Full Text of HB0014 97th General Assembly
HB0014ham003 97TH GENERAL ASSEMBLY | Rep. Karen May Filed: 5/13/2011
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| 1 | | AMENDMENT TO HOUSE BILL 14
| 2 | | AMENDMENT NO. ______. Amend House Bill 14, AS AMENDED, by | 3 | | replacing everything after the enacting clause with the | 4 | | following:
| 5 | | "Section 5. The Public Utilities Act is amended by changing | 6 | | Section 9-201 and by adding Sections 9-220.3 and 9-228 as | 7 | | follows:
| 8 | | (220 ILCS 5/9-201) (from Ch. 111 2/3, par. 9-201)
| 9 | | Sec. 9-201.
(a) Unless the Commission otherwise orders, and | 10 | | except as
otherwise provided in this Section, no change shall | 11 | | be made by any
public utility in any rate or other charge or | 12 | | classification, or in any
rule, regulation, practice or | 13 | | contract relating to or affecting any rate
or other charge, | 14 | | classification or service, or in any privilege or
facility, | 15 | | except after 45 days' notice to the Commission and to the
| 16 | | public as herein provided. Such notice shall be given by filing |
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| 1 | | with
the Commission and keeping open for public inspection new | 2 | | schedules or
supplements stating plainly the change or changes | 3 | | to be made in the
schedule or schedules then in force, and the | 4 | | time when the change or
changes will go into effect, and by | 5 | | publication in a newspaper of
general circulation or such other | 6 | | notice to persons affected by such
change as may be prescribed | 7 | | by rule of the Commission. The Commission,
for good cause | 8 | | shown, may allow changes without requiring the 45 days'
notice | 9 | | herein provided for, by an order specifying the changes so to | 10 | | be
made and the time when they shall take effect and the manner | 11 | | in which
they shall be filed and published.
| 12 | | When any change is proposed in any rate or other charge, or
| 13 | | classification, or in any rule, regulation, practice, or | 14 | | contract
relating to or affecting any rate or other charge, | 15 | | classification or
service, or in any privilege or facility, | 16 | | such proposed change shall be
plainly indicated on the new | 17 | | schedule filed with the Commission, by some
character to be | 18 | | designated by the Commission, immediately preceding or
| 19 | | following the item.
| 20 | | When any public utility providing water or sewer service | 21 | | proposes any
change in any rate or other charge, or | 22 | | classification, or in any rule,
regulation, practice, or | 23 | | contract relating to or affecting any rate or
other charge, | 24 | | classification or service, or in any privilege or facility,
| 25 | | such utility shall, in addition to the other notice | 26 | | requirements of this
Act, provide notice of such change to all |
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| 1 | | customers potentially affected by
including a notice and | 2 | | description of such change, and of Commission
procedures for | 3 | | intervention, in the first bill sent to each such customer
| 4 | | after the filing of the proposed change.
| 5 | | (b) Whenever there shall be filed with the Commission any | 6 | | schedule
stating an individual or joint rate or other charge, | 7 | | classification,
contract, practice, rule or regulation, the | 8 | | Commission shall have power,
and it is hereby given authority, | 9 | | either upon complaint or upon its own
initiative without | 10 | | complaint, at once, and if it so orders, without
answer or | 11 | | other formal pleadings by the interested public utility or
| 12 | | utilities, but upon reasonable notice, to enter upon a hearing
| 13 | | concerning the propriety of such rate or other charge, | 14 | | classification,
contract, practice, rule or regulation, and | 15 | | pending the hearing and
decision thereon, such rate or other | 16 | | charge, classification, contract,
practice, rule or regulation | 17 | | shall not go into effect. The period of
suspension of such rate | 18 | | or other charge, classification, contract,
practice, rule or | 19 | | regulation shall not extend more than 105 days beyond
the time | 20 | | when such rate or other charge, classification, contract,
| 21 | | practice, rule or regulation would otherwise go into effect | 22 | | unless the
Commission, in its discretion, extends the period of | 23 | | suspension for a
further period of not exceeding 6 months. The | 24 | | Commission may further extend this suspension period for a | 25 | | period equivalent to the length of any delay that the | 26 | | Commission finds to have been caused by the applicant's failure |
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| 1 | | to provide data or information requested by the Commission or | 2 | | that the Commission ordered the applicant to provide to the | 3 | | parties.
| 4 | | All rates or other charges, classifications, contracts, | 5 | | practices, rules or
regulations not so suspended shall, on the | 6 | | expiration of 45 days from
the time of filing the same with the | 7 | | Commission, or of such lesser time
as the Commission may grant, | 8 | | go into effect and be the established and
effective rates or | 9 | | other charges, classifications, contracts, practices,
rules | 10 | | and regulations, subject to the power of the Commission, after | 11 | | a
hearing had on its own motion or upon complaint, as herein | 12 | | provided, to
alter or modify the same.
| 13 | | Within 30 days after such changes have been
authorized by | 14 | | the Commission, copies of the new or revised schedules
shall be | 15 | | posted or filed in accordance with the terms of Section 9-103 | 16 | | of
this Act, in such a manner that all changes shall be plainly | 17 | | indicated. The Commission shall incorporate into the period of | 18 | | suspension a review period of 4 business days during which the | 19 | | Commission may review and determine whether the new or revised | 20 | | schedules comply with the Commission's decision approving a | 21 | | change to the public utility's rates. Such review period shall | 22 | | not extend the suspension period by more than 2 days. Absent | 23 | | notification to the contrary within the 4 business day period, | 24 | | the new or revised schedules shall be deemed approved.
| 25 | | (c) If the Commission enters upon a hearing concerning the | 26 | | propriety of
any proposed rate or other charge, classification, |
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| 1 | | contract, practice, rule
or regulation, the Commission shall | 2 | | establish the rates or other charges,
classifications, | 3 | | contracts, practices, rules or regulations proposed, in
whole | 4 | | or in part, or others in lieu thereof, which it shall find to | 5 | | be just
and reasonable. In such hearing, the burden of proof to | 6 | | establish the justness
and reasonableness of the proposed rates | 7 | | or other charges, classifications,
contracts, practices, rules | 8 | | or regulations, in whole and in part, shall be
upon the | 9 | | utility. The utility, the staff of the Commission, the Attorney | 10 | | General, or any party to a proceeding initiated under this | 11 | | Section who has been granted intervenor status and submitted a | 12 | | post-hearing brief must be given the opportunity to present | 13 | | oral argument, if requested no later than the date for filing | 14 | | exceptions, on the propriety of any proposed rate or other | 15 | | charge, classification, contract, practice, rule, or | 16 | | regulation. No rate or other charge, classification, contract,
| 17 | | practice, rule or regulation shall be found just and reasonable | 18 | | unless it
is consistent with Sections of this Article. | 19 | | (d) Except where compliance with Section 8-401 of this Act | 20 | | is of urgent and immediate concern, no representative of a | 21 | | public utility may discuss with a commissioner, commissioner's | 22 | | assistant, or hearing examiner in a non-public setting a | 23 | | planned filing for a general rate increase. If a public utility | 24 | | makes a filing under this Section, then no substantive | 25 | | communication by any such person with a commissioner, | 26 | | commissioner's assistant or hearing examiner concerning the |
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| 1 | | filing is permitted until a notice of hearing has been issued. | 2 | | After the notice of hearing has been issued, the only | 3 | | communications by any such person with a commissioner, | 4 | | commissioner's assistant, or hearing examiner concerning the | 5 | | filing permitted are communications permitted under Section | 6 | | 10-103 of this Act. If any such communication does occur, then | 7 | | within 5 days of the docket being initiated all details | 8 | | relating to the communication shall be placed on the public | 9 | | record of the proceeding. The record shall include any | 10 | | materials, whether written, recorded, filmed, or graphic in | 11 | | nature, produced or reproduced on any media, used in connection | 12 | | with the communication. The record shall reflect the names of | 13 | | all persons who transmitted, received, or were otherwise | 14 | | involved in the communication, the duration of the | 15 | | communication, and whether the communication occurred in | 16 | | person or by other means. In the case of an oral communication, | 17 | | the record shall also reflect the location or locations of all | 18 | | persons involved in the communication and, if the communication | 19 | | occurred by telephone, the telephone numbers for the callers | 20 | | and recipients of the communication. A commissioner, | 21 | | commissioner's assistant, or hearing examiner who is involved | 22 | | in any such communication shall be recused from the affected | 23 | | proceeding. The Commission, or any commissioner or hearing | 24 | | examiner presiding over the proceeding shall, in the event of a | 25 | | violation of this Section, take action necessary to ensure that | 26 | | such violation does not prejudice any party or adversely affect |
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| 1 | | the fairness of the proceedings including dismissing the | 2 | | affected proceeding. Nothing in this subsection (d) is intended | 3 | | to preclude otherwise allowable updates on issues that may be | 4 | | indirectly related to a general rate case filing because cost | 5 | | recovery for the underlying activity may be requested. Such | 6 | | updates may include, without limitation, issues related to | 7 | | outages and restoration, credit ratings, security issuances, | 8 | | reliability, Federal Energy Regulatory Commission matters, | 9 | | Federal Communications Commission matters, regional | 10 | | reliability organizations, consumer education, or labor | 11 | | matters, provided that such updates may not include cost | 12 | | recovery in a planned rate case.
| 13 | | (Source: P.A. 96-33, eff. 7-10-09.)
| 14 | | (220 ILCS 5/9-220.3 new) | 15 | | Sec. 9-220.3. Electric utility infrastructure enhancement | 16 | | cost recovery mechanism. | 17 | | (a) If the Commission finds that substantial investments | 18 | | are needed to refurbish, rebuild, modernize, expand, or create | 19 | | systems to maintain or improve upon a utility's ability to | 20 | | provide safe, reliable, high-quality, and affordable electric | 21 | | service to the State's current and future utility customers, | 22 | | then the Commission may encourage such investments by | 23 | | authorizing utilities to recover such investments, including a | 24 | | reasonable return on such investments, if they are reasonably | 25 | | and prudently incurred, through special cost-tracking |
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| 1 | | mechanisms, as further defined in this Section. For purposes of | 2 | | this Section, systems to maintain or improve upon a utility's | 3 | | ability to provide safe, reliable, high-quality, and | 4 | | affordable electric service to the State's current and future | 5 | | utility customers may include, but need not be limited to, | 6 | | innovative technologies and infrastructure expected to enhance | 7 | | customers' control over their energy consumption, better | 8 | | identify and control outages, and lead to more widespread or | 9 | | efficient use of distributed generation, renewable energy, | 10 | | energy efficiency, demand response, and other energy | 11 | | resources. | 12 | | (b) To be eligible to recover investments pursuant to the | 13 | | special cost-tracking mechanism, a utility must submit to the | 14 | | Commission a petition, which must include the following: | 15 | | (1) A description of the utility's plans to refurbish, | 16 | | rebuild, modernize, expand, or create systems to maintain | 17 | | or improve upon the utility's ability to provide safe, | 18 | | reliable, high-quality, and affordable electric service to | 19 | | the State's current and future utility customers. This plan | 20 | | description must include estimated investments for each | 21 | | element of the plan, the changes that would be made to | 22 | | existing systems, and the new systems that would be | 23 | | created, an explanation of how such changes and additions | 24 | | would be used and useful for maintaining or improving upon | 25 | | a utility's ability to provide safe, reliable, | 26 | | high-quality, and affordable electric service to the |
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| 1 | | State's current and future utility customers, and a present | 2 | | value of future revenue requirements study that shows a | 3 | | cost comparison between each element of the plan and all | 4 | | reasonable alternatives. | 5 | | (2) A description and quantification, to the extent | 6 | | possible, of the risks involved both in carrying out the | 7 | | plan and in not carrying out the plan. | 8 | | (3) The proposed formula or formulas that would be | 9 | | utilized to compute the rates through which investments | 10 | | would be recovered, which shall include a true-up provision | 11 | | from the prior period's under or over collection of costs. | 12 | | (4) The proposed accounting system and protocols that | 13 | | would be utilized to distinguish between expenses and | 14 | | investments recovered through existing rate mechanisms and | 15 | | expenses and investments that would be recovered through | 16 | | the proposed special cost-tracking mechanism. | 17 | | (5) A report on the expected impact of the utility's | 18 | | plans on economic development, State and local tax | 19 | | revenues, and net job creation within Illinois. | 20 | | (6) The proposed reports through which the utility | 21 | | would keep the Commission informed of progress toward | 22 | | refurbishing, rebuilding, modernizing, expanding, or | 23 | | creating systems, as identified in the plans described in | 24 | | relation to paragraph (1), as well as all material changes | 25 | | to those plans. | 26 | | (7) Schedules, showing key dates for implementation of |
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| 1 | | the plan, establishment of the special cost-tracking | 2 | | mechanism, submittal of proposed reports, and the updating | 3 | | of formulas. | 4 | | (8) Any other information that the utility believes | 5 | | necessary to establish the appropriateness of its plans and | 6 | | its proposed special cost-tracking mechanism. | 7 | | (9) Verified statements of qualified experts, | 8 | | attesting to the veracity of the information contained in | 9 | | the petition, and to the likelihood of implementing the | 10 | | plan and the proposed special cost-tracking mechanism | 11 | | within the time frame specified in the proposed schedules. | 12 | | (c) The Commission shall issue an order with respect to a | 13 | | special cost-tracking mechanism pursuant to this Section no | 14 | | more than 330 days following receipt of a petition filed | 15 | | pursuant to subsection (b) of this Section. The Commission | 16 | | shall enter an order approving a utility's proposed special | 17 | | cost-tracking mechanism, with or without modifications, as | 18 | | well as an implementation schedule, if it finds that: | 19 | | (1) The utility's plans to refurbish, rebuild, | 20 | | modernize, expand, or create systems are feasible, | 21 | | necessary to maintain or improve upon the utility's ability | 22 | | to provide safe, reliable, high-quality, and affordable | 23 | | electric service to the State's current and future utility | 24 | | customers, and are the least-cost means of achieving those | 25 | | results. | 26 | | (2) The benefits of the utility's plan, in terms of its |
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| 1 | | ability to maintain or improve upon a utility's ability to | 2 | | provide safe, reliable, high-quality, and affordable | 3 | | electric service to the State's current and future utility | 4 | | customers are likely to exceed the plan's costs or the | 5 | | risks involved in not carrying out the plan exceed those of | 6 | | carrying out the plan. | 7 | | (3) The special cost-tracking mechanism adopted in the | 8 | | order, including any formulas, accounting systems, or | 9 | | rates of return, or reconciliation procedures embedded | 10 | | within the mechanism: | 11 | | (A) includes only capitalized infrastructure | 12 | | investments; | 13 | | (B) includes a rate of return on common equity that | 14 | | evaluates the relative risk of cost recovery through | 15 | | the cost-tracking mechanism in comparison to the risk | 16 | | of recovery through base rates; | 17 | | (C) includes provisions for an annual | 18 | | reconciliation of amounts collected from a surcharge | 19 | | pursuant to this special cost-tracking mechanism with | 20 | | the actual, prudently incurred, and just and | 21 | | reasonable costs recoverable for each annual period | 22 | | during which the surcharge was in effect; | 23 | | (D) includes an offset for savings that are | 24 | | realized as a result of the infrastructure investment | 25 | | program for the relevant period; | 26 | | (E) includes provisions for an annual internal |
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| 1 | | audit that includes, but is not limited to, a | 2 | | determination of whether the costs recovered through | 3 | | this special cost-tracking mechanism are recovered | 4 | | through other approved tariffs, whether the surcharge | 5 | | is properly billed to customers in the correct time | 6 | | periods, whether the applicable costs and revenues are | 7 | | properly identified and recorded; | 8 | | (F) is expected to provide an adequate incentive | 9 | | for the utility to carry out its plans to refurbish, | 10 | | rebuild, modernize, expand, or create systems | 11 | | necessary to maintain or improve upon the utility's | 12 | | ability to provide safe, reliable, high-quality, and | 13 | | affordable electric service to the State's current and | 14 | | future utility customers; | 15 | | (G) is to be applied to all delivery service | 16 | | customers of the utility; and | 17 | | (H) is otherwise just and reasonable, and in the | 18 | | interests of both the utility and the utility's | 19 | | customers. | 20 | | (4) It is likely that the plan and the special | 21 | | cost-tracking mechanism adopted in the order can be | 22 | | implemented in a manner consistent with the implementation | 23 | | schedule adopted by the order. | 24 | | (5) The surcharge that results from the implementation | 25 | | of a special cost-tracking mechanism established pursuant | 26 | | to this Section shall appear as a separate line item on the |
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| 1 | | customer bill. | 2 | | The Commission's order approving a special cost-tracking | 3 | | mechanism and its implementation schedule, may further include | 4 | | requirements for periodic reporting related to the utility's | 5 | | plans or the special cost-tracking mechanism adopted in the | 6 | | order. | 7 | | If the Commission is unable to make all of the findings | 8 | | specified in paragraphs (1) through (5) of this subsection (c), | 9 | | then the Commission shall enter an order denying the utility's | 10 | | request to establish a special cost-tracking mechanism | 11 | | pursuant to this Section, and such order shall be considered to | 12 | | be a final order of the Commission subject to petitions for | 13 | | rehearing and appellate procedures. | 14 | | (d) Following the date of an order approving a special | 15 | | cost-tracking mechanism for a utility, a utility shall have 14 | 16 | | days to notify the Commission in writing whether it will accept | 17 | | any modifications so identified in the order or whether it has | 18 | | elected not to proceed with the special cost-tracking | 19 | | mechanism. If the utility notifies the Commission that it will | 20 | | accept such modifications, then the Commission shall issue an | 21 | | amended order, without further hearing, within 14 days | 22 | | following such notification, approving the program as | 23 | | modified, and such order shall be considered to be a final | 24 | | order of the Commission subject to petitions for rehearing and | 25 | | appellate procedures. | 26 | | (e) Upon 45 days' notice, a utility that is employing a |
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| 1 | | special cost-tracking mechanism pursuant to this Section may | 2 | | cancel or suspend the mechanism, without the approval of the | 3 | | Commission. | 4 | | (f) If a utility is recovering costs through a special | 5 | | cost-tracking mechanism, approved pursuant to this Section, | 6 | | after a period of 3 years after the effective date of the | 7 | | mechanism, then the Commission may, on its own motion (1) | 8 | | initiate a proceeding to consider whether the utility is | 9 | | achieving the goals of its original plan, or any subsequently | 10 | | modified plans, to refurbish, rebuild, modernize, expand, or | 11 | | create systems to maintain or improve upon the utility's | 12 | | ability to provide safe, reliable, high-quality, and | 13 | | affordable electric service to the State's current and future | 14 | | utility customers or (2) initiate a proceeding to consider | 15 | | whether subsequently modified plans continue to be in the best | 16 | | interest of the State's current and future utility customers. | 17 | | If the Commission enters an order, following a hearing process, | 18 | | finding that the utility's plans are no longer effective in | 19 | | achieving their goals, or are no longer in the best interest of | 20 | | the State's current and future utility customers, then the | 21 | | Commission may direct the utility to take one of the following | 22 | | actions, at the choice of the utility: | 23 | | (1) The utility may prepare and file with the | 24 | | Commission, within a period of 12 months after the date of | 25 | | the Commission's order, a general rate case pursuant to | 26 | | Section 9-201. When the rates pursuant to that filing go |
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| 1 | | into effect, the utility's special cost-tracking mechanism | 2 | | pursuant to this Section shall be cancelled. | 3 | | (2) The utility may request Commission approval to | 4 | | cancel its special cost-tracking mechanism, within a | 5 | | period of not more than 45 days from the date of the | 6 | | Commission's order. | 7 | | (g) There shall be a rebuttable presumption that any actual | 8 | | expenditures and investments identified within special | 9 | | cost-tracking mechanisms approved pursuant to this Section | 10 | | were prudently incurred by the utility. However, if the | 11 | | Commission enters an order, following a hearing process, | 12 | | pursuant to subsection (f) of this Section, finding that the | 13 | | utility's plans are no longer effective in achieving their | 14 | | goals, or are no longer in the best interest of the State's | 15 | | current and future utility customers, and the utility's special | 16 | | cost-tracking mechanism is subsequently cancelled or | 17 | | suspended, then the rebuttable presumption otherwise afforded | 18 | | by this subsection (g) shall not apply to costs that have not | 19 | | already been found prudent by the Commission in an annual | 20 | | reconciliation proceeding pursuant to subparagraph (D) of | 21 | | paragraph (3) of subsection (c) of this Section. | 22 | | (h) The Commission may adopt rules to implement the | 23 | | provisions of this Section. | 24 | | (220 ILCS 5/9-228 new) | 25 | | Sec. 9-228. Recovery of various costs through rates.
In |
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| 1 | | any rate requested by any gas, electric, water, or sewer | 2 | | utility company under the provisions of this Act, the following | 3 | | costs shall be considered recoverable through rates if the | 4 | | Commission determines that the costs are prudent, just, | 5 | | reasonable, and consistent with Commission practice and law: | 6 | | (1) incentive compensation expense that is based on the | 7 | | achievement of operational metrics, including metrics | 8 | | related to outage duration and frequency, safety, customer | 9 | | service, efficiency and productivity, and environmental | 10 | | compliance, but not metrics based on net income or an | 11 | | affiliate's earnings per share; | 12 | | (2) pension and other post-employment benefits expense | 13 | | based on actual costs incurred for the applicable calendar | 14 | | year, provided that such costs are supported by an | 15 | | actuarial study; | 16 | | (3) an investment return on the unamortized | 17 | | discretionary pension contributions net of deferred tax | 18 | | benefits equal to the utility's long-term debt cost | 19 | | component of the applicable Commission-approved cost of | 20 | | capital; however, in no case shall the cost associated with | 21 | | the allowed investment return be greater than the benefit | 22 | | ratepayers receive from the discretionary pension | 23 | | contribution; | 24 | | (4) severance costs amortized over a period that is | 25 | | consistent with savings resulting from the severance; | 26 | | (5) regulatory assets previously approved by the |
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| 1 | | Commission; | 2 | | (6) costs related to a Commission proceeding to approve | 3 | | a mechanism under Section 9-244 or 9-220.3 of this Act, | 4 | | amortized over a 3-year period; and | 5 | | (7) costs related to annual reconciliation Commission | 6 | | proceedings of mechanisms approved under Section 9-244 and | 7 | | 9-220.3 of this Act.
| 8 | | Section 99. Effective date. This Act takes effect upon | 9 | | becoming law.".
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