SB3766eng 97TH GENERAL ASSEMBLY

  
  
  

 


 
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1    AN ACT concerning public utilities.
 
2    Be it enacted by the People of the State of Illinois,
3represented in the General Assembly:
 
4    Section 5. The Public Utilities Act is amended by changing
5Section 19-145 and by adding Sections 19-150 and 19-155 as
6follows:
 
7    (220 ILCS 5/19-145)
8    Sec. 19-145. Automatic adjustment clause tariff;
9uncollectibles.
10    (a) A gas utility shall be permitted, at its election, to
11recover through an automatic adjustment clause tariff the
12incremental difference between its actual uncollectible amount
13as set forth in Account 904 in the utility's most recent annual
14Form 21 ILCC and the uncollectible amount included in the
15utility's rates for the period reported in such annual Form 21
16ILCC. The Commission may, in a proceeding to review a general
17rate case filed subsequent to the effective date of the tariff
18established under this Section, prospectively switch, from
19using the actual uncollectible amount set forth in Account 904
20to using net write-offs in such tariff, but only if net
21write-offs are also used to determine the utility's
22uncollectible amount in rates. In the event the Commission
23requires such a change, it shall be made effective at the

 

 

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1beginning of the first full calendar year after the new rates
2approved in such proceeding are first placed in effect and an
3adjustment shall be made, if necessary, to ensure the change
4does not result in double-recovery or unrecovered
5uncollectible amounts for any year. For purposes of this
6Section, "uncollectible amount" means the expense set forth in
7Account 904 of the utility's Form 21 ILCC or cost of net
8write-offs as appropriate. In the event the utility's rates
9change during the period of time reported in its most recent
10annual Form 21 ILCC, the uncollectible amount included in the
11utility's rates during such period of time for purposes of this
12Section will be a weighted average, based on revenues earned
13during such period by the utility under each set of rates, of
14the uncollectible amount included in the utility's rates at the
15beginning of such period and at the end of such period. This
16difference may either be a charge or a credit to customers
17depending on whether the uncollectible amount is more or less
18than the uncollectible amount then included in the utility's
19rates.
20    (b) The tariff may be established outside the context of a
21general rate case filing, and shall specify the terms of any
22applicable audit. The Commission shall review and by order
23approve, or approve as modified, the proposed tariff within 180
24days after the date on which it is filed. Charges and credits
25under the tariff shall be allocated to the appropriate customer
26class or classes. In addition, customers who do not purchase

 

 

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1their gas supply from a gas utility and whose receivables are
2not included in a purchase of receivable program under Section
319-150 shall not be charged by the utility for uncollectible
4amounts associated with gas supply provided by the utility to
5the utility's customers. Upon approval of the tariff, the
6utility shall, based on the 2008 Form 21 ILCC, apply the
7appropriate credit or charge based on the full year 2008
8amounts for the remainder of the 2010 calendar year. Starting
9with the 2009 Form 21 ILCC reporting period and each subsequent
10period, the utility shall apply the appropriate credit or
11charge over a 12-month period beginning with the June billing
12period and ending with the May billing period, with the first
13such billing period beginning June 2010.
14    (c) The approved tariff shall provide that the utility
15shall file a petition with the Commission annually, no later
16than August 31st, seeking initiation of an annual review to
17reconcile all amounts collected with the actual uncollectible
18amount in the prior period. As part of its review, the
19Commission shall verify that the utility collects no more and
20no less than its actual uncollectible amount in each applicable
21Form 21 ILCC reporting period. The Commission shall review the
22prudence and reasonableness of the utility's actions to pursue
23minimization and collection of uncollectibles which shall
24include, at a minimum, the 6 enumerated criteria set forth in
25this Section. The Commission shall determine any required
26adjustments and may include suggestions for prospective

 

 

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1changes in current practices. Nothing in this Section or the
2implementing tariffs shall affect or alter the gas utility's
3existing obligation to pursue collection of uncollectibles or
4the gas utility's right to disconnect service. A utility that
5has in effect a tariff authorized by this Section shall pursue
6minimization of and collection of uncollectibles through the
7following activities, including but not limited to:
8        (1) identifying customers with late payments;
9        (2) contacting the customers in an effort to obtain
10    payment;
11        (3) providing delinquent customers with information
12    about possible options, including payment plans and
13    assistance programs;
14        (4) serving disconnection notices;
15        (5) implementing disconnections based on the level of
16    uncollectibles; and
17        (6) pursuing collection activities based on the level
18    of uncollectibles.
19    (d) Nothing in this Section shall be construed to require a
20utility to immediately disconnect service for nonpayment.
21(Source: P.A. 96-33, eff. 7-10-09.)
 
22    (220 ILCS 5/19-150 new)
23    Sec. 19-150. Purchase of receivables.
24    (a) For the purposes of this Section:
25    "Qualifying alternative gas supplier" means an alternative

 

 

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1gas supplier that (i) is certified under Section 19-110 of this
2Act and (ii) includes its charges for gas sales made in a gas
3utility's service area on that gas utility's bill pursuant to
4Section 19-135 of this Act.
5    "Administrative costs" means all of the utility's costs
6incurred in its administration of the purchase of receivables
7program except for the deemed intangible costs.
8    (b) Within 6 months after the effective date of this
9amendatory Act of the 97th General Assembly, a gas utility with
10at least 100,000 customers that offers transportation service
11to residential customers and small commercial customers shall
12file a tariff pursuant to Article IX of this Act that provides
13qualifying alternative gas suppliers with the option to have
14the gas utility purchase their receivables for gas sales that
15are (1) made to residential customers and small commercial
16customers, as those terms are defined in Section 19-105 of this
17Article, and (2) charged on the gas utility's bill.
18    (c) Receivables for gas sales of qualifying alternative gas
19suppliers that are charged on the gas utility's bill shall be
20purchased by the gas utility at a discount rate of 1%. The rate
21shall include 0.5% to be retained by the gas utility for
22recovery of deemed intangible costs, and neither this 0.5%
23portion of the rate, nor the deemed intangible costs, are
24subject to review by the Commission. The remaining 0.5% of the
251% discount rate shall be retained by the gas utility for
26recovery of the gas utility's administrative costs and is

 

 

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1subject to periodic review by the Commission. Any portion of
2the 0.5% intended for recovery of administrative costs that is
3found by the Commission, after notice and hearing, to be in
4excess of just and reasonable costs shall annually, no later
5than August 1, be provided to the Department of Commerce and
6Economic Opportunity for the purpose of paying late payment
7charges and reconnection fees for households at or below 150%
8of the poverty level that have entered into a payment plan
9behind the individual utility service territory that is making
10the payment. The Department of Commerce and Economic
11Opportunity shall spend the entire amount provided before
12August 1 of the following year. To the extent there is a
13surplus, the Department shall have the ability to pay commodity
14arrearage amounts for households at or below 150% of the
15poverty level. Prior to August 1 of each year, the Department
16of Commerce and Economic Opportunity shall provide a report to
17the Commission on the number of households that received funds
18from this payment and for what purpose the payment was made.
19    (d) In making a just and reasonable determination on the
20administrative costs, the Commission shall consider:
21        (1) the gas utility's reasonable start-up costs and
22    administrative costs associated with the gas utility's
23    purchase of receivables;
24        (2) the impact, if used by the gas utility, of an
25    automatic adjustment clause tariff pursuant to Section
26    19-145 of this Act to recover uncollectible expense; and

 

 

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1        (3) whether the gas utility recovers uncollectible
2    expenses from customers of qualifying alternative gas
3    suppliers through any of its existing rates or charges.
4    (e) Reasonable start-up costs and administrative costs
5associated with the gas utility's purchase of receivables shall
6in the first instance be recovered from qualifying alternative
7gas suppliers through the gas utility's discount rate assessed
8by the gas utility on those qualifying alternative gas
9suppliers who have the gas utility purchase their receivables.
10In order to prevent barriers to suppliers' use of a purchase of
11receivables program and ensure full cost recovery for the gas
12utility in a timely manner, a portion of the gas utility's
13reasonable start-up costs, subject to reasonable carrying
14charges as determined by the Commission, may be deferred for
15later recovery from qualifying alternative gas suppliers who
16have the gas utility purchase their receivables through the
17discount rate or a monthly per bill fee, if such deferral is
18deemed to be necessary by the Commission. The gas utility
19retains the rights to (1) impose the same terms on residential
20customers supplied by qualifying alternative gas suppliers
21with respect to credit and collection, including requests for
22deposits, and (2) disconnect the customers, if it does not
23receive payment for its tariffed services or purchased
24receivables, in the same manner that it would be permitted to
25if the customers had purchased gas supply service from the gas
26utility. Any combination gas and electric utility serving more

 

 

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1than 1,000,000 total customers shall be exempt from the
2requirements of this Section unless and until the Commission
3approves a proposed small volume transportation tariff that
4includes consolidated billing and any associated cost recovery
5provisions for an exempt utility. With regard to exempt
6utilities, the Commission may approve a small volume
7transportation tariff including consolidated billing and
8associated cost recovery as part of a general rate increase or
9other tariff filing.
10    (f) The tariff filed pursuant to this Section shall permit
11the gas utility to recover from customers any uncollected
12receivables that may arise as a result of the purchase of
13receivables under this Section. The tariff filed pursuant to
14this Section shall provide for recovery of the prudently
15incurred costs associated with the provision of this service
16pursuant to this Section and may include other just and
17reasonable terms and conditions. Nothing in this Section
18permits the double recovery of uncollectible expenses from
19customers.
20    (g) Amounts collected by the gas utility attributable to
21the 0.5% portion of the discount rate under this Section for
22deemed intangible costs shall not be used by the Commission to
23lower the base rate revenue requirement of the gas utility in
24any subsequent rate case. In order to limit the implications on
25short-term debt of the gas utility, a gas utility may choose to
26delay purchase of unpaid receivables until the bill due date.

 

 

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1Other than for initial implementation of the purchase of
2receivables program, when so choosing, a gas utility shall
3remit payments to the alternative gas suppliers no more than 2
4business days after the due date.
 
5    (220 ILCS 5/19-155 new)
6    Sec. 19-155. Aggregation of natural gas load by
7municipalities and counties.
8    (a) The corporate authorities of a municipality or county
9board of a county may adopt an ordinance under which it may
10aggregate in accordance with this Section residential
11customers and small commercial customer natural gas loads
12located, respectively, within the municipality or the
13unincorporated areas of the county and, for that purpose, may
14solicit bids and enter into service agreements to facilitate
15for those loads the sale and purchase of natural gas and
16related services and equipment.
17    The corporate authorities or county board may also exercise
18such authority jointly with any other municipality or county.
19Two or more municipalities or counties, or a combination of
20both, may initiate a process jointly to authorize aggregation
21by a majority vote of each particular municipality or county as
22required by this Section.
23    If the corporate authorities or the county board seek to
24operate the aggregation program as an opt-out program for
25residential customers and small commercial customers, then

 

 

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1prior to the adoption of an ordinance with respect to
2aggregation of residential customers and small commercial
3customer natural gas loads, the corporate authorities of a
4municipality or the county board of a county shall submit a
5referendum to its residents to determine whether or not the
6aggregation program shall operate as an opt-out program for
7residential customers and small commercial customers.
8    In addition to the notice and conduct requirements of the
9general election law, notice of the referendum shall state
10briefly the purpose of the referendum. The question of whether
11the corporate authorities or the county board shall adopt an
12opt-out aggregation program for residential customers and
13small commercial customers shall be submitted to the electors
14of the municipality or county board at a regular election and
15approved by a majority of the electors voting on the question.
16The corporate authorities or county board must certify to the
17proper election authority, which must submit the question at an
18election in accordance with the Election Code.
19    The election authority must submit the question in
20substantially the following form:
21        "Shall the (municipality or county in which the
22    question is being voted upon) have the authority to arrange
23    for the supply of natural gas for its residential customers
24    and small commercial customers who have not opted out of
25    such program?"
26    The election authority must record the votes as "Yes" or

 

 

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1"No".
2    If a majority of the electors voting on the question vote
3in the affirmative, then the corporate authorities or county
4board may implement an opt-out aggregation program for
5residential customers and small commercial customers.
6    A referendum must pass in each particular municipality or
7county that is engaged in the aggregation program. If the
8referendum fails, then the corporate authorities or county
9board shall operate the aggregation program as an opt-in
10program for residential customers and small commercial
11customers.
12    An ordinance under this Section shall specify whether the
13aggregation shall occur only with the prior consent of each
14person owning, occupying, controlling, or using a natural gas
15load center proposed to be aggregated. Nothing in this Section,
16however, authorizes the aggregation of natural gas loads that
17are served or authorized to be served by a municipality that
18owns and operates its own gas distribution system. No
19aggregation shall take effect unless approved by a majority of
20the members of the corporate authority or county board voting
21upon the ordinance. A governmental aggregator under this
22Section is not a public utility, agent, broker, consultant or
23an alternative retail gas supplier.
24    (b) Upon the applicable requisite authority under this
25Section, the corporate authorities or the county board shall
26develop a plan of operation and governance for the aggregation

 

 

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1program so authorized. Before adopting a plan under this
2Section, the corporate authorities or county board shall hold
3at least 2 public hearings on the plan. Before the first
4hearing, the corporate authorities or county board shall
5publish notice of the hearings once a week for 2 consecutive
6weeks in a newspaper of general circulation in the
7jurisdiction. The notice shall summarize the plan and state the
8date, time, and location of each hearing. Any load aggregation
9plan established pursuant to this Section shall:
10        (1) provide for universal access to all applicable
11    residential customers and equitable treatment of
12    applicable residential customers;
13        (2) describe demand management and energy efficiency
14    services to be provided to each class of customers; and
15        (3) meet any requirements established by law
16    concerning aggregated service offered pursuant to this
17    Section.
18    (c) The process for selecting a natural gas supplier and
19awarding proposed agreements for the purchase of natural gas
20and other related services shall be conducted in the following
21order:
22        (1) First, the corporate authorities or county board
23    may solicit bids for natural gas and other related
24    services.
25        (2) Then, notwithstanding Section 19-115 of this Act
26    and Section 2FFF of the Consumer Fraud and Deceptive

 

 

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1    Business Practices Act, a natural gas utility that provides
2    residential customers and small commercial customers
3    natural gas service in the aggregate area must, upon
4    request of the corporate authorities or the county board in
5    the aggregate area, submit to the requesting party, in an
6    electronic format, those account numbers, names, and
7    addresses of residential customers and small commercial
8    customers in the aggregate area that are reflected in the
9    natural gas utility's records at the time of the request.
10    Any corporate authority or county board receiving customer
11    information from a natural gas utility shall be subject to
12    the limitations on the disclosure of the information
13    described in Section 19-115 of this Act and Section 2FFF of
14    the Consumer Fraud and Deceptive Business Practices Act,
15    and a natural gas utility shall not be held liable for any
16    claims arising out of the provision of information pursuant
17    to this item (2).
18    (d) If the corporate authorities or county board operate
19under an opt-in program for residential customers and small
20commercial customers, then:
21        (1) within 60 days after receiving the bids, the
22    corporate authorities or county board shall allow
23    residential customers and small commercial customers to
24    commit to the terms and conditions of a bid that has been
25    selected by the corporate authorities or county board; and
26        (2) if (A) the corporate authorities or county board

 

 

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1    award proposed agreements for the purchase of natural gas
2    and other related services and (B) an agreement is reached
3    between the corporate authorities or county board for those
4    services, then residential customers and small commercial
5    customers committed to the terms and conditions according
6    to item (1) of this subsection (d) shall be committed to
7    the agreement.
8    (e) If the corporate authorities or county board operate as
9an opt-out program for residential customers and small
10commercial customers, then it shall be the duty of the
11aggregated entity to fully inform residential customers and
12small commercial customers in advance that they have the right
13to opt out of the aggregation program. The disclosure shall
14prominently state all charges to be made and shall include full
15disclosure of the cost to obtain service pursuant to Section
1619-115 of this Act, how to access it, and the fact that it is
17available to them without penalty, if they are currently
18receiving service under that Section. Early termination fees,
19subject to paragraph (5) of subsection (g) of Section 19-115 of
20this Act, for consumers currently under contract with an
21alternative retail gas supplier or an entity that provides
22services in competition with and similar to an alternative
23retail gas supplier, are not considered penalties under this
24subsection.
25    (f) The Illinois Commerce Commission shall adopt rules to
26implement this Section, including, but not limited to, the

 

 

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1protection of customers already under contract with an
2alternative retail gas supplier, gas utility processes for
3enrollment of opt-out customers, and minimum opt-out
4disclosure requirements for opt-out aggregation. The rules
5adopted under this subsection (f) shall specifically state that
6if a customer is currently under contract with an alternative
7retail gas supplier or an entity that provides services in
8competition with and similar to an alternative retail gas
9supplier, the customer shall not be automatically enrolled in
10the relevant municipal or county opt-out program and that the
11opt-out program shall not interfere with the existing agreement
12between the customer and alternative retail gas supplier or an
13entity that provides services in competition with and similar
14to an alternative retail gas supplier. Nothing shall prohibit a
15customer under contract with an alternative retail gas supplier
16or an entity that provides services in competition with and
17similar to an alternative retail gas supplier from explicitly,
18in writing, affirmatively choosing to enter into the local
19municipality's or county's opt-out program. The opt-out
20disclosure rules adopted under this subsection shall, at a
21minimum, disclose the possibility of a contract termination
22fee, subject to the terms of paragraph (5) of subsection (g) of
23Section 19-115 of this Act, for those customers under contract
24with alternative retail gas suppliers or an entity that
25provides services in competition with and similar to an
26alternative retail gas supplier.

 

 

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1    (g) No municipality or county shall implement, in its plan
2of operation and governance, an opt-out program that
3automatically enrolls a customer that is currently under
4contract with an alternative retail gas supplier or an entity
5that provides services in competition with and similar to an
6alternative retail gas supplier into its municipal or county
7opt-out program. A customer that is currently under contract
8with an alternative retail gas supplier or an entity that
9provides services in competition with and similar to an
10alternative retail gas supplier that seeks to enroll in an
11opt-out program shall be required by the municipality or
12county, as applicable, to explicitly, in writing, affirm the
13choice to enter into said opt-out program.
14    (h) Nothing in this Section shall require a natural gas
15public utility without a Commission-approved small volume
16transportation program to accommodate aggregated load
17switching for any natural gas customers.
 
18    Section 99. Effective date. This Act takes effect upon
19becoming law.