Existing law sets forth certain procedures for a public utility to make changes to a general rate schedule by applying to Public Utilities Commission of Nevada. (NRS 704.100, 704.110) Section 11 of this bill requires the Commission to adopt regulations establishing procedures for a natural gas utility to apply to the Commission for the approval of an alternative rate-making plan, which establishes the alternative rate-making mechanisms that the natural gas utility is authorized to use to set rates during the time period of the plan. The regulations adopted by the Commission must: (1) establish the alternative rate-making mechanisms that may be included in a plan and any limitations on such alternative rate-making mechanisms; (2) prescribe the information that must be included in an alternative rate-making plan and an application for the approval of such a plan; (3) specify the circumstances under which a natural gas utility for which an alternative rate-making plan has been approved must file a general rate application; (4) provide a process to educate customers of a natural gas utility regarding alternative rate-making mechanisms; (5) require a natural gas utility for which an alternative rate-making plan has been approved to keep certain records; and (6) establish criteria for the evaluation of an alternative rate-making plan. Additionally, section 11 requires that, if a natural gas utility files an application for an alternative rate-making plan that includes formula rates or a multi-year rate plan, the alternative rate-making plan must include: (1) an earnings-sharing mechanism; and (2) certain information and calculations relating to changes in risk to the natural gas utility. Section 12 of this bill authorizes a natural gas utility to submit an application to establish an alternative rate-making plan pursuant to the regulations adopted by the Commission, establishes time limits for the Commission to approve or deny such an application and requires the Commission to conduct a consumer session in each major geographic area in which the natural gas utility provides services before taking action on such an application. Section 12 requires an application for the approval of an alternative rate-making plan to include a plan to educate the customers of the natural gas utility regarding the alternative rate-making mechanisms in the plan proposed by the utility. Section 12 prohibits the Commission from approving an alternative rate-making plan unless the Commission determines that the plan meets certain requirements. Section 12 also authorizes an alternative rate-making plan to include certain provisions, including, without limitation, a mechanism for earnings-sharing with the customers of the utility. Additionally, section 12 authorizes a natural gas utility to reject an application for an alternative rate-making plan with modifications approved by the Commission. Finally, section 12 authorizes the Commission to investigate and change rates, tolls, charges, rules, regulations, practices and services relating to an alternative rate-making plan under certain circumstances. Section 13 of this bill provides that the provisions of this bill do not limit the existing rate-making authority of the Commission. Sections 3-10 of this bill define certain terms relating to alternative rate-making plans. Sections 14 and 15 of this bill create exceptions from the procedure set forth in existing law to change a general rate schedule to authorize a natural gas utility to file an application to establish an alternative rate-making plan pursuant to section 12. Existing law requires the Commission to adopt regulations to establish procedures for an electric utility to apply to the Commission for the approval of an alternative rate-making plan. (NRS 704.762) Section 16 of this bill requires that, if an electric utility files an application for an alternative rate-making plan that includes formula rates or a multi-year rate plan, the alternative rate-making plan must include: (1) an earnings-sharing mechanism; and (2) certain information and calculations relating to changes in risk to the electric utility. Existing law authorizes an electric utility to apply to the Commission to establish an alternative rate-making plan and sets forth certain requirements relating to the approval of the plan by the Commission. (NRS 704.7621) Section 17 of this bill requires that, if the Commission approves an application for an alternative rate-making plan that authorizes the recovery of the costs of a capital expenditure: (1) the electric utility must prove the capital expenditure was prudent; and (2) if the Commission determines that the electric utility did not prove the capital expenditure was prudent, the Commission shall require the electric utility to refund the costs of the capital expenditure charged to the customers of the electric utility.

Statutes affected:
As Introduced: 704.100, 704.110
Reprint 1: 704.100, 704.110
Reprint 2: 704.100, 704.110, 704.762, 704.7621
As Enrolled: 704.100, 704.110, 704.762, 704.7621
BDR: 704.100, 704.110