SB 759 Modifies provisions relating to utilities
Sponsor: Lager
LR Number: 5616S.01I Fiscal Note available
Committee: Commerce, Consumer Protection, Energy and the Environment
Last Action: 3/27/2012 - SCS Voted Do Pass S Commerce, Consumer Protection, Energy and the Environment Committee - (5616S.04C) Journal Page:
Title: Calendar Position:
Effective Date: Emergency Clause

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Current Bill Summary


SCS/SB 759 - SECTION 386.370 - PUBLIC SERVICE COMMISSION

Under current law, the Public Service Commission (PSC) receives funding from a fee assessed to each regulated public utility based on the proportionate amount of time and expenses spent by the PSC on each utility. The act lowers the total amount that may be collected for the PSC from the fee, from its current maximum of .25% of the total gross intrastate operating revenue to .23% of total gross intrastate operating revenue.

This section is identical to the same section in SB 869 (2012).

SECTION 386.715 - OFFICE OF PUBLIC COUNSEL

The act requires the Office of Public Counsel (OPC) to, prior to the beginning of each fiscal year, inform the PSC of its estimated expenses for the upcoming fiscal year. The OPC must specify how much of its estimated expenses are directly attributable to its work with each type of PSC-regulated public utility (i.e., electric, gas, water, heating, telephone, and sewer) as well as the amount of expenses that are not directly attributable to one specific type of utility. Costs for telephone companies, water companies, and gas companies may not exceed 3%, 8%, and 15%, respectively, of the total directly attributable costs, with the remainder allocated to electric companies. Costs not directly attributable to one specific type of utility must be proportionately attributed to each utility type based on each utility type's percentage of total gross intrastate operating revenues across all utilities.

The PSC must levy an assessment to each regulated public utility to cover its share of the OPC's costs. The total amount levied to all utilities must not exceed 400ths of 1% of the total gross intrastate operating revenues of all regulated utilities. The PSC must issue a statement of the assessment amount to each utility by July 1st of each year, which the utility may pay in full by July 15th or in four equal quarterly installments.

The payments are to be deposited in the Public Counsel Fund, created in the act, and may only be used to pay the expenses of the OPC. Any balance remaining in the fund at the end of the fiscal year must be proportionately credited to the next year's assessments.

The act does not grant authority to the PSC to determine how the OPC estimates its expenses or how the OPC will spend the assessments collected from the utilities.

By March 31st of each year, each regulated utility must file a statement with the PSC of its gross intrastate operating revenues for the preceding calendar year.

This section is identical to the same section in SB 869 (2012).

SECTION 393.135 - EARLY SITE PERMIT COST RECOVERY

If an electric company obtains an Early Site Permit from the U.S. Nuclear Regulatory Commission (NRC), the PSC must allow the company to recover from its ratepayers up to $45 million of prudently-incurred expenditures spent by the company to obtain the permit. The company may recover such expenditures from its ratepayers through rates and charges over a period not to exceed 6 years. The company may begin the cost recovery on the effective date of tariffs approved by the PSC at the company's first general rate proceeding following the NRC's issuance of the permit. Cost recovery is limited to only costs that are prudently incurred; if a cost is challenged, the company has the burden of proof to show the cost was prudent. In any challenge to the prudency of the company's decision to obtain an Early Site Permit, the burden of proof is on the party raising the challenge.

If an electric company has recovered costs from its ratepayers for an Early Site Permit but the company's interest in the Early Site Permit is subsequently sold or transferred, the company must refund its ratepayers up to the amount that the company collected from the ratepayers for the permit, plus interest. The PSC may award up to 25% of any excess profits above the amount paid by ratepayers to the company.

The act creates the Governor's Task Force on Electrical Generation Options, which shall review energy generation options to include other options in addition to large baseload nuclear plants. The act specifies representation on the task force. The task force must issue its report by September 30, 2012.

This section is identical to the same section in SB 869 (2012).

SECTION 393.150 - TEMPORARY RATE ADJUSTMENTS

The act requires the PSC to authorize temporary rate adjustments in any order it issues after concluding a rate case. The temporary rate adjustment covers the time period between when the utility's rates are trued-up in the rate case and the date the PSC's new rates as determined in the order go into effect. The temporary rates must be implemented over a one-year period. If the effect of the PSC's order is to lower the utility's rates, then the temporary rate adjustment will reflect an overcollection from the utility's customers during that time period. If the effect of the PSC's order is to raise the utility's rates, the temporary rate adjustment will reflect an undercollection from the customers during that timeframe. The effect of the temporary rates must be part of the PSC's calculation for setting the utility's new rates. The act additionally limits the PSC from holding more than rate case in a 12-month period for gas, electric, water, and sewer utilities.

This section is identical to the same section in SB 902 (2012).

SECTIONS 393.1025 to 393.1034 - RENEWABLE ENERGY STANDARD

The act modifies the state Renewable Energy Standard (RES), which prescribes certain percentages of electricity sales by electric companies that must come from renewable energy sources.

The act modifies the definitions section by adding definitions for "biomass" and "professional forester" and modifying the definition of "renewable energy resources."

The act removes the 2% portfolio requirement for the years 2011 to 2013, increases the minimum requirement from 5% to 7% for years 2014 to 2017, and increases the minimum requirement from 10% to 12% for years 2018 to 2020.

Renewable energy credits (RECs) for energy produced anywhere in the continental U.S. may be used to meet the RES through calendar year 2016, but after that, only RECs associated with energy generated in Missouri or any of its bordering states may be used.

The act provides an exemption to the RES if the utility's cost of compliance exceeds the total amount allowed to be recovered from ratepayers for the RES. The costs to the utility for renewable energy resources that it would have acquired or contracted to use regardless of the RES are not to be included in the cost calculation of compliance with the RES.

The act allows the utility to recover the costs to comply with the RES from its customers up to a maximum amount, which is the lower of either: an additional 1% of the utility's base rate portion of its revenue requirement; or caps per month of $.93 for residential customers, $3.42 for nonresidential customers that use 100 kW or less, $46.58 for nonresidential customers that use more than 100 kW but less than 5,000 kW, and $466 for nonresidential customers that use more than 5,000 kW. Cost recovery may begin in calendar year 2013. Any overrecovery or underrecovery of actual costs related to RES compliance must either be returned to, or collected from, ratepayers during the following calendar year.

The act describes how a utility should calculate its gross and net costs of compliance with the RES. Net cost is determined by subtracting from the gross cost the total value of the energy produced from the renewable energy resources, where the total value of the energy is the amount of energy multiplied by the time-differentiated kilowatt-hour price as set in the utility's rate tariffs.

Under current law, the monetary penalty for non-compliance with the RES is at least twice the average market value of RECs. The act modifies this amount to at least twice the per kilowatt-hour price for the utility.

The act modifies the solar rebate provisions. Solar rebates must be available to customers who install and operate solar electric systems on their property after 2012, instead of 2009. The rebate must be $2 per watt in the year 2013, with the amount of the rebate reduced by 25 cents each year thereafter. No solar rebates are required to be offered after the year 2020. Customers who receive solar rebates must transfer all rights, title, and interest in any RECs associated with the solar energy to the utility for ten years.

The act specifies that an energy-generating facility that is in compliance with all federal, state, and local environmental laws and regulations shall not be deemed to cause undue adverse environmental impacts for purposes of being certified by the Department of Natural Resources for the RES. Any use of wood feedstocks certified for the RES must comply with certain environmental standards listed in the act.

The act requires electric companies to be able to recover RES costs from their ratepayers, regardless of a previous decision made by the PSC as specified.

These sections are similar to HB 1487 (2012).

SECTION 393.1039 - BIOMASS ENERGY PROJECTS

The Department of Natural Resources must charge and collect from electric companies an assessment to fund the Department's costs to develop biomass energy projects. Revenue from the assessment will be deposited in the Agricultural Energy Fund, which is created in the act.

SECTION 393.1075 - MISSOURI ENERGY EFFICIENCY INVESTMENT ACT

The act modifies the Missouri Energy Efficiency Investment Act by removing the requirement that the PSC must promulgate a rule each time it approves a rate design modification for a demand-side program.

SECTION 620.010 - OFFICE OF PUBLIC COUNSEL

The act removes the requirement that the Office of Public Counsel is funded by general revenue.

The act contains an emergency clause.

This act contains provisions similar to provisions contained in SS/SCS/HB 462 (2011), SB 321 (2011), and SB 406 (2011).

ERIKA JAQUES