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2008 SESSION

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HB 543 Natural gas utilities; alternative ratemaking plan, report.

Introduced by: Samuel A. Nixon, Jr. | all patrons    ...    notes | add to my profiles | history

SUMMARY AS PASSED:

Natural gas utilities; alternative ratemaking plan. Authorizes any natural gas utility to file a conservation and ratemaking efficiency plan that includes (i) a normalization component that removes the effect of weather from the determination of conservation and energy efficiency results, (ii) a decoupling mechanism, (iii) cost-effective conservation and energy efficiency programs, (iv) provisions to address the needs of low-income or low-usage residential consumers, and (v) provisions to ensure that the rates and service to nonparticipating classes of customers are not adversely impacted. Such plans may include one or more residential, small commercial, or small general service classes, but shall not apply to large commercial or large industrial customer classes. The State Corporation Commission (SCC) is required to allow a utility that implements a plan to recover, through its regulated rates, its costs, together with a return thereon, associated with cost-effective conservation and energy efficiency programs. Utilities that demonstrate certain reductions in annualized, weather-normalized usage per customer will receive the opportunity to earn an incentive of up to 15 percent share of the independently verified net economic benefits created by the conservation and energy efficiency programs. The SCC is prohibited from reducing a utility's profit as a result of the implementation of a natural gas conservation and ratemaking efficiency plan. The SCC is required to report annually on the implementation of the measure.

SUMMARY AS PASSED HOUSE:

Natural gas utilities; alternative ratemaking plan.  Authorizes any natural gas utility to file a conservation and ratemaking efficiency plan that includes (i) a normalization component that removes the effect of weather from the determination of conservation and energy efficiency results, (ii) cost-effective conservation and energy efficiency programs, and (iii) provisions to address the needs of low-income or low-usage residential consumers. A conservation and ratemaking efficiency plan is a plan that includes a decoupling mechanism that decouples the recovery of a utility's allowed distribution revenue from the level of consumption of natural gas by its customers. Such plans may include one or more residential, small commercial, or small general service classes, but shall not apply to large commercial or large industrial customer classes. The State Corporation Commission (SCC) is required to allow a utility that implements a plan to recover, through its regulated rates, its costs, together with a return thereon, associated with cost-effective conservation and energy efficiency programs. Utilities that demonstrate certain reductions in annualized, weather-normalized usage per customer, will receive the opportunity to earn an incentive of 15 percent share of the independently verified net economic benefits created by the conservation and energy efficiency programs. The SCC is prohibited from reducing a utility's profit as a result of the implementation of a natural gas conservation and ratemaking efficiency plan. The SCC is required to report annually on the implementation of the measure.

SUMMARY AS INTRODUCED:

Natural gas utilities; alternative ratemaking plan.  Authorizes any natural gas utility to file a conservation and ratemaking efficiency plan that includes (i) a normalization component that removes the effect of weather from the determination of conservation and energy efficiency results and (ii) a mechanism that decouples the recovery of a utility's allowed distribution revenue from the level of consumption of natural gas by its customers. Such plans may include one or more residential, small commercial, or small general service classes, but shall not apply to large commercial or large industrial customer classes. The State Corporation Commission (SCC) is required to allow a utility that implements a plan to recover, through its regulated rates, its costs, together with a return thereon, associated with cost-effective conservation and energy efficiency programs. Utilities that demonstrate certain reductions in annualized, weather-normalized usage per customer, will receive an incentive of 10 percent of the net realized commodity savings. The SCC is prohibited from reducing a utility's profit as a result of the implementation of a natural gas conservation and ratemaking efficiency plan. The SCC shall consider authorizing a greater profit when a natural gas conservation and ratemaking efficiency plan is implemented in conjunction with a cost-of-service rate case or a performance-based regulation plan.