State of Illinois
92nd General Assembly
Legislation

   [ Search ]   [ PDF text ]   [ Legislation ]   
[ Home ]   [ Back ]   [ Bottom ]


[ Introduced ][ Engrossed ][ House Amendment 001 ]
[ House Amendment 002 ][ House Amendment 003 ][ House Amendment 004 ]
[ House Amendment 005 ][ Senate Amendment 001 ]


92_SB2081enr

 
SB2081 Enrolled                                LRB9212879JSpc

 1        AN ACT concerning public utilities.

 2        Be it enacted by the People of  the  State  of  Illinois,
 3    represented in the General Assembly:

 4        Section  5.  The  Public  Utilities  Act  is  amended  by
 5    changing  Sections  9-220,  16-102,  and  16-111  and  adding
 6    Section 16-111.3 as follows:

 7        (220 ILCS 5/9-220) (from Ch. 111 2/3, par. 9-220)
 8        Sec. 9-220. Rate changes based on changes in fuel costs.
 9        (a)  Notwithstanding the provisions of Section 9-201, the
10    Commission  may  authorize  the increase or decrease of rates
11    and charges based upon changes in the cost of  fuel  used  in
12    the  generation  or  production of electric power, changes in
13    the cost of purchased  power,  or  changes  in  the  cost  of
14    purchased  gas  through  the  application  of fuel adjustment
15    clauses or purchased gas adjustment clauses.  The  Commission
16    may  also  authorize  the  increase  or decrease of rates and
17    charges based upon expenditures or  revenues  resulting  from
18    the purchase or sale of emission allowances created under the
19    federal  Clean  Air Act Amendments of 1990, through such fuel
20    adjustment clauses, as a cost of fuel.  For the  purposes  of
21    this  paragraph,  cost  of  fuel  used  in  the generation or
22    production of electric power shall include the amount of  any
23    fees paid by the utility for the implementation and operation
24    of  a  process  for  the desulfurization of the flue gas when
25    burning high sulfur coal at any location within the State  of
26    Illinois irrespective of the attainment status designation of
27    such  location; but shall not include transportation costs of
28    coal (i) except to the extent that for contracts entered into
29    on and after the effective date of  this  amendatory  Act  of
30    1997,  the  cost of the coal, including transportation costs,
31    constitutes the lowest cost for adequate  and  reliable  fuel
 
SB2081 Enrolled            -2-                 LRB9212879JSpc
 1    supply   reasonably   available  to  the  public  utility  in
 2    comparison to the cost, including  transportation  costs,  of
 3    other adequate and reliable sources of fuel supply reasonably
 4    available  to the public utility, or (ii) except as otherwise
 5    provided in the next 3 sentences of  this  paragraph.    Such
 6    costs  of  fuel  shall, when requested by a utility or at the
 7    conclusion  of  the  utility's  next  general  electric  rate
 8    proceeding,   whichever   shall    first    occur,    include
 9    transportation  costs  of  coal purchased under existing coal
10    purchase contracts.  For purposes of this paragraph "existing
11    coal purchase contracts" means contracts for the purchase  of
12    coal  in  effect on the effective date of this amendatory Act
13    of 1991, as such contracts may  thereafter  be  amended,  but
14    only  to the extent that any such amendment does not increase
15    the aggregate quantity of coal to  be  purchased  under  such
16    contract.  Nothing herein shall authorize an electric utility
17    to recover through its fuel adjustment clause any amounts  of
18    transportation  costs  of  coal  that  were  included  in the
19    revenue requirement used to set base rates in its most recent
20    general rate proceeding. Cost shall be based  upon  uniformly
21    applied accounting principles. Annually, the Commission shall
22    initiate  public  hearings  to  determine whether the clauses
23    reflect  actual  costs  of  fuel,   gas,   power,   or   coal
24    transportation  purchased to determine whether such purchases
25    were prudent, and to reconcile any amounts collected with the
26    actual costs of fuel,  power,  gas,  or  coal  transportation
27    prudently  purchased.  In each such proceeding, the burden of
28    proof shall be upon the utility to establish the prudence  of
29    its   cost  of  fuel,  power,  gas,  or  coal  transportation
30    purchases and costs. The Commission  shall  issue  its  final
31    order  in each such annual proceeding for an electric utility
32    by December 31 of the year immediately following the year  to
33    which  the proceeding pertains, provided, that the Commission
34    shall issue its final  order  with  respect  to  such  annual
 
SB2081 Enrolled            -3-                 LRB9212879JSpc
 1    proceeding  for  the  years  1996 and earlier by December 31,
 2    1998.
 3        (b)  A public utility providing electric  service,  other
 4    than  a public utility described in subsections (e) or (f) of
 5    this Section, may at any time during the mandatory transition
 6    period file with the Commission proposed tariff  sheets  that
 7    eliminate  the  public  utility's  fuel adjustment clause and
 8    adjust the public utility's base rate tariffs by  the  amount
 9    necessary  for  the  base fuel component of the base rates to
10    recover the public utility's average fuel  and  power  supply
11    costs per kilowatt-hour for the 2 most recent years for which
12    the  Commission has issued final orders in annual proceedings
13    pursuant to subsection (a), where the average fuel and  power
14    supply costs per kilowatt-hour shall be calculated as the sum
15    of  the public utility's prudent and allowable fuel and power
16    supply costs as found by the Commission in the 2  proceedings
17    divided   by   the  public  utility's  actual  jurisdictional
18    kilowatt-hour sales for those 2 years.   Notwithstanding  any
19    contrary  or inconsistent provisions in Section 9-201 of this
20    Act, in subsection (a) of this Section or  in  any  rules  or
21    regulations   promulgated   by  the  Commission  pursuant  to
22    subsection (g) of this Section, the Commission  shall  review
23    and  shall  by  order  approve,  or  approve as modified, the
24    proposed tariff sheets within 60 days after the date  of  the
25    public  utility's  filing.   The  Commission  may  modify the
26    public utility's proposed tariff sheets only  to  the  extent
27    the  Commission finds necessary to achieve conformance to the
28    requirements of this subsection  (b).   During  the  5  years
29    following  the  date  of  the  Commission's order, but in any
30    event no earlier than January 1, 2007 2005, a public  utility
31    whose  fuel adjustment clause has been eliminated pursuant to
32    this  subsection  shall  not  file  proposed  tariff   sheets
33    seeking,   or   otherwise   petition   the   Commission  for,
34    reinstatement of a fuel adjustment clause.
 
SB2081 Enrolled            -4-                 LRB9212879JSpc
 1        (c)  Notwithstanding   any   contrary   or   inconsistent
 2    provisions in Section 9-201 of this Act, in subsection (a) of
 3    this Section or in any rules or  regulations  promulgated  by
 4    the  Commission pursuant to subsection (g) of this Section, a
 5    public utility  providing  electric  service,  other  than  a
 6    public  utility  described  in  subsection (e) or (f) of this
 7    Section, may at any  time  during  the  mandatory  transition
 8    period  file  with the Commission proposed tariff sheets that
 9    establish the rate per kilowatt-hour to be  applied  pursuant
10    to the public utility's fuel adjustment clause at the average
11    value  for such rate during the preceding 24 months, provided
12    that such average rate results  in  a  credit  to  customers'
13    bills,  without  making any revisions to the public utility's
14    base  rate  tariffs.   The  proposed  tariff   sheets   shall
15    establish the fuel adjustment rate for a specific time period
16    of  at least 3 years but not more than 5 years, provided that
17    the terms and conditions for any reinstatement earlier than 5
18    years shall be set forth in the proposed  tariff  sheets  and
19    subject  to  modification or approval by the Commission.  The
20    Commission shall  review  and  shall  by  order  approve  the
21    proposed  tariff  sheets if it finds that the requirements of
22    this subsection are met.  The Commission  shall  not  conduct
23    the  annual  hearings  specified  in  the last 3 sentences of
24    subsection (a) of this Section for the utility for the period
25    that the factor established pursuant to this subsection is in
26    effect.
27        (d)  A public utility providing electric  service,  or  a
28    public  utility  providing  gas  service  may  file  with the
29    Commission proposed tariff sheets that eliminate  the  public
30    utility's  fuel or purchased gas adjustment clause and adjust
31    the  public  utility's  base  rate  tariffs  to  provide  for
32    recovery of power supply costs or gas supply costs that would
33    have been recovered through such clause; provided,  that  the
34    provisions of this subsection (d) shall not be available to a
 
SB2081 Enrolled            -5-                 LRB9212879JSpc
 1    public  utility  described  in subsections (e) or (f) of this
 2    Section   to   eliminate   its   fuel   adjustment    clause.
 3    Notwithstanding  any  contrary  or inconsistent provisions in
 4    Section 9-201 of this Act, in subsection (a) of this Section,
 5    or in any rules or regulations promulgated by the  Commission
 6    pursuant  to  subsection  (g) of this Section, the Commission
 7    shall review and  shall  by  order  approve,  or  approve  as
 8    modified  in  the  Commission's  order,  the  proposed tariff
 9    sheets within 240 days after the date of the public utility's
10    filing.  The  Commission's  order  shall  approve  rates  and
11    charges  that  the  Commission,  based  on information in the
12    public utility's filing or on the record if a hearing is held
13    by the Commission, finds will recover the reasonable, prudent
14    and necessary jurisdictional power supply costs or gas supply
15    costs incurred or to be incurred by the public utility during
16    a 12 month period found by the Commission to  be  appropriate
17    for  these  purposes,  provided,  that  such  period shall be
18    either (i) a 12 month historical period occurring during  the
19    15  months ending on the date of the public utility's filing,
20    or (ii) a 12 month future period  ending  no  later  than  15
21    months  following  the  date  of the public utility's filing.
22    The public utility  shall  include  with  its  tariff  filing
23    information  showing both (1) its actual jurisdictional power
24    supply costs or gas supply costs for a  12  month  historical
25    period   conforming  to  (i)  above  and  (2)  its  projected
26    jurisdictional power supply costs or gas supply costs  for  a
27    future  12  month  period  conforming  to  (ii) above. If the
28    Commission's  order  requires  modifications  in  the  tariff
29    sheets filed by the public utility, the public utility  shall
30    have  7  days  following  the date of the order to notify the
31    Commission whether the  public  utility  will  implement  the
32    modified  tariffs  or elect to continue its fuel or purchased
33    gas adjustment clause in force as though no  order  had  been
34    entered.   The  Commission's  order  shall  provide  for  any
 
SB2081 Enrolled            -6-                 LRB9212879JSpc
 1    reconciliation  of power supply costs or gas supply costs, as
 2    the case may be, and associated  revenues  through  the  date
 3    that  the  public  utility's fuel or purchased gas adjustment
 4    clause is eliminated.  During the 5 years following the  date
 5    of  the  Commission's  order,  a public utility whose fuel or
 6    purchased gas adjustment clause has been eliminated  pursuant
 7    to  this  subsection  shall  not  file proposed tariff sheets
 8    seeking,  or   otherwise   petition   the   Commission   for,
 9    reinstatement   or  adoption  of  a  fuel  or  purchased  gas
10    adjustment clause. Nothing in this subsection  (d)  shall  be
11    construed as limiting the Commission's authority to eliminate
12    a  public  utility's  fuel adjustment clause or purchased gas
13    adjustment clause in accordance  with  any  other  applicable
14    provisions of this Act.
15        (e)  Notwithstanding   any   contrary   or   inconsistent
16    provisions  in   Section 9-201 of this Act, in subsection (a)
17    of this  Section,  or  in    any  rules  promulgated  by  the
18    Commission  pursuant    to  subsection (g) of this Section, a
19    public utility providing    electric  service  to  more  than
20    1,000,000  customers  in  this  State may, within the first 6
21    months after the  effective date of this  amendatory  Act  of
22    1997,  file  with the  Commission proposed tariff sheets that
23    eliminate, effective  January 1, 1997, the  public  utility's
24    fuel adjustment clause  without adjusting its base rates, and
25    such  tariff  sheets shall be  effective upon filing.  To the
26    extent the application of the fuel    adjustment  clause  had
27    resulted  in net charges to customers after  January 1, 1997,
28    the utility shall also file a tariff sheet that  provides for
29    a refund stated on a per kilowatt-hour basis of such  charges
30    over a period not to exceed 6 months; provided  however, that
31    such refund shall not include the proportional    amounts  of
32    taxes  paid  under  the  Use  Tax  Act,  Service Use Tax Act,
33    Service Occupation Tax Act, and Retailers' Occupation Tax Act
34    on  fuel used in generation.  The Commission shall  issue  an
 
SB2081 Enrolled            -7-                 LRB9212879JSpc
 1    order   within 45 days after the date of the public utility's
 2    filing  approving or approving as modified such tariff sheet.
 3    If the fuel  adjustment clause is eliminated pursuant to this
 4    subsection, the  Commission  shall  not  conduct  the  annual
 5    hearings specified in the  last 3 sentences of subsection (a)
 6    of  this  Section  for  the    utility  for  any period after
 7    December 31, 1996 and prior to any    reinstatement  of  such
 8    clause.  A  public  utility whose fuel  adjustment clause has
 9    been eliminated pursuant to this subsection  shall not file a
10    proposed tariff sheet seeking, or  otherwise    petition  the
11    Commission  for, reinstatement of the fuel adjustment  clause
12    prior to January 1, 2007 2005.
13        (f)  Notwithstanding   any   contrary   or   inconsistent
14    provisions in Section 9-201 of this Act, in subsection (a) of
15    this Section, or in any rules or regulations  promulgated  by
16    the  Commission pursuant to subsection (g) of this Section, a
17    public  utility  providing  electric  service  to  more  than
18    500,000 customers but fewer than 1,000,000 customers in  this
19    State may, within the first 6 months after the effective date
20    of  this  amendatory  Act  of  1997, file with the Commission
21    proposed tariff sheets that eliminate, effective  January  1,
22    1997,  the public utility's fuel adjustment clause and adjust
23    its base rates by the amount  necessary  for  the  base  fuel
24    component  of  the  base  rates  to recover 91% of the public
25    utility's average fuel and power supply costs for the 2  most
26    recent years for which the Commission, as of January 1, 1997,
27    has  issued  final  orders  in annual proceedings pursuant to
28    subsection (a), where the average fuel and power supply costs
29    per kilowatt-hour shall be  calculated  as  the  sum  of  the
30    public  utility's prudent and allowable fuel and power supply
31    costs as found by the Commission in the 2 proceedings divided
32    by the public utility's actual  jurisdictional  kilowatt-hour
33    sales  for  those  2 years, provided, that such tariff sheets
34    shall  be  effective  upon  filing.   To   the   extent   the
 
SB2081 Enrolled            -8-                 LRB9212879JSpc
 1    application of the fuel adjustment clause had resulted in net
 2    charges to customers after January 1, 1997, the utility shall
 3    also file a tariff sheet that provides for a refund stated on
 4    a  per  kilowatt-hour basis of such charges over a period not
 5    to exceed 6 months.  Provided however, that such refund shall
 6    not include the proportional amounts of taxes paid under  the
 7    Use Tax Act, Service Use Tax Act, Service Occupation Tax Act,
 8    and Retailers' Occupation Tax Act on fuel used in generation.
 9    The  Commission shall issue an order within 45 days after the
10    date of the public utility's filing approving or approving as
11    modified such tariff sheet.  If the fuel adjustment clause is
12    eliminated pursuant to this subsection, the Commission  shall
13    not  conduct  the  annual  hearings  specified  in the last 3
14    sentences of subsection (a) of this Section for  the  utility
15    for  any  period  after  December  31,  1996 and prior to any
16    reinstatement of such clause.  A public  utility  whose  fuel
17    adjustment  clause  has  been  eliminated  pursuant  to  this
18    subsection shall not file a proposed tariff sheet seeking, or
19    otherwise  petition  the Commission for, reinstatement of the
20    fuel adjustment clause prior to January 1, 2007 2005.
21        (g)  The Commission shall have  authority  to  promulgate
22    rules  and  regulations  to  carry out the provisions of this
23    Section.
24    (Source: P.A. 90-561, eff. 12-16-97.)

25        (220 ILCS 5/16-102)
26        Sec. 16-102.  Definitions.   For  the  purposes  of  this
27    Article  the following terms shall be defined as set forth in
28    this Section.
29        "Alternative  retail  electric  supplier"   means   every
30    person,   cooperative,  corporation,  municipal  corporation,
31    company, association, joint  stock  company  or  association,
32    firm,   partnership,   individual,  or  other  entity,  their
33    lessees,  trustees,  or  receivers  appointed  by  any  court
 
SB2081 Enrolled            -9-                 LRB9212879JSpc
 1    whatsoever, that offers electric power or  energy  for  sale,
 2    lease  or in exchange for other value received to one or more
 3    retail  customers,  or  that  engages  in  the  delivery   or
 4    furnishing  of  electric  power  or  energy  to  such  retail
 5    customers,  and shall include, without limitation, resellers,
 6    aggregators and power marketers, but shall  not  include  (i)
 7    electric  utilities  (or any agent of the electric utility to
 8    the extent the electric utility provides tariffed services to
 9    retail customers  through  that  agent),  (ii)  any  electric
10    cooperative  or municipal system as defined in Section 17-100
11    to the extent that  the  electric  cooperative  or  municipal
12    system  is  serving retail customers within any area in which
13    it is or would be entitled to provide service under  the  law
14    in  effect  immediately  prior  to the effective date of this
15    amendatory Act of 1997, (iii) a public utility that is  owned
16    and operated by any public institution of higher education of
17    this  State, or a public utility that is owned by such public
18    institution of higher education and operated by  any  of  its
19    lessees  or  operating agents, within any area in which it is
20    or would be entitled to provide  service  under  the  law  in
21    effect  immediately  prior  to  the  effective  date  of this
22    amendatory Act of 1997, (iv) a retail customer to the  extent
23    that customer obtains its electric power and energy from that
24    customer's  own  cogeneration  or self-generation facilities,
25    (v) an entity that owns, operates, sells, or arranges for the
26    installation   of   a   customer's   own   cogeneration    or
27    self-generation facilities, but only to the extent the entity
28    is   engaged   in   owning,  selling  or  arranging  for  the
29    installation of such facility,  or operating the facility  on
30    behalf of such customer, provided however that any such third
31    party  owner or operator of a facility built after January 1,
32    1999, complies with the labor provisions of Section 16-128(a)
33    as  though  such  third  party  were  an  alternative  retail
34    electric supplier, or (vi)  an  industrial  or  manufacturing
 
SB2081 Enrolled            -10-                LRB9212879JSpc
 1    customer  that  owns  its own distribution facilities, to the
 2    extent  that  the  customer  provides   service   from   that
 3    distribution  system  to  a third-party contractor located on
 4    the customer's premises that is integrally and  predominantly
 5    engaged   in   the  customer's  industrial  or  manufacturing
 6    process; provided, that if the  industrial  or  manufacturing
 7    customer  has  elected  delivery services, the customer shall
 8    pay transition charges applicable to the electric  power  and
 9    energy  consumed  by  the  third-party contractor unless such
10    charges are otherwise paid by  the  third  party  contractor,
11    which shall be calculated based on the usage of, and the base
12    rates  or  the  contract rates applicable to, the third-party
13    contractor in accordance with Section 16-102.
14        "Base rates" means the rates for those tariffed  services
15    that  the  electric  utility is required to offer pursuant to
16    subsection (a) of Section 16-103 and that were identified  in
17    a  rate  order  for collection of the electric utility's base
18    rate revenue requirement, excluding  (i)  separate  automatic
19    rate  adjustment  riders  then  in  effect,  (ii)  special or
20    negotiated contract rates, (iii)  delivery  services  tariffs
21    filed  pursuant to Section 16-108, (iv) real-time pricing, or
22    (v) tariffs that were in effect prior to October 1, 1996  and
23    that  based  charges  for  services on an index or average of
24    other utilities' charges, but including (vi)  any  subsequent
25    redesign   of  such  rates  for  tariffed  services  that  is
26    authorized by the Commission after notice and hearing.
27        "Competitive service" includes (i) any service  that  has
28    been declared to be competitive pursuant to Section 16-113 of
29    this  Act,  (ii)  contract service, and (iii) services, other
30    than  tariffed  services,  that  are  related  to,  but   not
31    necessary  for, the provision of electric power and energy or
32    delivery services.
33        "Contract service"  means  (1)  services,  including  the
34    provision  of  electric  power  and energy or other services,
 
SB2081 Enrolled            -11-                LRB9212879JSpc
 1    that are provided by mutual  agreement  between  an  electric
 2    utility and a retail customer that is located in the electric
 3    utility's  service  area,  provided  that,  delivery services
 4    shall not be a  contract  service  until  such  services  are
 5    declared  competitive  pursuant  to  Section 16-113; and also
 6    means (2) the provision of electric power and  energy  by  an
 7    electric  utility  to  retail  customers outside the electric
 8    utility's service area pursuant to Section 16-116.  Provided,
 9    however, contract service does not include  electric  utility
10    services  provided  pursuant  to  (i)  contracts  that retail
11    customers are required to execute as a condition of receiving
12    tariffed  services,  or  (ii)  special  or  negotiated   rate
13    contracts  for  electric  utility  services that were entered
14    into between an electric utility and a retail customer  prior
15    to  the  effective  date  of  this amendatory Act of 1997 and
16    filed with the Commission.
17        "Delivery services" means those services provided by  the
18    electric   utility  that  are  necessary  in  order  for  the
19    transmission and distribution systems  to  function  so  that
20    retail  customers  located  in the electric utility's service
21    area can receive electric power  and  energy  from  suppliers
22    other  than  the electric utility, and shall include, without
23    limitation, standard metering and billing services.
24        "Electric utility" means a public utility, as defined  in
25    Section  3-105  of  this  Act, that has a franchise, license,
26    permit or right to furnish  or  sell  electricity  to  retail
27    customers within a service area.
28        "Mandatory  transition  period" means the period from the
29    effective date of this amendatory Act of 1997 through January
30    1, 2007 2005.
31        "Municipal system" shall have the meaning  set  forth  in
32    Section 17-100.
33        "Real-time  pricing" means charges for delivered electric
34    power and energy that  vary  on  an  hour-to-hour  basis  for
 
SB2081 Enrolled            -12-                LRB9212879JSpc
 1    nonresidential  retail  customers and that vary on a periodic
 2    basis during the day for residential retail customers.
 3        "Retail customer" means a single  entity  using  electric
 4    power  or energy at a single premises and that (A) either (i)
 5    is receiving or is eligible to receive tariffed services from
 6    an electric utility,  or (ii) that is served by  a  municipal
 7    system  or  electric cooperative within any area in which the
 8    municipal system or  electric  cooperative  is  or  would  be
 9    entitled   to   provide  service  under  the  law  in  effect
10    immediately prior to the effective date  of  this  amendatory
11    Act  of 1997, or (B) an entity which on the effective date of
12    this Act was receiving electric service from a public utility
13    and  (i)  was  engaged  in  the   practice  of   resale   and
14    redistribution of such electricity within a building prior to
15    January  2,  1957, or (ii) was providing lighting services to
16    tenants in a multi-occupancy building, but only to the extent
17    such resale, redistribution or lighting service is authorized
18    by the electric utility's tariffs that were on file with  the
19    Commission on the effective date of this Act.
20        "Service area" means (i) the geographic area within which
21    an electric utility was lawfully entitled to provide electric
22    power and energy to retail customers as of the effective date
23    of  this  amendatory  Act  of  1997,  and  includes  (ii) the
24    location of any retail customer to which the electric utility
25    was lawfully providing  electric  utility  services  on  such
26    effective date.
27        "Small    commercial   retail   customer"   means   those
28    nonresidential  retail  customers  of  an  electric   utility
29    consuming   15,000  kilowatt-hours  or  less  of  electricity
30    annually in its service area.
31        "Tariffed service"  means  services  provided  to  retail
32    customers  by  an electric utility as defined by its rates on
33    file with  the  Commission  pursuant  to  the  provisions  of
34    Article  IX  of  this  Act, but shall not include competitive
 
SB2081 Enrolled            -13-                LRB9212879JSpc
 1    services.
 2        "Transition charge" means a charge expressed in cents per
 3    kilowatt-hour that is calculated for a customer or  class  of
 4    customers  as  follows  for  each  year  in which an electric
 5    utility is entitled to recover transition charges as provided
 6    in Section 16-108:
 7             (1)  the amount of revenue that an electric  utility
 8        would receive from the retail customer or customers if it
 9        were  serving  such  customers' electric power and energy
10        requirements as a tariffed service based on  (A)  all  of
11        the  customers' actual usage during the 3 years ending 90
12        days prior to the date on which such customers were first
13        eligible  for  delivery  services  pursuant  to   Section
14        16-104,  and  (B)  on  (i)  the  base  rates in effect on
15        October 1, 1996 (adjusted for the reductions required  by
16        subsection  (b)  of  Section  16-111,  for  any reduction
17        resulting from a rate decrease under  Section  16-101(b),
18        for  any  restatement  of  base rates made in conjunction
19        with  an  elimination  of  the  fuel  adjustment   clause
20        pursuant  to subsection (b), (d), or (f) of Section 9-220
21        and for any removal of decommissioning  costs  from  base
22        rates  pursuant  to  Section  16-114)  and  any  separate
23        automatic   rate   adjustment   riders   (other   than  a
24        decommissioning rate as defined in Section 16-114)  under
25        which  the  customers  were  receiving  or, had they been
26        customers, would have received electric power and  energy
27        from  the  electric  utility  during the year immediately
28        preceding the date on which  such  customers  were  first
29        eligible for delivery service pursuant to Section 16-104,
30        or  (ii)  to  the  extent applicable, any contract rates,
31        including  contracts  or  rates   for   consolidated   or
32        aggregated  billing,  under  which  such  customers  were
33        receiving  electric  power  and  energy from the electric
34        utility during such year;
 
SB2081 Enrolled            -14-                LRB9212879JSpc
 1             (2)  less the amount of revenue, other than  revenue
 2        from  transition  charges and decommissioning rates, that
 3        the electric  utility  would  receive  from  such  retail
 4        customers  for delivery services provided by the electric
 5        utility, assuming such  customers  were  taking  delivery
 6        services  for  all  of their usage, based on the delivery
 7        services tariffs in effect during the year for which  the
 8        transition  charge  is  being calculated and on the usage
 9        identified in paragraph (1);
10             (3)  less the market value for  the  electric  power
11        and  energy  that the electric utility would have used to
12        supply all of such customers' electric power  and  energy
13        requirements,  as  a tariffed service, based on the usage
14        identified in  paragraph  (1),  with  such  market  value
15        determined in accordance with Section 16-112 of this Act;
16             (4)  less  the following amount which represents the
17        amount to be attributed to new revenue sources  and  cost
18        reductions by the electric utility through the end of the
19        period  for which transition costs are recovered pursuant
20        to Section 16-108, referred to in this Article XVI  as  a
21        "mitigation factor":
22                  (A)  for  nonresidential  retail  customers, an
23             amount equal to the greater of  (i)  0.5  cents  per
24             kilowatt-hour  during  the  period  October  1, 1999
25             through   December   31,   2004,   0.6   cents   per
26             kilowatt-hour in calendar year 2005, and  0.9  cents
27             per  kilowatt-hour in calendar year 2006, multiplied
28             in each year by the usage  identified  in  paragraph
29             (1),  or  (ii)  an  amount  equal  to  the following
30             percentages of the amount produced by  applying  the
31             applicable  base  rates  (adjusted  as  described in
32             subparagraph (1)(B)) or contract rate to  the  usage
33             identified  in  paragraph  (1):  8%  for  the period
34             October 1, 1999 through December 31,  2002,  10%  in
 
SB2081 Enrolled            -15-                LRB9212879JSpc
 1             calendar  years  2003 and 2004, 11% in calendar year
 2             2005 and 12% in calendar year 2006; and
 3                  (B)  for  residential  retail   customers,   an
 4             amount  equal  to  the  following percentages of the
 5             amount produced by applying the base rates in effect
 6             on  October  1,  1996  (adjusted  as  described   in
 7             subparagraph  (1)(B))  to  the  usage  identified in
 8             paragraph (1): (i)  6%  from  May  1,  2002  through
 9             December  31,  2002,  (ii) 7% in calendar years 2003
10             and 2004, (iii) 8% in calendar year 2005,  and  (iv)
11             10% in calendar year 2006;
12             (5)  divided   by   the   usage  of  such  customers
13        identified in paragraph (1),
14    provided that the transition charge shall never be less  than
15    zero.
16        "Unbundled service" means a component or constituent part
17    of a tariffed service which the electric utility subsequently
18    offers separately to its customers.
19    (Source: P.A. 90-561, eff. 12-16-97; 91-50, eff. 6-30-99.)

20        (220 ILCS 5/16-111)
21        Sec.  16-111. Rates and restructuring transactions during
22    mandatory transition period.
23        (a)  During    the    mandatory    transition     period,
24    notwithstanding  any provision of Article IX of this Act, and
25    except as provided in subsections (b), (d), (e), and  (f)  of
26    this   Section,   the  Commission  shall  not  (i)  initiate,
27    authorize or order any change by way of increase (other  than
28    in  connection  with  a  request  for rate increase which was
29    filed after September 1, 1997 but prior to October 15,  1997,
30    by  an electric utility serving less than 12,500 customers in
31    this State),  (ii)  initiate  or,  unless  requested  by  the
32    electric  utility,  authorize  or  order any change by way of
33    decrease, restructuring or unbundling (except as provided  in
 
SB2081 Enrolled            -16-                LRB9212879JSpc
 1    Section  16-109A),  in the rates of any electric utility that
 2    were in effect on October 1, 1996,  or  (iii)  in  any  order
 3    approving  any  application  for a merger pursuant to Section
 4    7-204 that was  pending  as  of  May  16,  1997,  impose  any
 5    condition  requiring any filing for an increase, decrease, or
 6    change in, or other review of, an electric utility's rates or
 7    enforce any such  condition  of  any  such  order;  provided,
 8    however,   that   this  subsection  shall  not  prohibit  the
 9    Commission from:
10             (1)  approving  the  application  of   an   electric
11        utility  to  implement  an  alternative to rate of return
12        regulation or a  regulatory  mechanism  that  rewards  or
13        penalizes  the  electric  utility  through  adjustment of
14        rates based on utility performance, pursuant  to  Section
15        9-244;
16             (2)  authorizing  an  electric  utility to eliminate
17        its fuel adjustment  clause  and  adjust  its  base  rate
18        tariffs in accordance with subsection (b), (d), or (f) of
19        Section  9-220  of  this  Act, to fix its fuel adjustment
20        factor in accordance with subsection (c) of Section 9-220
21        of this Act, or to eliminate its fuel  adjustment  clause
22        in  accordance  with  subsection  (e) of Section 9-220 of
23        this Act;
24             (3)  ordering  into  effect  tariffs  for   delivery
25        services   and  transition  charges  in  accordance  with
26        Sections 16-104 and  16-108,  for  real-time  pricing  in
27        accordance  with  Section 16-107, or the options required
28        by Section 16-110 and subsection  (n) of 16-112, allowing
29        a billing experiment in accordance with  Section  16-106,
30        or modifying delivery services tariffs in accordance with
31        Section 16-109; or
32             (4)  ordering  or allowing into effect any tariff to
33        recover charges pursuant to  Sections  9-201.5,  9-220.1,
34        9-221,  9-222  (except  as  provided in Section 9-222.1),
 
SB2081 Enrolled            -17-                LRB9212879JSpc
 1        16-108, and 16-114  of  this  Act,  Section  5-5  of  the
 2        Electricity  Infrastructure  Maintenance Fee Law, Section
 3        6-5 of the Renewable Energy, Energy Efficiency, and  Coal
 4        Resources  Development Law of 1997, and Section 13 of the
 5        Energy Assistance Act of 1989.
 6        After  December  31,  2004,  the   provisions   of   this
 7    subsection  (a)  shall not apply to an electric utility whose
 8    average residential retail rate was less than or equal to 90%
 9    of the average  residential  retail  rate  for  the  "Midwest
10    Utilities", as that term is defined in subsection (b) of this
11    Section,  based  on  data  reported  on Form 1 to the Federal
12    Energy Regulatory Commission  for  calendar  year  1995,  and
13    which  served between 150,000 and 250,000 retail customers in
14    this State on January 1, 1995 unless the electric utility  or
15    its  holding  company  has been acquired by or merged with an
16    affiliate of another electric utility subsequent  to  January
17    1,  2002.  This exemption shall be limited to this subsection
18    (a) and shall not extend to any other provisions of this Act.
19        (b)  Notwithstanding the provisions  of  subsection  (a),
20    each  Illinois  electric  utility  serving  more  than 12,500
21    customers  in  Illinois  shall  file  tariffs  (i)  reducing,
22    effective August 1, 1998, each component of its base rates to
23    residential retail customers by 15% from the  base  rates  in
24    effect  immediately  prior to January 1, 1998 and (ii) if the
25    public utility provides electric service  to  (A)  more  than
26    500,000  customers  but less than 1,000,000 customers in this
27    State on January 1, 1999, reducing, effective  May  1,  2002,
28    each  component  of  its  base  rates  to  residential retail
29    customers by an additional 5% from the base rates  in  effect
30    immediately  prior  to  January  1,  1998,  or  (B)  at least
31    1,000,000  customers  in  this  State  on  January  1,  1999,
32    reducing, effective October 1, 2001, each  component  of  its
33    base  rates  to residential retail customers by an additional
34    5% from the base rates in effect immediately prior to January
 
SB2081 Enrolled            -18-                LRB9212879JSpc
 1    1, 1998. Provided, however, that (A) if an electric utility's
 2    average residential retail rate is less than or equal to  the
 3    average  residential  retail  rate  for  a  group  of Midwest
 4    Utilities  (consisting   of   all   investor-owned   electric
 5    utilities   with  annual  system  peaks  in  excess  of  1000
 6    megawatts in the States of Illinois, Indiana, Iowa, Kentucky,
 7    Michigan, Missouri,  Ohio,  and  Wisconsin),  based  on  data
 8    reported   on   Form  1  to  the  Federal  Energy  Regulatory
 9    Commission for calendar year 1995,  then  it  shall  only  be
10    required  to  file  tariffs (i) reducing, effective August 1,
11    1998, each component of its base rates to residential  retail
12    customers  by  5%  from  the base rates in effect immediately
13    prior to January 1, 1998, (ii) reducing, effective October 1,
14    2000, each component of its base rates to residential  retail
15    customers  by  the  lesser  of 5% of the base rates in effect
16    immediately prior to January 1, 1998  or  the  percentage  by
17    which  the electric utility's average residential retail rate
18    exceeds the average residential retail rate  of  the  Midwest
19    Utilities,  based  on  data reported on Form 1 to the Federal
20    Energy Regulatory Commission  for  calendar  year  1999,  and
21    (iii)  reducing, effective October 1, 2002, each component of
22    its  base  rates  to  residential  retail  customers  by   an
23    additional amount equal to the lesser of 5% of the base rates
24    in  effect  immediately  prior  to  January  1,  1998  or the
25    percentage  by   which   the   electric   utility's   average
26    residential  retail  rate  exceeds  the  average  residential
27    retail  rate of the Midwest Utilities, based on data reported
28    on Form 1 to the Federal  Energy  Regulatory  Commission  for
29    calendar year 2001; and (B) if the average residential retail
30    rate  of  an  electric  utility  serving  between 150,000 and
31    250,000 retail customers in this State on January 1, 1995  is
32    less  than  or equal to 90% of the average residential retail
33    rate for the Midwest Utilities, based  on  data  reported  on
34    Form  1  to  the  Federal  Energy  Regulatory  Commission for
 
SB2081 Enrolled            -19-                LRB9212879JSpc
 1    calendar year 1995, then it shall only be  required  to  file
 2    tariffs   (i)   reducing,  effective  August  1,  1998,  each
 3    component of its base rates to residential  retail  customers
 4    by  2%  from  the  base  rates in effect immediately prior to
 5    January 1, 1998; (ii) reducing, effective  October  1,  2000,
 6    each  component  of  its  base  rates  to  residential retail
 7    customers by 2% from the  base  rate  in  effect  immediately
 8    prior  to  January  1,  1998;  and  (iii) reducing, effective
 9    October  1,  2002,  each  component  of  its  base  rates  to
10    residential retail customers by 1% from  the  base  rates  in
11    effect  immediately  prior  to  January  1,  1998.  Provided,
12    further,  that  any  electric utility for which a decrease in
13    base rates has been or is placed into effect between  October
14    1, 1996 and the dates specified in the preceding sentences of
15    this  subsection,  other than pursuant to the requirements of
16    this subsection, shall be entitled to reduce  the  amount  of
17    any  reduction  or  reductions  in its base rates required by
18    this subsection by the amount of  such  other  decrease.  The
19    tariffs required under this subsection shall be filed 45 days
20    in advance of the effective date. Notwithstanding anything to
21    the  contrary in Section 9-220 of this Act, no restatement of
22    base rates in conjunction with  the  elimination  of  a  fuel
23    adjustment clause under that Section shall result in a lesser
24    decrease in base rates than customers would otherwise receive
25    under   this  subsection  had  the  electric  utility's  fuel
26    adjustment clause not been eliminated.
27        (c)  Any utility reducing its base rates by 15% on August
28    1,  1998  pursuant  to  subsection  (b)  shall  include   the
29    following  statement  on  its bills for residential customers
30    from August 1 through December 31, 1998: "Effective August 1,
31    1998, your rates have been reduced by  15%  by  the  Electric
32    Service Customer Choice and Rate Relief Law of 1997 passed by
33    the  Illinois  General  Assembly.".  Any utility reducing its
34    base rates by 5% on August 1, 1998,  pursuant  to  subsection
 
SB2081 Enrolled            -20-                LRB9212879JSpc
 1    (b)  shall  include  the following statement on its bills for
 2    residential customers from  August  1  through  December  31,
 3    1998:   "Effective  August  1,  1998,  your  rates  have been
 4    reduced by 5% by the Electric  Service  Customer  Choice  and
 5    Rate  Relief  Law  of  1997  passed  by  the Illinois General
 6    Assembly.".
 7        Any utility reducing its base rates by 2%  on  August  1,
 8    1998  pursuant  to subsection (b) shall include the following
 9    statement on its bills for residential customers from  August
10    1  through December 31, 1998: "Effective August 1, 1998, your
11    rates have  been  reduced  by  2%  by  the  Electric  Service
12    Customer  Choice  and  Rate  Relief Law of 1997 passed by the
13    Illinois General Assembly.".
14        (d)  During the  mandatory  transition  period,  but  not
15    before  January  1, 2000, and notwithstanding  the provisions
16    of  subsection  (a),  an  electric  utility  may  request  an
17    increase  in  its  base  rates  if   the   electric   utility
18    demonstrates  that  the  2-year average of its earned rate of
19    return  on  common  equity,  calculated  as  its  net  income
20    applicable to common stock divided  by  the  average  of  its
21    beginning  and  ending  balances  of common equity using data
22    reported in the electric  utility's  Form  1  report  to  the
23    Federal  Energy  Regulatory Commission but adjusted to remove
24    the effects of accelerated depreciation  or  amortization  or
25    other  transition  or  mitigation measures implemented by the
26    electric utility pursuant to subsection (g) of  this  Section
27    and  the effect of any refund paid pursuant to subsection (e)
28    of this Section, is below the 2-year average for the  same  2
29    years of the monthly average yields of 30-year  U.S. Treasury
30    bonds  published  by  the  Board of Governors of the  Federal
31    Reserve System in its  weekly  H.15  Statistical  Release  or
32    successor   publication.  The  Commission  shall  review  the
33    electric utility's request, and may review the  justness  and
34    reasonableness   of  all  rates  for  tariffed  services,  in
 
SB2081 Enrolled            -21-                LRB9212879JSpc
 1    accordance with the provisions of Article  IX  of  this  Act,
 2    provided  that  the  Commission shall consider any special or
 3    negotiated adjustments to the revenue requirement  agreed  to
 4    between  the  electric  utility  and the other parties to the
 5    proceeding.   In  setting  rates  under  this  Section,   the
 6    Commission  shall  exclude  the  costs  and revenues that are
 7    associated with  competitive  services  and  any  billing  or
 8    pricing experiments conducted under Section 16-106.
 9        (e)  For   the   purposes  of  this  subsection  (e)  all
10    calculations and  comparisons  shall  be  performed  for  the
11    Illinois operations of multijurisdictional utilities.  During
12    the   mandatory   transition   period,   notwithstanding  the
13    provisions of subsection (a), if the  2-year  average  of  an
14    electric  utility's  earned  rate of return on common equity,
15    calculated as its  net  income  applicable  to  common  stock
16    divided  by  the average of its beginning and ending balances
17    of  common  equity  using  data  reported  in  the   electric
18    utility's  Form  1  report  to  the Federal Energy Regulatory
19    Commission but adjusted to remove the effect  of  any  refund
20    paid  under  this  subsection  (e),  and  further adjusted to
21    include the annual amortization of any difference between the
22    consideration received  by  an  affiliated  interest  of  the
23    electric  utility in the sale of an asset which had been sold
24    or transferred by the  electric  utility  to  the  affiliated
25    interest  subsequent to the effective date of this amendatory
26    Act of 1997 and the consideration for which  such  asset  had
27    been  sold  or  transferred  to the affiliated interest, with
28    such difference to be amortized ratably from the date of  the
29    sale by the affiliated interest to December 31, 2006, exceeds
30    the  2-year  average of the Index for the same 2 years by 1.5
31    or more percentage points, the electric  utility  shall  make
32    refunds to customers beginning the first billing day of April
33    in  the  following  year in the manner described in paragraph
34    (3) of this subsection. For purposes of this subsection  (e),
 
SB2081 Enrolled            -22-                LRB9212879JSpc
 1    the  "Index"  shall  be the sum of (A) the average for the 12
 2    months ended September 30 of the monthly  average  yields  of
 3    30-year  U.S.  Treasury  bonds  published  by  the  Board  of
 4    Governors  of  the  Federal Reserve System in its weekly H.15
 5    Statistical Release or successor publication  for  each  year
 6    1998  through  2006  2004, and (B) (i) 4.00 percentage points
 7    for each of the 12-month periods ending  September  30,  1998
 8    through  September  30, 1999 or 8.00 percentage points if the
 9    electric utility's average residential retail  rate  is  less
10    than  or  equal to 90% of the average residential retail rate
11    for the "Midwest Utilities",  as  that  term  is  defined  in
12    subsection  (b)  of  this  Section, based on data reported on
13    Form 1  to  the  Federal  Energy  Regulatory  Commission  for
14    calendar  year  1995, and the electric utility served between
15    150,000 and 250,000 retail customers on January 1, 1995, (ii)
16    7.00 percentage points  for  each  of  the  12-month  periods
17    ending  September 30, 2000 through September 30, 2006 2004 if
18    the electric  utility  was  providing  service  to  at  least
19    1,000,000 customers in this State on January 1, 1999, or 9.00
20    percentage   points   if   the   electric  utility's  average
21    residential retail rate is less than or equal to 90%  of  the
22    average  residential retail rate for the "Midwest Utilities",
23    as that term is defined in subsection (b)  of  this  Section,
24    based  on  data  reported  on  Form  1  to the Federal Energy
25    Regulatory Commission for calendar year 1995 and the electric
26    utility served between 150,000 and 250,000  retail  customers
27    in  this  State  on  January  1, 1995, (iii) 11.00 percentage
28    points for each of the 12-month periods ending September  30,
29    2000  through  September  30,  2006  2004,  but  only  if the
30    electric utility's average residential retail  rate  is  less
31    than  or  equal to 90% of the average residential retail rate
32    for the "Midwest Utilities",  as  that  term  is  defined  in
33    subsection  (b)  of  this  Section, based on data reported on
34    Form 1  to  the  Federal  Energy  Regulatory  Commission  for
 
SB2081 Enrolled            -23-                LRB9212879JSpc
 1    calendar  year  1995,  the  electric  utility  served between
 2    150,000 and 250,000 retail customers in this State on January
 3    1, 1995, and the electric utility offers delivery services on
 4    or before June 1,  2000  to  retail  customers  whose  annual
 5    electric  energy use comprises 33% of the kilowatt hour sales
 6    to that group of retail customers that are  classified  under
 7    Division  D,  Groups 20 through 39 of the Standard Industrial
 8    Classifications  set  forth  in   the   Standard   Industrial
 9    Classification  Manual  published by the United States Office
10    of Management and Budget, excluding the kilowatt  hour  sales
11    to  those  customers  that are eligible for delivery services
12    pursuant to  Section  16-104(a)(1)(i),  and  offers  delivery
13    services  to  its remaining retail customers classified under
14    Division D, Groups 20 through 39  on  or  before  October  1,
15    2000,  and,  provided  further,  that  the  electric  utility
16    commits  not  to  petition  pursuant to Section 16-108(f) for
17    entry of an order by the Commission authorizing the  electric
18    utility  to  implement  transition  charges for an additional
19    period after December  31,  2006,  or  (iv)  5.00  percentage
20    points  for each of the 12-month periods ending September 30,
21    2000 through September 30, 2006 2004 for all  other  electric
22    utilities  or  7.00  percentage points for such utilities for
23    each of  the  12-month  periods  ending  September  30,  2000
24    through  September  30,  2006  2004 for any such utility that
25    commits not to petition pursuant  to  Section  16-108(f)  for
26    entry  of an order by the Commission authorizing the electric
27    utility to implement transition  charges  for  an  additional
28    period after December 31, 2006 or 11.00 percentage points for
29    each  of  the  12-month periods ending September 30, 2005 and
30    September  30,  2006  for  each  electric  utility  providing
31    service to fewer than 6,500, or between 75,000  and  150,000,
32    electric retail customers in this State on January 1, 1995 if
33    such  utility  commits  not  to  petition pursuant to Section
34    16-108(f) for entry of an order by the Commission authorizing
 
SB2081 Enrolled            -24-                LRB9212879JSpc
 1    the electric utility to implement transition charges  for  an
 2    additional period after December 31, 2006.
 3             (1)  For  purposes  of  this subsection (e), "excess
 4        earnings" means the difference  between  (A)  the  2-year
 5        average  of  the electric utility's earned rate of return
 6        on common equity, less (B) the 2-year average of the  sum
 7        of  (i)  the  Index applicable to each of the 2 years and
 8        (ii)  1.5  percentage  points;  provided,  that   "excess
 9        earnings" shall never be less than zero.
10             (2)  On or before March 31 of each year 2000 through
11        2007  2005 each electric utility shall file a report with
12        the Commission showing  its  earned  rate  of  return  on
13        common   equity,   calculated  in  accordance  with  this
14        subsection, for  the  preceding  calendar  year  and  the
15        average for the preceding 2 calendar years.
16             (3)  If  an  electric  utility  has excess earnings,
17        determined in accordance with paragraphs (1) and  (2)  of
18        this  subsection,  the refunds which the electric utility
19        shall pay  to its customers beginning the  first  billing
20        day  of  April  in the following year shall be calculated
21        and applied as follows:
22                  (i)  The  electric  utility's  excess  earnings
23             shall be multiplied by the average of the  beginning
24             and ending balances of the electric utility's common
25             equity   for  the  2-year  period  in  which  excess
26             earnings occurred.
27                  (ii)  The result  of  the  calculation  in  (i)
28             shall  be  multiplied  by 0.50 and then divided by a
29             number equal  to  1  minus  the  electric  utility's
30             composite federal and State income tax rate.
31                  (iii)  The  result  of  the calculation in (ii)
32             shall  be  divided  by  the  sum  of  the   electric
33             utility's  projected  total  kilowatt-hour  sales to
34             retail customers plus projected kilowatt-hours to be
 
SB2081 Enrolled            -25-                LRB9212879JSpc
 1             delivered to delivery services customers over a  one
 2             year period beginning with the first billing date in
 3             April  in  the  succeeding year to determine a cents
 4             per kilowatt-hour refund factor.
 5                  (iv)  The cents per kilowatt-hour refund factor
 6             calculated  in  (iii)  shall  be  credited  to   the
 7             electric  utility's customers by applying the factor
 8             on   the   customer's   monthly   bills   to    each
 9             kilowatt-hour  sold  or  delivered  until  the total
10             amount  calculated  in  (ii)  has   been   paid   to
11             customers.
12        (f)  During  the mandatory transition period, an electric
13    utility may file revised tariffs reducing the  price  of  any
14    tariffed  service  offered  by  the  electric utility for all
15    customers  taking  that  tariffed  service,  which  shall  be
16    effective 7 days after filing.
17        (g)  During the mandatory transition period, an  electric
18    utility may, without obtaining any approval of the Commission
19    other   than   that  provided  for  in  this  subsection  and
20    notwithstanding any other provision of this Act or  any  rule
21    or  regulation  of  the  Commission  that  would require such
22    approval:
23             (1)  implement a reorganization, other than a merger
24        of 2 or more public utilities as defined in Section 3-105
25        or their holding companies;
26             (2)  retire generating plants from service;
27             (3)  sell,  assign,  lease  or  otherwise   transfer
28        assets  to  an  affiliated  or unaffiliated entity and as
29        part of such transaction enter into  service  agreements,
30        power  purchase  agreements, or other agreements with the
31        transferee; provided, however, that the prices, terms and
32        conditions  of  any  power  purchase  agreement  must  be
33        approved or allowed into effect  by  the  Federal  Energy
34        Regulatory Commission; or
 
SB2081 Enrolled            -26-                LRB9212879JSpc
 1             (4)  use   any   accelerated  cost  recovery  method
 2        including    accelerated    depreciation,     accelerated
 3        amortization or other capital recovery methods, or record
 4        reductions to the original cost of its assets.
 5        In order to implement a reorganization, retire generating
 6    plants  from  service,  or  sell,  assign, lease or otherwise
 7    transfer  assets  pursuant  to  this  Section,  the  electric
 8    utility shall comply with subsections (c) and (d) of  Section
 9    16-128, if applicable, and subsection (k) of this Section, if
10    applicable,  and provide the Commission with at least 30 days
11    notice of the proposed reorganization or  transaction,  which
12    notice shall include the following information:
13                  (i)  a  complete  statement of the entries that
14             the electric utility will  make  on  its  books  and
15             records   of   account  to  implement  the  proposed
16             reorganization  or  transaction  together   with   a
17             certification  from  an independent certified public
18             accountant that such  entries  are  in  accord  with
19             generally accepted accounting principles and, if the
20             Commission  has  previously  approved guidelines for
21             cost  allocations  between  the  utility   and   its
22             affiliates,   a   certification   from   the   chief
23             accounting  officer of the utility that such entries
24             are in accord with those cost allocation guidelines;
25                  (ii)  a description of how the electric utility
26             will use proceeds of any sale, assignment, lease  or
27             transfer  to  retire  debt  or  otherwise  reduce or
28             recover the  costs  of  services  provided  by  such
29             electric utility;
30                  (iii)  a  list  of  all  federal  approvals  or
31             approvals  required from departments and agencies of
32             this State, other  than  the  Commission,  that  the
33             electric   utility   has   or   will  obtain  before
34             implementing the reorganization or transaction;
 
SB2081 Enrolled            -27-                LRB9212879JSpc
 1                  (iv)  an irrevocable commitment by the electric
 2             utility that  it  will  not,  as  a  result  of  the
 3             transaction,  impose  any stranded cost charges that
 4             it might  otherwise  be  allowed  to  charge  retail
 5             customers   under   federal   law  or  increase  the
 6             transition charges that it is otherwise entitled  to
 7             collect under this Article XVI; and
 8                  (v)  if  the electric utility proposes to sell,
 9             assign, lease or  otherwise  transfer  a  generating
10             plant  that  brings  the  amount  of  net dependable
11             generating capacity  transferred  pursuant  to  this
12             subsection to an amount equal to or greater than 15%
13             of the electric utility's net dependable capacity as
14             of  the  effective  date  of  this amendatory Act of
15             1997, and enters into  a  power  purchase  agreement
16             with  the  entity  to which such generating plant is
17             sold, assigned, leased,  or  otherwise  transferred,
18             the  electric  utility  also  agrees,  if   its fuel
19             adjustment clause has not already  been  eliminated,
20             to   eliminate   its   fuel   adjustment  clause  in
21             accordance with subsection (b) of Section 9-220  for
22             a  period  of  time  equal to the length of any such
23             power purchase agreement or successor agreement,  or
24             until  January  1, 2005, whichever is longer; if the
25             capacity of the generating plant so transferred  and
26             related  power purchase agreement does not result in
27             the elimination of the fuel adjustment clause  under
28             this  subsection, and the fuel adjustment clause has
29             not already been eliminated,  the  electric  utility
30             shall  agree  that  the  costs  associated  with the
31             transferred  plant  that   are   included   in   the
32             calculation  of  the  rate  per  kilowatt-hour to be
33             applied pursuant  to  the  electric  utility's  fuel
34             adjustment  clause  during  such  period  shall  not
 
SB2081 Enrolled            -28-                LRB9212879JSpc
 1             exceed  the  per  kilowatt-hour cost associated with
 2             such  generating  plant  included  in  the  electric
 3             utility's fuel adjustment  clause  during  the  full
 4             calendar  year  preceding  the  transfer,  with such
 5             limit to be  adjusted each year  thereafter  by  the
 6             Gross Domestic Product Implicit Price Deflator.
 7                  (vi)  In  addition,  if  the  electric  utility
 8             proposes  to  sell, assign, or lease, (A) either (1)
 9             an amount of generating plant that brings the amount
10             of net dependable  generating  capacity  transferred
11             pursuant to this subsection to an amount equal to or
12             greater  than  15% of its net dependable capacity on
13             the effective date of this amendatory Act  of  1997,
14             or  (2)  one  or more generating plants with a total
15             net dependable capacity of 1100  megawatts,  or  (B)
16             transmission and distribution facilities that either
17             (1)   bring   the   amount   of   transmission   and
18             distribution facilities transferred pursuant to this
19             subsection to an amount equal to or greater than 15%
20             of the electric utility's total depreciated original
21             cost investment in such facilities, or (2) represent
22             an  investment  of  $25,000,000  in  terms  of total
23             depreciated  original  cost,  the  electric  utility
24             shall provide, in addition to the information listed
25             in subparagraphs  (i)  through  (v),  the  following
26             information:  (A)  a description of how the electric
27             utility will meet its service obligations under this
28             Act in a  safe  and  reliable  manner  and  (B)  the
29             electric  utility's  projected earned rate of return
30             on common  equity,  calculated  in  accordance  with
31             subsection  (d)  of this Section, for each year from
32             the date of the notice  through  December  31,  2006
33             2004 both with and without the proposed transaction.
34             If the Commission has not issued an order initiating
 
SB2081 Enrolled            -29-                LRB9212879JSpc
 1             a hearing on the proposed transaction within 30 days
 2             after  the  date  the  electric  utility's notice is
 3             filed, the transaction  shall  be  deemed  approved.
 4             The   Commission  may,  after  notice  and  hearing,
 5             prohibit the proposed transaction if it makes either
 6             or both of the  following  findings:  (1)  that  the
 7             proposed   transaction   will  render  the  electric
 8             utility unable to provide its tariffed services in a
 9             safe and reliable manner, or (2)  that  there  is  a
10             strong  likelihood that consummation of the proposed
11             transaction will  result  in  the  electric  utility
12             being  entitled  to  request an increase in its base
13             rates  during  the   mandatory   transition   period
14             pursuant  to  subsection  (d)  of this Section.  Any
15             hearing  initiated  by  the  Commission   into   the
16             proposed  transaction  shall  be  completed, and the
17             Commission's final order  approving  or  prohibiting
18             the proposed transaction shall be entered, within 90
19             days  after  the  date the electric utility's notice
20             was  filed.  Provided,   however,   that   a   sale,
21             assignment,  or  lease of transmission facilities to
22             an  independent  system  operator  that  meets   the
23             requirements  of Section 16-126 shall not be subject
24             to Commission approval under this Section.
25                  In any proceeding conducted by  the  Commission
26             pursuant  to  this  subparagraph  (vi), intervention
27             shall be limited to parties with a  direct  interest
28             in  the  transaction  which  is  the  subject of the
29             hearing and any statutory consumer protection agency
30             as defined in subsection  (d)  of  Section  9-102.1.
31             Notwithstanding  the provisions of Section 10-113 of
32             this Act, any application seeking  rehearing  of  an
33             order  issued  under this subparagraph (vi), whether
34             filed by the electric utility or by  an  intervening
 
SB2081 Enrolled            -30-                LRB9212879JSpc
 1             party,  shall  be filed within 10 days after service
 2             of the order.
 3        The Commission shall not in any subsequent proceeding  or
 4    otherwise,  review such a reorganization or other transaction
 5    authorized by this Section, but shall retain the authority to
 6    allocate costs as stated in Section 16-111(i). An  entity  to
 7    which an electric utility sells, assigns, leases or transfers
 8    assets pursuant to this subsection (g) shall not, as a result
 9    of  the  transactions  specified  in  this subsection (g), be
10    deemed a public utility as defined in Section 3-105.  Nothing
11    in this subsection (g) shall change any requirement under the
12    jurisdiction of the Illinois  Department  of  Nuclear  Safety
13    including,  but  not limited to, the payment of fees. Nothing
14    in this subsection (g) shall exempt a utility from  obtaining
15    a  certificate  pursuant to Section 8-406 of this Act for the
16    construction of a new electric generating facility.   Nothing
17    in this subsection (g) is intended to exempt the transactions
18    hereunder   from  the  operation  of  the  federal  or  State
19    antitrust laws. Nothing in this subsection (g) shall  require
20    an  electric  utility to use the procedures specified in this
21    subsection for any of the transactions specified herein.  Any
22    other procedure available under this Act may, at the electric
23    utility's election, be used for any such transaction.
24        (h)  During  the   mandatory   transition   period,   the
25    Commission   shall   not   establish  or  use  any  rates  of
26    depreciation, which for purposes  of  this  subsection  shall
27    include  amortization,  for  any  electric utility other than
28    those established pursuant to subsection (c) of Section 5-104
29    of this Act or utilized pursuant to subsection  (g)  of  this
30    Section.  Provided, however, that in any proceeding to review
31    an electric utility's rates for tariffed services pursuant to
32    Section  9-201,  9-202,  9-250  or 16-111(d) of this Act, the
33    Commission may establish new rates of  depreciation  for  the
34    electric  utility  in  the same manner provided in subsection
 
SB2081 Enrolled            -31-                LRB9212879JSpc
 1    (d) of  Section  5-104  of  this  Act.  An  electric  utility
 2    implementing  an  accelerated  cost recovery method including
 3    accelerated depreciation, accelerated amortization  or  other
 4    capital  recovery  methods,  or  recording  reductions to the
 5    original cost of its assets, pursuant to  subsection  (g)  of
 6    this  Section,  shall  file  a  statement with the Commission
 7    describing  the  accelerated  cost  recovery  method  to   be
 8    implemented  or  the  reduction  in  the original cost of its
 9    assets to be recorded.  Upon the filing  of  such  statement,
10    the  accelerated cost recovery method or the reduction in the
11    original cost of assets shall be deemed to be approved by the
12    Commission as  though  an  order  had  been  entered  by  the
13    Commission.
14        (i)  Subsequent  to  the mandatory transition period, the
15    Commission, in any proceeding to establish rates and  charges
16    for  tariffed  services offered by an electric utility, shall
17    consider only (1) the then  current  or  projected  revenues,
18    costs, investments and cost of capital directly or indirectly
19    associated  with the provision of such tariffed services; (2)
20    collection of transition charges in accordance with  Sections
21    16-102  and  16-108 of this Act; (3) recovery of any employee
22    transition costs as described in  Section  16-128  which  the
23    electric  utility  is continuing to incur, including recovery
24    of any unamortized portion of such costs previously  incurred
25    or committed, with such costs to be equitably allocated among
26    bundled  services,  delivery  services,  and  contracts  with
27    alternative  retail  electric  suppliers; and (4) recovery of
28    the costs associated with the electric  utility's  compliance
29    with  decommissioning  funding  requirements;  and  shall not
30    consider any other revenues, costs, investments  or  cost  of
31    capital of either the electric utility or of any affiliate of
32    the  electric  utility  that  are  not  associated  with  the
33    provision   of  tariffed  services.   In  setting  rates  for
34    tariffed services, the Commission  shall  equitably  allocate
 
SB2081 Enrolled            -32-                LRB9212879JSpc
 1    joint  and  common costs and investments between the electric
 2    utility's competitive and tariffed services.  In  determining
 3    the  justness  and  reasonableness  of the electric power and
 4    energy component of an electric utility's rates for  tariffed
 5    services  subsequent  to  the mandatory transition period and
 6    prior to the time that the provision of such  electric  power
 7    and  energy  is  declared  competitive,  the Commission shall
 8    consider the extent to which the electric utility's  tariffed
 9    rates  for  such component for each customer class exceed the
10    market value determined pursuant to Section 16-112,  and,  if
11    the electric power and energy component of such tariffed rate
12    exceeds  the  market  value by more than 10% for any customer
13    class, may establish such electric power and energy component
14    at a rate equal to the market value plus  10%.  In  any  such
15    case,  the Commission may also elect to extend the provisions
16    of Section 16-111(e) for any period  in  which  the  electric
17    utility  is  collecting transition charges, using information
18    applicable to such period.
19        (j)  During the mandatory transition period, an  electric
20    utility  may  elect  to  transfer  to  a non-operating income
21    account under the Commission's  Uniform  System  of  Accounts
22    either or both of (i) an amount of unamortized investment tax
23    credit  that  is  in  addition to the ratable amount which is
24    credited to the electric utility's operating  income  account
25    for  the  year  in  accordance  with  Section 46(f)(2) of the
26    federal Internal Revenue Code of 1986, as in effect prior  to
27    P.L.  101-508, or (ii) "excess tax reserves", as that term is
28    defined in Section 203(e)(2)(A) of the federal Tax Reform Act
29    of 1986, provided that (A) the  amount  transferred  may  not
30    exceed  the amount of the electric utility's assets that were
31    created  pursuant  to  Statement  of   Financial   Accounting
32    Standards  No.  71 which the electric utility has written off
33    during the mandatory transition period, and (B) the  transfer
34    shall not be effective until approved by the Internal Revenue
 
SB2081 Enrolled            -33-                LRB9212879JSpc
 1    Service.   An  electric  utility  electing  to  make  such  a
 2    transfer  shall  file a statement with the Commission stating
 3    the amount and timing of the transfer for which it intends to
 4    request approval of the Internal Revenue Service, along  with
 5    a  copy  of  its  proposed  request  to  the Internal Revenue
 6    Service for a ruling.  The Commission shall  issue  an  order
 7    within 14 days after the electric utility's filing approving,
 8    subject  to  receipt  of  approval  from the Internal Revenue
 9    Service, the proposed transfer.
10        (k)  If an electric utility is selling or transferring to
11    a single buyer 5 or more generating plants  located  in  this
12    State  with a total net dependable capacity of 5000 megawatts
13    or more pursuant to subsection (g) of this  Section  and  has
14    obtained  a  sale price or consideration that exceeds 200% of
15    the book value of such  plants,  the  electric  utility  must
16    provide  to  the  Governor,  the  President  of  the Illinois
17    Senate, the Minority  Leader  of  the  Illinois  Senate,  the
18    Speaker  of  the  Illinois  House of Representatives, and the
19    Minority Leader of the Illinois House of  Representatives  no
20    later  than  15 days after filing its notice under subsection
21    (g) of this Section or 5 days after the date  on  which  this
22    subsection  (k)  becomes  law,  whichever is later, a written
23    commitment in which such electric utility agrees to expend $2
24    billion outside the corporate limits of any municipality with
25    1,000,000 or more inhabitants within such electric  utility's
26    service  area,  over  a  6-year  period  beginning  with  the
27    calendar  year  in  which  the  notice is filed, on projects,
28    programs, and improvements within its service  area  relating
29    to   transmission   and   distribution   including,   without
30    limitation, infrastructure expansion, repair and replacement,
31    capital   investments,   operations   and   maintenance,  and
32    vegetation management.
33    (Source: P.A. 90-561, eff. 12-16-97; 90-563,  eff.  12-16-97;
34    91-50, eff. 6-30-99.)
 
SB2081 Enrolled            -34-                LRB9212879JSpc
 1        (220 ILCS 5/16-111.3 new)
 2        Sec.  16-111.3.  Transition period earnings calculations.
 3    At such time as the Board of Governors of the Federal Reserve
 4    System ceases  to  include  the  monthly  average  yields  of
 5    30-year  U.S.  Treasury  bonds in its weekly H.15 Statistical
 6    Release  or  successor  publication,  the  Monthly   Treasury
 7    Long-Term Average Rates (25 years and above) published by the
 8    Board  of  Governors  of  the  Federal  Reserve System in its
 9    weekly H.15  Statistical  Release  or  successor  publication
10    shall  instead be used to establish a rate for the purpose of
11    calculating the Index defined in subsection  (e)  of  Section
12    16-111  of  this Act, and at such time, such Monthly Treasury
13    Long-Term Average Rates (25 years and above)  shall  also  be
14    used  in  place of the monthly average yields of 30-year U.S.
15    Treasury bonds in the rate of return calculation required  by
16    subsection  (d) of Section 16-111.  An electric utility shall
17    also remove the effects, if any, of any impairment due to the
18    application of Statement of  Financial  Accounting  Standards
19    No.  142,  which  was  issued  in  June 2001, when making the
20    calculations required by this Section or by  subsections  (d)
21    and (e) of Section 16-111.

22        Section  99.  Effective date.  This Act takes effect upon
23    becoming law.

[ Top ]