERGY EFFICIENT 19 WINDOWS AND DOORS, ENERGY EFFICIENT LIGHTING, INCLUDING EXIT 20 SIGN RETROFIT, HIGH BAY FLUORESCENT RETROFIT AND PEDESTRIAN 21 AND TRAFFIC SIGNAL CONVERSION, GEOTHERMAL HEATING, 22 INSULATION, AIR SEALING, REFLECTIVE ROOF COATINGS, ENERGY 23 EFFICIENT HEATING AND COOLING EQUIPMENT OR SYSTEMS AND ENERGY 24 EFFICIENT APPLIANCES AND OTHER TECHNOLOGIES, PRACTICES OR 25 MEASURES APPROVED BY THE COMMISSION. 26 "PEAK DEMAND." THE HIGHEST ELECTRICAL REQUIREMENT OCCURRING 27 DURING A SPECIFIED PERIOD. FOR AN ELECTRIC DISTRIBUTION COMPANY, 28 THE TERM SHALL MEAN THE SUM OF THE METERED CONSUMPTION FOR ALL 29 RETAIL CUSTOMERS OVER THAT PERIOD. 30 "QUALITY ASSURANCE." ALL OF THE FOLLOWING: 20080H2200B4526 - 29 -
1 (1) THE AUDITING OF BUILDINGS, EQUIPMENT AND PROCESSES 2 TO DETERMINE THE COST-EFFECTIVENESS OF ENERGY EFFICIENCY AND 3 CONSERVATION MEASURES USING NATIONALLY RECOGNIZED TOOLS AND 4 CERTIFICATION PROGRAMS. 5 (2) INDEPENDENT INSPECTION OF COMPLETED ENERGY 6 EFFICIENCY AND CONSERVATION MEASURES COMPLETED BY THIRD-PARTY 7 ENTITIES TO EVALUATE THE QUALITY OF THE COMPLETED MEASURE. 8 "REAL-TIME PRICE." A RATE THAT DIRECTLY REFLECTS THE 9 DIFFERENT COST OF ENERGY DURING EACH HOUR. 10 "THIRD-PARTY ENTITY." AN ENTITY WITH NO DIRECT OR INDIRECT 11 OWNERSHIP, PARTNERSHIP OR OTHER AFFILIATED INTEREST WITH AN 12 ELECTRIC DISTRIBUTION COMPANY. 13 "TIME-OF-USE RATE." A RATE THAT REFLECTS THE COSTS OF 14 SERVING CUSTOMERS DURING DIFFERENT TIME PERIODS, INCLUDING OFF- 15 PEAK AND ON-PEAK PERIODS, BUT NOT AS FREQUENTLY AS EACH HOUR. 16 "TOTAL RESOURCE COST TEST." A STANDARD TEST THAT IS MET IF, 17 OVER THE EFFECTIVE LIFE OF EACH PLAN NOT TO EXCEED FIVE YEARS, 18 THE AVOIDED MONETARY COSTS OF SUPPLYING ELECTRICITY ARE GREATER 19 THAN THE MONETARY COSTS OF ENERGY EFFICIENCY MEASURES AND 20 CONSERVATION OF CONSUMPTION. 21 SECTION 3. SECTION 2807(E) OF TITLE 66 IS AMENDED AND THE 22 SECTION IS AMENDED BY ADDING SUBSECTIONS TO READ: 23 § 2807. DUTIES OF ELECTRIC DISTRIBUTION COMPANIES. 24 * * * 25 (E) OBLIGATION TO SERVE.--[AN ELECTRIC DISTRIBUTION 26 COMPANY'S] A DEFAULT SERVICE PROVIDER'S OBLIGATION TO PROVIDE 27 ELECTRIC GENERATION SUPPLY SERVICE FOLLOWING [IMPLEMENTATION OF 28 RESTRUCTURING AND THE CHOICE OF ALTERNATIVE GENERATION BY A 29 CUSTOMER] THE EXPIRATION OF A GENERATION RATE CAP SPECIFIED 30 UNDER SECTION 2804(4) (RELATING TO STANDARDS FOR RESTRUCTURING 20080H2200B4526 - 30 -
1 OF ELECTRIC INDUSTRY) OR A RESTRUCTURING PLAN UNDER SECTION 2 2806(F) (RELATING TO IMPLEMENTATION, PILOT PROGRAMS AND 3 PERFORMANCE-BASED RATES) IS REVISED AS FOLLOWS: 4 (1) WHILE AN ELECTRIC DISTRIBUTION COMPANY COLLECTS 5 EITHER A COMPETITIVE TRANSITION CHARGE OR AN INTANGIBLE 6 TRANSITION CHARGE OR UNTIL 100% OF ITS CUSTOMERS HAVE CHOICE, 7 WHICHEVER IS LONGER, THE ELECTRIC DISTRIBUTION COMPANY SHALL 8 CONTINUE TO HAVE THE FULL OBLIGATION TO SERVE, INCLUDING THE 9 CONNECTION OF CUSTOMERS, THE DELIVERY OF ELECTRIC ENERGY AND 10 THE PRODUCTION OR ACQUISITION OF ELECTRIC ENERGY FOR 11 CUSTOMERS. 12 [(2) AT THE END OF THE TRANSITION PERIOD, THE COMMISSION 13 SHALL PROMULGATE REGULATIONS TO DEFINE THE ELECTRIC 14 DISTRIBUTION COMPANY'S OBLIGATION TO CONNECT AND DELIVER AND 15 ACQUIRE ELECTRICITY UNDER PARAGRAPH (3) THAT WILL EXIST AT 16 THE END OF THE PHASE-IN PERIOD. 17 (3) IF A CUSTOMER CONTRACTS FOR ELECTRIC ENERGY AND IT 18 IS NOT DELIVERED OR IF A CUSTOMER DOES NOT CHOOSE AN 19 ALTERNATIVE ELECTRIC GENERATION SUPPLIER, THE ELECTRIC 20 DISTRIBUTION COMPANY OR COMMISSION-APPROVED ALTERNATIVE 21 SUPPLIER SHALL ACQUIRE ELECTRIC ENERGY AT PREVAILING MARKET 22 PRICES TO SERVE THAT CUSTOMER AND SHALL RECOVER FULLY ALL 23 REASONABLE COSTS.] 24 (3.1) (I) FOLLOWING THE EXPIRATION OF AN ELECTRIC 25 DISTRIBUTION COMPANY'S OBLIGATION TO PROVIDE ELECTRIC 26 GENERATION SUPPLY SERVICE TO RETAIL CUSTOMERS AT CAPPED 27 RATES, IF A CUSTOMER CONTRACTS FOR ELECTRIC GENERATION 28 SUPPLY SERVICE AND THE CHOSEN ELECTRIC GENERATION 29 SUPPLIER DOES NOT PROVIDE THE SERVICE OR IF A CUSTOMER 30 DOES NOT CHOOSE AN ALTERNATIVE ELECTRIC GENERATION 20080H2200B4526 - 31 -
1 SUPPLIER, THE DEFAULT SERVICE PROVIDER SHALL PROVIDE 2 ELECTRIC GENERATION SUPPLY SERVICE TO THAT CUSTOMER 3 PURSUANT TO A COMMISSION-APPROVED COMPETITIVE PROCUREMENT 4 PLAN. THE ELECTRIC POWER ACQUIRED SHALL BE PROCURED 5 THROUGH COMPETITIVE PROCUREMENT PROCESSES AND SHALL 6 INCLUDE ONE OR MORE OF THE FOLLOWING: 7 (A) AUCTIONS. 8 (B) REQUESTS FOR PROPOSAL. 9 (C) BILATERAL AGREEMENTS ENTERED INTO AT THE 10 SOLE DISCRETION OF THE DEFAULT SERVICE PROVIDER WHICH 11 SHALL BE AT PRICES WHICH ARE: 12 (I) NO GREATER THAN THE COST OF OBTAINING 13 GENERATION UNDER COMPARABLE TERMS IN THE 14 WHOLESALE MARKET, AS DETERMINED BY THE COMMISSION 15 AT THE TIME OF EXECUTION OF THE CONTRACT; OR 16 (II) CONSISTENT WITH A COMMISSION-APPROVED 17 COMPETITION PROCUREMENT PROCESS. ANY AGREEMENT 18 BETWEEN AFFILIATED PARTIES SHALL BE SUBJECT TO 19 REVIEW AND APPROVAL OF THE PENNSYLVANIA PUBLIC 20 UTILITY COMMISSION UNDER CHAPTER 21 (RELATING TO 21 RELATIONS WITH AFFILIATED INTERESTS). IN NO CASE 22 SHALL THE COST OF OBTAINING GENERATION FROM ANY 23 AFFILIATED INTEREST BE GREATER THAN THE COST OF 24 OBTAINING GENERATION UNDER COMPARABLE TERMS IN 25 THE WHOLESALE MARKET AT THE TIME OF EXECUTION OF 26 THE CONTRACT. 27 (II) THE PROVISIONS OF THIS PARAGRAPH SHALL APPLY TO 28 ANY TYPE OF FUEL PURCHASED BY A DEFAULT SERVICE PROVIDER 29 TO PROVIDE ELECTRIC GENERATION SUPPLY SERVICE, INCLUDING 30 FUEL REQUIRED TO BE PURCHASED UNDER THE ACT OF NOVEMBER 20080H2200B4526 - 32 -
1 30, 2004 (P.L.1672, NO.213), KNOWN AS THE ALTERNATIVE 2 ENERGY PORTFOLIO STANDARDS ACT. 3 (3.2) THE ELECTRIC POWER PROCURED PURSUANT TO PARAGRAPH 4 (3.1) SHALL INCLUDE A PRUDENT MIX OF THE FOLLOWING: 5 (I) SPOT MARKET PURCHASES. 6 (II) SHORT-TERM CONTRACTS. 7 (III) LONG-TERM PURCHASE CONTRACTS, ENTERED INTO AS 8 A RESULT OF AN AUCTION, REQUEST FOR PROPOSAL OR BILATERAL 9 CONTRACT THAT IS FREE OF UNDUE INFLUENCE, DURESS OR 10 FAVORITISM, OF NOT LESS THAN THREE AND NOT MORE THAN 20 11 YEARS, UNLESS THE COMMISSION DETERMINES A LONGER TERM IS 12 NECESSARY FOR THE RELIABILITY IN THE ACQUISITION OF 13 GENERATION AND IT IS IN THE BEST INTEREST OF CONSUMERS TO 14 EXTEND THE TERM OF THE CONTRACT BEYOND 20 YEARS. THE 15 DEFAULT SERVICE PROVIDER SHALL HAVE SOLE DISCRETION TO 16 DETERMINE THE SOURCE, FUEL TYPE AND LENGTH OF CONTRACT. 17 (3.3) THE PRUDENT MIX OF CONTRACTS ENTERED INTO PURSUANT 18 TO PARAGRAPH (3.2) SHALL BE DESIGNED TO ENSURE: 19 (I) ADEQUATE AND RELIABLE SERVICE. 20 (II) THE LEAST COST TO CUSTOMERS OVER TIME. 21 (III) COMPLIANCE WITH THE REQUIREMENTS OF PARAGRAPH 22 (3.1). 23 (3.4) THE DEFAULT SERVICE PROVIDER SHALL FILE A PLAN FOR 24 COMPETITIVE PROCUREMENT WITH THE COMMISSION AND OBTAIN 25 COMMISSION APPROVAL OF THE PLAN CONSIDERING THE STANDARDS IN 26 PARAGRAPHS (3.1), (3.2) AND (3.3) BEFORE THE COMPETITIVE 27 PROCESS IS IMPLEMENTED. THE COMMISSION SHALL HOLD HEARINGS AS 28 NECESSARY ON THE PROPOSED PLAN. IF THE COMMISSION FAILS TO 29 ISSUE A FINAL ORDER ON THE PLAN WITHIN NINE MONTHS OF THE 30 DATE THAT THE PLAN IS FILED, THE PLAN SHALL BE DEEMED TO BE 20080H2200B4526 - 33 -
1 APPROVED AND THE DEFAULT SERVICE PROVIDER MAY IMPLEMENT THE 2 PLAN AS FILED. COSTS INCURRED THROUGH AN APPROVED COMPETITIVE 3 PROCUREMENT PLAN SHALL BE DEEMED TO BE THE LEAST COST OVER 4 TIME AS REQUIRED UNDER PARAGRAPH (3.3). 5 (3.5) AT THE TIME THE COMMISSION EVALUATES THE PLAN AND 6 PRIOR TO APPROVAL, IN DETERMINING IF THE DEFAULT ELECTRIC 7 SERVICE PROVIDER'S PLAN OBTAINS GENERATION SUPPLY AT THE 8 LEAST COST, THE COMMISSION SHALL CONSIDER THE DEFAULT SERVICE 9 PROVIDER'S OBLIGATION TO PROVIDE ADEQUATE AND RELIABLE 10 SERVICE TO THE CUSTOMERS AND THAT THE DEFAULT SERVICE 11 PROVIDER HAS OBTAINED A PRUDENT MIX OF CONTRACTS TO OBTAIN 12 LEAST COST ON LONG-TERM, SHORT-TERM AND SPOT MARKET BASIS AND 13 SHALL MAKE SPECIFIC FINDINGS WHICH SHALL INCLUDE THE 14 FOLLOWING: 15 (I) THE DEFAULT SERVICE PROVIDER'S PLAN INCLUDES 16 PRUDENT STEPS NECESSARY TO NEGOTIATE FAVORABLE GENERATION 17 SUPPLY CONTRACTS. 18 (II) THE DEFAULT SERVICE PROVIDER'S PLAN INCLUDES 19 PRUDENT STEPS NECESSARY TO OBTAIN LEAST COST GENERATION 20 SUPPLY CONTRACTS ON A LONG-TERM, SHORT-TERM AND SPOT 21 MARKET BASIS. 22 (III) NEITHER THE DEFAULT SERVICE PROVIDER NOR ITS 23 AFFILIATED INTEREST HAS WITHHELD OR ASKED TO WITHHOLD 24 FROM THE MARKET ANY GENERATION SUPPLY WHICH SHOULD HAVE 25 BEEN UTILIZED AS PART OF THE LEAST COST PROCUREMENT 26 POLICY. 27 (3.6) NOTWITHSTANDING SECTIONS 508 (RELATING TO POWER OF 28 COMMISSION TO VARY, REFORM AND REVISE CONTRACTS) AND 2102 29 (RELATING TO APPROVAL OF CONTRACTS WITH AFFILIATED 30 INTERESTS), THE COMMISSION SHALL NOT MODIFY CONTRACTS OR 20080H2200B4526 - 34 -
1 DISALLOW COSTS ASSOCIATED WITH AN APPROVED PROCUREMENT 2 PROCESS WHEN IT HAS REVIEWED AND APPROVED THE RESULTS OF THE 3 PROCUREMENT. 4 (3.7) NOTWITHSTANDING ANY OTHER PROVISION OF THIS TITLE 5 TO THE CONTRARY, THE COMMISSION MAY MODIFY CONTRACTS OR 6 DISALLOW COSTS WHEN THE PARTY SEEKING RECOVERY OF THE COSTS 7 IS AT FAULT ASSOCIATED WITH CONTRACTS ENTERED INTO PURSUANT 8 TO A COMMISSION-APPROVED PROCUREMENT PLAN IF THE COMMISSION 9 DETERMINES AFTER A HEARING THAT: 10 (I) THE CONTRACT HAS NOT BEEN IMPLEMENTED OR 11 APPROVED OR DOES NOT COMPLY WITH THE COMMISSION-APPROVED 12 PROCUREMENT PLAN; OR 13 (II) THERE HAS BEEN FRAUD, COLLUSION OR MARKET 14 MANIPULATION WITH REGARD TO THESE CONTRACTS. 15 (3.8) THE DEFAULT SERVICE PROVIDER SHALL HAVE THE RIGHT 16 TO RECOVER ON A FULL AND CURRENT BASIS, PURSUANT TO A 17 RECONCILABLE AUTOMATIC ADJUSTMENT CLAUSE UNDER SECTION 1307 18 (RELATING TO SLIDING SCALE OF RATES; ADJUSTMENTS), ALL COSTS 19 INCURRED UNDER THIS SECTION AND A COMMISSION-APPROVED 20 COMPETITIVE PROCUREMENT PLAN. 21 (4) IF A CUSTOMER THAT CHOOSES AN ALTERNATIVE SUPPLIER 22 AND SUBSEQUENTLY DESIRES TO RETURN TO THE LOCAL DISTRIBUTION 23 COMPANY FOR GENERATION SERVICE, THE LOCAL DISTRIBUTION 24 COMPANY SHALL TREAT THAT CUSTOMER EXACTLY AS IT WOULD ANY NEW 25 APPLICANT FOR ENERGY SERVICE. 26 (5) (I) NOTWITHSTANDING PARAGRAPH [(3)] (3.1), THE 27 ELECTRIC DISTRIBUTION COMPANY OR COMMISSION-APPROVED 28 ALTERNATIVE SUPPLIER MAY, IN ITS SOLE DISCRETION, OFFER 29 LARGE CUSTOMERS WITH A PEAK DEMAND OF 15 MEGAWATTS OR 30 GREATER AT ONE METER AT A LOCATION IN ITS SERVICE 20080H2200B4526 - 35 -
1 TERRITORY ANY NEGOTIATED RATE FOR SERVICE AT ALL OF THE 2 CUSTOMERS' LOCATIONS WITHIN THE SERVICE TERRITORY FOR ANY 3 DURATION AGREED UPON BY THE ELECTRIC DISTRIBUTION COMPANY 4 OR COMMISSION-APPROVED ALTERNATIVE SUPPLIER AND THE LARGE 5 CUSTOMER. THE COMMISSION SHALL PERMIT, BUT SHALL NOT 6 REQUIRE, AN ELECTRIC DISTRIBUTION COMPANY OR COMMISSION- 7 APPROVED ALTERNATIVE SUPPLIER TO PROVIDE SERVICE TO LARGE 8 CUSTOMERS UNDER THIS PARAGRAPH. CONTRACT RATES ENTERED 9 INTO UNDER THIS PARAGRAPH SHALL BE SUBJECT TO REVIEW BY 10 THE COMMISSION IN ORDER TO ENSURE THAT ALL COSTS RELATED 11 TO THE RATES ARE BORNE BY THE PARTIES TO THE CONTRACT AND 12 THAT NO COSTS RELATED TO THE RATES ARE BORNE BY OTHER 13 CUSTOMERS OR CUSTOMER CLASSES. IF NO COSTS RELATED TO THE 14 RATES ARE BORNE BY OTHER CUSTOMERS OR CUSTOMER CLASSES, 15 THE COMMISSION SHALL APPROVE THE CONTRACT WITHIN 90 DAYS 16 OF ITS FILING, OR IT SHALL BE DEEMED APPROVED BY 17 OPERATION OF LAW UPON EXPIRATION OF THE 90 DAYS. 18 INFORMATION SUBMITTED UNDER THIS PARAGRAPH SHALL BE 19 SUBJECT TO THE COMMISSION'S PROCEDURES FOR THE FILING OF 20 CONFIDENTIAL AND PROPRIETARY INFORMATION. 21 (II) FOR PURPOSES OF PROVIDING SERVICE UNDER THIS 22 PARAGRAPH TO CUSTOMERS WITH A PEAK DEMAND OF 20 MEGAWATTS 23 OR GREATER AT ONE METER AT A LOCATION WITHIN THAT 24 DISTRIBUTION COMPANY'S SERVICE TERRITORY, AN ELECTRIC 25 DISTRIBUTION COMPANY THAT HAS COMPLETED ITS RESTRUCTURING 26 TRANSITION PERIOD AS OF THE EFFECTIVE DATE OF THIS 27 PARAGRAPH MAY, IN ITS SOLE DISCRETION, ACQUIRE AN 28 INTEREST IN A GENERATION FACILITY OR CONSTRUCT A 29 GENERATION FACILITY SPECIFICALLY TO MEET THE ENERGY 30 REQUIREMENTS OF THE CUSTOMERS, INCLUDING THE ELECTRIC 20080H2200B4526 - 36 -
1 REQUIREMENTS OF THE CUSTOMERS' OTHER BILLING LOCATIONS 2 WITHIN ITS SERVICE TERRITORY. THE ELECTRIC DISTRIBUTION 3 COMPANY MUST COMMENCE CONSTRUCTION OF THE GENERATION 4 FACILITY OR CONTRACT TO ACQUIRE THE GENERATION INTEREST 5 WITHIN THREE YEARS AFTER THE EFFECTIVE DATE OF THIS 6 PARAGRAPH, EXCEPT THAT THE ELECTRIC DISTRIBUTION COMPANY 7 MAY ADD TO THE GENERATION FACILITIES IT COMMENCED 8 CONSTRUCTION OR CONTRACTED TO ACQUIRE AFTER THIS THREE- 9 YEAR PERIOD TO SERVE ADDITIONAL LOAD OF CUSTOMERS FOR 10 WHOM IT COMMENCED CONSTRUCTION OR CONTRACTED TO ACQUIRE 11 GENERATION WITHIN THREE YEARS. NOTHING IN THIS PARAGRAPH 12 REQUIRES OR AUTHORIZES THE COMMISSION TO REQUIRE AN 13 ELECTRIC DISTRIBUTION COMPANY TO COMMENCE CONSTRUCTION OR 14 ACQUIRE AN INTEREST IN A GENERATION FACILITY. THE 15 ELECTRIC DISTRIBUTION COMPANY'S INTEREST IN THE 16 GENERATION FACILITY IT BUILT OR CONTRACTED TO ACQUIRE 17 SHALL BE NO LARGER THAN NECESSARY TO MEET PEAK DEMAND OF 18 CUSTOMERS SERVED UNDER THIS SUBPARAGRAPH. DURING TIMES 19 WHEN THE CUSTOMER'S DEMAND IS LESS THAN THE ELECTRIC 20 DISTRIBUTION COMPANY'S GENERATION INTEREST, THE ELECTRIC 21 DISTRIBUTION COMPANY MAY SELL EXCESS POWER ON THE 22 WHOLESALE MARKET. AT NO TIME SHALL THE COSTS ASSOCIATED 23 WITH THE GENERATING FACILITY INTERESTS BE INCLUDED IN 24 RATE BASE OR OTHERWISE REFLECTED IN RATES. THE GENERATION 25 FACILITY INTERESTS SHALL NOT BE COMMISSION-REGULATED 26 ASSETS. 27 (6) A DEFAULT SERVICE PLAN APPROVED BY THE COMMISSION 28 PRIOR TO THE EFFECTIVE DATE OF THIS SECTION SHALL REMAIN IN 29 EFFECT THROUGH ITS APPROVED TERM. AT ITS SOLE DISCRETION, THE 30 DEFAULT SERVICE PROVIDER MAY PROPOSE AMENDMENTS TO ITS 20080H2200B4526 - 37 -
1 APPROVED PLAN THAT ARE CONSISTENT WITH THIS SECTION, AND THE 2 COMMISSION SHALL ISSUE A DECISION WHETHER TO APPROVE OR 3 DISAPPROVE THE PROPOSED AMENDMENTS WITHIN NINE MONTHS OF THE 4 DATE THAT THE AMENDMENTS ARE FILED. IF THE COMMISSION FAILS 5 TO ISSUE A FINAL ORDER WITHIN NINE MONTHS, THE AMENDMENTS 6 SHALL BE DEEMED TO BE APPROVED AND THE DEFAULT SERVICE 7 PROVIDER MAY IMPLEMENT THE AMENDMENTS AS FILED. 8 (7) THE DEFAULT SERVICE PROVIDER SHALL OFFER RESIDENTIAL 9 AND SMALL BUSINESS CUSTOMERS A GENERATION SUPPLY SERVICE RATE 10 THAT SHALL CHANGE NO MORE FREQUENTLY THAN ON A QUARTERLY 11 BASIS. ALL DEFAULT SERVICE RATES SHALL BE REVIEWED BY THE 12 COMMISSION TO ENSURE THAT THE COSTS OF PROVIDING SERVICE TO 13 EACH CUSTOMER CLASS ARE NOT SUBSIDIZED BY ANY OTHER CLASS. 14 (F) SMART METER TECHNOLOGY AND TIME OF USE RATES.-- 15 (1) WITHIN NINE MONTHS AFTER THE EFFECTIVE DATE OF THIS 16 PARAGRAPH, ELECTRIC DISTRIBUTION COMPANIES SHALL FILE A SMART 17 METER TECHNOLOGY PROCUREMENT AND INSTALLATION PLAN WITH THE 18 COMMISSION FOR APPROVAL. THE PLAN SHALL DESCRIBE THE SMART 19 METER TECHNOLOGIES THE ELECTRIC DISTRIBUTION COMPANY PROPOSES 20 TO INSTALL IN ACCORDANCE WITH PARAGRAPH (2). 21 (2) ELECTRIC DISTRIBUTION COMPANIES SHALL FURNISH SMART 22 METER TECHNOLOGY AS FOLLOWS: 23 (I) UPON REQUEST TO A CUSTOMER THAT AGREES TO PAY 24 THE COST OF THE SMART METER. 25 (II) IN THE CONSTRUCTION OF A NEW RESIDENCE OR NEW 26 BUILDING TO BE USED BY A COMMERCIAL CUSTOMER. 27 (III) IN ACCORDANCE WITH A SCHEDULE OF REPLACEMENT 28 OF FULL DEPRECIATION OF EXISTING METERS. 29 (3) ELECTRIC DISTRIBUTION COMPANIES SHALL, WITH CUSTOMER 30 CONSENT, MAKE AVAILABLE ELECTRONIC ACCESS TO CUSTOMER METER 20080H2200B4526 - 38 -
1 DATA TO THIRD PARTIES, INCLUDING ELECTRIC GENERATION 2 SUPPLIERS AND PROVIDERS OF CONSERVATION AND LOAN MANAGEMENT 3 SERVICES. 4 (4) AN ELECTRIC DISTRIBUTION COMPANY SHALL NOT BE 5 PERMITTED TO RECOVER THE COSTS, AS DETERMINED BY THE 6 COMMISSION, OF PROVIDING SMART METER TECHNOLOGY UNDER 7 PARAGRAPH (2). 8 (5) IN NO EVENT SHALL LOST OR DECREASED REVENUES BY AN 9 ELECTRIC DISTRIBUTION COMPANY DUE TO REDUCED ELECTRICITY 10 CONSUMPTION OR SHIFTING ENERGY DEMAND BE CONSIDERED A COST OF 11 SMART METER TECHNOLOGY. 12 (6) BY JANUARY 1, 2010, OR AT THE END OF THE APPLICABLE 13 GENERATION RATE CAP PERIOD, WHICHEVER IS LATER, A DEFAULT 14 SERVICE PROVIDER SHALL SUBMIT TO THE COMMISSION ONE OR MORE 15 PROPOSED TIME-OF-USE RATES AND REAL-TIME PRICE PLANS. THE 16 COMMISSION SHALL APPROVE OR MODIFY THE TIME-OF-USE RATES AND 17 REAL-TIME PRICE PLAN WITHIN SIX MONTHS OF SUBMITTAL. THE 18 DEFAULT SERVICE PROVIDER SHALL OFFER THE RATES AND REAL-TIME 19 PRICE PLAN TO ALL RESIDENTIAL AND COMMERCIAL CUSTOMERS THAT 20 HAVE BEEN PROVIDED WITH SMART METER TECHNOLOGY WITHIN 60 DAYS 21 OF INSTALLATION OF THE SMART METER TECHNOLOGY OR COMMISSION 22 APPROVAL OF THE TIME-OF-USE RATES AND REAL-TIME PRICE PLAN, 23 WHICHEVER IS LATER. RESIDENTIAL OR COMMERCIAL CUSTOMERS MAY 24 ELECT TO PARTICIPATE IN TIME-OF-USE RATES OR REAL-TIME 25 PRICING. THE DEFAULT SERVICE PROVIDER SHALL SUBMIT AN ANNUAL 26 REPORT TO THE COMMISSION ON THE PARTICIPATION IN THE TIME-OF- 27 USE AND REAL-TIME PRICE PROGRAMS AND THE EFFICACY OF THE 28 PROGRAMS IN AFFECTING ENERGY DEMAND AND CONSUMPTION AND THE 29 EFFECT ON WHOLESALE MARKET PRICES. 30 (7) THE PROVISIONS OF THIS SUBSECTION SHALL NOT APPLY TO 20080H2200B4526 - 39 -
1 AN ELECTRIC DISTRIBUTION COMPANY WITH 100,000 OR FEWER 2 CUSTOMERS. 3 (G) DEFINITION.--AS USED IN THIS SECTION, THE TERM "SMART 4 METER TECHNOLOGY" MEANS TECHNOLOGY, INCLUDING METERING 5 TECHNOLOGY AND NETWORK COMMUNICATIONS TECHNOLOGY CAPABLE OF 6 BIDIRECTIONAL COMMUNICATION, THAT RECORDS ELECTRICITY USAGE ON 7 AT LEAST AN HOURLY BASIS, INCLUDING RELATED ELECTRIC 8 DISTRIBUTION SYSTEM UPGRADES TO ENABLE THE TECHNOLOGY. THE 9 TECHNOLOGY SHALL PROVIDE CUSTOMERS WITH DIRECT ACCESS TO AND USE 10 OF PRICE AND CONSUMPTION INFORMATION. THE TECHNOLOGY SHALL ALSO: 11 (1) DIRECTLY PROVIDE CUSTOMERS WITH INFORMATION ON THEIR 12 HOURLY CONSUMPTION. 13 (2) ENABLE TIME-OF-USE RATES AND REAL-TIME PRICE 14 PROGRAMS. 15 (3) EFFECTIVELY SUPPORT THE AUTOMATIC CONTROL OF THE 16 CUSTOMER'S ELECTRICITY CONSUMPTION BY ONE OR MORE OF THE 17 FOLLOWING AS SELECTED BY THE CUSTOMER: 18 (I) THE CUSTOMER; 19 (II) THE CUSTOMER'S UTILITY; OR 20 (III) A THIRD PARTY ENGAGED BY THE CUSTOMER OR THE 21 CUSTOMER'S UTILITY. 22 (4) PROVIDE A MEANS TO OBTAIN REAL-TIME CONSUMPTION 23 INFORMATION FROM A METER SUCH AS AN INSTALLED PORT OR OUTPUT 24 FOR TRANSMITTING METER PULSE DATA EXTERNAL TO THE METER TO BE 25 USED BY THE CUSTOMER, THE ELECTRIC DISTRIBUTION COMPANY OR A 26 THIRD PARTY ENGAGED BY THE CUSTOMER IN THE ELECTRIC 27 DISTRIBUTION COMPANY. 28 SECTION 4. TITLE 66 IS AMENDED BY ADDING A SECTION TO READ: 29 § 2813. PROCUREMENT OF POWER. 30 EXCEPT AS PROVIDED UNDER THE ACT OF NOVEMBER 30, 2004 20080H2200B4526 - 40 -
1 (P.L.1672, NO.213), KNOWN AS THE ALTERNATIVE ENERGY PORTFOLIO 2 STANDARDS ACT, THE COMMISSION MAY NOT ORDER A DEFAULT SERVICE 3 PROVIDER TO PROCURE POWER FROM A SPECIFIC GENERATION SUPPLIER, 4 FROM A SPECIFIC GENERATION FUEL TYPE OR FROM NEW GENERATION 5 ONLY. 6 SECTION 5. THIS ACT SHALL TAKE EFFECT IN 60 DAYS. 7 SECTION 1. SECTION 305(A) OF TITLE 66 OF THE PENNSYLVANIA <-- 8 CONSOLIDATED STATUTES IS AMENDED TO READ: 9 § 305. DIRECTOR OF OPERATIONS, SECRETARY, EMPLOYEES AND 10 CONSULTANTS. 11 (A) DIRECTOR OF OPERATIONS.--THE COMMISSION MAY APPOINT A 12 DIRECTOR OF OPERATIONS WHO SHALL SERVE AT THE PLEASURE OF THE 13 COMMISSION AND SHALL BE RESPONSIBLE FOR THE DAY-TO-DAY 14 ADMINISTRATION AND OPERATION OF THE BUREAUS AND OFFICES OF THE 15 COMMISSION, EXCEPT THAT THE DIRECTOR OF OPERATIONS SHALL HAVE 16 RESPONSIBILITY FOR THE [OFFICE OF TRIAL STAFF] PROSECUTORIAL 17 FUNCTION ONLY WITH REGARD TO ADMINISTRATIVE MATTERS. 18 * * * 19 SECTION 1.1. SECTION 306 OF TITLE 66 IS REPEALED: 20 [§ 306. OFFICE OF TRIAL STAFF. 21 (A) GENERAL RULE.--THE OFFICE OF TRIAL STAFF TO THE 22 PENNSYLVANIA PUBLIC UTILITY COMMISSION IS HEREBY CREATED. THE 23 DIRECTOR OF TRIAL STAFF, WHO SHALL BE THE CHIEF PROSECUTOR OF 24 THE COMMISSION, SHALL BE APPOINTED BY THE COMMISSION AND HOLD 25 OFFICE AT ITS PLEASURE. THE COMMISSION SHALL ASSIGN A PERMANENT 26 STAFF OF SUCH LEGAL, TECHNICAL AND OTHER EMPLOYEES OF THE 27 COMMISSION AS MAY BE REQUIRED FOR THE PROPER CONDUCT OF THE WORK 28 OF THE OFFICE OF TRIAL STAFF. EMPLOYEES ASSIGNED TO THE OFFICE 29 OF TRIAL STAFF SHALL BE UNDER THE SUPERVISION OF THE DIRECTOR OF 30 TRIAL STAFF AND SHALL NOT BE ASSIGNED TO ANY DUTIES OTHER THAN 20080H2200B4526 - 41 -
1 WITH THE OFFICE OF TRIAL STAFF, EXCEPT AS THE COMMISSION MAY ON 2 A TEMPORARY CASE-BY-CASE BASIS PERMIT WHERE THE PERFORMANCE OF 3 SUCH OTHER DUTIES WILL NOT REPRESENT, OR CREATE THE APPEARANCE 4 OF, A CONFLICT OF INTEREST. THE COMMISSION MAY DESIGNATE 5 EMPLOYEES OF THE OFFICE OF TRIAL STAFF TO SERVE AS DEPUTIES TO 6 THE DIRECTOR OF TRIAL STAFF. THE DIRECTOR OF TRIAL STAFF MAY 7 RECOMMEND PERSONS FOR CONSIDERATION BY THE COMMISSION AS 8 EMPLOYEES UNDER HIS SUPERVISION. ATTORNEYS ASSIGNED TO THE 9 OFFICE OF TRIAL STAFF MAY BE REMOVED BY THE COMMISSION ONLY FOR 10 GOOD CAUSE. THE COMPENSATION OF THE DIRECTOR OF TRIAL STAFF AND 11 THE EMPLOYEES UNDER HIS SUPERVISION SHALL BE FIXED BY THE 12 COMMISSION. THE DIRECTOR OF TRIAL STAFF SHALL REPORT AND BE 13 RESPONSIBLE DIRECTLY TO THE COMMISSION, PROVIDED THAT THE 14 DIRECTOR OF TRIAL STAFF SHALL BE RESPONSIBLE TO THE COMMISSION 15 THROUGH THE DIRECTOR OF OPERATIONS ONLY FOR PURPOSES OF 16 ADMINISTRATIVE MATTERS. 17 (B) POWER AND DUTIES.-- 18 (1) THE OFFICE OF TRIAL STAFF SHALL BE RESPONSIBLE FOR 19 AND SHALL ASSIST IN THE DEVELOPMENT OF, CHALLENGE OF AND 20 REPRESENTATION ON THE RECORD OF ALL MATTERS IN THE PUBLIC 21 INTEREST IN ALL COMMISSION PROCEEDINGS EXCEPT THOSE INVOLVING 22 TRANSPORTATION, SAFETY, EMINENT DOMAIN, SITING, SERVICE 23 ISSUES HAVING NO IMPACT ON RATES AND ABILITY TO PAY, PROVIDED 24 THAT THE DIRECTOR OF TRIAL STAFF MAY PETITION THE COMMISSION 25 OR MAY BE DIRECTED BY THE COMMISSION TO INTERVENE TO PROTECT 26 THE PUBLIC INTEREST IN ANY PROCEEDING INVOLVING 27 TRANSPORTATION, SAFETY, EMINENT DOMAIN, SITING, SERVICE 28 ISSUES HAVING NO IMPACT ON RATES AND ABILITY TO PAY. TO 29 ASSIST IN CARRYING OUT HIS POWERS AND DUTIES UNDER THIS 30 SECTION, THE DIRECTOR OF TRIAL STAFF SHALL SUPERVISE THE 20080H2200B4526 - 42 -
1 ACTIVITIES OF THE OFFICE OF TRIAL STAFF IN ALL COMMISSION 2 PROCEEDINGS IN WHICH HE PARTICIPATES. IF THE DIRECTOR OF 3 TRIAL STAFF IS OF THE OPINION THAT THE INITIATION OF A 4 PROCEEDING IS NECESSARY TO PROTECT THE PUBLIC INTEREST, HE 5 SHALL REQUEST THAT THE COMMISSION INITIATE THE APPROPRIATE 6 PROCEEDING. WHEN HE PARTICIPATES IN A COMMISSION PROCEEDING, 7 IT SHALL BE THE DUTY AND RESPONSIBILITY OF THE DIRECTOR OF 8 TRIAL STAFF TO PROSECUTE IN THAT PROCEEDING. 9 (2) IN ADDITION TO ANY OTHER RESPONSIBILITY CONVEYED 10 UPON IT BY THE COMMISSION, THE OFFICE OF TRIAL STAFF SHALL 11 SUBMIT A REPORT TO THE COMMISSION RECOMMENDING WHETHER THE 12 COMMISSION SHOULD ENTER UPON A HEARING IN ORDER TO 13 INVESTIGATE THE JUSTNESS AND REASONABLENESS OF A TARIFF FILED 14 PURSUANT TO SECTION 1308 (RELATING TO VOLUNTARY CHANGES IN 15 RATES), TO SUSPEND THE EFFECTIVENESS OF SUCH TARIFF, TO ALLOW 16 SUCH TARIFF TO BE SUSPENDED BY OPERATION OF LAW OR TO ALLOW 17 TEMPORARY RATES PURSUANT TO SECTION 1310 (RELATING TO 18 TEMPORARY RATES). THE REPORT: 19 (I) SHALL RECOMMEND ONLY THE INITIAL ACTION WHICH 20 THE COMMISSION SHOULD TAKE AND SHALL NOT CONTAIN AN 21 OPINION AS TO THE PORTION OF A PROPOSED RATE INCREASE 22 WHICH APPEARS TO BE JUST AND REASONABLE, UNLESS THE 23 REPORT INCLUDES A FINDING THAT THE PROPOSED RATE INCREASE 24 APPEARS TO BE JUST AND REASONABLE IN ITS ENTIRETY; 25 (II) SHALL BE RELEASED TO THE PUBLIC IF THE REPORT 26 RECOMMENDS THAT NO HEARINGS NEED TO BE HELD REGARDING THE 27 PROPOSED TARIFF OR THAT THE PROPOSED TARIFF SHOULD NOT BE 28 SUSPENDED, AND MAY BE RELEASED TO THE PUBLIC IN OTHER 29 CIRCUMSTANCES WHEN, IN THE OPINION OF THE COMMISSION, 30 SUCH RELEASE WOULD BE IN THE PUBLIC INTEREST; 20080H2200B4526 - 43 -
1 (III) SHALL BE CONSIDERED ONLY AS AN INDICATION OF 2 THE OFFICE OF TRIAL STAFF'S OPINION REGARDING WHETHER 3 THERE SHOULD BE A HEARING ON THE PROPOSED TARIFF OR 4 WHETHER THE PROPOSED TARIFF SHOULD BE SUSPENDED; AND 5 (IV) SHALL NOT BE CONSIDERED AS EVIDENCE OF THE 6 OFFICE OF TRIAL STAFF'S OPINION REGARDING THE JUSTNESS 7 AND REASONABLENESS OF ANY PROPOSED TARIFF IN ANY 8 SUBSEQUENT COMMISSION PROCEEDING. 9 (3) EXCEPT FOR THE DUTIES SET OUT IN PARAGRAPH (2), 10 NEITHER THE DIRECTOR OF TRIAL STAFF NOR ANY EMPLOYEE WHOM THE 11 DIRECTOR OF TRIAL STAFF SUPERVISES SHALL COMMUNICATE WITH THE 12 COMMISSION, AN ADMINISTRATIVE LAW JUDGE OR ANY OTHER EMPLOYEE 13 OF THE COMMISSION WHO IS DECIDING OR ADVISING IN THE DECISION 14 IN AN ON-THE-RECORD PROCEEDING, WHETHER CONTESTED OR 15 UNCONTESTED, AS DEFINED IN SECTION 332(C) (RELATING TO 16 PROCEDURES IN GENERAL), EXCEPT THROUGH THE PRACTICE AND 17 PROCEDURE AVAILABLE TO ALL PARTIES TO COMMISSION 18 PROCEEDINGS.] 19 SECTION 1.2. SECTION 308(A)(2) AND (4), (B), (C), (E), (F) 20 AND (G) OF TITLE 66 ARE AMENDED TO READ: 21 § 308. BUREAUS AND OFFICES. 22 (A) ENUMERATION.--THERE SHALL BE ESTABLISHED WITHIN THE 23 COMMISSION THE FOLLOWING BUREAUS AND FUNCTIONS: 24 * * * 25 [(2) BUREAU OF CONSERVATION, ECONOMICS AND ENERGY 26 PLANNING.] 27 * * * 28 [(4) OFFICE OF SPECIAL ASSISTANTS.] 29 (B) LAW BUREAU.--THE LAW BUREAU SHALL BE A MULTIFUNCTION 30 LEGAL STAFF, CONSISTING OF A PROSECUTORY FUNCTION, AN ADVISORY 20080H2200B4526 - 44 -
1 FUNCTION, A REPRESENTATIONAL FUNCTION AND AN ENFORCEMENT 2 FUNCTION. THE DIRECTOR OF THE LAW BUREAU SHALL BE THE CHIEF 3 COUNSEL OF THE COMMISSION AND SHALL SERVE AT THE PLEASURE OF THE 4 COMMISSION. THE COMMISSION MAY ALSO, FROM TIME TO TIME, APPOINT 5 SUCH ASSISTANT COUNSEL TO THE COMMISSION AS MAY BE REQUIRED FOR 6 THE PROPER CONDUCT OF THE WORK OF THE LAW BUREAU. ASSISTANT 7 COUNSEL MAY BE REMOVED BY THE COMMISSION ONLY FOR GOOD CAUSE. 8 THE LAW BUREAU SHALL ADVISE THE COMMISSION ON ANY AND ALL 9 MATTERS. NO COUNSEL SHALL IN THE SAME CASE OR A FACTUALLY 10 RELATED CASE PERFORM DUTIES IN THE PROSECUTORY AND ADVISORY 11 FUNCTIONS, IF SUCH PERFORMANCE WOULD REPRESENT A CONFLICT OF 12 INTEREST. EXCEPT FOR LITIGATION REFERRED TO THE ATTORNEY GENERAL 13 OR OTHER APPROPRIATE OUTSIDE COUNSEL, THE LAW BUREAU SOLELY 14 SHALL BE RESPONSIBLE TO REPRESENT THE COMMISSION UPON APPEALS 15 AND OTHER HEARINGS IN THE COURTS OF COMMON PLEAS AND IN THE 16 COMMONWEALTH COURT, SUPREME COURT OR OTHER COURTS OF THIS 17 COMMONWEALTH OR IN ANY FEDERAL COURT OR AGENCY AND IN ACTIONS 18 INSTITUTED TO RECOVER PENALTIES AND TO ENFORCE REGULATIONS AND 19 ORDERS OF THE COMMISSION. [NO MEMBER OF THE LAW BUREAU SHALL 20 PARTICIPATE IN ANY PROSECUTORY FUNCTION IN ANY MATTER] IF 21 NECESSARY TO PROTECT THE PUBLIC INTEREST, THE LAW BUREAU, 22 PURSUANT TO ITS PROSECUTORIAL FUNCTION, MAY INITIATE AND 23 PARTICIPATE IN PROCEEDINGS BEFORE THE COMMISSION UNLESS DIRECTED 24 BY THE COMMISSION TO DO SO IN A PROCEEDING INVOLVING 25 TRANSPORTATION, SAFETY, EMINENT DOMAIN, SITING, SERVICE ISSUES 26 HAVING NO IMPACT ON RATES OR ABILITY TO PAY OR ASSIST THE OFFICE 27 OF TRIAL STAFF IN CARRYING OUT THE DUTIES OF THE OFFICE OF TRIAL 28 STAFF, NOR SHALL ANY MEMBER OF THE LAW BUREAU RECEIVE ASSISTANCE 29 FROM THE OFFICE OF TRIAL STAFF IN THE PERFORMANCE OF HIS DUTIES. 30 EXCEPT AS PROVIDED IN THIS SECTION, THE LAW BUREAU MAY RECEIVE 20080H2200B4526 - 45 -
1 ASSISTANCE FROM ANY OTHER BUREAU OR OFFICE OF THE COMMISSION AS 2 DETERMINED TO BE NECESSARY. 3 [(C) BUREAU OF CONSERVATION, ECONOMICS AND ENERGY 4 PLANNING.--THE BUREAU OF CONSERVATION, ECONOMICS AND ENERGY 5 PLANNING SHALL CONDUCT STUDIES AND RESEARCH ALL MATTERS WITHIN 6 THE COMMISSION'S JURISDICTION AND ADVISE THE COMMISSION OF THE 7 RESULTS THEREOF IN ORDER TO ENABLE THE COMMISSION TO PROVIDE 8 PROSPECTIVE REGULATION IN THE BEST INTEREST OF ALL PARTIES 9 CONCERNED. SUCH STUDIES AND RESEARCH SHALL INCLUDE LONG RANGE 10 FORECASTING OF ENERGY NEEDS AND DEVELOPMENT; RESEARCH INTO THE 11 USE OF NEW, EFFICIENT AND ECONOMIC METHODS OF ENERGY PRODUCTION; 12 THE REVIEW OF THE EFFICIENCY OF THE PRESENT GENERATING SYSTEMS 13 OPERATED WITHIN THIS COMMONWEALTH; AND THE DEVELOPMENT OF AN 14 EFFECTIVE PROGRAM OF ENERGY CONSERVATION. THE COMMISSION SHALL 15 REQUIRE ALL ELECTRIC AND GAS PUBLIC UTILITIES SUBJECT TO ITS 16 JURISDICTION TO FILE WITH IT AN ANNUAL CONSERVATION REPORT WHICH 17 SHOWS THE PLANS AND PROGRESS ACHIEVED ON PROGRAMS OF ENERGY 18 CONSERVATION. THE COMMISSION SHALL, BY RULE, PRESCRIBE 19 GUIDELINES FOR THE FORM AND MANNER OF SUCH ANNUAL CONSERVATION 20 REPORT WHICH REPORT SHALL DESCRIBE THE CURRENT AND PROPOSED 21 PROGRAMS OF EACH SUCH UTILITY DESIGNED TO EDUCATE AND ENCOURAGE 22 ITS CUSTOMERS IN THE OPTIMUM, EFFECTIVE AND EFFICIENT USE BY 23 THEM OF ELECTRIC AND GAS ENERGY. THE REPORT SHALL INCLUDE AN 24 ACCOUNTING OF THE MONETARY AND PERSONNEL RESOURCES ACTUALLY OR 25 PROPOSED TO BE EXPENDED OR DEVOTED TO AND THE ACTUAL OR 26 ANTICIPATED RESULTS OF SUCH PROGRAMS. THE BUREAU SHALL REVIEW 27 ALL PROPOSALS FOR ELECTRIC AND GAS PUBLIC UTILITY PLANT 28 EXPANSION AND SHALL SUBMIT FOR CONSIDERATION OF THE COMMISSION 29 ITS FINDINGS ON WHAT IMPACT, IF ANY, THE ELECTRIC AND GAS PUBLIC 30 UTILITY PLANT EXPANSION WILL HAVE ON RATES CHARGED BY THE PUBLIC 20080H2200B4526 - 46 -
1 UTILITY.] 2 * * * 3 [(E) OFFICE OF SPECIAL ASSISTANTS.--THE OFFICE OF SPECIAL 4 ASSISTANTS SHALL BE A SUPPORT STAFF WHICH SHALL BE RESPONSIBLE 5 TO ASSIST IN THE PREPARATION OF COMMISSION ORDERS AND SHALL 6 PERFORM SUCH OTHER ADVISORY DUTIES AS MAY BE REQUIRED OF IT BY 7 THE COMMISSION. NO MEMBER OF THE OFFICE OF SPECIAL ASSISTANTS 8 SHALL PARTICIPATE IN ANY PROSECUTORY FUNCTION IN ANY MATTER 9 BEFORE THE COMMISSION. NO MEMBER OF THE OFFICE OF SPECIAL 10 ASSISTANTS SHALL ASSIST THE OFFICE OF TRIAL STAFF IN CARRYING 11 OUT THE DUTIES OF THE OFFICE OF TRIAL STAFF, NOR SHALL ANY 12 MEMBER OF THE OFFICE OF SPECIAL ASSISTANTS RECEIVE ASSISTANCE 13 FROM THE OFFICE OF TRIAL STAFF IN THE PERFORMANCE OF HIS DUTIES. 14 EXCEPT AS PROVIDED IN THIS SECTION, THE OFFICE OF SPECIAL 15 ASSISTANTS MAY RECEIVE ASSISTANCE FROM, OR PROVIDE ASSISTANCE 16 TO, ANY OTHER BUREAU OR OFFICE OF THE COMMISSION AS DETERMINED 17 TO BE NECESSARY. 18 (F) OTHER BUREAUS AND OFFICES.--THE COMMISSION SHALL 19 ESTABLISH SUCH BUREAU OR BUREAUS TO PERFORM SUCH DUTIES AS THE 20 COMMISSION MAY PRESCRIBE REGARDING ALL MATTERS RESPECTING RATES 21 OF PUBLIC UTILITIES AND ALL MATTERS RESPECTING COMMON CARRIERS 22 AND CONTRACT CARRIERS. THE ESTABLISHMENT OF THESE BUREAUS SHALL 23 NOT BE CONSTRUED TO PROHIBIT THE COMMISSION FROM ESTABLISHING 24 ANY ADDITIONAL BUREAUS WHICH THE COMMISSION FINDS NECESSARY TO 25 PROTECT THE INTERESTS OF THE PEOPLE OF THIS COMMONWEALTH. THE 26 BUREAUS MAY PERFORM SUCH OTHER DUTIES NOT INCONSISTENT WITH LAW 27 AS THE COMMISSION MAY DIRECT. 28 (G) STAFF TESTIMONY.--MEMBERS OF THE STAFF OF THE 29 COMMISSION, EXCEPT FOR THE OFFICE OF SPECIAL ASSISTANTS, SHALL 30 APPEAR AND PRESENT TESTIMONY IN ANY PROCEEDING BEFORE THE 20080H2200B4526 - 47 -
1 COMMISSION WHEN CALLED BY THE COMMISSION, THE CHIEF COUNSEL, THE 2 DIRECTOR OF TRIAL STAFF OR ANY OF THE PARTIES TO THE PROCEEDING. 3 IN ADDITION TO ANY CROSS-EXAMINATION BY THE OFFICE OF TRIAL 4 STAFF AS PROVIDED IN SECTION 306 (RELATING TO OFFICE OF TRIAL 5 STAFF) OR THE CHIEF COUNSEL, ANY MEMBER OF THE COMMISSION STAFF 6 WHO PARTICIPATES IN THE ANALYSIS, REVIEW AND CONCLUSIONS IN ANY 7 PROCEEDINGS BEFORE THE COMMISSION MAY, IN THE DISCRETION OF THE 8 OFFICE OF TRIAL STAFF OR THE CHIEF COUNSEL AND WITH THE CONSENT 9 OF THE PRESIDING OFFICER, CROSS-EXAMINE ANY WITNESS PRESENTED BY 10 THE PARTIES TO THE PROCEEDING AT THE PUBLIC HEARING.] 11 SECTION 1.3. TITLE 66 IS AMENDED BY ADDING A SECTION TO 12 READ: 13 § 308.2. OTHER BUREAUS, OFFICES AND POSITIONS. 14 (A) ESTABLISHMENT OF OTHER BUREAUS, OFFICES AND POSITIONS.-- 15 IN ADDITION TO THE SPECIFIC BUREAUS ESTABLISHED IN THIS PART, 16 THE COMMISSION MAY ESTABLISH OTHER BUREAUS, OFFICES AND 17 POSITIONS TO PERFORM THE FOLLOWING FUNCTIONS: 18 (1) REVIEW AND PROVIDE ADVICE REGARDING APPLICATIONS, 19 PETITIONS, TARIFF FILINGS AND OTHER MATTERS FILED WITH THE 20 COMMISSION. 21 (2) PROVIDE ADVICE, REVIEW EXCEPTIONS AND PREPARE ORDERS 22 REGARDING MATTERS TO BE ADJUDICATED. 23 (3) CONDUCT FINANCIAL REVIEWS, EARNINGS ANALYSES AND 24 OTHER FINANCIAL STUDIES. 25 (4) CONDUCT ECONOMIC RESEARCH, FORECASTING, ENERGY 26 CONSERVATION STUDIES, COST STUDIES AND OTHER ECONOMIC STUDIES 27 RELATED TO PUBLIC UTILITIES. 28 (5) MONITOR INDUSTRY MARKETS TO DETECT ANTICOMPETITIVE, 29 DISCRIMINATORY OR OTHER UNLAWFUL CONDUCT. 30 (6) INSURE ADEQUATE MAINTENANCE, SAFETY AND RELIABILITY 20080H2200B4526 - 48 -
1 OF UTILITY NETWORKS. 2 (7) INSURE ADEQUATE SERVICE QUALITY, EFFICIENCY AND 3 AVAILABILITY AT JUST AND REASONABLE RATES. 4 (8) CONDUCT FINANCIAL, MANAGEMENT, OPERATIONAL AND 5 SPECIAL AUDITS. 6 (9) PROVIDE CONSUMER INFORMATION, CONSUMER PROTECTION 7 AND INFORMAL RESOLUTION OF COMPLAINTS. 8 (10) INSURE ADEQUATE SAFETY, INSURANCE, FITNESS AND 9 OTHER REQUIREMENTS RELEVANT TO TRANSPORTATION UTILITIES. 10 (11) TAKE APPROPRIATE ENFORCEMENT ACTIONS, INCLUDING 11 RATE PROCEEDINGS, SERVICE PROCEEDINGS AND ALLOCATION 12 PROCEEDINGS, NECESSARY TO INSURE COMPLIANCE WITH THIS TITLE, 13 COMMISSION REGULATIONS AND ORDERS. 14 (12) PERFORM OTHER FUNCTIONS THE COMMISSION DEEMS 15 NECESSARY FOR THE PROPER WORK OF THE COMMISSION. 16 (B) PROHIBITION ON COMMINGLING OF FUNCTIONS.--A COMMISSION 17 EMPLOYEE ENGAGED IN A PROSECUTORY FUNCTION MAY NOT, IN THAT 18 MATTER OR A FACTUALLY RELATED MATTER, PROVIDE ADVICE OR 19 ASSISTANCE TO A COMMISSION EMPLOYEE PERFORMING AN ADVISORY 20 FUNCTION AS TO THAT MATTER. 21 SECTION 1.4. SECTION 2803 OF TITLE 66 IS AMENDED BY ADDING 22 DEFINITIONS TO READ: 23 § 2803. DEFINITIONS. 24 THE FOLLOWING WORDS AND PHRASES WHEN USED IN THIS CHAPTER 25 SHALL HAVE THE MEANINGS GIVEN TO THEM IN THIS SECTION UNLESS THE 26 CONTEXT CLEARLY INDICATES OTHERWISE: 27 * * * 28 "BILATERAL CONTRACT." AN AGREEMENT, AS APPROVED BY THE 29 PENNSYLVANIA PUBLIC UTILITY COMMISSION, REACHED BY TWO PARTIES, 30 EACH ACTING IN ITS OWN INDEPENDENT SELF-INTEREST, AS A RESULT OF 20080H2200B4526 - 49 -
1 NEGOTIATIONS FREE OF UNDUE INFLUENCE, DURESS OR FAVORITISM, IN 2 WHICH THE ELECTRIC ENERGY SUPPLIER AGREES TO SELL AND THE 3 ELECTRIC DISTRIBUTION COMPANY AGREES TO BUY A QUANTITY OF 4 ELECTRIC ENERGY AT A SPECIFIED PRICE FOR A SPECIFIED PERIOD OF 5 TIME UNDER TERMS AGREED TO BY BOTH PARTIES, AND WHICH FOLLOWS A 6 STANDARD INDUSTRY TEMPLATE WIDELY ACCEPTED IN THE INDUSTRY OR 7 VARIATIONS THERETO ACCEPTED BY THE PARTIES. STANDARD INDUSTRY 8 TEMPLATES MAY INCLUDE THE EEI MASTER AGREEMENT FOR PHYSICAL 9 ENERGY PURCHASES AND SALES AND THE ISDA MASTER AGREEMENT FOR 10 FINANCIAL ENERGY PURCHASES AND SALES. 11 * * * 12 "DEFAULT SERVICE PROVIDER." AN ELECTRIC DISTRIBUTION COMPANY 13 WITHIN ITS CERTIFIED SERVICE TERRITORY OR AN ALTERNATIVE 14 SUPPLIER APPROVED BY THE PENNSYLVANIA PUBLIC UTILITY COMMISSION 15 THAT PROVIDES GENERATION SERVICE TO RETAIL ELECTRIC CUSTOMERS 16 WHO: 17 (1) CONTRACT FOR ELECTRIC POWER, INCLUDING ENERGY AND 18 CAPACITY, AND THE CHOSEN ELECTRIC GENERATION SUPPLIER DOES 19 NOT SUPPLY THE SERVICE; OR 20 (2) DO NOT CHOOSE AN ALTERNATIVE ELECTRIC GENERATION 21 SUPPLIER. 22 * * * 23 SECTION 2. TITLE 66 IS AMENDED BY ADDING SECTIONS TO READ: 24 § 2806.1. ENERGY EFFICIENCY AND CONSERVATION PROGRAM. 25 (A) PROGRAM.--THE COMMISSION SHALL, BY JANUARY 15, 2009, 26 ADOPT AN ENERGY EFFICIENCY AND CONSERVATION PROGRAM TO REQUIRE 27 ELECTRIC DISTRIBUTION COMPANIES TO ADOPT AND IMPLEMENT COST- 28 EFFECTIVE ENERGY EFFICIENCY AND CONSERVATION PLANS TO REDUCE 29 ENERGY DEMAND AND CONSUMPTION WITHIN THE SERVICE TERRITORY OF 30 EACH ELECTRIC DISTRIBUTION COMPANY IN THIS COMMONWEALTH. THE 20080H2200B4526 - 50 -
1 PROGRAM SHALL INCLUDE: 2 (1) PROCEDURES FOR THE APPROVAL OF PLANS SUBMITTED UNDER 3 SUBSECTION (B). 4 (2) AN EVALUATION PROCESS, INCLUDING A PROCESS TO 5 MONITOR AND VERIFY DATA COLLECTION, QUALITY ASSURANCE AND 6 RESULTS OF EACH PLAN AND THE PROGRAM. 7 (3) AN ANALYSIS OF THE COST AND BENEFIT OF EACH PLAN 8 SUBMITTED UNDER SUBSECTION (B) IN ACCORDANCE WITH A TOTAL 9 RESOURCE COST TEST APPROVED BY THE COMMISSION. 10 (4) AN ANALYSIS OF HOW THE PROGRAM AND INDIVIDUAL PLANS 11 WILL ENABLE EACH ELECTRIC DISTRIBUTION COMPANY TO ACHIEVE OR 12 EXCEED THE REQUIREMENTS FOR REDUCTION IN CONSUMPTION UNDER 13 SUBSECTIONS (C) AND (D). 14 (5) STANDARDS TO ENSURE THAT EACH PLAN INCLUDES A 15 VARIETY OF ENERGY EFFICIENCY AND CONSERVATION MEASURES AND 16 WILL PROVIDE THE MEASURES EQUITABLY TO ALL CLASSES OF 17 CUSTOMERS. 18 (6) PROCEDURES TO MAKE RECOMMENDATIONS AS TO ADDITIONAL 19 MEASURES THAT WILL ENABLE AN ELECTRIC DISTRIBUTION COMPANY TO 20 IMPROVE ITS PLAN AND EXCEED THE REQUIRED REDUCTIONS IN 21 CONSUMPTION UNDER SUBSECTIONS (C) AND (D). 22 (7) PROCEDURES TO REQUIRE THAT ELECTRIC DISTRIBUTION 23 COMPANIES COMPETITIVELY BID ALL CONTRACTS WITH CONSERVATION 24 SERVICE PROVIDERS. 25 (8) PROCEDURES TO REVIEW ALL PROPOSED CONTRACTS PRIOR TO 26 THE EXECUTION OF THE CONTRACT WITH CONSERVATION SERVICE 27 PROVIDERS TO IMPLEMENT THE PLAN. THE COMMISSION MAY ORDER THE 28 MODIFICATION OF A PROPOSED CONTRACT TO ENSURE THAT THE PLAN 29 MEETS THE REQUIREMENTS FOR REDUCTION IN DEMAND AND 30 CONSUMPTION UNDER SUBSECTIONS (C) AND (D). 20080H2200B4526 - 51 -
1 (9) PROCEDURES TO ENSURE COMPLIANCE WITH REQUIREMENTS 2 FOR REDUCTION IN CONSUMPTION UNDER SUBSECTIONS (C) AND (D). 3 (10) A REQUIREMENT FOR THE PARTICIPATION OF CONSERVATION 4 SERVICE PROVIDERS IN THE IMPLEMENTATION OF ALL OR PART OF A 5 PLAN. 6 (11) COST RECOVERY TO ENSURE THAT MEASURES APPROVED ARE 7 FINANCED BY THE SAME CUSTOMER CLASS THAT WILL RECEIVE THE 8 DIRECT ENERGY AND CONSERVATION BENEFITS. 9 (B) DUTIES OF ELECTRIC DISTRIBUTION COMPANIES.-- 10 (1) (I) BY JULY 1, 2009, EACH ELECTRIC DISTRIBUTION 11 COMPANY SHALL DEVELOP AND FILE AN ENERGY EFFICIENCY AND 12 CONSERVATION PLAN WITH THE COMMISSION FOR APPROVAL TO 13 MEET THE REQUIREMENTS OF SUBSECTION (A) AND THE 14 REQUIREMENTS FOR REDUCTION IN CONSUMPTION UNDER 15 SUBSECTIONS (C) AND (D). THE PLAN SHALL BE IMPLEMENTED 16 UPON APPROVAL BY THE COMMISSION. THE FOLLOWING ARE THE 17 PLAN REQUIREMENTS: 18 (A) THE PLAN SHALL INCLUDE SPECIFIC PROPOSALS TO 19 IMPLEMENT ENERGY EFFICIENCY AND CONSERVATION MEASURES 20 TO ACHIEVE OR EXCEED THE REQUIRED REDUCTIONS IN 21 CONSUMPTION UNDER SUBSECTIONS (C) AND (D). 22 (B) A MINIMUM OF 10% OF THE REQUIRED REDUCTIONS 23 IN CONSUMPTION UNDER SUBSECTIONS (C) AND (D) SHALL BE 24 OBTAINED FROM UNITS OF FEDERAL, STATE AND LOCAL 25 GOVERNMENT, INCLUDING MUNICIPALITIES, SCHOOL 26 DISTRICTS, INSTITUTIONS OF HIGHER EDUCATION AND 27 NONPROFIT ENTITIES. 28 (C) THE PLAN SHALL EXPLAIN HOW QUALITY ASSURANCE 29 AND PERFORMANCE WILL BE MEASURED, VERIFIED AND 30 EVALUATED. 20080H2200B4526 - 52 -
1 (D) THE PLAN SHALL STATE THE MANNER IN WHICH THE 2 PLAN WILL ACHIEVE THE REQUIREMENTS OF THE PROGRAM 3 UNDER SUBSECTION (A) AND WILL ACHIEVE OR EXCEED THE 4 REQUIRED REDUCTIONS IN CONSUMPTION UNDER SUBSECTIONS 5 (C) AND (D). 6 (E) THE PLAN SHALL INCLUDE A CONTRACT WITH ONE 7 OR MORE CONSERVATION SERVICE PROVIDERS SELECTED BY 8 COMPETITIVE BID TO IMPLEMENT THE PLAN OR A PORTION OF 9 THE PLAN AS APPROVED BY THE COMMISSION. 10 (F) THE PLAN SHALL INCLUDE ESTIMATES OF THE COST 11 OF IMPLEMENTATION OF THE ENERGY EFFICIENCY AND 12 CONSERVATION MEASURES IN THE PLAN. 13 (G) THE PLAN SHALL INCLUDE SPECIFIC ENERGY 14 EFFICIENCY MEASURES FOR HOUSEHOLDS AT OR BELOW 150% 15 OF THE FEDERAL POVERTY INCOME GUIDELINES. THE NUMBER 16 OF MEASURES SHALL BE PROPORTIONATE TO THOSE 17 HOUSEHOLDS' SHARE OF THE TOTAL ENERGY USAGE IN THE 18 SERVICE TERRITORY. THE ELECTRIC DISTRIBUTION COMPANY 19 SHALL COORDINATE MEASURES UNDER THIS CLAUSE WITH 20 OTHER PROGRAMS ADMINISTERED BY THE COMMISSION OR 21 ANOTHER FEDERAL OR STATE AGENCY. THE EXPENDITURES OF 22 AN ELECTRIC DISTRIBUTION COMPANY UNDER THIS CLAUSE 23 SHALL BE IN ADDITION TO EXPENDITURES MADE UNDER 52 24 PA. CODE CH. 58 (RELATING TO RESIDENTIAL LOW INCOME 25 USAGE REDUCTION PROGRAMS). 26 (H) THE PLAN SHALL INCLUDE A PROPOSED COST- 27 RECOVERY TARIFF MECHANISM, IN ACCORDANCE WITH SECTION 28 1307 (RELATING TO SLIDING SCALE OR RATES; 29 ADJUSTMENTS), TO FUND THE ENERGY EFFICIENCY AND 30 CONSERVATION MEASURES AND TO ENSURE FULL AND CURRENT 20080H2200B4526 - 53 -
1 RECOVERY OF THE PRUDENT AND REASONABLE COSTS OF THE 2 PLAN, INCLUDING ADMINISTRATIVE COSTS, AS APPROVED BY 3 THE COMMISSION. 4 (I) THE ELECTRIC DISTRIBUTION COMPANY SHALL 5 DEMONSTRATE THAT THE PLAN IS COST-EFFECTIVE USING A 6 TOTAL RESOURCE COST TEST APPROVED BY THE COMMISSION 7 AND PROVIDES A DIVERSE CROSS SECTION OF ALTERNATIVES 8 FOR CUSTOMERS OF ALL RATE CLASSES. 9 (J) THE PLAN SHALL REQUIRE AN ANNUAL INDEPENDENT 10 EVALUATION OF ITS COST-EFFECTIVENESS AND A FULL 11 REVIEW OF THE RESULTS OF EACH FIVE-YEAR PLAN REQUIRED 12 UNDER SUBSECTION (C)(3) AND, TO THE EXTENT PRACTICAL, 13 HOW THE PLAN WILL BE ADJUSTED ON A GOING-FORWARD 14 BASIS AS A RESULT OF THE EVALUATION. 15 (K) THE PLAN SHALL INCLUDE AN ANALYSIS OF THE 16 ELECTRIC DISTRIBUTION COMPANY'S ADMINISTRATIVE COSTS. 17 (II) A NEW PLAN SHALL BE FILED WITH THE COMMISSION 18 EVERY FIVE YEARS OR AS OTHERWISE REQUIRED BY THE 19 COMMISSION. THE PLAN SHALL SET FORTH THE MANNER IN WHICH 20 THE COMPANY WILL MEET THE REQUIRED REDUCTIONS IN 21 CONSUMPTION UNDER SUBSECTIONS (C) AND (D). 22 (III) NO MORE THAN 2% OF FUNDS AVAILABLE TO 23 IMPLEMENT A PLAN UNDER THIS SUBSECTION SHALL BE ALLOCATED 24 FOR EXPERIMENTAL EQUIPMENT OR DEVICES. 25 (2) THE COMMISSION SHALL DIRECT AN ELECTRIC DISTRIBUTION 26 COMPANY TO MODIFY OR TERMINATE ANY PART OF A PLAN APPROVED 27 UNDER THIS SECTION IF, AFTER AN ADEQUATE PERIOD FOR 28 IMPLEMENTATION, THE COMMISSION DETERMINES THAT AN ENERGY 29 EFFICIENCY OR CONSERVATION MEASURE INCLUDED IN THE PLAN WILL 30 NOT ACHIEVE THE REQUIRED REDUCTIONS IN CONSUMPTION IN A COST- 20080H2200B4526 - 54 -
1 EFFECTIVE MANNER UNDER SUBSECTIONS (C) AND (D). 2 (3) IF PART OF A PLAN IS MODIFIED OR TERMINATED UNDER 3 PARAGRAPH (2), THE ELECTRIC DISTRIBUTION COMPANY SHALL SUBMIT 4 A REVISED PLAN DESCRIBING ACTIONS TO BE TAKEN TO OFFER 5 SUBSTITUTE MEASURES OR TO INCREASE THE AVAILABILITY OF 6 EXISTING MEASURES IN THE PLAN TO ACHIEVE THE REQUIRED 7 REDUCTIONS IN CONSUMPTION UNDER SUBSECTIONS (C) AND (D). 8 (C) REDUCTIONS IN CONSUMPTION.--THE PLANS ADOPTED UNDER 9 SUBSECTION (B) SHALL REDUCE ELECTRIC CONSUMPTION AS FOLLOWS: 10 (1) BY MAY 31, 2011, TOTAL ANNUAL WEATHER-NORMALIZED 11 CONSUMPTION OF THE RETAIL CUSTOMERS OF EACH ELECTRIC 12 DISTRIBUTION COMPANY SHALL BE REDUCED BY A MINIMUM OF 1%. THE 13 1% LOAD REDUCTION IN CONSUMPTION SHALL BE MEASURED AGAINST 14 THE ELECTRIC DISTRIBUTION COMPANY'S EXPECTED LOAD AS 15 FORECASTED BY THE COMMISSION FOR JUNE 1, 2009, THROUGH MAY 16 31, 2010, WITH PROVISIONS MADE FOR WEATHER ADJUSTMENTS AND 17 EXTRAORDINARY LOADS THAT THE ELECTRIC DISTRIBUTION COMPANY 18 MUST SERVE. 19 (2) BY MAY 31, 2013, THE TOTAL ANNUAL WEATHER-NORMALIZED 20 CONSUMPTION OF THE RETAIL CUSTOMERS OF EACH ELECTRIC 21 DISTRIBUTION COMPANY SHALL BE REDUCED BY A MINIMUM OF 3%. THE 22 3% LOAD REDUCTION IN CONSUMPTION SHALL BE MEASURED AGAINST 23 THE ELECTRIC DISTRIBUTION COMPANY'S EXPECTED LOAD AS 24 FORECASTED BY THE COMMISSION FOR JUNE 1, 2009, THROUGH MAY 25 31, 2010, WITH PROVISION MADE FOR WEATHER ADJUSTMENTS AND 26 EXTRAORDINARY LOADS THAT THE ELECTRIC DISTRIBUTION COMPANY 27 MUST SERVE. 28 (3) BY NOVEMBER 30, 2013, AND EVERY FIVE YEARS 29 THEREAFTER, THE COMMISSION SHALL EVALUATE THE COSTS AND 30 BENEFITS OF THE PROGRAM ESTABLISHED UNDER SUBSECTION (A) AND 20080H2200B4526 - 55 -
1 OF APPROVED ENERGY EFFICIENCY AND CONSERVATION PLANS 2 SUBMITTED TO THE PROGRAM. THE EVALUATION SHALL BE CONSISTENT 3 WITH A TOTAL RESOURCE COST TEST OR A COST-BENEFIT ANALYSIS 4 DETERMINED BY THE COMMISSION. IF THE COMMISSION DETERMINES 5 THAT THE BENEFITS OF THE PROGRAM EXCEED THE COSTS, THE 6 COMMISSION SHALL ADOPT ADDITIONAL REQUIRED INCREMENTAL 7 REDUCTIONS IN CONSUMPTION. 8 (D) PEAK DEMAND.--THE PLANS ADOPTED UNDER SUBSECTION (B) 9 SHALL REDUCE ELECTRIC DEMAND AS FOLLOWS: 10 (1) BY MAY 31, 2013, THE WEATHER-NORMALIZED DEMAND OF 11 THE RETAIL CUSTOMERS OF EACH ELECTRIC DISTRIBUTION COMPANY 12 SHALL BE REDUCED BY A MINIMUM OF 4.5% OF ANNUAL SYSTEM PEAK 13 DEMAND IN THE 100 HOURS OF HIGHEST DEMAND. THE REDUCTION 14 SHALL BE MEASURED AGAINST THE ELECTRIC DISTRIBUTION COMPANY'S 15 PEAK DEMAND FOR JUNE 1, 2007, THROUGH MAY 31, 2008. 16 (2) BY NOVEMBER 30, 2013, THE COMMISSION SHALL COMPARE 17 THE TOTAL COSTS OF ENERGY EFFICIENCY AND CONSERVATION PLANS 18 IMPLEMENTED UNDER THIS SECTION TO THE TOTAL SAVINGS IN ENERGY 19 AND CAPACITY COSTS TO RETAIL CUSTOMERS IN THIS COMMONWEALTH 20 OR OTHER COSTS DETERMINED BY THE COMMISSION. IF THE 21 COMMISSION DETERMINES THAT THE BENEFITS OF THE PLANS EXCEED 22 THE COSTS, THE COMMISSION SHALL SET ADDITIONAL INCREMENTAL 23 REQUIREMENTS FOR REDUCTION IN PEAK DEMAND FOR THE 100 HOURS 24 OF GREATEST DEMAND OR AN ALTERNATIVE REDUCTION APPROVED BY 25 THE COMMISSION. REDUCTIONS IN DEMAND SHALL BE MEASURED FROM 26 THE ELECTRIC DISTRIBUTION COMPANY'S PEAK DEMAND FOR THE 27 PERIOD FROM JUNE 1, 2011, THROUGH MAY 31, 2012. THE 28 REDUCTIONS IN CONSUMPTION REQUIRED BY THE COMMISSION SHALL BE 29 ACCOMPLISHED NO LATER THAN MAY 31, 2017. 30 (E) COMMISSION APPROVAL.-- 20080H2200B4526 - 56 -
1 (1) THE COMMISSION SHALL CONDUCT A PUBLIC HEARING ON 2 EACH PLAN AND ALLOW FOR THE SUBMISSION OF RECOMMENDATIONS BY 3 THE OFFICE OF CONSUMER ADVOCATE AND THE OFFICE OF SMALL 4 BUSINESS ADVOCATE AND BY MEMBERS OF THE PUBLIC AS TO HOW THE 5 ELECTRIC DISTRIBUTION COMPANY COULD IMPROVE ITS PLAN OR 6 EXCEED THE REQUIRED REDUCTIONS IN CONSUMPTION UNDER 7 SUBSECTIONS (C) AND (D). 8 (2) THE COMMISSION SHALL APPROVE OR DISAPPROVE A PLAN 9 FILED UNDER SUBSECTION (B) WITHIN 120 DAYS OF SUBMISSION. THE 10 FOLLOWING SHALL APPLY TO AN ORDER DISAPPROVING A PLAN: 11 (I) THE COMMISSION SHALL DESCRIBE IN DETAIL THE 12 REASONS FOR THE DISAPPROVAL. 13 (II) THE ELECTRIC DISTRIBUTION COMPANY SHALL HAVE 60 14 DAYS TO FILE A REVISED PLAN TO ADDRESS THE DEFICIENCIES 15 IDENTIFIED BY THE COMMISSION. THE REVISED PLAN SHALL BE 16 APPROVED OR DISAPPROVED BY THE COMMISSION WITHIN 60 DAYS. 17 (F) PENALTIES.-- 18 (1) THE FOLLOWING SHALL APPLY FOR FAILURE TO SUBMIT A 19 PLAN: 20 (I) AN ELECTRIC DISTRIBUTION COMPANY THAT FAILS TO 21 FILE A PLAN UNDER SUBSECTION (B) SHALL BE SUBJECT TO A 22 CIVIL PENALTY OF $100,000 PER DAY UNTIL THE PLAN IS 23 FILED. 24 (II) AN ELECTRIC DISTRIBUTION COMPANY THAT FAILS TO 25 FILE A REVISED PLAN UNDER SUBSECTION (E)(2)(II) SHALL BE 26 SUBJECT TO A CIVIL PENALTY OF $100,000 PER DAY UNTIL THE 27 PLAN IS FILED. 28 (III) PENALTIES COLLECTED UNDER THIS PARAGRAPH SHALL 29 BE DEPOSITED IN THE LOW-INCOME ELECTRIC CUSTOMER 30 ASSISTANCE PROGRAM OF THE ENERGY DISTRIBUTION COMPANY FOR 20080H2200B4526 - 57 -
1 THE RESPECTIVE SERVICE TERRITORY. 2 (2) THE FOLLOWING SHALL APPLY TO AN ELECTRIC 3 DISTRIBUTION COMPANY THAT FAILS TO ACHIEVE THE REDUCTIONS IN 4 CONSUMPTION REQUIRED UNDER SUBSECTION (C) OR (D): 5 (I) THE ELECTRIC DISTRIBUTION COMPANY SHALL BE 6 SUBJECT TO A CIVIL PENALTY NOT LESS THAN $1,000,000 AND 7 NOT TO EXCEED $20,000,000 FOR FAILURE TO ACHIEVE THE 8 REQUIRED REDUCTIONS IN CONSUMPTION UNDER SUBSECTION (C) 9 OR (D). ANY PENALTY PAID BY AN ELECTRIC DISTRIBUTION 10 COMPANY UNDER THIS SUBPARAGRAPH SHALL NOT BE RECOVERABLE 11 FROM RATEPAYERS. 12 (II) IF AN ELECTRIC DISTRIBUTION COMPANY FAILS TO 13 ACHIEVE THE REQUIRED REDUCTIONS IN CONSUMPTION UNDER 14 SUBSECTION (C) OR (D), RESPONSIBILITY TO ACHIEVE THE 15 REDUCTIONS IN CONSUMPTION SHALL BE TRANSFERRED TO THE 16 COMMISSION. THE COMMISSION SHALL DO ALL OF THE FOLLOWING: 17 (A) IMPLEMENT A PLAN TO ACHIEVE THE REQUIRED 18 REDUCTIONS IN CONSUMPTION UNDER SUBSECTION (C) OR 19 (D). 20 (B) CONTRACT WITH CONSERVATION SERVICE PROVIDERS 21 AS NECESSARY TO IMPLEMENT ANY PORTION OF THE PLAN. 22 (G) LIMITATION ON COSTS.--THE TOTAL COST OF ANY PLAN 23 REQUIRED UNDER THIS SECTION SHALL NOT EXCEED 2% OF THE ELECTRIC 24 DISTRIBUTION COMPANY'S TOTAL ANNUAL REVENUE AS OF DECEMBER 31, 25 2006. THE PROVISIONS OF THIS PARAGRAPH SHALL NOT APPLY TO THE 26 COST OF LOW-INCOME USAGE REDUCTION PROGRAMS ESTABLISHED UNDER 52 27 PA. CODE CH. 58 (RELATING TO RESIDENTIAL LOW INCOME USAGE 28 REDUCTION PROGRAMS). 29 (H) COSTS.--THE COMMISSION SHALL RECOVER FROM ELECTRIC 30 DISTRIBUTION COMPANIES THE COSTS OF IMPLEMENTING THE PROGRAM 20080H2200B4526 - 58 -
1 ESTABLISHED UNDER THIS SECTION. 2 (I) REPORT.--THE FOLLOWING SHALL APPLY: 3 (1) EACH ELECTRIC DISTRIBUTION COMPANY SHALL SUBMIT AN 4 ANNUAL REPORT TO THE COMMISSION RELATING TO THE RESULTS OF 5 THE ENERGY EFFICIENCY AND CONSERVATION PLAN WITHIN EACH 6 ELECTRIC DISTRIBUTION SERVICE TERRITORY. THE REPORT SHALL 7 INCLUDE ALL OF THE FOLLOWING: 8 (I) DOCUMENTATION OF PROGRAM EXPENDITURES. 9 (II) MEASUREMENT AND VERIFICATION OF ENERGY SAVINGS 10 UNDER THE PLAN. 11 (III) EVALUATION OF THE COST-EFFECTIVENESS OF 12 EXPENDITURES. 13 (IV) ANY OTHER INFORMATION REQUIRED BY THE 14 COMMISSION. 15 (2) BEGINNING FIVE YEARS FOLLOWING THE EFFECTIVE DATE OF 16 THIS SECTION AND ANNUALLY THEREAFTER, THE COMMISSION SHALL 17 SUBMIT A REPORT TO THE CONSUMER PROTECTION AND PROFESSIONAL 18 LICENSURE COMMITTEE OF THE SENATE AND THE CONSUMER AFFAIRS 19 COMMITTEE OF THE HOUSE OF REPRESENTATIVES. 20 (J) EXISTING FUNDING SOURCES.--EACH ELECTRIC DISTRIBUTION 21 COMPANY SHALL, UPON REQUEST BY ANY PERSON, PROVIDE A LIST OF ALL 22 ELIGIBLE FEDERAL AND STATE FUNDING PROGRAMS AVAILABLE TO 23 RATEPAYERS FOR ENERGY EFFICIENCY AND CONSERVATION. THE LIST 24 SHALL BE POSTED ON THE ELECTRIC DISTRIBUTION COMPANY'S INTERNET 25 WEBSITE. 26 (K) RECOVERY.-- 27 (1) AN ELECTRIC DISTRIBUTION COMPANY SHALL RECOVER ON A 28 FULL AND CURRENT BASIS FROM CUSTOMERS, THROUGH A RECONCILABLE 29 ADJUSTMENT CLAUSE UNDER SECTION 1307, ALL REASONABLE AND 30 PRUDENT COSTS INCURRED IN THE PROVISION OR MANAGEMENT OF A 20080H2200B4526 - 59 -
1 PLAN PROVIDED UNDER THIS SECTION. THIS PARAGRAPH SHALL APPLY 2 TO ALL ELECTRIC DISTRIBUTION COMPANIES, INCLUDING ELECTRIC 3 DISTRIBUTION COMPANIES SUBJECT TO GENERATION OR OTHER RATE 4 CAPS. 5 (2) EXCEPT AS SET FORTH IN PARAGRAPH (3), DECREASED 6 REVENUES OF AN ELECTRIC DISTRIBUTION COMPANY DUE TO REDUCED 7 ENERGY CONSUMPTION OR CHANGES IN ENERGY DEMAND SHALL NOT BE A 8 RECOVERABLE COST UNDER A RECONCILABLE AUTOMATIC ADJUSTMENT 9 CLAUSE. 10 (3) DECREASED REVENUE AND REDUCED ENERGY CONSUMPTION MAY 11 BE REFLECTED IN REVENUE AND SALES DATA USED TO CALCULATE 12 RATES IN A DISTRIBUTION-BASE RATE PROCEEDING FILED BY AN 13 ELECTRIC DISTRIBUTION COMPANY UNDER SECTION 1308 (RELATING TO 14 VOLUNTARY CHANGES IN RATES). 15 (L) APPLICABILITY.--THIS SECTION SHALL NOT APPLY TO AN 16 ELECTRIC DISTRIBUTION COMPANY WITH FEWER THAN 100,000 CUSTOMERS. 17 (M) DEFINITIONS.--AS USED IN THIS SECTION, THE FOLLOWING 18 WORDS AND PHRASES SHALL HAVE THE MEANINGS GIVEN TO THEM IN THIS 19 SUBSECTION: 20 "CONSERVATION SERVICE PROVIDER." AN ENTITY THAT PROVIDES 21 INFORMATION AND TECHNICAL ASSISTANCE ON MEASURES TO ENABLE A 22 PERSON TO INCREASE ENERGY EFFICIENCY OR REDUCE ENERGY 23 CONSUMPTION AND THAT HAS NO DIRECT OR INDIRECT OWNERSHIP, 24 PARTNERSHIP OR OTHER AFFILIATED INTEREST WITH AN ELECTRIC 25 DISTRIBUTION COMPANY. 26 "ELECTRIC DISTRIBUTION COMPANY TOTAL ANNUAL REVENUE." 27 AMOUNTS PAID TO THE ELECTRIC DISTRIBUTION COMPANY FOR 28 GENERATION, TRANSMISSION, DISTRIBUTION AND SURCHARGES BY RETAIL 29 CUSTOMERS. 30 "ENERGY EFFICIENCY AND CONSERVATION MEASURES." 20080H2200B4526 - 60 -
1 (1) TECHNOLOGIES, MANAGEMENT PRACTICES OR OTHER MEASURES 2 EMPLOYED BY RETAIL CUSTOMERS THAT REDUCE ELECTRICITY 3 CONSUMPTION OR DEMAND IF ALL OF THE FOLLOWING APPLY: 4 (I) THE TECHNOLOGY, PRACTICE OR OTHER MEASURE IS 5 INSTALLED ON OR AFTER THE EFFECTIVE DATE OF THIS SECTION 6 AT THE LOCATION OF A RETAIL CUSTOMER. 7 (II) THE TECHNOLOGY, PRACTICE OR OTHER MEASURE 8 REDUCES CONSUMPTION OF ENERGY OR PEAK LOAD BY THE RETAIL 9 CUSTOMER. 10 (III) THE COST OF THE ACQUISITION OR INSTALLATION OF 11 THE MEASURE IS DIRECTLY INCURRED IN WHOLE OR IN PART BY 12 THE ELECTRIC DISTRIBUTION COMPANY. 13 (2) ENERGY EFFICIENCY AND CONSERVATION MEASURES SHALL 14 INCLUDE SOLAR OR SOLAR PHOTOVOLTAIC PANELS, ENERGY EFFICIENT 15 WINDOWS AND DOORS, ENERGY EFFICIENT LIGHTING, INCLUDING EXIT 16 SIGN RETROFIT, HIGH BAY FLUORESCENT RETROFIT AND PEDESTRIAN 17 AND TRAFFIC SIGNAL CONVERSION, GEOTHERMAL HEATING, 18 INSULATION, AIR SEALING, REFLECTIVE ROOF COATINGS, ENERGY 19 EFFICIENT HEATING AND COOLING EQUIPMENT OR SYSTEMS AND ENERGY 20 EFFICIENT APPLIANCES AND OTHER TECHNOLOGIES, PRACTICES OR 21 MEASURES APPROVED BY THE COMMISSION. 22 "PEAK DEMAND." THE HIGHEST ELECTRICAL REQUIREMENT OCCURRING 23 DURING A SPECIFIED PERIOD. FOR AN ELECTRIC DISTRIBUTION COMPANY, 24 THE TERM SHALL MEAN THE SUM OF THE METERED CONSUMPTION FOR ALL 25 RETAIL CUSTOMERS OVER THAT PERIOD. 26 "QUALITY ASSURANCE." ALL OF THE FOLLOWING: 27 (1) THE AUDITING OF BUILDINGS, EQUIPMENT AND PROCESSES 28 TO DETERMINE THE COST-EFFECTIVENESS OF ENERGY EFFICIENCY AND 29 CONSERVATION MEASURES USING NATIONALLY RECOGNIZED TOOLS AND 30 CERTIFICATION PROGRAMS. 20080H2200B4526 - 61 -
1 (2) INDEPENDENT INSPECTION OF COMPLETED ENERGY 2 EFFICIENCY AND CONSERVATION MEASURES COMPLETED BY THIRD-PARTY 3 ENTITIES TO EVALUATE THE QUALITY OF THE COMPLETED MEASURE. 4 "REAL-TIME PRICE." A RATE THAT DIRECTLY REFLECTS THE 5 DIFFERENT COST OF ENERGY DURING EACH HOUR. 6 "TIME-OF-USE RATE." A RATE THAT REFLECTS THE COSTS OF 7 SERVING CUSTOMERS DURING DIFFERENT TIME PERIODS, INCLUDING OFF- 8 PEAK AND ON-PEAK PERIODS, BUT NOT AS FREQUENTLY AS EACH HOUR. 9 "TOTAL RESOURCE COST TEST." A STANDARD TEST THAT IS MET IF, 10 OVER THE EFFECTIVE LIFE OF EACH PLAN NOT TO EXCEED 15 YEARS, THE 11 NET PRESENT VALUE OF THE AVOIDED MONETARY COST OF SUPPLYING 12 ELECTRICITY IS GREATER THAN THE NET PRESENT VALUE OF THE 13 MONETARY COST OF ENERGY EFFICIENCY CONSERVATION MEASURES. 14 § 2806.2. ENERGY EFFICIENCY AND CONSERVATION. 15 (A) REGISTRY.--THE COMMISSION SHALL, BY MARCH 1, 2009, 16 ESTABLISH A REGISTRY OF APPROVED PERSONS QUALIFIED TO PROVIDE 17 CONSERVATION SERVICES TO ALL CLASSES OF CUSTOMERS. IN ORDER TO 18 BE INCLUDED IN THE REGISTRY, A CONSERVATION SERVICE PROVIDER 19 MUST MEET EXPERIENCE AND OTHER QUALIFICATIONS DETERMINED BY THE 20 COMMISSION. 21 (B) APPLICATION.--THE COMMISSION SHALL DEVELOP AN 22 APPLICATION FOR REGISTRATION UNDER SUBSECTION (A) AND MAY CHARGE 23 A REASONABLE REGISTRATION FEE. 24 SECTION 3. SECTION 2807(E) OF TITLE 66 IS AMENDED AND THE 25 SECTION IS AMENDED BY ADDING SUBSECTIONS TO READ: 26 § 2807. DUTIES OF ELECTRIC DISTRIBUTION COMPANIES. 27 * * * 28 (E) OBLIGATION TO SERVE.--[AN ELECTRIC DISTRIBUTION 29 COMPANY'S] A DEFAULT SERVICE PROVIDER'S OBLIGATION TO PROVIDE 30 ELECTRIC GENERATION SUPPLY SERVICE FOLLOWING [IMPLEMENTATION OF 20080H2200B4526 - 62 -
1 RESTRUCTURING AND THE CHOICE OF ALTERNATIVE GENERATION BY A 2 CUSTOMER] THE EXPIRATION OF A GENERATION RATE CAP SPECIFIED 3 UNDER SECTION 2804(4) (RELATING TO STANDARDS FOR RESTRUCTURING 4 OF ELECTRIC INDUSTRY) OR A RESTRUCTURING PLAN UNDER SECTION 5 2806(F) (RELATING TO IMPLEMENTATION, PILOT PROGRAMS AND 6 PERFORMANCE-BASED RATES) IS REVISED AS FOLLOWS: 7 (1) WHILE AN ELECTRIC DISTRIBUTION COMPANY COLLECTS 8 EITHER A COMPETITIVE TRANSITION CHARGE OR AN INTANGIBLE 9 TRANSITION CHARGE OR UNTIL 100% OF ITS CUSTOMERS HAVE CHOICE, 10 WHICHEVER IS LONGER, THE ELECTRIC DISTRIBUTION COMPANY SHALL 11 CONTINUE TO HAVE THE FULL OBLIGATION TO SERVE, INCLUDING THE 12 CONNECTION OF CUSTOMERS, THE DELIVERY OF ELECTRIC ENERGY AND 13 THE PRODUCTION OR ACQUISITION OF ELECTRIC ENERGY FOR 14 CUSTOMERS. 15 [(2) AT THE END OF THE TRANSITION PERIOD, THE COMMISSION 16 SHALL PROMULGATE REGULATIONS TO DEFINE THE ELECTRIC 17 DISTRIBUTION COMPANY'S OBLIGATION TO CONNECT AND DELIVER AND 18 ACQUIRE ELECTRICITY UNDER PARAGRAPH (3) THAT WILL EXIST AT 19 THE END OF THE PHASE-IN PERIOD. 20 (3) IF A CUSTOMER CONTRACTS FOR ELECTRIC ENERGY AND IT 21 IS NOT DELIVERED OR IF A CUSTOMER DOES NOT CHOOSE AN 22 ALTERNATIVE ELECTRIC GENERATION SUPPLIER, THE ELECTRIC 23 DISTRIBUTION COMPANY OR COMMISSION-APPROVED ALTERNATIVE 24 SUPPLIER SHALL ACQUIRE ELECTRIC ENERGY AT PREVAILING MARKET 25 PRICES TO SERVE THAT CUSTOMER AND SHALL RECOVER FULLY ALL 26 REASONABLE COSTS.] 27 (3.1) FOLLOWING THE EXPIRATION OF AN ELECTRIC 28 DISTRIBUTION COMPANY'S OBLIGATION TO PROVIDE ELECTRIC 29 GENERATION SUPPLY SERVICE TO RETAIL CUSTOMERS AT CAPPED 30 RATES, IF A CUSTOMER CONTRACTS FOR ELECTRIC GENERATION SUPPLY 20080H2200B4526 - 63 -
1 SERVICE AND THE CHOSEN ELECTRIC GENERATION SUPPLIER DOES NOT 2 PROVIDE THE SERVICE OR IF A CUSTOMER DOES NOT CHOOSE AN 3 ALTERNATIVE ELECTRIC GENERATION SUPPLIER, THE DEFAULT SERVICE 4 PROVIDER SHALL PROVIDE ELECTRIC GENERATION SUPPLY SERVICE TO 5 THAT CUSTOMER PURSUANT TO A COMMISSION-APPROVED COMPETITIVE 6 PROCUREMENT PLAN. THE ELECTRIC POWER ACQUIRED SHALL BE 7 PROCURED THROUGH COMPETITIVE PROCUREMENT PROCESSES AND SHALL 8 INCLUDE ONE OR MORE OF THE FOLLOWING: 9 (I) AUCTIONS. 10 (II) REQUESTS FOR PROPOSAL. 11 (III) BILATERAL AGREEMENTS ENTERED INTO AT THE SOLE 12 DISCRETION OF THE DEFAULT SERVICE PROVIDER WHICH SHALL BE 13 AT PRICES WHICH ARE: 14 (A) NO GREATER THAN THE COST OF OBTAINING 15 GENERATION UNDER COMPARABLE TERMS IN THE WHOLESALE 16 MARKET, AS DETERMINED BY THE COMMISSION AT THE TIME 17 OF EXECUTION OF THE CONTRACT; OR 18 (B) CONSISTENT WITH A COMMISSION-APPROVED 19 COMPETITION PROCUREMENT PROCESS. ANY AGREEMENT 20 BETWEEN AFFILIATED PARTIES SHALL BE SUBJECT TO REVIEW 21 AND APPROVAL OF THE PENNSYLVANIA PUBLIC UTILITY 22 COMMISSION UNDER CHAPTER 21 (RELATING TO RELATIONS 23 WITH AFFILIATED INTERESTS). IN NO CASE SHALL THE COST 24 OF OBTAINING GENERATION FROM ANY AFFILIATED INTEREST 25 BE GREATER THAN THE COST OF OBTAINING GENERATION 26 UNDER COMPARABLE TERMS IN THE WHOLESALE MARKET AT THE 27 TIME OF EXECUTION OF THE CONTRACT. 28 (3.2) THE ELECTRIC POWER PROCURED PURSUANT TO PARAGRAPH 29 (3.1) SHALL INCLUDE A PRUDENT MIX OF THE FOLLOWING: 30 (I) SPOT MARKET PURCHASES. 20080H2200B4526 - 64 -
1 (II) SHORT-TERM CONTRACTS. 2 (III) LONG-TERM PURCHASE CONTRACTS, ENTERED INTO AS 3 A RESULT OF AN AUCTION, REQUEST FOR PROPOSAL OR BILATERAL 4 CONTRACT THAT IS FREE OF UNDUE INFLUENCE, DURESS OR 5 FAVORITISM, OF MORE THAN FOUR AND NOT MORE THAN 20 YEARS. 6 THE DEFAULT SERVICE PROVIDER SHALL HAVE SOLE DISCRETION 7 TO DETERMINE THE SOURCE AND FUEL TYPE. LONG-TERM PURCHASE 8 CONTRACTS UNDER THIS SUBPARAGRAPH MAY NOT CONSTITUTE MORE 9 THAN 25% OF THE DEFAULT SERVICE PROVIDER'S PROJECTED 10 DEFAULT SERVICE LOAD UNLESS THE COMMISSION, AFTER A 11 HEARING, DETERMINES FOR GOOD CAUSE THAT A GREATER PORTION 12 OF LOAD IS NECESSARY TO ACHIEVE LEAST COST PROCUREMENT. 13 THIS SUBPARAGRAPH SHALL NOT APPLY TO CONTRACTS EXECUTED 14 UNDER PARAGRAPH (5). 15 (3.3) THE COMMISSION MAY DETERMINE THAT A CONTRACT IS 16 REQUIRED TO BE EXTENDED FOR A LONGER TERM OF UP TO 20 YEARS, 17 IF THE EXTENSION IS NECESSARY TO ENSURE ADEQUATE AND RELIABLE 18 SERVICE AT LEAST COST TO CUSTOMERS OVER TIME. 19 (3.4) THE PRUDENT MIX OF CONTRACTS ENTERED INTO PURSUANT 20 TO PARAGRAPHS (3.2) AND (3.3) SHALL BE DESIGNED TO ENSURE: 21 (I) ADEQUATE AND RELIABLE SERVICE. 22 (II) THE LEAST COST TO CUSTOMERS OVER TIME. 23 (III) COMPLIANCE WITH THE REQUIREMENTS OF PARAGRAPH 24 (3.1). 25 (3.5) EXCEPT AS SET FORTH IN PARAGRAPH (5)(II), THE 26 PROVISIONS OF THIS SECTION SHALL APPLY TO ANY TYPE OF ENERGY 27 PURCHASED BY A DEFAULT SERVICE PROVIDER TO PROVIDE ELECTRIC 28 GENERATION SUPPLY SERVICE, INCLUDING ENERGY OR ALTERNATIVE 29 ENERGY PORTFOLIO STANDARDS CREDITS REQUIRED TO BE PURCHASED 30 UNDER THE ACT OF NOVEMBER 30, 2004 (P.L.1672, NO.213), KNOWN 20080H2200B4526 - 65 -
1 AS THE ALTERNATIVE ENERGY PORTFOLIO STANDARDS ACT. THE 2 COMMISSION SHALL APPLY PARAGRAPH (3.4) TO COMPARABLE TYPES OF 3 ENERGY SOURCES. 4 (3.6) THE DEFAULT SERVICE PROVIDER SHALL FILE A PLAN FOR 5 COMPETITIVE PROCUREMENT WITH THE COMMISSION AND OBTAIN 6 COMMISSION APPROVAL OF THE PLAN CONSIDERING THE STANDARDS IN 7 PARAGRAPHS (3.1), (3.2), (3.3) AND (3.4) BEFORE THE 8 COMPETITIVE PROCESS IS IMPLEMENTED. THE COMMISSION SHALL HOLD 9 HEARINGS AS NECESSARY ON THE PROPOSED PLAN. IF THE COMMISSION 10 FAILS TO ISSUE A FINAL ORDER ON THE PLAN WITHIN NINE MONTHS 11 OF THE DATE THAT THE PLAN IS FILED, THE PLAN SHALL BE DEEMED 12 TO BE APPROVED AND THE DEFAULT SERVICE PROVIDER MAY IMPLEMENT 13 THE PLAN AS FILED. COSTS INCURRED THROUGH AN APPROVED 14 COMPETITIVE PROCUREMENT PLAN SHALL BE DEEMED TO BE THE LEAST 15 COST OVER TIME AS REQUIRED UNDER PARAGRAPH (3.4)(II). 16 (3.7) AT THE TIME THE COMMISSION EVALUATES THE PLAN AND 17 PRIOR TO APPROVAL, IN DETERMINING IF THE DEFAULT ELECTRIC 18 SERVICE PROVIDER'S PLAN OBTAINS GENERATION SUPPLY AT THE 19 LEAST COST, THE COMMISSION SHALL CONSIDER THE DEFAULT SERVICE 20 PROVIDER'S OBLIGATION TO PROVIDE ADEQUATE AND RELIABLE 21 SERVICE TO CUSTOMERS AND THAT THE DEFAULT SERVICE PROVIDER 22 HAS OBTAINED A PRUDENT MIX OF CONTRACTS TO OBTAIN LEAST COST 23 ON A LONG-TERM, SHORT-TERM AND SPOT MARKET BASIS AND SHALL 24 MAKE SPECIFIC FINDINGS WHICH SHALL INCLUDE THE FOLLOWING: 25 (I) THE DEFAULT SERVICE PROVIDER'S PLAN INCLUDES 26 PRUDENT STEPS NECESSARY TO NEGOTIATE FAVORABLE GENERATION 27 SUPPLY CONTRACTS. 28 (II) THE DEFAULT SERVICE PROVIDER'S PLAN INCLUDES 29 PRUDENT STEPS NECESSARY TO OBTAIN LEAST COST GENERATION 30 SUPPLY CONTRACTS ON A LONG-TERM, SHORT-TERM AND SPOT 20080H2200B4526 - 66 -
1 MARKET BASIS. 2 (III) NEITHER THE DEFAULT SERVICE PROVIDER NOR ITS 3 AFFILIATED INTEREST HAS WITHHELD FROM THE MARKET ANY 4 GENERATION SUPPLY IN A MANNER THAT VIOLATES FEDERAL LAW. 5 (3.8) NOTWITHSTANDING SECTIONS 508 (RELATING TO POWER OF 6 COMMISSION TO VARY, REFORM AND REVISE CONTRACTS) AND 2102 7 (RELATING TO APPROVAL OF CONTRACTS WITH AFFILIATED 8 INTERESTS), THE COMMISSION MAY MODIFY CONTRACTS OR DISALLOW 9 COSTS ONLY WHEN THE PARTY SEEKING RECOVERY OF THE COSTS OF A 10 PROCUREMENT PLAN IS, AFTER HEARING, FOUND TO BE AT FAULT FOR 11 THE FOLLOWING: 12 (I) NOT COMPLYING WITH THE COMMISSION-APPROVED 13 PROCUREMENT PLAN; OR 14 (II) THE COMMISSION OF FRAUD, COLLUSION OR MARKET 15 MANIPULATION WITH REGARD TO THESE CONTRACTS. 16 (3.9) THE DEFAULT SERVICE PROVIDER SHALL HAVE THE RIGHT 17 TO RECOVER ON A FULL AND CURRENT BASIS, PURSUANT TO A 18 RECONCILABLE AUTOMATIC ADJUSTMENT CLAUSE UNDER SECTION 1307 19 (RELATING TO SLIDING SCALE OF RATES; ADJUSTMENTS), ALL 20 REASONABLE COSTS INCURRED UNDER THIS SECTION AND A 21 COMMISSION-APPROVED COMPETITIVE PROCUREMENT PLAN. 22 (4) IF A CUSTOMER THAT CHOOSES AN ALTERNATIVE SUPPLIER 23 AND SUBSEQUENTLY DESIRES TO RETURN TO THE LOCAL DISTRIBUTION 24 COMPANY FOR GENERATION SERVICE, THE LOCAL DISTRIBUTION 25 COMPANY SHALL TREAT THAT CUSTOMER EXACTLY AS IT WOULD ANY NEW 26 APPLICANT FOR ENERGY SERVICE. 27 (5) (I) NOTWITHSTANDING PARAGRAPH [(3)] (3.1), THE 28 ELECTRIC DISTRIBUTION COMPANY OR COMMISSION-APPROVED 29 ALTERNATIVE SUPPLIER MAY, IN ITS SOLE DISCRETION, OFFER 30 LARGE CUSTOMERS WITH A PEAK DEMAND OF 15 MEGAWATTS OR 20080H2200B4526 - 67 -
1 GREATER AT ONE METER AT A LOCATION IN ITS SERVICE 2 TERRITORY ANY NEGOTIATED RATE FOR SERVICE AT ALL OF THE 3 CUSTOMERS' LOCATIONS WITHIN THE SERVICE TERRITORY FOR ANY 4 DURATION AGREED UPON BY THE ELECTRIC DISTRIBUTION COMPANY 5 OR COMMISSION-APPROVED ALTERNATIVE SUPPLIER AND THE LARGE 6 CUSTOMER. THE COMMISSION SHALL PERMIT, BUT SHALL NOT 7 REQUIRE, AN ELECTRIC DISTRIBUTION COMPANY OR COMMISSION- 8 APPROVED ALTERNATIVE SUPPLIER TO PROVIDE SERVICE TO LARGE 9 CUSTOMERS UNDER THIS PARAGRAPH. CONTRACT RATES ENTERED 10 INTO UNDER THIS PARAGRAPH SHALL BE SUBJECT TO REVIEW BY 11 THE COMMISSION IN ORDER TO ENSURE THAT ALL COSTS RELATED 12 TO THE RATES ARE BORNE BY THE PARTIES TO THE CONTRACT AND 13 THAT NO COSTS RELATED TO THE RATES ARE BORNE BY OTHER 14 CUSTOMERS OR CUSTOMER CLASSES. IF NO COSTS RELATED TO THE 15 RATES ARE BORNE BY OTHER CUSTOMERS OR CUSTOMER CLASSES, 16 THE COMMISSION SHALL APPROVE THE CONTRACT WITHIN 90 DAYS 17 OF ITS FILING, OR IT SHALL BE DEEMED APPROVED BY 18 OPERATION OF LAW UPON EXPIRATION OF THE 90 DAYS. 19 INFORMATION SUBMITTED UNDER THIS PARAGRAPH SHALL BE 20 SUBJECT TO THE COMMISSION'S PROCEDURES FOR THE FILING OF 21 CONFIDENTIAL AND PROPRIETARY INFORMATION. 22 (II) FOR PURPOSES OF PROVIDING SERVICE UNDER THIS 23 PARAGRAPH TO CUSTOMERS WITH A PEAK DEMAND OF 20 MEGAWATTS 24 OR GREATER AT ONE METER AT A LOCATION WITHIN THAT 25 DISTRIBUTION COMPANY'S SERVICE TERRITORY, AN ELECTRIC 26 DISTRIBUTION COMPANY THAT HAS COMPLETED ITS RESTRUCTURING 27 TRANSITION PERIOD AS OF THE EFFECTIVE DATE OF THIS 28 PARAGRAPH MAY, IN ITS SOLE DISCRETION, ACQUIRE AN 29 INTEREST IN A GENERATION FACILITY OR CONSTRUCT A 30 GENERATION FACILITY SPECIFICALLY TO MEET THE ENERGY 20080H2200B4526 - 68 -
1 REQUIREMENTS OF THE CUSTOMERS, INCLUDING THE ELECTRIC 2 REQUIREMENTS OF THE CUSTOMERS' OTHER BILLING LOCATIONS 3 WITHIN ITS SERVICE TERRITORY. THE ELECTRIC DISTRIBUTION 4 COMPANY MUST COMMENCE CONSTRUCTION OF THE GENERATION 5 FACILITY OR CONTRACT TO ACQUIRE THE GENERATION INTEREST 6 WITHIN THREE YEARS AFTER THE EFFECTIVE DATE OF THIS 7 PARAGRAPH, EXCEPT THAT THE ELECTRIC DISTRIBUTION COMPANY 8 MAY ADD TO THE GENERATION FACILITIES IT COMMENCED 9 CONSTRUCTION OR CONTRACTED TO ACQUIRE AFTER THIS THREE- 10 YEAR PERIOD TO SERVE ADDITIONAL LOAD OF CUSTOMERS FOR 11 WHOM IT COMMENCED CONSTRUCTION OR CONTRACTED TO ACQUIRE 12 GENERATION WITHIN THREE YEARS. NOTHING IN THIS PARAGRAPH 13 REQUIRES OR AUTHORIZES THE COMMISSION TO REQUIRE AN 14 ELECTRIC DISTRIBUTION COMPANY TO COMMENCE CONSTRUCTION OR 15 ACQUIRE AN INTEREST IN A GENERATION FACILITY. THE 16 ELECTRIC DISTRIBUTION COMPANY'S INTEREST IN THE 17 GENERATION FACILITY IT BUILT OR CONTRACTED TO ACQUIRE 18 SHALL BE NO LARGER THAN NECESSARY TO MEET PEAK DEMAND OF 19 CUSTOMERS SERVED UNDER THIS SUBPARAGRAPH. DURING TIMES 20 WHEN THE CUSTOMER'S DEMAND IS LESS THAN THE ELECTRIC 21 DISTRIBUTION COMPANY'S GENERATION INTEREST, THE ELECTRIC 22 DISTRIBUTION COMPANY MAY SELL EXCESS POWER ON THE 23 WHOLESALE MARKET. AT NO TIME SHALL THE COSTS ASSOCIATED 24 WITH THE GENERATING FACILITY INTERESTS BE INCLUDED IN 25 RATE BASE OR OTHERWISE REFLECTED IN RATES. THE GENERATION 26 FACILITY INTERESTS SHALL NOT BE COMMISSION-REGULATED 27 ASSETS. 28 (6) A DEFAULT SERVICE PLAN APPROVED BY THE COMMISSION 29 PRIOR TO THE EFFECTIVE DATE OF THIS SECTION SHALL REMAIN IN 30 EFFECT THROUGH ITS APPROVED TERM. AT ITS SOLE DISCRETION, THE 20080H2200B4526 - 69 -
1 DEFAULT SERVICE PROVIDER MAY PROPOSE AMENDMENTS TO ITS 2 APPROVED PLAN THAT ARE CONSISTENT WITH THIS SECTION, AND THE 3 COMMISSION SHALL ISSUE A DECISION WHETHER TO APPROVE OR 4 DISAPPROVE THE PROPOSED AMENDMENTS WITHIN NINE MONTHS OF THE 5 DATE THAT THE AMENDMENTS ARE FILED. IF THE COMMISSION FAILS 6 TO ISSUE A FINAL ORDER WITHIN NINE MONTHS, THE AMENDMENTS 7 SHALL BE DEEMED TO BE APPROVED AND THE DEFAULT SERVICE 8 PROVIDER MAY IMPLEMENT THE AMENDMENTS AS FILED. 9 (7) THE DEFAULT SERVICE PROVIDER SHALL OFFER RESIDENTIAL 10 AND SMALL BUSINESS CUSTOMERS A GENERATION SUPPLY SERVICE RATE 11 THAT SHALL CHANGE NO MORE FREQUENTLY THAN ON A QUARTERLY 12 BASIS. ALL DEFAULT SERVICE RATES SHALL BE REVIEWED BY THE 13 COMMISSION TO ENSURE THAT THE COSTS OF PROVIDING SERVICE TO 14 EACH CUSTOMER CLASS ARE NOT SUBSIDIZED BY ANY OTHER CLASS. 15 (F) SMART METER TECHNOLOGY AND TIME OF USE RATES.-- 16 (1) WITHIN NINE MONTHS AFTER THE EFFECTIVE DATE OF THIS 17 PARAGRAPH, ELECTRIC DISTRIBUTION COMPANIES SHALL FILE A SMART 18 METER TECHNOLOGY PROCUREMENT AND INSTALLATION PLAN WITH THE 19 COMMISSION FOR APPROVAL. THE PLAN SHALL DESCRIBE THE SMART 20 METER TECHNOLOGIES THE ELECTRIC DISTRIBUTION COMPANY PROPOSES 21 TO INSTALL IN ACCORDANCE WITH PARAGRAPH (2). 22 (2) ELECTRIC DISTRIBUTION COMPANIES SHALL FURNISH SMART 23 METER TECHNOLOGY AS FOLLOWS: 24 (I) UPON REQUEST FROM A CUSTOMER THAT AGREES TO PAY 25 THE COST OF THE SMART METER AT THE TIME OF THE REQUEST. 26 (II) IN NEW BUILDING CONSTRUCTION. 27 (III) IN ACCORDANCE WITH A DEPRECIATION SCHEDULE NOT 28 TO EXCEED 15 YEARS. 29 (3) ELECTRIC DISTRIBUTION COMPANIES SHALL, WITH CUSTOMER 30 CONSENT, MAKE AVAILABLE DIRECT METER ACCESS AND ELECTRONIC 20080H2200B4526 - 70 -
1 ACCESS TO CUSTOMER METER DATA TO THIRD PARTIES, INCLUDING 2 ELECTRIC GENERATION SUPPLIERS AND PROVIDERS OF CONSERVATION 3 AND LOAD MANAGEMENT SERVICES. 4 (4) IN NO EVENT SHALL LOST OR DECREASED REVENUES BY AN 5 ELECTRIC DISTRIBUTION COMPANY DUE TO REDUCED ELECTRICITY 6 CONSUMPTION OR SHIFTING ENERGY DEMAND BE CONSIDERED ANY OF 7 THE FOLLOWING: 8 (I) A COST OF SMART METER TECHNOLOGY RECOVERABLE 9 UNDER A RECONCILABLE AUTOMATIC ADJUSTMENT CLAUSE UNDER 10 SECTION 1307(B), EXCEPT THAT DECREASED REVENUES AND 11 REDUCED ENERGY CONSUMPTION MAY BE REFLECTED IN THE 12 REVENUE AND SALES DATA USED TO CALCULATE RATES IN A 13 DISTRIBUTION RATE BASE RATE PROCEEDING FILED UNDER 14 SECTION 1308 (RELATING TO VOLUNTARY CHANGE IN RATES). 15 (II) A RECOVERABLE COST. 16 (5) BY JANUARY 1, 2010, OR AT THE END OF THE APPLICABLE 17 GENERATION RATE CAP PERIOD, WHICHEVER IS LATER, A DEFAULT 18 SERVICE PROVIDER SHALL SUBMIT TO THE COMMISSION ONE OR MORE 19 PROPOSED TIME-OF-USE RATES AND REAL-TIME PRICE PLANS. THE 20 COMMISSION SHALL APPROVE OR MODIFY THE TIME-OF-USE RATES AND 21 REAL-TIME PRICE PLAN WITHIN SIX MONTHS OF SUBMITTAL. THE 22 DEFAULT SERVICE PROVIDER SHALL OFFER THE TIME-OF-USE RATES 23 AND REAL-TIME PRICE PLAN TO ALL CUSTOMERS THAT HAVE BEEN 24 PROVIDED WITH SMART METER TECHNOLOGY UNDER PARAGRAPH 25 (2)(III). RESIDENTIAL OR COMMERCIAL CUSTOMERS MAY ELECT TO 26 PARTICIPATE IN TIME-OF-USE RATES OR REAL-TIME PRICING. THE 27 DEFAULT SERVICE PROVIDER SHALL SUBMIT AN ANNUAL REPORT TO THE 28 PRICE PROGRAMS AND THE EFFICACY OF THE PROGRAMS IN AFFECTING 29 ENERGY DEMAND AND CONSUMPTION AND THE EFFECT ON WHOLESALE 30 MARKET PRICES. 20080H2200B4526 - 71 -
1 (6) THE PROVISIONS OF THIS SUBSECTION SHALL NOT APPLY TO 2 AN ELECTRIC DISTRIBUTION COMPANY WITH 100,000 OR FEWER 3 CUSTOMERS. 4 (7) AN ELECTRIC DISTRIBUTION COMPANY MAY RECOVER 5 REASONABLE AND PRUDENT COSTS OF PROVIDING SMART METER 6 TECHNOLOGY UNDER PARAGRAPH (2)(II) AND (III), AS DETERMINED 7 BY THE COMMISSION. THIS PARAGRAPH INCLUDES ANNUAL 8 DEPRECIATION AND CAPITAL COSTS OVER THE LIFE OF THE SMART 9 METER TECHNOLOGY AND THE COST OF ANY SYSTEM UPGRADES THAT THE 10 ELECTRIC DISTRIBUTION COMPANY MAY REQUIRE TO ENABLE THE USE 11 OF THE SMART METER TECHNOLOGY WHICH ARE INCURRED AFTER THE 12 EFFECTIVE DATE OF THIS PARAGRAPH LESS OPERATING AND CAPITAL 13 COST SAVINGS REALIZED BY THE ELECTRIC DISTRIBUTION COMPANY 14 FROM THE INSTALLATION AND USE OF THE SMART METER TECHNOLOGY. 15 SMART METER TECHNOLOGY SHALL BE DEEMED TO BE A NEW SERVICE 16 OFFERED FOR THE FIRST TIME UNDER SECTION 2804(4)(VI). AN 17 ELECTRIC DISTRIBUTION COMPANY MAY RECOVER SMART METER 18 TECHNOLOGY COSTS: 19 (I) THROUGH BASE RATES, INCLUDING A DEFERRAL FOR 20 FUTURE BASE RATE RECOVERY OF CURRENT BASIS WITH CARRYING 21 CHARGE AS DETERMINED BY THE COMMISSION; OR 22 (II) ON A FULL AND CURRENT BASIS THROUGH A 23 RECONCILABLE AUTOMATIC ADJUSTMENT CLAUSE UNDER SECTION 24 1307. 25 (G) DEFINITION.--AS USED IN THIS SECTION, THE TERM "SMART 26 METER TECHNOLOGY" MEANS TECHNOLOGY, INCLUDING METERING 27 TECHNOLOGY AND NETWORK COMMUNICATIONS TECHNOLOGY CAPABLE OF 28 BIDIRECTIONAL COMMUNICATION, THAT RECORDS ELECTRICITY USAGE ON 29 AT LEAST AN HOURLY BASIS, INCLUDING RELATED ELECTRIC 30 DISTRIBUTION SYSTEM UPGRADES TO ENABLE THE TECHNOLOGY. THE 20080H2200B4526 - 72 -
1 TECHNOLOGY SHALL PROVIDE CUSTOMERS WITH DIRECT ACCESS TO AND USE 2 OF PRICE AND CONSUMPTION INFORMATION. THE TECHNOLOGY SHALL ALSO: 3 (1) DIRECTLY PROVIDE CUSTOMERS WITH INFORMATION ON THEIR 4 HOURLY CONSUMPTION. 5 (2) ENABLE TIME-OF-USE RATES AND REAL-TIME PRICE 6 PROGRAMS. 7 (3) EFFECTIVELY SUPPORT THE AUTOMATIC CONTROL OF THE 8 CUSTOMER'S ELECTRICITY CONSUMPTION BY ONE OR MORE OF THE 9 FOLLOWING AS SELECTED BY THE CUSTOMER: 10 (I) THE CUSTOMER; 11 (II) THE CUSTOMER'S UTILITY; OR 12 (III) A THIRD PARTY ENGAGED BY THE CUSTOMER OR THE 13 CUSTOMER'S UTILITY. 14 SECTION 4. SECTION 2811 OF TITLE 66 IS AMENDED BY ADDING A 15 SUBSECTION TO READ: 16 § 2811. MARKET POWER REMEDIATION. 17 * * * 18 (E.1) MARKET MISCONDUCT.-- 19 (1) IF AN ELECTRIC DISTRIBUTION COMPANY OR ANY OF ITS 20 AFFILIATED COMPANIES OR ANY COMPANY THAT AN ELECTRIC 21 DISTRIBUTION COMPANY HAS PURCHASED GENERATION FROM IS FOUND 22 GUILTY OF MARKET MANIPULATION, EXERCISING MARKET POWER OR 23 COLLUSION BY THE FEDERAL ENERGY REGULATORY COMMISSION OR ANY 24 FEDERAL OR STATE COURT OR, IF AN ELECTRIC DISTRIBUTION 25 COMPANY OR ANY ONE OF ITS AFFILIATED COMPANIES OR ANY COMPANY 26 THAT AN ELECTRIC DISTRIBUTION COMPANY HAS PURCHASED 27 GENERATION FROM SETTLES A CLAIM OF MARKET MANIPULATION, 28 EXERCISING MARKET POWER OR COLLUSION THAT IS BROUGHT BY A 29 REGIONAL TRANSMISSION OPERATOR'S MARKET MONITORING UNIT, THE 30 FEDERAL ENERGY REGULATORY COMMISSION OR ANOTHER ENTITY, THE 20080H2200B4526 - 73 -
1 COMMISSION: 2 (I) SHALL DIRECT THE ELECTRIC DISTRIBUTION COMPANY 3 TO TAKE ANY AND ALL REASONABLE ACTION TO QUANTIFY THE 4 EFFECT OF THE MARKET MISCONDUCT UPON PENNSYLVANIA 5 RATEPAYERS. 6 (II) FOLLOWING PUBLIC HEARING ON THE MATTER AND A 7 FINDING OF PUBLIC INTEREST, MAY DIRECT THE ELECTRIC 8 DISTRIBUTION COMPANY TO TAKE ANY AND ALL REASONABLE LEGAL 9 ACTION, INCLUDING THE FILING OF A LAWSUIT AS MAY BE 10 NECESSARY, TO RECOVER THE QUANTIFIED DAMAGES WHICH SHALL 11 BE USED TO RECOMPENSE PENNSYLVANIA RATEPAYERS AFFECTED BY 12 THE MARKET MISCONDUCT. 13 (2) IF THE ELECTRIC DISTRIBUTION COMPANY FAILS TO PURSUE 14 REASONABLE ACTION TO QUANTIFY OR SEEK RECOVERY OF DAMAGES FOR 15 PENNSYLVANIA RATEPAYERS AFFECTED BY MARKET MANIPULATION, THE 16 EXERCISE OF MARKET POWER OR COLLUSION, THE COMMISSION IS 17 AUTHORIZED, FOLLOWING NOTICE AND AN OPPORTUNITY OF THE 18 ELECTRIC DISTRIBUTION COMPANY TO COMPLY OR CONTEST, TO ASSESS 19 A CIVIL PENALTY, WHICH SHALL NOT BE RECOVERED IN RATES, OF 20 NOT MORE THAN $10,000 PER DAY FOR FAILURE OR NEGLECT TO OBEY 21 AN ORDER OF THE COMMISSION, THE CONTINUANCE OF THE FAILURE OR 22 NEGLECT BEING A SEPARATE OFFENSE. 23 (3) ANY MONETARY DAMAGES RECOVERED BY THE ELECTRIC 24 DISTRIBUTION COMPANY SHALL BE PAID TO AFFECTED PENNSYLVANIA 25 RATEPAYERS IN THE FORM OF A CREDIT TO THEIR ELECTRIC BILLS OR 26 AS REFUNDS. 27 (4) THE PROVISIONS OF THIS SUBSECTION SHALL BE HELD TO 28 BE IN ADDITION TO AND NOT IN SUBSTITUTION FOR OR LIMITATION 29 OF ANY OTHER PROVISIONS OF THIS TITLE. 30 * * * 20080H2200B4526 - 74 -
1 SECTION 5. TITLE 66 IS AMENDED BY ADDING SECTIONS TO READ: 2 § 2813. PROCUREMENT OF POWER. 3 EXCEPT AS PROVIDED UNDER THE ACT OF NOVEMBER 30, 2004 4 (P.L.1672, NO.213), KNOWN AS THE ALTERNATIVE ENERGY PORTFOLIO 5 STANDARDS ACT, THE COMMISSION MAY NOT ORDER A DEFAULT SERVICE 6 PROVIDER TO PROCURE POWER FROM A SPECIFIC GENERATION SUPPLIER, 7 FROM A SPECIFIC GENERATION FUEL TYPE OR FROM NEW GENERATION 8 ONLY. 9 § 2814. ADDITIONAL ALTERNATIVE ENERGY SOURCES. 10 (A) ALTERNATIVE ENERGY SOURCES.--THE TERM "ALTERNATIVE 11 ENERGY SOURCES" AS DEFINED UNDER SECTION 2 OF THE ACT OF 12 NOVEMBER 30, 2004 (P.L.1672, NO.213), KNOWN AS THE ALTERNATIVE 13 ENERGY PORTFOLIO STANDARDS ACT, SHALL ALSO INCLUDE LOW-IMPACT 14 HYDROPOWER CONSISTING OF ANY TECHNOLOGY THAT PRODUCES ELECTRIC 15 POWER AND THAT HARNESSES THE HYDROELECTRIC POTENTIAL OF MOVING 16 WATER IMPOUNDMENTS IF ONE OF THE FOLLOWING APPLIES: 17 (1) (I) THE HYDROPOWER SOURCE HAS A FEDERAL ENERGY 18 REGULATORY COMMISSION LICENSED CAPACITY OF 21 MEGAWATTS 19 OR LESS; AND 20 (II) THE LICENSE FOR THE HYDROPOWER SOURCE WAS 21 ISSUED BY THE FEDERAL ENERGY REGULATORY COMMISSION ON OR 22 PRIOR TO JANUARY 1, 1984, AND HELD ON JULY 1, 2007, IN 23 WHOLE OR IN PART BY A MUNICIPALITY LOCATED WHOLLY WITHIN 24 THIS COMMONWEALTH OR BY AN ELECTRIC COOPERATIVE 25 INCORPORATED IN THIS COMMONWEALTH. 26 (2) THE INCREMENTAL HYDROELECTRIC DEVELOPMENT: 27 (I) DOES NOT ADVERSELY CHANGE EXISTING IMPACTS TO 28 AQUATIC SYSTEMS; 29 (II) MEETS THE CERTIFICATION STANDARDS ESTABLISHED 30 BY THE LOW IMPACT HYDROPOWER INSTITUTE AND AMERICAN 20080H2200B4526 - 75 -
1 RIVERS, INC., OR THEIR SUCCESSORS; 2 (III) PROVIDES AN ADEQUATE WATER FLOW FOR PROTECTION 3 OF AQUATIC LIFE AND FOR SAFE AND EFFECTIVE FISH PASSAGE; 4 (IV) PROTECTS AGAINST EROSION; AND 5 (V) PROTECTS CULTURAL AND HISTORIC RESOURCES. 6 (B) BIOMASS.--THE TERM "BIOMASS ENERGY" AS DEFINED UNDER 7 SECTION 2 OF THE ALTERNATIVE ENERGY PORTFOLIO STANDARDS ACT 8 SHALL ALSO INCLUDE THE GENERATION OF ELECTRICITY UTILIZING BY- 9 PRODUCTS OF THE PULPING PROCESS AND WOOD MANUFACTURING PROCESS, 10 INCLUDING BARK, WOOD CHIPS, SAWDUST AND LIGNINS IN SPENT PULPING 11 LIQUORS. ELECTRICITY FROM BIOMASS ENERGY UNDER THIS SUBSECTION 12 GENERATED INSIDE THIS COMMONWEALTH SHALL BE ELIGIBLE AS A TIER I 13 ALTERNATIVE ENERGY SOURCE. ELECTRICITY FROM BIOMASS ENERGY UNDER 14 THIS SUBSECTION GENERATED OUTSIDE THIS COMMONWEALTH SHALL BE 15 ELIGIBLE AS A TIER II ALTERNATIVE ENERGY SOURCE. 16 (C) INCREASE IN TIER I.--THE COMMISSION SHALL AT LEAST 17 QUARTERLY INCREASE THE PERCENTAGE SHARE OF TIER I ALTERNATIVE 18 ENERGY SOURCES REQUIRED TO BE SOLD BY AN ELECTRIC DISTRIBUTION 19 COMPANY OR ELECTRIC GENERATION SUPPLIER UNDER SECTION 3(B)(1) OF 20 THE ALTERNATIVE ENERGY PORTFOLIO STANDARDS ACT TO REFLECT ANY 21 NEW BIOMASS ENERGY OR LOW-IMPACT HYDROPOWER RESOURCES THAT 22 QUALIFY AS A TIER I ALTERNATIVE ENERGY SOURCE UNDER THIS 23 SECTION. NO NEW RESOURCE QUALIFYING AS BIOMASS ENERGY OR LOW- 24 IMPACT HYDROPOWER UNDER THIS SECTION SHALL BE ELIGIBLE TO 25 GENERATE TIER I ALTERNATIVE ENERGY CREDITS UNTIL THE COMMISSION 26 HAS INCREASED THE PERCENTAGE SHARE OF TIER I TO REFLECT THESE 27 ADDITIONAL RESOURCES. 28 § 2815. CARBON DIOXIDE SEQUESTRATION NETWORK. 29 (A) ASSESSMENT.-- 30 (1) BY APRIL 1, 2009, THE DEPARTMENT SHALL COMPLETE A 20080H2200B4526 - 76 -
1 STUDY TO IDENTIFY SUITABLE GEOLOGICAL FORMATIONS, INCLUDING 2 SITES WITHIN OR IN PROXIMITY TO THE MEDINA, TUSCARORA OR 3 ORISKANY SANDSTONE FORMATION FOR THE LOCATION OF A STATE 4 NETWORK. 5 (2) BY JUNE 1, 2009, THE DEPARTMENT, IN CONSULTATION 6 WITH THE COMMISSION, SHALL HIRE ONE OR MORE INDEPENDENT 7 EXPERTS PURSUANT TO 62 PA.C.S. PT. I (RELATING TO 8 COMMONWEALTH PROCUREMENT CODE), AS NECESSARY, TO CONDUCT AN 9 ASSESSMENT OF THE FOLLOWING: 10 (I) ESTIMATES OF CAPITAL REQUIREMENTS AND 11 EXPENDITURES NECESSARY FOR THE ESTABLISHMENT, OPERATION 12 AND MAINTENANCE OF A STATE NETWORK. 13 (II) THE COLLECTION OF DATA TO ALLOW A SAFETY 14 ASSESSMENT. 15 (III) AN ASSESSMENT OF ALL POTENTIAL RISK TO 16 INDIVIDUALS, PROPERTY AND THE ENVIRONMENT ASSOCIATED WITH 17 THE GEOLOGICAL SEQUESTRATION OF CARBON DIOXIDE IN A STATE 18 NETWORK. THE ASSESSMENT, WHICH SHALL BE COMPLETED BY 19 OCTOBER 1, 2009, SHALL INCLUDE AN ANALYSIS OF THE 20 FOLLOWING: 21 (A) EXISTING FEDERAL AND STATE REGULATORY 22 STANDARDS FOR THE STORAGE OF CARBON DIOXIDE. 23 (B) FACTORS CONTAINED IN THE UNITED STATES 24 ENVIRONMENTAL PROTECTION AGENCY'S VULNERABILITY 25 EVALUATION FRAMEWORK FOR GEOLOGIC SEQUESTRATION OF 26 CARBON DIOXIDE (EPA 430-R-08-009, DATED JULY 10, 27 2008). 28 (C) THE DIFFERENT TYPES OF INSURANCE, BONDS, 29 OTHER INSTRUMENTS AND RECOMMENDED LEVELS OF INSURANCE 30 WHICH SHOULD BE CARRIED BY THE OPERATOR OF THE STATE 20080H2200B4526 - 77 -
1 NETWORK DURING THE CONSTRUCTION AND OPERATION OF THE 2 STATE NETWORK. 3 (D) THE AVAILABILITY OF COMMERCIAL INSURANCE. 4 (E) MODELS FOR THE ESTABLISHMENT OF A 5 COMMONWEALTH FUND TO PROVIDE PROTECTION AGAINST RISK 6 TO BE FUNDED BY THE OPERATOR. 7 (B) TRANSMISSION OF STUDY AND ASSESSMENT.-- 8 (1) THE DEPARTMENT SHALL SUBMIT THE STUDY CONDUCTED 9 UNDER SUBSECTION (A)(1) TO THE GOVERNOR, THE CHAIRMAN AND 10 MINORITY CHAIRMAN OF THE ENVIRONMENTAL RESOURCES AND ENERGY 11 COMMITTEE OF THE SENATE, THE CHAIRMAN AND MINORITY CHAIRMAN 12 OF THE ENVIRONMENTAL RESOURCES AND ENERGY COMMITTEE OF THE 13 HOUSE OF REPRESENTATIVES AND THE DEPARTMENT NO LATER THAN MAY 14 1, 2009. 15 (2) THE INDEPENDENT EXPERT SHALL SUBMIT THE FINAL 16 ASSESSMENT UNDER SUBSECTION (A)(2) TO THE GOVERNOR, THE 17 CHAIRMAN AND MINORITY CHAIRMAN OF THE ENVIRONMENTAL RESOURCES 18 AND ENERGY COMMITTEE OF THE SENATE, THE CHAIRMAN AND MINORITY 19 CHAIRMAN OF THE ENVIRONMENTAL RESOURCES AND ENERGY COMMITTEE 20 OF THE HOUSE OF REPRESENTATIVES AND THE DEPARTMENT NO LATER 21 THAN NOVEMBER 1, 2009. 22 (C) DEPARTMENT.--THE FOLLOWING SHALL APPLY: 23 (1) THE DEPARTMENT SHALL REVIEW THE ASSESSMENT SUBMITTED 24 UNDER SUBSECTION (A)(2) AND ALL GEOLOGIC SEQUESTRATION 25 REQUIREMENTS ASSOCIATED WITH A STATE NETWORK, INCLUDING 26 GEOLOGICAL SITE CHARACTERIZATION, MODELING AND VERIFICATION 27 OF FLUID MOVEMENT, CORRECTIVE ACTION, WELL CONSTRUCTION, 28 OPERATION, MECHANICAL INTEGRITY TESTING, MONITORING AND SITE 29 CLOSURE. 30 (2) FOLLOWING THE REVIEW UNDER PARAGRAPH (1), THE 20080H2200B4526 - 78 -
1 DEPARTMENT MAY CONDUCT A PILOT PROJECT TO DETERMINE THE 2 VIABILITY OF ESTABLISHING A STATE NETWORK IN THIS 3 COMMONWEALTH. 4 (D) DEFINITIONS.--AS USED IN THIS SECTION, THE FOLLOWING 5 WORDS AND PHRASES SHALL HAVE THE MEANINGS GIVEN TO THEM IN THIS 6 SUBSECTION: 7 "CARBON DIOXIDE SEQUESTRATION." THE STORAGE OF CARBON 8 DIOXIDE IN A SUPERCRITICAL PHASE WITHIN A GEOLOGICAL SUBSURFACE 9 FORMATION SUCH AS A DEEP SALINE AQUIFER WITH SUITABLE CAP ROCK, 10 SEALING FAULTS AND ANTICLINES THAT INCLUDES COMPRESSION, 11 DEHYDRATION AND LEAK DETECTION MONITORING EQUIPMENT AND 12 PIPELINES TO TRANSPORT CARBON DIOXIDE CAPTURED BY AN ADVANCED 13 COAL COMBUSTION WITH LIMITED CARBON EMISSIONS PLANT TO AN 14 UNDERGROUND STORAGE SITE. THE TERM SHALL NOT INCLUDE USE OF THE 15 CARBON DIOXIDE FOR ENHANCED OIL RECOVERY. 16 "DEPARTMENT." THE DEPARTMENT OF CONSERVATION AND NATURAL 17 RESOURCES OF THE COMMONWEALTH. 18 "STATE NETWORK." A CARBON DIOXIDE SEQUESTRATION NETWORK 19 ESTABLISHED ON LANDS OWNED BY THE COMMONWEALTH, OR LANDS ON 20 WHICH THE COMMONWEALTH HAS ACQUIRED THE RIGHT TO STORE CARBON 21 DIOXIDE, THAT HAVE BEEN DESIGNATED BY THE DEPARTMENT OF 22 CONSERVATION AND NATURAL RESOURCES FOR THE STORAGE OF CARBON 23 DIOXIDE. 24 SECTION 6. THIS ACT SHALL TAKE EFFECT IN 30 DAYS. A11L66GRH/20080H2200B4526 - 79 -