Connecticut 2022 Regular Session

Connecticut House Bill HB05203 Compare Versions

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Version 2 (New)

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7		-	General Assembly Substitute Bill No. 5203
	4	+	LCO No. 1489 1 of 5
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	6	+	General Assembly Raised Bill No. 5203
8	7		February Session, 2022
	8	+	LCO No. 1489
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	10	+
	11	+	Referred to Committee on ENERGY AND TECHNOLOGY
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	13	+
	14	+	Introduced by:
	15	+	(ET)
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14		-	AN ACT CONCERNING THE PUBLIC UTILITIES REGULATORY
15		-	AUTHORITY'S POWERS, UTILITY ADVERTISING DISCLOSURES,
16		-	AND ELECTRIC BILL COMPONENTS.
	20	+	AN ACT CONCERNING UTILITY COMPANY COST -SHARING
	21	+	MECHANISMS.
17	22		Be it enacted by the Senate and House of Representatives in General
18	23		Assembly convened:
19	24
20	25		Section 1. Subsection (b) of section 16-19tt of the general statutes is 1
21	26		repealed and the following is substituted in lieu thereof (Effective October 2
22	27		1, 2022): 3
23	28		(b) [In any rate case initiated on or after July 8, 2013, or in a pending 4
24	29		rate case for which a final decision has not been issued prior to July 8, 5
25	30		2013, the Public Utilities Regulatory Authority shall order the state's gas 6
26	31		and electric distribution companies to decouple distribution revenues 7
27	32		from the volume of natural gas and electricity sales. For electric 8
28	33		distribution companies, the decoupling mechanism shall be the 9
29	34		adjustment of actual distribution revenues to allowed distribution 10
30	35		revenues. For gas distribution companies, the decoupling mechanism 11
31	36		shall be a mechanism that does not remove the incentive to support the 12
32	37		expansion of natural gas use pursuant to the 2013 Comprehensive 13
33	38		Energy Strategy, such as a mechanism that decouples distribution 14
34		-	revenue based on a use-per-customer basis. In making its determination 15
35		-	on this matter, the authority shall consider the impact of decoupling on 16
36		-	the gas or electric distribution company's return on equity and make any 17 Substitute Bill No. 5203
	39	+	revenue based on a use-per-customer basis. In making its determination 15 Raised Bill No. 5203
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	45	+	on this matter, the authority shall consider the impact of decoupling on 16
	46	+	the gas or electric distribution company's return on equity and make any 17
43	47		necessary adjustments thereto.] In any rate case initiated on or after 18
44	48		October 1, 2022, or in a pending rate case for which a final decision has 19
45	49		not been issued prior to October 1, 2022, the Public Utilities Regulatory 20
46	50		Authority may order the state's gas and electric distribution companies 21
47	51		to decouple distribution revenues from the volume of natural gas and 22
48	52		electricity sales. The authority shall have the discretion to determine the 23
49	53		decoupling mechanism and methodology used in decoupling orders 24
50	54		made pursuant to this subsection. 25
51		-	Sec. 2. Section 16-~~19jj~~ of the ~~general statutes is repealed and~~ the 26
52		-	following is substituted in lieu ~~thereof (Effective October 1, 2022):~~ 27
53		-	~~The Public Utilities Regulatory Authority shall~~, ~~whenever it deems~~ 28
54		-	~~appropriate, [encourage] permit~~ the ~~use of proposed settlements~~ 29
55		-	~~produced by alternative dispute resolution mechanisms to resolve~~ 30
56		-	~~contested cases and proceedings.~~ ~~In order to approve~~ a ~~settlement of a~~ 31
57		-	~~proceeding to amend rates under~~ section ~~16-19,~~ the ~~authority shall~~ 32
58		-	~~determine that~~ the ~~resulting rates and other terms of such settlement~~ 33
59		-	~~conform to~~ the ~~principles and guidelines set forth in section 16-19e. The~~ 34
60		-	~~term~~ of ~~any provision in~~ a ~~settlement of a proceeding to amend rates~~ 35
61		-	~~under section 16-19~~ ~~shall not extend more than three years from its~~ 36
62		-	~~approval by the authority.~~ Any ~~settlement of a proceeding to amend~~ 37
63		-	~~rates under section 16-19~~ ~~subsequent to an approved settlement of~~ a 38
64		-	~~proceeding to amend rates shall not constitute a general~~ rate ~~hearing for~~ 39
65		-	~~purposes of section 16-19a.~~ 40
66		-	~~Sec. 3. Section 16-19bb~~ of ~~the general statutes is repealed~~ and ~~the~~ 41
67		-	~~following is substituted in lieu thereof (Effective October 1~~, ~~2022):~~ 42
68		-	The ~~Public Utilities Regulatory Authority shall require that any funds~~ 43
69		-	~~held~~ by an ~~electric distribution company~~ in ~~excess of~~ the ~~company's~~ 44
70		-	~~authorized return on equity, which funds are intended by~~ the ~~authority~~ 45
71		-	to ~~offset future rate increases in lieu~~ of a ~~present rate decrease, shall be~~ 46
72		-	~~applied to such rate increases~~ or ~~shall be refunded to the company's~~ 47
73		-	customers~~, [within~~ ~~one year~~ of ~~receipt] in a manner determined by the~~ 48
74		-	~~authority~~, ~~not later than~~ the ~~conclusion of the company's next~~ 49 ~~Substitute~~ Bill No. 5203
	55	+	Sec. 2. Subsection (g) of section 16-19 of the 2022 supplement to the 26
	56	+	general statutes is repealed and the following is substituted in lieu 27
	57	+	thereof (Effective October 1, 2022): 28
	58	+	(g) The authority shall hold either a special public hearing or combine 29
	59	+	an investigation with an ongoing four-year review conducted in 30
	60	+	accordance with section 16-19a or with a general rate hearing conducted 31
	61	+	in accordance with subsection (a) of this section on the need for an 32
	62	+	interim rate decrease (1) when a public service company has, for [the 33
	63	+	rolling twelve-month period ending with the two most recent 34
	64	+	consecutive financial] two of the previous four quarters, earned a return 35
	65	+	on equity which exceeds the return authorized by the authority by at 36
	66	+	least [one] one-half percentage point, (2) if it finds that any change in 37
	67	+	municipal, state or federal tax law creates a significant increase in a 38
	68	+	company's rate of return, or (3) if it [finds] provides appropriate notice 39
	69	+	that a public service company may be collecting rates or may have an 40
	70	+	authorized rate of return which are more than just, reasonable and 41
	71	+	adequate, as determined by the authority, provided the authority shall 42
	72	+	require appropriate notice of hearing to the company and its customers 43
	73	+	who would be affected by an interim rate decrease in such form as the 44
	74	+	authority deems reasonable. The company shall be required to 45
	75	+	demonstrate to the satisfaction of the authority that earning such a 46
	76	+	return on equity or collecting rates which are more than just, reasonable 47
	77	+	and adequate is directly beneficial to its customers. At the completion of 48
	78	+	the proceeding, the authority may order an interim rate decrease if it 49 Raised Bill No. 5203
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81		-	proceeding conducted pursuant to section 16-19a. 50
82		-	Sec. 4. Subsection (c) of section 16-19d of the general statutes is 51
83		-	repealed and the following is substituted in lieu thereof (Effective October 52
84		-	1, 2022): 53
85		-	(c) [A public service company shall make application to the authority 54
86		-	for determination that equipment meets the requirements of 55
87		-	subdivision (4) of subsection (b) of this section. The authority shall, to 56
88		-	the extent practicable, make such determination within one hundred 57
89		-	twenty days of such filing. All reasonable and proper expenses, required 58
90		-	by the authority and the Office of Consumer Counsel, including, but not 59
91		-	limited to, the costs associated with analysis, testing, evaluation and 60
92		-	testimony at a public hearing or other proceeding, shall be borne by the 61
93		-	company and shall be paid by the company at such times and in such 62
94		-	manner as the authority directs.] On or before February first each year, 63
95		-	any gas company or electric distribution company that recovered 64
96		-	advertising costs against ratepayers during the previous year shall file a 65
97		-	public disclosure report with the authority. For each advertisement, the 66
98		-	report shall delineate the dollar amount, source of funding, primary 67
99		-	purpose of the advertisement, communications medium or platform 68
100		-	and approximate dates during which the advertisement was displayed 69
101		-	or transmitted to the public, broken down by type of advertising, by 70
102		-	month and by year, and by advertising campaign. Failure to provide 71
103		-	complete and accurate data in the report shall constitute a violation for 72
104		-	which the authority may levy civil penalties against such company 73
105		-	pursuant to section 16-41. 74
106		-	Sec. 5. (Effective July 1, 2022) The chairperson of the Public Utilities 75
107		-	Regulatory Authority shall prepare a report that outlines and analyzes 76
108		-	the public policy components of the delivery side of the electric bill for 77
109		-	customers of each electric distribution company. The chairperson shall 78
110		-	submit such report, in accordance with the provisions of section 11-4a 79
111		-	of the general statutes, to the joint standing committee of the General 80
112		-	Assembly having cognizance of matters related to energy on or before 81
113		-	January 15, 2023. 82 Substitute Bill No. 5203
	82	+	LCO No. 1489 3 of 5
	83	+
	84	+	finds that such return on equity or rates exceeds a reasonable rate of 50
	85	+	return or is more than just, reasonable and adequate as determined by 51
	86	+	the authority. Any such interim rate decrease shall be subject to a 52
	87	+	customer surcharge if the interim rates collected by the company are less 53
	88	+	than the rates finally approved by the authority or fixed at the 54
	89	+	conclusion of any appeal taken as a result of any finding by the 55
	90	+	authority. Such surcharge shall be assessed against customers in such 56
	91	+	amounts and by such procedure as ordered by the authority. If the 57
	92	+	authority elects to pursue an earnings sharing mechanism to address a 58
	93	+	company's over earnings, such mechanism shall direct not less than 59
	94	+	eighty per cent of the over earnings to the company's ratepayers. 60
	95	+	Sec. 3. Section 16-19bb of the general statutes is repealed and the 61
	96	+	following is substituted in lieu thereof (Effective October 1, 2022): 62
	97	+	The Public Utilities Regulatory Authority shall require that any funds 63
	98	+	held by an electric distribution company in excess of the company's 64
	99	+	authorized return on equity, which funds are intended by the authority 65
	100	+	to offset future rate increases in lieu of a present rate decrease, shall be 66
	101	+	applied to such rate increases or shall be refunded to the company's 67
	102	+	customers, [within one year of receipt] in a manner determined by the 68
	103	+	authority in its sole discretion, not later than the conclusion of the 69
	104	+	company's next proceeding conducted pursuant to section 16-19a. 70
	105	+	Sec. 4. Subsection (c) of section 16-19d of the general statutes is 71
	106	+	repealed and the following is substituted in lieu thereof (Effective October 72
	107	+	1, 2022): 73
	108	+	(c) [A public service company shall make application to the authority 74
	109	+	for determination that equipment meets the requirements of 75
	110	+	subdivision (4) of subsection (b) of this section. The authority shall, to 76
	111	+	the extent practicable, make such determination within one hundred 77
	112	+	twenty days of such filing. All reasonable and proper expenses, required 78
	113	+	by the authority and the Office of Consumer Counsel, including, but not 79
	114	+	limited to, the costs associated with analysis, testing, evaluation and 80
	115	+	testimony at a public hearing or other proceeding, shall be borne by the 81 Raised Bill No. 5203
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	121	+	company and shall be paid by the company at such times and in such 82
	122	+	manner as the authority directs.] On or before February first each year, 83
	123	+	any gas company or electric distribution company that recovered 84
	124	+	advertising costs against ratepayers during the previous year shall file a 85
	125	+	public disclosure report with the authority. For each advertisement, the 86
	126	+	report shall delineate the dollar amount, source of funding, primary 87
	127	+	purpose of the advertisement, communications medium or platform 88
	128	+	and approximate dates during which the advertisement was displayed 89
	129	+	or transmitted to the public, broken down by type of advertising, by 90
	130	+	month and by year, and by advertising campaign. Failure to provide 91
	131	+	complete and accurate data in the report shall constitute a violation for 92
	132	+	which the authority may levy civil penalties against such company 93
	133	+	pursuant to section 16-41. 94
	134	+	Sec. 5. Subsection (a) of section 16-19gg of the general statutes is 95
	135	+	repealed and the following is substituted in lieu thereof (Effective October 96
	136	+	1, 2022): 97
	137	+	(a) During each proceeding on a rate amendment under section 16-98
	138	+	19, as amended by this act, proposed by an electric or gas public service 99
	139	+	company, as defined in section 16-1, the Public Utilities Regulatory 100
	140	+	Authority, when determining rates for individual rate classes, shall give 101
	141	+	consideration to the energy cost of manufacturers by analyzing the 102
	142	+	following: (1) The effect of different rates of return among rate classes 103
	143	+	upon manufacturers; (2) the use of different cost allocation 104
	144	+	methodologies; (3) the use of flexible pricing; (4) macroeconomic 105
	145	+	conditions; and [(4)] (5) any other issue deemed relevant by the 106
	146	+	authority. 107
	147	+	Sec. 6. (NEW) (Effective October 1, 2022) On and after January 1, 2023, 108
	148	+	new capital expenditures shall not be eligible for cost recovery through 109
	149	+	an on-bill reconciling mechanism first authorized in 2018. 110
	150	+	Sec. 7. (NEW) (Effective October 1, 2022) No public service company 111
	151	+	shall recover through rates any cost associated with membership, dues 112
	152	+	or contributions to a business or industry trade association, group or 113 Raised Bill No. 5203
	153	+
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	156	+	LCO No. 1489 5 of 5
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	158	+	related entity incorporated under Section 501 of the Internal Revenue 114
	159	+	Code of 1986, or any subsequent corresponding internal revenue code 115
	160	+	of the United States, as amended from time to time. 116
120	161		This act shall take effect as follows and shall amend the following
121	162		sections:
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123	164		Section 1 October 1, 2022 16-19tt(b)
124		-	Sec. 2 October 1, 2022 16-~~19jj~~
	165	+	Sec. 2 October 1, 2022 16-19(g)
125	166		Sec. 3 October 1, 2022 16-19bb
126	167		Sec. 4 October 1, 2022 16-19d(c)
127		-	Sec. 5 July 1, 2022 New section
	168	+	Sec. 5 October 1, 2022 16-19gg(a)
	169	+	Sec. 6 October 1, 2022 New section
	170	+	Sec. 7 October 1, 2022 New section
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129		-	Statement of Legislative Commissioners:
130		-	The title was changed for accuracy.
131		-
132		-	ET Joint Favorable Subst.
	172	+	Statement of Purpose:
	173	+	To give the Public Utilities Regulatory Authority greater discretion to
	174	+	design utility revenue decoupling mechanisms or formulas, to require
	175	+	the authority to adopt cost-sharing mechanisms for excess earnings that
	176	+	direct most of these earnings to ratepayers, and to make other changes
	177	+	affecting electric utility companies.
	178	+	[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except
	179	+	that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not
	180	+	underlined.]
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