2023 -- H 6047

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LC002223

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     STATE OF RHODE ISLAND

IN GENERAL ASSEMBLY

JANUARY SESSION, A.D. 2023

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A N   A C T

RELATING TO PUBLIC UTILITIES AND CARRIERS -- PUBLIC UTILITIES COMMISSION

     Introduced By: Representative Tina L. Spears

     Date Introduced: March 03, 2023

     Referred To: House Corporations

     It is enacted by the General Assembly as follows:

     SECTION 1. Section 39-1-27.3 of the General Laws in Chapter 39-1 entitled "Public

Utilities Commission" is hereby amended to read as follows:

     39-1-27.3. Electric distribution companies required to provide retail access, standard

offer and last-resort service.

     (a) To promote economic development and the creation and preservation of employment

opportunities within the state, each electric distribution company, except Pascoag Utility District

and the Block Island Utility District, a quasi-municipal corporation, district, and subdivision of the

state (“electric distribution company”), shall offer retail access from nonregulated power producers

to all customers.

     (b) Through year 2009, and effective July 1, 2007, through year 2020, each electric

distribution company shall arrange for a standard power-supply offer (“standard offer”) to

customers that have not elected to enter into power-supply arrangements with other nonregulated

power suppliers. The rates that are charged by the electric distribution company to customers for

standard-offer service shall be approved by the commission and shall be designed to recover the

electric distribution company’s costs and no more than the electric distribution company’s costs;

provided, that the commission may establish and/or implement a rate that averages the costs over

periods of time. The electric distribution company shall not be entitled to recover any profit margin

on the sale of standard-offer power, except with approval of the commission as may be necessary

to implement, fairly and effectively, system reliability and least-cost procurement. The electric

distribution company will be entitled to recover its costs incurred from providing the standard offer

arising out of: (1) Wholesale standard-offer supply agreements with power suppliers in effect prior

to January 1, 2002; (2) Power-supply arrangements that are approved by the commission after

January 1, 2002; (3) Power-supply arrangements made pursuant to §§ 39-1-27.3.1 and 39-1-27.8;

and (4) Any other power-supply-related arrangements prudently made after January 1, 2002, to

provide standard-offer supply or to mitigate standard-offer supply costs, including costs for system

reliability, procurement, and least-cost procurement, as provided for in § 39-1-27.7. Subject to

commission approval, the electric distribution company may enter into financial contracts designed

to hedge fuel-related or other variable costs associated with power-supply arrangements and the

costs of any such financial contracts shall be recoverable in standard-offer rates. The electric

distribution company’s standard-offer revenues and its standard-offer costs shall be accounted for

and reconciled with interest at least annually. Except as otherwise may be directed by the

commission in order to accomplish purposes established by law, any over recoveries shall be

refunded to customers in a manner directed by the commission, and any under recoveries shall be

recovered by the electric distribution company through a uniform adjustment factor approved by

the commission. The commission shall have the discretion to apply such adjustment factor in any

given instance to all customers or to such specific class of customers that the commission deems

equitable under the circumstances provided that the distribution company recovers any under

recovery in its entirety. Once a customer has elected to enter into a power-supply arrangement with

a nonregulated power producer, the electric distribution company shall not be required to arrange

for the standard offer to such customer except as provided in § 39-1-27.3.1. No customer who

initially elects the standard offer and then chooses an alternative supplier shall be required to pay

any withdrawal fee or penalty to the provider of the standard offer unless such a penalty or

withdrawal fee was agreed to as part of a contract; however, no residential customer shall be

required to pay a penalty or withdrawal fee for choosing an alternative supplier. Nothing in this

subsection shall be construed to restrict the right of any nonregulated power producer to offer to

sell power to customers at a price comparable to that of the standard offer specified pursuant to this

subsection. The electric distribution company may not terminate an existing standard-offer

wholesale supply agreement without the written consent of the division.

     (c) In recognition that electricity is an essential service, each electric distribution company

shall arrange for a last-resort power supply for customers who have left the standard offer for any

reason and are not otherwise receiving electric service from nonregulated power producers. The

electric distribution company shall procure last-resort service supply from wholesale power

suppliers. Prior to acquiring last-resort supply, the electric distribution company will file with the

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commission a supply acquisition plan or plans that include the acquisition procedure, the pricing

options being sought, and a proposed term of service for which last-resort service will be acquired.

The term of service may be short- or long-term and acquisitions may occur from time to time and

for more than one supplier for segments of last-resort service load over different terms, if

appropriate. All the components of the acquisition plans, however, shall be subject to commission

review and approval. Once an acquisition plan is approved by the commission, the electric

distribution company shall be authorized to acquire last-resort service supply consistent with the

approved acquisition plan and recover its costs incurred from providing last-resort service pursuant

to the approved acquisition plan. The commission may periodically review the acquisition plan to

determine whether it should be prospectively modified due to changed market conditions. The

commission shall have the authority and discretion to approve special tariff conditions and rates

proposed by the electric distribution company that the commission finds are in the public interest,

including without limitation: (1) Short- or long-term optional service at different rates; (2) Term

commitments or notice provisions before individual customers leave last-resort service; (3) Last-

resort service rates for residential or any other special class of customers that are different than the

rates for other last-resort customers; and/or (4) Last-resort service rates that are designed to

encourage any class of customers to return to the market. The electric distribution company’s last-

resort service revenues and its last-resort service costs shall be accounted for and reconciled with

interest at least annually. Any over recoveries shall be refunded and any under recoveries shall be

recovered by the electric distribution company through a uniform adjustment factor approved by

the commission. The commission shall have the discretion to apply such adjustment factor in any

given instance to all customers or to such specific class of customers that the commission deems

equitable under the circumstances provided that the distribution company recovers any under

recovery in its entirety. Nothing in this section shall be construed to prohibit an electric distribution

company from terminating service provided hereunder in accordance with commission rules and

regulations in the event of nonpayment of this service. The commission may promulgate

regulations to implement this section including the terms and conditions upon which last-resort

service is offered and provided to customers.

     (d) If a customer being served by a nonregulated power producer pays any taxes assessed

for electric service to the electric distribution company and the electric distribution company

forwards such tax payment for the power portion of the bill to a nonregulated power producer for

payment by the nonregulated power producer to the state, neither the customer nor the electric

distribution company shall be liable for such taxes forwarded if the nonregulated power producer

fails to remit such taxes to the state for any reason.

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     SECTION 2. Section 45-67-10 of the General Laws in Chapter 45-67 entitled "Block Island

Utility District Act of 2017" is hereby amended to read as follows:

     45-67-10. Exemptions.

     (a) The exemption waiver provided by the public utilities commission to BIPCo from the

terms of § 39-1-27 shall also apply to the utility district and the public utilities commission shall

have the authority to provide such other waivers from this section as may be in the public interest.

     (b) The utility district shall, from time to time, submit plans to the public utilities

commission on retail choice as defined in § 39-1-27.3. The public utilities commission shall have

the authority to approve those plans as may be in the interests of all ratepayers of the utility district,

including the option of not offering retail choice. Any waiver on retail choice granted by the public

utilities commission to BIPCo shall also apply to the utility district.

     (c) The exemptions provided for the Pascoag utility district and BIPCo under §§ 39-1-

27.3.1, 39-1-27.12, 39-2-1.2(b), 39-2-25, 39-26.1-1 through and including 39-26.1-6, and chapters

1.1, 26, 26.2, 26.4, and 26.6 of title 39 shall also apply to the Block Island utility district. The utility

district shall be exempt from the provisions of chapter 18 of title 35.

     (d) As long as the utility district has a waiver from the restructuring provisions of § 39-1-

27, then the utility district shall also be granted a waiver from the provisions of § 39-1-27.6 such

that the employees of the utility district may be allowed to provide both electrical generation and

distribution services.

     SECTION 3. This act shall take effect upon passage.

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LC002223

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EXPLANATION

BY THE LEGISLATIVE COUNCIL

OF

A N   A C T

RELATING TO PUBLIC UTILITIES AND CARRIERS -- PUBLIC UTILITIES COMMISSION

***

     This act would include the Block Island Utility District as one of the electric companies

that are exempt from offering retail access from nonregulated power producers to all customers.

     This act would take effect upon passage.

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LC002223

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