Relating to methods for the recovery of system restoration costs incurred by electric utilities following hurricanes, tropical storms, ice or snow storms, floods, and other weather-related events and natural disasters.
The bill allows electric utilities to create, fund, and replenish self-insurance reserves and recover related costs via securitization. This means that the utilities can use financial instruments to manage the costs associated with system restoration more efficiently than traditional financing methods. By utilizing transition bonds, which are aimed at lowering carrying costs, it is anticipated that this approach could ultimately result in benefits for ratepayers when compared with other financing options.
SB769 focuses on the recovery methods for system restoration costs incurred by electric utilities following weather-related disasters. The bill introduces a new subchapter in the Utilities Code, which outlines the procedures and mechanisms through which electric utilities can recover costs related to restoring service and infrastructure after events such as hurricanes, floods, and snowstorms. It aims to ensure that utilities can obtain timely recovery of these expenses, thereby maintaining service reliability and reducing financial burdens on the utilities.
Notably, the legislation includes provisions that address the review process for commission orders related to these recoveries, with appeals only permitted in district court. This could be seen as a limitation on checks and balances regarding utility cost recoveries. Furthermore, the bill also discusses the implications of any insurance proceeds or governmental grants received by utilities, which must be used to offset recovery from customers. Critics might argue that while the bill aims to streamline recovery for utilities, it could potentially lead to increased costs for consumers if not carefully regulated.