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NO. 157. AN ACT RELATING TO PARTICULAR PROCEEDINGS OF THE PUBLIC SERVICE BOARD.

(H.705)

It is hereby enacted by the General Assembly of the State of Vermont:

Sec. 1. 30 V.S.A. § 21(a) is amended to read:

(a) The board or the department may allocate the portion of the expense incurred or authorized by it in retaining additional personnel for the particular proceedings authorized in section 20 of this title to the applicant or the public service company or companies involved in those proceedings. The board shall upon petition of an applicant or public service company to which costs are proposed to be allocated, review and determine, after opportunity for hearing, having due regard for the size and complexity of the project, the necessity and reasonableness of such costs, and may amend or revise such allocations. Prior to allocating costs, the board shall make a determination of the purpose and use of the funds to be raised hereunder, identify the recipient of the funds, provide for allocation of costs among companies to be assessed, indicate an estimated duration of the proceedings, and estimate the total costs to be imposed. With the approval of the board, such estimates may be revised as necessary. From time to time during the progress of the work of such additional personnel, the board or department shall render to the company detailed statements showing the amount of money expended or contracted for in the work of such personnel, which statements shall be paid by the applicant or the public service company into the state treasury at such time and in such manner as the board or department may reasonably direct.

Sec. 2. 30 V.S.A. § 107(c) and (e)(1) are amended to read:

(c) If any company acquires such a controlling interest without the prior approval of the public service board, the board may then, after due notice and opportunity for hearing,

(1) approve the acquisition; or

(2) modify any existing certificates or orders authorizing either or both companies to own or operate a public utility business under the provisions of this title; or

(3) revoke any such existing certificates or orders, or revoke any orders approving the articles of association of such companies; or

(4) declare the acquisition null and void, all as necessary to promote the public good.

(e) For the purposes of this section,

(1) "Controlling interest" means ten percent or more of the outstanding voting securities of a company; or such other interest as the public service board determines, upon notice and opportunity for hearing following its own investigation or a petition filed by the department of public service or other interested party, to constitute the means to direct or cause the direction of the management or policies of a company. The presumption that ten percent or more of the outstanding voting securities of a company constitutes a controlling interest may be rebutted by a company under procedures established by the board by rule.

Sec. 3. 30 V.S.A. § 210 is amended to read:

§ 210. ELECTRIC COMPANIES; INTERCONNECTION FACILITIES

The public service board shall have jurisdiction to order electric companies subject to its supervision to build or rebuild electric transmission lines in order to provide adequate interconnection between the transmission systems of the state. The board shall have power to exercise the jurisdiction herein conferred only after due notice to all interested parties and opportunity for hearing and after making findings based upon adequate evidence that the ordered construction:

(1) Is necessary in the interests of consumers of electrical energy;

(2) Is not detrimental to the interests of the investors of the company ordered to build or rebuild;

(3) Will serve the public good.

The board may allocate the cost of building or rebuilding between the companies whose facilities are to be interconnected providing that the findings herein referred to are made as to each company affected by such allocation.

Sec. 4. 30 V.S.A. § 212d(b) is amended to read:

(b) If, pursuant to subsection (a) of this section, the department and a company are unable to negotiate the rates, charges, terms or other conditions of such contracts including the assurance of adequate reliability, either may petition the public service board to establish the rates, terms, charges, or conditions thereunder, or resolve any other related matter, as the board determines to be just and reasonable. The board shall establish rates or charges under this section to compensate or reimburse such company for all costs reasonably and necessarily incurred by it to provide such arrangements. The board shall *[commence]* offer an opportunity for commencing a hearing within 45 days of filing of the petition and shall make either a final decision or, if unable to do so, an interim decision within three months of filing of the petition. If, within three months of filing, the board is unable to reach a final decision on the petition, the board shall direct the company to provide to the department the necessary arrangements, including if necessary or appropriate, backup reliability, and access to facilities to allow the department to distribute the electric energy involved in its proposal on an interim basis under such interim terms and conditions as the board finds to be reasonable pending a final board decision on the petition. The board shall render a final decision on the petition within six months from the date it is filed.

Sec. 5. 30 V.S.A. § 218(a) is amended to read:

(a) When, *[upon]* after opportunity for hearing, the rates, tolls, charges or schedules are found unjust, unreasonable, insufficient or unjustly discriminatory, or are found to be preferential or otherwise in violation of a provision of this chapter, the board may order and substitute therefor such rates, tolls, charges or schedules, and make such changes in any regulations, measurements, practices or acts of such company relating to its service, and may make such order as will compel the furnishing of such adequate service as shall at such hearing be found by it to be just and reasonable. This section shall not be construed to require the same rates, tolls or charges from any company subject to supervision under this chapter for like service in different parts of the state, but the board in determining these questions shall investigate local conditions and its final findings and judgment shall take cognizance thereof.

Sec. 6. 30 V.S.A. § 218a(c) is amended to read:

(c) The public service board, after notice and opportunity for hearing, may approve the proposed contract, or a modified version thereof, if it is just and reasonable, giving due consideration to costs, quality of service and the interests of the deaf, hearing impaired and speech impaired community.

Sec. 7. 30 V.S.A. § 218c(b) is amended to read:

(b) Each regulated electric or gas company shall prepare and implement a least cost integrated plan for the provision of energy services to its Vermont customers. Proposed plans shall be submitted to the department of public service and the public service board. The board, after notice and opportunity for hearing, may approve a company's least cost integrated plan if it determines that the company's plan complies with the requirements of subdivision (a)(1) of this section.

Sec. 8. 30 V.S.A. § 225(a) is amended to read:

(a) Within a time to be fixed by the board, each company subject to the provisions of this chapter shall file with the department, with separate filings to the directors for regulated utility planning and public advocacy, schedules which shall be open to public inspection, showing all rates including joint rates for any service performed or any product furnished by it within the state, and as a part thereof shall file the rules and regulations that in any manner affect the tolls or rates charged or to be charged for any such service or product. Those schedules, or summaries of the schedules approved by the department, shall be published by the company in two newspapers with general circulation in the state within 15 days after such filing. A change shall not thereafter be made in any such schedules, including schedules of joint rates or in any such rules and regulations, except upon *[forty-five]* 45 days notice to the board and to the department of public service, and such notice to parties affected by such schedules as the board shall direct. The board shall consider the department's recommendation and take action pursuant to sections 226 and 227 of this title before the date on which the changed rate is to become effective. All such changes shall be plainly indicated upon existing schedules, or by filing new schedules in lieu thereof *[forty-five]* 45 days prior to the time the same are to take effect. Subject only to temporary increases, rates may not thereafter be raised without strictly complying with the notice and filing requirements set forth in this section. In no event may a company amend, supplement or alter an existing filing or substantially revise the proof in support of such filing in order to increase, decrease or substantiate a pending rate request, unless, upon opportunity for hearing, the company demonstrates that such a change in filing or proof is necessary for the purpose of providing adequate and efficient service. However, upon application of any company subject to the provisions of this chapter, and with the consent of the department of public service, the board may for good cause shown prescribe a shorter time within which such change may be made; but a change which in effect decreases such tolls or rates may be made upon five days' notice to the board and the department of public service and such notice to parties affected as the board shall direct.

Sec. 9. 30 V.S.A. § 226a(e) is amended to read:

(e) If at any time, after notice and opportunity for hearing, the board determines that changes in federal regulatory law, unforeseen and significant economic shifts, or changes in technology have created either extremely severe economic hardships for the company or a condition that is severely detrimental and contrary to the public good, the board shall order the department and the company to renegotiate relevant portions of a contract negotiated under this section, and any renegotiated provisions shall be subject to the board's approval under the procedures of subsection (c) of this section. If at any time the general assembly is concerned that such conditions exist, it may by joint resolution, direct the board to conduct a hearing and make a determination thereon. If the department and the company fail to reach a negotiated agreement within four months of receipt of an order to negotiate from the board, the board shall hold a hearing to determine the appropriate content of the relevant portions of the contract. In such proceedings, the public contract advocate shall represent the interests of the public and the state, and any interested party may intervene. The board shall complete its hearings and render its decision within four months from the date that the department and the company failed to agree under an order to negotiate. If the department and the company agree within 14 days of the board's decision to accept the board's determination of the appropriate content of the contract, the contract shall continue in effect as modified until its termination date. If the department or the company does not accept the board's determination, the contract shall terminate under the terms specified in subsection (f) of this section 30 days after the date of the board's decision.

Sec. 10. 30 V.S.A. § 231(b) is amended to read:

(b) A company subject to the general supervision of the public service board under section 203 of this title may not abandon or curtail any service subject to the jurisdiction of the board or abandon all or any part of its facilities if it would in doing so effect the abandonment, curtailment or impairment of the service, without first obtaining approval of the public service board, after notice and opportunity for hearing, and upon finding by the board that the abandonment or curtailment is consistent with the public interest; provided, however, this section shall not apply to disconnection of service pursuant to valid tariffs or to rules adopted under section 209(b) and (c) of this title.

Sec. 11. 30 V.S.A. § 506 is amended to read:

§ 506. RENEWAL

Certificates with a limited duration may be renewed during or at the end of the period, after *[a]* opportunity for hearing held according to the criteria for the granting of an original certificate in section 504 of this title and after the board has made the finding required by that section. As part of the renewal proceedings, the board shall hold a public hearing in each county served pursuant to the certificates which are the subject of the renewal proceedings.

Sec. 12. 30 V.S.A. § 509(a) is amended to read:

(a) For good cause, after *[a]* opportunity for hearing, the board may amend or revoke any certificate of public good awarded pursuant to *[sections]* section 503 or 504 of this title.

Sec. 13. 30 V.S.A. § 515(a) is amended to read:

(a) No person, corporation, partnership, or unincorporated association shall acquire ownership of greater than *[forty]* 40 percent of the voting securities in a company as defined in section 501(3) of this title subject to the supervision of the public service board without the approval of the board after due notice and opportunity for hearing and a finding on its part that such acquisition will not be contrary to the public good.

Sec. 14. 30 V.S.A. § 2816(a) is amended to read:

(a) Any person who violates any statute, rule, regulation or order of the public service board relating to safety standards or practices applicable to transportation of gas through gas pipeline facilities subject to the jurisdiction of the public service board is subject to a civil penalty of not more than $10,000.00 for each violation for each day that the violation persists. However, the maximum civil penalty shall not exceed $500,000.00 for any related series of violations. The penalty may be imposed by the board after notice to the offending person of the alleged violations and opportunity for hearing.

Sec. 15. 30 V.S.A. § 7002 is amended to read:

§ 7002. PUBLIC UTILITY UNDERGROUND FACILITY DAMAGE

PREVENTION SYSTEM

Each company shall be a member of and participate in a public utility underground facility damage prevention system as designated by the board unless granted an exemption by the board after opportunity for hearing. The system shall operate during regular business hours throughout the year, except Saturdays, Sundays and legal holidays. The system shall receive notices of proposed excavation activities and transmit the notices to member companies whose facilities may be affected. The cost for operation of the system shall be apportioned equitably among member companies.

Sec. 16. 30 V.S.A. § 218(d) is added to read:

(d) The board may permit recovery in a company’s rates of all or a reasonable portion of the company’s expenditures directly related to aesthetic improvements of utility substations, provided that such aesthetic improvements are incidental to other necessary expenditures at or in the vicinity of the substation.

Sec. 17. 30 V.S.A. § 219a is amended to read:

§ 219a. SELF-GENERATION AND NET METERING

(a) As used in this section:

(1) "Customer" means a retail electric consumer who uses a net metering system.

(2) "Net metering" means measuring the difference between the electricity supplied to a customer and the electricity fed back by a net metering system during the customer's billing period, using a single, nondemand meter or such other meter that would otherwise be applicable to the customer's usage but for the use of net metering.

(3) "Net metering system" means a facility for generation of electricity that:

(A) is of no more than 15 kilowatts (AC) capacity, or is a farm system;

(B) operates in parallel with facilities of the electric distribution system;

(C) is intended primarily to offset part or all of the customer's own electricity requirements;

(D) is located on the customer's premises; and

(E) employs a renewable energy source and utilizes a photovoltaic array, wind turbine or fuel cell electrical generating technology, or is a farm system.

(4) "Farm system" means a facility of no more than *[100]* 125 kilowatts (AC) capacity that generates electric energy from the anaerobic digestion of agricultural waste produced by farming, and which is located on *[the]* a farm *[where substantially all of the waste used is produced]*.

* * *

(g)(1) A net metering system using photovoltaic generation shall conform to applicable electrical safety, power quality, and interconnection requirements established by the National Electrical Code, the Institute of Electrical and Electronic Engineers, and Underwriters Laboratories. The customer shall be responsible for installation, testing, accuracy, and maintenance of net metering equipment.

(2) By March 1, 1999 the board shall adopt, by rule or order, electrical safety, power quality, and interconnection requirements for net metering equipment which uses generation technologies other than photovoltaic technology. In developing safety rules, and any amendments to those rules, the board shall solicit input from representatives of utilities and agents representing line workers.

(3) The board may adopt, by rule or order, additional safety, power quality, and interconnection requirements for customers that the board determines are necessary to protect public safety and system reliability.

* * *

(h) Notwithstanding the provisions of this section that define a net metering system as being of no more than 15 kilowatts (AC) capacity, the board may allow net metering for up to five systems per year for customers that produce more than 15 kilowatts (AC) capacity, but do not produce more than 100 kilowatts of power and do not use methane gas.

Sec. 18. EXEMPTION FOR FUEL CELL DEMONSTRATION PROJECT

Until July 1, 2005, the board may allow net metering by systems that employ fuel cells of any capacity, if they are fueled by renewable energy. Until July 1, 2005, the board may allow net metering by systems of no more than 15 kilowatts (AC) capacity that employ fuel cells that are not fueled by renewable energy.

Sec. 19. STUDY OF SMALL BACKUP GENERATION DEVICES

The department of public service, in consultation with Vermont utilities and representatives of line workers and other interested parties, shall conduct a study and, if necessary, make recommendations to improve the safety of small emergency backup generation systems. The department shall report back to the general assembly by January 5, 2001.

Approved: May 29, 2000