Rhode Island 2025 Regular Session

Rhode Island House Bill H5818 Compare Versions

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55 2025 -- H 5818
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99 S T A T E O F R H O D E I S L A N D
1010 IN GENERAL ASSEMBLY
1111 JANUARY SESSION, A.D. 2025
1212 ____________
1313
1414 A N A C T
1515 RELATING TO PUBLIC UTILITIES AND CARRIERS -- DUTIES OF UTILITIES AND
1616 CARRIERS
1717 Introduced By: Representatives Handy, Morales, McNamara, Solomon, Stewart,
1818 Casimiro, Potter, Fogarty, and Cortvriend
1919 Date Introduced: February 28, 2025
2020 Referred To: House Corporations
2121
2222
2323 It is enacted by the General Assembly as follows:
2424 SECTION 1. Section 39-2-1.2 of the General Laws in Chapter 39-2 entitled "Duties of 1
2525 Utilities and Carriers" is hereby amended to read as follows: 2
2626 39-2-1.2. Utility base rate — Advertising, demand-side management, and renewables. 3
2727 Utility base rate – Demand side management and renewables. 4
2828 (a) In addition to costs prohibited in § 39-1-27.4(b), no public utility distributing or 5
2929 providing heat, electricity, or water to or for the public shall include as part of its base rate any 6
3030 expenses for advertising, either direct or indirect, that promotes the use of its product or service, or 7
3131 is designed to promote the public image of the industry. No public utility may furnish support of 8
3232 any kind, direct or indirect, to any subsidiary, group, association, or individual for advertising and 9
3333 include the expense as part of its base rate. Nothing contained in this section shall be deemed as 10
3434 prohibiting the inclusion in the base rate of expenses incurred for advertising, informational or 11
3535 educational in nature, that is designed to promote public safety conservation of the public utility’s 12
3636 product or service. The public utilities commission shall promulgate such rules and regulations as 13
3737 are necessary to require public disclosure of all advertising expenses of any kind, direct or indirect, 14
3838 and to otherwise effectuate the provisions of this section. 15
3939 (b) Effective as of January 1, 2008, and for a period of twenty (20) years thereafter, each 16
4040 electric distribution company shall include a charge per kilowatt-hour delivered to fund demand-17
4141 side management programs. The 0.3 mills per kilowatt-hour delivered to fund renewable energy 18
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4545 programs shall remain in effect until December 31, 2028. The electric distribution company shall 1
4646 establish and, after July 1, 2007, maintain, two (2) separate accounts, one for demand-side 2
4747 management programs (the “demand-side account”), which shall be funded by the electric demand-3
4848 side charge and administered and implemented by the distribution company, subject to the 4
4949 regulatory reviewing authority of the commission, and one for renewable energy programs, which 5
5050 shall be administered by the Rhode Island commerce corporation pursuant to § 42-64-13.2 and shall 6
5151 be held and disbursed by the distribution company as directed by the Rhode Island commerce 7
5252 corporation for the purposes of developing, promoting, and supporting renewable energy programs. 8
5353 During the time periods established in this subsection, the commission may, in its 9
5454 discretion, after notice and public hearing, increase the sums for demand-side management and 10
5555 renewable resources. In addition, the commission shall, after notice and public hearing, determine 11
5656 the appropriate charge for these programs. The office of energy resources, and/or the administrator 12
5757 of the renewable energy programs, may seek to secure for the state an equitable and reasonable 13
5858 portion of renewable energy credits or certificates created by private projects funded through those 14
5959 programs. As used in this section, “renewable energy resources” shall mean: (1) Power generation 15
6060 technologies, as defined in § 39-26-5, “eligible renewable energy resources,” including off-grid 16
6161 and on-grid generating technologies located in Rhode Island, as a priority; (2) Research and 17
6262 development activities in Rhode Island pertaining to eligible renewable energy resources and to 18
6363 other renewable energy technologies for electrical generation; or (3) Projects and activities directly 19
6464 related to implementing eligible renewable energy resources projects in Rhode Island. 20
6565 Technologies for converting solar energy for space heating or generating domestic hot water may 21
6666 also be funded through the renewable energy programs. Fuel cells may be considered an energy 22
6767 efficiency technology to be included in demand-side management programs. Special rates for low-23
6868 income customers in effect as of August 7, 1996, shall be continued, and the costs of all of these 24
6969 discounts shall be included in the distribution rates charged to all other customers. Nothing in this 25
7070 section shall be construed as prohibiting an electric distribution company from offering any special 26
7171 rates or programs for low-income customers which are not in effect as of August 7, 1996, subject 27
7272 to the approval by the commission. 28
7373 (1) The renewable energy investment programs shall be administered pursuant to rules 29
7474 established by the Rhode Island commerce corporation. Said rules shall provide transparent criteria 30
7575 to rank qualified renewable energy projects, giving consideration to: 31
7676 (i) The feasibility of project completion; 32
7777 (ii) The anticipated amount of renewable energy the project will produce; 33
7878 (iii) The potential of the project to mitigate energy costs over the life of the project; and 34
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8282 (iv) The estimated cost per kilowatt-hour (KWh) of the energy produced from the project. 1
8383 (c) [Deleted by P.L. 2012, ch. 241, art. 4, § 14.] 2
8484 (d) The chief executive officer of the commerce corporation is authorized and may enter 3
8585 into a contract with a contractor for the cost-effective administration of the renewable energy 4
8686 programs funded by this section. A competitive bid and contract award for administration of the 5
8787 renewable energy programs may occur every three (3) years and shall include, as a condition, that 6
8888 after July 1, 2008, the account for the renewable energy programs shall be maintained and 7
8989 administered by the commerce corporation as provided for in subsection (b) of this section. 8
9090 (e) Effective January 1, 2007, and for a period of twenty-one (21) years thereafter, each 9
9191 gas distribution company shall include, with the approval of the commission, a charge per deca 10
9292 therm delivered to fund demand-side management programs (the “gas demand-side charge”), 11
9393 including, but not limited to, programs for cost-effective energy efficiency, energy conservation, 12
9494 combined heat and power systems, and weatherization services for low-income households. 13
9595 (f) Each gas company shall establish a separate account for demand-side management 14
9696 programs (the “gas demand-side account”) that shall be funded by the gas demand-side charge and 15
9797 administered and implemented by the distribution company, subject to the regulatory reviewing 16
9898 authority of the commission. The commission may establish administrative mechanisms and 17
9999 procedures that are similar to those for electric demand-side management programs administered 18
100100 under the jurisdiction of the commission and that are designed to achieve cost-effectiveness and 19
101101 high, life-time savings of efficiency measures supported by the program. 20
102102 (g) The commission may, if reasonable and feasible, except from this demand-side 21
103103 management charge: 22
104104 (1) Gas used for distribution generation; and 23
105105 (2) Gas used for the manufacturing processes, where the customer has established a self-24
106106 directed program to invest in and achieve best-effective energy efficiency in accordance with a plan 25
107107 approved by the commission and subject to periodic review and approval by the commission, which 26
108108 plan shall require annual reporting of the amount invested and the return on investments in terms 27
109109 of gas savings. 28
110110 (h) The commission may provide for the coordinated and/or integrated administration of 29
111111 electric and gas demand-side management programs in order to enhance the effectiveness of the 30
112112 programs. Such coordinated and/or integrated administration may after March 1, 2009, upon the 31
113113 recommendation of the office of energy resources, be through one or more third-party entities 32
114114 designated by the commission pursuant to a competitive selection process. 33
115115 (i) Effective January 1, 2007, the commission shall allocate, from demand-side 34
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119119 management gas and electric funds authorized pursuant to this section, an amount not to exceed 1
120120 three percent (3%) of such funds on an annual basis for the retention of expert consultants, and 2
121121 reasonable administration costs of the energy efficiency and resource management council 3
122122 associated with planning, management, and evaluation of energy-efficiency programs, renewable 4
123123 energy programs, system reliability, least-cost procurement, and with regulatory proceedings, 5
124124 contested cases, and other actions pertaining to the purposes, powers, and duties of the council, 6
125125 which allocation may by mutual agreement, be used in coordination with the office of energy 7
126126 resources to support such activities. 8
127127 (j) Effective January 1, 2016, the commission shall annually allocate from the 9
128128 administrative funding amount allocated in subsection (i) from the demand-side management 10
129129 program as described in subsection (i) as follows: (1) for the energy efficiency and resource 11
130130 management council, no more than forty percent (40%) for the purposes identified in subsection (i) 12
131131 and (2) sixty percent (60%) of three percent (3%) from the demand-side management gas and 13
132132 electric funds annually to the office of energy resources for activities associated with planning, 14
133133 management, and evaluation of energy-efficiency programs, renewable energy programs, system 15
134134 reliability, least-cost procurement, and with regulatory proceedings, contested cases, and other 16
135135 actions pertaining to the purposes, powers, and duties of the office of energy resources and shall 17
136136 have exclusive authority to direct the use of the office administrative and programmatic funds. 18
137137 (k) On April 15, of each year, the office and the council shall submit to the governor, the 19
138138 president of the senate, and the speaker of the house of representatives, separate financial and 20
139139 performance reports regarding the demand-side management programs, including the specific level 21
140140 of funds that were contributed by the residential, municipal, and commercial and industrial sectors 22
141141 to the overall programs; the businesses, vendors, and institutions that received funding from 23
142142 demand-side management gas and electric funds used for the purposes in this section; and the 24
143143 businesses, vendors, and institutions that received the administrative funds for the purposes in 25
144144 subsections (i) and (j). These reports shall be posted electronically on the websites of the office of 26
145145 energy resources and the energy efficiency and resources management council. 27
146146 (l) On or after August 1, 2015, at the request of the Rhode Island infrastructure bank, each 28
147147 electric distribution company, except for the Pascoag Utility District and Block Island Power 29
148148 Company, shall remit two percent (2%) of the amount of the 2014 electric demand-side charge 30
149149 collections to the Rhode Island infrastructure bank. 31
150150 (m) On or after August 1, 2015, at the request of the Rhode Island infrastructure bank, each 32
151151 gas distribution company shall remit two percent (2%) of the amount of the 2014 gas demand-side 33
152152 charge collections to the Rhode Island infrastructure bank. 34
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156156 (n) Effective January 1, 2022, the commission shall allocate, from demand-side 1
157157 management gas and electric funds authorized pursuant to this section, five million dollars 2
158158 ($5,000,000) of such funds on an annual basis to the Rhode Island infrastructure bank. Gas and 3
159159 electric demand-side funds transferred to the Rhode Island infrastructure bank pursuant to this 4
160160 section shall be eligible to be used in any energy efficiency, renewable energy, clean transportation, 5
161161 clean heating, energy storage, or demand-side management project financing program administered 6
162162 by the Rhode Island infrastructure bank notwithstanding any other restrictions on the use of such 7
163163 collections set forth in this chapter. The infrastructure bank shall report annually to the commission 8
164164 within ninety (90) days of the end of each calendar year how collections transferred under this 9
165165 section were utilized. 10
166166 (o) The Rhode Island office of energy resources, in coordination with the energy efficiency 11
167167 and resource management council, and following consultation with the public utilities commission 12
168168 and division of public utilities and carriers, shall issue a request for proposals for the cost-effective 13
169169 administration and implementation of statewide energy efficiency programs funded by this section 14
170170 no later than September 30, 2023. The draft request for proposals shall be reviewed through at least 15
171171 one technical session at the public utilities commission prior to issuance. Public utilities 16
172172 commission approval shall not be required. The Rhode Island office of energy resources, in 17
173173 coordination with the energy efficiency and resource management council, shall evaluate proposals 18
174174 and determine whether energy efficiency administration and implementation by the electric and gas 19
175175 distribution company or a third party is likely to achieve the most net benefits for electric and gas 20
176176 customers in Rhode Island. After January 1, 2025, the office of energy resources may, periodically, 21
177177 and at its discretion, issue additional requests for proposals for the administration and 22
178178 implementation of statewide energy efficiency programs funded through this chapter of an electric 23
179179 distribution company as defined in § 39-1-2(a)(12) or gas distribution company included as a 24
180180 public utility in § 39-1-2(a)(20) that has greater than one hundred thousand (100,000) customers. 25
181181 (1) Nothing in this chapter shall prohibit the electric and/or gas distribution company from 26
182182 submitting a proposal to administer and implement the state energy efficiency programs. 27
183183 (2) If the office of energy resources, in coordination with the energy efficiency and resource 28
184184 management council, determines that the use of a third-party administrator is likely to achieve the 29
185185 most net benefits for electric and gas customers in Rhode Island, it shall file its recommendation 30
186186 with the public utilities commission, which shall docket and rule on the matter pursuant to its 31
187187 general statutory authorization. 32
188188 (3) If the commission determines that the recommended third-party administrator is in the 33
189189 interest of Rhode Island utility customers, it shall provide for the full cost recovery for the third-34
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193193 party administrator consistent with the terms of the approved contract, and which shall reflect the 1
194194 overall annual budget approved by the commission. The third-party administrator shall be subject 2
195195 to all the requirements set forth for the electric and gas distribution company per § 39-1-27.7. 3
196196 (4) If the commission determines that a third-party administrator will administer the state 4
197197 energy efficiency programs on or after June 1, 2024, the commission shall direct the gas and electric 5
198198 distribution company to collect and transfer the gas and electric energy efficiency funds to the third-6
199199 party administrator for the annual state energy efficiency program beginning with the program year 7
200200 and thereafter for the remaining program years. The gas and electric distribution company shall 8
201201 transfer the annual administrative funds to the office of energy resources and energy efficiency and 9
202202 resource management council. 10
203203 (5) If a third-party administrator implements the annual energy efficiency programs then 11
204204 they shall be required to develop and design the annual state energy efficiency program with the 12
205205 office of energy resources and energy efficiency and resource management council, including a 13
206206 vote by the energy efficiency and resource management council prior to the third-party 14
207207 administrator filing the annual program plan to the public utilities commission for review and a 15
208208 decision. 16
209209 (6) The third-party administrator shall file the annual state energy efficiency program plan 17
210210 to the public utilities commission for review and approval no later than September 30, 2024, and 18
211211 annually thereafter on such date. 19
212212 (7) The third-party administrator shall provide all information requested by the office of 20
213213 energy resources, energy efficiency and resource management council, division of public utilities 21
214214 and carriers, and the public utilities commission, including responses to data requests, which are 22
215215 necessary for the agencies to carry out their respective oversight roles, and shall be accountable to 23
216216 the same standards as the utility with administering and implementing energy efficiency, system 24
217217 reliability, and least-cost procurement standards and goals in accordance with § 39-1-27.7 and this 25
218218 section. 26
219219 (8) If the office does not recommend advancement of a third-party administrator, the 27
220220 electric and gas distribution company shall continue to administer statewide energy efficiency 28
221221 programs. 29
222222 SECTION 2. Chapter 39-2 of the General Laws entitled "Duties of Utilities and Carriers" 30
223223 is hereby amended by adding thereto the following section: 31
224224 39-2-1.5. Utility base rate -- Prohibitions on advertising, political, charitable, and 32
225225 investor-related expenses. 33
226226 (a) In addition to costs prohibited in § 39-1-27.4(b), no public utility serving greater than 34
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230230 one hundred thousand (100,000) customers distributing or providing heat, electricity, or water to 1
231231 or for the public shall recover through rates any direct or indirect cost associated with: 2
232232 (1) Advertising, marketing, communications, or public education that seek to influence 3
233233 public opinion, including any costs associated with activities such as research, analysis, preparation 4
234234 or planning undertaken in support of advertising, marketing, communications, or public education, 5
235235 or any other related costs identified by the commission, unless such marketing, advertising, 6
236236 communications or related costs are specifically approved or ordered by the commission; 7
237237 (2) Membership dues, sponsorships or contributions to a business or industry trade 8
238238 association, group or related entity incorporated under Section 501 of the Internal Revenue Code 9
239239 of 1986, as amended; 10
240240 (3) Charitable giving expenses, including contributions to organizations qualified under 11
241241 section 501(c)(3) or 501(c)(4) of the Internal Revenue Code of 1986, as amended; 12
242242 (4) Lobbying as defined in § 42-139.1-3; 13
243243 (5) Contributions to political candidates, campaign committees, issue committees, or 14
244244 independent expenditure committees or similar political expenses; 15
245245 (6) Litigation to influence, modify, or repeal existing federal, state or local regulations, 16
246246 legislation or ordinances; 17
247247 (7) Marketing and administration or customer service for unregulated products or services 18
248248 provided or sold by the utility or the utility’s affiliates; 19
249249 (8) Tax penalties or fines issued against the utility; and 20
250250 (9)(i) Travel, lodging or food and beverage expenses for such company’s board of directors 21
251251 and officers or the board of directors and officers of such company’s parent company; 22
252252 (ii) Entertainment or gifts; 23
253253 (iii) Any owned, leased or chartered aircraft for such company’s board of directors and 24
254254 officers or the board of directors and officers of such company’s parent company; or 25
255255 (iv) Investor relations. 26
256256 (b) For any rate proceeding or infrastructure, safety and reliability proceeding, as described 27
257257 in § 39-1-27.7.1(d), initiated on or after July 1, 2025, an electric distribution company, gas 28
258258 company, pipeline company, or water company with more than one hundred thousand (100,000) 29
259259 customers shall not recover through rates its direct or indirect costs associated with its attendance 30
260260 in, participation in, preparation for, or appeal of such rate proceeding. Such costs shall include, but 31
261261 need not be limited to, attorneys’ fees, fees to engage expert witnesses or consultants, the portion 32
262262 of employee salaries associated with such attendance, participation, preparation or appeal of a 33
263263 contested proceeding and related costs identified by the commission. 34
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267267 (c) The commission may initiate rulemaking to implement the requirements of this chapter. 1
268268 SECTION 3. This act shall take effect upon passage. 2
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275275 EXPLANATION
276276 BY THE LEGISLATIVE COUNCIL
277277 OF
278278 A N A C T
279279 RELATING TO PUBLIC UTILITIES AND CARRIERS -- DUTIES OF UTILITIES AND
280280 CARRIERS
281281 ***
282282 This act would prohibit public utilities, serving greater than one hundred thousand 1
283283 (100,000) customers from recovering through rates any direct or indirect cost associated with, 2
284284 amongst other costs, advertising, marketing, communications, or public education that seek to 3
285285 influence public opinion, including any costs associated with activities such as research, analysis, 4
286286 preparation or planning undertaken in support of advertising, marketing, communications, or public 5
287287 education, or any other related costs identified by the commission. 6
288288 This act would take effect upon passage. 7
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