Senate Bill No. 381-Committee on Commerce and Labor
May 9, 1997
____________
Referred to Committee on Commerce and Labor
SUMMARY--Revises provisions regarding sale of electricity by public utilities. (BDR 58-705)
FISCAL NOTE: Effect on Local Government: No.
Effect on the State or on Industrial Insurance: No.
EXPLANATION - Matter in italics is new; matter in brackets [ ] is material to be omitted.
AN ACT relating to public utilities; authorizing an electric utility to sell electricity to its customers under the terms of a contract with the customer; authorizing certain modifications of rates without approval of the public service commission of Nevada; and providing other matters properly relating thereto.
THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:
Section 1 Chapter 704 of NRS is hereby amended by adding thereto the provisions set forth as sections 2 and 3 of this act.
Sec. 2 1. On or after January 1, 1998, a public utility may provide electric service to a customer in accordance with the terms of a contract with the customer. The terms of such a contract, including any schedule of rates, are exempt from the provisions of NRS 704.080, 704.090, 704.100 and 704.110. A contract proposed pursuant to the provisions of this section may be filed with the commission for approval. Upon the request of the parties to the contract, the commission shall treat as confidential, pursuant to subsection 2 of NRS 703.190, the terms of the contract.
2. If the commission does not disapprove a proposed contract within 60 days after the filing, the commission shall be deemed to have approved the contract. If the commission approves the contract, the costs and revenues related to serving a customer who is a party to the contract shall be deemed reasonable and allowable for purposes of any proceeding of the commission in which the gross annual revenues of the public utility are being considered.
3. The commission may disapprove a contract filed pursuant to this section only upon a determination that:
(a) The customer to whom the rates of the contract will apply is not able to acquire electric service from a source other than the public utility proposing the contract; and
(b) The revenue from the contract will not be sufficient to recover the cost related to serving the customer.
Sec. 3 1. On or after January 1, 1998, a public utility may file with the commission a proposal to modify any schedule of rates for the sale of electrical energy if the modification will not result in a change in the gross annual revenue of the public utility. If the commission approves the costs and revenues related to the proposed schedule, those amounts shall be deemed reasonable and allowable for purposes of any proceeding of the commission in which the gross annual revenue of the public utility are being considered. If the commission does not disapprove the proposed modification within 60 days after the filing of the proposal, the commission shall be deemed to have approved the modified schedule.
2. The commission may disapprove such a proposed modification only upon a determination that:
(a) The proposed schedule of rates is inequitable when compared to an existing rate; or
(b) The revenue from the proposed schedule will not be sufficient to recover the cost related to serving the customer to whom the requested rate will apply.
3. If the commission after a hearing amends the proposed modification filed pursuant to this subsection, the public utility may withdraw the proposed schedule without implementing the proposed modifications.
Sec. 4 NRS 704.070 is hereby amended to read as follows:
704.070Unless exempt under the provisions of section 2 of this act, NRS 704.075 or 704.097:
1. Every public utility shall file with the commission, within a time to be fixed by the commission, schedules which must be open to public inspection, showing all rates, tolls and charges which it has established and which are in force at the time for any service performed or product furnished in connection therewith by any public utility controlled and operated by it.
2. All rules or regulations that in any manner affect the rates charged or to be charged for any service or product must be filed with that schedule.
Sec. 5 NRS 704.100 is hereby amended to read as follows:
704.100Except as otherwise provided in sections 2 and 3 of this act, NRS 704.075 or as may otherwise be provided by the commission pursuant to NRS 704.095, 704.097 or 704.275:
1. No changes may be made in any schedule, including schedules of joint rates, or in the rules or regulations affecting any rates or charges, except upon 30 days' notice to the commission, and all changes must be plainly indicated, or by filing new schedules in lieu thereof 30 days before the time the schedules are to take effect. The commission, upon application of any public utility, may prescribe a shorter time within which a reduction may be made.
2. Copies of all proposed, new or amended schedules must be filed and posted in the offices of public utilities as required for original schedules.
3. A public utility may set forth as justification for a rate increase items of expense or rate base which have been considered and disallowed by the commission, only if those items are clearly identified in the application and new facts or considerations of policy for each item are advanced in the application to justify a reversal of the commission's prior decision.
4. The commission shall determine whether a hearing must be held when the proposed change in any schedule stating a new or revised individual or joint rate, fare or charge, or any new or revised individual or joint regulation or practice affecting any rate, fare or charge, will result in an increase in annual gross revenue as certified by the applicant of $2,500 or less.
5. In making the determination the commission shall first consider all timely written protests, any presentation the staff of the commission may desire to present, the application and any other matters deemed relevant by the commission.
Sec. 6 NRS 704.110 is hereby amended to read as follows:
704.110Except as otherwise provided in sections 2 and 3 of this act, NRS 704.075 or as otherwise provided by the commission pursuant to NRS 704.095 or 704.097:
1. Whenever there is filed with the commission any schedule stating a new or revised individual or joint rate, fare or charge, or any new or revised individual or joint regulation or practice affecting any rate, fare or charge, or any schedule resulting in a discontinuance, modification or restriction of service, the commission may, upon complaint or upon its own motion without complaint, at once, without answer or formal pleading by the interested utility, investigate or, upon reasonable notice, conduct a hearing concerning the propriety of the rate, fare, charge, classification, regulation, discontinuance, modification, restriction or practice.
2. Pending the investigation or hearing and the decision thereon, the commission, upon delivering to the utility affected thereby a statement in writing of its reasons for the suspension, may suspend the operation of the schedule and defer the use of the rate, fare, charge, classification, regulation, discontinuance, modification, restriction or practice, but not for more than 150 days beyond the time when the rate, fare, charge, classification, regulation, discontinuance, modification, restriction or practice would otherwise go into effect.
3. Whenever there is filed with the commission any schedule stating an increased individual or joint rate, fare or charge for service or equipment, the public utility shall submit with its application a statement showing the recorded results of revenues, expenses, investments and costs of capital for its most recent 12 months for which data were available when the application was prepared. During any hearing concerning the increased rates, fares or charges determined by the commission to be necessary, the commission shall consider evidence in support of the increased rates, fares or charges based upon actual recorded results of operations for the same 12 months, adjusted for increased revenues, any increased investment in facilities, increased expenses for depreciation, certain other operating expenses as approved by the commission and changes in the costs of securities which are known and are measurable with reasonable accuracy at the time of filing and which will become effective within 6 months after the last month of those 12 months, but no new rates, fares or charges may be placed into effect until the changes have been experienced and certified by the utility to the commission. The commission shall also consider evidence supporting expenses for depreciation, calculated on an annual basis, applicable to major components of the public utility's plant placed into service during the recorded test period or the period for certification as set forth in the application. Adjustments to revenues, operating expenses and costs of securities must be calculated on an annual basis. Within 90 days after the filing with the commission of the certification required in this subsection, or before the expiration of any period of suspension ordered pursuant to subsection 2, whichever time is longer, the commission shall make such order in reference to those rates, fares or charges as is required by this chapter.
4. After full investigation or hearing, whether completed before or after the date upon which the rate, fare, charge, classification, regulation, discontinuance, modification, restriction or practice is to go into effect, the commission may make such order in reference to the rate, fare, charge, classification, regulation, discontinuance, modification, restriction or practice as would be proper in a proceeding initiated after the rate, fare, charge, classification, regulation, discontinuance, modification, restriction or practice has become effective.
5. Whenever an application is filed by a public utility for an increase in any rate, fare or charge based upon increased costs in the purchase of fuel or power [,] and the public utility has elected to use deferred accounting for costs of the purchase of fuel or power in accordance with the commission's regulations, the commission, by appropriate order after a public hearing, shall allow the public utility to clear the deferred account not more often than every 6 months by refunding any credit balance or recovering any debit balance over a period not to exceed 1 year as determined by the commission. The commission shall not allow a recovery of a debit balance or any portion thereof in an amount which would result in a rate of return in excess of the rate of return most recently granted the public utility.
6. Except as otherwise provided in subsection 7 or in NRS 707.350, whenever a general rate application for an increased rate, fare or charge for, or classification, regulation, discontinuance, modification, restriction or practice involving service or equipment has been filed with the commission, a public utility shall not submit another general rate application until all pending general rate applications for increases in rates submitted by that public utility have been decided unless, after application and hearing, the commission determines that a substantial financial emergency would exist if the other application is not permitted to be submitted sooner.
7. A public utility may not file an application to recover the increased cost of purchased fuel, purchased power, or natural gas purchased for resale more often than once every 30 days.
8. A utility facility identified in a 3-year plan submitted pursuant to NRS 704.741 or 704.755 and accepted by the commission for acquisition or construction pursuant to NRS 704.751 or 704.755 and the regulations adopted pursuant thereto shall be deemed to be a prudent investment. The utility may recover all just and reasonable costs of planning and constructing such a facility. For the purposes of this subsection, "utility facility" has the meaning ascribed to it in subsections 1, 2 and 3 of NRS 704.860.
Sec. 7 1. The public service commission of Nevada shall, on or before January 1, 1998, adopt any regulations that it determines are necessary to carry out the provisions of this act.
2. The amendatory provisions of this act do not apply to or affect any contract for the provision of electric service that was entered into before the effective date of this act.
Sec. 8 This act becomes effective upon passage and approval.