State of Illinois
92nd General Assembly
Legislation

   [ Search ]   [ PDF text ]   [ Legislation ]   
[ Home ]   [ Back ]   [ Bottom ]


[ Introduced ][ Engrossed ][ Enrolled ]
[ House Amendment 001 ][ House Amendment 002 ][ House Amendment 003 ]
[ House Amendment 004 ][ Senate Amendment 001 ]


92_SB2081ham005

 










                                           LRB9212879JSpcam09

 1                    AMENDMENT TO SENATE BILL 2081

 2        AMENDMENT NO.     .  Amend Senate Bill 2081, AS  AMENDED,
 3    by  replacing  everything  after the enacting clause with the
 4    following:

 5        "Section 5.  The  Public  Utilities  Act  is  amended  by
 6    changing  Sections  9-220,  16-102,  and  16-111  and  adding
 7    Section 16-111.3 as follows:

 8        (220 ILCS 5/9-220) (from Ch. 111 2/3, par. 9-220)
 9        Sec. 9-220. Rate changes based on changes in fuel costs.
10        (a)  Notwithstanding the provisions of Section 9-201, the
11    Commission  may  authorize  the increase or decrease of rates
12    and charges based upon changes in the cost of  fuel  used  in
13    the  generation  or  production of electric power, changes in
14    the cost of purchased  power,  or  changes  in  the  cost  of
15    purchased  gas  through  the  application  of fuel adjustment
16    clauses or purchased gas adjustment clauses.  The  Commission
17    may  also  authorize  the  increase  or decrease of rates and
18    charges based upon expenditures or  revenues  resulting  from
19    the purchase or sale of emission allowances created under the
20    federal  Clean  Air Act Amendments of 1990, through such fuel
21    adjustment clauses, as a cost of fuel.  For the  purposes  of
22    this  paragraph,  cost  of  fuel  used  in  the generation or
 
                            -2-            LRB9212879JSpcam09
 1    production of electric power shall include the amount of  any
 2    fees paid by the utility for the implementation and operation
 3    of  a  process  for  the desulfurization of the flue gas when
 4    burning high sulfur coal at any location within the State  of
 5    Illinois irrespective of the attainment status designation of
 6    such  location; but shall not include transportation costs of
 7    coal (i) except to the extent that for contracts entered into
 8    on and after the effective date of  this  amendatory  Act  of
 9    1997,  the  cost of the coal, including transportation costs,
10    constitutes the lowest cost for adequate  and  reliable  fuel
11    supply   reasonably   available  to  the  public  utility  in
12    comparison to the cost, including  transportation  costs,  of
13    other adequate and reliable sources of fuel supply reasonably
14    available  to the public utility, or (ii) except as otherwise
15    provided in the next 3 sentences of  this  paragraph.    Such
16    costs  of  fuel  shall, when requested by a utility or at the
17    conclusion  of  the  utility's  next  general  electric  rate
18    proceeding,   whichever   shall    first    occur,    include
19    transportation  costs  of  coal purchased under existing coal
20    purchase contracts.  For purposes of this paragraph "existing
21    coal purchase contracts" means contracts for the purchase  of
22    coal  in  effect on the effective date of this amendatory Act
23    of 1991, as such contracts may  thereafter  be  amended,  but
24    only  to the extent that any such amendment does not increase
25    the aggregate quantity of coal to  be  purchased  under  such
26    contract.  Nothing herein shall authorize an electric utility
27    to recover through its fuel adjustment clause any amounts  of
28    transportation  costs  of  coal  that  were  included  in the
29    revenue requirement used to set base rates in its most recent
30    general rate proceeding. Cost shall be based  upon  uniformly
31    applied accounting principles. Annually, the Commission shall
32    initiate  public  hearings  to  determine whether the clauses
33    reflect  actual  costs  of  fuel,   gas,   power,   or   coal
34    transportation  purchased to determine whether such purchases
 
                            -3-            LRB9212879JSpcam09
 1    were prudent, and to reconcile any amounts collected with the
 2    actual costs of fuel,  power,  gas,  or  coal  transportation
 3    prudently  purchased.  In each such proceeding, the burden of
 4    proof shall be upon the utility to establish the prudence  of
 5    its   cost  of  fuel,  power,  gas,  or  coal  transportation
 6    purchases and costs. The Commission  shall  issue  its  final
 7    order  in each such annual proceeding for an electric utility
 8    by December 31 of the year immediately following the year  to
 9    which  the proceeding pertains, provided, that the Commission
10    shall issue its final  order  with  respect  to  such  annual
11    proceeding  for  the  years  1996 and earlier by December 31,
12    1998.
13        (b)  A public utility providing electric  service,  other
14    than  a public utility described in subsections (e) or (f) of
15    this Section, may at any time during the mandatory transition
16    period file with the Commission proposed tariff  sheets  that
17    eliminate  the  public  utility's  fuel adjustment clause and
18    adjust the public utility's base rate tariffs by  the  amount
19    necessary  for  the  base fuel component of the base rates to
20    recover the public utility's average fuel  and  power  supply
21    costs per kilowatt-hour for the 2 most recent years for which
22    the  Commission has issued final orders in annual proceedings
23    pursuant to subsection (a), where the average fuel and  power
24    supply costs per kilowatt-hour shall be calculated as the sum
25    of  the public utility's prudent and allowable fuel and power
26    supply costs as found by the Commission in the 2  proceedings
27    divided   by   the  public  utility's  actual  jurisdictional
28    kilowatt-hour sales for those 2 years.   Notwithstanding  any
29    contrary  or inconsistent provisions in Section 9-201 of this
30    Act, in subsection (a) of this Section or  in  any  rules  or
31    regulations   promulgated   by  the  Commission  pursuant  to
32    subsection (g) of this Section, the Commission  shall  review
33    and  shall  by  order  approve,  or  approve as modified, the
34    proposed tariff sheets within 60 days after the date  of  the
 
                            -4-            LRB9212879JSpcam09
 1    public  utility's  filing.   The  Commission  may  modify the
 2    public utility's proposed tariff sheets only  to  the  extent
 3    the  Commission finds necessary to achieve conformance to the
 4    requirements of this subsection  (b).   During  the  5  years
 5    following  the  date  of  the  Commission's order, but in any
 6    event no earlier than January 1, 2007 2005, a public  utility
 7    whose  fuel adjustment clause has been eliminated pursuant to
 8    this  subsection  shall  not  file  proposed  tariff   sheets
 9    seeking,   or   otherwise   petition   the   Commission  for,
10    reinstatement of a fuel adjustment clause.
11        (c)  Notwithstanding   any   contrary   or   inconsistent
12    provisions in Section 9-201 of this Act, in subsection (a) of
13    this Section or in any rules or  regulations  promulgated  by
14    the  Commission pursuant to subsection (g) of this Section, a
15    public utility  providing  electric  service,  other  than  a
16    public  utility  described  in  subsection (e) or (f) of this
17    Section, may at any  time  during  the  mandatory  transition
18    period  file  with the Commission proposed tariff sheets that
19    establish the rate per kilowatt-hour to be  applied  pursuant
20    to the public utility's fuel adjustment clause at the average
21    value  for such rate during the preceding 24 months, provided
22    that such average rate results  in  a  credit  to  customers'
23    bills,  without  making any revisions to the public utility's
24    base  rate  tariffs.   The  proposed  tariff   sheets   shall
25    establish the fuel adjustment rate for a specific time period
26    of  at least 3 years but not more than 5 years, provided that
27    the terms and conditions for any reinstatement earlier than 5
28    years shall be set forth in the proposed  tariff  sheets  and
29    subject  to  modification or approval by the Commission.  The
30    Commission shall  review  and  shall  by  order  approve  the
31    proposed  tariff  sheets if it finds that the requirements of
32    this subsection are met.  The Commission  shall  not  conduct
33    the  annual  hearings  specified  in  the last 3 sentences of
34    subsection (a) of this Section for the utility for the period
 
                            -5-            LRB9212879JSpcam09
 1    that the factor established pursuant to this subsection is in
 2    effect.
 3        (d)  A public utility providing electric  service,  or  a
 4    public  utility  providing  gas  service  may  file  with the
 5    Commission proposed tariff sheets that eliminate  the  public
 6    utility's  fuel or purchased gas adjustment clause and adjust
 7    the  public  utility's  base  rate  tariffs  to  provide  for
 8    recovery of power supply costs or gas supply costs that would
 9    have been recovered through such clause; provided,  that  the
10    provisions of this subsection (d) shall not be available to a
11    public  utility  described  in subsections (e) or (f) of this
12    Section   to   eliminate   its   fuel   adjustment    clause.
13    Notwithstanding  any  contrary  or inconsistent provisions in
14    Section 9-201 of this Act, in subsection (a) of this Section,
15    or in any rules or regulations promulgated by the  Commission
16    pursuant  to  subsection  (g) of this Section, the Commission
17    shall review and  shall  by  order  approve,  or  approve  as
18    modified  in  the  Commission's  order,  the  proposed tariff
19    sheets within 240 days after the date of the public utility's
20    filing.  The  Commission's  order  shall  approve  rates  and
21    charges  that  the  Commission,  based  on information in the
22    public utility's filing or on the record if a hearing is held
23    by the Commission, finds will recover the reasonable, prudent
24    and necessary jurisdictional power supply costs or gas supply
25    costs incurred or to be incurred by the public utility during
26    a 12 month period found by the Commission to  be  appropriate
27    for  these  purposes,  provided,  that  such  period shall be
28    either (i) a 12 month historical period occurring during  the
29    15  months ending on the date of the public utility's filing,
30    or (ii) a 12 month future period  ending  no  later  than  15
31    months  following  the  date  of the public utility's filing.
32    The public utility  shall  include  with  its  tariff  filing
33    information  showing both (1) its actual jurisdictional power
34    supply costs or gas supply costs for a  12  month  historical
 
                            -6-            LRB9212879JSpcam09
 1    period   conforming  to  (i)  above  and  (2)  its  projected
 2    jurisdictional power supply costs or gas supply costs  for  a
 3    future  12  month  period  conforming  to  (ii) above. If the
 4    Commission's  order  requires  modifications  in  the  tariff
 5    sheets filed by the public utility, the public utility  shall
 6    have  7  days  following  the date of the order to notify the
 7    Commission whether the  public  utility  will  implement  the
 8    modified  tariffs  or elect to continue its fuel or purchased
 9    gas adjustment clause in force as though no  order  had  been
10    entered.   The  Commission's  order  shall  provide  for  any
11    reconciliation  of power supply costs or gas supply costs, as
12    the case may be, and associated  revenues  through  the  date
13    that  the  public  utility's fuel or purchased gas adjustment
14    clause is eliminated.  During the 5 years following the  date
15    of  the  Commission's  order,  a public utility whose fuel or
16    purchased gas adjustment clause has been eliminated  pursuant
17    to  this  subsection  shall  not  file proposed tariff sheets
18    seeking,  or   otherwise   petition   the   Commission   for,
19    reinstatement   or  adoption  of  a  fuel  or  purchased  gas
20    adjustment clause. Nothing in this subsection  (d)  shall  be
21    construed as limiting the Commission's authority to eliminate
22    a  public  utility's  fuel adjustment clause or purchased gas
23    adjustment clause in accordance  with  any  other  applicable
24    provisions of this Act.
25        (e)  Notwithstanding   any   contrary   or   inconsistent
26    provisions  in   Section 9-201 of this Act, in subsection (a)
27    of this  Section,  or  in    any  rules  promulgated  by  the
28    Commission  pursuant    to  subsection (g) of this Section, a
29    public utility providing    electric  service  to  more  than
30    1,000,000  customers  in  this  State may, within the first 6
31    months after the  effective date of this  amendatory  Act  of
32    1997,  file  with the  Commission proposed tariff sheets that
33    eliminate, effective  January 1, 1997, the  public  utility's
34    fuel adjustment clause  without adjusting its base rates, and
 
                            -7-            LRB9212879JSpcam09
 1    such  tariff  sheets shall be  effective upon filing.  To the
 2    extent the application of the fuel    adjustment  clause  had
 3    resulted  in net charges to customers after  January 1, 1997,
 4    the utility shall also file a tariff sheet that  provides for
 5    a refund stated on a per kilowatt-hour basis of such  charges
 6    over a period not to exceed 6 months; provided  however, that
 7    such refund shall not include the proportional    amounts  of
 8    taxes  paid  under  the  Use  Tax  Act,  Service Use Tax Act,
 9    Service Occupation Tax Act, and Retailers' Occupation Tax Act
10    on  fuel used in generation.  The Commission shall  issue  an
11    order   within 45 days after the date of the public utility's
12    filing  approving or approving as modified such tariff sheet.
13    If the fuel  adjustment clause is eliminated pursuant to this
14    subsection, the  Commission  shall  not  conduct  the  annual
15    hearings specified in the  last 3 sentences of subsection (a)
16    of  this  Section  for  the    utility  for  any period after
17    December 31, 1996 and prior to any    reinstatement  of  such
18    clause.  A  public  utility whose fuel  adjustment clause has
19    been eliminated pursuant to this subsection  shall not file a
20    proposed tariff sheet seeking, or  otherwise    petition  the
21    Commission  for, reinstatement of the fuel adjustment  clause
22    prior to January 1, 2007 2005.
23        (f)  Notwithstanding   any   contrary   or   inconsistent
24    provisions in Section 9-201 of this Act, in subsection (a) of
25    this Section, or in any rules or regulations  promulgated  by
26    the  Commission pursuant to subsection (g) of this Section, a
27    public  utility  providing  electric  service  to  more  than
28    500,000 customers but fewer than 1,000,000 customers in  this
29    State may, within the first 6 months after the effective date
30    of  this  amendatory  Act  of  1997, file with the Commission
31    proposed tariff sheets that eliminate, effective  January  1,
32    1997,  the public utility's fuel adjustment clause and adjust
33    its base rates by the amount  necessary  for  the  base  fuel
34    component  of  the  base  rates  to recover 91% of the public
 
                            -8-            LRB9212879JSpcam09
 1    utility's average fuel and power supply costs for the 2  most
 2    recent years for which the Commission, as of January 1, 1997,
 3    has  issued  final  orders  in annual proceedings pursuant to
 4    subsection (a), where the average fuel and power supply costs
 5    per kilowatt-hour shall be  calculated  as  the  sum  of  the
 6    public  utility's prudent and allowable fuel and power supply
 7    costs as found by the Commission in the 2 proceedings divided
 8    by the public utility's actual  jurisdictional  kilowatt-hour
 9    sales  for  those  2 years, provided, that such tariff sheets
10    shall  be  effective  upon  filing.   To   the   extent   the
11    application of the fuel adjustment clause had resulted in net
12    charges to customers after January 1, 1997, the utility shall
13    also file a tariff sheet that provides for a refund stated on
14    a  per  kilowatt-hour basis of such charges over a period not
15    to exceed 6 months.  Provided however, that such refund shall
16    not include the proportional amounts of taxes paid under  the
17    Use Tax Act, Service Use Tax Act, Service Occupation Tax Act,
18    and Retailers' Occupation Tax Act on fuel used in generation.
19    The  Commission shall issue an order within 45 days after the
20    date of the public utility's filing approving or approving as
21    modified such tariff sheet.  If the fuel adjustment clause is
22    eliminated pursuant to this subsection, the Commission  shall
23    not  conduct  the  annual  hearings  specified  in the last 3
24    sentences of subsection (a) of this Section for  the  utility
25    for  any  period  after  December  31,  1996 and prior to any
26    reinstatement of such clause.  A public  utility  whose  fuel
27    adjustment  clause  has  been  eliminated  pursuant  to  this
28    subsection shall not file a proposed tariff sheet seeking, or
29    otherwise  petition  the Commission for, reinstatement of the
30    fuel adjustment clause prior to January 1, 2007 2005.
31        (g)  The Commission shall have  authority  to  promulgate
32    rules  and  regulations  to  carry out the provisions of this
33    Section.
34    (Source: P.A. 90-561, eff. 12-16-97.)
 
                            -9-            LRB9212879JSpcam09
 1        (220 ILCS 5/16-102)
 2        Sec. 16-102.  Definitions.   For  the  purposes  of  this
 3    Article  the following terms shall be defined as set forth in
 4    this Section.
 5        "Alternative  retail  electric  supplier"   means   every
 6    person,   cooperative,  corporation,  municipal  corporation,
 7    company, association, joint  stock  company  or  association,
 8    firm,   partnership,   individual,  or  other  entity,  their
 9    lessees,  trustees,  or  receivers  appointed  by  any  court
10    whatsoever, that offers electric power or  energy  for  sale,
11    lease  or in exchange for other value received to one or more
12    retail  customers,  or  that  engages  in  the  delivery   or
13    furnishing  of  electric  power  or  energy  to  such  retail
14    customers,  and shall include, without limitation, resellers,
15    aggregators and power marketers, but shall  not  include  (i)
16    electric  utilities  (or any agent of the electric utility to
17    the extent the electric utility provides tariffed services to
18    retail customers  through  that  agent),  (ii)  any  electric
19    cooperative  or municipal system as defined in Section 17-100
20    to the extent that  the  electric  cooperative  or  municipal
21    system  is  serving retail customers within any area in which
22    it is or would be entitled to provide service under  the  law
23    in  effect  immediately  prior  to the effective date of this
24    amendatory Act of 1997, (iii) a public utility that is  owned
25    and operated by any public institution of higher education of
26    this  State, or a public utility that is owned by such public
27    institution of higher education and operated by  any  of  its
28    lessees  or  operating agents, within any area in which it is
29    or would be entitled to provide  service  under  the  law  in
30    effect  immediately  prior  to  the  effective  date  of this
31    amendatory Act of 1997, (iv) a retail customer to the  extent
32    that customer obtains its electric power and energy from that
33    customer's  own  cogeneration  or self-generation facilities,
34    (v) an entity that owns, operates, sells, or arranges for the
 
                            -10-           LRB9212879JSpcam09
 1    installation   of   a   customer's   own   cogeneration    or
 2    self-generation facilities, but only to the extent the entity
 3    is   engaged   in   owning,  selling  or  arranging  for  the
 4    installation of such facility,  or operating the facility  on
 5    behalf of such customer, provided however that any such third
 6    party  owner or operator of a facility built after January 1,
 7    1999, complies with the labor provisions of Section 16-128(a)
 8    as  though  such  third  party  were  an  alternative  retail
 9    electric supplier, or (vi)  an  industrial  or  manufacturing
10    customer  that  owns  its own distribution facilities, to the
11    extent  that  the  customer  provides   service   from   that
12    distribution  system  to  a third-party contractor located on
13    the customer's premises that is integrally and  predominantly
14    engaged   in   the  customer's  industrial  or  manufacturing
15    process; provided, that if the  industrial  or  manufacturing
16    customer  has  elected  delivery services, the customer shall
17    pay transition charges applicable to the electric  power  and
18    energy  consumed  by  the  third-party contractor unless such
19    charges are otherwise paid by  the  third  party  contractor,
20    which shall be calculated based on the usage of, and the base
21    rates  or  the  contract rates applicable to, the third-party
22    contractor in accordance with Section 16-102.
23        "Base rates" means the rates for those tariffed  services
24    that  the  electric  utility is required to offer pursuant to
25    subsection (a) of Section 16-103 and that were identified  in
26    a  rate  order  for collection of the electric utility's base
27    rate revenue requirement, excluding  (i)  separate  automatic
28    rate  adjustment  riders  then  in  effect,  (ii)  special or
29    negotiated contract rates, (iii)  delivery  services  tariffs
30    filed  pursuant to Section 16-108, (iv) real-time pricing, or
31    (v) tariffs that were in effect prior to October 1, 1996  and
32    that  based  charges  for  services on an index or average of
33    other utilities' charges, but including (vi)  any  subsequent
34    redesign   of  such  rates  for  tariffed  services  that  is
 
                            -11-           LRB9212879JSpcam09
 1    authorized by the Commission after notice and hearing.
 2        "Competitive service" includes (i) any service  that  has
 3    been declared to be competitive pursuant to Section 16-113 of
 4    this  Act,  (ii)  contract service, and (iii) services, other
 5    than  tariffed  services,  that  are  related  to,  but   not
 6    necessary  for, the provision of electric power and energy or
 7    delivery services.
 8        "Contract service"  means  (1)  services,  including  the
 9    provision  of  electric  power  and energy or other services,
10    that are provided by mutual  agreement  between  an  electric
11    utility and a retail customer that is located in the electric
12    utility's  service  area,  provided  that,  delivery services
13    shall not be a  contract  service  until  such  services  are
14    declared  competitive  pursuant  to  Section 16-113; and also
15    means (2) the provision of electric power and  energy  by  an
16    electric  utility  to  retail  customers outside the electric
17    utility's service area pursuant to Section 16-116.  Provided,
18    however, contract service does not include  electric  utility
19    services  provided  pursuant  to  (i)  contracts  that retail
20    customers are required to execute as a condition of receiving
21    tariffed  services,  or  (ii)  special  or  negotiated   rate
22    contracts  for  electric  utility  services that were entered
23    into between an electric utility and a retail customer  prior
24    to  the  effective  date  of  this amendatory Act of 1997 and
25    filed with the Commission.
26        "Delivery services" means those services provided by  the
27    electric   utility  that  are  necessary  in  order  for  the
28    transmission and distribution systems  to  function  so  that
29    retail  customers  located  in the electric utility's service
30    area can receive electric power  and  energy  from  suppliers
31    other  than  the electric utility, and shall include, without
32    limitation, standard metering and billing services.
33        "Electric utility" means a public utility, as defined  in
34    Section  3-105  of  this  Act, that has a franchise, license,
 
                            -12-           LRB9212879JSpcam09
 1    permit or right to furnish  or  sell  electricity  to  retail
 2    customers within a service area.
 3        "Mandatory  transition  period" means the period from the
 4    effective date of this amendatory Act of 1997 through January
 5    1, 2007 2005.
 6        "Municipal system" shall have the meaning  set  forth  in
 7    Section 17-100.
 8        "Real-time  pricing" means charges for delivered electric
 9    power and energy that  vary  on  an  hour-to-hour  basis  for
10    nonresidential  retail  customers and that vary on a periodic
11    basis during the day for residential retail customers.
12        "Retail customer" means a single  entity  using  electric
13    power  or energy at a single premises and that (A) either (i)
14    is receiving or is eligible to receive tariffed services from
15    an electric utility,  or (ii) that is served by  a  municipal
16    system  or  electric cooperative within any area in which the
17    municipal system or  electric  cooperative  is  or  would  be
18    entitled   to   provide  service  under  the  law  in  effect
19    immediately prior to the effective date  of  this  amendatory
20    Act  of 1997, or (B) an entity which on the effective date of
21    this Act was receiving electric service from a public utility
22    and  (i)  was  engaged  in  the   practice  of   resale   and
23    redistribution of such electricity within a building prior to
24    January  2,  1957, or (ii) was providing lighting services to
25    tenants in a multi-occupancy building, but only to the extent
26    such resale, redistribution or lighting service is authorized
27    by the electric utility's tariffs that were on file with  the
28    Commission on the effective date of this Act.
29        "Service area" means (i) the geographic area within which
30    an electric utility was lawfully entitled to provide electric
31    power and energy to retail customers as of the effective date
32    of  this  amendatory  Act  of  1997,  and  includes  (ii) the
33    location of any retail customer to which the electric utility
34    was lawfully providing  electric  utility  services  on  such
 
                            -13-           LRB9212879JSpcam09
 1    effective date.
 2        "Small    commercial   retail   customer"   means   those
 3    nonresidential  retail  customers  of  an  electric   utility
 4    consuming   15,000  kilowatt-hours  or  less  of  electricity
 5    annually in its service area.
 6        "Tariffed service"  means  services  provided  to  retail
 7    customers  by  an electric utility as defined by its rates on
 8    file with  the  Commission  pursuant  to  the  provisions  of
 9    Article  IX  of  this  Act, but shall not include competitive
10    services.
11        "Transition charge" means a charge expressed in cents per
12    kilowatt-hour that is calculated for a customer or  class  of
13    customers  as  follows  for  each  year  in which an electric
14    utility is entitled to recover transition charges as provided
15    in Section 16-108:
16             (1)  the amount of revenue that an electric  utility
17        would receive from the retail customer or customers if it
18        were  serving  such  customers' electric power and energy
19        requirements as a tariffed service based on  (A)  all  of
20        the  customers' actual usage during the 3 years ending 90
21        days prior to the date on which such customers were first
22        eligible  for  delivery  services  pursuant  to   Section
23        16-104,  and  (B)  on  (i)  the  base  rates in effect on
24        October 1, 1996 (adjusted for the reductions required  by
25        subsection  (b)  of  Section  16-111,  for  any reduction
26        resulting from a rate decrease under  Section  16-101(b),
27        for  any  restatement  of  base rates made in conjunction
28        with  an  elimination  of  the  fuel  adjustment   clause
29        pursuant  to subsection (b), (d), or (f) of Section 9-220
30        and for any removal of decommissioning  costs  from  base
31        rates  pursuant  to  Section  16-114)  and  any  separate
32        automatic   rate   adjustment   riders   (other   than  a
33        decommissioning rate as defined in Section 16-114)  under
34        which  the  customers  were  receiving  or, had they been
 
                            -14-           LRB9212879JSpcam09
 1        customers, would have received electric power and  energy
 2        from  the  electric  utility  during the year immediately
 3        preceding the date on which  such  customers  were  first
 4        eligible for delivery service pursuant to Section 16-104,
 5        or  (ii)  to  the  extent applicable, any contract rates,
 6        including  contracts  or  rates   for   consolidated   or
 7        aggregated  billing,  under  which  such  customers  were
 8        receiving  electric  power  and  energy from the electric
 9        utility during such year;
10             (2)  less the amount of revenue, other than  revenue
11        from  transition  charges and decommissioning rates, that
12        the electric  utility  would  receive  from  such  retail
13        customers  for delivery services provided by the electric
14        utility, assuming such  customers  were  taking  delivery
15        services  for  all  of their usage, based on the delivery
16        services tariffs in effect during the year for which  the
17        transition  charge  is  being calculated and on the usage
18        identified in paragraph (1);
19             (3)  less the market value for  the  electric  power
20        and  energy  that the electric utility would have used to
21        supply all of such customers' electric power  and  energy
22        requirements,  as  a tariffed service, based on the usage
23        identified in  paragraph  (1),  with  such  market  value
24        determined in accordance with Section 16-112 of this Act;
25             (4)  less  the following amount which represents the
26        amount to be attributed to new revenue sources  and  cost
27        reductions by the electric utility through the end of the
28        period  for which transition costs are recovered pursuant
29        to Section 16-108, referred to in this Article XVI  as  a
30        "mitigation factor":
31                  (A)  for  nonresidential  retail  customers, an
32             amount equal to the greater of  (i)  0.5  cents  per
33             kilowatt-hour  during  the  period  October  1, 1999
34             through   December   31,   2004,   0.6   cents   per
 
                            -15-           LRB9212879JSpcam09
 1             kilowatt-hour in calendar year 2005, and  0.9  cents
 2             per  kilowatt-hour in calendar year 2006, multiplied
 3             in each year by the usage  identified  in  paragraph
 4             (1),  or  (ii)  an  amount  equal  to  the following
 5             percentages of the amount produced by  applying  the
 6             applicable  base  rates  (adjusted  as  described in
 7             subparagraph (1)(B)) or contract rate to  the  usage
 8             identified  in  paragraph  (1):  8%  for  the period
 9             October 1, 1999 through December 31,  2002,  10%  in
10             calendar  years  2003 and 2004, 11% in calendar year
11             2005 and 12% in calendar year 2006; and
12                  (B)  for  residential  retail   customers,   an
13             amount  equal  to  the  following percentages of the
14             amount produced by applying the base rates in effect
15             on  October  1,  1996  (adjusted  as  described   in
16             subparagraph  (1)(B))  to  the  usage  identified in
17             paragraph (1): (i)  6%  from  May  1,  2002  through
18             December  31,  2002,  (ii) 7% in calendar years 2003
19             and 2004, (iii) 8% in calendar year 2005,  and  (iv)
20             10% in calendar year 2006;
21             (5)  divided   by   the   usage  of  such  customers
22        identified in paragraph (1),
23    provided that the transition charge shall never be less  than
24    zero.
25        "Unbundled service" means a component or constituent part
26    of a tariffed service which the electric utility subsequently
27    offers separately to its customers.
28    (Source: P.A. 90-561, eff. 12-16-97; 91-50, eff. 6-30-99.)

29        (220 ILCS 5/16-111)
30        Sec.  16-111. Rates and restructuring transactions during
31    mandatory transition period.
32        (a)  During    the    mandatory    transition     period,
33    notwithstanding  any provision of Article IX of this Act, and
 
                            -16-           LRB9212879JSpcam09
 1    except as provided in subsections (b), (d), (e), and  (f)  of
 2    this   Section,   the  Commission  shall  not  (i)  initiate,
 3    authorize or order any change by way of increase (other  than
 4    in  connection  with  a  request  for rate increase which was
 5    filed after September 1, 1997 but prior to October 15,  1997,
 6    by  an electric utility serving less than 12,500 customers in
 7    this State),  (ii)  initiate  or,  unless  requested  by  the
 8    electric  utility,  authorize  or  order any change by way of
 9    decrease, restructuring or unbundling (except as provided  in
10    Section  16-109A),  in the rates of any electric utility that
11    were in effect on October 1, 1996,  or  (iii)  in  any  order
12    approving  any  application  for a merger pursuant to Section
13    7-204 that was  pending  as  of  May  16,  1997,  impose  any
14    condition  requiring any filing for an increase, decrease, or
15    change in, or other review of, an electric utility's rates or
16    enforce any such  condition  of  any  such  order;  provided,
17    however,   that   this  subsection  shall  not  prohibit  the
18    Commission from:
19             (1)  approving  the  application  of   an   electric
20        utility  to  implement  an  alternative to rate of return
21        regulation or a  regulatory  mechanism  that  rewards  or
22        penalizes  the  electric  utility  through  adjustment of
23        rates based on utility performance, pursuant  to  Section
24        9-244;
25             (2)  authorizing  an  electric  utility to eliminate
26        its fuel adjustment  clause  and  adjust  its  base  rate
27        tariffs in accordance with subsection (b), (d), or (f) of
28        Section  9-220  of  this  Act, to fix its fuel adjustment
29        factor in accordance with subsection (c) of Section 9-220
30        of this Act, or to eliminate its fuel  adjustment  clause
31        in  accordance  with  subsection  (e) of Section 9-220 of
32        this Act;
33             (3)  ordering  into  effect  tariffs  for   delivery
34        services   and  transition  charges  in  accordance  with
 
                            -17-           LRB9212879JSpcam09
 1        Sections 16-104 and  16-108,  for  real-time  pricing  in
 2        accordance  with  Section 16-107, or the options required
 3        by Section 16-110 and subsection  (n) of 16-112, allowing
 4        a billing experiment in accordance with  Section  16-106,
 5        or modifying delivery services tariffs in accordance with
 6        Section 16-109; or
 7             (4)  ordering  or allowing into effect any tariff to
 8        recover charges pursuant to  Sections  9-201.5,  9-220.1,
 9        9-221,  9-222  (except  as  provided in Section 9-222.1),
10        16-108, and 16-114  of  this  Act,  Section  5-5  of  the
11        Electricity  Infrastructure  Maintenance Fee Law, Section
12        6-5 of the Renewable Energy, Energy Efficiency, and  Coal
13        Resources  Development Law of 1997, and Section 13 of the
14        Energy Assistance Act of 1989.
15        After  December  31,  2004,  the   provisions   of   this
16    subsection  (a)  shall not apply to an electric utility whose
17    average residential retail rate was less than or equal to 90%
18    of the average  residential  retail  rate  for  the  "Midwest
19    Utilities", as that term is defined in subsection (b) of this
20    Section,  based  on  data  reported  on Form 1 to the Federal
21    Energy Regulatory Commission  for  calendar  year  1995,  and
22    which  served between 150,000 and 250,000 retail customers in
23    this State on January 1, 1995 unless the electric utility  or
24    its  holding  company  has been acquired by or merged with an
25    affiliate of another electric utility subsequent  to  January
26    1,  2002.  This exemption shall be limited to this subsection
27    (a) and shall not extend to any other provisions of this Act.
28        (b)  Notwithstanding the provisions  of  subsection  (a),
29    each  Illinois  electric  utility  serving  more  than 12,500
30    customers  in  Illinois  shall  file  tariffs  (i)  reducing,
31    effective August 1, 1998, each component of its base rates to
32    residential retail customers by 15% from the  base  rates  in
33    effect  immediately  prior to January 1, 1998 and (ii) if the
34    public utility provides electric service  to  (A)  more  than
 
                            -18-           LRB9212879JSpcam09
 1    500,000  customers  but less than 1,000,000 customers in this
 2    State on January 1, 1999, reducing, effective  May  1,  2002,
 3    each  component  of  its  base  rates  to  residential retail
 4    customers by an additional 5% from the base rates  in  effect
 5    immediately  prior  to  January  1,  1998,  or  (B)  at least
 6    1,000,000  customers  in  this  State  on  January  1,  1999,
 7    reducing, effective October 1, 2001, each  component  of  its
 8    base  rates  to residential retail customers by an additional
 9    5% from the base rates in effect immediately prior to January
10    1, 1998. Provided, however, that (A) if an electric utility's
11    average residential retail rate is less than or equal to  the
12    average  residential  retail  rate  for  a  group  of Midwest
13    Utilities  (consisting   of   all   investor-owned   electric
14    utilities   with  annual  system  peaks  in  excess  of  1000
15    megawatts in the States of Illinois, Indiana, Iowa, Kentucky,
16    Michigan, Missouri,  Ohio,  and  Wisconsin),  based  on  data
17    reported   on   Form  1  to  the  Federal  Energy  Regulatory
18    Commission for calendar year 1995,  then  it  shall  only  be
19    required  to  file  tariffs (i) reducing, effective August 1,
20    1998, each component of its base rates to residential  retail
21    customers  by  5%  from  the base rates in effect immediately
22    prior to January 1, 1998, (ii) reducing, effective October 1,
23    2000, each component of its base rates to residential  retail
24    customers  by  the  lesser  of 5% of the base rates in effect
25    immediately prior to January 1, 1998  or  the  percentage  by
26    which  the electric utility's average residential retail rate
27    exceeds the average residential retail rate  of  the  Midwest
28    Utilities,  based  on  data reported on Form 1 to the Federal
29    Energy Regulatory Commission  for  calendar  year  1999,  and
30    (iii)  reducing, effective October 1, 2002, each component of
31    its  base  rates  to  residential  retail  customers  by   an
32    additional amount equal to the lesser of 5% of the base rates
33    in  effect  immediately  prior  to  January  1,  1998  or the
34    percentage  by   which   the   electric   utility's   average
 
                            -19-           LRB9212879JSpcam09
 1    residential  retail  rate  exceeds  the  average  residential
 2    retail  rate of the Midwest Utilities, based on data reported
 3    on Form 1 to the Federal  Energy  Regulatory  Commission  for
 4    calendar year 2001; and (B) if the average residential retail
 5    rate  of  an  electric  utility  serving  between 150,000 and
 6    250,000 retail customers in this State on January 1, 1995  is
 7    less  than  or equal to 90% of the average residential retail
 8    rate for the Midwest Utilities, based  on  data  reported  on
 9    Form  1  to  the  Federal  Energy  Regulatory  Commission for
10    calendar year 1995, then it shall only be  required  to  file
11    tariffs   (i)   reducing,  effective  August  1,  1998,  each
12    component of its base rates to residential  retail  customers
13    by  2%  from  the  base  rates in effect immediately prior to
14    January 1, 1998; (ii) reducing, effective  October  1,  2000,
15    each  component  of  its  base  rates  to  residential retail
16    customers by 2% from the  base  rate  in  effect  immediately
17    prior  to  January  1,  1998;  and  (iii) reducing, effective
18    October  1,  2002,  each  component  of  its  base  rates  to
19    residential retail customers by 1% from  the  base  rates  in
20    effect  immediately  prior  to  January  1,  1998.  Provided,
21    further,  that  any  electric utility for which a decrease in
22    base rates has been or is placed into effect between  October
23    1, 1996 and the dates specified in the preceding sentences of
24    this  subsection,  other than pursuant to the requirements of
25    this subsection, shall be entitled to reduce  the  amount  of
26    any  reduction  or  reductions  in its base rates required by
27    this subsection by the amount of  such  other  decrease.  The
28    tariffs required under this subsection shall be filed 45 days
29    in advance of the effective date. Notwithstanding anything to
30    the  contrary in Section 9-220 of this Act, no restatement of
31    base rates in conjunction with  the  elimination  of  a  fuel
32    adjustment clause under that Section shall result in a lesser
33    decrease in base rates than customers would otherwise receive
34    under   this  subsection  had  the  electric  utility's  fuel
 
                            -20-           LRB9212879JSpcam09
 1    adjustment clause not been eliminated.
 2        (c)  Any utility reducing its base rates by 15% on August
 3    1,  1998  pursuant  to  subsection  (b)  shall  include   the
 4    following  statement  on  its bills for residential customers
 5    from August 1 through December 31, 1998: "Effective August 1,
 6    1998, your rates have been reduced by  15%  by  the  Electric
 7    Service Customer Choice and Rate Relief Law of 1997 passed by
 8    the  Illinois  General  Assembly.".  Any utility reducing its
 9    base rates by 5% on August 1, 1998,  pursuant  to  subsection
10    (b)  shall  include  the following statement on its bills for
11    residential customers from  August  1  through  December  31,
12    1998:   "Effective  August  1,  1998,  your  rates  have been
13    reduced by 5% by the Electric  Service  Customer  Choice  and
14    Rate  Relief  Law  of  1997  passed  by  the Illinois General
15    Assembly.".
16        Any utility reducing its base rates by 2%  on  August  1,
17    1998  pursuant  to subsection (b) shall include the following
18    statement on its bills for residential customers from  August
19    1  through December 31, 1998: "Effective August 1, 1998, your
20    rates have  been  reduced  by  2%  by  the  Electric  Service
21    Customer  Choice  and  Rate  Relief Law of 1997 passed by the
22    Illinois General Assembly.".
23        (d)  During the  mandatory  transition  period,  but  not
24    before  January  1, 2000, and notwithstanding  the provisions
25    of  subsection  (a),  an  electric  utility  may  request  an
26    increase  in  its  base  rates  if   the   electric   utility
27    demonstrates  that  the  2-year average of its earned rate of
28    return  on  common  equity,  calculated  as  its  net  income
29    applicable to common stock divided  by  the  average  of  its
30    beginning  and  ending  balances  of common equity using data
31    reported in the electric  utility's  Form  1  report  to  the
32    Federal  Energy  Regulatory Commission but adjusted to remove
33    the effects of accelerated depreciation  or  amortization  or
34    other  transition  or  mitigation measures implemented by the
 
                            -21-           LRB9212879JSpcam09
 1    electric utility pursuant to subsection (g) of  this  Section
 2    and  the effect of any refund paid pursuant to subsection (e)
 3    of this Section, is below the 2-year average for the  same  2
 4    years of the monthly average yields of 30-year  U.S. Treasury
 5    bonds  published  by  the  Board of Governors of the  Federal
 6    Reserve System in its  weekly  H.15  Statistical  Release  or
 7    successor   publication.  The  Commission  shall  review  the
 8    electric utility's request, and may review the  justness  and
 9    reasonableness   of  all  rates  for  tariffed  services,  in
10    accordance with the provisions of Article  IX  of  this  Act,
11    provided  that  the  Commission shall consider any special or
12    negotiated adjustments to the revenue requirement  agreed  to
13    between  the  electric  utility  and the other parties to the
14    proceeding.   In  setting  rates  under  this  Section,   the
15    Commission  shall  exclude  the  costs  and revenues that are
16    associated with  competitive  services  and  any  billing  or
17    pricing experiments conducted under Section 16-106.
18        (e)  For   the   purposes  of  this  subsection  (e)  all
19    calculations and  comparisons  shall  be  performed  for  the
20    Illinois operations of multijurisdictional utilities.  During
21    the   mandatory   transition   period,   notwithstanding  the
22    provisions of subsection (a), if the  2-year  average  of  an
23    electric  utility's  earned  rate of return on common equity,
24    calculated as its  net  income  applicable  to  common  stock
25    divided  by  the average of its beginning and ending balances
26    of  common  equity  using  data  reported  in  the   electric
27    utility's  Form  1  report  to  the Federal Energy Regulatory
28    Commission but adjusted to remove the effect  of  any  refund
29    paid  under  this  subsection  (e),  and  further adjusted to
30    include the annual amortization of any difference between the
31    consideration received  by  an  affiliated  interest  of  the
32    electric  utility in the sale of an asset which had been sold
33    or transferred by the  electric  utility  to  the  affiliated
34    interest  subsequent to the effective date of this amendatory
 
                            -22-           LRB9212879JSpcam09
 1    Act of 1997 and the consideration for which  such  asset  had
 2    been  sold  or  transferred  to the affiliated interest, with
 3    such difference to be amortized ratably from the date of  the
 4    sale by the affiliated interest to December 31, 2006, exceeds
 5    the  2-year  average of the Index for the same 2 years by 1.5
 6    or more percentage points, the electric  utility  shall  make
 7    refunds to customers beginning the first billing day of April
 8    in  the  following  year in the manner described in paragraph
 9    (3) of this subsection. For purposes of this subsection  (e),
10    the  "Index"  shall  be the sum of (A) the average for the 12
11    months ended September 30 of the monthly  average  yields  of
12    30-year  U.S.  Treasury  bonds  published  by  the  Board  of
13    Governors  of  the  Federal Reserve System in its weekly H.15
14    Statistical Release or successor publication  for  each  year
15    1998  through  2006  2004, and (B) (i) 4.00 percentage points
16    for each of the 12-month periods ending  September  30,  1998
17    through  September  30, 1999 or 8.00 percentage points if the
18    electric utility's average residential retail  rate  is  less
19    than  or  equal to 90% of the average residential retail rate
20    for the "Midwest Utilities",  as  that  term  is  defined  in
21    subsection  (b)  of  this  Section, based on data reported on
22    Form 1  to  the  Federal  Energy  Regulatory  Commission  for
23    calendar  year  1995, and the electric utility served between
24    150,000 and 250,000 retail customers on January 1, 1995, (ii)
25    7.00 percentage points  for  each  of  the  12-month  periods
26    ending  September 30, 2000 through September 30, 2006 2004 if
27    the electric  utility  was  providing  service  to  at  least
28    1,000,000 customers in this State on January 1, 1999, or 9.00
29    percentage   points   if   the   electric  utility's  average
30    residential retail rate is less than or equal to 90%  of  the
31    average  residential retail rate for the "Midwest Utilities",
32    as that term is defined in subsection (b)  of  this  Section,
33    based  on  data  reported  on  Form  1  to the Federal Energy
34    Regulatory Commission for calendar year 1995 and the electric
 
                            -23-           LRB9212879JSpcam09
 1    utility served between 150,000 and 250,000  retail  customers
 2    in  this  State  on  January  1, 1995, (iii) 11.00 percentage
 3    points for each of the 12-month periods ending September  30,
 4    2000  through  September  30,  2006  2004,  but  only  if the
 5    electric utility's average residential retail  rate  is  less
 6    than  or  equal to 90% of the average residential retail rate
 7    for the "Midwest Utilities",  as  that  term  is  defined  in
 8    subsection  (b)  of  this  Section, based on data reported on
 9    Form 1  to  the  Federal  Energy  Regulatory  Commission  for
10    calendar  year  1995,  the  electric  utility  served between
11    150,000 and 250,000 retail customers in this State on January
12    1, 1995, and the electric utility offers delivery services on
13    or before June 1,  2000  to  retail  customers  whose  annual
14    electric  energy use comprises 33% of the kilowatt hour sales
15    to that group of retail customers that are  classified  under
16    Division  D,  Groups 20 through 39 of the Standard Industrial
17    Classifications  set  forth  in   the   Standard   Industrial
18    Classification  Manual  published by the United States Office
19    of Management and Budget, excluding the kilowatt  hour  sales
20    to  those  customers  that are eligible for delivery services
21    pursuant to  Section  16-104(a)(1)(i),  and  offers  delivery
22    services  to  its remaining retail customers classified under
23    Division D, Groups 20 through 39  on  or  before  October  1,
24    2000,  and,  provided  further,  that  the  electric  utility
25    commits  not  to  petition  pursuant to Section 16-108(f) for
26    entry of an order by the Commission authorizing the  electric
27    utility  to  implement  transition  charges for an additional
28    period after December  31,  2006,  or  (iv)  5.00  percentage
29    points  for each of the 12-month periods ending September 30,
30    2000 through September 30, 2006 2004 for all  other  electric
31    utilities  or  7.00  percentage points for such utilities for
32    each of  the  12-month  periods  ending  September  30,  2000
33    through  September  30,  2006  2004 for any such utility that
34    commits not to petition pursuant  to  Section  16-108(f)  for
 
                            -24-           LRB9212879JSpcam09
 1    entry  of an order by the Commission authorizing the electric
 2    utility to implement transition  charges  for  an  additional
 3    period after December 31, 2006 or 11.00 percentage points for
 4    each  of  the  12-month periods ending September 30, 2005 and
 5    September  30,  2006  for  each  electric  utility  providing
 6    service to fewer than 6,500, or between 75,000  and  150,000,
 7    electric retail customers in this State on January 1, 1995 if
 8    such  utility  commits  not  to  petition pursuant to Section
 9    16-108(f) for entry of an order by the Commission authorizing
10    the electric utility to implement transition charges  for  an
11    additional period after December 31, 2006.
12             (1)  For  purposes  of  this subsection (e), "excess
13        earnings" means the difference  between  (A)  the  2-year
14        average  of  the electric utility's earned rate of return
15        on common equity, less (B) the 2-year average of the  sum
16        of  (i)  the  Index applicable to each of the 2 years and
17        (ii)  1.5  percentage  points;  provided,  that   "excess
18        earnings" shall never be less than zero.
19             (2)  On or before March 31 of each year 2000 through
20        2007  2005 each electric utility shall file a report with
21        the Commission showing  its  earned  rate  of  return  on
22        common   equity,   calculated  in  accordance  with  this
23        subsection, for  the  preceding  calendar  year  and  the
24        average for the preceding 2 calendar years.
25             (3)  If  an  electric  utility  has excess earnings,
26        determined in accordance with paragraphs (1) and  (2)  of
27        this  subsection,  the refunds which the electric utility
28        shall pay  to its customers beginning the  first  billing
29        day  of  April  in the following year shall be calculated
30        and applied as follows:
31                  (i)  The  electric  utility's  excess  earnings
32             shall be multiplied by the average of the  beginning
33             and ending balances of the electric utility's common
34             equity   for  the  2-year  period  in  which  excess
 
                            -25-           LRB9212879JSpcam09
 1             earnings occurred.
 2                  (ii)  The result  of  the  calculation  in  (i)
 3             shall  be  multiplied  by 0.50 and then divided by a
 4             number equal  to  1  minus  the  electric  utility's
 5             composite federal and State income tax rate.
 6                  (iii)  The  result  of  the calculation in (ii)
 7             shall  be  divided  by  the  sum  of  the   electric
 8             utility's  projected  total  kilowatt-hour  sales to
 9             retail customers plus projected kilowatt-hours to be
10             delivered to delivery services customers over a  one
11             year period beginning with the first billing date in
12             April  in  the  succeeding year to determine a cents
13             per kilowatt-hour refund factor.
14                  (iv)  The cents per kilowatt-hour refund factor
15             calculated  in  (iii)  shall  be  credited  to   the
16             electric  utility's customers by applying the factor
17             on   the   customer's   monthly   bills   to    each
18             kilowatt-hour  sold  or  delivered  until  the total
19             amount  calculated  in  (ii)  has   been   paid   to
20             customers.
21        (f)  During  the mandatory transition period, an electric
22    utility may file revised tariffs reducing the  price  of  any
23    tariffed  service  offered  by  the  electric utility for all
24    customers  taking  that  tariffed  service,  which  shall  be
25    effective 7 days after filing.
26        (g)  During the mandatory transition period, an  electric
27    utility may, without obtaining any approval of the Commission
28    other   than   that  provided  for  in  this  subsection  and
29    notwithstanding any other provision of this Act or  any  rule
30    or  regulation  of  the  Commission  that  would require such
31    approval:
32             (1)  implement a reorganization, other than a merger
33        of 2 or more public utilities as defined in Section 3-105
34        or their holding companies;
 
                            -26-           LRB9212879JSpcam09
 1             (2)  retire generating plants from service;
 2             (3)  sell,  assign,  lease  or  otherwise   transfer
 3        assets  to  an  affiliated  or unaffiliated entity and as
 4        part of such transaction enter into  service  agreements,
 5        power  purchase  agreements, or other agreements with the
 6        transferee; provided, however, that the prices, terms and
 7        conditions  of  any  power  purchase  agreement  must  be
 8        approved or allowed into effect  by  the  Federal  Energy
 9        Regulatory Commission; or
10             (4)  use   any   accelerated  cost  recovery  method
11        including    accelerated    depreciation,     accelerated
12        amortization or other capital recovery methods, or record
13        reductions to the original cost of its assets.
14        In order to implement a reorganization, retire generating
15    plants  from  service,  or  sell,  assign, lease or otherwise
16    transfer  assets  pursuant  to  this  Section,  the  electric
17    utility shall comply with subsections (c) and (d) of  Section
18    16-128, if applicable, and subsection (k) of this Section, if
19    applicable,  and provide the Commission with at least 30 days
20    notice of the proposed reorganization or  transaction,  which
21    notice shall include the following information:
22                  (i)  a  complete  statement of the entries that
23             the electric utility will  make  on  its  books  and
24             records   of   account  to  implement  the  proposed
25             reorganization  or  transaction  together   with   a
26             certification  from  an independent certified public
27             accountant that such  entries  are  in  accord  with
28             generally accepted accounting principles and, if the
29             Commission  has  previously  approved guidelines for
30             cost  allocations  between  the  utility   and   its
31             affiliates,   a   certification   from   the   chief
32             accounting  officer of the utility that such entries
33             are in accord with those cost allocation guidelines;
34                  (ii)  a description of how the electric utility
 
                            -27-           LRB9212879JSpcam09
 1             will use proceeds of any sale, assignment, lease  or
 2             transfer  to  retire  debt  or  otherwise  reduce or
 3             recover the  costs  of  services  provided  by  such
 4             electric utility;
 5                  (iii)  a  list  of  all  federal  approvals  or
 6             approvals  required from departments and agencies of
 7             this State, other  than  the  Commission,  that  the
 8             electric   utility   has   or   will  obtain  before
 9             implementing the reorganization or transaction;
10                  (iv)  an irrevocable commitment by the electric
11             utility that  it  will  not,  as  a  result  of  the
12             transaction,  impose  any stranded cost charges that
13             it might  otherwise  be  allowed  to  charge  retail
14             customers   under   federal   law  or  increase  the
15             transition charges that it is otherwise entitled  to
16             collect under this Article XVI; and
17                  (v)  if  the electric utility proposes to sell,
18             assign, lease or  otherwise  transfer  a  generating
19             plant  that  brings  the  amount  of  net dependable
20             generating capacity  transferred  pursuant  to  this
21             subsection to an amount equal to or greater than 15%
22             of the electric utility's net dependable capacity as
23             of  the  effective  date  of  this amendatory Act of
24             1997, and enters into  a  power  purchase  agreement
25             with  the  entity  to which such generating plant is
26             sold, assigned, leased,  or  otherwise  transferred,
27             the  electric  utility  also  agrees,  if   its fuel
28             adjustment clause has not already  been  eliminated,
29             to   eliminate   its   fuel   adjustment  clause  in
30             accordance with subsection (b) of Section 9-220  for
31             a  period  of  time  equal to the length of any such
32             power purchase agreement or successor agreement,  or
33             until  January  1, 2005, whichever is longer; if the
34             capacity of the generating plant so transferred  and
 
                            -28-           LRB9212879JSpcam09
 1             related  power purchase agreement does not result in
 2             the elimination of the fuel adjustment clause  under
 3             this  subsection, and the fuel adjustment clause has
 4             not already been eliminated,  the  electric  utility
 5             shall  agree  that  the  costs  associated  with the
 6             transferred  plant  that   are   included   in   the
 7             calculation  of  the  rate  per  kilowatt-hour to be
 8             applied pursuant  to  the  electric  utility's  fuel
 9             adjustment  clause  during  such  period  shall  not
10             exceed  the  per  kilowatt-hour cost associated with
11             such  generating  plant  included  in  the  electric
12             utility's fuel adjustment  clause  during  the  full
13             calendar  year  preceding  the  transfer,  with such
14             limit to be  adjusted each year  thereafter  by  the
15             Gross Domestic Product Implicit Price Deflator.
16                  (vi)  In  addition,  if  the  electric  utility
17             proposes  to  sell, assign, or lease, (A) either (1)
18             an amount of generating plant that brings the amount
19             of net dependable  generating  capacity  transferred
20             pursuant to this subsection to an amount equal to or
21             greater  than  15% of its net dependable capacity on
22             the effective date of this amendatory Act  of  1997,
23             or  (2)  one  or more generating plants with a total
24             net dependable capacity of 1100  megawatts,  or  (B)
25             transmission and distribution facilities that either
26             (1)   bring   the   amount   of   transmission   and
27             distribution facilities transferred pursuant to this
28             subsection to an amount equal to or greater than 15%
29             of the electric utility's total depreciated original
30             cost investment in such facilities, or (2) represent
31             an  investment  of  $25,000,000  in  terms  of total
32             depreciated  original  cost,  the  electric  utility
33             shall provide, in addition to the information listed
34             in subparagraphs  (i)  through  (v),  the  following
 
                            -29-           LRB9212879JSpcam09
 1             information:  (A)  a description of how the electric
 2             utility will meet its service obligations under this
 3             Act in a  safe  and  reliable  manner  and  (B)  the
 4             electric  utility's  projected earned rate of return
 5             on common  equity,  calculated  in  accordance  with
 6             subsection  (d)  of this Section, for each year from
 7             the date of the notice  through  December  31,  2006
 8             2004 both with and without the proposed transaction.
 9             If the Commission has not issued an order initiating
10             a hearing on the proposed transaction within 30 days
11             after  the  date  the  electric  utility's notice is
12             filed, the transaction  shall  be  deemed  approved.
13             The   Commission  may,  after  notice  and  hearing,
14             prohibit the proposed transaction if it makes either
15             or both of the  following  findings:  (1)  that  the
16             proposed   transaction   will  render  the  electric
17             utility unable to provide its tariffed services in a
18             safe and reliable manner, or (2)  that  there  is  a
19             strong  likelihood that consummation of the proposed
20             transaction will  result  in  the  electric  utility
21             being  entitled  to  request an increase in its base
22             rates  during  the   mandatory   transition   period
23             pursuant  to  subsection  (d)  of this Section.  Any
24             hearing  initiated  by  the  Commission   into   the
25             proposed  transaction  shall  be  completed, and the
26             Commission's final order  approving  or  prohibiting
27             the proposed transaction shall be entered, within 90
28             days  after  the  date the electric utility's notice
29             was  filed.  Provided,   however,   that   a   sale,
30             assignment,  or  lease of transmission facilities to
31             an  independent  system  operator  that  meets   the
32             requirements  of Section 16-126 shall not be subject
33             to Commission approval under this Section.
34                  In any proceeding conducted by  the  Commission
 
                            -30-           LRB9212879JSpcam09
 1             pursuant  to  this  subparagraph  (vi), intervention
 2             shall be limited to parties with a  direct  interest
 3             in  the  transaction  which  is  the  subject of the
 4             hearing and any statutory consumer protection agency
 5             as defined in subsection  (d)  of  Section  9-102.1.
 6             Notwithstanding  the provisions of Section 10-113 of
 7             this Act, any application seeking  rehearing  of  an
 8             order  issued  under this subparagraph (vi), whether
 9             filed by the electric utility or by  an  intervening
10             party,  shall  be filed within 10 days after service
11             of the order.
12        The Commission shall not in any subsequent proceeding  or
13    otherwise,  review such a reorganization or other transaction
14    authorized by this Section, but shall retain the authority to
15    allocate costs as stated in Section 16-111(i). An  entity  to
16    which an electric utility sells, assigns, leases or transfers
17    assets pursuant to this subsection (g) shall not, as a result
18    of  the  transactions  specified  in  this subsection (g), be
19    deemed a public utility as defined in Section 3-105.  Nothing
20    in this subsection (g) shall change any requirement under the
21    jurisdiction of the Illinois  Department  of  Nuclear  Safety
22    including,  but  not limited to, the payment of fees. Nothing
23    in this subsection (g) shall exempt a utility from  obtaining
24    a  certificate  pursuant to Section 8-406 of this Act for the
25    construction of a new electric generating facility.   Nothing
26    in this subsection (g) is intended to exempt the transactions
27    hereunder   from  the  operation  of  the  federal  or  State
28    antitrust laws. Nothing in this subsection (g) shall  require
29    an  electric  utility to use the procedures specified in this
30    subsection for any of the transactions specified herein.  Any
31    other procedure available under this Act may, at the electric
32    utility's election, be used for any such transaction.
33        (h)  During  the   mandatory   transition   period,   the
34    Commission   shall   not   establish  or  use  any  rates  of
 
                            -31-           LRB9212879JSpcam09
 1    depreciation, which for purposes  of  this  subsection  shall
 2    include  amortization,  for  any  electric utility other than
 3    those established pursuant to subsection (c) of Section 5-104
 4    of this Act or utilized pursuant to subsection  (g)  of  this
 5    Section.  Provided, however, that in any proceeding to review
 6    an electric utility's rates for tariffed services pursuant to
 7    Section  9-201,  9-202,  9-250  or 16-111(d) of this Act, the
 8    Commission may establish new rates of  depreciation  for  the
 9    electric  utility  in  the same manner provided in subsection
10    (d) of  Section  5-104  of  this  Act.  An  electric  utility
11    implementing  an  accelerated  cost recovery method including
12    accelerated depreciation, accelerated amortization  or  other
13    capital  recovery  methods,  or  recording  reductions to the
14    original cost of its assets, pursuant to  subsection  (g)  of
15    this  Section,  shall  file  a  statement with the Commission
16    describing  the  accelerated  cost  recovery  method  to   be
17    implemented  or  the  reduction  in  the original cost of its
18    assets to be recorded.  Upon the filing  of  such  statement,
19    the  accelerated cost recovery method or the reduction in the
20    original cost of assets shall be deemed to be approved by the
21    Commission as  though  an  order  had  been  entered  by  the
22    Commission.
23        (i)  Subsequent  to  the mandatory transition period, the
24    Commission, in any proceeding to establish rates and  charges
25    for  tariffed  services offered by an electric utility, shall
26    consider only (1) the then  current  or  projected  revenues,
27    costs, investments and cost of capital directly or indirectly
28    associated  with the provision of such tariffed services; (2)
29    collection of transition charges in accordance with  Sections
30    16-102  and  16-108 of this Act; (3) recovery of any employee
31    transition costs as described in  Section  16-128  which  the
32    electric  utility  is continuing to incur, including recovery
33    of any unamortized portion of such costs previously  incurred
34    or committed, with such costs to be equitably allocated among
 
                            -32-           LRB9212879JSpcam09
 1    bundled  services,  delivery  services,  and  contracts  with
 2    alternative  retail  electric  suppliers; and (4) recovery of
 3    the costs associated with the electric  utility's  compliance
 4    with  decommissioning  funding  requirements;  and  shall not
 5    consider any other revenues, costs, investments  or  cost  of
 6    capital of either the electric utility or of any affiliate of
 7    the  electric  utility  that  are  not  associated  with  the
 8    provision   of  tariffed  services.   In  setting  rates  for
 9    tariffed services, the Commission  shall  equitably  allocate
10    joint  and  common costs and investments between the electric
11    utility's competitive and tariffed services.  In  determining
12    the  justness  and  reasonableness  of the electric power and
13    energy component of an electric utility's rates for  tariffed
14    services  subsequent  to  the mandatory transition period and
15    prior to the time that the provision of such  electric  power
16    and  energy  is  declared  competitive,  the Commission shall
17    consider the extent to which the electric utility's  tariffed
18    rates  for  such component for each customer class exceed the
19    market value determined pursuant to Section 16-112,  and,  if
20    the electric power and energy component of such tariffed rate
21    exceeds  the  market  value by more than 10% for any customer
22    class, may establish such electric power and energy component
23    at a rate equal to the market value plus  10%.  In  any  such
24    case,  the Commission may also elect to extend the provisions
25    of Section 16-111(e) for any period  in  which  the  electric
26    utility  is  collecting transition charges, using information
27    applicable to such period.
28        (j)  During the mandatory transition period, an  electric
29    utility  may  elect  to  transfer  to  a non-operating income
30    account under the Commission's  Uniform  System  of  Accounts
31    either or both of (i) an amount of unamortized investment tax
32    credit  that  is  in  addition to the ratable amount which is
33    credited to the electric utility's operating  income  account
34    for  the  year  in  accordance  with  Section 46(f)(2) of the
 
                            -33-           LRB9212879JSpcam09
 1    federal Internal Revenue Code of 1986, as in effect prior  to
 2    P.L.  101-508, or (ii) "excess tax reserves", as that term is
 3    defined in Section 203(e)(2)(A) of the federal Tax Reform Act
 4    of 1986, provided that (A) the  amount  transferred  may  not
 5    exceed  the amount of the electric utility's assets that were
 6    created  pursuant  to  Statement  of   Financial   Accounting
 7    Standards  No.  71 which the electric utility has written off
 8    during the mandatory transition period, and (B) the  transfer
 9    shall not be effective until approved by the Internal Revenue
10    Service.   An  electric  utility  electing  to  make  such  a
11    transfer  shall  file a statement with the Commission stating
12    the amount and timing of the transfer for which it intends to
13    request approval of the Internal Revenue Service, along  with
14    a  copy  of  its  proposed  request  to  the Internal Revenue
15    Service for a ruling.  The Commission shall  issue  an  order
16    within 14 days after the electric utility's filing approving,
17    subject  to  receipt  of  approval  from the Internal Revenue
18    Service, the proposed transfer.
19        (k)  If an electric utility is selling or transferring to
20    a single buyer 5 or more generating plants  located  in  this
21    State  with a total net dependable capacity of 5000 megawatts
22    or more pursuant to subsection (g) of this  Section  and  has
23    obtained  a  sale price or consideration that exceeds 200% of
24    the book value of such  plants,  the  electric  utility  must
25    provide  to  the  Governor,  the  President  of  the Illinois
26    Senate, the Minority  Leader  of  the  Illinois  Senate,  the
27    Speaker  of  the  Illinois  House of Representatives, and the
28    Minority Leader of the Illinois House of  Representatives  no
29    later  than  15 days after filing its notice under subsection
30    (g) of this Section or 5 days after the date  on  which  this
31    subsection  (k)  becomes  law,  whichever is later, a written
32    commitment in which such electric utility agrees to expend $2
33    billion outside the corporate limits of any municipality with
34    1,000,000 or more inhabitants within such electric  utility's
 
                            -34-           LRB9212879JSpcam09
 1    service  area,  over  a  6-year  period  beginning  with  the
 2    calendar  year  in  which  the  notice is filed, on projects,
 3    programs, and improvements within its service  area  relating
 4    to   transmission   and   distribution   including,   without
 5    limitation, infrastructure expansion, repair and replacement,
 6    capital   investments,   operations   and   maintenance,  and
 7    vegetation management.
 8    (Source: P.A. 90-561, eff. 12-16-97; 90-563,  eff.  12-16-97;
 9    91-50, eff. 6-30-99.)

10        (220 ILCS 5/16-111.3 new)
11        Sec.  16-111.3.  Transition period earnings calculations.
12    At such time as the Board of Governors of the Federal Reserve
13    System ceases  to  include  the  monthly  average  yields  of
14    30-year  U.S.  Treasury  bonds in its weekly H.15 Statistical
15    Release  or  successor  publication,  the  Monthly   Treasury
16    Long-Term Average Rates (25 years and above) published by the
17    Board  of  Governors  of  the  Federal  Reserve System in its
18    weekly H.15  Statistical  Release  or  successor  publication
19    shall  instead be used to establish a rate for the purpose of
20    calculating the Index defined in subsection  (e)  of  Section
21    16-111  of  this Act, and at such time, such Monthly Treasury
22    Long-Term Average Rates (25 years and above)  shall  also  be
23    used  in  place of the monthly average yields of 30-year U.S.
24    Treasury bonds in the rate of return calculation required  by
25    subsection  (d) of Section 16-111.  An electric utility shall
26    also remove the effects, if any, of any impairment due to the
27    application of Statement of  Financial  Accounting  Standards
28    No.  142,  which  was  issued  in  June 2001, when making the
29    calculations required by this Section or by  subsections  (d)
30    and (e) of Section 16-111.

31        Section  99.  Effective date.  This Act takes effect upon
32    becoming law.".

[ Top ]