2017 -- S 0877

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LC002622

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2017

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A N   A C T

RELATING TO PUBLIC UTILITIES AND CARRIERS - REGULATORY POWERS OF

ADMINISTRATION

     

     Introduced By: Senators Lynch Prata, and Gallo

     Date Introduced: May 11, 2017

     Referred To: Senate Commerce

     It is enacted by the General Assembly as follows:

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     SECTION 1. Section 39-3-1.2 of the General Laws in Chapter 39-3 entitled "Regulatory

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Powers of Administration" is hereby amended to read as follows:

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     39-3-1.2. Aggregation of electrical load by municipality or group of municipalities.

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     (a) The legislative authority of a municipality may adopt an ordinance or resolution,

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under which it may aggregate in accordance with this section one or more classes of the retail

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electrical loads located, respectively, within the municipality or town and, for that purpose, may

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enter into service agreements to facilitate for those loads the sale and purchase of electricity. The

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legislative authority also may exercise this authority jointly with any other legislative authority.

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An ordinance or resolution under this section shall specify whether the aggregation will occur

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only with the prior consent of each person owning, occupying, controlling, or using an electric

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load center proposed to be aggregated or will occur automatically for all persons pursuant to the

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opt-out requirements of this section. Nothing in this section, however, authorizes the aggregation

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of retail electric loads of an electric load center that is located in the certified territory of a

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nonprofit electric supplier or an electric load center served by transmission or distribution

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facilities of a municipal electric utility. If an ordinance or resolution adopted under this section

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specifies that aggregation will occur automatically as described in this section, the ordinance or

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resolution shall direct the board of canvassers to submit the question of the authority to aggregate

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to the electors of the respective municipality or town at a special election on the day of the next

 

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primary or general election in the municipality or town. The legislative authority shall certify a

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copy of the ordinance or resolution to the board of canvassers not less than seventy-five (75) days

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before the day of the special election. No ordinance or resolution adopted under this section that

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provides for an election under this section shall take effect unless approved by a majority of the

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electors voting upon the ordinance or resolution at the election held pursuant to this section.

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     No legislative authority pursuant to an ordinance or resolution under this section that

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provides for automatic aggregation as described in this section, shall aggregate the electrical load

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of any electric load center located within its jurisdiction unless it in advance clearly discloses to

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the person owning, occupying, controlling, or using the load center that the person will be

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enrolled automatically in the aggregation program and will remain so enrolled unless the person

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affirmatively elects by a stated procedure not to be so enrolled. The disclosure shall state

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prominently the rates, charges, and other terms and conditions of enrollment. The stated

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procedure shall allow any person enrolled in the aggregation program the opportunity, at a

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minimum, to opt-out of the program every two (2) years, without paying a switching fee. Any

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person that leaves the aggregation program pursuant to the stated procedure shall default to the

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last resort service until the person chooses an alternative supplier.

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     A governmental aggregator under this section is not a public utility engaging in the

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wholesale purchase and resale of electricity, and the aggregated service is not a wholesale utility

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transaction. A governmental aggregator shall be subject to supervision and regulation by the

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commission only to the extent of any competitive retail electric service it provides and

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commission authority.

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     A town may initiate a process to authorize aggregation by a majority vote of a town

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meeting or of the town council. A city may initiate a process to authorize aggregation by a

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majority vote of the city council, with the approval of the mayor, or the city manager. Two (2) or

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more municipalities, as a group, initiate a process jointly to authorize aggregation by a majority

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vote of each particular municipality as required in this section.

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     Upon the applicable requisite authority under this section, the legislative authority shall

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develop a plan of operation and governance for the aggregation program so authorized. Before

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adopting a plan under this section, the legislative authority shall hold at least two (2) one public

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hearings hearing on the plan. Before the first hearing, the legislative authority shall publish notice

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of the hearings once a week for two (2) consecutive weeks in a newspaper of general circulation

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in the jurisdiction. The notice shall summarize the plan and state the date, time, and location of

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each any hearing. A municipality or group of municipalities establishing load aggregation

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pursuant to this section shall, in consultation with the commission, develop a plan, for review by

 

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its citizens, detailing the process and consequences of aggregation. The plan shall identify which

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classes of customers may participate, based on their applicable electric distribution company

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tariff or rate schedule. Any municipal load aggregation plan established pursuant to this section

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shall provide for universal access to all applicable customers and equitable treatment of

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applicable classes of customers and shall meet any requirements established by law or the

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commission concerning aggregated service. The plan shall be filed with the commission, for its

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final review and approval, and shall include, without limitation, an organizational structure of the

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program, its operations, and its funding; methods of the process for establishing rates and

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allocating costs among participants; the methods for entering and terminating agreements with

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other entities; the rights and responsibilities of program participants; and termination of the

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program. The plan must also include the terms and conditions under which retail customers who

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have chosen to opt-out of the aggregated service may take service from the aggregated entity. At

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the time of the legislative authority's filing of the plan with the commission, a copy of the

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proposed plan filing shall be provided to the electric distribution company whose customers

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would be included in the plan. Prior to its decision, the commission shall conduct a public

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hearing. Following approval of the plan, the legislative authority may solicit bids from

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nonregulated power producers pursuant to the methods established by the plan. The legislative

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authority shall report the results of this solicitation and proposed agreement awards to the

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commission, which shall have five (5) business days in which it may suspend such awards if the

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solicitation or awards are not in conformance with the plan or if the cost for energy would in the

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first year exceed the cost of that energy on the standard offer, as established pursuant to this

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chapter, for citizens in the municipality or group of municipalities, unless the applicant can

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demonstrate that the cost for energy under the aggregation plan will be lower than the standard

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offer in the subsequent years or the applicant can demonstrate that the excess cost is due to the

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purchase of renewable energy as described by the commission. If the commission does not

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suspend the proposed contract awards within five (5) business days of filing, the legislative

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authority shall have the right to award the proposed agreements.

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     The legislative authority shall have the right to terminate the operation of the plan by

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placing its customers on last resort service. If the legislative authority terminates the operation of

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the plan and places customers on last resort service, a municipality seeking to form a new

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municipal aggregation load must submit a new plan to the commission for approval, in

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accordance with this section, before its customers may enroll in the new aggregation program.

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     Any retail customer in a municipality with an approved aggregation plan may elect

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instead to receive retail supply from another licensed retail supplier or from the local distribution

 

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company. Within thirty (30) days of the date the aggregated entity is fully operational, ratepayers

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who have not affirmatively elected an alternative authorized supplier shall be transferred to the

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aggregated entity subject to the opt-out provision in this section. Following adoption of

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aggregation as specified above, the program shall allow any retail customer to opt-out and choose

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any supplier or provider that the retail customer wishes. Nothing in this section shall be construed

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as authorizing any city or town or any municipal retail load aggregator to restrict the ability of

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retail electric customers to obtain or receive service from any authorized provider of it.

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     It shall be the duty of the aggregated entity to fully inform participating ratepayers in

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advance of automatic enrollment that they are to be automatically enrolled and that they have the

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right to opt-out of the aggregated entity without penalty. In addition, such disclosure shall

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prominently state all charges to be made and shall include full disclosure of the standard offer

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rate, how to access it, and the fact that it is available to them without penalty, if they are currently

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on standard offer service. The commission shall furnish, without charge, to any citizen a list of all

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other supply options available to them in a meaningful format that shall enable comparison of

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price and product.

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     The municipality or group of municipalities shall, within two (2) years of approval of its

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plan or such further time as the commission may allow, provide written notice to the commission

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that its plan is implemented. The commission may revoke certification of the aggregation plan if

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the municipality or group of municipalities fails to substantially implement the plan.

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     (b) The commission shall may, from time to time, promulgate rules by which the

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legislative authority may request information from the electric distribution company or

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companies whose customers would be included in its plan. These rules shall ensure that

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municipalities have reasonable and timely access to information pertinent to the formation of the

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plan and solicitation of bids to serve customers, that confidentiality of individuals is protected,

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that charges for production of data are reasonable and not unduly burdensome to the legislative

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authority.

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     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 - REGULATORY POWERS OF

ADMINISTRATION

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     This act would amend the provisions of the general laws regulating the aggregation of

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electrical loads by a municipality or group of municipalities, and would require at least one public

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hearing be held, for review by its residents, prior to adopting any plan, which must then be

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approved by the public utilities commission.

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     This act would take effect upon passage.

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