S.B. 152

1

ELECTRIC ENERGY EFFICIENCY AND
2 CONSERVATION TARIFF
3 2002 GENERAL SESSION
4 STATE OF UTAH
5 Sponsor: Leonard M. Blackham
6 This act modifies Public Utilities provisions to establish a process for Public Service
7 Commission approval of a tariff to pay for activities or programs designed to promote
8 electric energy efficiency or conservation or more efficient management of electric energy
9 loads. The act provides for a hearing on the proposed tariff and authorizes the commission
10 to allow a customer credit against tariff charges for implementing energy efficiency
11 measures. The act makes coordinating and technical changes.
12 This act affects sections of Utah Code Annotated 1953 as follows:
13 AMENDS:
14 54-7-12, as last amended by Chapter 219, Laws of Utah 2001
15 ENACTS:
16 54-7-12.8, Utah Code Annotated 1953
17 Be it enacted by the Legislature of the state of Utah:
18 Section 1. Section 54-7-12 is amended to read:
19 54-7-12. Rate increase or decrease -- Procedure -- Effective dates -- Electrical or
20 telephone cooperative.
21 (1) As used in this section:
22 (a) "Rate decrease" means:
23 (i) any direct decrease in a rate, fare, toll, rental, or other charge of a public utility; or
24 (ii) any modification of a classification, contract, practice, or rule that decreases a rate,
25 fare, toll, rental, or other charge of a public utility.
26 (b) "Rate increase"[ ]:
27 (i) means:

28 [(i)] (A) any direct increase in a rate, fare, toll, rental, or other charge of a public utility;
29 or
30 [(ii)] (B) any modification of a classification, contract, practice, or rule that increases a
31 rate, fare, toll, rental, or other charge of a public utility[.]; and
32 (ii) does not include a tariff under Section 54-7-12.8 .
33 (2) (a) Any public utility or other party that proposes to increase or decrease rates shall file
34 appropriate schedules with the commission setting forth the proposed rate increase or decrease.
35 (b) The commission shall, after reasonable notice, hold a hearing to determine whether the
36 proposed rate increase or decrease, or some other rate increase or decrease, is just and reasonable.
37 If a rate decrease is proposed by a public utility, the commission may waive a hearing unless it
38 seeks to suspend, alter, or modify the rate decrease.
39 (c) Except as otherwise provided in Subsections (3) and (4), a proposed rate increase or
40 decrease is not effective until after completion of the hearing and issuance of a final order by the
41 commission concerning the proposed increase or decrease.
42 (3) The following rules apply to the implementation of any proposed rate increase or
43 decrease filed by a utility or proposed by any other party and to the implementation of any other
44 increase or decrease in lieu of that proposed by a utility or other party that is determined to be just
45 and reasonable by the commission.
46 (a) On its own initiative or in response to an application by a public utility or other party,
47 the commission, after a hearing, may allow any proposed rate increase or decrease, or a reasonable
48 part of the rate increase or decrease, to take effect, subject to the commission's right to order a
49 refund or surcharge, upon the filing of the utility's schedules or at any time during the pendency
50 of the commission's hearing proceedings. The evidence presented in the hearing held pursuant to
51 this subsection need not encompass all issues that may be considered in a rate case hearing held
52 pursuant to Subsection (2)(b), but shall establish an adequate prima facie showing that the interim
53 rate increase or decrease is justified.
54 (b) (i) If the commission completes a hearing concerning a utility's revenue requirement
55 before the expiration of 240 days from the date the rate increase or decrease proposal is filed, the
56 commission may issue a final order within that period establishing the utility's revenue requirement
57 and fixing the utility's interim allowable rates before the commission determines the allocation of
58 the increase or decrease among categories of customers and classes of service.

59 (ii) If the commission in the commission's final order on a utility's revenue requirement
60 finds that the interim increase order under Subsection (3)(a) exceeds the increase finally ordered,
61 the commission shall order the utility to refund the excess to customers. If the commission in the
62 commission's final order on a utility's revenue requirement finds that the interim decrease order
63 under Subsection (3)(a) exceeds the decrease finally ordered, the commission shall order a
64 surcharge to customers to recover the excess decrease.
65 (c) If the commission fails to enter the commission's order granting or revising a revenue
66 increase within 240 days after the utility's schedules are filed, the rate increase proposed by the
67 utility is final and the commission may not order a refund of any amount already collected by the
68 utility under its filed rate increase.
69 (d) (i) When a public utility files a proposed rate increase based upon an increased cost to
70 the utility for fuel or energy purchased or obtained from independent contractors, other
71 independent suppliers, or any supplier whose prices are regulated by a governmental agency, the
72 commission shall issue a tentative order with respect to the proposed increase within ten days after
73 the proposal is filed, unless it issues a final order with respect to the rate increase within 20 days
74 after the proposal is filed.
75 (ii) The commission shall hold a public hearing within 30 days after it issues the tentative
76 order to determine if the proposed rate increase is just and reasonable.
77 (4) (a) Notwithstanding any other provisions of this title, any schedule, classification,
78 practice, or rule filed by a public utility with the commission that does not result in any rate
79 increase shall take effect 30 days after the date of filing or within any lesser time the commission
80 may grant, subject to its authority after a hearing to suspend, alter, or modify that schedule,
81 classification, practice, or rule.
82 (b) When the commission suspends a schedule, classification, practice, or rule, the
83 commission shall hold a hearing on the schedule, classification, practice, or rule before issuing its
84 final order.
85 (c) For purposes of this Subsection (4), any schedule, classification, practice, or rule that
86 introduces a service or product not previously offered may not result in a rate increase.
87 (5) (a) Notwithstanding any other provision of this title, whenever a public utility files with
88 the commission any schedule, classification, practice, or rule that does not result in an increase in
89 any rate, fare, toll, rental, or charge, the schedule, classification, practice, or rule shall take effect

90 30 days after the date of filing or at any earlier time the commission may grant, subject to the
91 authority of the commission, after a hearing, to suspend, alter, or modify the schedule,
92 classification, practice, or rule.
93 (b) (i) Notwithstanding any other provision of this title, whenever a public utility files with
94 the commission a request for an increase in rates, fares, tolls, rentals, or charges based solely upon
95 cost increases to the public utility of fuel supplied by an independent contractor or independent
96 source of supply, the requested increase shall take effect ten days after the filing of the request with
97 the commission or at any earlier time after the filing of the request as the commission may by order
98 permit.
99 (ii) The commission shall order the increase to take effect only after a showing has been
100 made by the public utility to the commission that the increase is justified.
101 (iii) The commission may, after a hearing, suspend, alter, or modify the increase.
102 (6) This section does not apply to any rate changes of an electrical or telephone
103 cooperative that meets all of the requirements of this Subsection (6).
104 (a) (i) The cooperative is organized for the purpose of either distributing electricity or
105 providing telecommunication services to its members and the public at cost.
106 (ii) "At cost" includes interest costs and a reasonable rate of return as determined by the
107 cooperative's board of directors.
108 (b) The cooperative's board of directors and any appropriate agency of the federal
109 government have approved the rate increase or other rate change and all necessary tariff revisions
110 reflecting the increased rate or rate change.
111 (c) Before implementing any rate increases, the cooperative has held a public meeting for
112 all its customers and members. The cooperative shall mail a notice of the meeting to all of the
113 cooperative's customers and members not less than ten days prior to the date that the meeting is
114 held.
115 (d) The cooperative has filed its tariff revisions reflecting the rate increase or other rate
116 change with the commission, who shall make the tariffs available for public inspection.
117 (7) Notwithstanding Subsections (2) and (3), the procedures for implementing a proposed
118 rate increase by a telephone corporation having less than 30,000 subscriber access lines in the state
119 are provided in this Subsection (7).
120 (a) (i) The proposed rate increase by a telephone corporation subject to this Subsection (7)

121 may become effective on the day the telephone corporation files with the commission the proposed
122 tariff revisions and necessary information to support a determination by the commission that the
123 proposed rate increase is just and reasonable.
124 (ii) The telephone corporation shall notify the commission and all potentially affected
125 access line subscribers of the proposed rate increase 30 days before filing the proposed rate
126 increase or change.
127 (b) (i) The commission may investigate whether the proposed rate increase is just and
128 reasonable.
129 (ii) If the commission determines, after notice and hearing, that the rate increase is unjust
130 or unreasonable in whole or in part, the commission may establish the rates, charges, or
131 classifications that the commission finds to be just and reasonable.
132 (c) The commission shall investigate and hold a hearing to determine whether any
133 proposed rate increase is just and reasonable if 10% or more of the telephone corporation's
134 potentially affected access line subscribers file a request for agency action requesting an
135 investigation and hearing.
136 Section 2. Section 54-7-12.8 is enacted to read:
137 54-7-12.8. Electric energy efficiency and conservation tariff.
138 (1) As used in this section, "demand side management" means activities or programs that
139 promote electric energy efficiency or conservation or more efficient management of electric energy
140 loads.
141 (2) As provided in this section, the commission may approve a tariff under which an
142 electrical corporation includes a line item charge on its customers' bills to recover costs incurred
143 by the electrical corporation for demand side management.
144 (3) Each electrical corporation proposing a tariff under this section shall, before submitting
145 the tariff to the commission for approval, seek and receive input from:
146 (a) the Division of Public Utilities;
147 (b) the Committee of Consumer Services; and
148 (c) other interested parties.
149 (4) Before approving a tariff under this section, the commission shall hold a hearing if:
150 (a) requested in writing by the electrical corporation, a customer of the electrical
151 corporation, or any other interested party within 15 days after the tariff filing; or

152 (b) the commission determines that a hearing is appropriate.
153 (5) The commission may approve a tariff under this section either with or without a
154 provision allowing an end-use customer to receive a credit against the charges imposed under the
155 tariff for electric energy efficiency measures that:
156 (a) the customer implements at the customer's expense; and
157 (b) qualify for the credit under criteria established by the Utah State Energy Office.
158 (6) In approving a tariff under this section, the commission may impose whatever
159 conditions or limits it considers appropriate, including a maximum annual cost.
160 (7) Unless otherwise ordered by the commission, each tariff under this section approved
161 by the commission shall take effect no sooner than 30 days after the electrical corporation files the
162 tariff with the commission.




Legislative Review Note
as of 1-30-02 6:46 AM

A limited legal review of this legislation raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel