GOVERNOR'S RECOMMENDATION

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and to amend and reenact the third enactments of Chapter 888 and Chapter 933 of the Acts of Assembly of 2007,

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4. That the third enactment of Chapter 888 of the Acts of Assembly of 2007 is amended and reenacted as follows:

3. That it is in the public interest, and is consistent with the energy policy goals in § 67-102 of the Code of Virginia, to promote cost-effective conservation of energy through fair and effective demand side management, conservation, energy efficiency, and load management programs, including consumer education. These programs may include activities by electric utilities, public or private organizations, or both electric utilities and public or private organizations. The Commonwealth shall have a stated goal of reducing the consumption of electric energy by retail customers through the implementation of such programs by the year 2022 by an amount equal to ten percent of the amount of electric energy consumed by retail customers in 2006 by 2023 the 2008-2023 growth rate by 40 percent of (i) the summer peak load measured in megawatts and (ii) the annual net energy measured in gigawatt hours in the Virginia portion of each investor-owned public utility’s PJM geographic zone, as reported in the PJM Interconnection’s January, 2008, PJM Peak Load Forecast Report, Tables B-1 and E-1. The State Corporation Commission shall conduct a proceeding to (i) determine whether the ten-percent electric energy consumption reduction goal can be achieved cost-effectively through the operation of such programs, and if not, determine the appropriate goal for the year 2022 relative to base year of 2006, (ii) identify the mix of programs that should be implemented in the Commonwealth to cost-effectively achieve the defined electric energy consumption reduction goal by 2022, including but not limited to demand side management, conservation, energy efficiency, load management, real time pricing, and consumer education, (iii) develop a plan for the development and implementation of recommended programs, with incentives and alternative means of compliance to achieve such goals, (iv) determine the entity or entities that could most efficiently deploy and administer various elements of the plan, and (v) estimate the cost of attaining the energy consumption reduction goal. The Commission shall, on or before December 15, 2007, submit its findings and recommendations to the Governor and General Assembly, which shall include recommendations for any additional legislation necessary to implement the plan to meet the energy consumption reduction goal. In developing a plan to meet the goal, the Commission may consider providing for a public benefit fund and shall consider the fair and reasonable allocation by customer class of the incremental costs of meeting the goal that are recovered in accordance with subdivision A 5 b of § 56-585.1 of the Code of Virginia. When considering an application filed by an investor-owned incumbent electric utility or electrical cooperative for a certificate of public convenience and necessity to construct a new generation facility or for approval and certification of electric transmission facilities, and when assessing the need for such facility or facilities, the State Corporation Commission shall consider only the peak load reductions and net energy usage reductions reasonably expected to be achieved by utility-sponsored or supported demand side management and energy efficiency programs based on actual measured and verified reductions previously achieved, or on such other evidence that the Commission finds justifies such reasonable expectations.

5. That the third enactment of Chapter 933 of the Acts of Assembly of 2007 is amended and reenacted as follows:

3. That it is in the public interest, and is consistent with the energy policy goals in § 67-102 of the Code of Virginia, to promote cost-effective conservation of energy through fair and effective demand side management, conservation, energy efficiency, and load management programs, including consumer education. These programs may include activities by electric utilities, public or private organizations, or both electric utilities and public or private organizations. The Commonwealth shall have a stated goal of reducing the consumption of electric energy by retail customers through the implementation of such programs by the year 2022 by an amount equal to ten percent of the amount of electric energy consumed by retail customers in 2006 by 2023 the 2008-2023 growth rate by 40 percent of (i) the summer peak load measured in megawatts and (ii) the  annual net energy measured in gigawatt hours in the Virginia portion of each investor-owned public utility’s PJM geographic zone, as reported in the PJM Interconnection’s January, 2008, PJM Peak Load Forecast Report, Tables B-1 and E-1. The State Corporation Commission shall conduct a proceeding to (i) determine whether the ten percent electric energy consumption reduction goal can be achieved cost effectively through the operation of such programs, and if not, determine the appropriate goal for the year 2022 relative to base year of 2006, (ii) identify the mix of programs that should be implemented in the Commonwealth to cost effectively achieve the defined electric energy consumption reduction goal by 2022, including but not limited to demand side management, conservation, energy efficiency, load management, real time pricing, and consumer education, (iii) develop a plan for the development and implementation of recommended programs, with incentives and alternative means of compliance to achieve such goals, (iv) determine the entity or entities that could most efficiently deploy and administer various elements of the plan, and (v) estimate the cost of attaining the energy consumption reduction goal. The Commission shall, on or before December 15, 2007, submit its findings and recommendations to the Governor and General Assembly, which shall include recommendations for any additional legislation necessary to implement the plan to meet the energy consumption reduction goal. In developing a plan to meet the goal, the Commission may consider providing for a public benefit fund and shall consider the fair and reasonable allocation by customer class of the incremental costs of meeting the goal that are recovered in accordance with subdivision A 5 b of § 56-585.1 of the Code of Virginia. When considering an application filed by an investor-owned incumbent electric utility or electrical cooperative for a certificate of public convenience and necessity to construct a new generation facility or for approval and certification of electric transmission facilities, and when assessing the need for such facility or facilities, the State Corporation Commission shall consider only the peak load reductions and net energy usage reductions reasonably expected to be achieved by utility-sponsored or supported demand side management and energy efficiency programs based on actual measured and verified reductions previously achieved, or on such other evidence that the Commission finds justifies such reasonable expectations.