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H. B. No. 95 As IntroducedAs Introduced
129th General Assembly | Regular Session | 2011-2012 |
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Cosponsors:
Representatives Blessing, Uecker, Mecklenborg, Balderson, Hayes, Goodwin, Martin
A BILL
To amend sections 4903.083, 4905.302, 4906.06,
4909.05, 4909.06, 4909.07, 4909.08, 4909.15,
4909.156, 4909.17, 4909.18, 4909.19, 4928.18,
4929.05, 4929.051, 4929.11, and 4935.04 and to
enact section 4929.111 of the Revised Code to
permit certain rate-calculation adjustments for
natural gas companies, eliminate public notice
requirements for rate cases, and, for natural gas
companies, to make other regulatory changes
concerning audits, alternative rate plans, and
forecast reports, and allowing applications for
natural gas company capital expenditure programs.
BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:
Section 1. That sections 4903.083, 4905.302, 4906.06,
4909.05, 4909.06, 4909.07, 4909.08, 4909.15, 4909.156, 4909.17,
4909.18, 4909.19, 4928.18, 4929.05, 4929.051, 4929.11, and 4935.04
be amended and section 4929.111 of the Revised Code be enacted to
read as follows:
Sec. 4903.083. For all cases involving applications for an
increase in rates pursuant to section 4909.18 of the Revised Code
the public utilities commission shall hold public hearings in each
municipal corporation in the affected service area having a
population in excess of one hundred thousand persons, provided
that, at least one public hearing shall be held in each affected
service area. At least one such hearing shall be held after 5:00
p.m. Notice of such hearing shall be published by the public
utilities commission once each week for two consecutive weeks in a
newspaper of general circulation in the service area. Said notice
shall state prominently the total amount of the revenue increase
requested in the application for the increase and shall list a
brief summary of the then known major issues in contention as set
forth in the respective parties' and intervenor's objections to
the staff report filed pursuant to section 4909.19 of the Revised
Code. The public utilities commission shall determine a uniform
format for the content of all notices required under this section.
Defects in the content of said notice shall not affect the
legality of notices published under this section provided the
public utilities commission meets the substantial compliance
provision of section 4905.09 of the Revised Code.
Sec. 4905.302. (A)(1) For the purpose of this section, the
term "purchased gas adjustment clause" means:
(a) A provision in a schedule of a gas company or natural gas
company that requires or allows the company to, without adherence
to section 4909.18 or 4909.19 of the Revised Code, adjust the
rates that it charges to its customers in accordance with any
fluctuation in the cost to the company of obtaining the gas that
it sells, that has occurred since the time any order has been
issued by the public utilities commission establishing rates for
the company pertaining to those customers;
(b) A provision in an ordinance adopted pursuant to section
743.26 or 4909.34 of the Revised Code or Section 4 of Article
XVIII, Ohio Constitution, with respect to which a gas company or
natural gas company is required or allowed to adjust the rates it
charges under such an ordinance in accordance with any fluctuation
in the cost to the company of obtaining the gas that it sells,
that has occurred since the time of the adoption of the ordinance.
(2) For the purpose of this section, the term "special
purchase" means any purchase of interstate natural gas, any
purchase of liquified liquefied natural gas, and any purchase of
synthetic natural gas from any source developed after the
effective date of this section, April 27, 1976, provided that this
purchase be of less than one hundred twenty days duration and the
price for this purchase is not regulated by the federal power
commission. For the purpose of this division, the expansion or
enlargement of a synthetic natural gas plant existing at such date
shall be considered a source so developed.
(3) For the purpose of this section, the term "residential
customer" means urban, suburban, and rural patrons of gas
companies and natural gas companies insofar as their needs for gas
are limited to their residence. Such term includes those patrons
whose rates have been set under an ordinance adopted pursuant to
sections 743.26 and 4909.34 of the Revised Code or Section 4 of
Article XVIII, Ohio Constitution.
(4) For the purposes of this section, the term "customer
choice program" means a program of a natural gas company under
which customers may choose a natural gas supplier other than the
natural gas company.
(B) A purchased gas adjustment clause may not allow, and no
such clause may be interpreted to allow, a gas company or natural
gas company that has obtained an order from the public utilities
commission permitting the company to curtail the service of any
customer or class of customers other than residential customers,
such order being based on the company's inability to secure a
sufficient quantity of natural gas, to distribute the cost of any
special purchase made subsequent to the effective date of such
order, to the extent that such purchase decreases the level of
curtailment of any such customer or class of customers, to any
class of customers of the company that was not curtailed, to any
class of residential customers of the company, or to any class of
customers of the company whose level of curtailment was not
decreased and whose consumption increased as a result of, or in
connection with, the special purchase.
(C)(1) The commission shall promulgate a purchased gas
adjustment rule, consistent with this section, that establishes a
uniform purchased gas adjustment clause to be included in the
schedule of gas companies and natural gas companies subject to the
jurisdiction of the public utilities commission and that
establishes investigative procedures and proceedings including,
but not limited to, periodic reports, audits, and hearings.
(2) Unless otherwise ordered by the commission for good cause
shown and except as provided in division (D) of this section:
(a) The commission's staff shall conduct any audit or other
investigation of a natural gas company having fifteen thousand or
fewer customers in this state that may be required under the
purchased gas adjustment rule.
(b) Except as provided in section 4905.10 of the Revised
Code, the commission shall not impose upon such company any fee,
expense, or cost of such audit or other investigation or any
related hearing under this section.
(3) Unless otherwise ordered by the commission for good cause
shown either by an interested party or by the commission on its
own motion, no natural gas company having fifteen thousand or
fewer customers in this state shall be subject under the purchased
gas adjustment rule to any audit or other investigation or any
related hearing, other than a financial audit or, as necessary,
any hearing related to a financial audit.
(4) In issuing an order under division (C)(2) or (3) of this
section, the commission shall file a written opinion setting forth
the reasons showing good cause under such division and the
specific matters to be audited, investigated, or subjected to
hearing. Nothing in division (C)(2) or (3) of this section
relieves such a natural gas company from the duty to file such
information as the commission may require under the rule for the
purpose of showing that a company has charged its customers
accurately for the cost of gas obtained.
(D) Neither of the following shall be subject to any audit or
other investigation or any related hearing under division (C) of
this section:
(1) A natural gas company that does not sell natural gas
under a purchased gas adjustment clause;
(2) A natural gas company that has a customer choice program
under which thirty per cent or more of the natural gas company's
residential customers obtain natural gas.
(E) Nothing in this section or any other provision of law
shall be construed to mean that the commission, in the event of
any cost distribution allowed under this section, may issue an
order pursuant to which the prudent and reasonable cost of gas to
a gas company or natural gas company of any special purchase may
not be recovered by the company. For the purpose of this division,
such cost of gas neither includes any applicable franchise taxes
nor the ordinary losses of gas experienced by the company in the
process of transmission and distribution.
(E)(F) The commission shall not at any time prevent or
restrain such costs as are distributable under this section from
being so distributed, unless the commission has reason to believe
that an arithmetic or accounting inaccuracy exists with respect to
such a distribution or that the company has not accurately
represented the amount of the cost of a special purchase, or has
followed imprudent or unreasonable procurement policies and
practices, has made errors in the estimation of cubic feet sold,
or has employed such other practices, policies, or factors as the
commission considers inappropriate.
(F)(G) The cost of natural gas under this section shall not
include any cost recovered by a natural gas company pursuant to
section 4929.25 of the Revised Code.
Sec. 4906.06. (A) An applicant for a certificate shall file
with the office of the chairperson of the power siting board an
application, in such form as the board prescribes, containing the
following information:
(1) A description of the location and of the major utility
facility;
(2) A summary of any studies that have been made by or for
the applicant of the environmental impact of the facility;
(3) A statement explaining the need for the facility;
(4) A statement of the reasons why the proposed location is
best suited for the facility;
(5) A If applicable, a statement of how the facility fits
into the applicant's forecast contained in the report submitted
under section 4935.04 of the Revised Code;
(6) Such other information as the applicant may consider
relevant or as the board by rule or order may require. Copies of
the studies referred to in division (A)(2) of this section shall
be filed with the office of the chairperson, if ordered, and shall
be available for public inspection.
The application shall be filed not less than one year nor
more than five years prior to the planned date of commencement of
construction. Either period may be waived by the board for good
cause shown.
(B) Each application shall be accompanied by proof of service
of a copy of such application on the chief executive officer of
each municipal corporation and county, and the head of each public
agency charged with the duty of protecting the environment or of
planning land use, in the area in which any portion of such
facility is to be located.
(C) Each applicant within fifteen days after the date of the
filing of the application shall give public notice to persons
residing in the municipal corporations and counties entitled to
receive notice under division (B) of this section, by the
publication of a summary of the application in newspapers of
general circulation in such area. Proof of such publication shall
be filed with the office of the chairperson.
(D) Inadvertent failure of service on, or notice to, any of
the persons identified in divisions (B) and (C) of this section
may be cured pursuant to orders of the board designed to afford
them adequate notice to enable them to participate effectively in
the proceeding. In addition, the board, after filing, may require
the applicant to serve notice of the application or copies thereof
or both upon such other persons, and file proof thereof, as the
board considers appropriate.
(E) An application for an amendment of a certificate shall be
in such form and contain such information as the board prescribes.
Notice of such an application shall be given as required in
divisions (B) and (C) of this section.
(F) Each application for certificate or an amendment shall be
accompanied by the application fee prescribed by board rule. All
application fees, supplemental application fees, and other fees
collected by the board shall be deposited in the state treasury to
the credit of the power siting board fund, which is hereby
created. The chairperson shall administer and authorize
expenditures from the fund for any of the purposes of this
chapter. If the chairperson determines that moneys credited to the
fund from an applicant's fee are not sufficient to pay the board's
expenses associated with its review of the application, the
chairperson shall request the approval of the controlling board to
assess a supplemental application fee upon an applicant to pay
anticipated additional expenses associated with the board's review
of the application or an amendment to an application. If the
chairperson finds that an application fee exceeds the amount
needed to pay the board's expenses for review of the application,
the chairperson shall cause a refund of the excess amount to be
issued to the applicant from the fund.
Sec. 4909.05. As used in this section:
(A) A "lease purchase agreement" is an agreement pursuant to
which a public utility leasing property is required to make rental
payments for the term of the agreement and either the utility is
granted the right to purchase the property upon the completion of
the term of the agreement and upon the payment of an additional
fixed sum of money or title to the property vests in the utility
upon the making of the final rental payment.
(B) A "leaseback" is the sale or transfer of property by a
public utility to another person contemporaneously followed by the
leasing of the property to the public utility on a long-term
basis.
(C) The public utilities commission shall prescribe the form
and details of the valuation report of the property of each public
utility or railroad in the state. Such report shall include all
the kinds and classes of property, with the value of each, owned
or, held, or, with respect to a natural gas company, projected to
be owned or held at the date certain, by each public utility or
railroad used and useful, or, with respect to a natural gas
company, projected to be used and useful at the date certain, for
the service and convenience of the public. Such report shall
contain the following facts in detail:
(C)(1) The original cost of each parcel of land owned in fee
and in use, or, with respect to a natural gas company, projected
to be owned in fee and in use, at the date certain determined by
the commission; and also a statement of the conditions of
acquisition, whether by direct purchase, by donation, by exercise
of the power of eminent domain, or otherwise;
(D)(2) The actual acquisition cost, not including periodic
rental fees, of rights-of-way, trailways, or other land rights
held, or, with respect to a natural gas company, projected to be
held at the date certain, by virtue of easements, leases, or other
forms of grants of rights as to usage;
(E)(3) The original cost of all other kinds and classes of
property used and useful, or, with respect to a natural gas
company, projected to be used and useful at the date certain, in
the rendition of service to the public. Such original costs of
property, other than land owned in fee, shall be the cost, as
determined to be reasonable by the commission, to the person that
first dedicated or dedicates the property to the public use and
shall be set forth in property accounts and subaccounts as
prescribed by the commission. To the extent that the costs of
property comprising a coal research and development facility, as
defined in section 1555.01 of the Revised Code, or a coal
development project, as defined in section 1551.30 of the Revised
Code, have been allowed for recovery as Ohio coal research and
development costs under section 4905.304 of the Revised Code, none
of those costs shall be included as a cost of property under this
division.
(F)(4) The cost of property constituting all or part of a
project leased to or used by the utility, or, with respect to a
natural gas company, projected to be leased to or used by the
utility at the date certain, under Chapter 165., 3706., 6121., or
6123. of the Revised Code and not included under division
(E)(C)(3) of this section exclusive of any interest directly or
indirectly paid by the utility with respect thereto whether or not
capitalized;
(G)(5) In the discretion of the commission, the cost to a
utility, in an amount determined to be reasonable by the
commission, of property constituting all or part of a project
leased to the utility, or, with respect to a natural gas company,
projected to be leased to the utility at the date certain, under a
lease purchase agreement or a leaseback and not included under
division (E)(C)(3) of this section exclusive of any interest
directly or indirectly paid by the utility with respect thereto
whether or not capitalized;
(H)(6) The proper and adequate reserve for depreciation, as
determined to be reasonable by the commission;
(I)(7) Any sums of money or property that the company may
have received, or, with respect to a natural gas company, is
projected to receive, on or before the date certain, as total or
partial defrayal of the cost of its property;
(J)(8) The valuation of the property of the company, which
shall be the sum of the amounts contained in the report pursuant
to divisions (C), (D), (E), (F), and (G)(1) to (5) of this
section, less the sum of the amounts contained in the report
pursuant to divisions
(H)(C)(6) and (I)(7) of this section.
The report shall show separately the property used and useful
to such public utility or railroad in the furnishing of the
service to the public, and the property held by such public
utility or railroad for other purposes, and the property projected
to be used and useful to or held by a natural gas company, and
such other items as the commission considers proper. The
commission may require an additional report showing the extent to
which the property is used and useful, or, with respect to a
natural gas company, projected to be used and useful at the date
certain. Such reports shall be filed in the office of the
commission for the information of the governor and the general
assembly.
Sec. 4909.06. The investigation and report required by
section 4909.05 of the Revised Code shall show, when the public
utilities commission deems it necessary, the amounts, dates, and
rates of interest of all bonds outstanding against each public
utility or railroad, the property upon which such bonds are a
lien, the amounts paid for them, and, the original capital stock
and the moneys received by any such public utility or railroad by
reason of any issue of stock, bonds, or other securities. Such
report shall also show the net and gross receipts of such public
utility or railroad and the method by which moneys were expended
or paid out and the purpose of such payments. The commission may
prescribe the procedure to be followed in making the investigation
and valuation, the form in which the results of the ascertainment
of the value of each public utility or railroad shall be
submitted, and the classifications of the elements that constitute
the ascertained value. Such investigation shall also show the
value of the property of every public utility or railroad as a
whole, and if such property is in more than one county, the value
of its property in each of such counties.
"Valuation" and "value," as used in this section, may include
projected valuation and value, if applicable, because of a future
date certain under section 4909.15 of the Revised Code.
Sec. 4909.07. The public utilities commission, during the
making of the valuation provided for in sections 4909.04 to
4909.13, inclusive, of the Revised Code, and after its completion,
shall in like manner keep itself informed through its engineers,
experts, and other assistants of all extensions, improvements, or
other changes in the condition and value of the property of all
public utilities or railroads and shall ascertain the value of
such extensions, improvements, and changes. The commission shall,
as is required for the proper regulation of such public utilities
or railroads, revise and correct its valuations of property,
showing such revisions and corrections as a whole and as to each
county. Such revisions and corrections shall be filed in the same
manner as original reports.
"Valuation" and "value," as used in this section, may include
projected valuation and value, if applicable, because of a future
date certain under section 4909.15 of the Revised Code.
Sec. 4909.08. When the public utilities commission has
completed the valuation of the property of any public utility or
railroad and before such valuation becomes final, it shall give
notice by registered letter to such public utility or railroad,
and if a substantial portion of said public utility or railroad is
situated in a municipal corporation, then to the mayor of such
municipal corporation, stating the valuations placed upon the
several kinds and classes of property of such public utility or
railroad and upon the property as a whole and give such further
notice by publication or otherwise as it shall deem necessary to
appraise apprise the public of such valuation. If, within thirty
days after such notification, no protest has been filed with the
commission, such valuation becomes final. If notice of protest has
been filed by any public utility or railroad, the commission shall
fix a time for hearing such protest and shall consider at such
hearing any matter material thereto presented by such public
utility, railroad, or municipal corporation, in support of its
protest or by any representative of the public against such
protest. If, after the hearing of any protest of any valuation so
fixed, the commission is of the opinion that its inventory is
incomplete or inaccurate or that its valuation is incorrect, it
shall make such changes as are necessary and shall issue an order
making such corrected valuations final. A final valuation by the
commission and all classifications made for the ascertainment of
such valuations shall be public and are prima-facie evidence
relative to the value of the property.
"Valuation" and "value," as used in this section, may include
projected valuation and value, if applicable, because of a future
date certain under section 4909.15 of the Revised Code.
Sec. 4909.15. (A) The public utilities commission, when
fixing and determining just and reasonable rates, fares, tolls,
rentals, and charges, shall determine:
(1) The valuation as of the date certain of the property of
the public utility used and useful in rendering the public utility
service for which rates are to be fixed and determined. The
valuation so determined shall be the total value as set forth in
division (J)(C)(8) of section 4909.05 of the Revised Code, and a
reasonable allowance for materials and supplies and cash working
capital, as determined by the commission.
The commission, in its discretion, may include in the
valuation a reasonable allowance for construction work in progress
but, in no event, may such an allowance be made by the commission
until it has determined that the particular construction project
is at least seventy-five per cent complete.
In determining the percentage completion of a particular
construction project, the commission shall consider, among other
relevant criteria, the per cent of time elapsed in construction;
the per cent of construction funds, excluding allowance for funds
used during construction, expended, or obligated to such
construction funds budgeted where all such funds are adjusted to
reflect current purchasing power; and any physical inspection
performed by or on behalf of any party, including the commission's
staff.
A reasonable allowance for construction work in progress
shall not exceed ten per cent of the total valuation as stated in
this division, not including such allowance for construction work
in progress.
Where the commission permits an allowance for construction
work in progress, the dollar value of the project or portion
thereof included in the valuation as construction work in progress
shall not be included in the valuation as plant in service until
such time as the total revenue effect of the construction work in
progress allowance is offset by the total revenue effect of the
plant in service exclusion. Carrying charges calculated in a
manner similar to allowance for funds used during construction
shall accrue on that portion of the project in service but not
reflected in rates as plant in service, and such accrued carrying
charges shall be included in the valuation of the property at the
conclusion of the offset period for purposes of division (J)(C)(8)
of section 4909.05 of the Revised Code.
From and after April 10, 1985, no allowance for construction
work in progress as it relates to a particular construction
project shall be reflected in rates for a period exceeding
forty-eight consecutive months commencing on the date the initial
rates reflecting such allowance become effective, except as
otherwise provided in this division.
The applicable maximum period in rates for an allowance for
construction work in progress as it relates to a particular
construction project shall be tolled if, and to the extent, a
delay in the in-service date of the project is caused by the
action or inaction of any federal, state, county, or municipal
agency having jurisdiction, where such action or inaction relates
to a change in a rule, standard, or approval of such agency, and
where such action or inaction is not the result of the failure of
the utility to reasonably endeavor to comply with any rule,
standard, or approval prior to such change.
In the event that such period expires before the project goes
into service, the commission shall exclude, from the date of
expiration, the allowance for the project as construction work in
progress from rates, except that the commission may extend the
expiration date up to twelve months for good cause shown.
In the event that a utility has permanently canceled,
abandoned, or terminated construction of a project for which it
was previously permitted a construction work in progress
allowance, the commission immediately shall exclude the allowance
for the project from the valuation.
In the event that a construction work in progress project
previously included in the valuation is removed from the valuation
pursuant to this division, any revenues collected by the utility
from its customers after April 10, 1985, that resulted from such
prior inclusion shall be offset against future revenues over the
same period of time as the project was included in the valuation
as construction work in progress. The total revenue effect of such
offset shall not exceed the total revenues previously collected.
In no event shall the total revenue effect of any offset or
offsets provided under division (A)(1) of this section exceed the
total revenue effect of any construction work in progress
allowance.
(2) A fair and reasonable rate of return to the utility on
the valuation as determined in division (A)(1) of this section;
(3) The dollar annual return to which the utility is entitled
by applying the fair and reasonable rate of return as determined
under division (A)(2) of this section to the valuation of the
utility determined under division (A)(1) of this section;
(4) The cost to the utility of rendering the public utility
service for the test period less the total of any interest on cash
or credit refunds paid, pursuant to section 4909.42 of the Revised
Code, by the utility during the test period.
(a) Federal, state, and local taxes imposed on or measured by
net income may, in the discretion of the commission, be computed
by the normalization method of accounting, provided the utility
maintains accounting reserves that reflect differences between
taxes actually payable and taxes on a normalized basis, provided
that no determination as to the treatment in the rate-making
process of such taxes shall be made that will result in loss of
any tax depreciation or other tax benefit to which the utility
would otherwise be entitled, and further provided that such tax
benefit as redounds to the utility as a result of such a
computation may not be retained by the company, used to fund any
dividend or distribution, or utilized for any purpose other than
the defrayal of the operating expenses of the utility and the
defrayal of the expenses of the utility in connection with
construction work.
(b) The amount of any tax credits granted to an electric
light company under section 5727.391 of the Revised Code for Ohio
coal burned prior to January 1, 2000, shall not be retained by the
company, used to fund any dividend or distribution, or utilized
for any purposes other than the defrayal of the allowable
operating expenses of the company and the defrayal of the
allowable expenses of the company in connection with the
installation, acquisition, construction, or use of a compliance
facility. The amount of the tax credits granted to an electric
light company under that section for Ohio coal burned prior to
January 1, 2000, shall be returned to its customers within three
years after initially claiming the credit through an offset to the
company's rates or fuel component, as determined by the
commission, as set forth in schedules filed by the company under
section 4905.30 of the Revised Code. As used in division
(A)(4)(c)(b) of this section, "compliance facility" has the same
meaning as in section 5727.391 of the Revised Code.
(B) The commission shall compute the gross annual revenues to
which the utility is entitled by adding the dollar amount of
return under division (A)(3) of this section to the cost of
rendering the public utility service for the test period under
division (A)(4) of this section.
(C) The test period, unless otherwise ordered by the
commission, shall be the twelve-month period beginning six months
prior to the date the application is filed and ending six months
subsequent to that date. In no event shall the test period end
more than nine months subsequent to the date the application is
filed. The Except as provided in division (D) of this section, the
revenues and expenses of the utility shall be determined during
the test period. The date certain shall be not later than the date
of filing, except that it shall be, for a natural gas company, not
later than the last day of the test period.
(D) A natural gas company may propose adjustments to the
revenues and expenses to be determined under division (C) of this
section for any changes that are, during the test period or the
twelve-month period immediately following the test period,
reasonably expected to occur. The natural gas company shall
identify and quantify, individually, any proposed adjustments. The
commission shall incorporate the proposed adjustments into the
determination if the adjustments are reasonable.
(E) When the commission is of the opinion, after hearing and
after making the determinations under divisions (A) and (B) of
this section, that any rate, fare, charge, toll, rental, schedule,
classification, or service, or any joint rate, fare, charge, toll,
rental, schedule, classification, or service rendered, charged,
demanded, exacted, or proposed to be rendered, charged, demanded,
or exacted, is, or will be, unjust, unreasonable, unjustly
discriminatory, unjustly preferential, or in violation of law,
that the service is, or will be, inadequate, or that the maximum
rates, charges, tolls, or rentals chargeable by any such public
utility are insufficient to yield reasonable compensation for the
service rendered, and are unjust and unreasonable, the commission
shall:
(1) With due regard among other things to the value of all
property of the public utility actually used and useful for the
convenience of the public as determined under division (A)(1) of
this section, excluding from such value the value of any franchise
or right to own, operate, or enjoy the same in excess of the
amount, exclusive of any tax or annual charge, actually paid to
any political subdivision of the state or county, as the
consideration for the grant of such franchise or right, and
excluding any value added to such property by reason of a monopoly
or merger, with due regard in determining the dollar annual return
under division (A)(3) of this section to the necessity of making
reservation out of the income for surplus, depreciation, and
contingencies, and;
(2) With due regard to all such other matters as are proper,
according to the facts in each case,
(a) Including a fair and reasonable rate of return determined
by the commission with reference to a cost of debt equal to the
actual embedded cost of debt of such public utility,
(b) But not including the portion of any periodic rental or
use payments representing that cost of property that is included
in the valuation report under divisions (F)(C)(4) and (G)(5) of
section 4909.05 of the Revised Code, fix and determine the just
and reasonable rate, fare, charge, toll, rental, or service to be
rendered, charged, demanded, exacted, or collected for the
performance or rendition of the service that will provide the
public utility the allowable gross annual revenues under division
(B) of this section, and order such just and reasonable rate,
fare, charge, toll, rental, or service to be substituted for the
existing one. After such determination and order no change in the
rate, fare, toll, charge, rental, schedule, classification, or
service shall be made, rendered, charged, demanded, exacted, or
changed by such public utility without the order of the
commission, and any other rate, fare, toll, charge, rental,
classification, or service is prohibited.
(E)(F) Upon application of any person or any public utility,
and after notice to the parties in interest and opportunity to be
heard as provided in Chapters 4901., 4903., 4905., 4907., 4909.,
4921., and 4923. of the Revised Code for other hearings, has been
given, the commission may rescind, alter, or amend an order fixing
any rate, fare, toll, charge, rental, classification, or service,
or any other order made by the commission. Certified copies of
such orders shall be served and take effect as provided for
original orders.
Sec. 4909.156. In fixing the just, reasonable, and
compensatory rates, joint rates, tolls, classifications, charges,
or rentals to be observed and charged for service by any public
utility, the public utilities commission shall, in action upon an
application filed pursuant to section 4909.18 of the Revised Code,
require a public utility to file a report showing the
proportionate amounts of the valuation of the property of the
utility, as determined under section 4909.05 or the Revised Code,
and the proportionate amounts of the revenues and expenses of the
utility that are proposed to be considered as attributable to the
service area involved in the application.
"Valuation," as used in this section, may include projected
valuation, if applicable, because of a future date certain under
section 4909.15 of the Revised Code.
Sec. 4909.17. No rate, joint rate, toll, classification,
charge, or rental, no change in any rate, joint rate, toll,
classification, charge, or rental, and no regulation or practice
affecting any rate, joint rate, toll, classification, charge, or
rental of a public utility shall become effective until the public
utilities commission, by order, determines it to be just and
reasonable, except as provided in this section and sections
4909.18 and, 4909.19, 4929.05, 4929.11, and 4929.111 of the
Revised Code. Such sections do not apply to any rate, joint rate,
toll, classification, charge, or rental, or any regulation or
practice affecting the same, of railroads, street and electric
railways, motor transportation companies, and pipe line companies.
Sec. 4909.18. Any public utility desiring to establish any
rate, joint rate, toll, classification, charge, or rental, or to
modify, amend, change, increase, or reduce any existing rate,
joint rate, toll, classification, charge, or rental, or any
regulation or practice affecting the same, shall file a written
application with the public utilities commission. Except for
actions under section 4909.16 of the Revised Code, no public
utility may issue the notice of intent to file an application
pursuant to division (B) of section 4909.43 of the Revised Code to
increase any existing rate, joint rate, toll, classification,
charge, or rental, until a final order under this section has been
issued by the commission on any pending prior application to
increase the same rate, joint rate, toll, classification, charge,
or rental or until two hundred seventy-five days after filing such
application, whichever is sooner. Such application shall be
verified by the president or a vice-president and the secretary or
treasurer of the applicant. Such application shall contain a
schedule of the existing rate, joint rate, toll, classification,
charge, or rental, or regulation or practice affecting the same, a
schedule of the modification amendment, change, increase, or
reduction sought to be established, and a statement of the facts
and grounds upon which such application is based. If such
application proposes a new service or the use of new equipment, or
proposes the establishment or amendment of a regulation, the
application shall fully describe the new service or equipment, or
the regulation proposed to be established or amended, and shall
explain how the proposed service or equipment differs from
services or equipment presently offered or in use, or how the
regulation proposed to be established or amended differs from
regulations presently in effect. The application shall provide
such additional information as the commission may require in its
discretion. If the commission determines that such application is
not for an increase in any rate, joint rate, toll, classification,
charge, or rental, the commission may permit the filing of the
schedule proposed in the application and fix the time when such
schedule shall take effect. If it appears to the commission that
the proposals in the application may be unjust or unreasonable,
the commission shall set the matter for hearing and shall give
notice of such hearing by sending written notice of the date set
for the hearing to the public utility and publishing notice of the
hearing one time in a newspaper of general circulation in each
county in the service area affected by the application. At such
hearing, the burden of proof to show that the proposals in the
application are just and reasonable shall be upon the public
utility. After such hearing, the commission shall, where
practicable, issue an appropriate order within six months from the
date the application was filed.
If the commission determines that said application is for an
increase in any rate, joint rate, toll, classification, charge, or
rental there shall also, unless otherwise ordered by the
commission, be filed with the application in duplicate the
following exhibits:
(A) A report of its property used and useful in rendering the
service referred to in such application, as provided in section
4909.05 of the Revised Code;
(B) A complete operating statement of its last fiscal year,
showing in detail all its receipts, revenues, and incomes from all
sources, all of its operating costs and other expenditures, and
any analysis such public utility deems applicable to the matter
referred to in said application;
(C) A statement of the income and expense anticipated under
the application filed;
(D) A statement of financial condition summarizing assets,
liabilities, and net worth;
(E) A proposed notice for newspaper publication fully
disclosing the substance of the application. The notice shall
prominently state that any person, firm, corporation, or
association may file, pursuant to section 4909.19 of the Revised
Code, an objection to such increase which may allege that such
application contains proposals that are unjust and discriminatory
or unreasonable. The notice shall further include the average
percentage increase in rate that a representative industrial,
commercial, and residential customer will bear should the increase
be granted in full;
(F) Such other information as the commission may require in
its discretion.
Sec. 4909.19. Upon the filing of any application for
increase provided for by section 4909.18 of the Revised Code the
public utility shall forthwith publish the substance and prayer of
such application, in a form approved by the public utilities
commission, once a week for three consecutive weeks in a newspaper
published and in general circulation throughout the territory in
which such public utility operates and affected by the matters
referred to in said application, and the public utilities
commission shall at once cause an investigation to be made of the
facts set forth in said application and the exhibits attached
thereto, and of the matters connected therewith. Within a
reasonable time as determined by the commission after the filing
of such application, a written report shall be made and filed with
the commission, a copy of which shall be sent by certified mail to
the applicant, the mayor of any municipal corporation affected by
the application, and to such other persons as the commission deems
interested. If no objection to such report is made by any party
interested within thirty days after such filing and the mailing of
copies thereof, the commission shall fix a date within ten days
for the final hearing upon said application, giving notice thereof
to all parties interested. At such hearing the commission shall
consider the matters set forth in said application and make such
order respecting the prayer thereof as to it seems just and
reasonable.
If objections are filed with the commission, the commission
shall cause a pre-hearing conference to be held between all
parties, intervenors, and the commission staff in all cases
involving more than one hundred thousand customers.
If objections are filed with the commission within thirty
days after the filing of such report, the application shall be
promptly set down for hearing of testimony before the commission
or be forthwith referred to an attorney examiner designated by the
commission to take all the testimony with respect to the
application and objections which may be offered by any interested
party. The commission shall also fix the time and place to take
testimony giving ten days' written notice of such time and place
to all parties. The taking of testimony shall commence on the date
fixed in said notice and shall continue from day to day until
completed. The attorney examiner may, upon good cause shown, grant
continuances for not more than three days, excluding Saturdays,
Sundays, and holidays. The commission may grant continuances for a
longer period than three days upon its order for good cause shown.
At any hearing involving rates or charges sought to be increased,
the burden of proof to show that the increased rates or charges
are just and reasonable shall be on the public utility.
When the taking of testimony is completed, a full and
complete record of such testimony noting all objections made and
exceptions taken by any party or counsel, shall be made, signed by
the attorney examiner, and filed with the commission. Prior to the
formal consideration of the application by the commission and the
rendition of any order respecting the prayer of the application, a
quorum of the commission shall consider the recommended opinion
and order of the attorney examiner, in an open, formal, public
proceeding in which an overview and explanation is presented
orally. Thereafter, the commission shall make such order
respecting the prayer of such application as seems just and
reasonable to it.
In all proceedings before the commission in which the taking
of testimony is required, except when heard by the commission,
attorney examiners shall be assigned by the commission to take
such testimony and fix the time and place therefor, and such
testimony shall be taken in the manner prescribed in this section.
All testimony shall be under oath or affirmation and taken down
and transcribed by a reporter and made a part of the record in the
case. The commission may hear the testimony or any part thereof in
any case without having the same referred to an attorney examiner
and may take additional testimony. Testimony shall be taken and a
record made in accordance with such general rules as the
commission prescribes and subject to such special instructions in
any proceedings as it, by order, directs.
Sec. 4928.18. (A) Notwithstanding division
(D)(E)(2)(a) of
section 4909.15 of the Revised Code, nothing in this chapter
prevents the public utilities commission from exercising its
authority under Title XLIX of the Revised Code to protect
customers of retail electric service supplied by an electric
utility from any adverse effect of the utility's provision of a
product or service other than retail electric service.
(B) The commission has jurisdiction under section 4905.26 of
the Revised Code, upon complaint of any person or upon complaint
or initiative of the commission on or after the starting date of
competitive retail electric service, to determine whether an
electric utility or its affiliate has violated any provision of
section 4928.17 of the Revised Code or an order issued or rule
adopted under that section. For this purpose, the commission may
examine such books, accounts, or other records kept by an electric
utility or its affiliate as may relate to the businesses for which
corporate separation is required under section 4928.17 of the
Revised Code, and may investigate such utility or affiliate
operations as may relate to those businesses and investigate the
interrelationship of those operations. Any such examination or
investigation by the commission shall be governed by Chapter 4903.
of the Revised Code.
(C) In addition to any remedies otherwise provided by law,
the commission, regarding a determination of a violation pursuant
to division (B) of this section, may do any of the following:
(1) Issue an order directing the utility or affiliate to
comply;
(2) Modify an order as the commission finds reasonable and
appropriate and order the utility or affiliate to comply with the
modified order;
(3) Suspend or abrogate an order, in whole or in part;
(4) Issue an order that the utility or affiliate pay
restitution to any person injured by the violation or failure to
comply;
(D) In addition to any remedies otherwise provided by law,
the commission, regarding a determination of a violation pursuant
to division (B) of this section and commensurate with the severity
of the violation, the source of the violation, any pattern of
violations, or any monetary damages caused by the violation, may
do either of the following:
(1) Impose a forfeiture on the utility or affiliate of up to
twenty-five thousand dollars per day per violation. The recovery
and deposit of any such forfeiture shall be subject to sections
4905.57 and 4905.59 of the Revised Code.
(2) Regarding a violation by an electric utility relating to
a corporate separation plan involving competitive retail electric
service, suspend or abrogate all or part of an order, to the
extent it is in effect, authorizing an opportunity for the utility
to receive transition revenues under a transition plan approved by
the commission under section 4928.33 of the Revised Code.
Corporate separation under this section does not prohibit the
common use of employee benefit plans, facilities, equipment, or
employees, subject to proper accounting and the code of conduct
ordered by the commission as provided in division (A)(1) of this
section.
(E) Section 4905.61 of the Revised Code applies in the case
of any violation of section 4928.17 of the Revised Code or of any
rule adopted or order issued under that section.
Sec. 4929.05. (A) As part of an application filed pursuant
to section 4909.18 of the Revised Code, a A natural gas company
may request approval of an alternative rate plan by filing an
application under section 4909.18 of the Revised Code, regardless
of whether the application is for an increase in rates. After
notice, investigation, and hearing, and after determining just and
reasonable rates and charges for the natural gas company pursuant
to section 4909.15 of the Revised Code, the public utilities
commission shall authorize the applicant to implement an
alternative rate plan if the natural gas company has made a
showing and the commission finds that both of the following
conditions are met:
(1) The natural gas company is in compliance with section
4905.35 of the Revised Code and is in substantial compliance with
the policy of this state specified in section 4929.02 of the
Revised Code;
(2) The natural gas company is expected to continue to be in
substantial compliance with the policy of this state specified in
section 4929.02 of the Revised Code after implementation of the
alternative rate plan.
(B) The applicant shall have the burden of proof under this
section.
(C) No request may be made under this section prior to one
hundred eighty days after the effective date of this section.
Sec. 4929.051. (A) An alternative rate plan filed by a
natural gas company under section 4929.05 of the Revised Code and
proposing to initiate or continue a revenue decoupling mechanism
may shall be considered an application not for an increase in
rates if the rates, joint rates, tolls, classifications, charges,
or rentals are based upon the billing determinants and revenue
requirement authorized by the public utilities commission in the
company's most recent rate case proceeding and the plan also
establishes, continues, or expands an energy efficiency or energy
conservation program.
(B) An alternative rate plan filed by a natural gas company
under section 4929.05 of the Revised Code and seeking
authorization to continue a previously approved alternative rate
plan shall be considered an application not for an increase in
rates.
Sec. 4929.11. Nothing in the Revised Code prohibits (A) Upon
an application filed under this section, and the public utilities
commission may allow, any automatic adjustment mechanism or device
in a natural gas company's rate schedules that allows a natural
gas company's rates or charges for a regulated service or goods to
fluctuate automatically in accordance with changes in a specified
cost or costs.
(B) Upon an application filed under section 4909.18 or
4929.05 of the Revised Code, the commission may allow any
automatic adjustment mechanism or device as described in division
(A) of this section.
Sec. 4929.111. (A) A natural gas company may file an
application with the public utilities commission under section
4909.18, 4929.05, or 4929.11 of the Revised Code to implement a
capital expenditure program for any of the following:
(1) Any infrastructure expansion, infrastructure improvement,
or infrastructure replacement program;
(2) Any program to install, upgrade, or replace information
technology systems;
(3) Any program reasonably necessary to comply with any
rules, regulations, or orders of the commission or other
governmental entity having jurisdiction.
(B) If the commission finds that the capital expenditure
program is consistent with the natural gas company's obligation
under section 4905.22 of the Revised Code to furnish necessary and
adequate services and facilities, the commission shall approve the
application.
(C) In approving an application under division (B) of this
section, the commission shall authorize the natural gas company to
defer, for subsequent recovery in an application that the natural
gas company may file under section 4909.18, 4929.05, or 4929.11 of
the Revised Code, both of the following:
(1) A regulatory asset for the post-in-service carrying costs
on that portion of the assets of the capital expenditure program
that are placed in service but not reflected in rates as plant in
service;
(2) A regulatory asset for the incremental depreciation
directly attributable to the capital expenditure program and the
property tax expense directly attributable to the capital
expenditure program.
(D) The natural gas company may make any accounting accruals,
necessary to establish the regulatory assets authorized under
division (C) of this section, in addition to any allowance for
funds used during construction.
(E)(1) Any accrual for recovery under division (C) of this
section shall be calculated in accordance with the system of
accounts established by the commission under section 4905.13 of
the Revised Code.
(2) The natural gas company shall calculate the
post-in-service carrying costs, described in division (C)(1) of
this section, for every investment in an asset of the capital
expenditure program. This calculation shall be based on the cost
of long-term debt incurred by the natural gas company.
(F) Any accruals for recovery under division (C) of this
section shall commence when the assets of the capital expenditure
program are placed in service and shall cease when rates
reflecting the cost of those assets are effective.
Sec. 4935.04. (A) As used in this chapter:
(1) "Major electric utility facility" means:
(a) An an electric transmission line and associated
facilities of a design capacity of one hundred twenty-five
kilovolts or more;
(b) A gas or natural gas transmission line and associated
facilities designed for, or capable of, transporting gas or
natural gas at pressures in excess of one hundred twenty-five
pounds per square inch.
"Major electric utility facility" does not include electric,
gas, or natural gas distributing lines and gas or natural gas
gathering lines and associated facilities as defined by the public
utilities commission; facilities owned or operated by industrial
firms, persons, or institutions that produce or transmit gas or
natural gas, or electricity primarily for their own use or as a
byproduct of their operations; gas or natural gas transmission
lines and associated facilities over which an agency of the United
States has certificate jurisdiction; facilities owned or operated
by a person furnishing gas or natural gas directly to fifteen
thousand or fewer customers within this state.
(2) "Person" has the meaning set forth in section 4906.01 of
the Revised Code.
(B) Each person owning or operating a gas or natural gas
transmission line and associated facilities within this state over
which an agency of the United States has certificate jurisdiction
shall furnish to the commission a copy of the energy information
filed by the person with that agency of the United States.
(C) Each person owning or operating a major electric utility
facility within this state, or furnishing gas, natural gas, or
electricity directly to more than fifteen thousand customers
within this state annually shall furnish a report to the
commission for its review. The report shall be termed the
long-term forecast report and shall contain:
(1) A year-by-year, ten-year forecast of annual energy
demand, peak load, reserves, and a general description of the
resource plan to meet demand;
(2) A range of projected loads during the period;
(3) A description of major electric utility facilities
planned to be added or taken out of service in the next ten years,
including, to the extent the information is available, prospective
sites for transmission line locations;
(4) For gas and natural gas, a projection of anticipated
supply, supply prices, and sources of supply over the forecast
period;
(5) A description of proposed changes in the transmission
system planned for the next five years;
(6)(5) A month-by-month forecast of both energy demand and
peak load for electric utilities, and gas sendout for gas and
natural gas utilities, for the next two years. The report shall
describe the major electric utility facilities that, in the
judgment of such person, will be required to supply system demands
during the forecast period. The report from a gas or natural gas
utility shall cover the ten- and five-year periods next succeeding
the date of the report, and the report from an electric utility
shall cover the twenty-, ten-, and five-year periods next
succeeding the date of the report. Each report shall be made
available to the public and furnished upon request to municipal
corporations and governmental agencies charged with the duty of
protecting the environment or of planning land use. The report
shall be in such form and shall contain such information as may be
prescribed by the commission.
Each person not owning or operating a major utility facility
within this state and serving fifteen thousand or fewer gas or
natural gas, or electric customers within this state shall furnish
such information as the commission requires.
(D) The commission shall:
(1) Review and comment on the reports filed under division
(C) of this section, and make the information contained in the
reports readily available to the public and other interested
government agencies;
(2) Compile and publish each year the general locations of
proposed and existing transmission line routes within its
jurisdiction as identified in the reports filed under division (C)
of this section, identifying the general location of such sites
and routes and the approximate year when construction is expected
to commence, and to make such information readily available to the
public, to each newspaper of daily or weekly circulation within
the area affected by the proposed site and route, and to
interested federal, state, and local agencies;
(3) Hold a public hearing:
(a) On the first long-term forecast report filed after
January 11, 1983;
(b) At least once in every five years, on the latest report
furnished by any person subject to this section;
(c)(b) On the latest report furnished by any person subject
to this section if the report contains a substantial change from
the preceding report furnished by that person. "Substantial
change" includes, but is not limited to:
(i) A change in forecasted peak loads or energy consumption
over the forecast period of greater than an average of one-half of
one per cent per year;
(ii) Demonstration of good cause to the commission by an
interested party.
The commission shall fix a time for the hearing, which shall
be not later than ninety days after the report is filed, and
publish notice of the date, time of day, and location of the
hearing in a newspaper of general circulation in each county in
which the person furnishing the report has or intends to locate a
major electric utility facility and will provide service during
the period covered by the report. The notice shall be published
not less than fifteen nor more than thirty days before the hearing
and shall state the matters to be considered.
Absent a showing of good cause, the commission shall not hold
hearings under division (D)(3) of this section with respect to
persons who, as the primary purpose of their business, furnish
gas
or natural gas, or electricity directly to fifteen thousand or
fewer customers within this state solely for direct consumption by
those customers.
(4) Require such information from persons subject to its
jurisdiction as necessary to assist in the conduct of hearings and
any investigation or studies it may undertake;
(5) Conduct any studies or investigations that are necessary
or appropriate to carry out its responsibilities under this
section.
(E)(1) The scope of the hearing held under division (D)(3) of
this section shall be limited to issues relating to forecasting.
The power siting board, the office of consumers' counsel, and all
other persons having an interest in the proceedings shall be
afforded the opportunity to be heard and to be represented by
counsel. The commission may adjourn the hearing from time to time.
(2) The hearing shall include, but not be limited to, a
review of:
(a) The projected loads and energy requirements for each year
of the period;
(b) The estimated installed capacity and supplies to meet the
projected load requirements.
(F) Based upon the report furnished pursuant to division (C)
of this section and the hearing record, the commission, within
ninety days from the close of the record in the hearing, shall
determine if:
(1) All information relating to current activities,
facilities agreements, and published energy policies of the state
has been completely and accurately represented;
(2) The load requirements are based on substantially accurate
historical information and adequate methodology;
(3) The forecasting methods consider the relationships
between price and energy consumption;
(4) The report identifies and projects reductions in energy
demands due to energy conservation measures in the industrial,
commercial, residential, transportation, and energy production
sectors in the service area;
(5) Utility company forecasts of loads and resources are
reasonable in relation to population growth estimates made by
state and federal agencies, transportation, and economic
development plans and forecasts, and make recommendations where
possible for necessary and reasonable alternatives to meet
forecasted electric power demand;
(6) The report considers plans for expansion of the regional
power grid and the planned facilities of other utilities in the
state;
(7) All assumptions made in the forecast are reasonable and
adequately documented.
(G) The commission shall adopt rules under section 111.15 of
the Revised Code to establish criteria for evaluating the
long-term forecasts of needs for gas and electric transmission
service, to conduct hearings held under this section, to establish
reasonable fees to defray the direct cost of the hearings and the
review process, and such other rules as are necessary and
convenient to implement this section.
(H) The hearing record produced under this section and the
determinations of the commission shall be introduced into evidence
and shall be considered in determining the basis of need for power
siting board deliberations under division (A)(1) of section
4906.10 of the Revised Code. The hearing record produced under
this section shall be introduced into evidence and shall be
considered by the public utilities commission in its initiation of
programs, examinations, and findings under section 4905.70 of the
Revised Code, and shall be considered in the commission's
determinations with respect to the establishment of just and
reasonable rates under section 4909.15 of the Revised Code and
financing utility facilities and authorizing issuance of all
securities under sections 4905.40, 4905.401, 4905.41, and 4905.42
of the Revised Code. The forecast findings also shall serve as the
basis for all other energy planning and development activities of
the state government where electric and gas data are is required.
(I)(1) No court other than the supreme court shall have power
to review, suspend, or delay any determination made by the
commission under this section, or enjoin, restrain, or interfere
with the commission in the performance of official duties. A writ
of mandamus shall not be issued against the commission by any
court other than the supreme court.
(2) A final determination made by the commission shall be
reversed, vacated, or modified by the supreme court on appeal, if,
upon consideration of the record, such court is of the opinion
that such determination was unreasonable or unlawful.
The proceeding to obtain such reversal, vacation, or
modification shall be by notice of appeal, filed with the
commission by any party to the proceeding before it, against the
commission, setting forth the determination appealed from and
errors complained of. The notice of appeal shall be served, unless
waived, upon the commission by leaving a copy at the office of the
chairperson of the commission at Columbus. The court may permit an
interested party to intervene by cross-appeal.
(3) No proceeding to reverse, vacate, or modify a
determination of the commission is commenced unless the notice of
appeal is filed within sixty days after the date of the
determination.
Section 2. That existing sections 4903.083, 4905.302,
4906.06, 4909.05, 4909.06, 4909.07, 4909.08, 4909.15, 4909.156,
4909.17, 4909.18, 4909.19, 4928.18, 4929.05, 4929.051, 4929.11,
and 4935.04 of the Revised Code are hereby repealed.
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