Provides that every gas or electric rate schedule, which is based on projections of revenues, expenditures and utility operations for more than 18 months, shall be annually reviewed by the public service commission; such review proceeding shall include all the parties involved in the proceeding at which such schedule was originally approved.
TITLE OF BILL: An act to amend the public service law, in relation to requiring annual reviews of multi-year rate plans
PURPOSE OR GENERAL IDEA OF BILL: In its January 2007 report, the Assembly Queens Power Outage Task Force recommended several measures to improve oversight of utilities and prevent future blackouts. This bill will restore utility accountability by requiring annual reviews of utility performance under multi-year rate plans.
SUMMARY OF PROVISIONS: Bill §1 amends paragraph (f) of subdivision 12 of §66 of the Public Service Law to require that any utility rate filing based on future revenues, expenditures and operations for a period of more than 18 months must also include annual revenue and expenditure projections and benchmarks for maintenance and operations, service quality and other items deemed appropriate by the Public Service Commission (PSC). The PSC shall commence a proceeding to review the continued validity of such projections not more than 3 months after the anniversary date of the date such schedule became effective. Participation in this proceeding would be open to each party to the original proceeding and any new parties that are likely to contribute to the development of a complete record. Similar review proceedings shall be commenced in subsequent years of the multi-year rate plan.
EFFECTS OF PRESENT LAW WHICH THIS BILL WOULD ALTER: Current law does not address the diminution of opportunities for PSC and public oversight created by the use of multi-year rate plans.
JUSTIFICATION: Last summer, the western part of Queens suffered a massive power outage that lasted 9 days. The Assembly Queens Power Outage Task Force studied the outage's causes and the inadequate responses by the company responsible for the transmission and distribution system, Consolidated Edison, and by the Public Service Commission. One underlying cause of this debacle was found to be the reliance by New York's utility regulators on antiquated laws, regulations and policies that let companies engaged in energy transmission and distribution operate without effective oversight.
The Task Force found that the increasing use of negotiated multi-year rate plans was undercutting the ability of the PSC, its staff and other interested members of the public to oversee the operations of regulated public utilities. Historically, one of the mainstays of utility regulation was the practice of conducting annual rate cases before the PSC with full involvement of the Consumer Protection Board and other public intervenors. This practice promoted regular, timely and effective feedback on utilities' activities, undertakings and expenditures.
In recent years, the PSC's growing reliance on multi-year rate plans has reduced both the frequency and effectiveness of outside scrutiny of utility performance. The Task Force found that this could be an underlying factor in Consolidated Edison's decisions to defer or minimize maintenance expenditures, potentially compromising the safety and reliability of the grid. This bill will restore the prior practice of more regular and thorough reviews of utility actions under multi-year rate plans, resulting in more attention to service reliability and safety issues.
PRIOR LEGISLATIVE HISTORY: None.
FISCAL IMPLICATIONS FOR STATE AND LOCAL GOVERNMENTS: None.
EFFECTIVE DATE: 180th day after enactment; provided that the Public Service Commission is immediately authorized and directed to promulgate rules and take other actions needed to fully implement the bill on such date.
STATE OF NEW YORK ________________________________________________________________________ 1979 2011-2012 Regular Sessions IN SENATE January 14, 2011 ___________Introduced by Sen. GIANARIS -- read twice and ordered printed, and when printed to be committed to the Committee on Energy and Telecommuni- cations AN ACT to amend the public service law, in relation to requiring annual reviews of multi-year rate plans THE PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM- BLY, DO ENACT AS FOLLOWS: Section 1. Paragraph (f) of subdivision 12 of section 66 of the public service law, as amended by chapter 154 of the laws of 1989, is amended to read as follows: (f) Whenever there shall be filed with the commission by any utility any schedule stating a new rate or charge, or any change in any form of contract or agreement or any rule or regulation relating to any rate, charge or service, or in any general privilege or facility, the commis- sion may, at any time within sixty days from the date when such schedule would or has become effective, either upon complaint or upon its own initiative, and, if it so orders, without answer or other formal plead- ing by the utility, but upon reasonable notice, hold a hearing concern- ing the propriety of a change proposed by the filing. If such change is a major change, the commission shall hold such a hearing. Pending such hearing and decision thereon, the commission, upon filing with such schedule and delivering to the utility, a statement in writing of its reasons therefor, may suspend the operation of such schedule, but not for a longer period than one hundred and twenty days beyond the time when it would otherwise go into effect. After full hearing, whether completed before or after the schedule goes into effect, the commission may make such order in reference thereto as would be proper in a proceeding begun after the rate, charge, form of contract or agreement, rule, regulation, service, general privilege or facility had become effective. If any such hearing cannot be concluded within the period ofEXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets [ ] is old law to be omitted. LBD05105-01-1 S. 1979 2
suspension as above stated, the commission may extend the suspension for a further period, not exceeding six months. IF ANY SUCH SCHEDULE IS BASED ON PROJECTIONS OF REVENUES, EXPENDITURES AND UTILITY OPERATIONS FOR A PERIOD OF MORE THAN EIGHTEEN MONTHS, THE COMMISSION SHALL ORDER THAT SUCH SCHEDULE INCLUDE ANNUAL PROJECTIONS OR REVENUES AND EXPENDITURES AND BENCHMARKS FOR MAINTENANCE AND OPERATIONS, SERVICE QUALITY AND SUCH OTHER PROJECTIONS AS THE COMMISSION MAY DEEM APPROPRIATE, AND SHALL COMMENCE A PROCEEDING TO REVIEW THE CONTINUED VALIDITY OF SUCH PROJECTIONS NOT MORE THAN THREE MONTHS AFTER THE ANNI- VERSARY DATE OF THE DATE SUCH SCHEDULE BECAME EFFECTIVE. ALL PARTIES TO THE PROCEEDING AT WHICH THE SCHEDULE WAS ORIGINALLY CONSIDERED SHALL BE ENTITLED TO PARTY STATUS IN THE REVIEW PROCEEDING; PROVIDED, HOWEVER, THAT NOTHING IN THIS PARAGRAPH SHALL PRECLUDE THE ADMISSION OF ADDI- TIONAL PERSONS TO THE PROCEEDING IF THEIR INTERVENTION IS LIKELY TO CONTRIBUTE TO THE DEVELOPMENT OF A COMPLETE RECORD OR IS OTHERWISE FAIR AND IN THE PUBLIC INTEREST. UPON A DETERMINATION THAT ANY OF THE PROJECTIONS WAS NOT MET OR IS IN NEED OF RECONSIDERATION, THE COMMISSION MAY MAKE SUCH ORDERS AS IT DEEMS APPROPRIATE. A REVIEW PROCEEDING COMMENCED PURSUANT TO THIS PARAGRAPH MAY BE DEEMED TO CONSTITUTE A PROCEEDING UNDERTAKEN PURSUANT TO SUBDIVISION TWENTY OF THIS SECTION. SIMILAR REVIEW PROCEEDINGS SHALL BE COMMENCED NOT MORE THAN THREE MONTHS AFTER ANY SUBSEQUENT ANNIVERSARY DATE OF THE ORIGINAL SCHEDULE'S EFFEC- TIVE DATE, PROVIDED, HOWEVER, THAT SUCH PROCEEDINGS SHALL CONSIDER ANY REVISED PROJECTIONS ORDERED IN PRIOR REVIEW PROCEEDINGS. S 2. This act shall take effect on the one hundred eightieth day after it shall have become a law. Provided that the public service commission is immediately authorized and directed to take any and all actions, including but not limited to the promulgation of any necessary rules, necessary to fully implement the provisions of this act on its effective date.