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1998 SESSION
988634408Patrons-- Plum, Bennett, Callahan, Cantor, Hall, Hargrove, Jones, J.C., Parrish, Purkey, Robinson, Scott, Tata and Wagner; Senators: Saslaw and Stolle
Be it enacted by the General Assembly of Virginia:
1. That the Code of Virginia is amended by adding in Title 56 a chapter numbered 23, containing articles numbered 1 through 4, consisting of sections numbered 56-576 through 56-591, as follows:
§ 56-576. Short title.
This chapter may be cited as the "Electric Energy Wholesale Competition and Economic Development Act of 1998."
§ 56-577. Definitions.
As used in this chapter:
"Affiliate" means any person that controls, is controlled by, or is under common control with an electric utility.
"Distribute," distributing" or "distribution of" electric energy means the transfer of electric energy through a retail distribution system to a retail customer.
"Distributor" means a person owning, controlling, or operating a retail distribution system to provide electric energy directly to retail customers in the Commonwealth.
"Electric utility" means any person that generates, transmits, or distributes electric energy for use by retail customers in the Commonwealth, including any investor-owned electric utility, cooperative electric utility, or electric utility owned or operated by a municipality.
"Generate," "generating," or "generation of" electric energy means the production of electric energy.
"Generator" means a person owning, controlling, or operating a facility that produces electric energy for sale.
"Incumbent electric utility" means each electric utility in the Commonwealth that, prior to July 1, 1998, supplied electric energy to retail customers located in an exclusive service territory established by the Commission.
"Investments and commitments in generation assets" means all of an incumbent electric utility's such investments or other commitments, including, but not limited to (i) electric energy generating units owned in whole or in part by the incumbent electric utility, (ii) all costs associated with all nonutility and utility power purchase contracts entered into by an incumbent electric utility, (iii) all costs associated with federal or state requirements for decommissioning nuclear electric energy generating units and costs associated with decommissioning requirements beyond the minimum requirements imposed by the Nuclear Regulatory Commission, (iv) all costs associated with federal or state action or inaction, including federal or state environmental protection requirements, and (v) all related regulatory assets.
"Municipality" means a city, county, town, authority or other political subdivision of the Commonwealth.
"Nonbypassable wires charge" means a charge that represents a retail customer's share of the costs recoverable by an electric utility as provided in this chapter.
"Person" means any individual, corporation, partnership, association, company, business, trust, joint venture, or other private legal entity, and the Commonwealth or any municipality.
"Regulatory assets" means previously deferred, generation-related costs incurred by a regulated electric utility in providing electric energy. "Regulatory assets" represent the effect of actions of a regulator, regardless of their classification in financial statements, and therefore include items such as (i) the cumulative difference between recorded depreciation and generally accepted methods of depreciation and (ii) the assets or obligations associated with the prior service cost component of pensions and other post-employment benefits costs.
"Related distribution service" means any billing, metering, collections, remittance, outage call, new connection, or other service or equipment that is necessary to provide retail electric energy directly to a retail customer.
"Retail customer" means any person that purchases retail electric energy at a single metering point or non-metered point of delivery located in the Commonwealth.
"Retail distribution system" means the electric energy facilities and related distribution services required for the distribution of electric energy to retail customers.
"Retail electric energy" means electric energy sold for ultimate consumption by a retail customer.
"Supplier" means any generator or other person that offers to sell or sells electric energy to a distributor in the Commonwealth.
"Supply" or "supplying" electric energy means the sale of or the offer to sell electric energy to a distributor in the Commonwealth.
"Transmission of," "transmit," or "transmitting" electric energy means the transfer of electric energy through the Commonwealth's interconnected transmission grid from a generator to either a distributor or a retail customer.
"Transmitter" means a person owning, controlling, or operating an electric energy transmission system, other than an independent system operator as provided in § 59-580.
§ 56-578. Applicability; municipalities.
A. This chapter shall apply to all electric utilities authorized to conduct business in the Commonwealth.
B. Notwithstanding subsection A of this section, this chapter shall not apply to an electric utility owned or operated by a municipality unless (i) that municipality elects to have this chapter apply to that utility or (ii) that utility sells, offers to sell or seeks to sell electric energy through a regional power exchange or to a supplier or distributor of electric energy. Any electric utility owned or operated by a municipality, whether or not subject to this chapter, may purchase electric energy through a regional power exchange or through a contract with a generator or supplier, subject to the rules and procedures adopted by the independent system operator serving that electric utility and the relevant regional power exchange, as provided in §§ 56-580 and 56-581.
§ 56-579. Transition to wholesale competition for the purchase and sale of electric energy; Commission authority.
A. The transition to wholesale competition for the purchase and sale of electric energy shall be implemented as follows:
1. On or before January 1, 1999, each electric utility subject to this chapter shall submit to the Commission (i) a transition plan relating to the implementation of wholesale competition for the purchase and sale of electric energy, as provided in § 56-582, and (ii) an application for a change of rates or an alternative rate plan for rates to be in effect through December 31, 2003, as provided in § 56-586.
2. On or before July 1, 2000, one or more independent system operators and one or more regional power exchanges shall be established, as provided in §§ 56-580 and 56-581, to facilitate a competitive market for the wholesale purchase and sale of electric energy in the Commonwealth.
3. Beginning on January 1, 2001, the non-nuclear generation of electric energy shall be deregulated as provided in § 56-583, and each distributor subject to the jurisdiction of the Commission shall purchase electric energy for its retail customers either through a regional power exchange or through a contract with a generator or other supplier.
4. Beginning on January 1, 2004, any rates for the generation of electric energy, established by the Commission under § 56-586, no longer shall be in effect, and each distributor shall be permitted to recover in full from its retail customers the costs of purchasing electric energy through a regional power exchange or through a contract with a generator or supplier for, and supplying that electric energy to, its retail customers, including operating expenses associated with that purchase and supply and such appropriate additional compensation as determined by the Commission.
B. The Commission may delay the implementation of wholesale competition for the purchase and sale of electric energy under subsection A of this section if it finds that such delay is necessitated by any action or inaction of the Federal Energy Regulatory Commission or any proceeding pending before the Supreme Court of Virginia relating to or arising out of this chapter.
C. The Commission shall have the authority, and shall promulgate such rules and regulations as are necessary, to implement the provisions of this section.
§ 56-580. Independent system operator.
A. By July 1, 2000, all incumbent electric utilities shall establish one or more independent system operators to coordinate and control the operation of the interconnected electric energy transmission grid system throughout, or in specified portions of, the Commonwealth, provided that all of the Commonwealth shall be served by an independent system operator. The establishment and operation of an independent system operator shall be subject to approval, to the extent required by federal law, by the Federal Energy Regulatory Commission and, to the extent not prohibited by federal law, by the Commission.
B. It shall be the duty and responsibility of each independent system operator to:
1. Manage and control the transmission of electric energy throughout, or in a specified portion of, the Commonwealth;
2. Provide reasonable and nondiscriminatory access to the transmission system under its management and control to all generators and suppliers who seek to sell electric energy through, or transmitters who seek to transmit electric energy to, distributors served by that transmission system;
3. Coordinate the scheduling and balancing of the transmission of electric energy and such other services as may be required in connection with the transmission of electric energy in the Commonwealth, including coordinating with all other independent system operators serving portions of the Commonwealth;
4. Preserve the reliability and integrity of the transmission system under its management and control;
5. Adopt rules and procedures for fulfilling the duties and responsibilities prescribed under this section, including establishing a managing board on which each incumbent investor-owned electric utility has one representative and other incumbent electric utilities are fairly represented;
6. Adopt minimum standards of training for employees who operate and maintain its facilities;
7. Procure all services required to fulfill such duties and responsibilities; and
8. Secure any approval from state and federal authorities that may be required to fulfill such duties and responsibilities.
C. No generator, supplier, transmitter or distributor of electric energy shall have an ownership interest in any independent system operator established under or authorized by this section.
D. To the extent that the costs to an incumbent electric utility or distributor of establishing and operating an independent system operator are not recovered from their retail customers through regulated rates, those costs shall be recovered through a nonbypassable wires charge to retail customers, as provided in § 56-591.
E. An independent system operator may, with unanimous approval by its managing board:
1. Merge with, join, or cede its authority to a similar entity if one should be established to manage and control the transmission of electric energy on a regional, statewide, or multi-state basis; and
2. Merge or combine with a regional power exchange established under § 56-581.
F. Each generator and other supplier selling electric energy to a distributor in any geographic area of the Commonwealth shall register with the independent system operator serving that area and comply with all rules, protocols and procedures adopted by that independent system operator.
§ 56-581. Regional power exchange.
A. By July 1, 2000, all incumbent electric utilities and all suppliers of electric energy seeking to do business in the Commonwealth shall establish one or more regional power exchanges to conduct statewide or regional competitive auctions of electric energy, open on a reasonable and nondiscriminatory basis to all generators and other suppliers of electric energy. The establishment and operation of a regional power exchange shall be subject to approval, to the extent not prohibited by federal law, by the Commission and, to the extent required by federal law, by the Federal Energy Regulatory Commission.
B. Each generator and other supplier that seeks to sell electric energy through a regional power exchange in the Commonwealth shall register with that regional power exchange and comply with all rules, protocols, and procedures adopted by that regional power exchange.
C. Each generator and other supplier that seeks to sell electric energy to a distributor may sell to that distributor, and each distributor that seeks to sell electric energy to a retail customer may sell to that customer, only electric energy that has been accepted for sale through a regional power exchange, unless the distributor enters into a contract for that electric energy with that generator or other supplier, subject to the limitations on any such contract contained in any rule or procedure adopted by the independent system operator serving that distributor in accordance with subdivision 5 of subsection B of § 56-580.
D. It shall be the duty and responsibility of each regional power exchange to:
1. Serve as a clearinghouse for supplying electric energy to distributors throughout the Commonwealth or in a specified area thereof, provided all areas of the Commonwealth shall be served by a regional power exchange;
2. Match, through a regular auction process and in coordination with the relevant independent system operator or operators, electric energy offered for sale through the regional power exchange with the demand for electric energy by retail customers of the distributors served by that regional power exchange and determine the market clearing price at which that electric energy is accepted for sale and sold through that regional power exchange;
3. Afford reasonable and nondiscriminatory access to such auction process to all generators, suppliers, and distributors of electric energy, except that in conducting its auction process to meet projected required loads, the regional power exchange shall, before accepting for sale any other electric energy, (i) first accept for sale the electric energy produced by any nuclear energy generator located in the area served by that regional power exchange, as provided in § 56-585 and (ii) next accept for sale all electric energy produced pursuant to a power purchase contract that was entered into prior to January 1, 1998, and that provides that the electric utility that is a party to the contract shall use power produced pursuant to the contract before it uses any electric energy produced by that utility or produced elsewhere;
4. Adopt rules and procedures for fulfilling the duties and responsibilities required by this section, including establishing a managing board on which each incumbent investor-owned electric utility has one representative and other incumbent electric utilities are fairly represented;
5. Adopt minimum standards of training for employees who conduct the business of the regional power exchange and operate and maintain its facilities;
6. Procure all services that are required to fulfill such duties and responsibilities; and
7. Secure any approval from state and federal authorities that may be required to fulfill such duties and responsibilities.
E. No generator, supplier, transmitter or distributor of electric energy shall have an ownership interest in any regional power exchange established under or authorized by this section.
F. To the extent that the costs to an incumbent electric utility or distributor of establishing and operating a regional power exchange are not recovered from their retail customers through regulated rates, those costs shall be recovered through a nonbypassable wires charge to retail customers, as provided in § 56-591.
G. A regional power exchange may:
1. Merge with, join, or cede its authority to a similar entity if one should be established to provide an electric energy auction to serve the loads of retail electric energy customers on a regional, statewide or multi-state basis; and
2. Merge or combine with an independent system operator established under § 56-580.
§ 56-582. Transition plans; Commission approval.
A. Each electric utility authorized to conduct business in the Commonwealth shall submit to the Commission by January 1, 1999, a transition plan relating to the implementation of wholesale competition for the purchase and sale of electric energy. Each transition plan shall include (i) proposals for separating the utility's charges for the supply of electric energy from its other charges beginning January 1, 2001, (ii) the utility's then-current estimate of the regulatory assets associated with its non-nuclear generating facilities, (iii) a proposed cost allocation methodology for determining the nonbypassable wires charges and credits authorized by § 56-591, and (iv) other details of the utility's plan to implement wholesale competition for the purchase and sale of electric energy as provided in this chapter.
B. The Commission may schedule a public hearing for the purpose of examining any transition plan submitted pursuant to this section. Regardless of whether the Commission schedules such a hearing, it shall afford the public an opportunity, over a period not to exceed ninety days, to submit written comments regarding each submitted transition plan.
C. The Commission shall determine whether each transition plan satisfies the requirements of this chapter. A transition plan filed in accordance with this section shall be deemed approved unless approved, disapproved or modified by order of the Commission prior to eighteen months from the date on which it was filed.
§ 56-583. Construction, operation, and closure of, and certificates of public convenience and necessity for, non-nuclear generating facilities; other nonrate aspects of the non-nuclear generation of electric energy; long-range generation planning.
A. Notwithstanding the provisions of §§ 56-265.2 and 56-265.3, beginning January 1, 2001, the Commission no longer shall regulate with regard to an electric utility (i) any decision to construct or close, or the construction or closure of, any non-nuclear generating facility, including requiring a certificate of public convenience and necessity to construct a non-nuclear generating facility, (ii) the operation of any non-nuclear generating facility, (iii) any decision to sell or transfer, or the sale or transfer of, any non-nuclear generating facility to an unregulated affiliate of that electric utility or to another person, and (iv) any other aspect of the non-nuclear generation of electric energy.
B. Notwithstanding the provisions of subsection A of this section, an incumbent electric utility shall provide for sufficient future electric energy capacity, through a dedication of capacity from its own generating facilities or by contract, or by a combination of both, to serve adequately its retail customers from January 1, 2001, through December 31, 2003.
C. Beginning January 1, 2001, the Commission no longer shall regulate the long-range generation planning of an electric utility.
§ 56-584. Transmission and distribution of electric energy.
A. The Commission shall continue to regulate pursuant to this title the distribution of electric energy to retail customers in the Commonwealth and, to the extent not prohibited by federal law, the transmission of electric energy in the Commonwealth. The Commission also shall continue to regulate, to the extent not prohibited by federal law, the siting of facilities for the transmission of electric energy and the reliability, quality, and maintenance by transmitters and distributors of their transmission and retail distribution systems. Persons that own transmission and retail distribution systems may continue to own those systems.
B. Any electric utility authorized to sell electric energy to retail customers in an exclusive service territory in the Commonwealth as of July 1, 1998, and any successor distributor or distributors of such an electric utility, shall be authorized to continue to distribute electric energy to retail customers in that same exclusive service territory.
§ 56-585. Nuclear generating facilities; sale of nuclear generated electric energy through regional power exchange.
A. The Commission shall regulate, pursuant to this title and to the extent not prohibited by federal law, the operational aspects of all nuclear generating facilities under its jurisdiction.
B. After the regional power exchange or exchanges established pursuant to § 56-581 begin operation, each nuclear generating facility in the Commonwealth may make its electric energy available for sale through, and if its electric energy is made available, that electric energy shall be accepted for sale through, the regional power exchange that was established to serve the geographical area in which the nuclear generating facility is located. A regional power exchange shall accept the electric energy offered by the owner or operator of each nuclear generating facility in its geographical area before it accepts electric energy offered by any other generator.
§ 56-586. Regulation of rates subject to the Commission's jurisdiction.
A. By January 1, 1999, each regulated electric utility in the Commonwealth shall submit to the Commission an application for a change in rates, or an alternative rate plan as specified in § 56-235.2, for rates to be in effect through December 31, 2003. If an application for a change in rates or an alternative rate plan was submitted to the Commission by a regulated electric utility prior to January 1, 1998, and is still pending before the Commission on June 30, 1998, that application or alternative rate plan, at the request of the electric utility, either shall be dismissed or shall constitute the application or alternative rate plan required by this subsection and may be amended or supplemented to comply with this chapter. If the electric utility elects to have the pending application or alternative rate plan dismissed, it shall submit a new application or alternative rate plan as required by this section. If the Commission approves a change in rates prior to July 1, 1998, pursuant to an application for a change in rates or an alternative rate plan submitted by a regulated electric utility prior to January 1, 1998, the rates approved pursuant to that application or alternative rate plan, at the request of the electric utility, shall be the rates that remain in effect through December 31, 2003. In the alternative, notwithstanding the provisions of § 56-235.4, the electric utility may elect to submit a new application for a change in rates or new alternative rate plan.
B. Any base rates approved by the Commission for a regulated electric utility on or after July 1, 1998, shall remain in effect until December 31, 2003. Any such rates shall include an authorized return on equity sufficient to permit that utility to recover in full by December 31, 2003, any regulatory assets that are associated with any non-nuclear generating facility owned or operated by that utility. The recovery of fuel costs shall continue through December 31, 2003. Such recovery shall be pursuant to § 56-249.6 until December 31, 2000. The Commission shall determine the appropriate methodology for the recovery of fuel costs for the period January 1, 2001, through December 31, 2003.
C. An electric utility (i) shall be permitted to recover in full all costs associated with nonutility and utility power purchase contracts entered into by that utility before January 1, 1998, and all other investments and commitments that were being recovered in rates that were being charged by that utility prior to January 1, 1997, and (ii) shall be permitted to recover all other investments and commitments in generation assets as determined by the Commission.
D. Effective January 1, 2001, the Commission shall not establish the rates for the generation component of electric energy sold to distributors, or require any person to file a schedule of charges, cost or revenue projections, or any other information for selling electric energy to distributors.
E. Beginning January 1, 2004, the Commission:
1. Shall continue to regulate the rates for the transmission of electric energy, to the extent not prohibited by federal law, and for the distribution of electric energy to retail customers;
2. Shall continue to regulate the revenues an electric utility receives for costs associated with each nuclear generating facility owned or operated by that utility and power purchase contracts entered into by an electric utility, other than a cooperative utility, as of December 31, 2003, as provided in § 56-591; and
3. Shall permit each distributor to recover in full from its retail customers its costs of purchasing electric energy for, and supplying that electric energy to, its retail customers, including any operating expenses associated with that purchase and supply, and such appropriate additional compensation as determined by the Commission.
§ 56-587. Metering and billing.
A. Beginning January 1, 2001, all bills from a distributor to its retail customers shall list separately the charges for (i) the supply of electric energy and (ii) the transmission and distribution of electric energy. Beginning January 1, 2004, all bills also shall list separately the nonbypassable wires charges imposed or credits given under § 56-591.
B. Each distributor shall provide to the independent system operator and the regional power exchange or exchanges serving that distributor all metering data required for the allocation and settlement of electric energy costs among the independent system operator, regional power exchange, and generator or other supplier of electric energy for that distributor.
§ 56-588. Consumer education.
Subject to approval by the Commission, each incumbent electric utility and distributor subject to this chapter shall develop and implement prior to January 1, 2000, and shall continue after that date, a consumer education program informing retail customers of the changes in the regulation of the purchase and sale of electric energy implemented by this chapter. Each distributor shall recover its costs associated with developing, implementing and continuing this consumer education program through a nonbypassable wires charge as provided in § 56-591.
§ 56-589. Public purpose programs.
A. The Commission may, pursuant to the provisions of this title, approve and impose requirements on all generators, suppliers, transmitters and distributors doing business in the Commonwealth to implement any electric energy program that is intended to benefit the public health, safety and welfare, including any program the purpose of which is to:
1. Ensure that each distributor in the Commonwealth provides access to its retail distribution system to each retail customer in its service territory;
2. Promote electric energy efficiency and conservation, protection of the environment, and research and development; or
3. Educate, retrain, provide outplacement services for, or provide early retirement or unemployment benefits to employees of electric utilities whose employment will be directly affected by the implementation of wholesale competition for the purchase and sale of electric energy.
B. The Commission shall determine the cost to each generator, supplier, transmitter and distributor affected by each such program of implementing that program; shall impose a nonbypassable wires charge on all retail customers to pay for those costs as provided in § 56-591, to be collected by all distributors authorized to do business in the Commonwealth; and shall determine how the amounts collected by that nonbypassable wires charge shall be disbursed to each affected generator, supplier, transmitter and distributor.
§ 56-590. Divestiture; certain ownership interests.
A. Nothing in this chapter shall authorize the Commission to order a regulated electric utility, or shall require a nonregulated electric utility, to divest itself of any generation, transmission or distribution assets, and nothing in this chapter shall prohibit any electric utility from divesting itself voluntarily of any such assets.
B. Nothing in this title shall prohibit a generator, transmitter, or distributor of electric energy from (i) being more than one of the foregoing, (ii) owning or being a party to nonutility or utility power purchase contracts entered into by an electric utility, or (iii) owning or operating nuclear generating facilities.
§ 56-591. Authorized nonbypassable wires charges or credits.
A. The nonbypassable wires charges or credits authorized by this section shall be determined by the Commission for those retail customers subject to its jurisdiction and, beginning January 1, 2004, shall be paid by or credited to each distributor's retail customers in the Commonwealth. The Commission shall determine each year the total amount to be paid by, or the total credit to be given to, retail customers subject to its jurisdiction based on the cost allocation methodology last approved by it prior to January 1, 2004, and shall determine a fair and reasonable methodology for allocating any such amount to be paid or credit due among such customers.
B. To the extent that the costs to an incumbent electric utility of establishing and operating an independent system operator and regional power exchange as provided in §§ 56-580 and 56-581, including the cost of money, are not recovered from its retail customers through regulated rates, those costs shall be recovered through a nonbypassable wires charge to be paid by the retail customers located in the geographic area that was the service territory of that incumbent electric utility. The establishment costs shall be recovered over the period of the useful life of the equipment and other assets required to establish the independent system operator and regional power exchange.
C. To the extent that the costs to a distributor of establishing and operating an independent system operator and a regional power exchange as provided in §§ 56-580 and 56-581, including the cost of money, are not recovered from its retail customers through regulated rates, those costs shall be recovered through a nonbypassable wires charge to be paid by the retail customers of that distributor in the Commonwealth. The establishment costs shall be recovered over the period of the useful life of the equipment and other assets required to establish the regional power exchange.
D. The annual nonbypassable wires charges or credits related to nonutility and utility power purchase contracts entered into, and to each nuclear generating facility owned by, an electric utility, other than a cooperative electric utility, shall be calculated each year so that the charge is recovered or the credit is refunded, as appropriate, by that electric utility over the life of those contracts or the period that each facility is licensed by the Nuclear Regulatory Commission, respectively, as follows:
1. The Commission shall estimate annually the revenues expected to be received that year from the sale of electric energy purchased pursuant to that electric utility's power purchase contracts, or produced by that nuclear generating facility. In accordance with the regulated ratemaking methodology last approved by the Commission for the electric utility that is or was the party to that contract, or is the owner of that facility, the Commission also shall estimate the annual revenues that must be received that year to ensure recovery of the costs related to those contracts or to the production of electric energy by that facility, including (i) the electric utility's investments and commitments in generation assets related to those contracts or to that facility, (ii) all administrative costs related to those contracts and operation and maintenance costs related to that facility, and (iii) for a nuclear generating facility, the cost of fuel and the opportunity to earn a fair and reasonable rate of return. The calculation of such investments and commitments shall be consistent with subsection C of § 56-586.
2. If the Commission estimates that the amount to be received from the sale of electric energy will be less than the amount it estimates must be received to recover costs, the Commission shall order that the difference be allocated to and paid by retail customers located in the geographic area that was the service territory of the incumbent electric utility.
3. If the Commission estimates that the amount to be received from the sale of electric energy will be more than the amount it estimates must be received to recover costs, the Commission shall order that a credit in the amount of the difference be allocated and given to the retail customers specified in subdivision 2 of this subsection.
4. The Commission shall determine on an annual basis whether the amount it estimated would be received from the sale of electric energy and the amount it estimated would be needed to recover costs were more or less than the amount that in fact was received from the sale of electric energy and the amount actually needed to recover costs, and shall adjust the nonbypassable wires charge or credit ordered pursuant to subdivision 2 or 3 of this subsection for the next year accordingly. In determining the amount the electric utility actually needed to receive to recover its costs related to its power purchase contracts, the Commission shall determine the amount, if any, by which those costs were reduced because of the utility's efforts to mitigate those costs, and if there was such a reduction, shall calculate any adjustment required by this subdivision so that any such reduction is shared equally by (i) the retail customers located in the geographic area that was the service territory of the incumbent electric utility and (ii) the shareholders or members of that utility.
E. The nonbypassable wires charge related to the consumer education program specified in § 56-588 shall be calculated so that those costs are recovered from retail customers located in the geographic area that was the service territory of the incumbent electric utility or the retail customers of each distributor in the Commonwealth over the duration of the program or until those costs are recovered in full.
F. The Commission shall determine the appropriate nonbypassable wires charge to be paid by retail customers located in the geographic area that was the service territory of the incumbent electric utility or the retail customers of each distributor for:
1. The cost of any public purpose program specified in § 56-589, to be recovered over the duration of that program; and
2. Any other cost associated with the implementation of wholesale competition for the purchase and sale of electric energy, as provided in § 56-579, that the Commission determines is both necessary and reasonable for retail customers to pay, to be recovered over a period to be determined by the Commission not to exceed twenty years.
G. The nonbypassable wires charges authorized by this section shall be collected by the distributor serving each affected retail customer and remitted by that distributor to the electric utility, generator, transmitter, distributor, or supplier on behalf of which the charge is collected. The credits authorized by this section shall be processed by the distributor and, where appropriate, shall be charged to the electric utility, generator, transmitter, distributor, or supplier on behalf of which the credit was processed. The distributor may charge the electric utility, generator, transmitter, distributor, or supplier a reasonable administrative fee, as determined by the Commission, for the collection and remittance of such charges or the processing of such credits.
2. That it is the intention of the General Assembly to provide users of electric energy in the Commonwealth the benefits of a competitive electric energy market by requiring that all generators and suppliers of electric energy doing business in the Commonwealth shall be taxed at the same rate, yet also to ensure that the Commonwealth and its localities do not experience a decrease in their consumer utility tax revenues because of the implementation of competition in the purchase and sale of electric energy pursuant to this Act. To this end, the Senate Committee on Finance, the House of Delegates Committee on Finance, and the Virginia Department of Taxation shall jointly undertake a study of the necessity and means of amending the Commonwealth's laws governing state and local taxation to implement this intention and shall submit a report and recommendations to the 1999 Session of the General Assembly by no later than November 15, 1998.
3. That it is the intention of the General Assembly that consideration be given to implementing competition in the electric energy market at the retail level. Accordingly, the State Corporation Commission is requested to study the effect of this Act and report to the Governor and the 1999 Session of the General Assembly, as provided in the procedures of the Division of Legislative Automated Systems for processing legislative documents, concerning the desirability and feasibility of providing, and, if appropriate, a time schedule for providing, retail customers with the opportunity to choose their supplier of electric energy.