COMMITTEE ON GOVERNMENT
HOUSE OF REPRESENTATIVES AMENDMENTS TO H.B. 2701
(Reference to printed bill)
Page 1, between lines 20 and 21, insert:
"1. "Electric Cooperative" means a member-owned nonprofit cooperative corporation that distributes electricity at retail to its members."
Renumber to conform
Line 25, strike "and" insert "or"
Line 34, strike "and private"; after "entities" insert ", public service corporations and electric cooperatives"
Page 2, between lines 2 and 3, insert:
"3. Electric cooperatives shall develop, implement and annually update a plan for deriving a percentage of the electricity used by their retail members from renewable energy sources."
Renumber to conform
Between lines 7 and 8, insert:
"(b) Rebates for combined heat and power with a total fuel efficiency of sixty per cent or greater on a lower heating value basis."
Reletter to conform
Line 13, strike "and" insert a comma; after "corporations" insert "and electric cooperatives"
Line 15, strike "or" insert a comma; after "corporation's" insert "or cooperative's"
Line 19, strike "and"
Line 22, strike the comma insert "and the board of directors of each electric cooperative shall enforce the standards prescribed by this section with respect to the cooperative"
After line 28, insert:
"Sec. 2. Section 40-202, Arizona Revised Statutes, is amended to read:
40-202. Supervising and regulating public service corporations; telecommunications promotion; competitive electricity market; rules; duty to comply; exemptions for electric generation; unlawful practice
A. The commission may supervise and regulate every public service corporation in the state and do all things, whether specifically designated in this title or in addition thereto, necessary and convenient in the exercise of that power and jurisdiction. In supervising and regulating long‑distance telecommunications corporations, the commission shall encourage competition and growth in the telecommunications industry and promote economic development and investment in new telecommunications technologies, infrastructure and services. In furtherance of this policy, the commission shall establish procedures and standards for identifying and regulating competitive long‑distance telecommunications markets. When the commission determines that a long‑distance telecommunications market is competitive, it shall establish appropriate supervisory and regulatory treatment for competitive long‑distance telecommunications markets as distinguished from noncompetitive telecommunications markets. In imposing any assessments or other charges on mobile telecommunications service providers, the commission shall comply with the requirements of the mobile telecommunications sourcing act (P.L. 106‑252; 114 Stat. 626; 4 United States Code sections 116 through 126).
B. It is the public policy of this state that a competitive market shall exist in the sale of electric generation service. In order to transition to competition for electric generation service, the commission's authority is confirmed to:
1. Open the service territories of public service corporations, except foreign nonprofit, member owned cooperative corporations, to competitive access by other electricity suppliers or providers of other services not later than December 31, 1998 for at least twenty per cent of their 1995 retail load, at least fifteen per cent of which shall be reserved for customers in the residential customer class, and open their entire service territory to competition not later than December 31, 2000.
2. Establish reasonable requirements for certificating and regulating electricity suppliers that are public service corporations.
3. Maintain the current service territories of public service corporations and prohibit a public service corporation from providing electric distribution service in the service territories of other electric distribution utilities in this state.
4. Require an electric distribution utility that is a public service corporation and that has been granted a service territory through a certificate of convenience and necessity or a contract and agreement among utilities to provide other services for the service territory that the electric distribution utility serves as follows:
(a) Beginning on December 31, 1998 through December 31, 2000, billing and collections services shall be provided on a competitive basis for those retail electric customers with loads of one megawatt and above that have competitive electric generation service. After December 31, 2000, billing and collections services shall be provided on a competitive basis for all retail electric customers that have competitive electric generation service.
(b) Beginning on December 31, 1998 through December 31, 2000, metering shall be provided on a competitive basis for those retail electric customers with loads of one megawatt and above that have competitive electric generation service. After December 31, 2000, metering shall be provided on a competitive basis for all retail electric customers that have competitive electric generation service. All meters shall meet or exceed existing standards for safety, reliability and accuracy.
(c) By December 31, 1998 through December 31, 2000, meter reading shall be provided on a competitive basis for those retail electric customers with loads of one megawatt and above that have competitive electric generation service. After December 31, 2000, meter reading shall be provided on a competitive basis for all retail electric customers that have competitive electric generation service.
5. Require the electric distribution utility that is a public service corporation to act as the supplier of last resort for electric generation service for every retail electric customer within its electric distribution service territory whose annual usage is one hundred thousand kilowatt hours or less if other electricity suppliers are unwilling or are unable to supply electric generation service and whose electric generation service has been discontinued through no fault of the retail electric customer.
6. Provide for the recovery of just and reasonable costs incurred by the electric distribution utilities that are public service corporations for supplying electric generation service under paragraph 5 of this subsection through a distribution charge on retail customers whose annual usage is one hundred thousand kilowatt hours or less.
7. Investigate complaints regarding the subsidization of competitive services by any regulated rate or charge for any noncompetitive electric service and impose appropriate sanctions for any such subsidization.
8. Except as provided for the recovery of stranded costs, including costs associated with employee severance incurred as a direct result of competition among electric suppliers, as ordered by the commission, not consider the profits or losses associated with electric generation service when regulating electric distribution service.
C. In supervising and regulating public service corporations, the commission's authority is confirmed to adopt rules to:
1. Protect the public against deceptive, unfair and abusive business practices, practices related to deposit requirements and reconnection fees, intrusive and abusive marketing, deceptive or untrue advertising practices and practices prohibited under subsection H of this section.
2. Prohibit a public service corporation that forms an affiliate for the purposes of providing services that require a licensed contractor or that has employees perform these services, including but not limited to electrical, heating, ventilation, air conditioning or plumbing or construction services, from advertising these services in their its billing statement or in other mailings done by the electric distribution utility.
3. Provide that a separate authorization pursuant to paragraph 4 of this subsection to change electricity supplier and plain language in advertising and billing using uniform words and phrases that have the same meanings so that customers can make accurate comparisons.
4. Provide that a separate written and dated authorization is required for a change in a retail electricity supplier subject to the following:
(a) The authorization shall not contain any inducements.
(b) The authorization shall be in legible print with clear and plain language confirming the rates, terms, conditions and nature of the service to be provided.
(c) The authorization shall not state or suggest that the customer take action to retain the customer's current electricity supplier.
(d) An electricity supplier that submits or executes a change in a retail electricity customer's electricity supplier in violation of this paragraph shall refund to the retail electricity customer the entire amount of the customer's electricity charges attributable to electric generation service from the electricity supplier for three months, or the period of the unauthorized service, whichever is less.
(e) The authorization shall be in the same language as any promotional or inducement materials provided to the retail electric customer.
(f) No box or container may be used to collect entries for sweepstakes or a contest that, at the same time, is used to collect authorization by a retail electric customer to change the customer's electricity supplier or to subscribe to other services.
5. Provide that, notwithstanding any other law, customer information, account information and related proprietary information are confidential unless specifically waived by the customer in writing.
6. Ensure that public service corporations that employ the services of a contractor for interior household energy service, either directly or through any affiliate, require the contractors and subcontractors to be licensed by the registrar of contractors and shall comply with all municipal permit and inspection standards and applicable life safety codes. For the purposes of this paragraph, "contractor" has the same meaning prescribed in section 32‑1101.
7. Permit the aggregation of loads by multiple customers.
D. In supervising and regulating public service corporations, it is the public policy of this state that the most effective manner of establishing just and reasonable rates for electricity is to permit electric generation service prices to be established in a competitive market.
E. The commission shall order on a nondiscriminatory basis that public service corporations open their distribution territories to competition by public power entities to the same extent and under the same terms and conditions as authorized electricity suppliers are granted access through commission rules or orders.
F. Except as provided in subsection G of this section, during the initial construction of a residential structure, electric and natural gas facilities at a minimum shall be installed in and to the structure in a manner that provides the retail energy consumer ultimately residing in the structure with the capability to choose between electricity and natural gas as an energy source for each appliance application.
G. A residential structure may be constructed without the installation of any particular facilities if:
1. The structure is not located within the service territory of a public service corporation certificated to furnish the associated energy service.
2. Unless mandated otherwise by law or governmental regulation, the public service corporation certificated to furnish the associated energy notifies the contractor or owner that the extension of the facilities to the structure is not economically feasible.
3. The public service corporation certificated to furnish a particular energy service and the owner or contractor agree that the extension of the facilities to the subdivision, to the structure or to any appliance application would not be economically feasible or would otherwise be inappropriate. In this case, the parties may agree to install no facilities in the subdivision, to install service to any or all residential structures without providing service to any appliance application or to install facilities to some but not all appliance applications.
H. Unless mandated by law or a generally accepted industry code, a person or entity, including municipal corporations and political subdivisions, shall not engage in any practice that interferes with the opportunity to have electric and natural gas facilities at a minimum installed in and to an existing residential structure in a manner that provides the retail energy consumer ultimately residing in the structure and all subsequent retail energy consumers residing in the structure with the capability to choose between electricity and natural gas as an energy source for each appliance application. This subsection does not apply to reasonable sales and marketing activities.
I. If a trench is provided by a contractor or a property owner for the purpose of having utility facilities installed to a residential structure, electric and natural gas facilities at a minimum shall be permitted to occupy the trench if the installation of the facilities is completed in compliance with generally accepted industry safety codes applicable to the installation. Except in the case of underground conversion service areas provided for in sections 40‑341 through 40‑355 and improvement districts for underground utility facilities provided for in section 48‑620, if the contractor or property owner conditions occupancy in a trench on a reimbursement of costs associated with providing the trench, the contractor or property owner may require an occupant to pay a pro rata share of the costs associated with providing the trench. A public service corporation may use as a credit against the payment money paid through the public service corporation's conduit or other reimbursement programs.
J. Before initiating a complaint with a public service corporation or the commission, the parties to a dispute arising under subsections F through I of this section shall meet and in good faith attempt to resolve the dispute through an informal dispute resolution process. Compliance with subsections F through I of this section does not require inspection or enforcement by a city, town or county.
K. After facilities have been installed initially in accordance with subsection F of this section, the public service corporation, the homeowner, the home builder or the contractor is not responsible or liable for any subsequent modification to the number of initially installed facilities.
L. A public service corporation shall comply with every order, decision, rule or regulation made by the commission in any matter relating to or affecting its business as a public service corporation and shall do everything necessary to secure compliance with and observance of every such order, decision, rule or regulation.
M. The commission by rule or order may exempt or partially exempt any competitive service of any public service corporation from the application of section 40‑203, section 40‑204, subsections A and B and sections 40‑248, 40‑250, 40‑251, 40‑285, 40‑301, 40‑302, 40‑303, 40‑321, 40‑322, 40‑331, 40‑332, 40‑334, 40‑365, 40‑366, 40‑367, 40‑374 and 40‑401.
N. The provisions of subsection B, paragraphs 3 and 5 of this section are subject to legislative review by the auditor general in 2008.
O. The provisions of subsection B, paragraph 4 of this section are subject to sunset review by the auditor general in 2003.
P. Failure to comply with the rules or procedures adopted pursuant to subsections B and C of this section is an unlawful practice pursuant to section 44‑1522. The attorney general may investigate and take appropriate action as prescribed by title 44, chapter 10, article 7.
Q. Notwithstanding any other provision of this section, the legislature has exclusive authority to determine renewable energy policy for this state. This section does not authorize the commission to adopt electric utility renewable energy standards.
Sec. 3. Section 40-321, Arizona Revised Statutes, is amended to read:
40-321. Power of commission to determine adequacy of service rendered by public service corporation; enforcement by order or regulation; duty of compliance by corporation; surety; utility surety fund
A. When the commission finds that the equipment, appliances, facilities or service of any public service corporation, or the methods of manufacture, distribution, transmission, storage or supply employed by it, are unjust, unreasonable, unsafe, improper, inadequate or insufficient, the commission shall determine what is just, reasonable, safe, proper, adequate or sufficient, and shall enforce its determination by order or regulation.
B. The commission shall prescribe regulations for the performance of any service or the furnishing of any commodity, and upon proper demand and tender of rates, the public service corporation shall furnish the commodity or render the service within the time and upon the conditions prescribed.
C. If, after notice and an opportunity to be heard, the commission finds that a public service corporation is in default of the terms and conditions of an order of the commission that requires a performance bond, irrevocable letter of credit or other surety, and the commission exercises its rights under the bond, letter or other surety, the commission shall deposit all monies received as a result of exercising the rights in the utility surety fund established by subsection D of this section.
D. The utility surety fund is established consisting of monies received by the commission pursuant to subsection C of this section. Monies in the utility surety fund shall be administered by the commission for the benefit of the customers of the public service corporation who have incurred a loss of services or commodities or for deposit support pursuant to this section. Monies in the fund are continuously appropriated to the commission and do not revert to the state general fund pursuant to section 35‑190.
E. Notwithstanding any other provision of this section, the legislature has exclusive authority to determine renewable energy policy for this state. This section does not authorize the commission to adopt electric utility renewable energy standards.
Sec. 4. Section 40-322, Arizona Revised Statutes, is amended to read:
40-322. Regulation of public service corporations; standards of service; measurement standards; inspections by commission
A. The commission may:
1. Ascertain and set just and reasonable standards, classifications, regulations, practices, measurements or service to be furnished and followed by public service corporations other than a railroad.
2. Ascertain and fix adequate and serviceable standards for the measurement of quantity, quality, pressure, initial voltage or other condition pertaining to the supply of the product, commodity or service furnished by such public service corporation.
3. Prescribe reasonable regulations for the examination and testing of the product, commodity or service and for the measurement thereof.
4. Establish reasonable rules, regulations, specifications and standards to secure the accuracy of all meters and appliances for measurements.
5. Provide for the examination and testing of any and all appliances used for measurement of any product, commodity or service of any such corporation.
B. The commission, its officers and employees may enter upon any premises occupied by a public service corporation, for the purpose of making the examinations and tests and exercising any of the other powers provided for in this article, and may set up and use on the premises any apparatus and appliances necessary therefor. The agents and employees of the public service corporation may be present at the making of the examinations and tests.
C. Any consumer or user of any product, commodity or service of a public service corporation may have any appliance used in the measurement thereof tested upon paying the fees fixed by the commission, the fee to be paid by the consumer or user at the time of his request, but to be paid by the corporation and repaid to the consumer or user if the appliance is found defective or operates to the disadvantage of the consumer or user.
D. Notwithstanding any other provision of this section, the legislature has exclusive authority to determine renewable energy policy for this state. This section does not authorize the commission to adopt electric utility renewable energy standards.
Sec. 5. Section 40-331, Arizona Revised Statutes, is amended to read:
40-331. Power of commission to order additions, improvements or changes in plant of public service corporations; additions or changes made jointly
A. When the commission finds that additions or improvements to or changes in the existing plant or physical properties of a public service corporation ought reasonably to be made, or that a new structure or structures should be erected, to promote the security or convenience of its employees or the public, the commission shall make and serve an order directing that such changes be made or such structure be erected in the manner and within the time specified in the order. If the commission orders erection of a new structure, it may also fix the site thereof.
B. If any such changes require joint action by two or more public service corporations, the commission shall notify the corporations thereof and that the changes shall be made at their joint cost, whereupon the corporations shall have such reasonable time as the commission grants within which to agree upon the division of cost. If at the expiration of the time the corporations fail to file with the commission a statement that an agreement is made for a division or apportionment of the cost or expense of the change, the commission may make an order fixing the proportion of the cost or expense to be borne by each corporation, and the manner of payment.
C. Notwithstanding any other provision of this section, the legislature has exclusive authority to determine renewable energy policy for this state. This section does not authorize the commission to adopt electric utility renewable energy standards.
Sec. 6. Section 40-361, Arizona Revised Statutes, is amended to read:
40-361. Charges by public service corporations required to be just and reasonable; service and facilities required to be adequate, efficient and reasonable; rules and regulations relating to charges or service required to be just and reasonable
A. Charges demanded or received by a public service corporation for any commodity or service shall be just and reasonable. Every unjust or unreasonable charge demanded or received is prohibited and unlawful.
B. Every public service corporation shall furnish and maintain such service, equipment and facilities as will promote the safety, health, comfort and convenience of its patrons, employees and the public, and as will be in all respects adequate, efficient and reasonable.
C. All rules and regulations made by a public service corporation affecting or pertaining to its charges or service to the public shall be just and reasonable.
D. Notwithstanding any other provision of this section, the legislature has exclusive authority to determine renewable energy policy for this state. This section does not authorize the commission to adopt electric utility renewable energy standards."
Amend title to conform