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Illinois Senate Bill SB1538

Illinois 2023-2024 Regular Session

Illinois Senate Bill SB1538 Compare Versions

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11 103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB1538 Introduced 2/8/2023, by Sen. Cristina Castro SYNOPSIS AS INTRODUCED: 220 ILCS 5/9-220.3 Amends the Public Utilities Act. Changes the repeal date for provisions authorizing natural gas surcharges to provide for recovery of costs associated with investments in qualifying infrastructure plants from December 31, 2023 to July 1, 2023. Effective immediately. LRB103 05801 AMQ 50821 b A BILL FOR 103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB1538 Introduced 2/8/2023, by Sen. Cristina Castro SYNOPSIS AS INTRODUCED: 220 ILCS 5/9-220.3 220 ILCS 5/9-220.3 Amends the Public Utilities Act. Changes the repeal date for provisions authorizing natural gas surcharges to provide for recovery of costs associated with investments in qualifying infrastructure plants from December 31, 2023 to July 1, 2023. Effective immediately. LRB103 05801 AMQ 50821 b LRB103 05801 AMQ 50821 b A BILL FOR
22 103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB1538 Introduced 2/8/2023, by Sen. Cristina Castro SYNOPSIS AS INTRODUCED:
33 220 ILCS 5/9-220.3 220 ILCS 5/9-220.3
44 220 ILCS 5/9-220.3
55 Amends the Public Utilities Act. Changes the repeal date for provisions authorizing natural gas surcharges to provide for recovery of costs associated with investments in qualifying infrastructure plants from December 31, 2023 to July 1, 2023. Effective immediately.
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1111 1 AN ACT concerning utilities.
1212 2 Be it enacted by the People of the State of Illinois,
1313 3 represented in the General Assembly:
1414 4 Section 5. The Public Utilities Act is amended by changing
1515 5 Section 9-220.3 as follows:
1616 6 (220 ILCS 5/9-220.3)
1717 7 (Section scheduled to be repealed on December 31, 2023)
1818 8 Sec. 9-220.3. Natural gas surcharges authorized.
1919 9 (a) Tariff.
2020 10 (1) Pursuant to Section 9-201 of this Act, a natural
2121 11 gas utility serving more than 700,000 customers may file a
2222 12 tariff for a surcharge which adjusts rates and charges to
2323 13 provide for recovery of costs associated with investments
2424 14 in qualifying infrastructure plant, independent of any
2525 15 other matters related to the utility's revenue
2626 16 requirement.
2727 17 (2) Within 30 days after the effective date of this
2828 18 amendatory Act of the 98th General Assembly, the
2929 19 Commission shall adopt emergency rules to implement the
3030 20 provisions of this amendatory Act of the 98th General
3131 21 Assembly. The utility may file with the Commission tariffs
3232 22 implementing the provisions of this amendatory Act of the
3333 23 98th General Assembly after the effective date of the
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3737 103RD GENERAL ASSEMBLY State of Illinois 2023 and 2024 SB1538 Introduced 2/8/2023, by Sen. Cristina Castro SYNOPSIS AS INTRODUCED:
3838 220 ILCS 5/9-220.3 220 ILCS 5/9-220.3
3939 220 ILCS 5/9-220.3
4040 Amends the Public Utilities Act. Changes the repeal date for provisions authorizing natural gas surcharges to provide for recovery of costs associated with investments in qualifying infrastructure plants from December 31, 2023 to July 1, 2023. Effective immediately.
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6868 1 emergency rules authorized by subsection (i).
6969 2 (3) The Commission shall issue an order approving, or
7070 3 approving with modification to ensure compliance with this
7171 4 Section, the tariff no later than 120 days after such
7272 5 filing of the tariffs filed pursuant to this Section. The
7373 6 utility shall have 7 days following the date of service of
7474 7 the order to notify the Commission in writing whether it
7575 8 will accept any modifications so identified in the order
7676 9 or whether it has elected not to proceed with the tariff.
7777 10 If the order includes no modifications or if the utility
7878 11 notifies the Commission that it will accept such
7979 12 modifications, the tariff shall take effect on the first
8080 13 day of the calendar year in which the Commission issues
8181 14 the order, subject to petitions for rehearing and
8282 15 appellate procedures. After the tariff takes effect, the
8383 16 utility may, upon 10 days' notice to the Commission, file
8484 17 to withdraw the tariff at any time, and the Commission
8585 18 shall approve such filing without suspension or hearing,
8686 19 subject to a final reconciliation as provided in
8787 20 subsection (e) of this Section.
8888 21 (4) When a natural gas utility withdraws the surcharge
8989 22 tariff, the utility shall not recover any additional
9090 23 charges through the surcharge approved pursuant to this
9191 24 Section, subject to the resolution of the final
9292 25 reconciliation pursuant to subsection (e) of this Section.
9393 26 The utility's qualifying infrastructure investment net of
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104104 1 accumulated depreciation may be transferred to the natural
105105 2 gas utility's rate base in the utility's next general rate
106106 3 case. The utility's delivery base rates in effect upon
107107 4 withdrawal of the surcharge tariff shall not be adjusted
108108 5 at the time the surcharge tariff is withdrawn.
109109 6 (5) A natural gas utility that is subject to its
110110 7 delivery base rates being fixed at their current rates
111111 8 pursuant to a Commission order entered in Docket No.
112112 9 11-0046, notwithstanding the effective date of its tariff
113113 10 authorized pursuant to this Section, shall reflect in a
114114 11 tariff surcharge only those projects placed in service
115115 12 after the fixed rate period of the merger agreement has
116116 13 expired by its terms.
117117 14 (b) For purposes of this Section, "qualifying
118118 15 infrastructure plant" includes only plant additions placed in
119119 16 service not reflected in the rate base used to establish the
120120 17 utility's delivery base rates. "Costs associated with
121121 18 investments in qualifying infrastructure plant" shall include
122122 19 a return on qualifying infrastructure plant and recovery of
123123 20 depreciation and amortization expense on qualifying
124124 21 infrastructure plant, net of the depreciation included in the
125125 22 utility's base rates on any plant retired in conjunction with
126126 23 the installation of the qualifying infrastructure plant.
127127 24 Collectively the "qualifying infrastructure plant" and "costs
128128 25 associated with investments in qualifying infrastructure
129129 26 plant" are referred to as the "qualifying infrastructure
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140140 1 investment" and that are related to one or more of the
141141 2 following:
142142 3 (1) the installation of facilities to retire and
143143 4 replace underground natural gas facilities, including
144144 5 facilities appurtenant to facilities constructed of those
145145 6 materials such as meters, regulators, and services, and
146146 7 that are constructed of cast iron, wrought iron, ductile
147147 8 iron, unprotected coated steel, unprotected bare steel,
148148 9 mechanically coupled steel, copper, Cellulose Acetate
149149 10 Butyrate (CAB) plastic, pre-1973 DuPont Aldyl "A"
150150 11 polyethylene, PVC, or other types of materials identified
151151 12 by a State or federal governmental agency as being prone
152152 13 to leakage;
153153 14 (2) the relocation of meters from inside customers'
154154 15 facilities to outside;
155155 16 (3) the upgrading of the gas distribution system from
156156 17 a low pressure to a medium pressure system, including
157157 18 installation of high-pressure facilities to support the
158158 19 upgrade;
159159 20 (4) modernization investments by a combination
160160 21 utility, as defined in subsection (b) of Section 16-108.5
161161 22 of this Act, to install:
162162 23 (A) advanced gas meters in connection with the
163163 24 installation of advanced electric meters pursuant to
164164 25 Sections 16-108.5 and 16-108.6 of this Act; and
165165 26 (B) the communications hardware and software and
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176176 1 associated system software that creates a network
177177 2 between advanced gas meters and utility business
178178 3 systems and allows the collection and distribution of
179179 4 gas-related information to customers and other parties
180180 5 in addition to providing information to the utility
181181 6 itself;
182182 7 (5) replacing high-pressure transmission pipelines and
183183 8 associated facilities identified as having a higher risk
184184 9 of leakage or failure or installing or replacing
185185 10 high-pressure transmission pipelines and associated
186186 11 facilities to establish records and maximum allowable
187187 12 operating pressures;
188188 13 (6) replacing difficult to locate mains and service
189189 14 pipes and associated facilities; and
190190 15 (7) replacing or installing transmission and
191191 16 distribution regulator stations, regulators, valves, and
192192 17 associated facilities to establish over-pressure
193193 18 protection.
194194 19 With respect to the installation of the facilities
195195 20 identified in paragraph (1) of subsection (b) of this Section,
196196 21 the natural gas utility shall determine priorities for such
197197 22 installation with consideration of projects either: (i)
198198 23 integral to a general government public facilities improvement
199199 24 program or (ii) ranked in the highest risk categories in the
200200 25 utility's most recent Distribution Integrity Management Plan
201201 26 where removal or replacement is the remedial measure.
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212212 1 (c) Qualifying infrastructure investment, defined in
213213 2 subsection (b) of this Section, recoverable through a tariff
214214 3 authorized by subsection (a) of this Section, shall not
215215 4 include costs or expenses incurred in the ordinary course of
216216 5 business for the ongoing or routine operations of the utility,
217217 6 including, but not limited to:
218218 7 (1) operating and maintenance costs; and
219219 8 (2) costs of facilities that are revenue-producing,
220220 9 which means facilities that are constructed or installed
221221 10 for the purpose of serving new customers.
222222 11 (d) Gas utility commitments. A natural gas utility that
223223 12 has in effect a natural gas surcharge tariff pursuant to this
224224 13 Section shall:
225225 14 (1) recognize that the General Assembly identifies
226226 15 improved public safety and reliability of natural gas
227227 16 facilities as the cornerstone upon which this Section is
228228 17 designed, and qualifying projects should be encouraged,
229229 18 selected, and prioritized based on these factors; and
230230 19 (2) provide information to the Commission as requested
231231 20 to demonstrate that (i) the projects included in the
232232 21 tariff are indeed qualifying projects and (ii) the
233233 22 projects are selected and prioritized taking into account
234234 23 improved public safety and reliability.
235235 24 (3) The amount of qualifying infrastructure investment
236236 25 eligible for recovery under the tariff in the applicable
237237 26 calendar year is limited to the lesser of (i) the actual
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248248 1 qualifying infrastructure plant placed in service in the
249249 2 applicable calendar year and (ii) the difference by which
250250 3 total plant additions in the applicable calendar year
251251 4 exceed the baseline amount, and subject to the limitation
252252 5 in subsection (g) of this Section. A natural gas utility
253253 6 can recover the costs of qualifying infrastructure
254254 7 investments through an approved surcharge tariff from the
255255 8 beginning of each calendar year subject to the
256256 9 reconciliation initiated under paragraph (2) of subsection
257257 10 (e) of this Section, during which the Commission may make
258258 11 adjustments to ensure that the limits defined in this
259259 12 paragraph are not exceeded. Further, if total plant
260260 13 additions in a calendar year do not exceed the baseline
261261 14 amount in the applicable calendar year, the Commission,
262262 15 during the reconciliation initiated under paragraph (2) of
263263 16 subsection (e) of this Section for the applicable calendar
264264 17 year, shall adjust the amount of qualifying infrastructure
265265 18 investment eligible for recovery under the tariff to zero.
266266 19 (4) For purposes of this Section, "baseline amount"
267267 20 means an amount equal to the utility's average of total
268268 21 depreciation expense, as reported on page 336, column (b)
269269 22 of the utility's ILCC Form 21, for the calendar years 2006
270270 23 through 2010.
271271 24 (e) Review of investment.
272272 25 (1) The amount of qualifying infrastructure investment
273273 26 shall be shown on an Information Sheet supplemental to the
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284284 1 surcharge tariff and filed with the Commission monthly or
285285 2 some other time period at the option of the utility. The
286286 3 Information Sheet shall be accompanied by data showing the
287287 4 calculation of the qualifying infrastructure investment
288288 5 adjustment. Unless otherwise ordered by the Commission,
289289 6 each qualifying infrastructure investment adjustment shown
290290 7 on an Information Sheet shall become effective pursuant to
291291 8 the utility's approved tariffs.
292292 9 (2) For each calendar year in which a surcharge tariff
293293 10 is in effect, the natural gas utility shall file a
294294 11 petition with the Commission to initiate hearings to
295295 12 reconcile amounts billed under each surcharge authorized
296296 13 pursuant to this Section with the actual prudently
297297 14 incurred costs recoverable under this tariff in the
298298 15 preceding year. The petition filed by the natural gas
299299 16 utility shall include testimony and schedules that support
300300 17 the accuracy and the prudence of the qualifying
301301 18 infrastructure investment for the calendar year being
302302 19 reconciled. The petition filed shall also include the
303303 20 number of jobs attributable to the natural gas surcharge
304304 21 tariff as required by rule. The review of the utility's
305305 22 investment shall include identification and review of all
306306 23 plant that was ranked within the highest risk categories
307307 24 in that utility's most recent Distribution Integrity
308308 25 Management Plan.
309309 26 (f) The rate of return applied shall be the overall rate of
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320320 1 return authorized by the Commission in the utility's last gas
321321 2 rate case.
322322 3 (g) The cumulative amount of increases billed under the
323323 4 surcharge, since the utility's most recent delivery service
324324 5 rate order, shall not exceed an annual average 4% of the
325325 6 utility's delivery base rate revenues, but shall not exceed
326326 7 5.5% in any given year. On the effective date of new delivery
327327 8 base rates, the surcharge shall be reduced to zero with
328328 9 respect to qualifying infrastructure investment that is
329329 10 transferred to the rate base used to establish the utility's
330330 11 delivery base rates, provided that the utility may continue to
331331 12 charge or refund any reconciliation adjustment determined
332332 13 pursuant to subsection (e) of this Section.
333333 14 (h) If a gas utility obtains a surcharge tariff under this
334334 15 Section 9-220.3, then it and its affiliates are excused from
335335 16 the rate case filing requirements contained in Sections
336336 17 9-220(h) and 9-220(h-1). In the event a natural gas utility,
337337 18 prior to the effective date of this amendatory Act of the 98th
338338 19 General Assembly, made a rate case filing that is still
339339 20 pending on the effective date of this amendatory Act of the
340340 21 98th General Assembly, the natural gas utility may, at the
341341 22 time it files its surcharge tariff with the Commission, also
342342 23 file a notice with the Commission to withdraw its rate case
343343 24 filing. Any affiliate of such natural gas utility may also
344344 25 file to withdraw its rate case filing. Upon receipt of such
345345 26 notice, the Commission shall dismiss the rate case filing with
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356356 1 prejudice and such tariffs and the record related thereto
357357 2 shall not be the subject of any further hearing,
358358 3 investigation, or proceeding of any kind related to rates for
359359 4 gas delivery services. Notwithstanding the foregoing, a
360360 5 natural gas utility shall not be permitted to withdraw a rate
361361 6 case filing for which a proposed order recommending a rate
362362 7 reduction is pending. A natural gas utility shall not be
363363 8 permitted to withdraw the gas delivery services tariffs that
364364 9 are the subject of Commission Docket Nos. 12-0511/12-0512
365365 10 (cons.). None of the costs incurred for the withdrawn rate
366366 11 case are recoverable from ratepayers.
367367 12 (i) The Commission shall promulgate rules and regulations
368368 13 to carry out the provisions of this Section under the
369369 14 emergency rulemaking provisions set forth in Section 5-45 of
370370 15 the Illinois Administrative Procedure Act, and such emergency
371371 16 rules shall be effective no later than 30 days after the
372372 17 effective date of this amendatory Act of the 98th General
373373 18 Assembly.
374374 19 (j) This Section is repealed July 1, 2023 December 31,
375375 20 2023.
376376 21 (Source: P.A. 98-57, eff. 7-5-13.)
377377 22 Section 99. Effective date. This Act takes effect upon
378378 23 becoming law.
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