§ 56-602. Conservation and ratemaking efficiency plans.
A. Notwithstanding any provision of law to the contrary, each natural gasutility shall have the option to file a conservation and ratemakingefficiency plan as provided in this chapter. Such a plan may include one ormore residential, small commercial, or small general service classes, butshall not apply to large commercial or large industrial classes of customers.Such plan shall include: (i) a normalization component that removes theeffect of weather from the determination of conservation and energyefficiency results; (ii) a decoupling mechanism; (iii) one or morecost-effective conservation and energy efficiency programs; (iv) provisionsto address the needs of low-income or low-usage residential customers; and(v) provisions to ensure that the rates and service to non-participatingclasses of customers are not adversely impacted. Such plan may also includeprovisions for phased or targeted implementation of rate or tariff designchanges, if any, or conservation and energy efficiency programs. TheCommission may approve such a plan after such notice and opportunity forhearing as the Commission may prescribe, subject to the provisions of thischapter. Nothing in this subsection shall prevent a natural gas utility fromamending a conservation and ratemaking efficiency plan by amending, altering,supplementing, or deleting one or more conservation or energy efficiencyprograms.
B. The Commission shall approve or deny, within 180 days, a natural gasutility's initial application for any revenue-neutral conservation andratemaking efficiency plan that allocates annual per-customer fixed costs onan intra-class basis in reliance upon a revenue study or class cost ofservice study supporting the rates in effect at the time the plan is filed. Aplan filed pursuant to this subsection shall not require the filing of ratecase schedules. The Commission shall approve or deny, within 120 days, anatural gas utility's application to amend a previously approved plan. TheCommission shall approve such a plan or amendment if it finds that the plan'sor amendment's proposed decoupling mechanism is revenue-neutral and isotherwise consistent with this chapter. If the Commission denies such a planor amendment, it shall set forth with specificity the reasons for such denialand the utility shall have the right to refile, without prejudice, an amendedplan or amendment within 60 days, and the Commission shall thereafter have 60days to approve or deny the amended plan or amendment. The time period forCommission review provided for in this subsection shall not apply if theconservation and ratemaking efficiency plan is filed in conjunction with arate case using the cost of service methodology set forth in § 56-235.2 or aperformance-based regulation plan authorized by § 56-235.6.
C. The Commission shall approve or deny, within 270 days, a natural gasutility's initial application for any revenue-neutral conservation andratemaking efficiency plan that allocates per-customer fixed costs on anintra-class basis according to a class cost of service study filed with theplan, when such plan is filed in conjunction with a rate case using the costof service methodology set forth in § 56-235.2 or a performance-basedregulation plan authorized by § 56-235.6. The Commission shall approve ordeny, within 120 days, a natural gas utility's application to amend a planpreviously approved pursuant to this subsection. The Commission shall approvesuch a plan or amendment if it finds that the plan's or amendment's proposeddecoupling mechanism is revenue-neutral, is consistent with this chapter, andis otherwise in the public interest, including any findings required by §56-235.2 or 56-235.6. If the Commission denies such a plan or amendment, itshall set forth with specificity the reasons for its denial and the utilityshall have the right to refile, without prejudice, an amended plan oramendment within 60 days; the Commission shall thereafter have 60 days toapprove or deny the amended plan or amendment.
D. The Commission shall allow any natural gas utility that implements aconservation and ratemaking efficiency plan under this chapter to recover, ona timely basis and through its regulated rates charged to its classes ofcustomers participating in the plan, its entire incremental costs associatedwith cost-effective conservation and energy efficiency programs that aredesigned to encourage the reduction of annualized, weather-normalized naturalgas consumption per customer. Ratemaking treatment may include placingappropriate capital expenditures for technology and program costs in therespective utility's rate base, deferral of such interim incremental costs(which costs would not be subject to an earnings test), or recovering theutility's technology and program costs through another ratemaking methodologyapproved by the Commission, such as a tracking mechanism. Such conservationand energy efficiency programs may also be jointly conducted or co-sponsoredwith other utilities, federal, state or local government agencies, nonprofitorganizations, trade associations, homebuilders, and other for-profitvendors. Incremental costs recovered pursuant to this subsection shall be inaddition to all other costs that the utility is permitted to recover, shallnot be considered an offset to other Commission-approved costs of service orrevenue requirements, and shall not be included in any computation relativeto a performance-based regulation plan revenue sharing mechanism.
E. The Commission shall require every natural gas utility operating under aconservation and ratemaking efficiency plan approved pursuant to this chapterto file annual reports showing the year over year weather-normalized use ofnatural gas on an average customer basis, by customer class, as well as theincremental, independently verified net economic benefits created by theutility's cost-effective conservation and energy-efficiency programs duringthe previous year.
F. The Commission shall grant recovery, on an annual basis, of aperformance-based incentive for delivering conservation and energy efficiencybenefits, which shall be included in the utility's respective purchased gasadjustment mechanism. The incentive shall be calculated as a reasonable shareof the verified net economic benefits created by the utility's cost-effectiveconservation and energy efficiency programs, and may be recovered over aperiod of years equal to the payback period or discounted to net presentvalue and recovered in the first year. In structuring this incentive, theCommission shall create a reasonable opportunity for a utility to earn up toa 15 percent share of such independently verified net economic benefits uponmeeting target levels of such benefits set forth in a plan approved by theCommission. The level of net economic benefits to be used as the basis forsuch calculation shall be the sum of customer savings less utility costsrecovered through subsection D, measured over the number of years of thepayback period, rounded up to the next highest year. The incentivesauthorized by this subsection shall be in addition to any other revenuerequirements or rates established pursuant to § 56-235.2 or 56-235.6 andindependent of any computation of shared revenues under an approvedperformance-based regulation plan.
G. Unless the context clearly indicates otherwise, nothing in this chaptershall impair the Commission's authority under § 56-234.2, 56-235.2, or56-235.6; provided, however, that notwithstanding any other provision of law,the Commission shall not reduce an authorized return on common equity orother measure of utility profit as a result of the implementation of anatural gas conservation and ratemaking efficiency plan pursuant to thischapter.
§ 56-602. Conservation and ratemaking efficiency plans.
A. Notwithstanding any provision of law to the contrary, each natural gasutility shall have the option to file a conservation and ratemakingefficiency plan as provided in this chapter. Such a plan may include one ormore residential, small commercial, or small general service classes, butshall not apply to large commercial or large industrial classes of customers.Such plan shall include: (i) a normalization component that removes theeffect of weather from the determination of conservation and energyefficiency results; (ii) a decoupling mechanism; (iii) one or morecost-effective conservation and energy efficiency programs; (iv) provisionsto address the needs of low-income or low-usage residential customers; and(v) provisions to ensure that the rates and service to non-participatingclasses of customers are not adversely impacted. Such plan may also includeprovisions for phased or targeted implementation of rate or tariff designchanges, if any, or conservation and energy efficiency programs. TheCommission may approve such a plan after such notice and opportunity forhearing as the Commission may prescribe, subject to the provisions of thischapter. Nothing in this subsection shall prevent a natural gas utility fromamending a conservation and ratemaking efficiency plan by amending, altering,supplementing, or deleting one or more conservation or energy efficiencyprograms.
B. The Commission shall approve or deny, within 180 days, a natural gasutility's initial application for any revenue-neutral conservation andratemaking efficiency plan that allocates annual per-customer fixed costs onan intra-class basis in reliance upon a revenue study or class cost ofservice study supporting the rates in effect at the time the plan is filed. Aplan filed pursuant to this subsection shall not require the filing of ratecase schedules. The Commission shall approve or deny, within 120 days, anatural gas utility's application to amend a previously approved plan. TheCommission shall approve such a plan or amendment if it finds that the plan'sor amendment's proposed decoupling mechanism is revenue-neutral and isotherwise consistent with this chapter. If the Commission denies such a planor amendment, it shall set forth with specificity the reasons for such denialand the utility shall have the right to refile, without prejudice, an amendedplan or amendment within 60 days, and the Commission shall thereafter have 60days to approve or deny the amended plan or amendment. The time period forCommission review provided for in this subsection shall not apply if theconservation and ratemaking efficiency plan is filed in conjunction with arate case using the cost of service methodology set forth in § 56-235.2 or aperformance-based regulation plan authorized by § 56-235.6.
C. The Commission shall approve or deny, within 270 days, a natural gasutility's initial application for any revenue-neutral conservation andratemaking efficiency plan that allocates per-customer fixed costs on anintra-class basis according to a class cost of service study filed with theplan, when such plan is filed in conjunction with a rate case using the costof service methodology set forth in § 56-235.2 or a performance-basedregulation plan authorized by § 56-235.6. The Commission shall approve ordeny, within 120 days, a natural gas utility's application to amend a planpreviously approved pursuant to this subsection. The Commission shall approvesuch a plan or amendment if it finds that the plan's or amendment's proposeddecoupling mechanism is revenue-neutral, is consistent with this chapter, andis otherwise in the public interest, including any findings required by §56-235.2 or 56-235.6. If the Commission denies such a plan or amendment, itshall set forth with specificity the reasons for its denial and the utilityshall have the right to refile, without prejudice, an amended plan oramendment within 60 days; the Commission shall thereafter have 60 days toapprove or deny the amended plan or amendment.
D. The Commission shall allow any natural gas utility that implements aconservation and ratemaking efficiency plan under this chapter to recover, ona timely basis and through its regulated rates charged to its classes ofcustomers participating in the plan, its entire incremental costs associatedwith cost-effective conservation and energy efficiency programs that aredesigned to encourage the reduction of annualized, weather-normalized naturalgas consumption per customer. Ratemaking treatment may include placingappropriate capital expenditures for technology and program costs in therespective utility's rate base, deferral of such interim incremental costs(which costs would not be subject to an earnings test), or recovering theutility's technology and program costs through another ratemaking methodologyapproved by the Commission, such as a tracking mechanism. Such conservationand energy efficiency programs may also be jointly conducted or co-sponsoredwith other utilities, federal, state or local government agencies, nonprofitorganizations, trade associations, homebuilders, and other for-profitvendors. Incremental costs recovered pursuant to this subsection shall be inaddition to all other costs that the utility is permitted to recover, shallnot be considered an offset to other Commission-approved costs of service orrevenue requirements, and shall not be included in any computation relativeto a performance-based regulation plan revenue sharing mechanism.
E. The Commission shall require every natural gas utility operating under aconservation and ratemaking efficiency plan approved pursuant to this chapterto file annual reports showing the year over year weather-normalized use ofnatural gas on an average customer basis, by customer class, as well as theincremental, independently verified net economic benefits created by theutility's cost-effective conservation and energy-efficiency programs duringthe previous year.
F. The Commission shall grant recovery, on an annual basis, of aperformance-based incentive for delivering conservation and energy efficiencybenefits, which shall be included in the utility's respective purchased gasadjustment mechanism. The incentive shall be calculated as a reasonable shareof the verified net economic benefits created by the utility's cost-effectiveconservation and energy efficiency programs, and may be recovered over aperiod of years equal to the payback period or discounted to net presentvalue and recovered in the first year. In structuring this incentive, theCommission shall create a reasonable opportunity for a utility to earn up toa 15 percent share of such independently verified net economic benefits uponmeeting target levels of such benefits set forth in a plan approved by theCommission. The level of net economic benefits to be used as the basis forsuch calculation shall be the sum of customer savings less utility costsrecovered through subsection D, measured over the number of years of thepayback period, rounded up to the next highest year. The incentivesauthorized by this subsection shall be in addition to any other revenuerequirements or rates established pursuant to § 56-235.2 or 56-235.6 andindependent of any computation of shared revenues under an approvedperformance-based regulation plan.
G. Unless the context clearly indicates otherwise, nothing in this chaptershall impair the Commission's authority under § 56-234.2, 56-235.2, or56-235.6; provided, however, that notwithstanding any other provision of law,the Commission shall not reduce an authorized return on common equity orother measure of utility profit as a result of the implementation of anatural gas conservation and ratemaking efficiency plan pursuant to thischapter.
§ 56-602. Conservation and ratemaking efficiency plans.
A. Notwithstanding any provision of law to the contrary, each natural gasutility shall have the option to file a conservation and ratemakingefficiency plan as provided in this chapter. Such a plan may include one ormore residential, small commercial, or small general service classes, butshall not apply to large commercial or large industrial classes of customers.Such plan shall include: (i) a normalization component that removes theeffect of weather from the determination of conservation and energyefficiency results; (ii) a decoupling mechanism; (iii) one or morecost-effective conservation and energy efficiency programs; (iv) provisionsto address the needs of low-income or low-usage residential customers; and(v) provisions to ensure that the rates and service to non-participatingclasses of customers are not adversely impacted. Such plan may also includeprovisions for phased or targeted implementation of rate or tariff designchanges, if any, or conservation and energy efficiency programs. TheCommission may approve such a plan after such notice and opportunity forhearing as the Commission may prescribe, subject to the provisions of thischapter. Nothing in this subsection shall prevent a natural gas utility fromamending a conservation and ratemaking efficiency plan by amending, altering,supplementing, or deleting one or more conservation or energy efficiencyprograms.
B. The Commission shall approve or deny, within 180 days, a natural gasutility's initial application for any revenue-neutral conservation andratemaking efficiency plan that allocates annual per-customer fixed costs onan intra-class basis in reliance upon a revenue study or class cost ofservice study supporting the rates in effect at the time the plan is filed. Aplan filed pursuant to this subsection shall not require the filing of ratecase schedules. The Commission shall approve or deny, within 120 days, anatural gas utility's application to amend a previously approved plan. TheCommission shall approve such a plan or amendment if it finds that the plan'sor amendment's proposed decoupling mechanism is revenue-neutral and isotherwise consistent with this chapter. If the Commission denies such a planor amendment, it shall set forth with specificity the reasons for such denialand the utility shall have the right to refile, without prejudice, an amendedplan or amendment within 60 days, and the Commission shall thereafter have 60days to approve or deny the amended plan or amendment. The time period forCommission review provided for in this subsection shall not apply if theconservation and ratemaking efficiency plan is filed in conjunction with arate case using the cost of service methodology set forth in § 56-235.2 or aperformance-based regulation plan authorized by § 56-235.6.
C. The Commission shall approve or deny, within 270 days, a natural gasutility's initial application for any revenue-neutral conservation andratemaking efficiency plan that allocates per-customer fixed costs on anintra-class basis according to a class cost of service study filed with theplan, when such plan is filed in conjunction with a rate case using the costof service methodology set forth in § 56-235.2 or a performance-basedregulation plan authorized by § 56-235.6. The Commission shall approve ordeny, within 120 days, a natural gas utility's application to amend a planpreviously approved pursuant to this subsection. The Commission shall approvesuch a plan or amendment if it finds that the plan's or amendment's proposeddecoupling mechanism is revenue-neutral, is consistent with this chapter, andis otherwise in the public interest, including any findings required by §56-235.2 or 56-235.6. If the Commission denies such a plan or amendment, itshall set forth with specificity the reasons for its denial and the utilityshall have the right to refile, without prejudice, an amended plan oramendment within 60 days; the Commission shall thereafter have 60 days toapprove or deny the amended plan or amendment.
D. The Commission shall allow any natural gas utility that implements aconservation and ratemaking efficiency plan under this chapter to recover, ona timely basis and through its regulated rates charged to its classes ofcustomers participating in the plan, its entire incremental costs associatedwith cost-effective conservation and energy efficiency programs that aredesigned to encourage the reduction of annualized, weather-normalized naturalgas consumption per customer. Ratemaking treatment may include placingappropriate capital expenditures for technology and program costs in therespective utility's rate base, deferral of such interim incremental costs(which costs would not be subject to an earnings test), or recovering theutility's technology and program costs through another ratemaking methodologyapproved by the Commission, such as a tracking mechanism. Such conservationand energy efficiency programs may also be jointly conducted or co-sponsoredwith other utilities, federal, state or local government agencies, nonprofitorganizations, trade associations, homebuilders, and other for-profitvendors. Incremental costs recovered pursuant to this subsection shall be inaddition to all other costs that the utility is permitted to recover, shallnot be considered an offset to other Commission-approved costs of service orrevenue requirements, and shall not be included in any computation relativeto a performance-based regulation plan revenue sharing mechanism.
E. The Commission shall require every natural gas utility operating under aconservation and ratemaking efficiency plan approved pursuant to this chapterto file annual reports showing the year over year weather-normalized use ofnatural gas on an average customer basis, by customer class, as well as theincremental, independently verified net economic benefits created by theutility's cost-effective conservation and energy-efficiency programs duringthe previous year.
F. The Commission shall grant recovery, on an annual basis, of aperformance-based incentive for delivering conservation and energy efficiencybenefits, which shall be included in the utility's respective purchased gasadjustment mechanism. The incentive shall be calculated as a reasonable shareof the verified net economic benefits created by the utility's cost-effectiveconservation and energy efficiency programs, and may be recovered over aperiod of years equal to the payback period or discounted to net presentvalue and recovered in the first year. In structuring this incentive, theCommission shall create a reasonable opportunity for a utility to earn up toa 15 percent share of such independently verified net economic benefits uponmeeting target levels of such benefits set forth in a plan approved by theCommission. The level of net economic benefits to be used as the basis forsuch calculation shall be the sum of customer savings less utility costsrecovered through subsection D, measured over the number of years of thepayback period, rounded up to the next highest year. The incentivesauthorized by this subsection shall be in addition to any other revenuerequirements or rates established pursuant to § 56-235.2 or 56-235.6 andindependent of any computation of shared revenues under an approvedperformance-based regulation plan.
G. Unless the context clearly indicates otherwise, nothing in this chaptershall impair the Commission's authority under § 56-234.2, 56-235.2, or56-235.6; provided, however, that notwithstanding any other provision of law,the Commission shall not reduce an authorized return on common equity orother measure of utility profit as a result of the implementation of anatural gas conservation and ratemaking efficiency plan pursuant to thischapter.
