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SENATE BILL NO. 408
INTRODUCED BY J. ELLINGSON
A BILL FOR AN ACT ENTITLED: "AN ACT REQUIRING THAT THE PUBLIC SERVICE COMMISSION CONTINUE TO REGULATE ELECTRICITY SUPPLY FOR SMALL CUSTOMERS IF WORKABLE COMPETITION DOES NOT EXIST; AMENDING SECTIONS 69-8-201, 69-8-210, AND 69-8-403, MCA; AND PROVIDING AN IMMEDIATE EFFECTIVE DATE."
BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF MONTANA:
Section 1. Section 69-8-201, MCA, is amended to read:
"69-8-201. Public utility -- transition to customer choice -- waiver. (1) A public utility shall, except as provided in this section, adhere to the following deadlines:
(a) On or before July 1, 1998, all customers with individual loads greater than 1,000 kilowatts and for loads of the same customer with individual loads at a meter greater than 300 kilowatts that aggregate to 1,000 kilowatts or greater must have the opportunity to choose an electricity supplier.
(b) Subject to subsection (2)
, and as soon as is administratively feasible but before July 1, 2002, all other public utility
customers must have the opportunity to choose an electricity supplier.
(2) (a) Except as provided for in subsection (3), the commission may determine that additional time is necessary for
customers identified in subsection (1)(b)
; however, the implementation of full customer choice may not be delayed beyond
July 1, 2004.
(b) A determination by the commission that additional time is necessary for customers identified in subsection (1)(b)
customers must be made at least 60 days in advance of the scheduled date and must be based on one or more of the
(i) implementation would not be administratively feasible;
(ii) implementation would materially affect the reliability of the electric system; or
Montana customers or electricity suppliers would be disadvantaged due to lack of a competitive electricity supply
market workable competition for electricity supplies does not exist.
(3) Except as provided in 69-5-101, 69-5-102, 69-5-104 through 69-5-112,
and 69-8-402, and subsection (1)(b) of this
section,a public utility currently doing business in Montana as part of a single integrated multistate operation, no portion of
which lies within the basin of the Columbia River, may:
(a) defer compliance with this chapter until a time that the public utility can reasonably implement customer choice in the state of the public utility's primary service territory, except that the public utility shall file a transition plan pursuant to 69-8-202 to provide transition to customer choice on or before July 1, 2002, and must have completed the transition period to customer choice by July 1, 2006; and
(b) petition the commission to delay the public utility's transition plan filing until July 1, 2004.
(4) Upon a request from a public utility with fewer than 50 customers, the commission shall waive compliance with the requirements of 69-8-104, 69-8-202 through 69-8-204, 69-8-208 through 69-8-211, 69-8-402, and this section."
Section 2. Section 69-8-210, MCA, is amended to read:
"69-8-210. Public utilities -- electricity supply. (1) On the effective date of a commission order implementing a public utility's transition plan pursuant to 69-8-202, the public utility shall remove its generation assets from the rate base.
(2) During the transition period, the commission may establish cost-based prices for
electricity supply service for
customers that do not have a choice of electricity supply service or that have not yet chosen an electricity supplier those
customers identified in 69-8-201(1)(b).
(3) If the transition period is extended,
then the customers' distribution services provider shall: (a) extend any cost-based contract with the distribution services provider's affiliate supplier for a term not more than 3
years; or (b) purchase electricity from the market; and (c) use a mechanism that recovers electricity supply costs in rates to ensure that those costs are fully recovered public
utility shall continue to offer electricity supply service to those customers identified in 69-8-201(1)(b) at rates, terms, and
conditions approved by the commission.
(4) If a public utility intends to be an electricity supplier through an unregulated division, then the public utility must be licensed as an electricity supplier pursuant to 69-8-404."
Section 3. Section 69-8-403, MCA, is amended to read:
"69-8-403. Commission authority -- rulemaking authority. (1) (a) Beginning on the effective date of a commission
order regarding a public utility's transition plan, the commission shall regulate the public utility's retail transmission and
distribution services within the state of Montana
, as provided in this chapter, and may not regulate the price of electricity
supply except as provided in subsection (1)(b).
(b) The commission shall continue to regulate rates for electricity supply
may be procured during the transition period
by the distribution function of by a public utility for those customers identified in 69-8-201(1)(b) that have not chosen an
electricity supplier or for those customers that have not yet been assigned an electricity supplier until the commission
determines that workable competition exists. During the transition period, those procurements may include a cost-based
contract from a supply affiliate or an unregulated division.
(2) If the transition period is extended for certain customers because the commission finds that workable competition in
the electricity supply market does not exist,
then the commission shall continue to regulate the provision of electricity
supply by distribution services providers in accordance with 69-8-210 and shall continue to regulate rates for electricity
supply for customers identified in 69-8-201(1)(b) until workable competition exists.
(3) The commission shall decide if there is workable competition in the electricity supply market by determining whether competition is sufficient to inhibit monopoly pricing or anticompetitive price leadership. In reaching a decision, the commission may not rely solely on market share estimates.
(4) The commission shall license electricity suppliers and enforce licensing provisions pursuant to 69-8-404.
(5) The commission shall promulgate rules that identify the licensees and ensure that the offered electricity supply is provided as offered and is adequate in terms of quality, safety, and reliability.
(6) The commission shall establish just and reasonable rates through established ratemaking principles for public utility distribution and transmission services and shall regulate these services. The commission may approve rates and charges for electricity distribution and transmission services based on alternative forms of ratemaking such as performance-based ratemaking, on a demonstration by the public utility that the alternative method complies with this chapter, and on the public utility's transition plan.
(7) The commission shall certify that a cooperative utility has adopted a transition plan that complies with this chapter. A cooperative utility's transition plan is considered certified 60 days after the cooperative utility files for certification.
(8) The commission shall promulgate rules that protect consumers, distribution services providers, and electricity suppliers from anticompetitive and abusive practices.
(9) In addition to promulgating rules expressly provided for in this chapter, the commission may promulgate any other rules necessary to carry out the provision of this chapter.
(10) This chapter does not give the commission the authority to:
(a) regulate cooperative utilities in any manner other than reviewing certification filings for compliance with this chapter; or
(b) compel any change to a cooperative utility's certification filing made pursuant to this chapter."
NEW SECTION. Section 4. Effective date. [This act] is effective on passage and approval.
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Latest Version of SB 408 (SB0408.01)
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