(REPRINTED WITH ADOPTED AMENDMENTS)

 

Assembly Bill No. 369–Select Committee on Energy

 

March 14, 2001

____________

 

Referred to Select Committee on Energy

 

SUMMARY—Revises and repeals various provisions governing the regulation of public utilities. (BDR 58‑1156)

 

FISCAL NOTE:  Effect on Local Government: No.

                             Effect on the State: No.

 

~

 

EXPLANATION – Matter in bolded italics is new; matter between brackets [omitted material] is material to be omitted.

 

AN ACT relating to utilities; revising and repealing various provisions governing the regulation of public utilities; preventing certain electric utilities from disposing of certain generation assets for a certain period; placing restrictions on the disposal of such assets after that period; requiring certain electric utilities to use deferred accounting under certain circumstances; repealing provisions pertaining to the competitive provision of retail electric service; requiring the public utilities commission of Nevada to take certain actions to carry out the provisions of this act; establishing certain requirements and making various changes relating to the rates charged by certain electric utilities; requiring certain entities to obtain approval from the commission before carrying out certain transactions; and providing other matters properly relating thereto.

 

   Whereas, In 1997, the legislature enacted comprehensive legislation designed to prepare the electric industry in this state for retail competition; and

   Whereas, In 1999, the legislature enacted additional legislation delaying the onset of such competition until March 1, 2000, unless a determination was made that a later date was necessary to protect the public interest; and

   Whereas, On several occasions, a determination has been made that commencement of retail competition in the electric industry is not yet in the public interest of this state; and

   Whereas, Many residents of this state are senior citizens whose health is especially vulnerable to extreme heat and extreme cold and who rely on electricity to provide safe temperatures in their homes; and

   Whereas, In arid regions of this state, there are many population centers that cannot be sustained without electricity to pump potable drinking water; and

   Whereas, Several of the major industries in this state are particularly dependent upon electricity; and

   Whereas, Under present market conditions in the electric industry, comprehensive and effective regulation of electric utilities in this state is vital to the economy of this state and is essential to protect the health, safety and welfare of the residents of this state; and

   Whereas, Until present market conditions have changed and adequate mechanisms have been developed to allow this state to adjust its comprehensive regulation of electric utilities in Nevada, this state has a compelling interest in continuing its comprehensive regulation of electric utilities to protect the consumers in this state, to safeguard the economy of this state and to ensure that the electric utilities in this state provide adequate and reliable electric service at just and reasonable prices; and

   Whereas, As part of its comprehensive regulation of electric utilities in Nevada, this state has traditionally exercised its inherent jurisdiction over electric generation assets which have been dedicated to serve the public convenience and necessity in Nevada and which are used and useful for the convenience of the public in Nevada; and

   Whereas, To control volatility in the price of electricity in the retail market and to ensure that the electric utilities in this state have necessary and sufficient resources to provide adequate and reliable electric service under present market conditions, this state must retain its traditional jurisdiction and control over electric generation assets until other mechanisms are available to accomplish these goals; and

   Whereas, In recent years, the western United States has experienced a severe and ongoing crisis in the electric industry marked by critical shortages in the supply of electricity and extreme volatility in the price of electricity in the wholesale and retail markets; and

   Whereas, The severe and ongoing crisis in the electric industry in the western United States is both an immediate threat and a continuing danger to the economy of this state and to the health, safety and welfare of the residents of this state; and

   Whereas, Until the severe and ongoing crisis in the electric industry in the western United States has sufficiently abated, this state must maintain its comprehensive regulation over electric utilities and its traditionally broad jurisdiction and control over electric generation assets to promote stability and predictability in the electric industry, to foster confidence in the financial markets, to ensure that consumers have adequate and reliable electric service and to protect the public from unjust and unreasonable utility rates; now, therefore,

 

THE PEOPLE OF THE STATE OF NEVADA, REPRESENTED IN

SENATE AND ASSEMBLY, DO ENACT AS FOLLOWS:

 

1-1    Section 1. NRS 703.010 is hereby amended to read as follows:

1-2    703.010  As used in this chapter, unless the context otherwise requires:

1-3    1.  “Alternative seller” [has the meaning ascribed to it in NRS

1-4  704.967.] means a person who sells any competitive, discretionary or

1-5  potentially competitive component of natural gas service pursuant to

1-6  NRS 704.993 to 704.999, inclusive.

1-7    2.  “Commission” means the public utilities commission of Nevada.

2-1    Sec. 2.  NRS 703.025 is hereby amended to read as follows:

2-2    703.025  1.  The commission, by majority vote, shall organize the

2-3  commission into sections, alter the organization of the commission and

2-4  reassign responsibilities and duties of the sections of the commission as the

2-5  commission deems necessary to provide:

2-6    (a) Advice and guidance to the commission on economic policies

2-7  relating to utilities under the jurisdiction of the commission, and the

2-8  regulation of such utilities;

2-9    (b) Administrative, technical, legal and support services to the

2-10  commission; and

2-11  (c) For the regulation of utilities governed by the commission and the

2-12  services offered by such utilities, including, but not limited to, licensing of

2-13  such utilities and services and the resolution of consumer complaints.

2-14  2.  The commission shall:

2-15  (a) Formulate the policies of the various sections of the commission;

2-16  (b) Coordinate the activities of the various sections of the commission;

2-17  (c) [Take such] If customers are authorized by a specific statute to

2-18  obtain a competitive, discretionary or potentially competitive utility

2-19  service, take any actions which are consistent with [law as] the statute and

2-20  which are necessary to encourage and enhance:

2-21      (1) A competitive market for the provision of that utility [services]

2-22  service to customers in this state; and

2-23      (2) The reliability and safety of the provision of [those services] that

2-24  utility service within that competitive market; and

2-25  (d) Adopt such regulations consistent with law as the commission

2-26  deems necessary for the operation of the commission and the enforcement

2-27  of all laws administered by the commission.

2-28  3.  Before reorganizing the commission, the commission shall submit

2-29  the plan for reorganization to:

2-30  (a) The director of the legislative counsel bureau for transmittal to the

2-31  appropriate legislative committee and the interim finance committee; and

2-32  (b) The director of the department of administration.

2-33  Sec. 3. NRS 703.130 is hereby amended to read as follows:

2-34  703.130  1.  The commission shall appoint a deputy commissioner

2-35  who shall serve in the unclassified service of the state.

2-36  2.  The commission shall appoint a secretary who shall perform such

2-37  administrative and other duties as are prescribed by the commission. The

2-38  commission shall also appoint an assistant secretary.

2-39  3.  The commission may employ such other clerks, experts or engineers

2-40  as may be necessary.

2-41  4.  [The commission may] Except as otherwise provided in subsection

2-42  5, the commission:

2-43  (a) May appoint one or more hearing officers for a period specified by

2-44  the commission to conduct proceedings or hearings that may be conducted

2-45  by the commission pursuant to chapters 704, 704A, 705, 708 and 711 of

2-46  NRS. [The commission shall]

2-47  (b) Shall prescribe by regulation the procedure for appealing a decision

2-48  of a hearing officer to the commission.

3-1    5.  The commission shall not appoint a hearing officer to conduct

3-2  proceedings or hearings pursuant to sections 8 to 18, inclusive, of this

3-3  act.

3-4    Sec. 4.  NRS 703.151 is hereby amended to read as follows:

3-5    703.151  In adopting regulations pursuant to this Title relating to the

3-6  provision of electric service, the commission shall ensure that the

3-7  regulations:

3-8    1.  [Maximize the benefits of a competitive marketplace for the

3-9  provision of electric services;

3-10  2.  Maintain, to the extent possible, even and fair competition among

3-11  providers of electric service;

3-12  3.  Ensure the flexibility necessary for existing utilities that provide

3-13  energy to enter into a deregulated market;

3-14  4.  Foster innovation in the provision of electric services;

3-15  5.  Ensure and enhance reliability and safety in the provision of electric

3-16  services;

3-17  6.  Provide for flexible mechanisms for regulating electric services; and

3-18  7.] Protect, further and serve the public interest;

3-19  2.  Provide effective protection [of persons] for customers who depend

3-20  upon electric [services.] service;

3-21  3.  Provide for stability in rates and for the availability and reliability

3-22  of electric service;

3-23  4.  Encourage the development and use of renewable energy

3-24  resources; and

3-25  5.  Require providers of electric service to engage in prudent business

3-26  management, effective long-term planning, responsible decision making,

3-27  sound fiscal strategies and efficient operations.

3-28  Sec. 5.  NRS 703.320 is hereby amended to read as follows:

3-29  703.320  1.  [When, in] In any matter pending before the commission,

3-30  if a hearing is required by [law,] a specific statute or is [normally]

3-31  otherwise required by the commission, the commission shall give notice of

3-32  the pendency of the matter to all persons entitled to notice of the hearing.

3-33  The commission shall by regulation specify:

3-34  (a) The manner of giving notice[;] in each type of proceeding; and

3-35  (b) [Where not specified by law, the] The persons entitled to notice in

3-36  each type of proceeding.

3-37  2.  [Unless,] The commission shall not dispense with a hearing in any

3-38  matter pending before the commission pursuant to sections 8 to 18,

3-39  inclusive, of this act.

3-40  3.  In any other matter pending before the commission, the

3-41  commission may dispense with a hearing and act upon the matter

3-42  pending unless, within 10 days after the date of the notice of pendency, a

3-43  person entitled to notice of the hearing files with the commission a request

3-44  that the hearing be held . [, the commission may dispense with a hearing

3-45  and act upon the matter pending.

3-46  3.] If such a request for a hearing is filed, the commission shall give at

3-47  least 10 days’ notice of the hearing.

3-48  Sec. 6. Chapter 704 of NRS is hereby amended by adding thereto the

3-49  provisions set forth as sections 7 to 19, inclusive, of this act.

4-1    Sec. 7.  As used in this section and NRS 704.330 to 704.430,

4-2  inclusive, unless the context otherwise requires, “electric utility” has the

4-3  meaning ascribed to it in section 12 of this act.

4-4    Sec. 8.  As used in sections 8 to 18, inclusive, of this act, unless the

4-5  context otherwise requires, the words and terms defined in sections 9 to

4-6  15, inclusive, of this act have the meanings ascribed to them in those

4-7  sections.

4-8    Sec. 9.  “Affiliate” means a person who, directly or indirectly

4-9  through one or more intermediaries, controls, is controlled by or is under

4-10  common control with an electric utility.

4-11  Sec. 10.  “Consumer’s advocate” means the consumer’s advocate of

4-12  the bureau of consumer protection in the office of the attorney general.

4-13  Sec. 11.  “Dispose of a generation asset” means to:

4-14  1.  Sell, lease, assign, transfer or divest an interest in a generation

4-15  asset, in whole or in part, to another person; or

4-16  2.  Perform any promise, covenant or obligation to sell, lease, assign,

4-17  transfer or divest an interest in a generation asset, in whole or in part, to

4-18  another person pursuant to the terms of a contract or agreement

4-19  executed before, on or after the effective date of this act unless, before

4-20  the effective date of this act:

4-21  (a) All terms and conditions of the contract or agreement were

4-22  satisfied; and

4-23  (b) All parties to the contract or agreement fully performed all

4-24  promises, covenants and obligations under the contract or agreement.

4-25  Sec. 12.  1.  “Electric utility” means:

4-26  (a) Any public utility or successor in interest that:

4-27      (1) Is in the business of providing electric service to customers;

4-28      (2) Holds a certificate of public convenience and necessity issued or

4-29  transferred pursuant to this chapter; and

4-30      (3) In the most recently completed calendar year or in any other

4-31  calendar year within the 7 calendar years immediately preceding the

4-32  most recently completed calendar year, had a gross operating revenue of

4-33  $250,000,000 or more in this state;

4-34  (b) A subsidiary or affiliate of such a public utility;

4-35  (c) A holding company or other person that holds a controlling

4-36  interest in such a public utility; and

4-37  (d) A successor in interest to any public utility, subsidiary, affiliate,

4-38  holding company or person described in paragraph (a), (b) or (c).

4-39  2.  The term does not include a cooperative association, nonprofit

4-40  corporation, nonprofit association or provider of electric service which is

4-41  declared to be a public utility pursuant to NRS 704.673 and which

4-42  provides service only to its members.

4-43  Sec. 13.  1.  “Generation asset” means any plant, facility,

4-44  equipment or system that:

4-45  (a) Converts other forms of energy into electricity or otherwise

4-46  produces electricity;

4-47  (b) Is or was owned, possessed, controlled, leased, operated,

4-48  administered, maintained, acquired or placed into service by an electric

4-49  utility before, on or after January 1, 2001;

5-1    (c) Is subject, in whole or in part, to regulation by the commission;

5-2  and

5-3    (d) Is used and useful for the convenience of the public in this state,

5-4  as determined by the commission.

5-5    2.  The term does not include:

5-6    (a) Any hydroelectric plant, facility, equipment or system which has a

5-7  generating capacity of not more than 15 megawatts and which is located

5-8  on the Truckee River or on a waterway that is appurtenant to or

5-9  connected to the Truckee River.

5-10  (b) Any net metering system, as defined in NRS 704.771.

5-11  Sec. 14.  1.  “Interest in a generation asset” means any interest, in

5-12  whole or in part, in the physical plant, facility, equipment or system that

5-13  makes up the generation asset, whether such interest is legal or

5-14  equitable, present or future, or contingent or vested.

5-15  2.  The term does not include any interest in the electricity or other

5-16  energy produced by the generation asset.

5-17  Sec. 15.  “Person” means:

5-18  1.  A natural person;

5-19  2.  Any form of business or social organization and any other

5-20  nongovernmental legal entity, including, without limitation, a

5-21  corporation, partnership, association, trust or unincorporated

5-22  organization;

5-23  3.  A government or an agency or instrumentality of a government,

5-24  including, without limitation, this state or an agency or instrumentality

5-25  of this state; and

5-26  4.  A political subdivision of this state or of any other government or

5-27  an agency or instrumentality of a political subdivision of this state or of

5-28  any other government.

5-29  Sec. 16.  Except as otherwise provided in section 17 of this act:

5-30  1.  Before July 1, 2003, an electric utility shall not dispose of a

5-31  generation asset.

5-32  2.  On or after July 1, 2003, an electric utility shall not dispose of a

5-33  generation asset unless, before the disposal, the commission approves the

5-34  disposal by a written order issued in accordance with the provisions of

5-35  this section.

5-36  3.  Not sooner than January 1, 2003, an electric utility may file with

5-37  the commission an application to dispose of a generation asset on or

5-38  after July 1, 2003. If an electric utility files such an application, the

5-39  commission shall not approve the application unless the commission

5-40  finds that the disposal of the generation asset will be in the public

5-41  interest. The commission shall issue a written order approving or

5-42  disapproving the application. The commission may base its approval of

5-43  the application upon such terms, conditions or modifications as the

5-44  commission deems appropriate.

5-45  4.  If an electric utility files an application to dispose of a generation

5-46  asset, the consumer’s advocate shall be deemed a party of record.

5-47  5.  If the commission approves an application to dispose of a

5-48  generation asset before July 1, 2003, the order of the commission

5-49  approving the application:

6-1    (a) May not become effective sooner than July 1, 2003;

6-2    (b) Does not create any vested rights before the effective date of the

6-3  order; and

6-4    (c) For the purposes of NRS 703.373, shall be deemed a final decision

6-5  on the date on which the order is issued by the commission.

6-6    Sec. 17.  1.  An electric utility may dispose of its generation assets

6-7  pursuant to a merger, acquisition or transaction that is authorized

6-8  pursuant to NRS 704.329 or pursuant to a transfer of its certificate of

6-9  public convenience and necessity that is authorized pursuant to NRS

6-10  704.410, if:

6-11  (a) The electric utility disposes of substantially all of its generation

6-12  assets and substantially all of its other assets to the other person in the

6-13  merger, acquisition, transaction or transfer; and

6-14  (b) The other person in the merger, acquisition, transaction or

6-15  transfer is not a subsidiary or affiliate of the electric utility or a holding

6-16  company or other person that holds a controlling interest in the electric

6-17  utility.

6-18  2.  Any person who assumes or has assumed ownership, possession,

6-19  control, operation, administration or maintenance of a generation asset

6-20  pursuant to a merger, acquisition, transaction or transfer described in

6-21  subsection 1 is subject to the provisions of sections 8 to 18, inclusive, of

6-22  this act.

6-23  Sec. 18. If an electric utility disposes of a generation asset in

6-24  violation of sections 8 to 18, inclusive, of this act, the disposal is void and

6-25  unenforceable and is not valid for any purpose.

6-26  Sec. 19.  1.  Except as otherwise provided in section 36 of this act,

6-27  beginning on March 1, 2001, an electric utility that purchases fuel or

6-28  power shall use deferred accounting by recording upon its books and

6-29  records in deferred accounts all increases and decreases in costs for

6-30  purchased fuel and purchased power that are prudently incurred by the

6-31  electric utility.

6-32  2.  An electric utility using deferred accounting shall include in its

6-33  annual report to the commission a statement showing, for the period of

6-34  recovery, the allocated rate of return for each of its operating

6-35  departments in this state using deferred accounting. If, during the period

6-36  of recovery, the rate of return for any operating department using

6-37  deferred accounting is greater than the rate of return authorized by the

6-38  commission in the most recently completed rate proceeding for the

6-39  electric utility, the commission shall order the electric utility that

6-40  recovered costs for purchased fuel or purchased power through its rates

6-41  during the reported period to transfer to the next energy adjustment

6-42  period that portion of the amount recovered by the electric utility that

6-43  exceeds the authorized rate of return.

6-44  3.  Except as otherwise provided in subsection 4, an electric utility

6-45  using deferred accounting shall file an application to clear its deferred

6-46  accounts after the end of each 12-month period of deferred accounting.

6-47  4.  An electric utility using deferred accounting may file an

6-48  application to clear its deferred accounts after the end of a 6-month

6-49  period of deferred accounting if the net increase or decrease in revenues

7-1  necessary to clear its deferred accounts for the 6-month period is more

7-2  than 5 percent of the total revenues generated by the electric utility

7-3  during that period from its rates for purchased fuel and purchased power

7-4  most recently authorized by the commission.

7-5    5.  The commission shall adopt regulations prescribing the period

7-6  within which an electric utility must file an application to clear its

7-7  deferred accounts after the end of a period of deferred accounting.

7-8    6.  As used in this section:

7-9    (a) “Application to clear its deferred accounts” means an application

7-10  filed by an electric utility pursuant to this section and subsection 7 of

7-11  NRS 704.110.

7-12  (b) “Costs for purchased fuel and purchased power” means all costs

7-13  which are prudently incurred by an electric utility and which are

7-14  required to purchase fuel, to purchase capacity and to purchase energy.

7-15  The term does not include any costs that the commission determines are

7-16  not recoverable pursuant to subsection 8 of NRS 704.110.

7-17  (c) “Electric utility” means any public utility or successor in

7-18   interest that:

7-19      (1) Is in the business of providing electric service to customers;

7-20      (2) Holds a certificate of public convenience and necessity issued or

7-21  transferred pursuant to this chapter; and

7-22      (3) In the most recently completed calendar year or in any other

7-23  calendar year within the 7 calendar years immediately preceding the

7-24  most recently completed calendar year, had a gross operating revenue of

7-25  $250,000,000 or more in this state.

7-26  The term does not include a cooperative association, nonprofit

7-27  corporation, nonprofit association or provider of electric service which is

7-28  declared to be a public utility pursuant to NRS 704.673 and which

7-29  provides service only to its members.

7-30  Sec. 20. NRS 704.030 is hereby amended to read as follows:

7-31  704.030  “Public utility” or “utility” does not include:

7-32  1.  Persons engaged in the production and sale of natural gas, other than

7-33  sales to the public, or engaged in the transmission of natural gas other than

7-34  as a common carrier transmission or distribution line or system.

7-35  2.  Persons engaged in the business of furnishing, for compensation,

7-36  water or services for the disposal of sewage, or both, to persons within this

7-37  state if:

7-38  (a) They serve 25 persons or less; and

7-39  (b) Their gross sales for water or services for the disposal of sewage, or

7-40  both, amounted to $5,000 or less during the immediately preceding 12

7-41  months.

7-42  3.  Persons not otherwise engaged in the business of furnishing,

7-43  producing or selling water or services for the disposal of sewage, or both,

7-44  but who sell or furnish water or services for the disposal of sewage, or

7-45  both, as an accommodation in an area where water or services for the

7-46  disposal of sewage, or both, are not available from a public utility,

7-47  cooperative corporations and associations or political subdivisions engaged

7-48  in the business of furnishing water or services for the disposal of sewage,

7-49  or both, for compensation, to persons within the political subdivision.

8-1    4.  Persons who are engaged in the production and sale of energy,

8-2  including electricity, to public utilities, cities, counties or other entities

8-3  which are reselling the energy to the public.

8-4    5.  Persons who are subject to the provisions of NRS 590.465 to

8-5  590.645, inclusive.

8-6    6.  Persons who are engaged in the sale or use of special fuel as defined

8-7  in NRS 366.060.

8-8    7.  [Persons who are licensed as alternative sellers to provide electric

8-9  services.

8-10  8.] Persons who provide water from water storage, transmission and

8-11  treatment facilities if those facilities are for the storage, transmission or

8-12  treatment of water from mining operations.

8-13  Sec. 21. NRS 704.110 is hereby amended to read as follows:

8-14  704.110  Except as otherwise provided in NRS 704.075 or as otherwise

8-15  provided by the commission pursuant to NRS 704.095 or 704.097:

8-16  1.  Whenever there is filed with the commission any schedule stating a

8-17  new or revised individual or joint rate or charge, or any new or revised

8-18  individual or joint regulation or practice affecting any rate or charge, or

8-19  any schedule resulting in a discontinuance, modification or restriction of

8-20  service, the commission may, upon complaint or upon its own motion

8-21  without complaint, at once, without answer or formal pleading by the

8-22  interested utility, investigate or, upon reasonable notice, conduct a hearing

8-23  concerning the propriety of the rate, charge, classification, regulation,

8-24  discontinuance, modification, restriction or practice.

8-25  2.  Pending the investigation or hearing and the decision thereon, the

8-26  commission, upon delivering to the utility affected thereby a statement in

8-27  writing of its reasons for the suspension, may suspend the operation of the

8-28  schedule and defer the use of the rate, charge, classification, regulation,

8-29  discontinuance, modification, restriction or practice . [, but] If the rate,

8-30  charge, classification, regulation, discontinuance, modification,

8-31  restriction or practice is part of:

8-32  (a) A filing made pursuant to subsection 7, the suspension must not be

8-33  effective for more than 90 days beyond the time when the rate, charge,

8-34  classification, regulation, discontinuance, modification, restriction or

8-35  practice would otherwise go into effect.

8-36  (b) Any other filing made pursuant to this section, the suspension

8-37  must not be effective for more than 150 days beyond the time when the

8-38  rate, charge, classification, regulation, discontinuance, modification,

8-39  restriction or practice would otherwise go into effect.

8-40  3.  Whenever there is filed with the commission any schedule stating an

8-41  increased individual or joint rate or charge for service or equipment, the

8-42  public utility shall submit with its application a statement showing the

8-43  recorded results of revenues, expenses, investments and costs of capital for

8-44  its most recent 12 months for which data were available when the

8-45  application was prepared. During any hearing concerning the increased

8-46  rates or charges determined by the commission to be necessary, the

8-47  commission shall consider evidence in support of the increased rates or

8-48  charges based upon actual recorded results of operations for the same 12

8-49  months, adjusted for increased revenues, any increased investment in

9-1  facilities, increased expenses for depreciation, certain other operating

9-2  expenses as approved by the commission and changes in the costs of

9-3  securities which are known and are measurable with reasonable accuracy at

9-4  the time of filing and which will become effective within 6 months after

9-5  the last month of those 12 months, but no new rates or charges may be

9-6  placed into effect until the changes have been experienced and certified by

9-7  the utility to the commission. The commission shall also consider evidence

9-8  supporting expenses for depreciation, calculated on an annual basis,

9-9  applicable to major components of the public utility’s plant placed into

9-10  service during the recorded test period or the period for certification as set

9-11  forth in the application. Adjustments to revenues, operating expenses and

9-12  costs of securities must be calculated on an annual basis. Within 90 days

9-13  after the filing with the commission of the certification required in this

9-14  subsection, or before the expiration of any period of suspension ordered

9-15  pursuant to subsection 2, whichever time is longer, the commission shall

9-16  make such order in reference to those rates or charges as is required by this

9-17  chapter. An electric utility shall file a general rate application pursuant to

9-18  this subsection at least once every 24 months.

9-19  4.  After full investigation or hearing, whether completed before or

9-20  after the date upon which the rate, charge, classification, regulation,

9-21  discontinuance, modification, restriction or practice is to go into effect, the

9-22  commission may make such order in reference to the rate, charge,

9-23  classification, regulation, discontinuance, modification, restriction or

9-24  practice as would be proper in a proceeding initiated after the rate, charge,

9-25  classification, regulation, discontinuance, modification, restriction or

9-26  practice has become effective.

9-27  5.  Except as otherwise provided in subsection 6, whenever a general

9-28  rate application for an increased rate or charge for, or classification,

9-29  regulation, discontinuance, modification, restriction or practice involving

9-30  service or equipment has been filed with the commission, a public utility

9-31  shall not submit another general rate application until all pending general

9-32  rate applications for increases in rates submitted by that public utility have

9-33  been decided unless, after application and hearing, the commission

9-34  determines that a substantial financial emergency would exist if the other

9-35  application is not permitted to be submitted sooner.

9-36  6.  A public utility may [not] file an application to recover the

9-37  increased cost of purchased fuel, purchased power, or natural gas

9-38  purchased for resale [more often than] once every 30 days. The provisions

9-39  of this subsection do not apply to an electric utility using deferred

9-40  accounting pursuant to section 19 of this act.

9-41  7.  Except as otherwise provided in subsection 8, whenever an electric

9-42  utility using deferred accounting pursuant to section 19 of this act files

9-43  an application to clear its deferred accounts and to change one or more

9-44  of its rates or charges based upon changes in the costs for purchased fuel

9-45  or purchased power, the commission, after a public hearing and by an

9-46  appropriate order:

10-1  (a) Shall allow the electric utility to clear its deferred accounts by

10-2  refunding any credit balance or recovering any debit balance over a

10-3  period not to exceed 3 years, as determined by the commission.

10-4  (b) Shall not allow the electric utility to recover any debit balance, or

10-5  portion thereof, in an amount that would result in a rate of return during

10-6  the period of recovery that exceeds the rate of return authorized by the

10-7  commission in the most recently completed rate proceeding for the

10-8  electric utility.

10-9  8.  Before allowing an electric utility to clear its deferred accounts

10-10  pursuant to subsection 7, the commission shall determine whether the

10-11  costs for purchased fuel and purchased power that the electric utility

10-12  recorded in its deferred accounts are recoverable and whether the

10-13  revenues that the electric utility collected from customers in this state for

10-14  purchased fuel and purchased power are properly recorded and credited

10-15  in its deferred accounts. The commission shall not allow the electric

10-16  utility to recover any costs for purchased fuel and purchased power that:

10-17  (a) Were not necessary to provide electric service to customers in this

10-18  state, including, without limitation, any costs required to purchase

10-19  capacity or energy which was not used by the electric utility to provide

10-20  electric service to customers in this state but which was resold by the

10-21  electric utility at wholesale;

10-22  (b) Were the result of any practice or transaction that was undertaken,

10-23  managed or performed imprudently by the electric utility; or

10-24  (c) Were part of, associated with or related to any transaction or

10-25  interaction with a subsidiary or affiliate of the electric utility or an entity

10-26  that holds a controlling interest in the electric utility and were not

10-27  necessary to provide electric service to customers in this state.

10-28  The commission shall not credit any revenues to the deferred accounts of

10-29  the electric utility which were not earned or generated from providing

10-30  electric service to customers in this state or which were part of,

10-31  associated with or related to any transaction or interaction with a

10-32  subsidiary or affiliate of the electric utility or an entity that holds a

10-33  controlling interest in the electric utility and were not earned or

10-34  generated from providing electric service to customers in this state.

10-35  9.  Whenever an electric utility files an application to clear its

10-36  deferred accounts pursuant to subsection 7 while a general rate

10-37  application is pending, the electric utility shall:

10-38  (a) Submit with its application to clear its deferred accounts

10-39  information relating to the cost of service and rate design; and

10-40  (b) Supplement its general rate application with the same information,

10-41  if such information was not submitted with the general rate application.

10-42  10.  A utility facility identified in a 3-year plan submitted pursuant to

10-43  NRS 704.741 and accepted by the commission for acquisition or

11-1  construction pursuant to NRS 704.751 and the regulations adopted

11-2  pursuant thereto shall be deemed to be a prudent investment. The utility

11-3  may recover all just and reasonable costs of planning and constructing such

11-4  a facility.

11-5  11.  As used in this section, “electric utility” has the meaning

11-6  ascribed to it in section 19 of this act.

11-7  Sec. 22.  NRS 704.329 is hereby amended to read as follows:

11-8  704.329  1.  Except as otherwise provided in [subsection 4, no person

11-9  may]this section, a person shall not merge with, directly acquire,

11-10  indirectly acquire through a subsidiary or affiliate, or otherwise directly or

11-11  indirectly obtain control of a public utility doing business in this state or an

11-12  entity that holds a controlling interest in such a public utility without first

11-13  submitting to the commission an application for authorization of the

11-14  proposed merger, acquisition or other transaction and obtaining

11-15  authorization from the commission .[pursuant to subsection 2.]

11-16  2.  Any merger, acquisition or [change in control in violation]other

11-17  transaction that violates the provisions of this section is void and

11-18  unenforceable andis not valid for any purpose.

11-19  [2.] 3. Before authorizing [the]a proposed merger, acquisition or

11-20  [change in control of a public utility doing business in this state,]other

11-21  transaction pursuant to this section, the commission shall consider the

11-22  effect of the proposed merger, acquisition or other transaction [. If]on the

11-23  public interest and the customers in this state. The commission shall not

11-24  authorize the proposed merger, acquisition or other transaction unless

11-25  the commission finds that the proposed merger, acquisition or [change in

11-26  control is]other transaction:

11-27  (a) Will be in the public interest [, the commission shall authorize the

11-28  proposed transaction.

11-29  3.]; and

11-30  (b) Complies with the provisions of sections 8 to 18, inclusive, of this

11-31  act, if the proposed merger, acquisition or other transaction is subject to

11-32  those provisions.

11-33  4.  The commission may base its authorization of the proposed

11-34  merger, acquisition or other transaction upon such terms, conditions or

11-35  modifications as the commission deems appropriate.

11-36  5.  If the commission does not issue a final [determination]order

11-37  regarding the proposed merger, acquisition or other transaction within 180

11-38  days after the date on which an application or amended application for

11-39  authorization of the proposed merger, acquisition or other transaction was

11-40  filed with the commission, and the proposed merger, acquisition or other

11-41  transaction is not subject to the provisions of sections 8 to 18, inclusive,

11-42  of this act,the proposed merger, acquisition or other transaction shall be

11-43  deemed [approved.]to be authorized by the commission.

11-44  [4.] 6. The provisions of this section do not apply to the transfer of

11-45  stock of a public utility doing business in this state or to the transfer of the

11-46  stock of an entity holding a controlling interest in such a public utility, if a

11-47  transfer of not more than 25 percent of the common stock of such a public

11-48  utility or entity is proposed.

 

12-1  Sec. 23.  NRS 704.370 is hereby amended to read as follows:

12-2  704.370  1.  The commission shall have the power, after hearing, to

12-3  issue or refuse such certificate of public convenience, or to issue it for the

12-4  construction of a portion only of the contemplated line, plant or systems, or

12-5  extension thereof, and may attach thereto such terms and conditions as, in

12-6  its judgment, the public convenience and necessity may require.

12-7  2.  [The] Except as otherwise provided in subsection 3, the

12-8  commission, in its discretion[,] and after investigation, may dispense with

12-9  the hearing on the application if, upon the expiration of the time fixed in

12-10  the notice thereof, no protest against the granting of the [certificate]

12-11  application has been filed by or on behalf of any interested person.

12-12  3.  The commission shall not dispense with the hearing on the

12-13  application of an electric utility.

12-14  Sec. 24.  NRS 704.390 is hereby amended to read as follows:

12-15  704.390  1.  It [shall be] is unlawful for any public utility to

12-16  discontinue, modify or restrict service to any city, town, municipality,

12-17  community or territory theretofore serviced by it, except upon 30 days’

12-18  notice filed with the commission, specifying in detail the character and

12-19  nature of the discontinuance or restriction of the service intended, and upon

12-20  order of the commission, made after hearing, permitting such

12-21  discontinuance, modification or restriction of service.

12-22  2.  [The] Except as otherwise provided in subsection 3, the

12-23  commission , in its discretion and after investigation, may dispense with

12-24  the hearing on the application for discontinuance, modification or

12-25  restriction of service[,] if, upon the expiration of the time fixed in the

12-26  notice thereof, no protest against the granting of the application has been

12-27  filed by or on behalf of any interested person.

12-28  3.  The commission shall not dispense with the hearing on the

12-29  application of an electric utility.

12-30  Sec. 25.  NRS 704.410 is hereby amended to read as follows:

12-31  704.410  1.  Any public utility subject to the provisions of NRS

12-32  [704.005] 704.001 to 704.751, inclusive, and sections 8 to 18, inclusive, of

12-33  this act to which a certificate of public convenience and necessity has been

12-34  issued pursuant to NRS [704.005] 704.001 to 704.751, inclusive, and

12-35  sections 8 to 18, inclusive, of this act may transfer the certificate to any

12-36  person qualified under NRS [704.005] 704.001 to 704.751, inclusive, [but

12-37  the] and sections 8 to 18, inclusive, of this act. Such a transfer is void and

12-38  unenforceable and is not valid for any purpose [until a] unless:

12-39  (a) A joint application to make the transfer has been made to the

12-40  commission by the transferor and the transferee [, and the] ; and

12-41  (b) The commission has authorized the substitution of the transferee for

12-42  the transferor. If the transferor is an electric utility, the commission shall

12-43  not authorize the transfer unless the transfer complies with the

12-44  provisions of sections 8 to 18, inclusive, of this act.

12-45  2.  The commission [may] :

12-46  (a) Shall conduct a hearing on a transfer involving an electric utility.

12-47  The hearing must be noticed and conducted in the same manner as other

12-48  contested hearings before the commission.

13-1  (b) May direct that a hearing be [had in the matter of the transfer.]

13-2  conducted on a transfer involving any other public utility. If the

13-3  commission determines that such a hearing should be held, the hearing

13-4  must be noticed and conducted in the same manner as other contested

13-5  hearings before the commission.

13-6  [3.  The commission has the sole discretion to direct that a hearing be

13-7  held if the application seeks to transfer the certificate from a person or

13-8  partners to a corporation when the officers of the corporation will be

13-9  substantially the same person or partners.

13-10  4.] The commission may dispense with such a hearing if, upon the

13-11  expiration of the time fixed in the notice thereof, no protest to the proposed

13-12  transfer has been filed by or on behalf of any interested person.

13-13  [5.] 3. In determining whether the transfer of a certificate of public

13-14  convenience and necessity to an applicant transferee should be authorized,

13-15  the commission must take into consideration:

13-16  (a) The utility service performed by the transferor and the proposed

13-17  utility service of the transferee;

13-18  (b) Other authorized utility services in the territory for which the

13-19  transfer is sought; [and]

13-20  (c) Whether the transferee is fit, willing and able to perform the services

13-21  of a public utility and whether the proposed operation will be consistent

13-22  with the legislative policies set forth in NRS [704.005] 704.001 to 704.751,

13-23  inclusive[.

13-24  6.] , and sections 8 to 18, inclusive, of this act; and

13-25  (d) Whether the transfer will be in the public interest.

13-26  4. The commission may make such amendments, restrictions or

13-27  modifications in a certificate upon transferring it as the public interest

13-28  requires.

13-29  [7.] 5. No transfer is valid beyond the life of the certificate transferred.

13-30  Sec. 26.  NRS 704.430 is hereby amended to read as follows:

13-31  704.430  1.  Any person, firm, association or corporation who [shall

13-32  violate] violates any provisions of NRS 704.330 to [704.410,] 704.430,

13-33  inclusive, and section 7 of this act shall be punished by a fine of not more

13-34  than $250.

13-35  2.  Each day’s operation without a certificate as provided in NRS

13-36  704.330 to [704.410,] 704.430, inclusive, and section 7 of this act or each

13-37  day that service is discontinued, modified or restricted, as defined in

13-38  NRS 704.330 to [704.410, inclusive, shall] 704.430, inclusive, and section

13-39  7 of this act must be considered a separate offense.

13-40  Sec. 27. NRS 704.961 is hereby amended to read as follows:

13-41  704.961  The commission [shall expend up to $500,000] may expend

13-42  money from its reserve account to provide education and informational

13-43  services necessary to educate and inform the residents in this state on

13-44  issues related to the provision of [competitive] utility services in this state.

13-45  The commission [shall] may contract with an independent person to

13-46  provide such educational and informational services.

 

 

 

14-1  Sec. 28. NRS 704.989 is hereby amended to read as follows:

14-2  704.989  1.  The commission shall establish portfolio standards for

14-3  domestic energy that [sets]set forth the minimum percentage of the total

14-4  amount of electricity sold by an electric utility to its retail customers in

14-5  this state during each calendar year that must be derived from renewable

14-6  energy resources. The portfolio standards must:

14-7  (a) [Be] On January 1, 2001, be set at two-tenths of [one] 1 percent of

14-8  the total amount of electricity [annually consumed] sold by the electric

14-9  utility to its retail customers in this state [as of January 1, 2001.

14-10  (b) Be increased biannually thereafter] during the immediately

14-11  preceding calendar year.

14-12  (b) On January 1 of each successive odd-numbered year, be increased

14-13  by two-tenths of [one] 1 percent of the total [annual electric consumption]

14-14  amount of electricity sold by the electric utility to its retail customers in

14-15  this state during the immediately preceding calendar year until the

14-16  [standard reaches] portfolio standards reach a total of 1 percent of the total

14-17  amount of electricity [consumed.] sold by the electric utility to its retail

14-18  customers in this state during the immediately preceding calendar year.

14-19  (c) Be derived from not less than 50 percent renewable energy

14-20  resources.

14-21  (d) Be derived from not less than 50 percent solar renewable energy

14-22  systems.

14-23  (e) Be based on renewable energy credits, if applicable.

14-24  2.  Each [vertically integrated] electric utility [and alternative seller that

14-25  provides electric service in this state] shall comply with the portfolio

14-26  [standard]standards established by the commission pursuant to this

14-27  section. At the end of each calendar year, each [vertically integrated]

14-28  electric utility [and alternative seller] shall submit a report, in a format

14-29  approved by the commission, of the quantity of renewable energy and

14-30  credits, if applicable, that the electric utility [or alternative seller]

14-31  generated, purchased, sold and traded to meet the portfoliostandards . [of

14-32  the portfolio.]

14-33  3.  In establishing the portfolio standardspursuant to this section, the

14-34  commission may establish a system of credits pursuant to whichan electric

14-35  utility [and alternative seller] may comply with the provisions of this

14-36  section. A system of credits must provide that:

14-37  (a) Credits are issued for renewable energy resources for each kilowatt

14-38  hour of energy which it produces; and

14-39  (b) Holders of credits may trade or sell the credits to other parties.

14-40  4.  For the purposes of this section, [a vertically integrated electric

14-41  utility which,]if, on January 1, 1997, [has]at least9 percent of [its

14-42  electricity consumed by]the total amount of electricity sold by an electric

14-43  utility to its retail customers [served by]in this state during the

14-44  immediately preceding calendar year was derived from renewable energy

14-45  resources , the electric utilityshall be deemed to be in compliance until

14-46  January 1, 2005, with the portfolio standards established by the

14-47  commission pursuant to this section. Between January 1, 2005, and

14-48  December 31, 2009, such [a vertically integrated]anelectric utility [and its

14-49  affiliated alternative seller, if any, shall reach a total of]shall have one-half

15-1  of 1 percent of the total amount of electricity [consumed by]sold to its

15-2  retail customers [,]in this state, increased in annual increments of one-

15-3  tenth of 1 percent [, in]during each calendar year of that period, derived

15-4  from solar energy resources for full compliance with the portfolio

15-5  [standard] standardsestablished by the commission pursuant to this

15-6  section.

15-7  5.  [The]In addition to the report required by subsection 2, each

15-8  electric utility [and alternative seller] shall submit a report [to], in a

15-9  format approved bythe commission , that provides information relating to

15-10  the compliance by the [vertically integrated] electric utility [or alternative

15-11  seller] with the requirements of this section. Such reports must be made at

15-12  least annually, unless the commission by regulation determines that such

15-13  reports must be made more frequently than annually, and must include

15-14  clear and concise information that sets forth:

15-15  (a) If the [vertically integrated] electric utility installed a renewable

15-16  energy system during the period for which the report is being made, the

15-17  date of installation;

15-18  (b) The capacity of renewable energy systems of the [vertically

15-19  integrated] electric utility ;[or alternative seller;]

15-20  (c) The amount of production of energy from the renewable energy

15-21  systems;

15-22  (d) The portion of the production of energy that is directly derived from

15-23  renewable energy resources;

15-24  (e) The quantity of energy from renewable energy systems that is

15-25  transmitted or distributed, or both, to retail customers in this state by the

15-26  [vertically integrated] electric utility ;[or alternative seller;] and

15-27  (f) Such other information that the commission by regulation may deem

15-28  relevant.

15-29  6.  [Nothing in this section applies]The provisions of this section do

15-30  not applyto:

15-31  (a) Rural electric cooperatives established pursuant to chapter 81 of

15-32  NRS;

15-33  (b) General improvement districts established pursuant to chapter 318

15-34  of NRS; or

15-35  (c) Utilities established pursuant to chapter 709 or 710 of NRS.

15-36  7.  As used in this section:

15-37  (a) “Electric utility” has the meaning ascribed to it in section 19 of

15-38  this act.

15-39  (b) “Renewable energy resources” means wind, solar, geothermal and

15-40  biomass energy resources [in this state] that are naturally regenerated.

15-41  [(b)] (c) “Renewable energy system” means an energy system [in this

15-42  state] that utilizes renewable energy resources to produce electricity or

15-43  solar thermal energy systems that reduce the consumption of electricity that

15-44  was installed and commenced operations after July 1, 1997.

15-45  Sec. 29.  NRS 228.360 is hereby amended to read as follows:

15-46  228.360  The consumer’s advocate [may,] :

15-47  1.  Shall intervene in and represent the public interest in all

15-48  proceedings conducted pursuant to sections 8 to 18, inclusive, of this act.

16-1  2.  May, with respect to all public utilities except railroads and

16-2  cooperative utilities, and except as provided in NRS 228.380:

16-3  [1.] (a) Conduct or contract for studies, surveys, research or expert

16-4  testimony relating to matters affecting the public interest or the interests of

16-5  utility customers.

16-6  [2.] (b) Examine any books, accounts, minutes, records or other papers

16-7  or property of any public utility subject to the regulatory authority of the

16-8  public utilities commission of Nevada in the same manner and to the same

16-9  extent as authorized by law for members of the public utilities commission

16-10  of Nevada and its staff.

16-11  [3.  Petition]

16-12  (c) Except as otherwise provided in subsection 1, petition for, request,

16-13  initiate, appear or intervene in any proceeding concerning rates, charges,

16-14  tariffs, modifications of service or any related matter before the public

16-15  utilities commission of Nevada or any court, regulatory body, board,

16-16  commission or agency having jurisdiction over any matter which the

16-17  consumer’s advocate may bring before or has brought before the public

16-18  utilities commission of Nevada or in which the public interest or the

16-19  interests of any particular class of utility customers are involved. The

16-20  consumer’s advocate may represent the public interest or the interests of

16-21  any particular class of utility customers in any such proceeding, and he is a

16-22  real party in interest in the proceeding.

16-23  Sec. 30.  NRS 228.390 is hereby amended to read as follows:

16-24  228.390  Except as otherwise provided in sections 8 to 18, inclusive,

16-25  of this act:

16-26  1.  The consumer’s advocate has sole discretion to represent or refrain

16-27  from representing the public interest and any class of customers in any

16-28  proceeding.

16-29  2.  In exercising his discretion, the consumer’s advocate shall consider

16-30  the importance and extent of the public interest or the customers’ interests

16-31  involved and whether those interests would be adequately represented

16-32  without his participation.

16-33  3.  If the consumer’s advocate determines that there would be a conflict

16-34  between the public interest and any particular class of customers or any

16-35  inconsistent interests among the classes of customers involved in a

16-36  particular matter, he may choose to represent one of the interests, to

16-37  represent no interest, or to represent one interest through his office and

16-38  another or others through outside counsel engaged on a case basis.

16-39  Sec. 31. NRS 538.181 is hereby amended to read as follows:

16-40  538.181  1.  The commission shall hold and administer all rights and

16-41  benefits pertaining to the distribution of the power and water mentioned in

16-42  NRS 538.041 to 538.251, inclusive, for the State of Nevada[,] and, except

16-43  as otherwise provided in NRS 538.186, may enter into contracts relating to

16-44  that power and water, including the transmission and other distribution

16-45  services, on such terms as the commission determines.

16-46  2.  Every applicant, except a federal or state agency or political

16-47  subdivision, for power or water to be used within the State of Nevada must,

16-48  before the application is approved, provide an indemnifying bond by a

16-49  corporation qualified pursuant to the laws of this state, or other collateral,

17-1  approved by the state board of examiners, payable to the State of Nevada in

17-2  such sum and in such manner as the commission may require, conditioned

17-3  for the full and faithful performance of the lease, sublease, contract or other

17-4  agreement.

17-5  3.  The power and water must not be sold for less than the actual cost to

17-6  the State of Nevada.

17-7  4.  Except as otherwise provided in subsection 5, before any such sale

17-8  or lease is made, a notice of it must be advertised in two papers of general

17-9  circulation published in the State of Nevada at least once a week for 2

17-10  weeks. The commission shall require any person desiring to make

17-11  objection thereto to file the objection with the commission within 10 days

17-12  after the date of the last publication of the notice. If any objection is filed,

17-13  the commission shall set a time and place for a hearing of the objection not

17-14  more than 30 days after the date of the last publication of the notice.

17-15  5.  The provisions of subsection 4 do not apply to:

17-16  (a) Any contract by the commission to sell supplemental power to a

17-17  holder of a long-term firm contract with the state for power if the

17-18  supplemental power is procured by the commission from a prearranged

17-19  source and is secured by the holder for his own use; or

17-20  (b) Any agreement by the commission to sell short-term or interruptible

17-21  power on short notice for immediate acceptance to a holder of a long-term

17-22  firm contract with the state for power who can take delivery of the short-

17-23  term or interruptible power when it is available.

17-24  6.  Except as otherwise provided in subsection 2 of NRS 538.251, any

17-25  such lease, sublease, contract or sale of the water or power is not binding

17-26  upon the State of Nevada until ratified and approved by the governor and,

17-27  where required by federal law, until approved by the United States.

17-28  7.  The commission shall, upon the expiration of a contract for the sale

17-29  of power which is in effect on July 1, 1993, offer to the purchaser the right

17-30  to renew the contract. If the commission is unable to supply the amount of

17-31  power set forth in the contract because of a shortage of power available for

17-32  sale, it shall reduce, on a pro rata basis, the amount of power it is required

17-33  to sell pursuant to the renewed contract.

17-34  8.  [Except as otherwise provided in NRS 704.987, notwithstanding]

17-35  Notwithstanding any provision of chapter 704 of NRS, any purchase of:

17-36  (a) Power or water for distribution or exchange, and any subsequent

17-37  distribution or exchange of power or water by the commission; or

17-38  (b) Water for distribution or exchange, and any subsequent distribution

17-39  or exchange of water by any entity to which or with which the commission

17-40  has contracted the water,

17-41  is not subject to regulation by the public utilities commission of Nevada.

17-42  Sec. 32. 1.  NRS 704.965, 704.966, 704.967, 704.968, 704.969,

17-43  704.970, 704.971, 704.972, 704.973, 704.974, 704.975, 704.976, 704.977,

17-44  704.978, 704.979, 704.980, 704.981, 704.982, 704.9823, 704.9826,

17-45  704.9829, 704.983, 704.984, 704.985, 704.986, 704.9865, 704.987,

17-46  704.988 and 704.990 are hereby repealed.

17-47  2.  Sections 335 and 337 of chapter 482, Statutes of Nevada 1997, at

17-48  pages 2021 and 2022, respectively, and sections 17, 21, 22, 24 and 26 of

18-1  chapter 600, Statutes of Nevada 1999, at pages 3269 and 3272, are hereby

18-2  repealed.

18-3  3.  Section 127 of Senate Bill No. 29 of this session is hereby repealed.

18-4  Sec. 33.  The public utilities commission of Nevada shall:

18-5  1.  Amend, modify, supplement, annul or vacate any order or directive

18-6  issued by the commission before the effective date of this act that

18-7  authorizes or requires an electric utility to dispose of any generation asset,

18-8  if such disposal would violate the provisions of this act;

18-9  2.  Take all appropriate action to request that the Federal Energy

18-10  Regulatory Commission and any other officer, agency or department of the

18-11  Federal Government:

18-12  (a) Not issue any order or directive that authorizes or requires an

18-13  electric utility to dispose of any generation asset, if such an order or

18-14  directive could be interpreted as being in conflict with or preempting the

18-15  provisions of this act; and

18-16  (b) Amend, modify, supplement, annul or vacate any order or directive

18-17  issued before, on or after the effective date of this act that authorizes or

18-18  requires an electric utility to dispose of any generation asset, if such an

18-19  order or directive could be interpreted as being in conflict with or

18-20  preempting the provisions of this act;

18-21  3.  If any action taken pursuant to subsection 2 is unsuccessful, take all

18-22  appropriate legal action to challenge any order or directive issued by the

18-23  Federal Energy Regulatory Commission or any other officer, agency or

18-24  department of the Federal Government that authorizes or requires an

18-25  electric utility to dispose of any generation asset, if such an order or

18-26  directive could be interpreted as being in conflict with or preempting the

18-27  provisions of this act; and

18-28  4.  Take any other action or issue any other orders necessary to carry

18-29  out the provisions of this act.

18-30  Sec. 34. As used in this section and sections 35 and 36 of this act,

18-31  unless the context otherwise requires:

18-32  1.  “Affiliate” means an entity that, directly or indirectly through one or

18-33  more intermediaries, controls, is controlled by or is under common control

18-34  with another entity.

18-35  2.  “Commission” means the public utilities commission of Nevada.

18-36  3.  “Comprehensive energy plan” means the application to adopt a

18-37  comprehensive energy plan, designated in the records of the commission as

18-38  Docket No. 01-1045, and all amendments and modifications to the

18-39  application or the plan.

18-40  4.  “Deferred account” means any account that is used to carry out

18-41  deferred accounting pursuant to section 19 of this act.

18-42  5.  “Electric utility” has the meaning ascribed to it in section 19 of

18-43  this act.

18-44  6.  “Electric utility holding company” means:

18-45  (a) An entity which is incorporated or organized under the laws of this

18-46  state and which holds a controlling interest in an electric utility; and

18-47  (b) A successor in interest to any entity described in paragraph (a).

18-48  7.  “Electric utility that primarily serves densely populated counties”

18-49  means an electric utility that, with regard to the provision of electric

19-1  service, derives more of its annual gross operating revenue in this state

19-2  from customers located in counties whose population is 400,000 or more

19-3  than it does from customers located in counties whose population is less

19-4  than 400,000.

19-5  8.  “Electric utility that primarily serves less densely populated

19-6  counties” means an electric utility that, with regard to the provision of

19-7  electric service, derives more of its annual gross operating revenue in this

19-8  state from customers located in counties whose population is less than

19-9  400,000 than it does from customers located in counties whose population

19-10  is 400,000 or more.

19-11  Sec. 35. Except as otherwise provided in section 36 of this act and

19-12  notwithstanding the provisions of any other specific statute to the contrary:

19-13  1.  An electric utility shall not file an application for a fuel and

19-14  purchased power rider on or after the effective date of this act.

19-15  2.  Each application for a fuel and purchased power rider filed by an

19-16  electric utility which is pending with the commission on the effective date

19-17  of this act and which the electric utility did not place into effect before or

19-18  on April 1, 2001, is void and unenforceable and is not valid for any

19-19  purpose after April 1, 2001.

19-20  3.  If, before March 1, 2001, an electric utility incurred any costs for

19-21  fuel or purchased power, including, without limitation, any costs for fuel or

19-22  purchased power recorded or carried on the books and records of the

19-23  electric utility, and those costs were not recovered or could not be

19-24  recovered pursuant to a fuel and purchased power rider placed into effect

19-25  by the electric utility before March 1, 2001, the electric utility is not

19-26  entitled, on or after March 1, 2001, to recover any of those costs for fuel or

19-27  purchased power from customers, and the commission shall not allow the

19-28  electric utility to recover any of those costs for fuel or purchased power

19-29  from customers.

19-30  4.  Except as otherwise provided in this section, on and after the

19-31  effective date of this act:

19-32  (a) The commission shall not take any further action on the

19-33  comprehensive energy plan, and each electric utility that jointly filed the

19-34  comprehensive energy plan shall be deemed to have withdrawn the

19-35  comprehensive energy plan;

19-36  (b) The rates that each electric utility placed into effect on March 1,

19-37  2001, pursuant to the comprehensive energy plan shall be deemed to be a

19-38  component of the electric utility’s rates for fuel and purchased power; and

19-39  (c) The revenues collected by each electric utility before April 1, 2001,

19-40  from the rates that each electric utility placed into effect on March 1, 2001,

19-41  pursuant to the comprehensive energy plan shall be deemed to be a credit

19-42  in the electric utility’s deferred accounts.

19-43  5.  On or before October 1, 2001, each electric utility that primarily

19-44  serves densely populated counties shall file a general rate application

19-45  pursuant to subsection 3 of NRS 704.110, as amended by this act. On or

19-46  before December 1, 2001, each electric utility that primarily serves densely

19-47  populated counties shall file an application to clear its deferred accounts

19-48  pursuant to subsection 7 of NRS 704.110, as amended by this act. After

19-49  such an electric utility files the application to clear its deferred accounts,

20-1  the commission shall investigate and determine whether the rates that the

20-2  electric utility placed into effect on March 1, 2001, pursuant to the

20-3  comprehensive energy plan are just and reasonable and reflect prudent

20-4  business practices. On the date on which the commission issues a final

20-5  order on the general rate application, the commission shall issue a final

20-6  order on the electric utility’s application to clear its deferred accounts. The

20-7  total rates to provide electric service that were in effect on April 1, 2001,

20-8  for the electric utility must remain in effect until the date on which the

20-9  commission issues a final order on the general rate application. The

20-10  commission shall not adjust the rates of the electric utility during this

20-11  period unless such an adjustment is absolutely necessary to avoid rates that

20-12  are confiscatory under the Constitution of the United States or the

20-13  constitution of this state. The commission:

20-14  (a) May make such an adjustment only to the extent that it is absolutely

20-15  necessary to avoid an unconstitutional result; and

20-16  (b) Shall not, in any proceedings concerning such an adjustment,

20-17  approve any rate or grant any relief that is not absolutely necessary to

20-18  avoid an unconstitutional result.

20-19  After the electric utility files the general rate application that is required by

20-20  this subsection, the electric utility shall file general rate applications in

20-21  accordance with subsection 3 of NRS 704.110, as amended by this act.

20-22  After the electric utility files the application to clear its deferred accounts

20-23  that is required by this subsection, the electric utility shall file applications

20-24  to clear its deferred accounts in accordance with section 19 of this act and

20-25  subsection 7 of NRS 704.110, as amended by this act.

20-26  6.  On or before December 1, 2001, each electric utility that primarily

20-27  serves less densely populated counties shall file a general rate application

20-28  pursuant to subsection 3 of NRS 704.110, as amended by this act. On or

20-29  before February 1, 2002, each electric utility that primarily serves less

20-30  densely populated counties shall file an application to clear its deferred

20-31  accounts pursuant to subsection 7 of NRS 704.110, as amended by this act.

20-32  After such an electric utility files the application to clear its deferred

20-33  accounts, the commission shall investigate and determine whether the rates

20-34  that the electric utility placed into effect on March 1, 2001, pursuant to the

20-35  comprehensive energy plan are just and reasonable and reflect prudent

20-36  business practices. On the date on which the commission issues a final

20-37  order on the general rate application, the commission shall issue a final

20-38  order on the electric utility’s application to clear its deferred accounts. The

20-39  total rates to provide electric service that were in effect on April 1, 2001,

20-40  for the electric utility must remain in effect until the date on which the

20-41  commission issues a final order on the general rate application. The

20-42  commission shall not adjust the rates of the electric utility during this

20-43  period unless such an adjustment is absolutely necessary to avoid rates that

20-44  are confiscatory under the Constitution of the United States or the

20-45  constitution of this state. The commission:

20-46  (a) May make such an adjustment only to the extent that it is absolutely

20-47  necessary to avoid an unconstitutional result; and

21-1  (b) Shall not, in any proceedings concerning such an adjustment,

21-2  approve any rate or grant any relief that is not absolutely necessary to

21-3  avoid an unconstitutional result.

21-4  After the electric utility files the general rate application that is required by

21-5  this subsection, the electric utility shall file general rate applications in

21-6  accordance with subsection 3 of NRS 704.110, as amended by this act.

21-7  After the electric utility files the application to clear its deferred accounts

21-8  that is required by this subsection, the electric utility shall file applications

21-9  to clear its deferred accounts in accordance with section 19 of this act and

21-10  subsection 7 of NRS 704.110, as amended by this act.

21-11  Sec. 36. Notwithstanding the provisions of any other specific statute

21-12  to the contrary:

21-13  1.  If, on or after January 1, 1999, and before the effective date of this

21-14  act, an electric utility holding company entered into any transaction to

21-15  acquire a controlling interest in a public utility that provides electric

21-16  service primarily to customers located outside of this state, the electric

21-17  utility holding company shall not carry out the transaction unless, on or

21-18  after the effective date of this act:

21-19  (a) The electric utility holding company files with the commission an

21-20  application for authorization of the transaction; and

21-21  (b) The commission issues a written order that authorizes the

21-22  transaction. The commission shall not authorize the transaction unless the

21-23  commission finds that the transaction will be in the public interest. The

21-24  commission may base its authorization of the transaction upon such terms,

21-25  conditions or modifications as the commission deems appropriate.

21-26  2.  If the commission authorizes a transaction described in subsection 1

21-27  and, before July 1, 2003, the electric utility holding company acquires a

21-28  controlling interest in such a public utility, or any affiliate thereof, pursuant

21-29  to the transaction:

21-30  (a) Each electric utility in which the electric utility holding company

21-31  holds a controlling interest shall not use deferred accounting pursuant to

21-32  section 19 of this act on or after the date on which the electric utility

21-33  holding company acquires a controlling interest in the public utility, or any

21-34  affiliate thereof;

21-35  (b) Not later than 90 days after that date, each such electric utility shall

21-36  file one final application to clear the remaining balance in its deferred

21-37  accounts pursuant to subsection 7 of NRS 704.110, as amended by this act;

21-38  (c) For each such electric utility, the commission shall not carry out the

21-39  provisions of section 35 of this act concerning deferred accounting and

21-40  deferred accounts; and

21-41  (d) The commission shall carry out the remaining provisions of section

21-42  35 of this act, including, without limitation, the commission’s investigation

21-43  and determination whether the rates that each electric utility placed into

21-44  effect on March 1, 2001, pursuant to the comprehensive energy plan are

21-45  just and reasonable and reflect prudent business practices.

21-46  3.  Any transaction that violates the provisions of this section is void

21-47  and unenforceable and is not valid for any purpose.

21-48  Sec. 37. Any license issued to an alternative seller pursuant to NRS

21-49  704.977 is void on and after the effective date of this act.

22-1  Sec. 38. 1.  The provisions of this act are hereby declared to be

22-2  severable.

22-3  2.  If any provision of this act is held invalid, or if the application of

22-4  any such provision to any person, thing or circumstance is held invalid,

22-5  such invalidity does not affect any other provision of this act that can be

22-6  given effect without the invalid provision or application.

22-7  Sec. 39. This act becomes effective upon passage and approval.

 

22-8  LEADLINES OF REPEALED SECTIONS

 

22-9    704.965  Definitions.

22-10  704.966  “Aggregation service” defined.

22-11  704.967  “Alternative seller” defined.

22-12  704.968  “Customer” defined.

22-13  704.969  “Effective competition” defined.

22-14  704.970  “Electric distribution utility” defined.

22-15  704.971  “Electric service” defined.

22-16  704.972  “Generation service” defined.

22-17  704.973  “Noncompetitive service” defined.

22-18  704.974  “Potentially competitive service” defined.

22-19  704.975  “Vertically integrated electric utility” defined.

22-20  704.976  Date upon which customers may begin obtaining

22-21  potentially competitive services from alternative sellers; exception;

22-22  commission authorized to establish different dates for provision of

22-23  different services; determination of potentially competitive service;

22-24  determination of prices under certain circumstances; regulations; date

22-25  upon which potentially competitive electric service deemed

22-26  competitive; reconsideration of determinations; date upon which

22-27  vertically integrated electric utility is required to provide potentially

22-28  competitive service through affiliate.

22-29  704.977  Licensing of alternative sellers: Requirements;

22-30  regulations; provision of aggregation service.

22-31  704.978  Provision of potentially competitive service by provider of

22-32  noncompetitive service prohibited; exception; certain facilities or

22-33  services of provider of noncompetitive service to be made available to

22-34  alternative sellers on equal and nondiscriminatory basis; use of name

22-35  or logo by affiliate.

22-36  704.979  Markets for electric services: Monitoring by commission;

22-37  investigations; regulations; transmission of evidence of anticompetitive

22-38  or discriminatory conduct to attorney general or appropriate federal

22-39  agency; alternative sellers and affiliates not exempt from other

22-40  applicable statutes; person aggrieved by conduct of alternative seller

22-41  not required to seek relief first from commission.

22-42  704.980  Provision of potentially competitive service by affiliate of

22-43  provider of noncompetitive service: Requirements; regulations;

23-1  provider of noncompetitive service and affiliate subject to applicable

23-2  statutes relating to consumer and antitrust protections.

23-3    704.981  Noncompetitive service: Requirements; regulations.

23-4    704.982  Designation of vertically integrated electric utility or its

23-5  successor electric distribution utility for certain customers; obligation

23-6  to serve; rate to be charged; alternate methods for providing electric

23-7  service; reacquisition of service from designated provider; limitation

23-8  on commission adjusting rates, earnings, rate base or rate of return of

23-9  designated provider.

23-10  704.9823  Commission to establish total rate for components of

23-11  electric service for each class of customers of electric service;

23-12  modification of rates; reduction of total rate; inapplicability of total

23-13  rates to customer of alternative seller.

23-14  704.9826  Authority of designated provider of electric service to

23-15  recover shortfall.

23-16  704.9829  Authority of licensed alternative seller to take over part

23-17  of service provided by designated vertically integrated electric utility;

23-18  offer; auction; bidding; review of bids.

23-19  704.983  Recoverable costs of vertically integrated electric utilities

23-20  and successor electric distribution utilities; procedure adopted by

23-21  commission for recovery from ratepayers; commission required to

23-22  consider minimization of certain federal taxes in determining

23-23  recoverable costs.

23-24  704.984  Adverse effects of competitive service on employees of

23-25  vertically integrated electric utilities; certain costs related to employees

23-26  to be considered in determining recoverable costs.

23-27  704.985  Change in alternative sellers: Procedure; standards;

23-28  educational program.

23-29  704.986  Vertically integrated electric utility to submit plan for

23-30  compliance to commission; commission authorized to exempt

23-31  vertically integrated electric utility or alternative seller from strict

23-32  application of certain provisions of chapter.

23-33  704.9865  Vertically integrated electric utility in existence on

23-34  January 1, 1999, to comply with existing obligations for purchase of

23-35  power; recovery of costs.

23-36  704.987  Colorado River commission: Sale of electricity; provision

23-37  of transmission or distribution service.

23-38  704.988  Availability of electric service: Forecasts of electric

23-39  capacity and energy; establishment of equitable obligations to ensure

23-40  sufficient capacity is available; submission of information to

23-41  commission.

23-42  704.990  Commission to prepare for legislature quarterly report

23-43  assessing developments in electric industry.

 

24-1  TEXT OF REPEALED SECTIONS

 

24-2    Section 335 of chapter 482, Statutes of Nevada 1997:

24-3  Sec. 335.  The executive director of the department of taxation

24-4  shall, not later than January 1, 1999, submit to the director of the

24-5  legislative counsel bureau for distribution to the legislature a report

24-6  including, but not limited to:

24-7  1.  An analysis of the effect of the tax policies of this state on:

24-8  (a) The potential for effective competition in providing electric

24-9  services to customers; and

24-10  (b) The effect of competition in providing electric services to

24-11  customers on the revenue from taxes and franchise fees of this state

24-12  and local governments.

24-13  2.  Recommendations for legislation that would advance the

24-14  purposes of sections 28 to 53, inclusive, of this act and ensure a

24-15  minimal effect on the tax revenue of this state and local governments.

24-16  Section 337 of chapter 482, Statutes of Nevada 1997:

24-17  Sec. 337.  The public service commission of Nevada shall adopt

24-18  regulations to carry out the provisions of sections 28 to 53, inclusive,

24-19  of this act not later than July 1, 1999.

24-20  Section 17 of chapter 600, Statutes of Nevada 1999:

24-21  Sec. 17.  NRS 704.982 is hereby amended to read as follows:

24-22  704.982 1.  The commission shall designate [a vertically

24-23  integrated electric utility or its successor] an electric distribution

24-24  utility to provide electric service to customers who are unable to

24-25  obtain electric service from an alternative seller or who fail to select

24-26  an alternative seller. The provider so designated by the commission is

24-27  obligated to provide electric service to the customers. Electric service

24-28  provided by the utility pursuant to this section shall be deemed to be a

24-29  noncompetitive service for which the utility may recover its costs

24-30  pursuant to NRS 704.001 to 704.655, inclusive, 704.701 to 704.751,

24-31  inclusive, and 704.800 to 704.900, inclusive.

24-32  2.  [The rate that the designated provider of electric service must

24-33  charge a customer for the provision of electric service pursuant to

24-34  subsection 1 is the total rate established for that class of customer by

24-35  the commission pursuant to section 4 of this act.

24-36  3.] Upon a finding by the commission that the public interest will

24-37  be promoted, the commission may prescribe alternate methods for

24-38  providing electric service to those customers described in subsection

24-39  1. The alternate methods may include, but are not limited to, the direct

24-40  assignment of customers to alternative sellers or other electric

24-41  distribution utilities or a process of competitive bidding for the right

24-42  to provide electric service to the designated customers, including,

24-43  without limitation, an auction conducted pursuant to section 6 of this

25-1  act. [Any alternate methods prescribed by the commission pursuant to

25-2  this subsection may not go into effect before July 1, 2001.

25-3  4.] 3. A customer who has obtained generation, aggregation or

25-4  any other potentially competitive service for at least 30 continuous

25-5  days from an alternative seller [after March 1, 2000, or such other

25-6  date that is determined to be in the public interest by the governor

25-7  pursuant to NRS 704.976,] may reacquire service from the

25-8  designated provider of electric service pursuant to tariffs approved

25-9  by the commission. The commission shall establish minimum terms

25-10  and conditions under which electric service must be provided pursuant

25-11  to this section, including a minimum period during which a customer

25-12  must be obligated to pay for the electric service from the assigned

25-13  provider. The price charged for electric service for a particular group

25-14  of customers must reflect the incremental cost of serving the group.

25-15  [5.] 4. If the designated provider of the electric service pursuant

25-16  to subsection 1is [a vertically integrated] an electric distribution

25-17  utility, the utility shall provide the electric service [on or after July 1,

25-18  2001,] only through an affiliate whose sole business activity is the

25-19  provision of electric service.

25-20  [6.  Except upon the application of the designated provider to

25-21  reduce the total rate for any class of customers pursuant to section 4 of

25-22  this act, the commission shall not initiate or conduct any proceedings

25-23  to adjust the rates, earnings, rate base or rate of return of the

25-24  designated provider of electric service during the period in which the

25-25  provider is providing that service to customers pursuant to this

25-26  section.]

25-27  Section 21 of chapter 600, Statutes of Nevada 1999:

25-28  Sec. 21.  On or before March 1, 2000, or such other date that is

25-29  determined to be in the public interest by the governor pursuant to

25-30  NRS 704.976, the commission shall, for the purposes of NRS

25-31  704.986, establish for each class of customers of electric service in

25-32  this state the rate for each component and a total rate for electric

25-33  services for customers based on the cost to provide electric service to

25-34  each class of customers in this state. The total rate established for each

25-35  class of customers pursuant to this section must be the same as the

25-36  total rate for each class of customers that is in effect on June 1, 1999.

25-37  Section 22 of chapter 600, Statutes of Nevada 1999:

25-38  Sec. 22.  On or before March 1, 2000, or such other date that is

25-39  determined to be in the public interest by the governor pursuant to

25-40  NRS 704.976, an alternative seller and a vertically integrated electric

25-41  utility may negotiate and enter into a contract with a customer for the

25-42  provision of electric service, but no such contract is effective before

25-43  March 1, 2000, or such other date that is determined to be in the

25-44  public interest by the governor pursuant to NRS 704.976.

25-45  Section 24 of chapter 600, Statutes of Nevada 1999:

25-46  Sec. 24.  This act must not be construed to impair any existing

25-47  rights under any labor agreement to which a vertically integrated

25-48  electric utility or its successor electric distribution utility or an

25-49  affiliate thereof is a party on July 1, 1999.

26-1    Section 26 of chapter 600, Statutes of Nevada 1999:

26-2  Sec. 26.  If the pending merger between Sierra Pacific Resources

26-3  and Nevada Power Company, referred to in the records of the Public

26-4  Utilities Commission of Nevada as Docket No. 98-7023, is terminated

26-5  for any reason before the completion of the merger, this act expires by

26-6  limitation on the date on which the pending merger is terminated.

26-7    Section 127 of Senate Bill No. 29 of this session:

26-8    Sec. 127. 1.  Section 25 of chapter 600, Statutes of Nevada

26-9  1999, at page 3272, is hereby amended to read as follows:

26-10  Sec. 25.  1.  This section and sections 1 to 6, inclusive, 9 to

26-11  16, inclusive, 18 [to 22, inclusive,] , 19, 20, 21, 22

 and 26 of this

26-12  act become effective on July 1, 1999.

26-13  2.  Sections 23 and 24 of this act

 become effective upon

26-14  passage and approval.

26-15  3.  Sections 7 and 8 of this act become effective on October 1,

26-16  1999.

26-17  4.  [Sections 4 and 16 expire] Section 4 of this act expires

 by

26-18  limitation on March 1, 2003.

26-19  5.  Section 5 of this act

 expires by limitation on September 1,

26-20  2003.

26-21  6.  [Section 17 becomes] Sections 17 and 20.1 of this act

26-22  become

 effective on March 1, 2003.

26-23  2.  Chapter 600, Statutes of Nevada 1999, at page 3272, is hereby

26-24  amended by adding thereto a new section to be designated as section

26-25  20.1, immediately following section 20, to read as follows:

26-26  Sec. 20.1.  Section 6 of this act is hereby amended to read as

26-27  follows:

26-28     Sec. 6.  1.  At any time after July 1, 2001, a licensed

26-29  alternative seller may submit to the commission an offer to

26-30  provide electric service that is being provided by the provider

26-31  designated pursuant to subsection 1 of NRS 704.982. The offer

26-32  must:

26-33     (a) Request to serve at least 10 percent of the load of the

26-34  provider designated pursuant to subsection 1 of NRS 704.982;

 

26-35  and

26-36     (b) Provide that the service will be provided by the alternative

26-37  seller to more than one class of customers .

 [; and

26-38     (c) Provide that there will be a discount of 5 percent off the

26-39  rate prescribed in subsection 2 of NRS 704.982.]

26-40     2.  Upon the receipt of such an offer, the commission may

26-41  conduct an auction if the commission determines that it is in the

26-42  public interest to conduct such an auction. If the commission

26-43  determines that such an auction is in the public interest, the

26-44  commission shall conduct the auction as soon as practicable. The

26-45  commission shall determine the terms and conditions for

26-46  continued service by the successful bidder at the auction. Any

26-47  licensed alternative seller or affiliate of an electric distribution

26-48  utility may submit a bid. Bidding must be done by sealed bid.

26-49  Each bid must be not less than 10 percent of the load, as

27-1  measured in megawatts or megawatt hours, of the load of the

27-2  provider designated pursuant to subsection 1 of NRS 704.982.

27-3  3.  The commission shall review the bids. If the successful

27-4  bidder is an alternative seller or an affiliate of an electric

27-5  distribution utility other than the electric distribution utility that

27-6  provided the service before the auction, the successful bidder

27-7  becomes the provider of the service for the percentage of the load

27-8  as indicated in its bid. For the remainder of the load that is not

27-9  awarded to a successful bidder, the electric distribution utility

27-10  which provided service to the customers before the auction

27-11  remains the provider of the service, and that service must

27-12  continue to be provided under the same terms and conditions as

27-13  existed for the provision of that service by the electric

27-14  distribution utility immediately before the auction.

 

27-15  H