Public Act 098-0057
 
SB2266 EnrolledLRB098 10244 MGM 40404 b

    AN ACT concerning regulation.
 
    Be it enacted by the People of the State of Illinois,
represented in the General Assembly:
 
    Section 5. The Public Utilities Act is amended by adding
Sections 5-111 and 9-220.3 as follows:
 
    (220 ILCS 5/5-111 new)
    Sec. 5-111. Natural gas performance reporting.
    (a) The General Assembly recognizes that for well over a
century Illinois residents and businesses have relied on the
natural gas utility system. The General Assembly finds that in
order for a natural gas utility to provide safe, reliable, and
affordable service to the State's current and future utility
customers, a utility must refurbish, rebuild, modernize, and
expand its infrastructure and adequately train its workforce on
appropriate operations procedures and policies designed to
effectively maintain its infrastructure.
    (b) A natural gas public utility shall report annually to
the Commission the following information, compiled on a
calendar-year basis, beginning with the first report on April
1, 2014:
        (1) the number of emergency calls with response times
    exceeding both 30 minutes and 60 minutes and the number of
    emergency calls in which the utility stopped the flow of
    natural gas on the system or appropriately vented natural
    gas in a time exceeding both 60 minutes and 90 minutes;
        (2) the number of incidents of damage per thousand gas
    facility locate requests to the utility's pipeline
    facilities resulting from utility error and the number of
    incidents of damage per thousand gas facility locate
    requests to the utility's pipeline facilities resulting
    from the fault of third parties;
        (3) the number of scheduled cathodic protection
    readings below -0.850 volts;
        (4) the number of service lines that were inactive for
    over 3 years and not disconnected from a source of supply;
        (5) the number of difficult to locate services
    replaced;
        (6) the number of remotely-readable cathodic
    protection devices;
        (7) the miles of main and numbers of services replaced
    that were constructed of cast iron, wrought iron, ductile
    iron, unprotected coated steel, unprotected bare steel,
    mechanically coupled steel, copper, Cellulose Acetate
    Butyrate (CAB) plastic, pre-1973 DuPont Aldyl "A"
    polyethylene, PVC, or other types of materials identified
    by a State or federal governmental agency as being prone to
    leakage;
        (8) the number of miles of transmission facilities on
    which maximum allowable operating pressures have been
    established;
        (9) the number of miles of transmission facilities
    equipped with remotely controlled shut-off valve
    capability; and
        (10) the value in dollars of contracts in force with
    minority-owned, female-owned, and qualified
    service-disabled veteran-owned businesses.
    (c) Reports required under this Section shall be submitted
to the Commission by April 1 of each year. Reports shall be
verified in the same manner as Form 21 ILCC and contain the
information specified in subsection (b) of this Section for the
preceding calendar year. The reports shall further identify the
number of jobs attributable to each of the reporting
requirements in (b)(1) through (b)(10) of this Section.
Following the submission of a utility's initial report,
subsequent reports by the utility shall state year-over-year
changes in the information being reported. The Commission shall
post the reports on the public portion of its web site.
    (d) A natural gas utility shall submit an annual plan
specifying its goals for each of the items identified in
subsection (b) of this Section, and such utility is expected to
show reasonable and continuing progress in improving its
performance under the criteria identified in subsection (b) of
this Section. If the Commission finds, after notice and
hearing, that a utility has failed to show progressive
improvement in its performance under those criteria, the
Commission may require the natural gas utility to submit a
remediation plan for the criteria identified in subsection (b)
of this Section designed to improve the utility's performance.
    (e) The Commission may adopt rules to implement the
requirements of this Section.
    (f) This Section does not apply to a gas utility that on
January 1, 2013 provided gas service to fewer than 100,000
customers in Illinois.
 
    (220 ILCS 5/9-220.3 new)
    Sec. 9-220.3. Natural gas surcharges authorized.
    (a) Tariff.
        (1) Pursuant to Section 9-201 of this Act, a natural
    gas utility serving more than 700,000 customers may file a
    tariff for a surcharge which adjusts rates and charges to
    provide for recovery of costs associated with investments
    in qualifying infrastructure plant, independent of any
    other matters related to the utility's revenue
    requirement.
        (2) Within 30 days after the effective date of this
    amendatory Act of the 98th General Assembly, the Commission
    shall adopt emergency rules to implement the provisions of
    this amendatory Act of the 98th General Assembly. The
    utility may file with the Commission tariffs implementing
    the provisions of this amendatory Act of the 98th General
    Assembly after the effective date of the emergency rules
    authorized by subsection (i).
        (3) The Commission shall issue an order approving, or
    approving with modification to ensure compliance with this
    Section, the tariff no later than 120 days after such
    filing of the tariffs filed pursuant to this Section. The
    utility shall have 7 days following the date of service of
    the order to notify the Commission in writing whether it
    will accept any modifications so identified in the order or
    whether it has elected not to proceed with the tariff. If
    the order includes no modifications or if the utility
    notifies the Commission that it will accept such
    modifications, the tariff shall take effect on the first
    day of the calendar year in which the Commission issues the
    order, subject to petitions for rehearing and appellate
    procedures. After the tariff takes effect, the utility may,
    upon 10 days' notice to the Commission, file to withdraw
    the tariff at any time, and the Commission shall approve
    such filing without suspension or hearing, subject to a
    final reconciliation as provided in subsection (e) of this
    Section.
        (4) When a natural gas utility withdraws the surcharge
    tariff, the utility shall not recover any additional
    charges through the surcharge approved pursuant to this
    Section, subject to the resolution of the final
    reconciliation pursuant to subsection (e) of this Section.
    The utility's qualifying infrastructure investment net of
    accumulated depreciation may be transferred to the natural
    gas utility's rate base in the utility's next general rate
    case. The utility's delivery base rates in effect upon
    withdrawal of the surcharge tariff shall not be adjusted at
    the time the surcharge tariff is withdrawn.
        (5) A natural gas utility that is subject to its
    delivery base rates being fixed at their current rates
    pursuant to a Commission order entered in Docket No.
    11-0046, notwithstanding the effective date of its tariff
    authorized pursuant to this Section, shall reflect in a
    tariff surcharge only those projects placed in service
    after the fixed rate period of the merger agreement has
    expired by its terms.
    (b) For purposes of this Section, "qualifying
infrastructure plant" includes only plant additions placed in
service not reflected in the rate base used to establish the
utility's delivery base rates. "Costs associated with
investments in qualifying infrastructure plant" shall include
a return on qualifying infrastructure plant and recovery of
depreciation and amortization expense on qualifying
infrastructure plant, net of the depreciation included in the
utility's base rates on any plant retired in conjunction with
the installation of the qualifying infrastructure plant.
Collectively the "qualifying infrastructure plant" and "costs
associated with investments in qualifying infrastructure
plant" are referred to as the "qualifying infrastructure
investment" and that are related to one or more of the
following:
        (1) the installation of facilities to retire and
    replace underground natural gas facilities, including
    facilities appurtenant to facilities constructed of those
    materials such as meters, regulators, and services, and
    that are constructed of cast iron, wrought iron, ductile
    iron, unprotected coated steel, unprotected bare steel,
    mechanically coupled steel, copper, Cellulose Acetate
    Butyrate (CAB) plastic, pre-1973 DuPont Aldyl "A"
    polyethylene, PVC, or other types of materials identified
    by a State or federal governmental agency as being prone to
    leakage;
        (2) the relocation of meters from inside customers'
    facilities to outside;
        (3) the upgrading of the gas distribution system from a
    low pressure to a medium pressure system, including
    installation of high-pressure facilities to support the
    upgrade;
        (4) modernization investments by a combination
    utility, as defined in subsection (b) of Section 16-108.5
    of this Act, to install:
            (A) advanced gas meters in connection with the
        installation of advanced electric meters pursuant to
        Sections 16-108.5 and 16-108.6 of this Act; and
            (B) the communications hardware and software and
        associated system software that creates a network
        between advanced gas meters and utility business
        systems and allows the collection and distribution of
        gas-related information to customers and other parties
        in addition to providing information to the utility
        itself;
        (5) replacing high-pressure transmission pipelines and
    associated facilities identified as having a higher risk of
    leakage or failure or installing or replacing
    high-pressure transmission pipelines and associated
    facilities to establish records and maximum allowable
    operating pressures;
        (6) replacing difficult to locate mains and service
    pipes and associated facilities; and
        (7) replacing or installing transmission and
    distribution regulator stations, regulators, valves, and
    associated facilities to establish over-pressure
    protection.
    With respect to the installation of the facilities
identified in paragraph (1) of subsection (b) of this Section,
the natural gas utility shall determine priorities for such
installation with consideration of projects either: (i)
integral to a general government public facilities improvement
program or (ii) ranked in the highest risk categories in the
utility's most recent Distribution Integrity Management Plan
where removal or replacement is the remedial measure.
    (c) Qualifying infrastructure investment, defined in
subsection (b) of this Section, recoverable through a tariff
authorized by subsection (a) of this Section, shall not include
costs or expenses incurred in the ordinary course of business
for the ongoing or routine operations of the utility,
including, but not limited to:
        (1) operating and maintenance costs; and
        (2) costs of facilities that are revenue-producing,
    which means facilities that are constructed or installed
    for the purpose of serving new customers.
    (d) Gas utility commitments. A natural gas utility that has
in effect a natural gas surcharge tariff pursuant to this
Section shall:
        (1) recognize that the General Assembly identifies
    improved public safety and reliability of natural gas
    facilities as the cornerstone upon which this Section is
    designed, and qualifying projects should be encouraged,
    selected, and prioritized based on these factors; and
        (2) provide information to the Commission as requested
    to demonstrate that (i) the projects included in the tariff
    are indeed qualifying projects and (ii) the projects are
    selected and prioritized taking into account improved
    public safety and reliability.
        (3) The amount of qualifying infrastructure investment
    eligible for recovery under the tariff in the applicable
    calendar year is limited to the lesser of (i) the actual
    qualifying infrastructure plant placed in service in the
    applicable calendar year and (ii) the difference by which
    total plant additions in the applicable calendar year
    exceed the baseline amount, and subject to the limitation
    in subsection (g) of this Section. A natural gas utility
    can recover the costs of qualifying infrastructure
    investments through an approved surcharge tariff from the
    beginning of each calendar year subject to the
    reconciliation initiated under paragraph (2) of subsection
    (e) of this Section, during which the Commission may make
    adjustments to ensure that the limits defined in this
    paragraph are not exceeded. Further, if total plant
    additions in a calendar year do not exceed the baseline
    amount in the applicable calendar year, the Commission,
    during the reconciliation initiated under paragraph (2) of
    subsection (e) of this Section for the applicable calendar
    year, shall adjust the amount of qualifying infrastructure
    investment eligible for recovery under the tariff to zero.
        (4) For purposes of this Section, "baseline amount"
    means an amount equal to the utility's average of total
    depreciation expense, as reported on page 336, column (b)
    of the utility's ILCC Form 21, for the calendar years 2006
    through 2010.
    (e) Review of investment.
        (1) The amount of qualifying infrastructure investment
    shall be shown on an Information Sheet supplemental to the
    surcharge tariff and filed with the Commission monthly or
    some other time period at the option of the utility. The
    Information Sheet shall be accompanied by data showing the
    calculation of the qualifying infrastructure investment
    adjustment. Unless otherwise ordered by the Commission,
    each qualifying infrastructure investment adjustment shown
    on an Information Sheet shall become effective pursuant to
    the utility's approved tariffs.
        (2) For each calendar year in which a surcharge tariff
    is in effect, the natural gas utility shall file a petition
    with the Commission to initiate hearings to reconcile
    amounts billed under each surcharge authorized pursuant to
    this Section with the actual prudently incurred costs
    recoverable under this tariff in the preceding year. The
    petition filed by the natural gas utility shall include
    testimony and schedules that support the accuracy and the
    prudence of the qualifying infrastructure investment for
    the calendar year being reconciled. The petition filed
    shall also include the number of jobs attributable to the
    natural gas surcharge tariff as required by rule. The
    review of the utility's investment shall include
    identification and review of all plant that was ranked
    within the highest risk categories in that utility's most
    recent Distribution Integrity Management Plan.
    (f) The rate of return applied shall be the overall rate of
return authorized by the Commission in the utility's last gas
rate case.
    (g) The cumulative amount of increases billed under the
surcharge, since the utility's most recent delivery service
rate order, shall not exceed an annual average 4% of the
utility's delivery base rate revenues, but shall not exceed
5.5% in any given year. On the effective date of new delivery
base rates, the surcharge shall be reduced to zero with respect
to qualifying infrastructure investment that is transferred to
the rate base used to establish the utility's delivery base
rates, provided that the utility may continue to charge or
refund any reconciliation adjustment determined pursuant to
subsection (e) of this Section.
    (h) If a gas utility obtains a surcharge tariff under this
Section 9-220.3, then it and its affiliates are excused from
the rate case filing requirements contained in Sections
9-220(h) and 9-220(h-1). In the event a natural gas utility,
prior to the effective date of this amendatory Act of the 98th
General Assembly, made a rate case filing that is still pending
on the effective date of this amendatory Act of the 98th
General Assembly, the natural gas utility may, at the time it
files its surcharge tariff with the Commission, also file a
notice with the Commission to withdraw its rate case filing.
Any affiliate of such natural gas utility may also file to
withdraw its rate case filing. Upon receipt of such notice, the
Commission shall dismiss the rate case filing with prejudice
and such tariffs and the record related thereto shall not be
the subject of any further hearing, investigation, or
proceeding of any kind related to rates for gas delivery
services. Notwithstanding the foregoing, a natural gas utility
shall not be permitted to withdraw a rate case filing for which
a proposed order recommending a rate reduction is pending. A
natural gas utility shall not be permitted to withdraw the gas
delivery services tariffs that are the subject of Commission
Docket Nos. 12-0511/12-0512 (cons.). None of the costs incurred
for the withdrawn rate case are recoverable from ratepayers.
    (i) The Commission shall promulgate rules and regulations
to carry out the provisions of this Section under the emergency
rulemaking provisions set forth in Section 5-45 of the Illinois
Administrative Procedure Act, and such emergency rules shall be
effective no later than 30 days after the effective date of
this amendatory Act of the 98th General Assembly.
    (j) This Section is repealed December 31, 2023.
 
    Section 99. Effective date. This Act takes effect upon
becoming law.