2014 -- H 7791

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LC005042

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2014

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A N   A C T

RELATING TO PUBLIC UTILITIES AND CARRIERS -- LONG-TERM CONTRACTING

STANDARD FOR RENEWABLE ENERGY

     Introduced By: Representatives Naughton, Marcello, Newberry, and E Coderre

     Date Introduced: March 04, 2014

     Referred To: House Corporations

     It is enacted by the General Assembly as follows:

     SECTION 1. Chapter 39-26.1 of the General Laws entitled "Long-Term Contracting

Standard for Renewable Energy" is hereby amended by adding thereto the following section:

     39-26.1-10. Reconsideration of excess costs to ratepayers. – (a) The division of public

utilities shall biannually introduce a docket before the public utilities commission reexamining

the avoided cost implications on the anniversary of any power purchase contract approved under

this chapter that provides for costs in excess of those paid for power under chapter 26.4 of title 39

and that has not yet begun local construction or installation of generation infrastructure. Excess

cost to ratepayers shall be reexamined with regard to any new evidence as to benefits associated

with said projects considering likely liquidated damages for terminating said contract. Should

those excess costs less the costs of termination exceed the benefits, the public utilities

commission shall order the electric distribution company to terminate said contract.

     (b) For the purposes of administration of this section, liquidated damages shall be

narrowly construed to include actual costs incurred by parties to the contracts and real derivative

damages, excepting therefrom any allowances for unearned profits or returns. Investors, if any, in

the project or in public offerings of project bonds shall be entitled to interest to date of the

termination and the refund of any principal but neither the electric distribution company nor its

ratepayers shall be responsible if the actuarial damages together with cash on hand of the project

developer do not compensate investors in the amount specified. It is the policy and determination

of the legislature that those who obtain power supply contractors providing for compensation in

excess of the prevailing market and their investors have no contract rights to profits or returns or

investment security in said projects from power not yet delivered.

     SECTION 2. This act shall take effect upon passage.

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO PUBLIC UTILITIES AND CARRIERS -- LONG-TERM CONTRACTING

STANDARD FOR RENEWABLE ENERGY

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     This act would require that the public utilities commission review biannually any power

purchase contract calling for the local construction or installation of generation infrastructure

which has not yet commenced. It would further require a cost benefit analysis be performed to

determine if said contracts are in the best interest of ratepayers. This act would allow for the

termination of any contract in which the cost to ratepayers exceeds the benefits.

     This act would take effect upon passage.

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