Chapter 05-061

2005 -- S 0550

Enacted 06/23/05

A N A C T

RELATING TO PUBLIC UTILITIES AND CARRIERS -- DUTIES OF UTILITIES AND

CARRIERS

Introduced By: Senators Perry, Goodwin, McCaffrey, Tassoni, and McBurney

Date Introduced: February 10, 2005

It is enacted by the General Assembly as follows:

     SECTION 1. Section 39-2-1.2 of the General Laws in Chapter 39-2 entitled "Duties of

Utilities and Carriers" is hereby amended to read as follows:

39-2-1.2. Utility base rate -- Advertising, demand side management and renewables.

-- (a) In addition to costs prohibited in section 39-1-27.4(b), no public utility distributing or

providing heat, electricity, or water to or for the public shall include as part of its base rate any

expenses for advertising, either direct or indirect, which promotes the use of its product or

service, or is designed to promote the public image of the industry. No public utility may furnish

support of any kind, direct, or indirect, to any subsidiary, group, association, or individual for

advertising and include the expense as part of its base rate. Nothing contained in this section shall

be deemed as prohibiting the inclusion in the base rate of expenses incurred for advertising,

informational or educational in nature, which is designed to promote public safety conservation of

the public utility's product or service. The public utilities commission shall promulgate such rules

and regulations as are necessary to require public disclosure of all advertising expenses of any

kind, direct or indirect, and to otherwise effectuate the provisions of this section.

      (b) Effective as of January 1, 2003, and for a period of ten (10) years thereafter, each

electric distribution company shall include charges of 2.0 mills per kilowatt-hour delivered to

fund demand side management programs and 0.3 mills per kilowatt-hour delivered to fund

renewable energy programs. Existing charges for these purposes and their method of

administration shall continue through December 31, 2002. Thereafter, the electric distribution

company shall establish two (2) separate accounts, one for demand side management programs,

which shall be administered and implemented by the distribution company, subject to the

regulatory reviewing authority of the commission, and one for renewable energy programs, which

shall be administered by the state energy office.

      During the ten (10) year period the commission may, in its discretion, after notice and

public hearing, increase the sums for demand side management and renewable resources;

thereafter, the commission shall, after notice and public hearing, determine the appropriate charge

for these programs. The energy office and the administrator of the renewable energy programs

shall seek to secure for the state an equitable and reasonable portion of renewable energy credits

or certificates created by projects funded through those programs. As used in this section,

"renewable energy resources" shall mean power generation technologies that produce electricity

from wind energy, small scale (less than 100 megawatts) hydropower plants that do not require

the construction of new dams, solar energy, and sustainably managed biomass. as defined in

section 39-26-5, "eligible renewable energy resources". Technologies for converting solar energy

for space heating or generating domestic hot water may also be funded through the renewable

energy programs, so long as these technologies are installed on housing projects that have been

certified by the executive director of the Rhode Island housing and mortgage finance corporation

as serving low-income Rhode Island residents. Fuel cells may be considered an energy efficiency

technology to be included in demand sided management programs. Special rates for low income

customers in effect as of August 7, 1996 shall be continued, and the costs of all of these discounts

shall be included in the distribution rates charged to all other customers. Nothing in this section

shall be construed as prohibiting an electric distribution company from offering any special rates

or programs for low income customers which are not in effect as of August 7, 1996, subject to the

approval by the commission.

      (c) The director of the state energy office is authorized and shall enter into a contract

with a contractor for the effective administration of the renewable energy programs funded by

this section. The director shall initiate the competitive bid process by the issuance and

advertisement of specifications and request for proposals, on or before September 1, 2002. The

contract resulting from the competitive bid process shall be awarded to become effective for a

three (3) year period commencing no later than January 1, 2003. A competitive bid and contract

award for administration of the renewable energy programs shall occur every three (3) years

thereafter.

     SECTION 2. This act shall take effect upon passage.

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LC02100

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