Full Text of SB1705 94th General Assembly
SB1705enr 94TH GENERAL ASSEMBLY
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| AN ACT concerning regulation.
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| Be it enacted by the People of the State of Illinois,
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| represented in the General Assembly:
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| Section 5. The Public Utilities Act is amended by changing | 5 |
| Sections 16-101A, 16-102, and 16-107 as follows:
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| (220 ILCS 5/16-101A)
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| Sec. 16-101A. Legislative findings.
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| (a) The citizens and businesses of the State of Illinois
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| have been well-served by a comprehensive electrical utility
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| system which has provided safe, reliable, and affordable
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| service. The electrical utility system in the State of
Illinois | 12 |
| has historically been subject to State and federal
regulation, | 13 |
| aimed at assuring the citizens and businesses of
the State of | 14 |
| safe, reliable, and affordable service, while at
the same time | 15 |
| assuring the utility system of a return on its
investment.
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| (b) Competitive forces are affecting the market for
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| electricity as a result of recent federal regulatory and
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| statutory changes and the activities of other states.
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| Competition in the electric services market may create
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| opportunities for new products and services for customers and
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| lower costs for users of electricity. Long-standing regulatory
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| relationships need to be altered to accommodate the
competition | 23 |
| that could fundamentally alter the structure of
the electric | 24 |
| services market.
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| (c) With the advent of increasing competition in this
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| industry, the State has a continued interest in assuring that
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| the safety, reliability, and affordability of electrical power
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| is not sacrificed to competitive pressures, and to that end,
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| intends to implement safeguards to assure that the industry
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| continues to operate the electrical system in a manner that
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| will serve the public's interest. Under the existing
regulatory | 32 |
| framework, the industry has been encouraged to
undertake |
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| certain investments in its physical plant and
personnel to | 2 |
| enhance its efficient operation, the cost of
which it has been | 3 |
| permitted to pass on to consumers. The
State has an interest in | 4 |
| providing the existing utilities a
reasonable opportunity to | 5 |
| obtain a return on certain
investments on which they depended | 6 |
| in undertaking those
commitments in the first instance while, | 7 |
| at the same time, not
permitting new entrants into the industry | 8 |
| to take unreasonable
advantage of the investments made by the | 9 |
| formerly regulated
industry.
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| (d) A competitive wholesale and retail market must
benefit | 11 |
| all Illinois citizens. The Illinois Commerce
Commission should | 12 |
| act to promote the development of an
effectively competitive | 13 |
| electricity market that operates
efficiently and is equitable | 14 |
| to all consumers. Consumer
protections must be in place to | 15 |
| ensure that all customers
continue to receive safe, reliable, | 16 |
| affordable, and
environmentally safe electric service.
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| (e) All consumers must benefit in an equitable and timely
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| fashion from the lower costs for electricity that result from
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| retail and wholesale competition and receive sufficient
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| information to make informed choices among suppliers and
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| services. The use of renewable resources and energy efficiency
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| resources should be encouraged in competitive markets.
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| (f) The efficiency of electric markets depends both upon | 24 |
| the competitiveness of supply and upon the | 25 |
| price-responsiveness of the demand for service. Therefore, to | 26 |
| ensure the lowest total cost of service and to enhance the | 27 |
| reliability of service, all classes of the electricity | 28 |
| customers of electric utilities should have access to and be | 29 |
| able to voluntarily use real-time pricing and other | 30 |
| price-response and demand-response mechanisms.
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| (Source: P.A. 90-561, eff. 12-16-97.)
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| (220 ILCS 5/16-102)
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| Sec. 16-102. Definitions. For the purposes of this
Article | 34 |
| the following terms shall be defined as set forth in
this | 35 |
| Section.
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| "Alternative retail electric supplier" means every
person, | 2 |
| cooperative, corporation, municipal corporation,
company, | 3 |
| association, joint stock company or association,
firm, | 4 |
| partnership, individual, or other entity, their lessees,
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| trustees, or receivers appointed by any court whatsoever, that
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| offers electric power or energy for sale, lease or in exchange
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| for other value received to one or more retail customers, or
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| that engages in the delivery or furnishing of electric power
or | 9 |
| energy to such retail customers, and shall include, without
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| limitation, resellers, aggregators and power marketers, but
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| shall not include (i) electric utilities (or any agent of the
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| electric utility to the extent the electric utility provides
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| tariffed services to retail customers through that agent),
(ii) | 14 |
| any electric cooperative or municipal system as defined
in | 15 |
| Section 17-100 to the extent that the electric cooperative
or | 16 |
| municipal system is serving retail customers within any
area in | 17 |
| which it is or would be entitled to provide service
under the | 18 |
| law in effect immediately prior to the effective
date of this | 19 |
| amendatory Act of 1997, (iii) a public utility
that is owned | 20 |
| and operated by any public institution of higher
education of | 21 |
| this State, or a public utility that is owned by
such public | 22 |
| institution of higher education and operated by
any of its | 23 |
| lessees or operating agents, within any area in
which it is or | 24 |
| would be entitled to provide service under the
law in effect | 25 |
| immediately prior to the effective date of this
amendatory Act | 26 |
| of 1997, (iv) a retail customer to the extent
that customer | 27 |
| obtains its electric power and energy from that customer's
own | 28 |
| cogeneration or self-generation facilities, (v) an
entity that | 29 |
| owns, operates, sells, or arranges for the installation of
a | 30 |
| customer's own cogeneration or self-generation facilities, but | 31 |
| only to
the extent the entity is engaged in
owning,
selling or | 32 |
| arranging for the installation of such facility,
or operating | 33 |
| the facility
on behalf of such customer, provided however that | 34 |
| any such
third party owner or operator of a facility built | 35 |
| after
January 1, 1999, complies with the labor provisions of | 36 |
| Section 16-128(a) as
though
such third party were an |
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| alternative retail
electric supplier,
or (vi) an industrial or
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| manufacturing customer that owns
its own
distribution | 3 |
| facilities, to the extent that the customer provides service | 4 |
| from
that distribution system to a third-party contractor | 5 |
| located on the customer's
premises that is integrally and | 6 |
| predominantly engaged in the customer's
industrial or
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| manufacturing process; provided, that if the industrial or | 8 |
| manufacturing
customer has elected delivery services, the | 9 |
| customer shall pay transition
charges applicable to the | 10 |
| electric power and energy consumed by the third-party
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| contractor unless such charges are otherwise paid by the third | 12 |
| party
contractor, which shall be calculated based on the usage | 13 |
| of, and the base rates
or the contract rates applicable to, the | 14 |
| third-party contractor in accordance
with Section 16-102.
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| "Base rates" means the rates for those tariffed services | 16 |
| that the electric
utility is required to offer pursuant to | 17 |
| subsection (a) of Section 16-103 and
that were identified in a | 18 |
| rate order for collection of the electric
utility's base rate | 19 |
| revenue requirement, excluding (i) separate automatic
rate | 20 |
| adjustment riders then in effect, (ii) special or negotiated | 21 |
| contract
rates, (iii) delivery services tariffs filed pursuant | 22 |
| to Section 16-108, (iv)
real-time pricing, or (v) tariffs that | 23 |
| were in effect prior to October 1, 1996
and that based charges | 24 |
| for services on an index or average of other utilities'
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| charges, but including (vi) any subsequent redesign of such | 26 |
| rates for
tariffed
services that is authorized by the | 27 |
| Commission after notice and hearing.
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| "Competitive service" includes (i) any service that
has | 29 |
| been declared to be competitive pursuant to Section
16-113 of | 30 |
| this Act, (ii) contract service, and (iii) services,
other than | 31 |
| tariffed services, that are related to, but not
necessary for, | 32 |
| the provision of electric power and energy or delivery | 33 |
| services.
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| "Contract service" means (1) services, including the
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| provision of electric power and energy or other services, that
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| are provided by mutual agreement between an electric utility
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| and a retail customer that is located in the electric
utility's | 2 |
| service area, provided that, delivery services shall
not be a | 3 |
| contract service until such services are declared
competitive | 4 |
| pursuant to Section 16-113; and also means (2) the
provision of | 5 |
| electric power and energy by an electric utility
to retail | 6 |
| customers outside the electric utility's service
area pursuant | 7 |
| to Section 16-116. Provided, however, contract
service does not | 8 |
| include electric utility services provided
pursuant to (i) | 9 |
| contracts that retail customers are required
to execute as a | 10 |
| condition of receiving tariffed services, or
(ii) special or | 11 |
| negotiated rate contracts for electric utility
services that | 12 |
| were entered into between an electric utility
and a retail | 13 |
| customer prior to the effective date of this
amendatory Act of | 14 |
| 1997 and filed with the Commission.
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| "Delivery services" means those services provided by the
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| electric utility that are necessary in order for the
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| transmission and distribution systems to function so that
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| retail customers located in the electric utility's service
area | 19 |
| can receive electric power and energy from suppliers
other than | 20 |
| the electric utility, and shall include, without
limitation, | 21 |
| standard metering and billing services.
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| "Electric utility" means a public utility, as defined in
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| Section 3-105 of this Act, that has a franchise, license,
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| permit or right to furnish or sell electricity to retail
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| customers within a service area.
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| "Mandatory transition period" means the period from the
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| effective date of this amendatory Act of 1997 through January
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| 1, 2007.
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| "Municipal system" shall have the meaning set forth in
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| Section 17-100.
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| "Real-time pricing" means tariffed retail charges for | 32 |
| delivered electric
power and energy that vary on an
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| hour-to-hour and are determined from wholesale market prices | 34 |
| using a methodology approved by the Illinois Commerce | 35 |
| Commission
basis for
nonresidential retail customers and that | 36 |
| vary on a periodic
basis during the day for residential retail |
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| customers .
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| "Retail customer" means a single entity using electric
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| power or energy at a single premises and that (A) either (i)
is | 4 |
| receiving or is eligible to receive tariffed services from
an | 5 |
| electric utility, or (ii) that is served by a municipal system | 6 |
| or electric
cooperative within any area in which the
municipal | 7 |
| system or electric cooperative is or would be
entitled to | 8 |
| provide service under the law in effect
immediately prior to | 9 |
| the effective date of this amendatory Act
of 1997, or (B) an | 10 |
| entity which on the effective date of this
Act was receiving | 11 |
| electric service from a public utility and
(i) was engaged in | 12 |
| the practice of resale and redistribution
of such electricity | 13 |
| within a building prior to January 2,
1957, or (ii) was | 14 |
| providing lighting services to tenants in a
multi-occupancy | 15 |
| building, but only to the extent such resale,
redistribution or | 16 |
| lighting service is authorized by the
electric utility's | 17 |
| tariffs that were on file with the
Commission on the effective | 18 |
| date of this Act.
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| "Service area" means (i) the geographic area within which
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| an electric utility was lawfully entitled to provide electric
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| power and energy to retail customers as of the effective date
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| of this amendatory Act of 1997, and includes (ii) the location
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| of any retail customer to which the electric utility was
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| lawfully providing electric utility services on such effective
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| date.
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| "Small commercial retail customer" means those
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| nonresidential retail customers of an electric utility
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| consuming 15,000 kilowatt-hours or less of electricity
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| annually in its service area.
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| "Tariffed service" means services provided to retail
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| customers by an electric utility as defined by its rates on
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| file with the Commission pursuant to the provisions of Article
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| IX of this Act, but shall not include competitive services.
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| "Transition charge" means a charge expressed in cents
per | 35 |
| kilowatt-hour that is calculated for a customer or class
of | 36 |
| customers as follows for each year in which an electric
utility |
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| is entitled to recover transition charges as provided
in | 2 |
| Section 16-108:
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| (1) the amount of revenue that an electric utility
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| would receive from the retail customer or customers if it
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| were serving such customers' electric power and energy
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| requirements as a tariffed service based on (A) all of
the | 7 |
| customers' actual usage during the 3 years
ending 90 days | 8 |
| prior to the date on which such customers
were first | 9 |
| eligible for delivery services pursuant to
Section 16-104, | 10 |
| and (B) on (i) the base rates in effect
on October 1, 1996 | 11 |
| (adjusted for the reductions required
by subsection (b) of | 12 |
| Section 16-111, for any reduction resulting from a rate
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| decrease under Section 16-101(b), for any restatement of | 14 |
| base rates made in
conjunction with an elimination
of the | 15 |
| fuel adjustment clause pursuant to subsection (b), (d), or | 16 |
| (f) of
Section
9-220
and for any removal of decommissioning | 17 |
| costs from base
rates pursuant to Section 16-114)
and any | 18 |
| separate automatic rate adjustment riders (other
than a | 19 |
| decommissioning rate as defined in Section 16-114)
under | 20 |
| which the customers were receiving or, had they
been | 21 |
| customers, would have received electric power and
energy | 22 |
| from the electric utility during the year
immediately | 23 |
| preceding the date on which such customers
were first | 24 |
| eligible for delivery service pursuant to
Section 16-104, | 25 |
| or (ii) to the extent applicable, any
contract rates, | 26 |
| including contracts or rates for consolidated or
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| aggregated billing, under which such customers were
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| receiving electric power and energy from the electric
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| utility during such year;
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| (2) less the amount of revenue, other than revenue
from | 31 |
| transition charges and decommissioning rates, that the | 32 |
| electric utility
would
receive from such retail customers | 33 |
| for delivery services
provided by the electric utility, | 34 |
| assuming such customers
were taking delivery services for | 35 |
| all of their usage,
based on the delivery services tariffs | 36 |
| in effect during
the year for which the transition charge |
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| is being
calculated and on the usage identified in | 2 |
| paragraph (1);
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| (3) less the market value for the electric power
and | 4 |
| energy that the electric utility would have used to
supply | 5 |
| all of such customers' electric power and energy
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| requirements, as a tariffed service, based on the usage
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| identified in paragraph (1), with such market value
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| determined in accordance with Section 16-112 of this Act;
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| (4) less the following amount which represents the
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| amount to be attributed to new revenue sources and cost
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| reductions by the electric utility through the end of the
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| period for which transition costs are recovered pursuant
to | 13 |
| Section 16-108, referred to in this Article XVI as a | 14 |
| "mitigation factor":
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| (A) for nonresidential retail customers, an amount | 16 |
| equal to the greater
of (i) 0.5 cents per kilowatt-hour | 17 |
| during the period October 1, 1999
through December 31, | 18 |
| 2004, 0.6 cents per kilowatt-hour in calendar year | 19 |
| 2005,
and 0.9 cents per kilowatt-hour in calendar year | 20 |
| 2006, multiplied in
each year by the usage identified | 21 |
| in paragraph (1), or (ii) an amount equal to
the | 22 |
| following percentages of the amount produced by | 23 |
| applying the applicable
base rates (adjusted as | 24 |
| described in subparagraph (1)(B)) or contract rate to
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| the usage identified in paragraph (1): 8% for the | 26 |
| period October 1, 1999
through December 31, 2002, 10% | 27 |
| in calendar years 2003 and 2004, 11% in calendar
year | 28 |
| 2005 and 12% in calendar year 2006;
and
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| (B) for residential retail customers, an amount
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| equal to the following percentages of the amount | 31 |
| produced by applying the
base rates in effect on | 32 |
| October 1, 1996 (adjusted as
described in subparagraph | 33 |
| (1)(B)) to the usage
identified in paragraph (1): (i) | 34 |
| 6% from May 1, 2002 through December 31,
2002, (ii) 7% | 35 |
| in calendar years 2003 and 2004, (iii) 8% in calendar | 36 |
| year
2005, and (iv) 10% in calendar year 2006;
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| (5) divided by the usage of such customers
identified | 2 |
| in paragraph (1),
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| provided that the transition charge shall never be less than
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| zero.
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| "Unbundled service" means a component or constituent part
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| of a tariffed service which the electric utility subsequently
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| offers separately to its customers.
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| (Source: P.A. 91-50, eff. 6-30-99; 92-537, eff. 6-6-02.)
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| (220 ILCS 5/16-107)
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| Sec. 16-107. Real-time pricing.
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| (a) Each electric utility shall file, on or before May 1,
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| 1998, a tariff or tariffs which allow nonresidential retail
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| customers in the electric utility's service area to elect
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| real-time pricing beginning October 1, 1998.
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| (b) Each electric utility shall file, on or before May 1,
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| 2000, a tariff or tariffs which allow residential retail
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| customers in the electric utility's service area to elect
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| real-time pricing beginning October 1, 2000.
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| (b-5) Each electric utility shall file a tariff or tariffs | 20 |
| allowing residential retail customers in the electric | 21 |
| utility's service area to elect real-time pricing beginning | 22 |
| January 2, 2007. A customer who elects real-time pricing shall | 23 |
| remain on such rate for a minimum of 12 months. The Commission | 24 |
| may, after notice and hearing, approve the tariff or tariffs, | 25 |
| provided that the Commission finds that the potential for | 26 |
| demand reductions will result in net economic benefits to all | 27 |
| residential customers of the electric utility. In examining | 28 |
| economic benefits from demand reductions, the Commission | 29 |
| shall, at a minimum, consider the following: improvements to | 30 |
| system reliability and power quality, reduction in wholesale | 31 |
| market prices and price volatility, electric utility cost | 32 |
| avoidance and reductions, market power mitigation, and other | 33 |
| benefits of demand reductions, but only to the extent that the | 34 |
| effects of reduced demand can be demonstrated to lower the cost | 35 |
| of electricity delivered to residential customers. A tariff or |
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| tariffs approved pursuant to this subsection (b-5) shall, at a | 2 |
| minimum, describe (i) the methodology for determining the | 3 |
| market price of energy to be reflected in the real-time rate | 4 |
| and (ii) the manner in which customers who elect real-time | 5 |
| pricing will be provided with ready access to hourly market | 6 |
| prices, including, but not limited to, day-ahead hourly energy | 7 |
| prices. | 8 |
| A proceeding under this subsection (b-5) may not exceed 120 | 9 |
| days in length.
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| (b-10) Each electric utility providing real-time pricing | 11 |
| pursuant to subsection (b-5) shall install a meter capable of | 12 |
| recording hourly interval energy use at the service location of | 13 |
| each customer that elects real-time pricing pursuant to this | 14 |
| subsection. | 15 |
| (b-15) If the Commission issues an order pursuant to | 16 |
| subsection (b-5), the affected electric utility shall contract | 17 |
| with an entity not affiliated with the electric utility to | 18 |
| serve as a program administrator to develop and implement a | 19 |
| program to provide consumer outreach, enrollment, and | 20 |
| education concerning real-time pricing and to establish and | 21 |
| administer an information system and technical and other | 22 |
| customer assistance that is necessary to enable customers to | 23 |
| manage electricity use. The program administrator: (i) shall be | 24 |
| selected and compensated by the electric utility, subject to | 25 |
| Commission approval; (ii) shall have demonstrated technical | 26 |
| and managerial competence in the development and | 27 |
| administration of demand management programs; and (iii) may | 28 |
| develop and implement risk management, energy efficiency, and | 29 |
| other services related to energy use management for which the | 30 |
| program administrator shall be compensated by participants in | 31 |
| the program receiving such services. The electric utility shall | 32 |
| provide the program administrator with all information and | 33 |
| assistance necessary to perform the program administrator's | 34 |
| duties, including, but not limited to, customer, account, and | 35 |
| energy use data. The electric utility shall permit the program | 36 |
| administrator to include inserts in residential customer bills |
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| 2 times per year to assist with customer outreach and | 2 |
| enrollment. | 3 |
| The program administrator shall submit an annual report to | 4 |
| the electric utility no later than April 1 of each year | 5 |
| describing the operation and results of the program, including | 6 |
| information concerning the number and types of customers using | 7 |
| real-time pricing, changes in customers' energy use patterns, | 8 |
| an assessment of the value of the program to both participants | 9 |
| and non-participants, and recommendations concerning | 10 |
| modification of the program and the tariff or tariffs filed | 11 |
| under subsection (b-5). This report shall be filed by the | 12 |
| electric utility with the Commission within 30 days of receipt | 13 |
| and shall be available to the public on the Commission's web | 14 |
| site. | 15 |
| (b-20) The Commission shall monitor the performance of | 16 |
| programs established pursuant to subsection (b-15) and shall | 17 |
| order the termination or modification of a program if it | 18 |
| determines that the program is not, after a reasonable period | 19 |
| of time for development not to exceed 4 years, resulting in net | 20 |
| benefits to the residential customers of the electric utility.
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| (b-25) An electric utility shall be entitled to recover | 22 |
| reasonable costs incurred in complying with this Section, | 23 |
| provided that recovery of the costs is fairly apportioned among | 24 |
| its residential customers as provided in this subsection | 25 |
| (b-25). The electric utility may apportion greater costs on the | 26 |
| residential customers who elect real-time pricing, but may also | 27 |
| impose some of the costs of real-time pricing on customers who | 28 |
| do not elect real-time pricing, provided that the Commission | 29 |
| determines that the cost savings resulting from real-time | 30 |
| pricing will exceed the costs imposed on customers for | 31 |
| maintaining the program.
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| (c) The electric utility's tariff or tariffs filed
pursuant | 33 |
| to this Section shall be subject to Article IX.
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| (d) This Section does not apply to any electric utility | 35 |
| providing service to 100,000 or fewer customers.
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| (Source: P.A. 90-561, eff. 12-16-97.)
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| Section 99. Effective date. This Act takes effect upon | 2 |
| becoming law.
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