Rhode Island 2023 Regular Session

Rhode Island Senate Bill S0704 Compare Versions

Only one version of the bill is available at this time.

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5	5	2023 -- S 0704
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7	7	LC002401
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9	9	S TATE OF RHODE IS LAND
10	10	IN GENERAL ASSEMBLY
11	11	JANUARY SESSION, A.D. 2023
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14	14	A N A C T
15	15	RELATING TO PUBLIC UTILITIES AND CARRIERS -- PUBLIC UTILITIES COMMISSION
16	16	Introduced By: Senator V. Susan Sosnowski
17	17	Date Introduced: March 22, 2023
18	18	Referred To: Senate Environment & Agriculture
19	19	(Public Utilities Commission)
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21	21	It is enacted by the General Assembly as follows:
22	22	SECTION 1. Section 39-1-27.7.1 of the General Laws in Chapter 39-1 entitled "Public 1
23	23	Utilities Commission" is hereby amended to read as follows: 2
24	24	39-1-27.7.1. Revenue decoupling. 3
25	25	(a) The general assembly finds and declares that electricity and gas revenues shall be fully 4
26	26	decoupled from sales pursuant to the provisions of this chapter and further finds and declares that 5
27	27	any decoupling proposal submitted by an electric distribution company as defined in § 39-1-6
28	28	2(a)(12) or gas distribution company included as a public utility in § 39-1-2(a)(20) that has greater 7
29	29	than one hundred thousand (100,000) customers, shall be for the following purposes: 8
30	30	(1) Increasing efficiency in the operations and management of the electric and gas 9
31	31	distribution system; 10
32	32	(2) Achieving the goals established in the electric distribution company’s plan for system 11
33	33	reliability and energy efficiency and conservation procurement as required pursuant to § 39-1-12
34	34	27.7(d); 13
35	35	(3) Increasing investment in least-cost resources that will reduce long-term electricity 14
36	36	demand; 15
37	37	(4) Reducing risks for both customers and the distribution company including, but not 16
38	38	limited to, societal risks, weather risks, and economic risks; 17
39	39	(5) Increasing investment in end-use energy efficiency; 18
40	40	(6) Eliminating disincentives to support energy-efficiency programs; 19
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44	44	(7) Facilitating and encouraging investment in utility infrastructure, safety, and reliability; 1
45	45	and 2
46	46	(8) Considering the reduction of fixed, recurring customer charges and transition to 3
47	47	increased unit charges that more accurately reflect the long-term costs of energy production and 4
48	48	delivery. 5
49	49	(b) Each electric distribution company as defined by § 39-1-2(a)(12) and gas distribution 6
50	50	company included as a public utility in § 39-1-2(a)(20) having greater than one hundred thousand 7
51	51	(100,000) customers shall file proposals at the commission to implement the policy set forth in 8
52	52	subsection (a) of this section. The commission shall approve these proposals, provided they contain 9
53	53	the features and components set forth in subsection (c) of this section, and that they are consistent 10
54	54	with the intent and objectives contained in subsection (a) of this section. Actions taken by the 11
55	55	commission in the exercise of its ratemaking authority for electric and gas rate cases shall be within 12
56	56	the norm of industry standards and recognize the need to maintain the financial health of the 13
57	57	distribution company as a stand-alone entity in Rhode Island. 14
58	58	(c) The proposals shall contain the following features and components: 15
59	59	(1) A revenue decoupling reconciliation mechanism that reconciles annually the revenue 16
60	60	requirement allowed in the company’s base distribution-rate case to revenues actually received for 17
61	61	the applicable twelve-month (12) period; provided that the mechanism for gas distribution shall be 18
62	62	determined on a revenue-per-customer basis, in a manner typically employed for gas distribution 19
63	63	companies in the industry. Any revenues over-recovered or under-recovered shall be credited to, 20
64	64	or recovered from, customers, as applicable; and 21
65	65	(2) An annual infrastructure, safety, and reliability spending plan for each fiscal year and 22
66	66	an annual rate-reconciliation mechanism that includes a reconcilable allowance for the anticipated 23
67	67	capital investments and other spending pursuant to the annual pre-approved budget as developed 24
68	68	in accordance with subsection (d) of this section. 25
69	69	(d) Prior to the beginning of each fiscal year, gas and electric distribution companies shall 26
70	70	consult with the division of public utilities and carriers regarding their infrastructure, safety, and 27
71	71	reliability spending plan for the following fiscal year, addressing the following categories: 28
72	72	(1) Capital spending on utility infrastructure; 29
73	73	(2) For electric distribution companies, operation and maintenance expenses on vegetation 30
74	74	management; 31
75	75	(3) For electric distribution companies, operation and maintenance expenses on system 32
76	76	inspection, including expenses from expected resulting repairs; and 33
77	77	(4) Any other costs relating to maintaining safety and reliability that are mutually agreed 34
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81	81	upon by the division and the company. 1
82	82	The distribution company shall submit a plan to the division and the division shall 2
83	83	cooperate in good faith to reach an agreement on a proposed plan for these categories of costs for 3
84	84	the prospective fiscal year within sixty (60) days. To the extent that the company and the division 4
85	85	mutually agree on a plan, such plan shall be filed with the commission for review and approval 5
86	86	within ninety (90) days. If the company and the division cannot agree on a plan, the company shall 6
87	87	file a proposed plan with the commission and the commission shall review and, if the investments 7
88	88	and spending are found to be reasonably needed to maintain safe and reliable distribution service 8
89	89	over the short and long term, approve the plan within ninety (90) days. 9
90	90	(e) The commission shall have the following duties and powers, in addition to its existing 10
91	91	authorities established in this title: 11
92	92	(1) To maintain reasonable and adequate service-quality standards, after decoupling, that 12
93	93	are in effect at the time of the proposal and were established pursuant to § 39-3-7. 13
94	94	(2) The commission may exclude the low-income rate class from the revenue decoupling 14
95	95	reconciliation-rate mechanism for either electric or gas distribution. The commission also may 15
96	96	exclude customers in the large commercial and industrial rate class from the gas-distribution 16
97	97	mechanism. 17
98	98	(3) The commission may adopt performance incentives for the electric distribution 18
99	99	company that provide a shared-savings mechanism whereby the company would receive a 19
100	100	percentage of savings realized as a result of achieving the purposes of this section while the 20
101	101	remaining savings are credited to customers. 21
102	102	(4) The commission shall review and approve, with any necessary amendments, 22
103	103	performance-based, energy-savings targets developed and submitted by the Rhode Island energy 23
104	104	efficiency and resources management council. The performance-based targets shall also be used as 24
105	105	a consideration in any shared-savings mechanism established by the commission pursuant to 25
106	106	subsection (e)(3) of this section. 26
107	107	(f) The Rhode Island energy efficiency and resources management council shall propose 27
108	108	performance-based, energy-savings targets to the commission no later than September 1, 2010. The 28
109	109	targets shall include, but not be limited to, specific energy kilowatt-hour savings overall and peak-29
110	110	demand savings for both summer and winter peak periods expressed in total megawatts as well as 30
111	111	appropriate targets recommended in the opportunities report filed with the commission pursuant to 31
112	112	§ 39-1-27.7(d)(3). The council shall revise, as necessary, these targets on an annual basis prior to 32
113	113	the reconciliation process established pursuant to subsection (c) of this section and submit its 33
114	114	revisions to the commission for approval. 34
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118	118	(g) Reporting. Every electric distribution company, as defined in subsection (a) of this 1
119	119	section, shall report to the governor, general assembly, division of public utilities and carriers, and 2
120	120	public utilities commission on or before September 1, 2012. The report shall include, but not be 3
121	121	limited to, the following elements: 4
122	122	(1) A comparison of revenues from traditional rate regulation and how the revenues have 5
123	123	differed as part of an approved decoupling structure; 6
124	124	(2) A summary of how the company is achieving the performance-based targets that may 7
125	125	have been adopted pursuant to subsection (e)(4) of this section; 8
126	126	(3) A summary of any shared savings the company may have received pursuant to the 9
127	127	performance incentives authorized in subsection (e)(3) of this section; 10
128	128	(4) A summary of how the company is achieving the service-quality standards required in 11
129	129	subsection (e)(1) of this section; 12
130	130	(5) An overview of how decoupling is impacting revenue stabilization goals that have 13
131	131	resulted from decoupling; and 14
132	132	(6) A summary of any customer education programs provided. 15
133	133	SECTION 2. This act shall take effect upon passage. 16
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140	140	EXPLANATION
141	141	BY THE LEGISLATIVE COUNCIL
142	142	OF
143	143	A N A C T
144	144	RELATING TO PUBLIC UTILITIES AND CARRIERS -- PUBLIC UTILITIES COMMISSION
145	145	***
146	146	This act would amend the revenue decoupling reconciliation mechanism used by a gas 1
147	147	distribution company for the purposes of revenue decoupling to not require that distribution be 2
148	148	determined on a revenue-per-customer basis. 3
149	149	This act would take effect upon passage. 4
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