Virginia Senate Bill SB1417

Virginia 2023 Regular Session

• Introduced: 1/11/23
• Refer: 1/11/23

Caption

Electric utilities; proposed cost recovery, alternative to rate adjustment clause.

Impact

The enactment of SB1417 is expected to alter the landscape of costs recovered by electric utilities. It empowers the Commission with more latitude in decision-making processes regarding cost recovery, potentially simplifying the procedure for utilities while aiming to ensure continual fair returns. This change could lead to adjustments in how rates are set and recovered, influencing operational efficiencies and possibly affecting consumer rates in the long run.

Summary

SB1417 introduces an amendment to how electric utilities can seek cost recovery in Virginia. It allows the State Corporation Commission (the Commission) to authorize recovery of proposed costs through a utility's rates for generation and distribution services as an alternative to the traditional rate adjustment clause process. This shift is intended to provide greater flexibility for utilities while ensuring that ratepayers are still protected and receive fair service rates. The Commission has the discretionary power to determine what method serves the best interest of ratepayers.

Contention

While the bill may offer benefits in terms of flexibility and efficiency for utilities, it has raised concerns among various stakeholders. Critics worry that it may lead to an environment where utility companies have increased power over rate adjustments without sufficient oversight, raising the risk of higher costs for consumers. The debate centers around the balance of ensuring fair rates for consumers versus providing utilities with the ability to manage their operational costs effectively. The bill's history suggests some division in opinions, as it passed with mixed votes in the Senate committee, indicating potential areas of contention among legislators.