Citations Affected: IC 8-1.
Synopsis: Various utility matters. Allows the utility regulatory commission (IURC) to add to the value of an energy utility's property for ratemaking purposes the value of certain qualified property constructed by the utility to comply with state or federal mandates. Allows an energy utility to recover through a retail rate adjustment mechanism governmentally mandated costs incurred in providing retail energy service. Provides that a petition by a public or municipally owned electric utility or a rural electric membership corporation (REMC) for a fuel cost charge includes the costs of purchased electricity. Allows a public utility providing electric or gas service or an REMC to implement rates proposed by the utility in a petition for a change in its basic rates if the IURC fails to issue an order on the petition within nine months for a public utility or within six months for an REMC. Requires the utility or REMC to refund to customers any difference between the rate implemented and the higher of the rate: (1) finally approved; or (2) previously in effect. Provides that a merger, consolidation, reorganization, or stock transaction involving an energy company may not occur without IURC approval if the transaction will cause more than 51% of the company's voting stock to be held by different interests. Requires the IURC to approve the transaction unless after the transaction the utility will lack the capability to provide adequate and reliable service. Allows the IURC to impose a civil penalty of up to $5,000 if a public utility providing energy services or an REMC violates any utility law or fails to comply with: (1) a standard of service established by IURC rule; or (2) a rate or service requirement of an IURC order. Allows the IURC to impose an additional penalty of
Effective: Upon passage; July 1, 2002.
January 14, 2002, read first time and referred to Committee on Rules and Legislative
Procedure.
up to $10,000 if the violation or failure demonstrates a disregard by the
public utility or REMC of its duty to remedy the violation or failure.
Specifies that a suit to recover a penalty imposed by the IURC shall be
brought by the attorney general. Expands the eligibility of public
utilities that may submit voluntary environmental compliance plans to
the IURC to include public utilities subject to any state or federal
environmental laws, in addition to public utilities subject to the Clean
Air Act. Repeals references to the Clean Air Act in the provisions
concerning environmental compliance plans.
A BILL FOR AN ACT to amend the Indiana Code concerning
utilities and transportation.
SECTION 1.
IC 8-1-2-6.6
IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 6.6. (a) As used in
this section, "clean coal technology" means a technology (including
precombustion treatment of coal):
(1) that is used at a new or existing electric generating facility and
directly or indirectly reduces airborne emissions of sulfur,
mercury, or nitrogen based pollutants associated with
combustion or use of coal; and
(2) that either:
(A) is not in general commercial use at the same or greater
scale in new or existing facilities in the United States as of
January 1, 1989; or
(B) has been selected by the United States Department of
Energy for funding under its Innovative Clean Coal
Technology program and is finally approved for such funding
on or after January 1, 1989.
"Indiana coal" means coal from a mine whose coal deposits are
located in the ground wholly or partially in Indiana regardless of the
location of the mine's tipple.
(b) As used in this section, "qualified pollution control property"
means: an
(1) any:
(A) air, wastewater, solid waste, or thermal pollution
treatment, storage, or disposal system or pollution control
device on necessary to operate a coal burning electric
generating facility; or any
(B) equipment that constitutes clean coal technology;
that has been approved for use by the commission, that meets
applicable state or federal requirements, and that is designed to
accommodate the burning of coal from the geological formation
known as the Illinois Basin; or
(2) any air, wastewater, solid waste, or thermal pollution
treatment, storage, or disposal system or pollution control
device or monitoring device, if the treatment, storage, or
disposal system, pollution control device, or monitoring
device:
(A) is used for any plant, equipment, or facility used or to
be used for the production, transmission, delivery, or
furnishing of heat, light, or power;
(B) is approved for use by the commission; and
(C) meets applicable state or federal requirements.
(c) As used in this section, "qualified property" means any:
(1) qualified pollution control property; or
(2) qualified utility system property.
(d) As used in this section, "qualified utility system property"
means any plant, equipment, or facility that is used or to be used
on a utility system and that is required to meet:
(1) applicable state or federal requirements for the security,
reliability, or safety of all or any part of the utility system; or
(2) applicable state or federal requirements of any:
(A) regional transmission organization (as defined in
18 CFR 35.34); or
(B) utility industry reliability organization;
having the authority under state or federal requirements, or
contract, or otherwise to set requirements for all or any part
of the utility system.
(e) As used in this section, "state or federal requirements"
includes any requirement of:
(1) any state or federal law, rule, regulation, or order; or
(2) any adjudication, settlement, or consent decree in any
federal or state court or administrative proceeding
interpreting or applying a state or federal law, rule,
regulation, or order.
(f) As used in this section, "utility" refers to any electric generating
an energy utility allowed by law to earn a return on its investment. (as
defined in
IC 8-1-2.5-2
).
(g) As used in this section, "utility system" means a system used
by a utility in whole or in part for the:
(1) production;
(2) transmission;
(3) distribution; or
(4) any combination of subdivisions (1) through (3);
of heat, light, or power to provide retail energy service (as defined
in
IC 8-1-2.5-3
), regardless of whether the service is provided
under
IC 8-1-2.5
or another provision of this article.
(b) (h) Upon the request of a utility that began construction after
October 1, 1985, of qualified pollution control property that is to be
used and useful for the public convenience, the commission shall for
ratemaking purposes add to the value of that utility's property the value
of the qualified pollution control property under construction. but only
if at the time of the application and thereafter:
(1) the facility burns only Indiana coal as its primary fuel source
once the air pollution control device is fully operational; or
(2) the utility can prove to the commission that the utility is
justified because of economic considerations or governmental
requirements in utilizing some non-Indiana coal.
(c) (i) The commission shall adopt rules under
IC 4-22-2
to
implement this section.
SECTION 2.
IC 8-1-2-6.8
IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 6.8. (a) As used in this section,
"governmentally mandated costs" include:
(1) capital, operating, maintenance, depreciation, and tax
costs, together with carrying costs, of or for qualified
property, or resulting from complying with:
(A) state or federal environmental compliance
requirements;
(B) state or federal requirements for the security,
reliability, or safety of all or any part of a utility system; or
(C) the requirements of any regional transmission
organization (as defined in 18 CFR 35.34) or utility
industry reliability organization;
(2) costs of emission allowances purchased and used by a
utility to cause its utility system to meet applicable state or
federal requirements for clean air, together with carrying
costs; and
(3) costs of decommissioning an electric generating facility
resulting from applicable state or federal requirements for the
decommissioning of the facility, together with carrying costs.
(b) As used in this section, "qualified property" has the meaning
set forth in section 6.6 of this chapter.
(c) As used in this section, "relevant date" means the later of:
(1) January 1, 2001; or
(2) the effective date of the most recent commission order
establishing a utility's basic rates and charges for retail
energy service.
(d) As used in this section, "retail energy service" has the
meaning set forth in
IC 8-1-2.5-3
, regardless of whether the service
is provided under
IC 8-1-2.5
or another provision of this article.
(e) As used in this section, "retail rate adjustment mechanism"
means a:
(1) tracking provision;
(2) surcharge provision; or
(3) similar mechanism or provision;
approved by the commission to periodically adjust a utility's rates
and charges for retail energy services to allow for the recovery of
certain costs.
(f) As used in this section, "state or federal requirements" has
the meaning set forth in section 6.6 of this chapter.
(g) As used in this section, "utility" has the meaning set forth in
section 6.6 of this chapter.
(h) As used in this section, "utility system" has the meaning set
forth in section 6.6 of this chapter.
(i) Upon the request of a utility, the commission shall allow the
utility to recover through a retail rate adjustment mechanism,
without any deferral or offset, the governmentally mandated costs
the utility reasonably incurs to provide retail energy service after
the relevant date.
(j) A retail rate adjustment mechanism proposed by a utility
under this section may be based on actual or forecasted data. If
forecasted data is used, the retail rate adjustment mechanism must
contain a reconciliation mechanism to correct any variance
between the utility's forecasted costs and the utility's actual costs
in providing retail energy service. The commission must approve
a retail rate adjustment mechanism that complies with this section.
(k) A retail rate adjustment resulting from a retail rate
adjustment mechanism approved by the commission under this
section:
(1) is in addition to any other rate adjustment a utility may be
entitled to under this title; and
(2) is not considered a general increase in basic rates and
charges under section 42(c) of this chapter or under
IC 8-1-13-30
(c).
(l) The commission shall make any adjustments to a utility's
expense tests and return tests during the twelve (12) month test
period considered by the commission in an application under
section 42(f)(3) or 42(i)(3)(c) of this chapter or under
IC 8-1-13-30
(f), whichever applies, necessary to permit the utility
to retain the revenues resulting from a retail rate adjustment
mechanism approved by the commission under this section.
SECTION 3.
IC 8-1-2-42
IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE UPON PASSAGE]: Sec. 42. (a) No change shall be
made in any schedule, including schedules of joint rates, except upon
thirty (30) days notice to the commission, and approval by the
commission, and all such changes shall be plainly indicated upon
existing schedules or by filing new schedules in lieu thereof thirty (30)
days prior to the time the same are to take effect. The commission may
prescribe a shorter time within which a change may be made. A public
or municipally owned or cooperatively owned utility may not file a
request for a general increase in its basic rates and charges within
fifteen (15) months after the filing date of its most recent request for a
general increase in its basic rates and charges, except that the
commission may order a more timely increase if:
(1) the requested increase relates to a different type of utility
service;
(2) the commission finds that the utility's financial integrity or
service reliability is threatened; or
(3) the increase is based on:
(A) a rate structure previously approved by the commission; or
(B) orders of federal courts or federal regulatory agencies
having jurisdiction over the utility.
The phrase "general increase in basic rates and charges" does not
include changes in rates related solely to the cost of fuel or to the cost
of purchased gas or purchased electricity or adjustments in accordance
with tracking provisions approved by the commission.
(b) No schedule of rates, tolls, and charges of a public or
municipally owned or cooperatively owned utility which includes or
authorizes any changes in charges based upon costs is effective without
the approval of the commission. Before the commission approves any
changes in the schedule of rates, tolls, and charges of an electric utility,
which generates and sells electricity, based upon the cost of fuel to
generate electricity or upon the cost of fuel included in the cost of
purchased electricity, the utility consumer counselor shall examine the
books and records of the public or municipally owned or cooperatively
owned generating utility to determine the cost of fuel and the cost of
purchased electricity upon which the proposed charges are based. In
addition, before such a fuel and purchased electricity cost charge
becomes effective, the commission shall hold a summary hearing on
the sole issue of the fuel and purchased electricity charge. The utility
consumer counselor shall conduct his the utility consumer
counselor's review and make a report to the commission within twenty
(20) days after the utility's request for the fuel and purchased
electricity cost charge is filed. The commission shall hold the summary
hearing and issue its order within twenty (20) days after it receives the
utility consumer counselor's report. The provisions of this section and
sections 39, 43, 54, 55, 56, 59, 60, and 61 of this chapter concerning
the filing, printing, and changing of rate schedules and the time
required for giving notice of hearing and requiring publication of notice
do not apply to such a fuel and purchased electricity cost charge or
such a summary hearing.
(c) Regardless of the pendency of any request for a fuel and
purchased electricity cost charge by any electric utility, the books and
records pertaining to the cost of fuel and the cost of purchased
electricity of all public or municipally owned or cooperatively owned
utilities that generate electricity shall be examined by the utility
consumer counselor not less often than quarterly, and the books and
records of all electric nongenerating public or municipally owned or
cooperatively owned utilities shall be examined by the utility consumer
counselor not less often than annually. The utility consumer counselor
shall provide the commission with a report as to the examination of
said books and records within a reasonable time following said
examination. The utility consumer counselor may, if appropriate,
request of the commission a reduction or elimination of the fuel and
purchased electricity cost charge. Upon such request, the commission
shall hold a hearing forthwith in the manner provided in sections 58,
59, and 60 of this chapter.
(d) An electric generating utility may apply for a change in its fuel
and purchased electricity charge not more often than each three (3)
months. When such application is filed the petitioning utility shall
show to the commission its cost of fuel to generate electricity and the
cost of fuel included in the cost of purchased electricity, for the period
between its last order from the commission approving fuel and
purchased electricity costs in its basic rates and the latest month for
which actual fuel and purchased electricity costs are available. The
petitioning utility shall also estimate its average fuel and purchased
electricity costs for the three (3) calendar months subsequent to the
expiration of the twenty (20) day period allowed the commission in
subsection (b). The commission shall conduct a formal hearing solely
on the fuel and purchased electricity cost charge requested in the
petition subject to the notice requirements of
IC 8-1-1-8
and shall grant
the electric utility the fuel cost part of the requested fuel and
purchased electricity cost charge or the purchased electricity cost
part of the requested fuel and purchased electricity cost charge, or
both, if it finds that:
(1) with respect to the:
(A) fuel cost part of the requested fuel and purchased
electricity cost charge, the electric utility has made every
reasonable effort to acquire fuel and generate or purchase
power or both so as to provide electricity to its retail customers
at the lowest fuel cost reasonably possible; and
(B) purchased electricity part of the requested fuel and
purchased electricity cost charge, the electric utility's costs
of purchased electricity were reasonably incurred by the
electric utility to provide adequate and reliable electric
service, including the maintenance of an adequate level of
electricity reserves;
(2) the actual increases in fuel cost through the latest month for
which actual fuel costs are available since the last order of the
commission approving basic rates and charges of the electric
utility have not been offset by actual decreases in other operating
expenses;
(3) the fuel and purchased electricity adjustment charge applied
for will not result in the electric utility earning a return in excess
of the return authorized by the commission in the last proceeding
in which the basic rates and charges of the electric utility were
approved. However, subject to section 42.3 of this chapter, if the
fuel and purchased electricity charge applied for will result in
the electric utility earning a return in excess of the return
authorized by the commission, in the last proceeding in which
basic rates and charges of the electric utility were approved, the
fuel and purchased electricity charge applied for will be reduced
to the point where no such excess of return will be earned; and
(4) the utility's estimate of its prospective average fuel and
purchased electricity costs for each such three (3) calendar
months are reasonable after taking into consideration:
(A) the actual fuel and purchased electricity costs
experienced by the utility during the latest three (3) calendar
months for which actual fuel and purchased electricity costs
are available; and
(B) the estimated fuel and purchased electricity costs for the
same latest three (3) calendar months for which actual fuel
and purchased electricity costs are available.
(e) Should the commission at any time determine that an emergency
exists that could result in an abnormal change in fuel costs, it may, in
order to protect the public from the adverse effects of such change
suspend the provisions of subsection (d) as to the utility or utilities
affected by such an emergency and initiate such procedures as may be
necessary to protect both the public and the utility from harm. The
commission shall lift the suspension when it is satisfied the emergency
no longer exists.
(f) Any change in the fuel and purchased electricity cost charge
granted by the commission under the provisions of this section shall be
reflected in the rates charged by the utility in the same manner as any
other changes in rates granted by the commission in a case approving
the basic rates and charges of the utility. However, the utility may file
the change as a separate amendment to its rate schedules with a
reasonable reference therein that such charge is applicable to all of its
filed rate schedules.
(g) No schedule of rates, tolls, and charges of a public or
municipally owned or cooperatively owned gas utility that includes or
authorizes any changes in charges based upon gas costs is effective
without the approval of the commission except those rates, tolls, and
charges contained in schedules that contain specific provisions for
changes in gas costs or the cost of gas that have previously been
approved by the commission. Gas costs or cost of gas may include the
gas utility's costs for gas purchased by it from pipeline suppliers, costs
incurred for leased gas storage and related transportation, costs for
supplemental and substitute gas supplies, costs incurred for exploration
and development of its own sources of gas supplies, and other expenses
relating to gas costs as shall be approved by the commission. Changes
in a gas utility's rates, tolls, and charges based upon changes in its gas
costs shall be made in accordance with the following provisions:
(1) Before the commission approves any changes in the schedule
of rates, tolls, and charges of a gas utility based upon the cost of
the gas, the utility consumer counselor may examine the books
and records of the public or municipally owned or cooperatively
owned gas utility to determine the cost of gas upon which the
proposed changes are based. In addition, before such an
adjustment to the gas cost charge becomes effective, the
commission shall hold a summary hearing on the sole issue of the
gas cost adjustment. The utility consumer counselor shall conduct
his the utility consumer counselor's review and make a report
to the commission within thirty (30) days after the utility's request
for the gas cost adjustment is filed. The commission shall hold the
summary hearing and issue its order within thirty (30) days after
it receives the utility consumer counselor's report. The provisions
of this section and sections 39, 43, 54, 55, 56, 59, 60, and 61 of
this chapter concerning the filing, printing, and changing of rate
schedules and the time required for giving notice of hearing and
requiring publication of notice do not apply to such a gas cost
adjustment or such a summary hearing.
(2) Regardless of the pendency of any request for a gas cost
adjustment by any gas utility, the books and records pertaining to
cost of gas of all public or municipally owned or cooperatively
owned gas utilities shall be examined by the utility consumer
counselor not less often than annually. The utility consumer
counselor shall provide the commission with a report as to the
examination of said books and records within a reasonable time
following said examination. The utility consumer counselor may,
if appropriate, request of the commission a reduction or
elimination of the gas cost adjustment. Upon such request, the
commission shall hold a hearing forthwith in the manner provided
in sections 58, 59, and 60 of this chapter.
(3) A gas utility may apply for a change in its gas cost charge not
more often than each three (3) months. When such application is
filed, the petitioning utility shall show to the commission its cost
of gas for the period between its last order from the commission
approving gas costs in its basic rates and the latest month for
which actual gas costs are available. The petitioning utility shall
also estimate its average gas costs for a recovery period of not less
than the three (3) calendar months subsequent to the expiration of
the thirty (30) day period allowed the commission in subdivision
(1). The commission shall conduct a summary hearing solely on
the gas cost adjustment requested in the petition subject to the
notice requirements of
IC 8-1-1-8
and may grant the gas utility the
requested gas cost charge if it finds that:
(A) the gas utility has made every reasonable effort to acquire
long term gas supplies so as to provide gas to its retail
customers at the lowest gas cost reasonably possible;
(B) if the gas utility's petition is based in whole or in part
on the gas utility's costs for gas services purchased by the
gas utility from pipeline suppliers, the pipeline supplier or
suppliers of the gas utility has requested or has filed for a
change in the costs of gas services pursuant to the jurisdiction
and procedures of a duly constituted regulatory authority;
(C) the gas cost adjustment applied for will not result, in the
case of a public utility, in its earning a return in excess of the
return authorized by the commission in the last proceeding in
which the basic rates and charges of the public utility were
approved; however, subject to section 42.3 of this chapter, if
the gas cost adjustment applied for will result in the public
utility earning a return in excess of the return authorized by the
commission in the last proceeding in which basic rates and
charges of the gas utility were approved, the gas cost
adjustment applied for will be reduced to the point where no
such excess of return will be earned; and
(D) the utility's estimate of its prospective average gas costs
for each such future recovery period is reasonable and gives
effect to:
(i) the actual gas costs experienced by the utility during the
latest recovery period for which actual gas costs are
available; and
(ii) the actual gas costs recovered by the adjustment of the
same recovery period.
(4) Should the commission at any time determine that an
emergency exists that could result in an abnormal change in gas
costs, it may, in order to protect the public or the utility from the
adverse effects of such change suspend the provisions of
subdivision (3) as to the utility or utilities affected by such an
emergency and initiate such procedures as may be necessary to
protect both the public and the utility from harm. The commission
shall lift the suspension when it is satisfied the emergency no
longer exists.
requires a public hearing and in which an increase in revenues is
sought which exceeds the sum of two million five hundred thousand
dollars ($2,500,000), the commission shall conduct at least one (1)
public hearing in the largest municipality located within such utility's
service area.
(c) As used in this subsection, "public utility" includes a
department of public utilities created under
IC 8-1-11.1.
If the
commission fails to issue an order making a determination on a
request by a public utility for an increase in the public utility's
basic rates and charges for electric or gas service within nine (9)
months after the filing of the public utility's case in chief, the public
utility may implement the public utility's proposed rate changes
beginning on the first day of the first billing month following the
expiration of the nine (9) month period allowed the commission
under this subsection by filing notice with the commission. After
the commission issues an order making a determination on the
public's utility's request, the public utility may continue to collect
the rates implemented by the public utility under this subsection
pending a petition for rehearing or an appeal of the commission's
order under
IC 8-1-3.
Notwithstanding any other provision of this
article, upon the final determination on the public utility's request,
including the determination on any petition for rehearing or appeal
under
IC 8-1-3
, the public utility shall refund any difference
between:
(1) the revenues generated by the rates implemented by the
public utility under this subsection; and
(2) the revenues that would have been generated by the higher
of:
(A) the rates authorized in the final determination of the
proceedings; or
(B) the rates of the public utility that were in effect
immediately before the rates implemented by the public
utility under this subsection;
for the period beginning on the effective date of the rates
implemented by the public utility under this subsection and ending
on the effective date of the rates authorized in the final
determination on the proceedings. The public utility shall issue any
refunds required under this subsection not later than sixty (60)
days after the effective date of the rates authorized in the final
determination on the proceedings. The refunds must include
interest accrued from the date of the final determination at the
interest rate set forth in
IC 24-4.6-1-102.
hundred twenty (120) days after the date a person files an
application with the commission for approval of the proposed
transaction. If the commission fails to issue an order within the one
hundred twenty (120) day period allowed the commission under
this subsection, the transaction shall be considered approved by
operation of law as of the first day following the one hundred
twenty (120) day period described in this subsection. If the
transaction is approved by the commission, or considered
approved under this subsection, the commission may not take
action in any state or federal administrative or judicial proceeding
to oppose the transaction.
(j) If commission approval of a transaction involving a:
(1) merger, consolidation, reorganization, or union involving
an energy company; or
(2) tender offer or contract for the purchase, acquisition,
assignment, or transfer of stock of an energy company;
is not required under this section, commission approval of the
transaction is not required under any other provision of this title.
(k) Nothing in this chapter:
(1) prevents the holding of an energy company's stock
lawfully acquired before July 1, 2002; or
(2) prohibits a merger, consolidation, reorganization, or union
involving an energy company if the transaction was lawfully
initiated before July 1, 2002.
SECTION 6.
IC 8-1-2-109
IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2002]: Sec. 109. (a) This section
does not apply to:
(1) a public utility that owns, operates, manages, or controls
any plant or equipment within Indiana for the production,
transmission, delivery, or furnishing of heat, light, or power;
or
(2) a corporation organized or operating under
IC 8-1-13.
(b) A public utility that violates this chapter, or fails to perform any
duty enjoined upon it, for which a penalty is not otherwise provided,
commits a Class B infraction.
SECTION 7.
IC 8-1-2-109.1
IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE JULY
1, 2002]: Sec. 109.1. (a) This section does not apply when a public
utility's violation or failure to comply under subsection (d) is
caused by circumstances beyond the control of the public utility,
including any of the following:
(1) Customer provided equipment.
(2) A negligent act or omission of a customer.
(3) An emergency situation.
(4) An unavoidable casualty.
(5) An act of God.
(b) As used in this section, "public utility" means every
corporation, company, partnership, limited liability company,
individual, or association of individuals, their lessees, trustees, or
receivers appointed by a court, that own, operate, manage, or
control any plant or equipment in Indiana for the production,
transmission, delivery, or furnishing of heat, light, or power. The
term includes a department of public utilities created under
IC 8-1-11.1.
The term does not include:
(1) a municipality or political subdivision; or
(2) a corporation organized or operating under
IC 8-1-13.
(c) A public utility and every officer of a public utility shall
comply with every order or rule of the commission made under the
authority of this chapter.
(d) Except as otherwise provided in this chapter, if the
commission finds, after notice and hearing, that a public utility has
violated this chapter or failed after due notice to comply with:
(1) a standard of service established by commission rule; or
(2) a rate or service requirement of a final and unappealable
order of the commission;
the commission may order the public utility to pay a civil penalty
of not more than five thousand dollars ($5,000) for each violation
or failure to comply.
(e) Notwithstanding subsection (d), if the commission finds after
notice and hearing that the public utility's violation or failure to
comply demonstrates, by a continuing pattern of conduct, a
disregard by the public utility of its obligation to remedy the
violation or failure to comply found under subsection (d), the
commission may impose an additional civil penalty of not more
than ten thousand dollars ($10,000) for each violation or failure to
comply.
(f) The commission shall consider the following when
determining the appropriateness of the imposition or amount of a
civil penalty:
(1) The size of the public utility.
(2) The gravity of the violation or failure to comply.
(3) The good faith of the public utility in attempting to remedy
the violation or failure to comply or achieve compliance after
receiving notification of the violation or failure.
(4) The effect of the civil penalty on the public utility's
financial ability to provide adequate and reliable service.
(5) If the public utility is a nonprofit company:
(A) the effect of the penalty on the company's members
and their capitalization of the company; and
(B) whether the act or omission causing the violation or
failure to comply had been approved or requested by the
company's members.
In the order imposing the civil penalty, the commission shall make
specific findings with respect to the factors described in
subdivisions (1) through (5).
(g) A public utility may not be subject to both a civil penalty
under this section and a penalty agreed to a commission approved
settlement agreement for the same violation or failure to comply.
If the commission has approved a settlement agreement that
includes penalties or remedies for noncompliance with specific
provisions of the settlement agreement, the penalties provided in
this section do not apply to those instances of noncompliance
during the life of the settlement agreement.
(h) Notwithstanding
section 112 of this chapter
, the civil
penalties provided for in this section for each violation or failure
to comply by a public utility may not be multiplied or increased
because of the number of customers affected or the length of time
service is affected. Only one (1) violation or failure to comply per
day may be attributed to a public utility as a result of a particular
condition, system outage, storm, act, omission, event, decision, or
other cause occurring on that day.
SECTION 8.
IC 8-1-2-115
IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE JULY 1, 2002]: Sec. 115. The commission
shall inquire into any neglect or violation of the statutes of this state or
the ordinances of any city or town by any public utility doing business
therein, or by the officers, agents, or employees thereof, or by any
person operating the plant of any public utility, and shall have the
power, and it shall be its the commission's duty to enforce the
provisions of this chapter, as well as all other laws, relating to public
utilities. Any forfeiture or penalty provided in this chapter shall be
recovered, and suit therein shall be brought in the name of the state of
Indiana in the circuit or superior court where the public utility has its
principal place of business. by the attorney general in a court that
has jurisdiction. Complaint for the collection of any such forfeiture
may be made by the commission or any member thereof, and, when so
made, the action so commenced shall be prosecuted by the attorney
general. counsel.
SECTION 9.
IC 8-1-3-6
IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE UPON PASSAGE]: Sec. 6. All rules, practices,
installations, and services prescribed, approved, or required by the
commission shall be in force and shall be prima facie reasonable unless
finally found otherwise by the court of appeals or by the supreme court
if the cause is transferred to and decided by that court. However,
Except as otherwise allowed under
IC 8-1-2-61
(c) or
IC 8-1-13-38
(c), pending the appeal as in this chapter provided, any
municipally owned utility, public utility, rural electric membership
corporation, or rural telephone cooperative association whose rate or
rates are affected by the decision, ruling, or order appealed from shall
have the right to collect the rate or rates as fixed by said decision,
ruling, or order, or the former rate, whichever is higher in amount, and
such municipally owned utility, public utility, corporation, or
association shall refund the difference to each consumer or contract
customer if such difference be not sustained upon appeal. However,
pending the appeal as in this chapter provided, the court of appeals,
upon good cause shown by verified petition, may authorize and permit,
but not require, any common or contract carrier whose rate or rates are
affected by the decision, ruling, or order appealed from, to collect the
rate or rates published and in effect or the rate or rates sought to be put
into effect, immediately prior to the commencement of the proceeding
before the commission, subject to such provisions for bond or escrow
as the court shall provide to protect the interest of all parties of record
before the court.
SECTION 10.
IC 8-1-3-7
IS AMENDED TO READ AS FOLLOWS
[EFFECTIVE UPON PASSAGE]: Sec. 7. (a) Upon determination of
the appeal, the court shall have jurisdiction to affirm or set aside such
decision, ruling, or order of the commission, in whole or in part, or
remand the proceeding to the commission with instructions. No
evidence beyond that contained in the record of the proceedings before
the commission shall be considered or received by the court, except
that in cases where issues of confiscation or of constitutional right are
involved, the court, on its own motion or verified petition of a party,
may order such additional evidence as it deems necessary for the
determination of such issues to be taken before the commission and to
be received at the hearing before the commission in such manner and
upon such terms and conditions as the court shall order.
(b) If a new hearing is ordered under subsection (a), the commission
is not required to receive any evidence as to facts which were in
existence at the time of the prior commission hearing or hearings,
except upon a showing, either to the court in the first instance, or the
commission, upon the hearing, that:
(1) the evidence was not available for presentation to the
commission prior to the entry of its final decision, ruling, or order,
or prior to the determination of the commission upon the petition
for rehearing, if a petition for rehearing was filed; and
(2) due diligence was exercised by the party offering the evidence
to procure and present the evidence to the commission prior to the
entry of its final decision, ruling, or order, or its determination
upon the petition for rehearing, if any was filed.
(c) Whenever the court shall order additional evidence to be taken
the commission shall promptly hear and report the evidence to the
court so that the proof may be brought as nearly as reasonably possible
down to the date of its report to the court. The commission may, after
hearing such evidence, modify its findings as to facts and its original
decision, ruling, or order, and it shall file with the court the amended
decision or orders and any modified or new findings.
(d) If the commission modifies or amends its original decision or
orders, the appealing party or any other party aggrieved by the modified
or amended decision or order may file with the court, within the time
allowed by the court, a specification of any errors of law claimed to
have been made by the commission in the modified decision or orders.
A specification of errors shall be considered by the court in addition to
the errors of law asserted in the assignment or assignments of error.
(e) The supreme court and the court of appeals, as the case may be,
have jurisdiction, upon application of the commission or any party, to
order or enjoin temporarily or permanently the enforcement of any
determination, ruling, or order of the commission made in the cause.
(f) The supreme court and the court of appeals, as the case may be,
also have jurisdiction upon application of a public utility to issue
temporary injunctions protecting the utility in the collection of rates
determined by the court to be nonconfiscatory during the pendency of
the proceeding and until nonconfiscatory rates are fixed by the
commission if existing rates are finally determined to be confiscatory,
with appropriate provisions as to bonds and refunds. A public utility
that provides electric or gas service is not required to petition the
court under this subsection in order to collect the rates allowed
under
IC 8-1-2-61
(c) during the pendency of the proceeding. A
corporation that provides electric service under
IC 8-1-13
is not
required to petition the court under this subsection in order to
collect the rates allowed under
IC 8-1-13-38
(c) during the
pendency of the proceeding.
the cost of fuel to generate electricity or upon the cost of fuel included
in the cost of purchased electricity, the utility consumer counselor shall
examine the books and records of the public generating corporation to
determine the cost of fuel and the cost of purchased electricity upon
which the proposed charges are based. In addition, before a fuel and
purchased electricity cost charge becomes effective, the commission
shall hold a summary hearing on the sole issue of the fuel and
purchased electricity charge. The utility consumer counselor shall
conduct a review and make a report to the commission within twenty
(20) days after the corporation's request for the fuel and purchased
electricity cost charge is filed. The commission shall hold the summary
hearing and issue its order within twenty (20) days after it receives the
utility consumer counselor's report. The provisions of this chapter
concerning the filing, printing, and changing of rate schedules and the
time required for giving notice of hearing and requiring publication of
notice do not apply to the fuel and purchased electricity cost charge
or the summary hearing.
(c) Regardless of the pendency of any request for a fuel and
purchased electricity cost charge by any corporation, the books and
records pertaining to cost of fuel and the cost of purchased electricity
of all corporations that generate electricity shall be examined by the
utility consumer counselor not less often than quarterly, and the books
and records of all electric nongenerating corporations shall be
examined by the utility consumer counselor not less often than
annually. The utility consumer counselor shall provide the commission
with a report as to the examination of the books and records within a
reasonable time following the examination. The utility consumer
counselor may, if appropriate, request of the commission a reduction
or elimination of the fuel and purchased electricity cost charge. Upon
such request, the commission shall immediately hold a hearing in the
manner provided in this chapter.
(d) An electric generating corporation may apply for a change in its
fuel and purchased electricity charge not more often than each three
(3) months. When the application is filed the petitioning corporation
shall show to the commission its cost of fuel to generate electricity and
the cost of fuel included in the cost of purchased electricity, for the
period between its last order from the commission approving fuel and
purchased electricity costs in its basic rates and the latest month for
which actual fuel costs and actual purchased electricity costs are
available. The petitioning corporation shall also estimate its average
fuel and purchased electricity costs for the three (3) calendar months
subsequent to the expiration of the twenty (20) day period allowed the
commission in subsection (b). The commission shall conduct a formal
hearing solely on the fuel and purchased electricity cost charge
requested in the petition subject to the notice requirements of
IC 8-1-1-8
and shall grant the electric corporation the fuel cost part of
the requested fuel and purchased electricity cost charge or the
purchased electricity cost part of the requested fuel and purchased
electricity cost charge, or both, if it finds that:
(1) with respect to the:
(A) fuel cost part of the requested fuel and purchased
electricity cost charge, the electric corporation has made
every reasonable effort to acquire fuel and generate or
purchase power or both so as to provide electricity to its retail
customers at the lowest fuel cost reasonably possible; and
(B) purchased electricity part of the requested fuel and
purchased electricity cost charge, the electric corporation's
costs of purchased electricity were reasonably incurred by
the electric corporation to provide adequate and reliable
electric service, including the maintenance of an adequate
level of electricity reserves;
(2) the actual increases in fuel cost through the latest month for
which the actual fuel costs are available since the last order of the
commission approving basic rates and charges of the electric
corporation have not been offset by actual decreases in other
operating expenses;
(3) the corporation's estimate of its prospective average fuel and
purchased electricity costs for each of the three (3) calendar
months are is reasonable after taking into consideration:
(A) the actual fuel and purchased electricity costs
experienced by the corporation during the latest three (3)
calendar months for which actual fuel and purchased
electricity costs are available; and
(B) the estimated fuel and purchased electricity costs for the
same latest three (3) calendar months for which actual fuel
and purchased electricity costs are available.
(e) Should the commission at any time determine that an emergency
exists that could result in an abnormal change in fuel costs, it may, in
order to protect the public from the adverse effects of such change,
suspend the provisions of subsection (d) as to the corporation affected
by the emergency and initiate such procedures as may be necessary to
protect both the public and the corporation from harm. The commission
shall lift the suspension when it is satisfied the emergency no longer
exists.
request by a corporation for an increase in the corporation's basic
rates and charges for electric service within six (6) months of the
date the corporation files its case in chief in support of its request,
the corporation may implement the corporation's proposed rate
changes beginning on the first day of the first billing month
following the expiration of the six (6) month period allowed the
commission under this subsection by filing notice with the
commission. After the commission issues an order making a
determination on the corporation's request, the corporation may
continue to collect the rates implemented by the corporation under
this subsection pending a petition for rehearing or an appeal of the
commission's order under
IC 8-1-3.
Notwithstanding any other
provision of this article, upon the final determination on the
corporation's request, including the determination on any petition
for rehearing or appeal under
IC 8-1-3
, the corporation shall
refund any difference between:
(1) the revenues generated by the rates implemented by the
corporation under this subsection; and
(2) the revenues that would have been generated by the higher
of:
(A) the rates authorized in the final determination of the
proceedings; or
(B) the rates of the corporation that were in effect
immediately before the rates implemented by the
corporation under this subsection;
for the period beginning on the effective date of the rates
implemented by the corporation under this subsection and ending
on the effective date of the rates authorized in the final
determination of the proceedings. The corporation shall issue any
refunds required under this subsection not later than sixty (60)
days after the effective date of the rates authorized in the final
determination of the proceedings. The refunds must include
interest accrued from the date of the final determination at the
interest rate set forth in
IC 24-4.6-1-102.
SECTION 14.
IC 8-1-13-41.1
IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2002]: Sec. 41.1. (a) The authority granted to
the commission under this section is in addition to the commission's
authority to act under section 41 of this chapter.
(b) This section does not apply when a corporation's violation
or failure to comply under subsection (d) is caused by
circumstances beyond the control of the corporation, including any
of the following:
(1) Customer provided equipment.
(2) A negligent act or omission of a customer.
(3) An emergency situation.
(4) An unavoidable casualty.
(5) An act of God.
(c) A corporation subject to the commission's jurisdiction under
this chapter and every officer of the corporation shall comply with
every order or rule of the commission made under the authority of
this chapter.
(d) Except as otherwise provided in this chapter, if the
commission finds after notice and hearing that a corporation has
violated this chapter or failed after due notice to comply with:
(1) a standard of service established by commission rule; or
(2) a rate or service requirement of a final and unappealable
order of the commission;
the commission may order the corporation to pay a civil penalty of
not more than five thousand dollars ($5,000) for each violation or
failure to comply.
(e) Notwithstanding subsection (d), if the commission finds after
notice and hearing that the corporation's violation or failure to
comply demonstrates, by a continuing pattern of conduct, a
disregard by the corporation of its obligation to remedy the
violation or failure to comply found under subsection (d), the
commission may impose an additional civil penalty of not more
than ten thousand dollars ($10,000) for each violation or failure to
comply.
(f) The commission shall consider the following when
determining the appropriateness of the imposition or amount of a
civil penalty:
(1) The size of the corporation.
(2) The gravity of the violation or failure to comply.
(3) The good faith of the corporation in attempting to remedy
the violation or failure to comply or achieve compliance after
receiving notification of the violation or failure.
(4) The effect of the civil penalty on the corporation's
members and their capitalization of the corporation.
(5) Whether the act or omission causing the violation or
failure to comply had been approved or requested by the
corporation's members.
In the order imposing the civil penalty, the commission shall make
specific findings with respect to the factors described in
subdivisions (1) through (5).
(g) A corporation may not be subject to both a civil penalty
under this section and a penalty agreed to in a commission
approved settlement agreement for the same violation or failure to
comply. If the commission has approved a settlement agreement
that includes penalties or remedies for noncompliance with specific
provisions of the settlement agreement, the penalties provided in
this section do not apply to those instances of noncompliance
during the life of the settlement agreement.
(h) Notwithstanding
IC 8-1-2-112
, the civil penalties provided
for in this section for each violation or failure to comply by a
corporation may not be multiplied or increased because of the
number of customers affected or the length of time service is
affected. Only one violation or failure to comply per day may be
attributed to a corporation as a result of a particular condition,
system outage, storm, act, omission, event, decision, or other cause
occurring on that day.
SECTION 15.
IC 8-1-13-41.2
IS ADDED TO THE INDIANA
CODE AS A NEW SECTION TO READ AS FOLLOWS
[EFFECTIVE JULY 1, 2002]: Sec. 41.2. The commission shall
inquire into any neglect or violation of the statutes of Indiana or
the ordinances of any city or town by any corporation organized
under this chapter and doing business in the state, city, or town,
whichever applies, by the officers, agents, or employees of the
corporation, or by any person operating the plant of any
corporation, and the commission shall have the power and duty to
enforce the provisions of this chapter, as well as all other laws,
relating to corporations regulated under this chapter. Any
forfeiture or penalty provided in this chapter shall be recovered
and any suit related to the forfeiture or penalty shall be brought in
the name of the state of Indiana by the attorney general in a court
that has jurisdiction. Complaint for the collection of any forfeiture
or penalty may be made by the commission or any commission
member and, when made, the action commenced shall be
prosecuted by the attorney general.
SECTION 16.
IC 8-1-27-3
IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 3. As used in this
chapter, "environmental compliance plan" means a plan developed by
a public utility to comply in whole or in part with the requirements of
the Clean Air Act Amendments of 1990. state or federal
environmental laws.
SECTION 17.
IC 8-1-27-5.7
IS ADDED TO THE INDIANA CODE
AS A NEW SECTION TO READ AS FOLLOWS [EFFECTIVE
UPON PASSAGE]: Sec. 5.7. As used in this chapter, "state or
federal environmental laws" means:
(1) any state or federal law, rule, regulation, or order; or
(2) any adjudication, settlement, or consent decree in any state
or federal court or administrative proceeding interpreting or
applying a state or federal law, rule, regulation, or order;
relating to the protection, monitoring, preservation, remediation,
or restoration of human health, the environment, or natural
resources from air, wastewater, solid waste, or thermal pollution.
SECTION 18.
IC 8-1-27-6
IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 6. (a) A public
utility that has at least one (1) generating unit affected by Section 404
(Phase I) or Section 405 (Phase II) of the Clean Air Act Amendments
of 1990 state or federal environmental laws may voluntarily submit
to the commission for the commission's review and approval under
this chapter a verified environmental compliance plan that sets forth
the manner in which the public utility intends to comply with the
requirements of the Clean Air Act Amendments of 1990 to the
commission for the commission's review and approval under this
chapter. state or federal environmental laws addressed by the plan.
(b) An environmental compliance plan described in subsection (a)
must include any information that the commission may reasonably
require. The commission shall require a plan described in subsection
(a) to include at least the following information:
(1) A description of the requirements of the Clean Air Act
Amendments of 1990 state or federal environmental laws
addressed by the plan and applicable to each facility or
generating unit owned or operated by the public utility.
(2) A description of the measures the public utility proposes to
implement to comply with the requirements.
(3) The schedule under which the public utility proposes to
implement the measures.
(4) An estimate of the cost of implementing each of the measures
proposed by the public utility.
(5) An analysis of the comparative estimated costs of meeting the
applicable requirements of the Clean Air Act Amendments of
1990 state or federal environmental laws addressed by the
plan through the measures proposed by the public utility and
other alternative compliance measures considered by the public
utility.
(6) For all compliance plans submitted to the commission after
July 1, 1993, if an environmental compliance plan proposes a
change of fuel type from the fuel type consumed in the public
utility's generating units and that change of fuel type would result
in the displacement or diminished use of Indiana coal from the
quantity of Indiana coal consumed by the public utility during the
calendar year 1990, or an average of the quantity of Indiana coal
consumed by the utility in calendar years 1990, 1991, and 1992,
whichever is submitted by the utility in the plan, the public utility
shall submit the following as part of the environmental
compliance plan:
(A) An analysis of the following:
(i) The economic and employment effects of the proposed
change of fuel type on the regions of Indiana in which the
mining of coal provides employment, and on the service
territory of the public utility.
(ii) The effects of the proposed modification on the
preservation of the mining of Indiana coal as a viable source
of fuel.
The analyses required under this clause must include a
comparison of the effects likely to result from the alternative
compliance measures identified under subdivision (5).
(B) Information describing the availability, the reliability, the
current costs, and the projected future costs of the fuel type
proposed for use in connection with the environmental
compliance plan.
SECTION 19.
IC 8-1-27-8
IS AMENDED TO READ AS
FOLLOWS [EFFECTIVE UPON PASSAGE]: Sec. 8. The commission
shall issue an order approving an environmental compliance plan if the
commission:
(1) finds that the environmental compliance plan:
(A) is reasonably designed to meet or exceed the applicable
requirements of the Clean Air Act Amendments of 1990; state
or federal environmental laws addressed by the plan;
(B) constitutes a reasonable and least cost strategy over the life
of the investment consistent with providing reliable, efficient,
and economical electrical service; and
(C) is in the public interest; and
(D) either:
(i) provides for continued or increased use of Indiana coal in
the coal-consuming electric generating units owned or
operated by the public utility and affected by the Clean Air
Act Amendments of 1990; or
amended by this act, applies to a petition for an increase in basic
rates and charges made by a public utility after March 31, 2002.
(b)
IC 8-1-13-38
, as amended by this act, applies to a petition for
an increase in basic rates and charges made by a rural electric
membership corporation after March 31, 2002.
(c) This SECTION expires January 1, 2003.
SECTION 25. An emergency is declared for this act.