Bill Summary – FastDemocracy

Enrolled Copy                                                                              H.B. 431
                  ENERGY EFFICIENCY PROGRAMS AMENDMENTS
                                         2020 GENERAL SESSION
                                              STATE OF UTAH
                                 Chief Sponsor: Stephen G. Handy
                                  Senate Sponsor: Curtis S. Bramble
 Cosponsor:
 Jeffrey D. Stenquist
 8
 LONG TITLE
 General Description:
         This bill amends provisions related to energy efficiency programs for large-scale natural
 gas utilities and large-scale electric utilities.
 Highlighted Provisions:
         This bill:
         < modifies the definition of "demand side management" in the context of an
 authorized tariff relating to energy efficiency and conservation, to include the use of
 heat pumps; and
         < requires the Public Service Commission to allow an end-use customer of a
 large-scale electric utility or a large-scale natural gas utility to continue to receive a
 credit or rebate under an approved demand side management tariff or schedule
 under certain circumstances.
 Money Appropriated in this Bill:
         None
 Other Special Clauses:
         None
 Utah Code Sections Affected:
 AMENDS:
         54-7-12, as last amended by Laws of Utah 2009, Chapter 319
       H.B. 431                                                                          Enrolled Copy
         54-7-12.8, as last amended by Laws of Utah 2016, Chapter 393
30
 Be it enacted by the Legislature of the state of Utah:
         Section 1. Section 54-7-12 is amended to read:
         54-7-12. Rate increase or decrease -- Procedure -- Effective dates -- Electrical or
 telephone cooperative.
         (1) As used in this section:
         (a) (i) "Base rates" means those charges included in a public utility's generally
 applicable rate tariffs, including:
         (A) a fare;
         (B) a rate;
         (C) a rental;
         (D) a toll; or
         (E) any other charge generally applicable to a public utility's rate tariffs.
         (ii) Unless included by a commission order, "base rates" does not include charges
 included in:
         (A) a deferred account;
         (B) a balancing account;
         (C) a major plant addition surcharge;
         (D) a major plant addition surcredit;
         (E) a special contract; or
         (F) a public utility program offering.
         (b) (i) "Complete filing" means an application filed by a public utility that substantially
 complies with minimum filing requirements established by the commission, by rule, for a
 general rate increase or decrease.
         (ii) The commission shall within 180 days after March 25, 2009 create and finalize
 rules concerning the minimum requirements to be met for an application to be considered a
 complete filing.
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       Enrolled Copy                                                                              H.B. 431
         (c) "General rate decrease" means:
         (i) any direct decrease to a public utility's base rates; or
         (ii) any modification of a classification, contract, practice, or rule that decreases a
 public utility's base rates.
         (d) "General rate increase" means:
         (i) any direct increase to a public utility's base rates; or
         (ii) any modification of a classification, contract, practice, or rule that increases a
 public utility's base rates.
         (2) (a) A public utility that files for a general rate increase or general rate decrease shall
 file a complete filing with the commission setting forth the proposed rate increase or decrease.
         (b) (i) For purposes of this Subsection (2), a public utility's application for a general
 rate increase or decrease shall be considered a complete filing unless within 30 days after the
 day on which the commission receives the public utility's application, the commission issues an
 order describing information that the public utility must provide for the application to be
 considered a complete filing.
         (ii) Subject to Subsection (2)(b)(iii) and within 14 days after the day on which the
 application is received by the commission, a party or a person may file a motion to challenge
 whether an application for a general rate increase or decrease is a complete filing.
         (iii) A party or a person may not file a motion described in Subsection (2)(b)(ii) unless
 the person or party has first filed a motion to intervene with the commission.
         (c) If, in accordance with Subsection (2)(b)(i), the commission issues an order that an
 application is not a complete filing, the commission shall:
         (i) determine the materiality of an application deficiency; and
         (ii) (A) if the deficiencies are not material, issue an order that the 240-day period
 described in Subsection (3)(a) shall continue without delay or be suspended and resume when
 the public utility files the required information; or
         (B) if the deficiencies are material, issue an order that the 240-day period described in
 Subsection (3)(a) shall start over when the public utility files the required information.
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        H.B. 431                                                                          Enrolled Copy
         (d) (i) The commission shall, after reasonable notice, hold a hearing to determine
 whether the proposed rate increase or decrease, or some other rate increase or decrease, is just
 and reasonable.
         (ii) If a rate decrease is proposed by a public utility, the commission may waive a
 hearing unless it seeks to suspend, alter, or modify the rate decrease.
         (e) Except as otherwise provided in Subsection (2)(d), (3), or (4), a proposed rate
 increase or decrease is not effective until after completion of the hearing and issuance of a final
 order by the commission concerning the proposed increase or decrease.
         (3) (a) Within 240 days after a public utility submits a complete filing, the commission
 shall issue a final order to:
         (i) grant the proposed general rate increase or decrease;
         (ii) grant a different general rate increase or decrease; or
         (iii) deny the proposed general rate increase or decrease.
         (b) If the commission does not issue a final written order within 240 days after the
 public utility submits a complete filing in accordance with Subsection (3)(a):
         (i) the public utility's proposed rate increase or decrease is final; and
         (ii) the commission may not order a refund of any amount already collected or returned
 by the public utility under Subsection [(4)] (3)(a).
         (4) (a) (i) A request for interim rates shall be made within 90 days after the day on
 which a public utility files a complete filing for a general rate increase or a general rate
 decrease.
         (ii) The commission, on its own initiative or in response to an application by a public
 utility or other party, may, after a hearing, allow any rate increase or decrease proposed by a
 public utility, or a reasonable part of the rate increase or decrease, to take effect on an interim
 basis within 45 days after the day on which the request is filed, subject to the commission's
 right to order a refund or surcharge.
         (iii) The evidence presented in the hearing held pursuant to this Subsection (4) need
 not encompass all issues that may be considered in a rate case hearing held pursuant to
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        Enrolled Copy                                                                               H.B. 431
 Subsection (2)(d), but shall establish an adequate prima facie showing that the interim rate
 increase or decrease is justified.
         (b) The commission may, after a hearing, issue a final order before the expiration of
 240 days after the day on which the public utility files a complete filing establishing the utility's
 revenue requirement and fixing the utility's allowable rates before the commission determines
 the final allocation of the increase or decrease among categories of customers and classes of
 service.
         (c) (i) If the commission in the commission's final order on a public utility's revenue
 requirement finds that the interim increase ordered under Subsection (4)(a)(ii) exceeds the
 increase finally ordered, the commission shall order the public utility to refund the excess to
 customers.
         (ii) If the commission in the commission's final order on a public utility's revenue
 requirement finds that the interim decrease ordered under Subsection (4)(a)(ii) exceeds the
 decrease finally ordered, the commission shall order a surcharge to customers to recover the
 excess decrease.
         (5) (a) Notwithstanding any other provisions of this title, any schedule, classification,
 practice, or rule filed by a public utility with the commission that does not result in any rate
 increase shall take effect 30 days after the date of filing or within any lesser time the
 commission may grant, subject to its authority after a hearing to suspend, alter, or modify that
 schedule, classification, practice, or rule.
         (b) When the commission suspends a schedule, classification, practice, or rule, the
 commission shall hold a hearing on the schedule, classification, practice, or rule before issuing
 its final order.
         (c) For purposes of this Subsection (5), any schedule, classification, practice, or rule
 that introduces a service or product not previously offered may not result in a rate increase.
         (6) Notwithstanding any other provision of this title, whenever a public utility files
 with the commission any schedule, classification, practice, or rule that does not result in an
 increase in any rate, fare, toll, rental, or charge, the schedule, classification, practice, or rule
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        H.B. 431                                                                          Enrolled Copy
 shall take effect 30 days after the date of filing or at any earlier time the commission may grant,
 subject to the authority of the commission, after a hearing, to suspend, alter, or modify the
 schedule, classification, practice, or rule.
         (7) This section does not apply to any rate changes of an electrical or telephone
 cooperative that meets all of the requirements of this Subsection (7).
         (a) (i) The cooperative is organized for the purpose of either distributing electricity or
 providing telecommunication services to its members and the public at cost.
         (ii) "At cost" includes interest costs and a reasonable rate of return as determined by
 the cooperative's board of directors.
         (b) The cooperative's board of directors and any appropriate agency of the federal
 government have approved the rate increase or other rate change and all necessary tariff
 revisions reflecting the increased rate or rate change.
         (c) Before implementing any rate increases, the cooperative has held a public meeting
 for all its customers and members. The cooperative shall mail a notice of the meeting to all of
 the cooperative's customers and members not less than 10 days prior to the date that the
 meeting is held.
         (d) The cooperative has filed its tariff revisions reflecting the rate increase or other rate
 change with the commission, who shall make the tariffs available for public inspection.
         (8) Notwithstanding Subsections (2) and (4), the procedures for implementing a
 proposed rate increase by a telephone corporation having less than 30,000 subscriber access
 lines in the state are provided in this Subsection (8).
         (a) (i) The proposed rate increase by a telephone corporation subject to this Subsection
 (8) may become effective on the day the telephone corporation files with the commission the
 proposed tariff revisions and necessary information to support a determination by the
 commission that the proposed rate increase is just and reasonable.
         (ii) The telephone corporation shall notify the commission and all potentially affected
 access line subscribers of the proposed rate increase 30 days before filing the proposed rate
 increase or change.
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        Enrolled Copy                                                                          H.B. 431
        (b) (i) The commission may investigate whether the proposed rate increase is just and
 reasonable.
        (ii) If the commission determines, after notice and hearing, that the rate increase is
 unjust or unreasonable in whole or in part, the commission may establish the rates, charges, or
 classifications that the commission finds to be just and reasonable.
        (c) The commission shall investigate and hold a hearing to determine whether any
 proposed rate increase is just and reasonable if 10% or more of the telephone corporation's
 potentially affected access line subscribers file a request for agency action requesting an
 investigation and hearing.
        (9) For a rebate received by an end-use customer under a demand side management
 program of a large-scale natural gas utility's approved schedule, the commission shall allow the
 end-use customer to continue receiving the rebate for up to one calendar year if:
        (a) the end-use customer:
        (i) is currently participating in the demand side management program; and
        (ii) has completed new construction within the previous 12 months; and
        (b) the schedule under which the rebate was created is modified due to a change in:
        (i) standards adopted under Title 15A, State Construction and Fire Codes Act; or
        (ii) 10 C.F.R. Chapter 2, Chapter 3, and Chapter 5.
        Section 2. Section 54-7-12.8 is amended to read:
        54-7-12.8. Electric energy efficiency, sustainable transportation and energy, and
 conservation tariff.
        (1) As used in this section:
        (a) "Demand side management" means an activity or program that promotes electric
 energy efficiency or conservation, the use of heat pumps, or more efficient management of
 electric energy loads.
        (b) "Pilot program period" means a period of five years, beginning on January 1, 2017,
 during which the sustainable transportation and energy plan is effective.
        (c) "Sustainable transportation and energy plan" means the same as that term is defined
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        H.B. 431                                                                          Enrolled Copy
 in Section 54-20-102.
         (d) "Utah solar incentive program" means the eligible utility rooftop solar pilot
 program established by commission order in 2012.
         (2) (a) As provided in this section, the commission may approve a tariff under which
 an electrical corporation includes a line item charge on the electrical corporation's customers'
 bills to recover costs incurred by the electrical corporation for demand side management.
         (b) The commission shall authorize a large-scale electric utility that is allowed to
 charge a customer for demand side management under Subsection (2)(a) to:
         (i) if requested by the large-scale electric utility, capitalize the annual costs incurred for
 demand side management provided in Subsection (2)(a);
         (ii) amortize the annual cost for demand side management over a period of 10 years;
         (iii) apply a carrying charge to the unamortized balance that is equal to the large-scale
 electric utility's pretax weighted average cost of capital approved by the commission in the
 large-scale electric utility's most recent general rate proceeding; and
         (iv) recover the amortization cost described in Subsection (2)(b)(ii) and the carrying
 charge described in Subsection (2)(b)(iii) in customer rates.
         (3) The commission shall, before January 1, 2017, authorize a large-scale electric
 utility to implement a combined line item charge on the large-scale electric utility's customers'
 bills to recover the cost to the large-scale electric utility of:
         (a) demand side management, including the cost of amortizing a deferred balance;
         (b) the sustainable transportation and energy plan; and
         (c) the additional expense described in Subsection (5)(a)(i).
         (4) On December 31, 2016, the commission shall end the Utah solar incentive program
 and surcharge tariff and the large-scale electric utility shall stop accepting new applications for
 solar incentive program incentives.
         (5) (a) The commission may authorize a large-scale electric utility that capitalizes
 demand side management costs under Subsection (2)(b) to:
         (i) recognize the difference between the annual revenues the large-scale electric utility
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        Enrolled Copy                                                                              H.B. 431
 collects for demand side management and the annual amount of the large-scale electric utility's
 demand side management cost amortization expense as an additional expense;
         (ii) establish and fund, via the additional expense described