CHAPTER 283
DEPARTMENT OF PUBLIC UTILITY CONTROL:
TELEGRAPH, TELEPHONE, ILLUMINATING,
POWER AND WATER COMPANIES

Table of Contents

Sec. 16-243a. Private power producers. Purchase and sale of electricity. Avoided costs. Small renewable power projects. Interconnectivity standards.
Sec. 16-243e. Electric company purchase of electricity generated by municipal resources recovery facilities.
Sec. 16-243h. Credit to residential customers who generate electricity; metering.
Sec. 16-243m. Measures to reduce federally mandated congestion charges.
Sec. 16-243n. Time-of-use, mandatory peak, shoulder, off-peak and seasonal rates. Optional interruptible or load response rates.
Sec. 16-243q. Class III renewable energy portfolio standards.
Sec. 16-243r. Customer-side distributed resources and grid-side distributed resources. Qualifications for applicability of certain provisions.
Sec. 16-243t. Class III credits.
Sec. 16-243u. Plan to build peaking generation.
Sec. 16-243v. Connecticut electric efficiency partner program.
Sec. 16-243w. Advanced metering system plan and deployment.
Sec. 16-244c. Standard offer. Transitional standard offer. Standard service. Alternative transitional standard offer and standard service. Supplier of last resort. Back-up generation service. Participating electric suppliers.
Sec. 16-244e. Unbundling by electric companies of generation functions from transmission and distribution functions. Plan.
Sec. 16-245a. Renewable energy portfolio standards.
Sec. 16-245e. Stranded costs of electric companies. Definitions. Calculation by department, procedures, adjustments. Mitigation. Defeasance or purchase of rate reduction bonds.
Sec. 16-245l. Systems benefits charge. Determination by department of amount and how applied to customers.
Sec. 16-245m. Conservation and load management program; charge assessed against electric customers to fund program; scope and purpose of program. Deposit of certain moneys from the Energy Conservation and Load Management Funds in General Fund.
Sec. 16-245n. Renewable Energy Investment Fund created; charge assessed against electric customers to fund Investment Fund; purpose.
Sec. 16-245aa. Municipal renewable energy and efficient energy generation grant program.
Sec. 16-245bb. Bond authorization.
Sec. 16-245cc. Demand charge waiver for fuel cells.
Sec. 16-245dd. Residential electric space heating tariff.
Sec. 16-246g. Pilot program for electric generation.
Sec. 16-247l. Access by certified telecommunications providers to occupied buildings: Service, wiring, compensation, regulations, civil penalty.
Sec. 16-256g. Proceeding to determine monthly subscriber fee. Assessment of subscribers for Enhanced 9-1-1 Telecommunications Fund.
Sec. 16-258c. Dual-fuel capability requirements for electric generating facilities.
Sec. 16-262c. Termination of utility service for nonpayment, when prohibited. Amortization agreements. Moneys allowed to be deducted from customers' accounts and moneys to be included in rates as an operating expense. Hardship cases. Notice. Regulations. Annual reports. Privacy of individual customer utility usage and billing information.
Sec. 16-262f. Action for receivership of rents and common expenses by electric, electric distribution, gas and telephone companies; petition; hearing; appointment; duties; termination.
Sec. 16-262m. Construction specifications for water companies.
Sec. 16-262v. Water company infrastructure projects: Definitions.
Sec. 16-262w. Water company rate adjustment mechanisms.

      Sec. 16-243a. Private power producers. Purchase and sale of electricity. Avoided costs. Small renewable power projects. Interconnectivity standards. (a) As used in this section, "avoided costs" means the incremental costs to an electric public service company, municipal electric energy cooperative organized under chapter 101a or municipal electric utility organized under chapter 101, of electric energy or capacity or both which, but for the purchase from a private power producer, as defined in section 16-243b, such company, cooperative or utility would generate itself or purchase from another source.

      (b) Each electric public service company, municipal electric energy cooperative and municipal electric utility shall: (1) Purchase any electrical energy and capacity made available, directly by a private power producer or indirectly under subdivision (4) of this subsection; (2) sell backup electricity to any private power producer in its service territory; (3) make such interconnections in accordance with the regulations adopted pursuant to subsection (h) of this section necessary to accomplish such purchases and sales; (4) upon approval by the Department of Public Utility Control of an application filed by a willing private power producer, transmit energy or capacity from the private power producer to any other such company, cooperative or utility or to another facility operated by the private power producer; and (5) offer to operate in parallel with a private power producer. In making a decision on an application filed under subdivision (4) of this subsection, the department shall consider whether such transmission would (A) adversely impact the customers of the company, cooperative or utility which would transmit energy or capacity to the private power producer, (B) result in an uncompensated loss for, or unduly burden, such company, cooperative, utility or private power producer, (C) impair the reliability of service of such company, cooperative or utility, or (D) impair the ability of the company, cooperative or utility to provide adequate service to its customers. The department shall issue a decision on such an application not later than one hundred twenty days after the application is filed, provided, the department may, before the end of such period and upon notifying all parties and intervenors to the proceeding, extend the period by thirty days. If the department does not issue a decision within one hundred twenty days after receiving such an application, or within one hundred fifty days if the department extends the period in accordance with the provisions of this subsection, the application shall be deemed to have been approved. The requirements under subdivisions (3), (4) and (5) of this subsection shall be subject to reasonable standards for operating safety and reliability and the nondiscriminatory assessment of costs against private power producers, approved by the Department of Public Utility Control with respect to electric public service companies or determined by municipal electric energy cooperatives and municipal electric utilities.

      (c) The Department of Public Utility Control, with respect to electric public service companies, and each municipal electric energy cooperative and municipal electric utility shall establish rates and conditions of service for: (1) The purchase of electrical energy and capacity made available by a private power producer and (2) the sale of backup electricity to a private power producer. The rates for electricity purchased from a private power producer shall be based on the full avoided costs of the electric public service company, municipal electric energy cooperative or municipal electric utility, regardless of whether the purchaser is simultaneously making sales to the private power producer. Payment for energy and capacity purchased from a private power producer by any such company, cooperative or utility shall be pursuant to such rates and conditions or the terms of a contract between the parties. The rates and conditions of service for the purchase of energy and capacity established by the department pursuant to this subsection shall include specific schedules for pricing in long-term contracts for the sale of electricity from small renewable power projects to electric public service companies by private power producers. Such schedules shall not exceed the present worth of the projected avoided costs of the electric public service company over the term of the contract. The department shall apply to a proposed contract filed with the department after January 1, 1992, by a private power producer for a small renewable power project the rates and conditions of service, including the pricing schedule, in effect on the date the private power producer submits its proposed contract to the department, regardless of the subsequent creation of differing schedules or the subsequent amendment of existing schedules.

      (d) When any person, firm or corporation proposes to enter into a contract to sell energy and capacity as a private power producer, an electric public service company, municipal electric energy cooperative or municipal electric utility shall respond promptly to all requests and offers and negotiate in good faith to arrive at a contract which fairly reflects the provisions of this section and the anticipated avoided costs over the life of the contract. Upon application by a private power producer, the department may approve a contract which provides for payment of less than the anticipated avoided costs if, considering all of the provisions, the contract is at least as favorable to the private power producer as a contract providing for the full avoided costs. The contract may extend for a period of not more than thirty years at the option of the private power producer if it has a generating facility with a capacity of at least one hundred kilowatts.

      (e) The department shall consider generating capacity available from cogeneration technology and renewable energy resources in its periodic reviews of electric public service companies and shall require the companies to include the availability of such capacity in applications for rate relief filed in accordance with section 16-19a.

      (f) If a private power producer believes that an electric company has violated any provision of this section it may submit a written petition alleging such violation to the department. Upon receipt of the petition, the department shall fix a time and place for a hearing and mail notice of the hearing to the parties in interest at least one week in advance. Upon the hearing, the department may, if it finds the company has violated any such provision, prescribe the manner in which it shall comply.

      (g) After January 1, 1992, the department shall approve each proposed contract submitted by a private power producer for a small renewable power project, with any modifications agreed to by the parties to the contract, if the filing meets the standards for exemption from the proposal process and for an approvable contract established pursuant to section 16-6b, and is consistent with the pricing schedules adopted pursuant to subsection (c) of this section. Nothing in this section shall preclude a modification of such a contract if the parties to the contract agree to the modification. Any such modification shall be approved by the department. The department shall reconsider each decision issued pursuant to this section between January 1, 1992, and June 29, 1993, regarding such contracts and shall make any modifications to each such decision necessary to ensure that each such decision conforms with the provisions of this section.

      (h) Not later than January 1, 2008, the Department of Public Utility Control shall issue a final decision approving interconnection standards that meet or exceed national standards of interconnectivity. If the department does not issue a final decision by October 1, 2008, each electric distribution company, municipal electric energy cooperative and municipal electric utility shall meet the standards set forth in Title 4, Chapter 4, Subchapter 9, "Net Metering and Interconnection Standards for Class I Renewable Energy Systems" of the New Jersey Administrative Code.

      (P.A. 79-214, S. 2; P.A. 80-167, S. 2; 80-482, S. 4, 40, 345, 348; P.A. 81-439, S. 6, 14; P.A. 82-164; P.A. 85-534, S. 4, 5; P.A. 86-289, S. 2, 5; 86-403, S. 111, 132; P.A. 89-43, S. 1, 2; P.A. 93-299, S. 1, 3; P.A. 07-242, S. 37, 38.)

      History: P.A. 80-167 included municipal electric energy cooperatives under provisions of section; P.A. 80-482 made division of public utility control an independent department and abolished department of business regulation; P.A. 81-439 repealed Subsecs. (a) and (b) and amended and relettered Subsecs. (c) and (d) to make rates and conditions of service applicable to all electricity generated by private power producer, rather than to excess electricity generated by producer of more than one megawatt by cogeneration or use of renewable resources, and to all electricity generated by producer of one megawatt or less by such methods; P.A. 82-164 substantially amended the section, adding provisions concerning avoided costs, interconnections, wheeling, parallel operations, contracting, and petitioning department of public utility control; P.A. 85-534 extended, from 20 to 30 years, the maximum contract period where a private power producer has a generating facility with a capacity of at least 100 kilowatts; P.A. 86-289 made requirement under Subsec. (b)(4) subject to department approval, set forth department considerations and deadlines for such approval proceedings and made technical revisions, effective June 5, 1986, but not applicable to applications filed under the section with the public utility control department before March 1, 1986; P.A. 86-403 changed applicable date in effective date of P.A. 86-289 from March 1 to May 7, 1986; P.A. 89-43 added provision in Subsec. (c) for specific schedules for pricing in long-term contracts; P.A. 93-299 amended Subsec. (c) by adding provision regarding rates and conditions to be applied to proposed contracts for small renewable power projects, deleting reference to producers with a capacity of five megawatts or less and added new Subsec. (g) regarding approval and modification of proposed contracts for small renewable power projects, effective June 29, 1993; P.A. 07-242 amended Subsec. (b)(3) to require interconnections be made in accordance with regulations adopted pursuant to Subsec. (h) and added Subsec. (h) re interconnectivity standards.

      Subsec. (c):

      Department of Public Utility Control's conclusion that word "electricity" as used in this section means renewable energy was reasonable. 283 C. 672.


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      Sec. 16-243e. Electric company purchase of electricity generated by municipal resources recovery facilities. (a) Except as provided in subsection (b) of this section, any electric company, as defined in section 16-1, that, prior to July 6, 2007, purchased electricity generated by a resources recovery facility, as defined in section 22a-260, owned by, or operated by or for the benefit of, a municipality or municipalities, pursuant to a contract with the owner of such facility requiring the electric company to purchase all of the electricity generated at such facility from waste that originated in the franchise area of the electric company, for a period beginning on the date that the facility began generating electricity and having a duration of not less than twenty years, at the same rate that the electric company charges the municipality or municipalities for electricity, shall pay the rate set forth in the contract or, for contracts entered into and approved during calendar year 1999, the rate established by the department, for the remaining period of the contract. No electric company or electric distribution company shall be required to enter into such a contract on or after July 6, 2007.

      (b) Not later than October 1, 2000, and annually thereafter, the department shall calculate the difference between the amount paid by the successor electric distribution company pursuant to each such contract in effect during the preceding fiscal year for electricity generated at the facility from waste that originated within such franchise area and the amount that would have been paid had the company been obligated to pay the rate in effect during calendar year 1999, as determined by the department. The difference, if positive, shall be recovered through the systems benefits charge established under section 16-245l and remitted to the regional resource recovery authority acting on behalf of member municipalities.

      (P.A. 83-529, S. 1; P.A. 85-297, S. 3, 4; P.A. 94-92, S. 1; P.A. 98-28, S. 61, 117; P.A. 07-228, S. 1.)

      History: P.A. 85-297 required electricity to be purchased by contract where previously electric companies were required to compensate municipalities for electricity produced by recovery facilities; P.A. 94-92 required purchase of all electricity generated at such facility from waste which originated in the franchise area of the electric company; P.A. 98-28 designated existing provisions as Subsec. (a) and added new Subsec. (b) re the maintenance of municipal rates at rate in effect during calendar year 1999, effective July 1, 1998; P.A. 07-228 amended Subsec. (a) to establish rates for remainder of contracts entered into prior to July 6, 2007, and make conforming changes and amended Subsec. (b) to delete provision re determination of rates on or before April 1, 2000, effective July 6, 2007.

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      Sec. 16-243h. Credit to residential customers who generate electricity; metering. On and after January 1, 2000, each electric supplier or any electric distribution company providing standard offer, transitional standard offer, standard service or back-up electric generation service, pursuant to section 16-244c, shall give a credit for any electricity generated by a customer from a Class I renewable energy source or a hydropower facility that has a nameplate capacity rating of two megawatts or less. The electric distribution company providing electric distribution services to such a customer shall make such interconnections necessary to accomplish such purpose. An electric distribution company, at the request of any residential customer served by such company and if necessary to implement the provisions of this section, shall provide for the installation of metering equipment that (1) measures electricity consumed by such customer from the facilities of the electric distribution company, (2) deducts from the measurement the amount of electricity produced by the customer and not consumed by the customer, and (3) registers, for each billing period, the net amount of electricity either (A) consumed and produced by the customer, or (B) the net amount of electricity produced by the customer. If, in a given monthly billing period, a customer-generator supplies more electricity to the electric distribution system than the electric distribution company or electric supplier delivers to the customer-generator, the electric distribution company or electric supplier shall credit the customer-generator for the excess by reducing the customer-generator's bill for the next monthly billing period to compensate for the excess electricity from the customer-generator in the previous billing period at a rate of one kilowatt-hour for one kilowatt-hour produced. The electric distribution company or electric supplier shall carry over the credits earned from monthly billing period to monthly billing period, and the credits shall accumulate until the end of the annualized period. At the end of each annualized period, the electric distribution company or electric supplier shall compensate the customer-generator for any excess kilowatt-hours generated, at the avoided cost of wholesale power. A customer who generates electricity from a generating unit with a nameplate capacity of more than ten kilowatts of electricity pursuant to the provisions of this section shall be assessed for the competitive transition assessment, pursuant to section 16-245g and the systems benefits charge, pursuant to section 16-245l, based on the amount of electricity consumed by the customer from the facilities of the electric distribution company without netting any electricity produced by the customer. For purposes of this section, "residential customer" means a customer of a single-family dwelling or multifamily dwelling consisting of two to four units.

      (P.A. 98-28, S. 43, 117; P.A. 03-135, S. 3; P.A. 07-242, S. 39.)

      History: P.A. 98-28 effective July 1, 1998 (Revisor's note: In codifying this section, incorrect references to "section 11 of this act" and "section 16 of this act" were deemed by the Revisors to be references to "section 10" and "section 18" and codified as section 16-245g and section 16-245l, respectively); P.A. 03-135 made technical changes, made the section applicable to electric distribution companies providing standard offer, transitional standard offer, standard service or back-up electric generation service, and added "electricity from a generating unit with a name plate capacity of more than ten kilowatts of", effective July 1, 2003; P.A. 07-242 deleted "residential" and applied provisions to all customers and to facility with nameplate capacity rating of two megawatts or less, and specified that electric distribution company or electric supplier shall credit customer-generator at rate of one kilowatt hour per each kilowatt hour produced, accumulate credits and at the end of each annualized period compensate customer-generator for any excess kilowatt hours.

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      Sec. 16-243m. Measures to reduce federally mandated congestion charges. (a) The Department of Public Utility Control shall, on or before November 1, 2005, identify those measures that can reduce federally mandated congestion charges, as defined in section 16-1, and that can be implemented, in whole or in part, on or before January 1, 2006. Such measures may include, but shall not be limited to, demand response programs, other distributed resources, and contracts between an electric distribution company, as defined in said section 16-1, and an owner of generation resources for the capacity of such resources. The department shall order each electric distribution company to implement, in whole or in part, on or before January 1, 2006, such measures as the department considers appropriate. The company's costs associated with complying with the provisions of this section shall be recoverable through federally mandated congestion charges.

      (b) The department shall conduct a contested case, in accordance with chapter 54, to establish the principles and standards to be used in developing and issuing a request for proposals under this section. The department shall complete such contested case on or before January 1, 2006.

      (c) On or before February 1, 2006, the department shall conduct a proceeding to develop and issue a request for proposals to solicit the development of long-term projects designed to reduce federally mandated congestion charges for the period commencing on May 1, 2006, and ending on December 31, 2010, or such later date specified by the department. For purposes of this section, projects shall include (1) customer-side distributed resources, (2) grid-side distributed resources, (3) new generation facilities, including expanded or repowered generation, and (4) contracts for a term of no more than fifteen years between a person and an electric distribution company for the purchase of electric capacity rights. Such request for proposals shall encourage responses from a variety of resource types and encourage diversity in the fuel mix used in generation. An electric distribution company may submit proposals pursuant to this subsection on the same basis as other respondents to the solicitation. A proposal submitted by an electric distribution company shall include its full projected costs such that any project costs recovered from or defrayed by ratepayers are included in the projected costs. An electric distribution company submitting a bid under this subsection shall demonstrate to the satisfaction of the department that its bid is not supported in any form of cross subsidization by affiliated entities. If such electric distribution company's proposal is approved pursuant to subsection (g) of this section, the costs and revenues of such proposal shall not be included in calculating such company's earning for purposes of, or in determining whether its rates are just and reasonable under, sections 16-19, 16-19a and 16-19e. Electric distribution companies may under no circumstances recover more than the full costs identified in the proposals, as approved under subsection (g) of this section and consistent with subsection (h) of this section. Affiliates of the electric distribution company may submit proposals consistent with section 16-244h, regulations adopted under section 16-244h and other requirements the department may impose. The department may request from a person submitting a proposal further information that the department determines to be in the public interest to be used in evaluating the proposal. The department shall determine whether costs associated with subsection (l) of this section shall be considered in the evaluation or selection of bids.

      (d) The department shall publish such request for proposals in one or more newspapers or periodicals, as selected by the department, and shall post such request for proposals on its web site. The department may retain the services of a third-party entity with expertise in the area of energy procurement to oversee the development of the request for proposals and to assist the department in its approval of proposals pursuant to this section. The reasonable and proper expenses for retaining such third-party entity shall be recoverable through federally mandated congestion charges, as defined in section 16-1, which charges the department shall allocate to electric distribution companies in proportion to their revenue.

      (e) Any person, other than an electric distribution company, submitting a proposal pursuant to subdivision (2), (3) or (4) of subsection (c) of this section shall include with its proposal a draft of a contract that includes the transfer to the electric distribution company of all the rights to the installed capacity, including, but not limited to, forward reserve capacity, locational forward reserve capacity and similar rights associated with such proposal, provided such rights shall not include energy. No such draft of a contract shall have a term exceeding fifteen years. Such draft contract shall include such provisions as the Department of Public Utility Control directs.

      (f) Each person submitting a proposal pursuant to this section shall agree to forgo or credit reliability must run payments, locational installed capacity payments or payments for similar purposes for any project approved pursuant to subsection (g) of this section.

      (g) The department shall, on or before May 1, 2006, evaluate such proposals received pursuant to subsection (c) of this section and may approve one or more of such proposals. The department shall give preference to proposals that (1) result in the greatest aggregate reduction of federally mandated congestion charges for the period commencing on May 1, 2006, and ending on December 31, 2010, or such later date specified by the department, (2) make efficient use of existing sites and supply infrastructure, and (3) serve the long-term interests of ratepayers. Projects proposed by persons other than electric distribution companies approved pursuant to this subsection may enter into long-term contracts pursuant to subsection (i) of this section. Projects approved pursuant to this subsection are eligible for expedited siting pursuant to subsection (a) of section 16-50k. Customer-side distributed resource projects approved pursuant to this subsection shall be eligible for the incentives provided pursuant to sections 16-243j, 16-243l, and 16-243o and this section, but shall not be eligible for the programs described in section 16-243i.

      (h) If a proposal from an electric distribution company is approved pursuant to subsection (g) of this section, such company may develop, own and operate such resource, provided such company shall, not later than five years after such resource begins commercial operation, (1) sell such resource in accordance with section 16-43, or (2) auction the power or capacity, or both, associated with such resource pursuant to a plan approved by the department. The department shall, after notice and hearing, waive the requirements of subdivisions (1) and (2) of this subsection if it determines that compliance with such requirements would be detrimental to retail customers. Such electric distribution company shall recover, as federally mandated congestion charges, the unrecovered portions of the full projected costs in its proposal made under subsection (c) of this section.

      (i) An electric distribution company shall negotiate in good faith the final terms of the draft contract, submitted under subsection (e) of this section and included in a proposal approved under subsection (g) of this section, and shall apply to the department for approval of each such contract. After thirty days, either party may request the assistance of the department to resolve any outstanding issues. No such contract may become effective without approval of the department. The department shall hold a hearing that shall be conducted as a contested case, in accordance with the provisions of chapter 54, to approve, reject or modify an application for approval of a capacity purchase contract. No contract shall be approved unless the department finds that approval of such contract would (1) result in the lowest reasonable cost of such products and services, (2) increase reliability, and (3) minimize federally mandated congestion charges to the state over the life of the contract. Such a contract shall contain terms that mitigate the long-term risk assumed by ratepayers. No contract approved by the department shall have a term exceeding fifteen years. As determined by the department, the electric distribution company shall either sell into the capacity markets all or a portion of capacity rights transferred pursuant to this section and use all proceeds from such sales to offset federally mandated congestion charges incurred by all customers, or shall retain such capacity rights to offset electric capacity charges associated with transitional standard offer, standard service or service as supplier of last resort under section 16-244c. The costs associated with long-term electric capacity contracts shall be recovered through federally mandated congestion charges.

      (j) The provisions of section 16a-7c shall not apply to projects approved pursuant to this section.

      (k) The department may order an electric distribution company to submit a proposal pursuant to the provisions of this section and may approve such a proposal under this section. Nothing in sections 16-1, 16-19ss, 16-32f, 16-50i, 16-50k, 16-50x, 16-243i to 16-243q, inclusive, 16-244c, 16-244e, 16-245d, 16-245m, 16-245n and 16-245z and section 21 of public act 05-1 of the June special session* shall limit the department's ability to conduct requests for proposals, in addition to that in subsection (c) of this section, to reduce federally mandated congestion charges and to approve such proposals or otherwise to meet its responsibility under this title.

      (l) The department shall hold a hearing that shall be conducted as a contested case, in accordance with the provisions of chapter 54, to investigate any impact on the financial condition of electric distribution companies of long-term contracts entered into pursuant to this section and to establish, before issuing a request for proposals in accordance with subsection (c) of this section, the methodology for compensating the companies for such impacts. The methodology for addressing such impacts shall be included in the request for proposals under subsection (c) of this section, if appropriate. If the department determines that entering into such long-term contracts results in increased costs incurred by the electric distribution companies, the department, annually, shall allow such costs to be recovered through rates or in such manner as the department considers appropriate. The department shall determine whether such costs shall be considered in the evaluation or selection of bids under this section.

      (m) An electric distribution company may not submit a proposal under this section on or after February 1, 2011. On or before January 1, 2010, the department shall submit a report, in accordance with section 11-4a, to the joint standing committee of the General Assembly having cognizance of matters relating to energy with a recommendation as to whether the period during which such company may submit proposals under this section should be extended.

      (n) For purposes of subdivision (1) of subsection (c) of section 16-50p, there shall be a rebuttable presumption that there is a public benefit in building a facility, as defined in subdivision (1) of subsection (a) of section 16-50i, that has been approved by the Department of Public Utility Control pursuant to this section.

      (o) The aggregate electric generating capacity for all approved proposals by electric distribution companies pursuant to subsections (g) and (k) of this section may not exceed two hundred fifty megawatts of generating capacity state-wide. The department shall give guiding preference in approving the amount of generation capacity in proposals from electric distribution companies to the approximate proportion of each company's service area load.

      (p) When the department selects a bid pursuant to subdivisions (2) and (3) of subsection (c) of this section from a person other than an electric distribution company, the department shall grant the electric distribution company that serves the area in which the subject grid-side distributed resource or new generation facility is to be located a one-time, nonrecurring award, for investments necessary to improve the electric distribution company's transmission and distribution system to accommodate such facilities, in accordance with the following: For a grid-side distributed resource or new generation facility that is operational (1) on or before January 1, 2010, twenty-five dollars per kilowatt, (2) on or before January 1, 2011, fifteen dollars per kilowatt, and (3) on or before January 1, 2012, five dollars per kilowatt. The cost of the award shall be recoverable from federally mandated congestion charges. No such award may be made unless the projected reduction in federally mandated congestion charges attributed to the investment is greater than the amount of the award. Revenues from such award shall not be included in calculating the electric distribution company's earnings for the purpose of determining whether its rates are just and reasonable under sections 16-19, 16-19a and 16-19e.

      (q) Sixty days after the Department of Public Utility Control issues a final decision approving long-term contracts pursuant to this section, the department shall direct an electric distribution company to negotiate, in good faith, long-term contracts for the electric energy output of each of the generation projects selected and approved by the department to provide capacity pursuant to this section, provided the rates paid for such electric energy output when added to the payments made pursuant to such capacity contracts shall be the project's cost of service plus a reasonable rate of return. The electric distribution company shall apply to the department for approval of any such energy output contract. No such contract shall be effective unless approved by the department. The department may approve only such contracts it finds would reduce and stabilize the cost of electricity to Connecticut ratepayers. Such contract may not exceed the term of the capacity contract for such generation project.

      (June Sp. Sess. P.A. 05-1, S. 12; P.A. 06-196, S. 232; P.A. 07-242, S. 86.)

      *Note: Section 21 of public act 05-1 of the June special session is special in nature and therefore has not been codified but remains in full force and effect according to its terms.


      History: June Sp. Sess. P.A. 05-1 effective July 21, 2005; P.A. 06-196 made technical changes in Subsec. (c), effective June 7, 2006; P.A. 07-242 established requirements re long-term contracts for electric energy output that were added editorially by the Revisors as Subsec. (q), effective June 4, 2007.

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      Sec. 16-243n. Time-of-use, mandatory peak, shoulder, off-peak and seasonal rates. Optional interruptible or load response rates. (a) Not later than October 1, 2005, each electric distribution company, as defined in section 16-1, shall submit an application to the Department of Public Utility Control to (1) on or before January 1, 2007, implement time-of-use rates for customers that have a maximum demand of not less than three hundred fifty kilowatts that may include, but not be limited to, mandatory peak, shoulder and off-peak time-of-use rates, and (2) on or before June 1, 2006, offer optional interruptible or load response rates for customers that have a maximum demand of not less than three hundred fifty kilowatts and offer optional seasonal and time-of-use rates for all customers. The application shall propose to establish time-of-use rates through a procurement plan, revenue neutral adjustments to delivery rates, or both.

      (b) From March 1, 2006, until December 31, 2006, each electric distribution company shall issue comparative analyses to customers that have a maximum demand of not less than three hundred fifty kilowatts that would demonstrate, at current levels of consumption, the effects of the mandatory time-of-use rates as specified in subdivision (l) of subsection (a) of this section to be effective beginning January 1, 2007.

      (c) Not later than November 1, 2005, each electric distribution company shall submit an application to the Department of Public Utility Control to implement mandatory seasonal rates for all customers beginning April 1, 2007.

      (d) From April 1, 2006, until March 31, 2007, each electric distribution company shall issue comparative analyses to all customers that demonstrate, at current levels of consumption, the effects of the mandatory seasonal rates that will be effective beginning April 1, 2007.

      (e) The department shall hold a hearing that shall be conducted as a contested case, in accordance with the provisions of chapter 54, to approve, reject or modify applications submitted pursuant to subsection (a) or (c) of this section. No application for time-of-use rates shall be approved unless (1) such rates reasonably reflect the cost of service during their respective time-of-use periods, and (2) the costs associated with implementation, the impact on customers and benefits to the utility system justify implementation of such rates, and (3) such rates alter patterns of customer consumption of electricity without undue adverse effect on the customer.

      (f) Each electric distribution company shall assist customers to help manage loads and reduce peak consumption through the comprehensive plan developed pursuant to section 16-245m.

      (g) The department shall conduct a contested case, in accordance with chapter 54, to determine the standards under which, and process by which, a customer, having a maximum demand of three hundred fifty kilowatts or more, may obtain an exemption, until July 1, 2010, from mandatory time-of-use rates as specified in subdivision (1) of subsection (a) of this section. The department shall issue a decision in the contested case no later than January 1, 2006.

      (June Sp. Sess. P.A. 05-1, S. 13; P.A. 07-242, S. 85.)

      History: June Sp. Sess. P.A. 05-1 effective July 21, 2005; P.A. 07-242 amended Subsec. (a)(1) to require implementation of time-of-use rates that may include mandatory peak, shoulder and off-peak time-of-use rates and amended Subsec. (e)(1) to make a conforming change, effective June 4, 2007.

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      Sec. 16-243q. Class III renewable energy portfolio standards. (a) On and after January 1, 2007, each electric distribution company providing standard service pursuant to section 16-244c and each electric supplier as defined in section 16-1 shall demonstrate to the satisfaction of the Department of Public Utility Control that not less than one per cent of the total output of such supplier or such standard service of an electric distribution company shall be obtained from Class III sources. On and after January 1, 2008, not less than two per cent of the total output of any such supplier or such standard service of an electric distribution company shall, on demonstration satisfactory to the Department of Public Utility Control, be obtained from Class III sources. On or after January 1, 2009, not less than three per cent of the total output of any such supplier or such standard service of an electric distribution company shall, on demonstration satisfactory to the Department of Public Utility Control, be obtained from Class III sources. On and after January 1, 2010, not less than four per cent of the total output of any such supplier or such standard service of an electric distribution company shall, on demonstration satisfactory to the Department of Public Utility Control, be obtained from Class III sources. Electric power obtained from customer-side distributed resources that does not meet air and water quality standards of the Department of Environmental Protection is not eligible for purposes of meeting the percentage standards in this section.

      (b) Except as provided in subsection (d) of this section, the Department of Public Utility Control shall assess each electric supplier and each electric distribution company that fails to meet the percentage standards of subsection (a) of this section a charge of up to five and five-tenths cents for each kilowatt hour of electricity that such supplier or company is deficient in meeting such percentage standards. Seventy-five per cent of such assessed charges shall be deposited in the Energy Conservation and Load Management Fund established in section 16-245m, and twenty-five per cent shall be deposited in the Renewable Energy Investment Fund established in section 16-245n, except that such seventy-five per cent of assessed charges with respect to an electric supplier shall be divided among the Energy Conservation and Load Management Funds of electric distribution companies in proportion to the amount of electricity such electric supplier provides to end use customers in the state using the facilities of each electric distribution company.

      (c) An electric supplier or electric distribution company may satisfy the requirements of this section by participating in a conservation and distributed resources trading program approved by the Department of Public Utility Control. Credits created by conservation and customer-side distributed resources shall be allocated to the person that conserved the electricity or installed the project for customer-side distributed resources to which the credit is attributable and to the Energy Conservation and Load Management Fund. Such credits shall be made in the following manner: A minimum of twenty-five per cent of the credits shall be allocated to the person that conserved the electricity or installed the project for customer-side distributed resources to which the energy credit is attributable and the remainder of the credits shall be allocated to the Energy Conservation and Load Management Fund, based on a schedule created by the department no later than January 1, 2007, and reviewed annually thereafter. The department may, in a proceeding and for good cause shown, allocate a larger proportion of such credits to the person who conserved the electricity or installed the customer-side distributed resources. The department shall consider the proportion of investment made by a ratepayer through various ratepayer-funded incentive programs and the resulting reduction in federally mandated congestion charges. The portion allocated to the Energy Conservation and Load Management Fund shall be used for measures that respond to energy demand and for peak reduction programs.

      (d) An electric distribution company providing standard service may contract with its wholesale suppliers to comply with the conservation and customer-side distributed resources standards set forth in subsection (a) of this section. The Department of Public Utility Control shall annually conduct a contested case, in accordance with the provisions of chapter 54, to determine whether the electric distribution company's wholesale suppliers met the conservation and distributed resources standards during the preceding year. Any such contract shall include a provision that requires such supplier to pay the electric distribution company in an amount of up to five and one-half cents per kilowatt hour if the wholesale supplier fails to comply with the conservation and distributed resources standards during the subject annual period. The electric distribution company shall immediately transfer seventy-five per cent of any payment received from the wholesale supplier for the failure to meet the conservation and distributed resources standards to the Energy Conservation and Load Management Fund and twenty-five per cent to the Renewable Energy Investment Fund. Any payment made pursuant to this section shall not be considered revenue or income to the electric distribution company.

      (e) The Department of Public Utility Control shall conduct a contested proceeding to develop the administrative processes and program specifications that are necessary to implement a Class III sources conservation and distributed resources trading program. The proceeding shall include, but not be limited to, an examination of issues such as (1) the manner in which qualifying activities are certified, tracked and reported, (2) the manner in which Class III certificates are created, accounted for and transferred, (3) verification of the accuracy of conservation and customer-side distributed resources credits, (4) verification of the fact that resources or credits used to satisfy the requirement of this section have not been used to satisfy any other portfolio or similar requirement, (5) the manner in which credits created by conservation and customer-side distributed resources may best be allocated to maximize the impact of the trading program, and (6) setting such alternative payment amounts at a level that encourages development of conservation and customer-side distributed resources. The department may retain the services of a third party entity with expertise in the development of energy efficiency trading or verification programs to assist in the development and operation of the program. The department shall issue a decision no later than February 1, 2008.

      (June Sp. Sess. P.A. 05-1, S. 16; P.A. 07-242, S. 43.)

      History: June Sp. Sess. P.A. 05-1 effective July 21, 2005; P.A. 07-242 changed "Class III resources" to "Class III sources" throughout, amended Subsec. (a) to add water quality standards to standards that electric power obtained from customer-side distributed resources must meet, and amended Subsec. (e) to delete former Subdiv. (3) re feasibility and benefits of expanding eligible Class III resources to include those resulting from residential customer electricity savings, redesignate existing Subdivs. (4) to (7) as Subdivs. (3) to (6) and change date by which department must issue a decision from February 1, 2006, to February 1, 2008.

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      Sec. 16-243r. Customer-side distributed resources and grid-side distributed resources. Qualifications for applicability of certain provisions. The provisions of sections 7-233y, 16-1, 16-19ss, 16-32f, 16-50i, 16-50k, 16-50x, 16-243i to 16-243q, inclusive, 16-244c, 16-244e, 16-245d, 16-245m, 16-245n, 16-245z and 16-262i and section 21 of public act 05-1 of the June special session*, apply to new customer-side distributed resources and grid-side distributed resources developed in this state that add electric capacity on and after January 1, 2006, and shall also apply to customer-side distributed resources and grid-side distributed resources developed in this state before January 1, 2007, that (1) have undergone upgrades that increase the resource's thermal efficiency operating level by no fewer than ten percentage points or, for resources that have a thermal efficiency level of at least seventy per cent, have undergone upgrades that increase the resource's turbine heat rate by no fewer than five percentage points and increase the electrical output of the resource by no fewer than ten percentage points, (2) operate at a thermal efficiency level of at least fifty per cent, and (3) add electric capacity in this state on or after January 1, 2007, provided such measure is in accordance with the provisions of said sections 7-233y, 16-1, 16-19ss, 16-32f, 16-50i, 16-50k, 16-50x, 16-243i to 16-243q, inclusive, 16-244c, 16-244e, 16-245d, 16-245m, 16-245n, 16-245z and 16-262i and section 21 of public act 05-1 of the June special session*. On or before January 1, 2009, the Department of Public Utility Control, in consultation with the Office of Consumer Counsel, shall report to the joint standing committee of the General Assembly having cognizance of matters relating to energy regarding the cost-effectiveness of programs pursuant to this section.

      (June Sp. Sess. P.A. 05-1, S. 19; P.A. 07-242, S. 18.)

      *Note: Section 21 of public act 05-1 of the June special session is special in nature and therefore has not been codified but remains in full force and effect according to its terms.


      History: June Sp. Sess. P.A. 05-1 effective July 21, 2005; P.A. 07-242 provided that referenced sections apply to new resources, added requirements for resources developed before January 1, 2007, and required department to report to the General Assembly, effective July 1, 2007.

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      Sec. 16-243t. Class III credits. (a) Notwithstanding the provisions of this title, a customer who implements energy conservation or customer-side distributed resources, as defined in section 16-1, on or after January 1, 2008, shall be eligible for Class III credits, pursuant to section 16-243q. The Class III credit shall be not less than one cent per kilowatt hour. For nonresidential projects receiving conservation and load management funding, twenty-five per cent of the financial value derived from the credits earned pursuant to this section shall be directed to the customer who implements energy conservation or customer-side distribution resources pursuant to this section with the remainder of the financial value directed to the Conservation and Load Management Funds. For nonresidential projects not receiving conservation and load management funding submitted on or after March 9, 2007, seventy-five per cent of the financial value derived from the credits earned pursuant to this section shall be directed to the customer who implements energy conservation or customer-side distribution resources pursuant to this section with the remainder of the financial value directed to the Conservation and Load Management Funds. Not later than July 1, 2007, the Department of Public Utility Control shall initiate a contested case proceeding in accordance with the provisions of chapter 54, to implement the provisions of this section.

      (b) In order to be eligible for ongoing Class III credits, the customer shall file an application that contains information necessary for the department to determine that the resource qualifies for Class III status. Such application shall (1) certify that installation and metering requirements have been met where appropriate, (2) provide a detailed energy savings or energy output calculation for such time period as specified by the department, and (3) include any other information that the department deems appropriate.

      (c) For conservation and load management projects that serve residential customers, seventy-five per cent of the financial value derived from the credits shall be directed to the Conservation and Load Management Funds.

      (P.A. 07-242, S. 42.)

      History: P.A. 07-242 effective June 4, 2007.

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      Sec. 16-243u. Plan to build peaking generation. From January 1, 2008, until February 1, 2008, any person may, and an electric distribution company shall, submit a plan to build peaking generation, or the electric distribution companies may submit a joint ownership plan to build peaking generation, to be heard in a contested case proceeding before the Department of Public Utility Control. An electric distribution company's plan shall include its full projected costs and shall demonstrate to the department that it is not supported in any form of cross subsidization by affiliated entities. Any plan approved by the department shall (1) include a requirement that the owner of the peaking generation is compensated at cost of service plus reasonable rate of return as determined by the department, and (2) require that such peaking generation facility is operated at such times and such capacity so as to reduce overall electricity rates for consumers. The department may retain a consultant to help determine if projected costs included in the plan are good faith preliminary estimates and may require modification of the plan as necessary to protect the best interests of ratepayers. Not later than one hundred twenty days after the plan is submitted, the department shall approve the plan unless it demonstrates in detail, pursuant to section 16-19e, that such plan is not in the best interests of ratepayers. The department shall request that any person submitting a plan to submit further information it deems to be in the public interest that the department shall use in evaluating the proposal. Such person shall only recover the just and reasonable costs of construction of the facility and, in an annual retail generation rate contested case, shall be entitled to recover its prudently incurred costs of such project, including, but not limited to, capital costs, operation and maintenance expenses, depreciation, fuel costs, taxes and other governmental charges and a reasonable rate of return on equity. The department shall review such recovery of costs consistent with the principles set forth in sections 16-19, 16-19b and 16-19e, provided the return on equity associated with such project shall be established in the initial annual contested case proceeding under this subsection and updated at least once every four years. A person operating a peaking generation unit pursuant to this section shall bid the unit into all regional independent system operator markets, including the energy market, capacity market or forward reserve market, using cost-of-service principles and pursuant to guidelines established by the department each year in the annual retail generation rate case pursuant to this section.

      (P.A. 07-242, S. 50.)

      History: P.A. 07-242 effective January 1, 2008.

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      Sec. 16-243v. Connecticut electric efficiency partner program. (a) For purposes of this section: (1) "Connecticut electric efficiency partner program" means the coordinated effort among the Department of Public Utility Control, persons and entities providing enhanced demand-side management technologies, and electric consumers to conserve electricity and reduce demand in Connecticut through the purchase and deployment of energy efficient technologies; (2) "enhanced demand-side management technologies" means demand-side management solutions, customer-side emergency dispatchable generation resources, customer-side renewable energy generation, load shifting technologies and conservation and load management technologies that reduce electric distribution company customers' electric demand, and high efficiency natural gas and oil boilers and furnaces; and (3) "Connecticut electric efficiency partner" means an electric distribution company customer who acquires an enhanced demand-side management technology or a person, other than an electric distribution company, that provides enhanced demand-side management technologies to electric distribution company customers.

      (b) The Energy Conservation Management Board, in consultation with the Renewable Energy Investments Advisory Committee, shall evaluate and approve enhanced demand-side management technologies that can be deployed by Connecticut electric efficiency partners to reduce electric distribution company customers' electric demand. Such evaluation shall include an examination of the potential to reduce customers' demand, federally mandated congestion charges and other electric costs. On or before October 15, 2007, the Energy Conservation Management Board shall file such evaluation with the Department of Public Utility Control for the department to review and approve or to review, modify and approve on or before October 15, 2007.

      (c) Not later than October 15, 2007, the Energy Conservation Management Board shall file with the department, for the department to review and approve or to review, modify and approve, an analysis of the state's electric demand, peak electric demand and growth forecasts for electric demand and peak electric demand. Such analysis shall identify the principal drivers of electric demand and peak electric demand, associated electric charges tied to electric demand and peak electric demand growth, including, but not limited to, federally mandated congestion charges and other electric costs, and any other information the department deems appropriate. The analysis shall include, but not be limited to, an evaluation of the costs and benefits of the enhanced demand-side management technologies approved pursuant to subsection (b) of this section and establishing suggested funding levels for said individual technologies.

      (d) Commencing April 1, 2008, any person may apply to the department for certification and funding as a Connecticut electric efficiency partner. Such application shall include the technologies that the applicant shall purchase or provide and that have been approved pursuant to subsection (b) of this section. In evaluating the application, the department shall (1) consider the applicant's potential to reduce customers' electric demand, including peak electric demand, and associated electric charges tied to electric demand and peak electric demand growth, (2) determine the portion of the total cost of each project that shall be paid for by the customer participating in this program and the portion of the total cost of each project that shall be paid for by all electric ratepayers and collected pursuant to subsection (h) of this section. In making such determination, the department shall ensure that all ratepayer investments maintain a minimum two-to-one payback ratio, and (3) specify that participating Connecticut electric efficiency partners shall maintain the technology for a period sufficient to achieve such investment payback ratio. The annual ratepayer contribution for projects approved pursuant to this section shall not exceed sixty million dollars. Not less than seventy-five per cent of such annual ratepayer investment shall be used for the technologies themselves. No person shall receive electric ratepayer funding pursuant to this subsection if such person has received or is receiving funding from the Energy Conservation and Load Management Funds for the projects included in said person's application. No person shall receive electric ratepayer funding without receiving a certificate of public convenience and necessity as a Connecticut electric efficiency partner by the department. The department may grant an applicant a certificate of public convenience if it possesses and demonstrates adequate financial resources, managerial ability and technical competency. The department may conduct additional requests for proposals from time to time as it deems appropriate. The department shall specify the manner in which a Connecticut electric efficiency partner shall address measures of effectiveness and shall include performance milestones.

      (e) Beginning February 1, 2010, a certified Connecticut electric efficiency partner may only receive funding if selected in a request for proposal developed, issued and evaluated by the department. In evaluating a proposal, the department shall take into consideration the potential to reduce customers' electric demand including peak electric demand, and associated electric charges tied to electric demand and peak electric demand growth, including, but not limited to, federally mandated congestion charges and other electric costs, and shall utilize a cost benefit test established pursuant to subsection (c) of this section to rank responses for selection. The department shall determine the portion of the total cost of each project that shall be paid by the customer participating in this program and the portion of the total cost of each project that shall be paid by all electric ratepayers and collected pursuant to the provisions of this subsection. In making such determination, the department shall (1) ensure that all ratepayer investments maintain a minimum two-to-one payback ratio, and (2) specify that participating Connecticut electric efficiency partners shall maintain the technology for a period sufficient to achieve such investment payback ratio. The annual ratepayer contribution shall not exceed sixty million dollars. Not less than seventy-five per cent of such annual ratepayer investment shall be used for the technologies themselves. No Connecticut electric efficiency partner shall receive funding pursuant to this subsection if such partner has received or is receiving funding from the Energy Conservation and Load Management Funds for such technology. The department may conduct additional requests for proposals from time to time as it deems appropriate. The department shall specify the manner in which a Connecticut electric efficiency partner shall address measures of effectiveness and shall include performance milestones.

      (f) The department may retain the services of a third party entity with expertise in areas such as demand-side management solutions, customer-side renewable energy generation, customer-side distributed generation resources, customer-side emergency dispatchable generation resources, load shifting technologies and conservation and load management investments to assist in the development and operation of the Connecticut electric efficiency partner program. The costs for obtaining third party services pursuant to this subsection shall be recoverable through the systems benefits charge.

      (g) The department shall develop a long-term low-interest loan program to assist certified Connecticut electric efficiency partners in financing the customer portion of the capital costs of approved enhanced demand-side management technologies. The department may establish such financing mechanism by the use of one or more of the following strategies: (1) Modifying the existing long-term customer-side distributed generation financing mechanism established pursuant to section 16-243j, (2) negotiating and entering into an agreement with the Connecticut Development Authority to establish a credit facility or to utilize grants, loans or loan guarantees for the purposes of this section upon such terms and conditions as the authority may prescribe including provisions regarding the rights and remedies available to the authority in case of default, or (3) selecting by competitive bid one or more entities that can provide such long-term financing.

      (h) The department shall provide for the payment of electric ratepayers' portion of the costs of deploying enhanced demand-side management technologies by implementing a contractual financing agreement with the Connecticut Development Authority or a private financing entity selected through an appropriate open competitive selection process. No contractual financing agreements entered into with the Connecticut Development Authority shall exceed ten million dollars. Any electric ratepayer costs resulting from such financing agreement shall be recovered from all electric ratepayers through the systems benefits charge.

      (i) On or before February 15, 2009, and annually thereafter, the department shall report to the joint standing committee of the General Assembly having cognizance of matters relating to energy regarding the effectiveness of the Connecticut electric efficiency partner program established pursuant to this section. Said report shall include, but not be limited to, an accounting of all benefits and costs to ratepayers, a description of the approved technologies, the payback ratio of all investments, the number of programs deployed and a list of proposed projects compared to approved projects and reasons for not being approved.

      (j) On or before April 1, 2011, the Department of Public Utility Control shall initiate a proceeding to review the effectiveness of the program and perform a ratepayer cost-benefit analysis. Based upon the department's findings in the proceeding, the department may modify or discontinue the partnership program established pursuant to this section.

      (P.A. 07-242, S. 94.)

      History: P.A. 07-242 effective June 4, 2007.

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      Sec. 16-243w. Advanced metering system plan and deployment. (a) On or before July 1, 2007, each electric distribution company shall submit a plan to the Department of Public Utility Control to deploy an advanced metering system. In lieu of submitting a plan pursuant to this section, an electric distribution company may seek a determination by the department that such company's existing metering system meets the requirements of this section. Such metering systems shall support net metering and be capable of tracking hourly consumption to support proactive customer pricing signals through innovative rate design, such as time-of-day or real-time pricing of electric service for all customer classes.

      (b) Each plan to implement an advanced metering system developed pursuant to subsection (a) of this section shall outline an implementation schedule whereby meters and any network necessary to support such meters are fully deployed on or before January 1, 2009. On or after January 1, 2009, any customer may obtain a meter on demand.

      (c) The cost of the advanced metering system, including, but not limited to, the meters, the network to support the meters, software and vendor costs to obtain the required information from the metering system and administrative, installation, operation maintenance costs, shall be borne by the electric distribution company and shall be recoverable in rates. Any unrecovered cost of the current metering system shall continue to be reflected in rates.

      (d) Not later than six months after June 4, 2007, electric distribution companies, competitive electric suppliers and aggregators shall offer time-of-use pricing options to all customer classes. These pricing options shall include, but not be limited to, hourly and real-time pricing options.

      (P.A. 07-242, S. 98.)

      History: P.A. 07-242 effective June 4, 2007.

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      Sec. 16-244c. Standard offer. Transitional standard offer. Standard service. Alternative transitional standard offer and standard service. Supplier of last resort. Back-up generation service. Participating electric suppliers. (a)(1) On and after January 1, 2000, each electric distribution company shall make available to all customers in its service area, the provision of electric generation and distribution services through a standard offer. Under the standard offer, a customer shall receive electric services at a rate established by the Department of Public Utility Control pursuant to subdivision (2) of this subsection. Each electric distribution company shall provide electric generation services in accordance with such option to any customer who affirmatively chooses to receive electric generation services pursuant to the standard offer or does not or is unable to arrange for or maintain electric generation services with an electric supplier. The standard offer shall automatically terminate on January 1, 2004. While providing electric generation services under the standard offer, an electric distribution company may provide electric generation services through any of its generation entities or affiliates, provided such entities or affiliates are licensed pursuant to section 16-245.

      (2) Not later than October 1, 1999, the Department of Public Utility Control shall establish the standard offer for each electric distribution company, effective January 1, 2000, which shall allocate the costs of such company among electric transmission and distribution services, electric generation services, the competitive transition assessment and the systems benefits charge. The department shall hold a hearing that shall be conducted as a contested case in accordance with chapter 54 to establish the standard offer. The standard offer shall provide that the total rate charged under the standard offer, including electric transmission and distribution services, the conservation and load management program charge described in section 16-245m, the renewable energy investment charge described in section 16-245n, electric generation services, the competitive transition assessment and the systems benefits charge shall be at least ten per cent less than the base rates, as defined in section 16-244a, in effect on December 31, 1996. The standard offer shall be adjusted to the extent of any increase or decrease in state taxes attributable to sections 12-264 and 12-265 and any other increase or decrease in state or federal taxes resulting from a change in state or federal law and shall continue to be adjusted during such period pursuant to section 16-19b. Notwithstanding the provisions of section 16-19b, the provisions of said section 16-19b shall apply to electric distribution companies. The standard offer may be adjusted, by an increase or decrease, to the extent approved by the department, in the event that (A) the revenue requirements of the company are affected as the result of changes in (i) legislative enactments other than public act 98-28*, (ii) administrative requirements, or (iii) accounting standards occurring after July 1, 1998, provided such accounting standards are adopted by entities independent of the company that have authority to issue such standards, or (B) an electric distribution company incurs extraordinary and unanticipated expenses required for the provision of safe and reliable electric service to the extent necessary to provide such service. Savings attributable to a reduction in taxes shall not be shifted between customer classes.

      (3) The price reduction provided in subdivision (2) of this subsection shall not apply to customers who, on or after July 1, 1998, are purchasing electric services from an electric company or electric distribution company, as the case may be, under a special contract or flexible rate tariff, and the company's filed standard offer tariffs shall reflect that such customers shall not receive the standard offer price reduction.

      (b) (1) (A) On and after January 1, 2004, each electric distribution company shall make available to all customers in its service area, the provision of electric generation and distribution services through a transitional standard offer. Under the transitional standard offer, a customer shall receive electric services at a rate established by the Department of Public Utility Control pursuant to subdivision (2) of this subsection. Each electric distribution company shall provide electric generation services in accordance with such option to any customer who affirmatively chooses to receive electric generation services pursuant to the transitional standard offer or does not or is unable to arrange for or maintain electric generation services with an electric supplier. The transitional standard offer shall terminate on December 31, 2006. While providing electric generation services under the transitional standard offer, an electric distribution company may provide electric generation services through any of its generation entities or affiliates, provided such entities or affiliates are licensed pursuant to section 16-245.

      (B) The department shall conduct a proceeding to determine whether a practical, effective, and cost-effective process exists under which an electric customer, when initiating electric service, may receive information regarding selecting electric generating services from a qualified entity. The department shall complete such proceeding on or before December 1, 2005, and shall implement the resulting decision on or before March 1, 2006, or on such later date that the department considers appropriate. An electric distribution company's costs of participating in the proceeding and implementing the results of the department's decision shall be recoverable by the company as generation services costs through an adjustment mechanism as approved by the department.

      (2) (A) Not later than December 15, 2003, the Department of Public Utility Control shall establish the transitional standard offer for each electric distribution company, effective January 1, 2004.

      (B) The department shall hold a hearing that shall be conducted as a contested case in accordance with chapter 54 to establish the transitional standard offer. The transitional standard offer shall provide that the total rate charged under the transitional standard offer, including electric transmission and distribution services, the conservation and load management program charge described in section 16-245m, the renewable energy investment charge described in section 16-245n, electric generation services, the competitive transition assessment and the systems benefits charge, and excluding federally mandated congestion costs, shall not exceed the base rates, as defined in section 16-244a, in effect on December 31, 1996, excluding any rate reduction ordered by the department on September 26, 2002.

      (C) (i) Each electric distribution company shall, on or before January 1, 2004, file with the department an application for an amendment of rates pursuant to section 16-19, which application shall include a four-year plan for the provision of electric transmission and distribution services. The department shall conduct a contested case proceeding pursuant to sections 16-19 and 16-19e to approve, reject or modify the application and plan. Upon the approval of such plan, as filed or as modified by the department, the department shall order that such plan shall establish the electric transmission and distribution services component of the transitional standard offer.

      (ii) Notwithstanding the provisions of this subparagraph, an electric distribution company that, on or after September 1, 2002, completed a proceeding pursuant to sections 16-19 and 16-19e, shall not be required to file an application for an amendment of rates as required by this subparagraph. The department shall establish the electric transmission and distribution services component of the transitional standard offer for any such company equal to the electric transmission and distribution services component of the standard offer established pursuant to subsection (a) of this section in effect on July 1, 2003, for such company. If such electric distribution company applies to the department, pursuant to section 16-19, for an amendment of its rates on or before December 31, 2006, the application of the electric distribution company shall include a four-year plan.

      (D) The transitional standard offer (i) shall be adjusted to the extent of any increase or decrease in state taxes attributable to sections 12-264 and 12-265 and any other increase or decrease in state or federal taxes resulting from a change in state or federal law, (ii) shall be adjusted to provide for the cost of contracts under subdivision (2) of subsection (j) of this section and the administrative costs for the procurement of such contracts, and (iii) shall continue to be adjusted during such period pursuant to section 16-19b. Savings attributable to a reduction in taxes shall not be shifted between customer classes. Notwithstanding the provisions of section 16-19b, the provisions of section 16-19b shall apply to electric distribution companies.

      (E) The transitional standard offer may be adjusted, by an increase or decrease, to the extent approved by the department, in the event that (i) the revenue requirements of the company are affected as the result of changes in (I) legislative enactments other than public act 03-135* or public act 98-28*, (II) administrative requirements, or (III) accounting standards adopted after July 1, 2003, provided such accounting standards are adopted by entities that are independent of the company and have authority to issue such standards, or (ii) an electric distribution company incurs extraordinary and unanticipated expenses required for the provision of safe and reliable electric service to the extent necessary to provide such service.

      (3) The price provided in subdivision (2) of this subsection shall not apply to customers who, on or after July 1, 2003, purchase electric services from an electric company or electric distribution company, as the case may be, under a special contract or flexible rate tariff, provided the company's filed transitional standard offer tariffs shall reflect that such customers shall not receive the transitional standard offer price during the term of said contract or tariff.

      (4) (A) In addition to its costs received pursuant to subsection (h) of this section, as compensation for providing transitional standard offer service, each electric distribution company shall receive an amount equal to five-tenths of one mill per kilowatt hour. Revenues from such compensation shall not be included in calculating the electric distribution company's earnings for purposes of, or in determining whether its rates are just and reasonable under, sections 16-19, 16-19a and 16-19e, including an earnings sharing mechanism. In addition, each electric distribution company may earn compensation for mitigating the prices of the contracts for the provision of electric generation services, as provided in subdivision (2) of this subsection.

      (B) The department shall conduct a contested case proceeding pursuant to the provisions of chapter 54 to establish an incentive plan for the procurement of long-term contracts for transitional standard offer service by an electric distribution company. The incentive plan shall be based upon a comparison of the actual average firm full requirements service contract price for electricity obtained by the electric distribution company compared to the regional average firm full requirements service contract price for electricity, adjusted for such variables as the department deems appropriate, including, but not limited to, differences in locational marginal pricing. If the actual average firm full requirements service contract price obtained by the electric distribution company is less than the actual regional average firm full requirements service contract price for the previous year, the department shall split five-tenths of one mill per kilowatt hour equally between ratepayers and the company. Revenues from such incentive plan shall not be included in calculating the electric distribution company's earnings for purposes of, or in determining whether its rates are just and reasonable under sections 16-19, 16-19a and 16-19e. The department may, as it deems necessary, retain a third party entity with expertise in energy procurement to assist with the development of such incentive plan.

      (c) (1) On and after January 1, 2007, each electric distribution company shall provide electric generation services through standard service to any customer who (A) does not arrange for or is not receiving electric generation services from an electric supplier, and (B) does not use a demand meter or has a maximum demand of less than five hundred kilowatts.

      (2) Not later than October 1, 2006, and periodically as required by subdivision (3) of this subsection, but not more often than every calendar quarter, the Department of Public Utility Control shall establish the standard service price for such customers pursuant to subdivision (3) of this subsection. Each electric distribution company shall recover the actual net costs of procuring and providing electric generation services pursuant to this subsection, provided such company mitigates the costs it incurs for the procurement of electric generation services for customers who are no longer receiving service pursuant to this subsection.

      (3) An electric distribution company providing electric generation services pursuant to this subsection shall mitigate the variation of the price of the service offered to its customers by procuring electric generation services contracts in the manner prescribed in a plan approved by the department. Such plan shall require the procurement of a portfolio of service contracts sufficient to meet the projected load of the electric distribution company. Such plan shall require that the portfolio of service contracts be procured in an overlapping pattern of fixed periods at such times and in such manner and duration as the department determines to be most likely to produce just, reasonable and reasonably stable retail rates while reflecting underlying wholesale market prices over time. The portfolio of contracts shall be assembled in such manner as to invite competition; guard against favoritism, improvidence, extravagance, fraud and corruption; and secure a reliable electricity supply while avoiding unusual, anomalous or excessive pricing. The portfolio of contracts procured under such plan shall be for terms of not less than six months, provided contracts for shorter periods may be procured under such conditions as the department shall prescribe to (A) ensure the lowest rates possible for end-use customers; (B) ensure reliable service under extraordinary circumstances; and (C) ensure the prudent management of the contract portfolio. An electric distribution company may receive a bid for an electric generation services contract from any of its generation entities or affiliates, provided such generation entity or affiliate submits its bid the business day preceding the first day on which an unaffiliated electric supplier may submit its bid and further provided the electric distribution company and the generation entity or affiliate are in compliance with the code of conduct established in section 16-244h.

      (4) The department, in consultation with the Office of Consumer Counsel, shall retain the services of a third-party entity with expertise in the area of energy procurement to oversee the initial development of the request for proposals and the procurement of contracts by an electric distribution company for the provision of electric generation services offered pursuant to this subsection. Costs associated with the retention of such third-party entity shall be included in the cost of electric generation services that is included in such price.

      (5) Each bidder for a standard service contract shall submit its bid to the electric distribution company and the third-party entity who shall jointly review the bids and submit an overview of all bids together with a joint recommendation to the department as to the preferred bidders. The department may, within ten business days of submission of the overview, reject the recommendation regarding preferred bidders. In the event that the department rejects the preferred bids, the electric distribution company and the third-party entity shall rebid the service pursuant to this subdivision.

      (d) (1) Notwithstanding the provisions of this section regarding the electric generation services component of the transitional standard offer or the procurement of electric generation services under standard service, section 16-244h or 16-245o, the Department of Public Utility Control may, from time to time, direct an electric distribution company to offer, through an electric supplier or electric suppliers, before January 1, 2007, one or more alternative transitional standard offer options or, on or after January 1, 2007, one or more alternative standard service options. Such alternative options shall include, but not be limited to, an option that consists of the provision of electric generation services that exceed the renewable portfolio standards established in section 16-245a and may include an option that utilizes strategies or technologies that reduce the overall consumption of electricity of the customer.

      (2) (A) The department shall develop such alternative option or options in a contested case conducted in accordance with the provisions of chapter 54. The department shall determine the terms and conditions of such alternative option or options, including, but not limited to, (i) the minimum contract terms, including pricing, length and termination of the contract, and (ii) the minimum percentage of electricity derived from Class I or Class II renewable energy sources, if applicable. The electric distribution company shall, under the supervision of the department, subsequently conduct a bidding process in order to solicit electric suppliers to provide such alternative option or options.

      (B) The department may reject some or all of the bids received pursuant to the bidding process.

      (3) The department may require an electric supplier to provide forms of assurance to satisfy the department that the contracts resulting from the bidding process will be fulfilled.

      (4) An electric supplier who fails to fulfill its contractual obligations resulting from this subdivision shall be subject to civil penalties, in accordance with the provisions of section 16-41, or the suspension or revocation of such supplier's license or a prohibition on the acceptance of new customers, following a hearing that is conducted as a contested case, in accordance with the provisions of chapter 54.

      (e) (1) On and after January 1, 2007, an electric distribution company shall serve customers that are not eligible to receive standard service pursuant to subsection (c) of this section as the supplier of last resort. This subsection shall not apply to customers purchasing power under contracts entered into pursuant to section 16-19hh.

      (2) An electric distribution company shall procure electricity at least every calendar quarter to provide electric generation services to customers pursuant to this subsection. The Department of Public Utility Control shall determine a price for such customers that reflects the full cost of providing the electricity on a monthly basis. Each electric distribution company shall recover the actual net costs of procuring and providing electric generation services pursuant to this subsection, provided such company mitigates the costs it incurs for the procurement of electric generation services for customers that are no longer receiving service pursuant to this subsection.

      (f) On and after January 1, 2000, and until such time the regional independent system operator implements procedures for the provision of back-up power to the satisfaction of the Department of Public Utility Control, each electric distribution company shall provide electric generation services to any customer who has entered into a service contract with an electric supplier that fails to provide electric generation services for reasons other than the customer's failure to pay for such services. Between January 1, 2000, and December 31, 2006, an electric distribution company may procure electric generation services through a competitive bidding process or through any of its generation entities or affiliates. On and after January 1, 2007, such company shall procure electric generation services through a competitive bidding process pursuant to a plan submitted by the electric distribution company and approved by the department. Such company may procure electric generation services through any of its generation entities or affiliates, provided such entity or affiliate is the lowest qualified bidder and provided further any such entity or affiliate is licensed pursuant to section 16-245.

      (g) An electric distribution company is not required to be licensed pursuant to section 16-245 to provide standard offer electric generation services in accordance with subsection (a) of this section, transitional standard offer service pursuant to subsection (b) of this section, standard service pursuant to subsection (c) of this section, supplier of last resort service pursuant to subsection (e) of this section or back-up electric generation service pursuant to subsection (f) of this section.

      (h) The electric distribution company shall be entitled to recover reasonable costs incurred as a result of providing standard offer electric generation services pursuant to the provisions of subsection (a) of this section, transitional standard offer service pursuant to subsection (b) of this section, standard service pursuant to subsection (c) of this section or back-up electric generation service pursuant to subsection (f) of this section. The provisions of this section and section 16-244a shall satisfy the requirements of section 16-19a until January 1, 2007.

      (i) The Department of Public Utility Control shall establish, by regulations adopted pursuant to chapter 54, procedures for when and how a customer is notified that his electric supplier has defaulted and of the need for the customer to choose a new electric supplier within a reasonable period of time.

      (j) (1) Notwithstanding the provisions of subsection (d) of this section regarding an alternative transitional standard offer option or an alternative standard service option, an electric distribution company providing transitional standard offer service, standard service, supplier of last resort service or back-up electric generation service in accordance with this section shall contract with its wholesale suppliers to comply with the renewable portfolio standards. The Department of Public Utility Control shall annually conduct a contested case, in accordance with the provisions of chapter 54, in order to determine whether the electric distribution company's wholesale suppliers met the renewable portfolio standards during the preceding year. An electric distribution company shall include a provision in its contract with each wholesale supplier that requires the wholesale supplier to pay the electric distribution company an amount of five and one-half cents per kilowatt hour if the wholesale supplier fails to comply with the renewable portfolio standards during the subject annual period. The electric distribution company shall promptly transfer any payment received from the wholesale supplier for the failure to meet the renewable portfolio standards to the Renewable Energy Investment Fund for the development of Class I renewable energy sources. Any payment made pursuant to this section shall not be considered revenue or income to the electric distribution company.

      (2) Notwithstanding the provisions of subsection (d) of this section regarding an alternative transitional standard offer option or an alternative standard service option, an electric distribution company providing transitional standard offer service, standard service, supplier of last resort service or back-up electric generation service in accordance with this section shall, not later than July 1, 2008, file with the Department of Public Utility Control for its approval one or more long-term power purchase contracts from Class I renewable energy source projects that receive funding from the Renewable Energy Investment Fund and that are not less than one megawatt in size, at a price that is either, at the determination of the project owner, (A) not more than the total of the comparable wholesale market price for generation plus five and one-half cents per kilowatt hour, or (B) fifty per cent of the wholesale market electricity cost at the point at which transmission lines intersect with each other or interface with the distribution system, plus the project cost of fuel indexed to natural gas futures contracts on the New York Mercantile Exchange at the natural gas pipeline interchange located in Vermillion Parish, Louisiana that serves as the delivery point for such futures contracts, plus the fuel delivery charge for transporting fuel to the project, plus five and one-half cents per kilowatt hour. In its approval of such contracts, the department shall give preference to purchase contracts from those projects that would provide a financial benefit to ratepayers or would enhance the reliability of the electric transmission system of the state. Such projects shall be located in this state. The owner of a fuel cell project principally manufactured in this state shall be allocated all available air emissions credits and tax credits attributable to the project and no less than fifty per cent of the energy credits in the Class I renewable energy credits program established in section 16-245a attributable to the project. On and after October 1, 2007, and until September 30, 2008, such contracts shall be comprised of not less than a total, apportioned among each electric distribution company, of one hundred twenty-five megawatts; and on and after October 1, 2008, such contracts shall be comprised of not less than a total, apportioned among each electrical distribution company, of one hundred fifty megawatts. The cost of such contracts and the administrative costs for the procurement of such contracts directly incurred shall be eligible for inclusion in the adjustment to the transitional standard offer as provided in this section and any subsequent rates for standard service, provided such contracts are for a period of time sufficient to provide financing for such projects, but not less than ten years, and are for projects which began operation on or after July 1, 2003. Except as provided in this subdivision, the amount from Class I renewable energy sources contracted under such contracts shall be applied to reduce the applicable Class I renewable energy source portfolio standards. For purposes of this subdivision, the department's determination of the comparable wholesale market price for generation shall be based upon a reasonable estimate. On or before September 1, 2007, the department, in consultation with the Office of Consumer Counsel and the Renewable Energy Investments Advisory Council, shall study the operation of such renewable energy contracts and report its findings and recommendations to the joint standing committee of the General Assembly having cognizance of matters relating to energy.

      (k) (1) As used in this section:

      (A) "Participating electric supplier" means an electric supplier that is licensed by the department to provide electric service, pursuant to this subsection, to residential or small commercial customers.

      (B) "Residential customer" means a customer who is eligible for standard service and who takes electric distribution-related service from an electric distribution company pursuant to a residential tariff.

      (C) "Small commercial customer" means a customer who is eligible for standard service and who takes electric distribution-related service from an electric distribution company pursuant to a small commercial tariff.

      (D) "Qualifying electric offer" means an offer to provide full requirements commodity electric service and all other generation-related service to a residential or small commercial customer at a fixed price per kilowatt hour for a term of no less than one year.

      (2) In the manner determined by the department, residential or small commercial service customers (A) initiating new utility service, (B) reinitiating service following a change of residence or business location, (C) making an inquiry regarding their utility rates, or (D) seeking information regarding energy efficiency shall be offered the option to learn about their ability to enroll with a participating electric supplier. Customers expressing an interest to learn about their electric supply options shall be informed of the qualifying electric offers then available from participating electric suppliers. The electric distribution companies shall describe then available qualifying electric offers through a method reviewed and approved by the department. The information conveyed to customers expressing an interest to learn about their electric supply options shall include, at a minimum, the price and term of the available electric supply option. Customers expressing an interest in a particular qualifying electric offer shall be immediately transferred to a call center operated by that participating electric supplier.

      (3) Not later than September 1, 2007, the department shall establish terms and conditions under which a participating electric supplier can be included in the referral program described in subdivision (2) of this subsection. Such terms shall include, but not be limited to, requiring participating electrical suppliers to offer time-of-use and real-time use rates to residential customers.

      (4) Each calendar quarter, participating electric suppliers shall be allowed to list qualifying offers to provide electric generation service to residential and small commercial customers with each customer's utility bill. The department shall determine the manner such information is presented in customers' utility bills.

      (5) Any customer that receives electric generation service from a participating electric supplier may return to standard service or may choose another participating electric supplier at any time, including during the qualifying electric offer, without the imposition of any additional charges. Any customer that is receiving electric generation service from an electric distribution company pursuant to standard service can switch to another participating electric supplier at any time without the imposition of additional charges.

      (l) Each electric distribution company shall offer to bill customers on behalf of participating electric suppliers and to pay such suppliers in a timely manner the amounts due such suppliers from customers for generation services, less a percentage of such amounts that reflects uncollectible bills and overdue payments as approved by the Department of Public Utility Control.

      (m) On or before July 1, 2007, the Department of Public Utility Control shall initiate a proceeding to examine whether electric supplier bills rendered pursuant to section 16-245d and any regulations adopted thereunder sufficiently enable customers to compare pricing policies and charges among electric suppliers.

      (n) Nothing in the provisions of this section shall preclude an electric distribution company from entering into standard service supply contracts or standard service supply components with electric generating facilities.

      (P.A. 98-28, S. 20, 117; P.A. 03-135, S. 4; 03-221, S. 3, 4; P.A. 04-236, S. 9; 04-247, S. 2; June Sp. Sess. P.A. 05-1, S. 25, 26, 33; P.A. 06-196, S. 233; P.A. 07-242, S. 49, 92, 124.)

      *Note: Public act 98-28 is entitled "An Act Concerning Electric Restructuring". (See Reference Table captioned "Public Acts of 1998" in Volume 16 of the General Statutes of Connecticut, revised to January 1, 2007, which lists the sections amended, created or repealed by the act.)

      Public act 03-135 is entitled "An Act Concerning Revisions to the Electric Restructuring Legislation". (See Reference Table captioned "Public Acts of 2003" in Volume 16 of the General Statutes of Connecticut, revised to January 1, 2007, which lists the sections amended, created or repealed by the act.


      History: P.A. 98-28 effective July 1, 1998; P.A. 03-135 made technical changes, deleted provision in Subsec. (a) re extension of the standard offer by the General Assembly, deleted former Subsec. (b) re service to customers on and after January 1, 2004, who do not or are unable to arrange for services, added new Subsec. (b) re transitional standard offer, added new Subsec. (c) re standard service, added new Subsec. (d) re alternative transitional standard offer and standard service, added new Subsec. (e) re supplier of last resort, redesignated existing Subsec. (c) as Subsec. (f) and amended said Subsec. to change "2003" to "2006" and "2004" to "2007" and to add "pursuant to a plan submitted by the electric distribution company and approved by the department", redesignated existing Subsec. (d) as Subsec. (g) and amended said Subsec. to add reference to transitional standard offer service, standard service, and supplier of last resort service and to delete reference to January 1, 2004, redesignated existing Subsec. (e) as Subsec. (h) and amended said Subsec. to delete reference to default service and back-up electrical generation services, to add reference to transitional standard offer service, standard service and back-up electric generation service and to change "2004" to "2007", redesignated existing Subsec. (f) as Subsec. (i) and amended said Subsec. to delete provision re standards or procedures for procuring power and competitive bidding, and added new Subsec. (j) re compliance with renewable portfolio standards and purchase of long-term power purchase contracts from Class I renewable energy source projects, effective July 1, 2003; P.A. 03-221 amended Subsec. (h) to make a technical change and amended Subsec. (j)(1) to revise provisions re contracting with suppliers to comply with the renewable portfolio standards, responsibility for payment for failure to meet such standards, and treatment of such payment, effective July 1, 2003; P.A. 04-236 amended Subsec. (b)(2)(E) to make a technical change, effective June 8, 2004; P.A. 04-247 amended Subsec. (j)(2) to add "for its approval", to add requirement for projects to be not less than one megawatt in size, and to add requirement for a preference for projects that provide financial benefit to ratepayers or enhance reliability of the electric transmission system; June Sp. Sess. P.A. 05-1 amended Subsec. (b)(1) to designate existing language as Subpara. (A) and to add new Subpara. (B) to require the department to conduct a proceeding re receipt of information to select electric generating services, and amended Subsec. (b)(2)(D) to allow the transitional standard offer to be adjusted to provide for the cost of long-term power purchase contracts from certain Class I projects, effective July 1, 2005, and amended Subsec. (j)(2) to change filing deadline from July 1, 2007, to July 1, 2008, to add a new pricing option, to require projects to be located in this state, to provide air emission and tax credits for certain fuel cell projects, to replace language re inclusion of costs of the contracts in the generation service charge with language re the transitional standard offer and standard service, and to make technical changes; P.A. 06-196 made technical changes in Subsec. (j)(2), effective June 7, 2006; P.A. 07-242 amended Subsec. (e)(1) to delete limitation on any customer receiving electric generation services from electric supplier being eligible to receive supplier of last resort service without a one-year commitment and amended Subsec. (e)(2) to require electric distribution companies to procure electricity "at least every calendar quarter", effective July 1, 2007, amended Subsec. (j)(2) to change total megawatts of contracts to not less than 125 megawatts on and after October 1, 2007, and until September 30, 2008, and to not less than 150 megawatts on and after October 1, 2008, and add provision re study, effective June 4, 2007, and added Subsecs. (k) to (n) re participating electric suppliers, effective July 1, 2007.

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      Sec. 16-244e. Unbundling by electric companies of generation functions from transmission and distribution functions. Plan. (a)(1) Not later than October 1, 1998, each electric company shall submit an unbundling plan to the department to unbundle and separate, by October 1, 1999, all the company's generation assets that (A) prior to the date when the department approves a divestiture plan pursuant to section 16-244f or 16-244g, are not sold in accordance with section 16-43, and (B) on and after the date when the department approves such plan, will not be divested as of January 1, 2000, in accordance with sections 16-244f and 16-244g.

      (2) For any nonnuclear generation asset that will not be divested by January 1, 2000, unbundling and separation shall occur by transfer on a functional basis to one or more corporate affiliates that are legally separate from the company's transmission and distribution assets and all related operations and functions, in which case, no stranded costs shall be recovered.

      (3) For any nuclear generation asset that will not be sold by January 1, 2000, unbundling and separation shall occur by (A) divestiture pursuant to section 16-244g, (B) transfer on a functional basis to one or more corporate affiliates that are legally separate from the company's transmission and distribution assets and all related operations and functions, or (C) if required to comply with rules, regulations or licensing requirements of the United States Nuclear Regulatory Commission, transfer on a functional basis to one or more divisions that are structurally separate from the electric distribution company.

      (4) The unbundling plan and order shall provide for the allocation of the rights and responsibilities pursuant to sections 16-245e to 16-245k, inclusive, between the electric distribution company and any generation entities or affiliates and shall provide for the allocation of revenue under a special contract among those components of a customer's bill specified in subdivision (1) of subsection (a) of section 16-245d. Such plan shall include a proposed modification or elimination to the adjustment pursuant to section 16-19b. Such plan shall not allow the transfer of assets or liabilities allocable or belonging to transmission or distribution functions or facilities to the generation entity or affiliate of an electric company, nor allow the transfer of assets or liabilities, other than financial assets or liabilities to be funded by the competitive transition assessment pursuant to section 16-245g or the systems benefits charge pursuant to section 16-245l, allocable or belonging to generation functions or facilities to the electric distribution company, as defined in section 16-1, unless federal law or regulation requires such a transfer with regard to nuclear generation assets. All entitlements and obligations from any purchased power contract or independent power producer contract entered into before July 1, 1998, by the predecessor electric company which are not bought out shall succeed to the electric distribution company. Such plan shall include a discussion of the impacts of the proposed plan on the company's employees and plans for mitigating such impact.

      (5) The department shall hold a hearing and issue a final order approving or modifying the plan in a time frame that will allow unbundling to be accomplished by October 1, 1999. Any hearing shall be conducted as a contested case in accordance with chapter 54. Such plan shall be submitted and such order issued consistent with the determination and implementation of the competitive transition assessment, as provided in section 16-245g.

      (6) Once unbundling is completed to the satisfaction of the department and consistent with the provisions of section 16-244, (A) any corporate affiliate or separate division that provides electric generation services as a result of unbundling pursuant to this subsection shall be considered a generation entity or affiliate of the electric company, and the division or corporate affiliate of the electric company that provides transmission and distribution services shall be considered an electric distribution company, and (B) an electric distribution company shall not own or operate generation assets, except as provided in this section and sections 16-43d, 16-243m, 16-243u, 16a-3b and 16a-3c.

      (b) Not later than August 1, 1998, the Department of Public Utility Control shall hold a hearing and issue a final order that unbundles prices or rates for electric generation services for each electric company from all other charges. Any hearing shall be conducted as a contested case in accordance with chapter 54. On and after July 1, 1999, each electric company or electric distribution company, as the case may be, shall provide all customers with a bill that separates the electric generation services component of those charges. Any unbundling of charges for electric generation services under this subsection shall not affect the calculation of base rates under section 16-244a.

      (P.A. 98-28, S. 5, 117; P.A. 03-135, S. 18; June Sp. Sess. P.A. 05-1, S. 4; P.A. 06-196, S. 234; P.A. 07-242, S. 63.)

      History: P.A. 98-28 effective July 1, 1998; P.A. 03-135 amended Subsec. (a)(6) to designate existing provisions as Subpara. (A) and to add Subpara. (B) re ownership or operation of generation assets by an electric distribution company, effective July 1, 2003; June Sp. Sess. P.A. 05-1 amended Subsec. (a)(6) to add an exception re generation of electricity by an electric distribution company, effective July 21, 2005; P.A. 06-196 made a technical change in Subsec. (a)(6), effective June 7, 2006; P.A. 07-242 amended Subsec. (a)(6) to add exceptions re generation of electricity by electric distribution company, effective July 1, 2007.

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      Sec. 16-245a. Renewable energy portfolio standards. (a) An electric supplier and an electric distribution company providing standard service or supplier of last resort service, pursuant to section 16-244c, shall demonstrate:

      (1) On and after January 1, 2006, that not less than two per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources;

      (2) On and after January 1, 2007, not less than three and one-half per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources;

      (3) On and after January 1, 2008, not less than five per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources;

      (4) On and after January 1, 2009, not less than six per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources;

      (5) On and after January 1, 2010, not less than seven per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources;

      (6) On and after January 1, 2011, not less than eight per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources;

      (7) On and after January 1, 2012, not less than nine per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources;

      (8) On and after January 1, 2013, not less than ten per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources;

      (9) On and after January 1, 2014, not less than eleven per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources;

      (10) On and after January 1, 2015, not less than twelve and one-half per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources;

      (11) On and after January 1, 2016, not less than fourteen per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources;

      (12) On and after January 1, 2017, not less than fifteen and one-half per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources;

      (13) On and after January 1, 2018, not less than seventeen per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources;

      (14) On and after January 1, 2019, not less than nineteen and one-half per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources;

      (15) On and after January 1, 2020, not less than twenty per cent of the total output or services of any such supplier or distribution company shall be generated from Class I renewable energy sources and an additional three per cent of the total output or services shall be from Class I or Class II renewable energy sources.

      (b) An electric supplier or electric distribution company may satisfy the requirements of this section (1) by purchasing certificates issued by the New England Power Pool Generation Information System, provided the certificates are for (A) energy produced by a generating unit using Class I or Class II renewable energy sources and the generating unit is located in the jurisdiction of the regional independent system operator, or (B) energy imported into the control area of the regional independent system operator pursuant to New England Power Pool Generation Information System Rule 2.7(c), as in effect on January 1, 2006; (2) for those renewable energy certificates under contract to serve end-use customers in the state on or before October 1, 2006, by participating in a renewable energy trading program within said jurisdictions as approved by the Department of Public Utility Control; or (3) by purchasing eligible renewable electricity and associated attributes from residential customers who are net producers.

      (c) Any supplier who provides electric generation services solely from a Class II renewable energy source shall not be required to comply with the provisions of this section.

      (d) An electric supplier or an electric distribution company shall base its demonstration of generation sources, as required under subsection (a) of this section on historical data, which may consist of data filed with the regional independent system operator.

      (e) (1) A supplier or an electric distribution company may make up any deficiency within its renewable energy portfolio within the first three months of the succeeding calendar year or as otherwise provided by generation information system operating rules approved by New England Power Pool or its successor to meet the generation source requirements of subsection (a) of this section for the previous year.

      (2) No such supplier or electric distribution company shall receive credit for the current calendar year for generation from Class I or Class II renewable energy sources pursuant to this section where such supplier or distribution company receives credit for the preceding calendar year pursuant to subdivision (1) of this subsection.

      (f) The department shall adopt regulations, in accordance with the provisions of chapter 54, to implement the provisions of this section.

      (g) (1) Notwithstanding the provisions of this section and section 16-244c, for periods beginning on and after January 1, 2008, each electric distribution company may procure renewable energy certificates from Class I, Class II and Class III renewable energy sources through long-term contracting mechanisms. The electric distribution companies may enter into long-term contracts for not more than fifteen years to procure such renewable energy certificates. The electric distribution companies shall use any renewable energy certificates obtained pursuant to this section to meet their standard service and supplier of last resort renewable portfolio standard requirements.

      (2) On or before July 1, 2007, the department shall initiate a contested case proceeding to examine whether long-term contracts should be used to procure Class I, Class II and Class III certificates. In such examination, the department shall determine (A) the impact of such contracts on price stability, fuel diversity and cost; (B) the method and timing of crediting of the procurement of renewable energy certificates against the renewable portfolio standard purchase obligations of electric suppliers and the electric distribution companies pursuant to subsection (a) of this section; (C) the terms and conditions, including reasonable performance assurance commitments, that may be imposed on entities seeking to supply renewable energy certificates; (D) the level of one-time compensation, not to exceed one mill per kilowatt hour of output and services associated with the renewable energy certificates purchased pursuant to this subsection, which may be payable to the electric distribution companies for administering the procurement provided for under this subsection and recovered as part of the generation services charge or through an appropriate nonbypassable rate component on customers' bills; (E) the manner in which costs for such program may be recovered from electric distribution company customers; and (F) any other issues the department deems appropriate. Revenues from such compensation shall not be included in calculating the electric distribution companies' earnings to determine if rates are just and reasonable, for earnings sharing mechanisms or for purposes of sections 16-19, 16-19a and 16-19e.

      (P.A. 98-28, S. 25, 117; P.A. 03-135, S. 7; June Sp. Sess. P.A. 05-1, S. 34; P.A. 06-74, S. 3; P.A. 07-242, S. 40, 71.)

      History: P.A. 98-28 effective July 1, 1998; P.A. 03-135 amended Subsec. (a) to delete provisions applicable before July 1, 2003, designate remaining provisions as Subdiv. (1), add provisions re applicability of section to electric suppliers and electric distribution companies providing transitional standard offer, standard service, and supplier of last resort service, adjust the percentage of Class I and Class II renewable energy source requirements and the dates for meeting such requirements, delete provision re participation in a renewable energy trading program approved by the state, reposition provision re generation solely from Class II renewable energy source as new Subdiv. (3) and add new Subdiv. (2) re qualifying jurisdictions, amended Subsec. (b) to add a reference to an electric supplier and an electric distribution company and to make conforming changes, added new Subsec. (c) re make up of any deficiency and credit for the current year where credit was received in a preceding year, redesignated former Subsec. (c) as Subsec. (d) and amended said Subsec. to change "may" to "shall" and to make technical changes, effective January 1, 2004; June Sp. Sess. P.A. 05-1 amended Subsec. (a)(2) to add "on and after January 1, 2010", effective July 1, 2006; P.A. 06-74 amended Subsec. (a) to make technical changes, redesignated existing Subsec. (a)(2) as new Subsec. (b), amended Subsec. (b) to replace language re certain qualifying jurisdictions with language in Subdiv. (1) re certificates issued by the New England Power Pool Generation Information System and in Subdiv. (2) re renewable energy certificates under contract on or before October 1, 2006, and to make technical changes, redesignated existing Subsec. (a)(3) as new Subsec. (c), and redesignated existing Subsecs. (b) to (d), inclusive, as new Subsecs. (d) to (f), inclusive; P.A. 07-242 amended Subsec. (a) to add Subdiv. designators (1) to (5) for existing renewable energy portfolio standard requirements through on and after January 1, 2010, and add Subdivs. (6) to (15) re standards through on and after January 1, 2020, and added Subsec. (b)(3) re purchasing renewable energy from residential net producers, and, effective June 4, 2007, added Subsec. (g) re long-term contracts.

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      Sec. 16-245e. Stranded costs of electric companies. Definitions. Calculation by department, procedures, adjustments. Mitigation. Defeasance or purchase of rate reduction bonds. (a) As used in this section and sections 16-245f to 16-245k, inclusive:

      (1) "Rate reduction bonds" means bonds, notes, certificates of participation or beneficial interest, or other evidences of indebtedness or ownership, issued pursuant to an executed indenture or other agreement of a financing entity, in accordance with this section and sections 16-245f to 16-245k, inclusive, the proceeds of which are used, directly or indirectly, to provide, recover, finance, or refinance stranded costs or to sustain funding of conservation and load management and renewable energy investment programs by substituting for disbursements to the General Fund from the Energy Conservation and Load Management Fund established by section 16-245m and from the Renewable Energy Investment Fund established by section 16-245n, and which, directly or indirectly, are secured by, evidence ownership interests in, or are payable from, transition property;

      (2) "Competitive transition assessment" means those non-bypassable rates and other charges, that are authorized by the department (A) in a financing order to sustain funding of conservation and load management and renewable energy investment programs by substituting disbursements to the General Fund from proceeds of rate reduction bonds for such disbursements from the Energy Conservation and Load Management Fund established by section 16-245m and from the Renewable Energy Investment Fund established by section 16-245n, or to recover those stranded costs that are eligible to be funded with the proceeds of rate reduction bonds pursuant to section 16-245f and the costs of providing, recovering, financing, or refinancing such substitution of disbursements to the General Fund or such stranded costs through a plan approved by the department in the financing order, including the costs of issuing, servicing, and retiring rate reduction bonds, (B) to recover those stranded costs determined under this section but not eligible to be funded with the proceeds of rate reduction bonds pursuant to section 16-245f, or (C) to recover costs determined under subdivision (1) of subsection (e) of section 16-244g. If requested by the electric company or electric distribution company, the department shall include in the competitive transition assessment non-bypassable rates and other charges to recover federal and state taxes whose recovery period is modified by the transactions contemplated in this section and sections 16-245f to 16-245k, inclusive;

      (3) "Customer" means any individual, business, firm, corporation, association, tax-exempt organization, joint stock association, trust, partnership, limited liability company, the United States or its agencies, this state, any political subdivision thereof or state agency that purchases electric generation or distribution services as a retail end user in the state from any electric supplier, electric company or electric distribution company;

      (4) "Finance authority" means the state, acting through the office of the State Treasurer;

      (5) "Net proceeds" means "net proceeds" as defined in section 16-244f;

      (6) "Stranded costs" means that portion of generation assets, generation-related regulatory assets or long-term contract costs determined by the department in accordance with the provisions of subsections (e), (f), (g) and (h) of this section;

      (7) "Generation assets" means the total construction and other capital asset costs of generation facilities approved for inclusion in rates before July 1, 1997, but does not include any costs relating to the decommissioning of any such facility or any costs which the department found during a proceeding initiated before July 1, 1998, were incurred because of imprudent management;

      (8) "Generation-related regulatory assets" means generation-related costs authorized or mandated before July 1, 1998, by the Department of Public Utility Control, approved for inclusion in the rates, and include, but are not limited to, costs incurred for deferred taxes, conservation programs, environmental protection programs, public policy costs and research and development costs, net of any applicable credits payable to customers, but does not include any costs which the department found during a proceeding initiated before July 1, 1998, were incurred because of imprudent management;

      (9) "Long-term contract costs" mean the above-market portion of the costs of contractual obligations approved for inclusion in the rates that were entered into before January 1, 2000, arising from independent power producer contracts required by law or purchased power contracts approved by the Federal Energy Regulatory Commission;

      (10) "Department" means the Department of Public Utility Control;

      (11) "Financing entity" means the finance authority or any special purpose trust or other entity that is authorized by the finance authority to issue rate reduction bonds or acquire transition property pursuant to such terms and conditions as the finance authority may specify, or both;

      (12) "Financing order" means an order of the department adopted in accordance with this section and sections 16-245f to 16-245k, inclusive;

      (13) "Transition property" means the property right created pursuant to this section and sections 16-245f to 16-245k, inclusive, in respect of disbursements to the General Fund to sustain funding of conservation and load management and renewable energy investment programs or those stranded costs that are eligible to be funded with the proceeds of rate reduction bonds pursuant to section 16-245f, including, without limitation, the right, title, and interest of an electric company or electric distribution company or its transferee or the financing entity (A) in and to the rates and charges established pursuant to a financing order, as adjusted from time to time in accordance with subdivision (2) of subsection (b) of section 16-245i and the financing order, (B) to be paid the amount that is determined in a financing order to be the amount that the electric company or electric distribution company or its transferee or the financing entity is lawfully entitled to receive pursuant to the provisions of this section and sections 16-245f to 16-245k, inclusive, and the proceeds thereof, and in and to all revenues, collections, claims, payments, money, or proceeds of or arising from the rates and charges or constituting the competitive transition assessment that is the subject of a financing order including those non-bypassable rates and other charges referred to in subdivision (2) of this subsection, and (C) in and to all rights to obtain adjustments to the rates and charges pursuant to the terms of subdivision (2) of subsection (b) of section 16-245i and the financing order. "Transition property" shall constitute a current property right notwithstanding the fact that the value of the property right will depend on consumers using electricity or, in those instances where consumers are customers of a particular electric company or electric distribution company, the electric company or electric distribution company performing certain services;

      (14) "State rate reduction bonds" means the rate reduction bonds issued on June 23, 2004, by the state to sustain funding of conservation and load management and renewable energy investment programs by substituting for disbursements to the General Fund from the Energy Conservation and Load Management Fund, established by section 16-245m, and from the Renewable Energy Investment Fund, established by section 16-245n. The state rate reduction bonds for the purposes of section 4-30a shall be deemed to be outstanding indebtedness of the state;

      (15) "Operating expenses" means, with respect to state rate reduction bonds, (A) all expenses, costs and liabilities of the state or the trustee incurred in connection with the administration or payment of the state rate reduction bonds or in discharge of its obligations and duties under the state rate reduction bonds or bond documents, expenses and other costs and expenses arising in connection with the state rate reduction bonds or pursuant to the financing order providing for the issuance of such bonds including any arbitrage rebate and penalties payable under the code in connection with such bonds, and (B) all fees and expenses payable or disbursable to the servicers or others under the bond documents;

      (16) "Bond documents" means, with respect to state rate reduction bonds, the following documents: The servicing agreements, the tax compliance agreement and certificate, and the continuing disclosure agreement entered into in connection with the state rate reduction bonds and the indenture;

      (17) "Indenture" means, with respect to state rate reduction bonds, the RRB Indenture, dated as of June 23, 2004, by and between the state and the trustee, as amended from time to time; and

      (18) "Trustee" means, with respect to state rate reduction bonds, the trustee appointed under the indenture.

      (b) The department shall, in accordance with the provisions of this section, identify and calculate, upon application by an electric company, those stranded costs that may be collected through the competitive transition assessment which shall be calculated and collected in accordance with the provisions of section 16-245g. No electric distribution company shall be eligible to claim stranded costs unless a public auction has been held to divest itself of all nonnuclear generation assets in accordance with subsection (b) of section 16-244f or the electric company has sold its nonnuclear generation assets in accordance with section 16-43.

      (c) (1) Notwithstanding subdivision (1) of subsection (e) of section 16-244g, any electric company seeking to claim stranded costs shall, in accordance with this subsection, mitigate such costs to the fullest extent possible. Prior to the approval by the department of any stranded costs, the electric company shall show to the satisfaction of the department that the electric company has taken all reasonable steps to mitigate to the maximum extent possible the total amount of stranded costs that it seeks to claim and to minimize the cost to be recovered from customers. Mitigation shall include: (A) Except to the extent provided in collective bargaining agreements or agreements to purchase generation assets entered into prior to July 1, 1998, the obtaining of written commitments from purchasers of generation facilities divested pursuant to sections 16-244f and 16-244g, that the purchasers will offer employment to persons who were employed in nonmanagerial positions by a divested generation facility at any time during the three-month period prior to the divestiture, at levels of wages and overall compensation not lower than the employees' lowest level during the six-month period prior to the date the contract to divest the asset was entered into; (B) good faith efforts to negotiate the buyout, buydown or renegotiation of independent power producer contracts and purchased power contracts approved by the Federal Energy Regulatory Commission provided the fixed present value of any contract to which a political subdivision of the state is a party shall be calculated using the political subdivision's tax-exempt borrowing rate as the discount rate; and (C) the reasonable costs of the consultants appointed to conduct the auctions of generation assets pursuant to sections 16-244f and 16-244g. Mitigation may include, but is not limited to, reallocation of depreciation reserves to existing generation assets to the extent consistent with generally accepted accounting principles; reduction of book assets by application of net proceeds of any sale of existing assets; maximization of market revenues from existing generation assets; efforts to maximize current and future operating efficiency, including appropriate and timely maintenance, trouble shooting, aggressive identification and correction of potential problem areas; voluntary write-offs of above-market generation assets; the decision to retire uneconomical generation assets and efforts to divest generating sites at market prices reflective of best use of sites. Mitigation shall not include any expenditures to restart a nuclear generation asset that was not operating for reasons other than scheduled maintenance or refueling at the time such expenditure was made. Any mitigation efforts and associated costs shall be subject to approval by the department.

      (2) The department shall allow the cost of such mitigation efforts to be included in the calculation of stranded costs to the extent that such mitigation costs are reasonable relative to the amount of the reduction in stranded costs resulting from the mitigation.

      (d) An electric company shall submit to the department an application for recovery of that portion of generation-related regulatory assets, long-term contract costs, generation assets and mitigation costs which are determined by the department in accordance with subsections (c), (e), (f) and (g) of this section and subdivision (1) of subsection (e) of section 16-244g. The application shall include a description of mitigation efforts and a request for recovery through the competitive transition assessment and may include a request for a financing order. The department shall hold a hearing for each electric company and issue a finding of the calculation of stranded costs in a time frame that allows for collection of the competitive transition assessment to begin on January 1, 2000. Any hearing shall be conducted as a contested case in accordance with chapter 54.

      (e) The department shall calculate the stranded costs for generation-related regulatory assets to be their book value as of January 1, 2000. In calculating the value of generation-related regulatory assets that are being provided in a lump sum as the result of a funding with the proceeds of rate reduction bonds, the department shall adjust the value of each such asset to reflect the time value of such lump sum, if any.

      (f) (1) The department shall calculate the stranded costs for long-term contract costs that have been reduced to a fixed present value through the buyout, buydown, or renegotiation of independent power producer contracts and purchased power contracts approved by the Federal Energy Regulatory Commission as such present value. In making such calculation, the department shall net purchased power contracts approved by the Federal Energy Regulatory Commission that are below market value against any such contracts that are above-market value.

      (2) The department shall calculate the stranded costs for any portion of a long-term contract cost that has not been reduced to a fixed present value by comparing the contract price to the market price at least annually. In making such calculation, the department shall net purchased power contracts approved by the Federal Energy Regulatory Commission that are below market value against any such contracts that are above-market value. The costs described in this subdivision shall be included in the competitive transition assessment pursuant to section 16-245g but shall not be included in any funding with the proceeds of rate reduction bonds.

      (g) The department shall calculate the stranded cost for each generation asset described in subdivision (7) of subsection (b) of section 16-244f to be the difference between its book value and the market value of a prudently and efficiently managed nonnuclear generating facility of comparable size, age and technical characteristics in a competitive market. In determining the market value of any such asset, the department may consider (A) the dollars per kilowatt received from the sale of similar generation facilities, if any, (B) income capitalization based on the operating history and capacity of the facility, the market rates for power, and any existing long-term contracts for the sale of power or capacity, (C) independent market appraisals, or (D) other relevant factors. The department shall calculate the stranded costs for generation assets described in subdivision (7) of subsection (b) of section 16-244f at least every three years. The costs described in this subsection shall be included in the competitive transition assessment pursuant to section 16-245g but shall not be included in any funding with the proceeds of rate reduction bonds.

      (h) (1) On or before January 1, 2004, an electric company may submit to the department an application for recovery of that portion of nuclear generation assets which is determined by the department in accordance with this subsection, which application shall include a request for recovery through the competitive transition assessment. The department shall hold a hearing for each electric company and issue a finding of the calculation of such nuclear generation assets in accordance with the provisions of this subsection. Any hearing shall be conducted as a contested case proceeding in accordance with chapter 54. The costs described in this subsection shall be included in the competitive transition assessment pursuant to section 16-245g but shall not be included in any funding with proceeds of rate reduction bonds.

      (2) The department shall calculate the stranded costs for each nuclear generation asset that was divested at a price less than book value as described in subdivision (5) of subsection (c) of section 16-244g as the difference between the book value of this asset and the final bid price of the asset. The department's calculation of stranded costs pursuant to this subdivision shall be final and shall not be subject to further adjustment by the department.

      (3) The department shall calculate the stranded costs for each nondivested nuclear generation asset described in subdivision (1) of subsection (d) of section 16-244g to be the difference between its book value and the market value of a prudently and efficiently managed nuclear generating facility of comparable size, age and technical characteristics in a competitive market. In determining the market value of any such asset, the department may consider (A) the dollars per kilowatt received from the sale of similar generation facilities, if any, (B) income capitalization based on the operating history and capacity of the facility, the market rates for power, and any existing long-term contracts for the sale of power or capacity, (C) the provision for decommissioning and related costs to be paid from the systems benefits charge provided in section 16-245l, (D) independent market appraisals, or (E) other relevant factors. At least every four years after the date when the department issues an initial finding of the calculation of the stranded costs for such nondivested nuclear generation assets as provided in this subdivision until the earlier of (i) the expiration of the collection of the competitive transition assessment, or (ii) the date when such an asset is divested, the department shall hold a hearing and issue a finding to adjust the stranded cost calculation of each such asset and to adjust the competitive transition assessment accordingly to true up the stranded cost recovery for the difference between the market value projected in such initial finding and the actual market value of a prudently and efficiently managed nuclear generating facility of comparable size, age and technical characteristics during the time period between the initial finding and the adjustment date, provided the second and subsequent adjustments shall reflect the difference during the time period since the most recent true-up. The department shall calculate the value of each such asset in accordance with the methodology provided in this subdivision. Any hearing shall be conducted as a contested case in accordance with chapter 54.

      (4) After the department has calculated the total value of stranded costs for all nuclear generation assets, the department shall (A) reduce such amount by the net proceeds that are above book value realized by an electric company from the sale of nonnuclear generation assets pursuant to subdivision (6) of subsection (b) of section 16-244f, (B) reduce such valuation to reflect the total net proceeds that are above book value realized by an electric distribution company from the sale of any nuclear generation assets pursuant to subsection (c) of section 16-244g, and (C) reduce such amount by the net proceeds that are above book value received by an electric company for the sale or lease of any real property after July 1, 1998.

      (i) If any net proceeds described in subdivision (4) of subsection (h) of this section remain after the reduction in the calculation of nuclear generation assets pursuant to said subdivision (4) or are realized after said reduction is calculated, the additional amount of such net proceeds shall be netted against long-term contract costs described in subdivision (2) of subsection (f) of this section, and the competitive transition assessment shall be adjusted accordingly.

      (j) (1) No electric company shall be eligible to claim any stranded costs for a nuclear generation asset or for any generation-related regulatory asset related to such generation asset, if the generation asset is not operating as a result of an order issued by the United States Nuclear Regulatory Commission that applies specifically to such asset. Any such asset that is not eligible to be claimed as a stranded cost shall be eligible after it is permitted to and has resumed operation and is selling power.

      (2) Any asset with a Nuclear Regulatory Commission capacity rating of 641 megawatts that does not resume operation after such order is no longer in effect shall not be eligible to be claimed as a stranded cost. An electric company or electric distribution company may apply to the department for retirement of such unit for economic reasons pursuant to section 16-19. The department shall include any recovery ordered in such proceeding in the competitive transition assessment but shall not include any costs relating to the decommissioning of any such facility or any costs which the department found during a proceeding initiated before July 1, 1998, were incurred because of imprudent management. Notwithstanding the provisions of this subdivision, nothing herein shall modify or supersede any statute or regulation in effect on July 1, 1998, pertaining to applications for retirement of nuclear generating facilities.

      (k) If an electric company elected to transfer any of its nuclear generation assets and related operations and functions to a separate corporate affiliate or to a division that is functionally separate from the electric distribution company pursuant to section 16-244g and subsequently sold any such assets in an arm's length transaction to an unrelated entity prior to January 1, 2012, the net proceeds realized from such sale that exceed book value for such assets shall be netted against the total amount of stranded costs, and the competitive transition assessment shall be adjusted accordingly and, if appropriate, other reimbursement shall be ordered by the department.

      (l) Funds appropriated to the Treasurer in section 21 of public act 07-1 of the June special session* shall be used by the Treasurer for the purpose of (1) defeasing some or all of the state rate reduction bonds maturing after December 30, 2007, by irrevocably depositing with the bond trustee in trust such appropriation to be used for the scheduled payments of principal and interest on the said state rate reduction bonds and paying operating expenses, (2) purchasing state rate reduction bonds maturing after December 30, 2007, in the open market on such terms and conditions as the Treasurer determines to be in the best interest of the state for purposes of satisfying such bonds, or (3) defeasing or satisfying some or all of the state rate reduction bonds maturing after December 30, 2007, by a combination of the methods described in subdivisions (1) and (2) of this subsection. Such appropriation is for the purpose of paying debt service on bonds or other evidences of indebtedness and related costs and expenses provided for in the indenture. After the defeasance or satisfaction of all outstanding state rate reduction bonds, the trustee shall deliver to the Treasurer or apply in accordance with the instructions of the Treasurer all moneys held by it not necessary to defease or satisfy such bonds or allocated to pay operating expenses. Such funds shall be first applied to satisfy any unpaid operating expenses. After payment of the operating expenses, seventy-five per cent of any remaining amounts shall be paid to the Energy Conservation and Load Management Fund, established pursuant to section 16-245m, and twenty-five per cent of such remaining amount shall be paid to the Renewable Energy Investment Fund, established pursuant to section 16-245n. The Treasurer and the finance authority have the authority to take any necessary and appropriate actions to implement the defeasance or satisfaction of the state rate reduction bonds and the payment of all operating expenses so that the amount of state rate reduction charges which before defeasance secured the state rate reduction bonds can be applied to the Energy Conservation and Load Management Fund and the Renewable Energy Investment Fund.

      (P.A. 98-28, S. 8, 117; June 30 Sp. Sess. P.A. 03-6, S. 44, 45; Sept. 8 Sp. Sess. P.A. 03-1, S. 2; P.A. 07-242, S. 79; June Sp. Sess. P.A. 07-1, S. 134; June Sp. Sess. P.A. 07-5, S. 56.)

      *Note: Section 21 of public act 07-1 of the June special session is special in nature and therefore has not been codified but remains in full force and effect according to its terms.


      History: P.A. 98-28 effective July 1, 1998; June 30 Sp. Sess. P.A. 03-6 amended Subsec. (a)(1), (2) and (13) re the definitions of "rate reduction bonds", "competitive transition assessment" and "transition property" for consistency with a plan to avoid disbursements from the Energy Conservation and Load Management and Renewable Energy Investment funds to the General Fund in the implementation of the budget for the biennium ending June 30, 2005, effective August 20, 2003; Sept. 8 Sp. Sess. P.A. 03-1 amended Subsec. (a)(13) re the definition of "transition property" to add references to the financing entity, effective September 10, 2003; P.A. 07-242 added Subsec.(a)(14) to (18) to define "state rate reduction bonds", "operating expenses", "bond documents", "indenture", and "trustee", respectively, effective June 4, 2007; June Sp. Sess. P.A. 07-1 added Subsec. (l) re defeasance or purchase of state rate reduction bonds, effective June 26, 2007; June Sp. Sess. P.A. 07-5 reiterated addition of Subsec. (a)(14) to (18) defining "state rate reduction bonds", "operating expenses", "bond documents", "indenture", and "trustee", respectively, effective October 6, 2007.

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      Sec. 16-245l. Systems benefits charge. Determination by department of amount and how applied to customers. (a) The Department of Public Utility Control shall establish and each electric distribution company shall collect a systems benefits charge to be imposed against all end use customers of each electric distribution company beginning January 1, 2000. The department shall hold a hearing that shall be conducted as a contested case in accordance with chapter 54 to establish the amount of the systems benefits charge. The department may revise the systems benefits charge or any element of said charge as the need arises. The systems benefits charge shall be used to fund (1) the expenses of the public education outreach program developed under subsections (a), (f) and (g) of section 16-244d other than expenses for department staff, (2) the reasonable and proper expenses of the education outreach consultant pursuant to subsection (d) of section 16-244d, (3) the cost of hardship protection measures under sections 16-262c and 16-262d and other hardship protections, including, but not limited to, electric service bill payment programs, funding and technical support for energy assistance, fuel bank and weatherization programs and weatherization services, (4) the payment program to offset tax losses described in section 12-94d, (5) any sums paid to a resource recovery authority pursuant to subsection (b) of section 16-243e, (6) low income conservation programs approved by the Department of Public Utility Control, (7) displaced worker protection costs, (8) unfunded storage and disposal costs for spent nuclear fuel generated before January 1, 2000, approved by the appropriate regulatory agencies, (9) postretirement safe shutdown and site protection costs that are incurred in preparation for decommissioning, (10) decommissioning fund contributions, (11) the costs of temporary electric generation facilities incurred pursuant to section 16-19ss, (12) operating expenses for the Connecticut Energy Advisory Board, (13) costs associated with the Connecticut electric efficiency partner program established pursuant to section 16-243v, (14) reinvestments and investments in energy efficiency programs and technologies pursuant to section 16a-38l, costs associated with the electricity conservation incentive program established pursuant to section 119 of public act 07-242*, and (15) legal, appraisal and purchase costs of a conservation or land use restriction and other related costs as the department in its discretion deems appropriate, incurred by a municipality on or before January 1, 2000, to ensure the environmental, recreational and scenic preservation of any reservoir located within this state created by a pump storage hydroelectric generating facility. As used in this subsection, "displaced worker protection costs" means the reasonable costs incurred, prior to January 1, 2008, (A) by an electric supplier, exempt wholesale generator, electric company, an operator of a nuclear power generating facility in this state or a generation entity or affiliate arising from the dislocation of any employee other than an officer, provided such dislocation is a result of (i) restructuring of the electric generation market and such dislocation occurs on or after July 1, 1998, or (ii) the closing of a Title IV source or an exempt wholesale generator, as defined in 15 USC 79z-5a, on or after January 1, 2004, as a result of such source's failure to meet requirements imposed as a result of sections 22a-197 and 22a-198 and this section or those Regulations of Connecticut State Agencies adopted by the Department of Environmental Protection, as amended from time to time, in accordance with Executive Order Number 19, issued on May 17, 2000, and provided further such costs result from either the execution of agreements reached through collective bargaining for union employees or from the company's or entity's or affiliate's programs and policies for nonunion employees, and (B) by an electric distribution company or an exempt wholesale generator arising from the retraining of a former employee of an unaffiliated exempt wholesale generator, which employee was involuntarily dislocated on or after January 1, 2004, from such wholesale generator, except for cause. "Displaced worker protection costs" includes costs incurred or projected for severance, retraining, early retirement, outplacement, coverage for surviving spouse insurance benefits and related expenses. "Displaced worker protection costs" does not include those costs included in determining a tax credit pursuant to section 12-217bb.

      (b) The amount of the systems benefits charge shall be determined by the department in a general and equitable manner and shall be imposed on all end use customers of each electric distribution company at a rate that is applied equally to all customers of the same class in accordance with methods of allocation in effect on July 1, 1998, provided the system benefits charge shall not be imposed on customers receiving services under a special contract which is in effect on July 1, 1998, until such special contracts expire. The system benefits charge shall be imposed beginning on January 1, 2000, on all customers receiving services under a special contract which are entered into or renewed after July 1, 1998. The systems benefits charge shall have a generally applicable manner of determination that may be measured on the basis of percentages of total costs of retail sales of generation services. The systems benefits charge shall be payable on an equal basis on the same payment terms and shall be eligible or subject to prepayment on an equal basis. Any exemption of the systems benefits charge by customers under a special contract shall not result in an increase in rates to any customer.

      (P.A. 98-28, S. 18, 117; P.A. 99-17, S. 1, 2; P.A. 02-64, S. 3; P.A. 03-135, S. 8; 03-140, S. 14; P.A. 04-236, S. 17, 18; 04-247, S. 1; P.A. 05-288, S. 220; P.A. 07-242, S. 13.)

      *Note: Section 119 of public act 07-242 is special in nature and therefore has not been codified but remains in full force and effect according to its terms.


      History: P.A. 98-28 effective July 1, 1998; P.A. 99-17 amended Subsec. (a) by adding new Subdiv. (11) re costs of conservation or land use restriction, effective May 12, 1999 (Revisor's note: In Subdiv. (11) of Subsec. (a), "... department it its discretion ..." was changed editorially by the Revisors to "... department in its discretion ..." for accuracy); P.A. 02-64 amended Subsec. (a) by redefining "displaced worker protection costs" to change "costs incurred prior to January 1, 2006," to "costs incurred prior to January 1, 2008," to add electric suppliers and exempt wholesale generators, to include reasonable costs associated with the dislocation of an employee that is the result of the closing of a Title IV source or exempt wholesale generator due to the source's failure to meet sulfur dioxide emission requirements and to make technical changes, effective January 1, 2004; P.A. 03-135 amended Subsec. (a) to add reference to Subsecs. (f) and (g) of Sec. 16-244d in Subdiv. (1), to add new Subdiv. (11) re the costs of temporary electric generation facilities, to redesignate existing Subdiv. (11) as Subdiv. (12), and to add "an operator of a nuclear power generating facility in this state or" and "coverage for surviving spouse insurance benefits" to the definition of "displaced worker protection costs", effective January 1, 2004; P.A. 03-140 amended Subsec. (a) to add "operating expenses for the Connecticut Energy Advisory Board", effective July 1, 2003, until January 1, 2004; P.A. 04-236 amended Subsec. (a) to make a technical change, effective June 8, 2004; P.A. 04-247 amended Subsec. (a) to make technical changes and add certain costs of retraining certain former employees of an unaffiliated exempt wholesale generator in definition of "displaced worker protection costs", effective June 3, 2004; P.A. 05-288 made technical changes in Subsec. (a), effective July 13, 2005; P.A. 07-242 added new Subsec. (a)(13) re partner program and Subsec. (a)(14) re energy efficiency and electricity conservation and redesignated existing Subsec. (a)(13) as Subsec. (a)(15), effective June 4, 2007.

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      Sec. 16-245m. Conservation and load management program; charge assessed against electric customers to fund program; scope and purpose of program. Deposit of certain moneys from the Energy Conservation and Load Management Funds in General Fund. (a)(1) On and after January 1, 2000, the Department of Public Utility Control shall assess or cause to be assessed a charge of three mills per kilowatt hour of electricity sold to each end use customer of an electric distribution company to be used to implement the program as provided in this section for conservation and load management programs but not for the amortization of costs incurred prior to July 1, 1997, for such conservation and load management programs.

      (2) Notwithstanding the provisions of this section, receipts from such charge shall be disbursed to the resources of the General Fund during the period from July 1, 2003, to June 30, 2005, unless the department shall, on or before October 30, 2003, issue a financing order for each affected electric distribution company in accordance with sections 16-245e to 16-245k, inclusive, to sustain funding of conservation and load management programs by substituting an equivalent amount, as determined by the department in such financing order, of proceeds of rate reduction bonds for disbursement to the resources of the General Fund during the period from July 1, 2003, to June 30, 2005. The department may authorize in such financing order the issuance of rate reduction bonds that substitute for disbursement to the General Fund for receipts of both the charge under this subsection and under subsection (b) of section 16-245n and also may, in its discretion, authorize the issuance of rate reduction bonds under this subsection and subsection (b) of section 16-245n that relate to more than one electric distribution company. The department shall, in such financing order or other appropriate order, offset any increase in the competitive transition assessment necessary to pay principal, premium, if any, interest and expenses of the issuance of such rate reduction bonds by making an equivalent reduction to the charge imposed under this subsection, provided any failure to offset all or any portion of such increase in the competitive transition assessment shall not affect the need to implement the full amount of such increase as required by this subsection and by sections 16-245e to 16-245k, inclusive. Such financing order shall also provide if the rate reduction bonds are not issued, any unrecovered funds expended and committed by the electric distribution companies for conservation and load management programs, provided such expenditures were approved by the department after August 20, 2003, and prior to the date of determination that the rate reduction bonds cannot be issued, shall be recovered by the companies from their respective competitive transition assessment or systems benefits charge but such expenditures shall not exceed four million dollars per month. All receipts from the remaining charge imposed under this subsection, after reduction of such charge to offset the increase in the competitive transition assessment as provided in this subsection, shall be disbursed to the Energy Conservation and Load Management Fund commencing as of July 1, 2003. Any increase in the competitive transition assessment or decrease in the conservation and load management component of an electric distribution company's rates resulting from the issuance of or obligations under rate reduction bonds shall be included as rate adjustments on customer bills.

      (b) The electric distribution company shall establish an Energy Conservation and Load Management Fund which shall be held separate and apart from all other funds or accounts. Receipts from the charge imposed under subsection (a) of this section shall be deposited into the fund. Any balance remaining in the fund at the end of any fiscal year shall be carried forward in the fiscal year next succeeding. Disbursements from the fund by electric distribution companies to carry out the plan developed under subsection (d) of this section shall be authorized by the Department of Public Utility Control upon its approval of such plan.

      (c) The Department of Public Utility Control shall appoint and convene an Energy Conservation Management Board which shall include representatives of: (1) An environmental group knowledgeable in energy conservation program collaboratives; (2) the Office of Consumer Counsel; (3) the Attorney General; (4) the Department of Environmental Protection; (5) the electric distribution companies in whose territories the activities take place for such programs; (6) a state-wide manufacturing association; (7) a chamber of commerce; (8) a state-wide business association; (9) a state-wide retail organization; (10) a representative of a municipal electric energy cooperative created pursuant to chapter 101a; (11) two representatives selected by the gas companies in this state; and (12) residential customers. Such members shall serve for a period of five years and may be reappointed. Representatives of the gas companies shall not vote on matters unrelated to gas conservation. Representatives of the electric distribution companies and the municipal electric energy cooperative shall not vote on matters unrelated to electricity conservation.

      (d) (1) The Energy Conservation Management Board shall advise and assist the electric distribution companies in the development and implementation of a comprehensive plan, which plan shall be approved by the Department of Public Utility Control, to implement cost-effective energy conservation programs and market transformation initiatives. Each program contained in the plan shall be reviewed by the electric distribution company and either accepted or rejected by the Energy Conservation Management Board prior to submission to the department for approval. The Energy Conservation Management Board shall, as part of its review, examine opportunities to offer joint programs providing similar efficiency measures that save more than one fuel resource or otherwise to coordinate programs targeted at saving more than one fuel resource. Any costs for joint programs shall be allocated equitably among the conservation programs. The Energy Conservation Management Board shall give preference to projects that maximize the reduction of federally mandated congestion charges. The Department of Public Utility Control shall, in an uncontested proceeding during which the department may hold a public hearing, approve, modify or reject the comprehensive plan prepared pursuant to this subsection.

      (2) There shall be a joint committee of the Energy Conservation Management Board and the Renewable Energy Investments Board. The board and the advisory committee shall each appoint members to such joint committee. The joint committee shall examine opportunities to coordinate the programs and activities funded by the Renewable Energy Investment Fund pursuant to section 16-245n with the programs and activities contained in the plan developed under this subsection to reduce the long-term cost, environmental impacts and security risks of energy in the state. Such joint committee shall hold its first meeting on or before August 1, 2005.

      (3) Programs included in the plan developed under subdivision (1) of this subsection shall be screened through cost-effectiveness testing which compares the value and payback period of program benefits to program costs to ensure that programs are designed to obtain energy savings and system benefits, including mitigation of federally mandated congestion charges, whose value is greater than the costs of the programs. Cost-effectiveness testing shall utilize available information obtained from real-time monitoring systems to ensure accurate validation and verification of energy use. Such testing shall include an analysis of the effects of investments on increasing the state's load factor. Program cost-effectiveness shall be reviewed annually, or otherwise as is practicable. If a program is determined to fail the cost-effectiveness test as part of the review process, it shall either be modified to meet the test or shall be terminated. On or before March 1, 2005, and on or before March first annually thereafter, the board shall provide a report, in accordance with the provisions of section 11-4a, to the joint standing committees of the General Assembly having cognizance of matters relating to energy and the environment (A) that documents expenditures and fund balances and evaluates the cost-effectiveness of such programs conducted in the preceding year, and (B) that documents the extent to and manner in which the programs of such board collaborated and cooperated with programs, established under section 7-233y, of municipal electric energy cooperatives. To maximize the reduction of federally mandated congestion charges, programs in the plan may allow for disproportionate allocations between the amount of contributions to the Energy Conservation and Load Management Funds by a certain rate class and the programs that benefit such a rate class. Before conducting such evaluation, the board shall consult with the Renewable Energy Investments Board. The report shall include a description of the activities undertaken during the reporting period jointly or in collaboration with the Renewable Energy Investment Fund established pursuant to subsection (c) of section 16-245n.

      (4) Programs included in the plan developed under subdivision (1) of this subsection may include, but not be limited to: (A) Conservation and load management programs, including programs that benefit low-income individuals; (B) research, development and commercialization of products or processes which are more energy-efficient than those generally available; (C) development of markets for such products and processes; (D) support for energy use assessment, real-time monitoring systems, engineering studies and services related to new construction or major building renovation; (E) the design, manufacture, commercialization and purchase of energy-efficient appliances and heating, air conditioning and lighting devices; (F) program planning and evaluation; (G) indoor air quality programs relating to energy conservation; (H) joint fuel conservation initiatives programs targeted at reducing consumption of more than one fuel resource; (I) public education regarding conservation; and (J) the demand-side technology programs recommended by the procurement plan approved by the Department of Public Utility Control pursuant to section 16a-3a. Such support may be by direct funding, manufacturers' rebates, sale price and loan subsidies, leases and promotional and educational activities. The plan shall also provide for expenditures by the Energy Conservation Management Board for the retention of expert consultants and reasonable administrative costs provided such consultants shall not be employed by, or have any contractual relationship with, an electric distribution company. Such costs shall not exceed five per cent of the total revenue collected from the assessment.

      (e) Notwithstanding the provisions of subsections (a) to (d), inclusive, of this section, the Department of Public Utility Control shall authorize the disbursement of a total of one million dollars in each month, commencing with July, 2003, and ending with July, 2005, from the Energy Conservation and Load Management Funds established pursuant to said subsections. The amount disbursed from each Energy Conservation and Load Management Fund shall be proportionately based on the receipts received by each fund. Such disbursements shall be deposited in the General Fund.

      (f) No later than December 31, 2006, and no later than December thirty-first every five years thereafter, the Energy Conservation Management Board shall, after consulting with the Renewable Energy Investments Board, conduct an evaluation of the performance of the programs and activities of the fund and submit a report, in accordance with the provisions of section 11-4a, of the evaluation to the joint standing committee of the General Assembly having cognizance of matters relating to energy.

      (g) Repealed by P.A. 06-186, S. 91, effective July 1, 2006.

      (P.A. 98-28, S. 33, 117; P.A. 03-135, S. 9; June 30 Sp. Sess. P.A. 03-6, S. 49; Sept. 8 Sp. Sess. P.A. 03-1, S. 9; P.A. 04-129, S. 1; 04-236, S. 12, 13; 04-247, S. 3; P.A. 05-251, S. 89; June Sp. Sess. P.A. 05-1, S. 5; P.A. 06-186, S. 91; P.A. 07-152, S. 3; 07-242, S. 105.)

      History: P.A. 98-28 effective July 1, 1998; P.A. 03-135 amended Subsec. (d) to divide existing provisions into Subdivs. (1) to (3) and make conforming changes, to add provision re review of each program and acceptance or rejection by the Energy Conservation Management Board in Subdiv. (1), to add provision re cost-effectiveness testing in Subdiv. (2), and to add "real-time monitoring systems" in Subdiv. (3), effective July 1, 2003; June 30 Sp. Sess. P.A. 03-6 amended Subsec. (a) to provide for a plan to avoid disbursements from the Energy Conservation and Load Management Fund to the General Fund in the implementation of the budget for the biennium ending June 30, 2005, effective August 20, 2003; Sept. 8 Sp. Sess. P.A. 03-1, S. 9 re disbursements to the General Fund for the biennium ending June 30, 2005, was added editorially by the Revisors as Subsec. (e), effective September 10, 2003; P.A. 04-129 amended Subsec. (d)(3) to redesignate existing Subpara. (G) as Subpara. (H) and to add new Subpara. (G) re indoor air quality programs; P.A. 04-236 amended Subsecs. (a) and (d)(2) to make technical changes, effective June 8, 2004; P.A. 04-247 amended Subsec. (d)(2) to change reporting date from January 31, 2001, and annually thereafter until January 31, 2006, to March 1, 2005, and March 1, 2006, effective July 1, 2004; P.A. 05-251, S. 89 added provisions, designated by the Revisors as Subsec. (g), re monthly disbursements to General Fund from August 1, 2006, to July 31, 2007, effective June 30, 2005; June Sp. Sess. P.A. 05-1 made technical changes in Subsecs. (a), (c) and (d), amended Subsec. (c) to add new Subdivs. (10) and (11) re a representative of a municipal electric energy cooperative and two representatives selected by gas companies and to add provisions re voting on unrelated matters, amended Subsec. (d)(1) to require plan to be consistent with the comprehensive energy plan, to require examination of opportunities for joint programs, and to require preference for projects that maximize reduction of federally mandated congestion charges, added new Subsec. (d)(2) establishing a joint committee of the Energy Conservation Management Board and the Renewable Energy Investments Advisory Committee, renumbering former Subsec. (d)(2) as new Subsec. (d)(3), amended Subsec. (d)(3) to add language re system benefits, to change the deadline for providing report, to require report to contain information on cooperation with municipal electric energy cooperatives, to allow disproportionate allocations from the funds, to require consultation with the Renewable Energy Investments Advisory Committee, and to require the report to describe collaboration with the Renewable Energy Investment Fund, renumbering former Subsec. (d)(3) as new Subsec. (d)(4), amended Subsec. (d)(4) to add language re programs to benefit low-income individuals and joint fuel conservation initiatives, and to revise language re expenditures for consultants and administrative costs, and added Subsec. (f) re evaluation of the performance of programs, effective July 21, 2005; P.A. 06-186 repealed P.A. 05-251, S. 89, previously designated by the Revisors as Subsec. (g), re monthly disbursements to General Fund from August 1, 2006, to July 31, 2007, effective July 1, 2006; P.A. 07-152 amended Subsec. (d)(1) to require Department of Public Utility Control to review comprehensive plan and amended Subsecs. (d) and (f) to change Renewable Energy Investments Advisory Committee to Renewable Energy Investments Board; P.A. 07-242 amended Subsec. (d)(1) to delete provision re comprehensive energy plan approved pursuant to Sec. 16a-7a, amended Subsec. (d)(3) to add "Such testing shall include an analysis of the effects of investments on increasing the state's load factor" and added Subsec. (d)(4)(J) re demand-side technology programs, effective July 1, 2007.

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      Sec. 16-245n. Renewable Energy Investment Fund created; charge assessed against electric customers to fund Investment Fund; purpose. (a) For purposes of this section, "renewable energy" means solar photovoltaic energy, solar thermal, geothermal energy, wind, ocean thermal energy, wave or tidal energy, fuel cells, landfill gas, hydropower that meets the low-impact standards of the Low-Impact Hydropower Institute, hydrogen production and hydrogen conversion technologies, low emission advanced biomass conversion technologies, alternative fuels, used for electricity generation including ethanol, biodiesel or other fuel produced in Connecticut and derived from agricultural produce, food waste or waste vegetable oil, provided the Commissioner of Environmental Protection determines that such fuels provide net reductions in greenhouse gas emissions and fossil fuel consumption, usable electricity from combined heat and power systems with waste heat recovery systems, thermal storage systems and other energy resources and emerging technologies which have significant potential for commercialization and which do not involve the combustion of coal, petroleum or petroleum products, municipal solid waste or nuclear fission.

      (b) On and after July 1, 2004, the Department of Public Utility Control shall assess or cause to be assessed a charge of not less than one mill per kilowatt hour charged to each end use customer of electric services in this state which shall be deposited into the Renewable Energy Investment Fund established under subsection (c) of this section. Notwithstanding the provisions of this section, receipts from such charges shall be disbursed to the resources of the General Fund during the period from July 1, 2003, to June 30, 2005, unless the department shall, on or before October 30, 2003, issue a financing order for each affected distribution company in accordance with sections 16-245e to 16-245k, inclusive, to sustain funding of renewable energy investment programs by substituting an equivalent amount, as determined by the department in such financing order, of proceeds of rate reduction bonds for disbursement to the resources of the General Fund during the period from July 1, 2003, to June 30, 2005. The department may authorize in such financing order the issuance of rate reduction bonds that substitute for disbursement to the General Fund for receipts of both charges under this subsection and subsection (a) of section 16-245m and also may in its discretion authorize the issuance of rate reduction bonds under this subsection and subsection (a) of section 16-245m that relate to more than one electric distribution company. The department shall, in such financing order or other appropriate order, offset any increase in the competitive transition assessment necessary to pay principal, premium, if any, interest and expenses of the issuance of such rate reduction bonds by making an equivalent reduction to the charges imposed under this subsection, provided any failure to offset all or any portion of such increase in the competitive transition assessment shall not affect the need to implement the full amount of such increase as required by this subsection and sections 16-245e to 16-245k, inclusive. Such financing order shall also provide if the rate reduction bonds are not issued, any unrecovered funds expended and committed by the electric distribution companies for renewable resource investment through deposits into the Renewable Energy Investment Fund, provided such expenditures were approved by the department following August 20, 2003, and prior to the date of determination that the rate reduction bonds cannot be issued, shall be recovered by the companies from their respective competitive transition assessment or systems benefits charge except that such expenditures shall not exceed one million dollars per month. All receipts from the remaining charges imposed under this subsection, after reduction of such charges to offset the increase in the competitive transition assessment as provided in this subsection, shall be disbursed to the Renewable Energy Investment Fund commencing as of July 1, 2003. Any increase in the competitive transition assessment or decrease in the renewable energy investment component of an electric distribution company's rates resulting from the issuance of or obligations under rate reduction bonds shall be included as rate adjustments on customer bills.

      (c) There is hereby created a Renewable Energy Investment Fund which shall be within Connecticut Innovations, Incorporated for administrative purposes only. The fund may receive any amount required by law to be deposited into the fund and may receive any federal funds as may become available to the state for renewable energy investments. Upon authorization of the Renewable Energy Investments Board established pursuant to subsection (d) of this section, Connecticut Innovations, Incorporated, may use any amount in said fund for expenditures that promote investment in renewable energy sources in accordance with a comprehensive plan developed by it to foster the growth, development and commercialization of renewable energy sources, related enterprises and stimulate demand for renewable energy and deployment of renewable energy sources that serve end use customers in this state and for the further purpose of supporting operational demonstration projects for advanced technologies that reduce energy use from traditional sources. Such expenditures may include, but not be limited to, reimbursement for services provided by the administrator of the fund including a management fee, disbursements from the fund to develop and carry out the plan developed pursuant to subsection (d) of this section, grants, direct or equity investments, contracts or other actions which support research, development, manufacture, commercialization, deployment and installation of renewable energy technologies, and actions which expand the expertise of individuals, businesses and lending institutions with regard to renewable energy technologies.

      (d) There is hereby created a Renewable Energy Investments Board to act on matters related to the Renewable Energy Investment Fund, including, but not limited to, development of a comprehensive plan and expenditure of funds. The Renewable Energy Investments Board shall, in such plan, give preference to projects that maximize the reduction of federally mandated congestion charges. The Renewable Energy Investments Board shall make a draft of the comprehensive plan available for public comment for not less than thirty days. The board shall conduct three public hearings in three different regions of the state on the draft comprehensive plan and shall include a summarization of all public comments received at said public hearings in the final comprehensive plan approved by the board. The board shall provide a copy of the comprehensive plan, in accordance with the provisions of section 11-4a, to the joint standing committees of the General Assembly having cognizance of matters relating to energy and commerce. The Department of Public Utility Control shall, in an uncontested proceeding, during which the department may hold a public hearing, approve, modify or reject the comprehensive plan prepared pursuant to this subsection.

      (e) The Renewable Energy Investments Board shall include not more than fifteen individuals with knowledge and experience in matters related to the purpose and activities of the Renewable Energy Investment Fund. The board shall consist of the following members: (1) One person with expertise regarding renewable energy resources appointed by the speaker of the House of Representatives; (2) one person representing a state or regional organization primarily concerned with environmental protection appointed by the president pro tempore of the Senate; (3) one person with experience in business or commercial investments appointed by the majority leader of the House of Representatives; (4) one person representing a state or regional organization primarily concerned with environmental protection appointed by the majority leader of the Senate; (5) one person with experience in business or commercial investments appointed by the minority leader of the House of Representatives; (6) the Commissioner of Emergency Management and Homeland Security or the commissioner's designee; (7) one person with expertise regarding renewable energy resources appointed by the Governor; (8) two persons with experience in business or commercial investments appointed by the board of directors of Connecticut Innovations, Incorporated; (9) a representative of a state-wide business association, manufacturing association or chamber of commerce appointed by the minority leader of the Senate; (10) the Consumer Counsel; (11) the Secretary of the Office of Policy and Management or the secretary's designee; (12) the Commissioner of Environmental Protection or the commissioner's designee; (13) a representative of organized labor appointed by the Governor; and (14) a representative of residential customers or low-income customers appointed by Governor. On a biennial basis, the board shall elect a chairperson and vice-chairperson from among its members and shall adopt such bylaws and procedures it deems necessary to carry out its functions. The board may establish committees and subcommittees as necessary to conduct its business.

      (f) The board shall issue annually a report to the Department of Public Utility Control reviewing the activities of the Renewable Energy Investment Fund in detail and shall provide a copy of such report, in accordance with the provisions of section 11-4a, to the joint standing committees of the General Assembly having cognizance of matters relating to energy and commerce and the Office of Consumer Counsel. The report shall include a description of the programs and activities undertaken during the reporting period jointly or in collaboration with the Energy Conservation and Load Management Funds established pursuant to section 16-245m.

      (g) There shall be a joint committee of the Energy Conservation Management Board and the Renewable Energy Investments Board, as provided in subdivision (2) of subsection (d) of section 16-245m.

      (h) No later than December 31, 2006, and no later than December thirty-first every five years thereafter, the board shall, after consulting with the Energy Conservation Management Board, conduct an evaluation of the performance of the programs and activities of the fund and submit a report, in accordance with the provisions of section 11-4a, of the evaluation to the joint standing committees of the General Assembly having cognizance of matters relating to energy and commerce.

      (P.A. 98-28, S. 44, 117; P.A. 03-135, S. 10, 11; June 30 Sp. Sess. P.A. 03-6, S. 50; June Sp. Sess. P.A. 05-1, S. 6; P.A. 07-152, S. 1; 07-242, S. 15, 120.)

      History: P.A. 98-28 effective July 1, 1998; P.A. 03-135 added "hydrogen production and hydrogen conversion technologies" in Subsec. (a) and added "the Department of Public Utility Control and the Office of Consumer Counsel" in Subsec. (d), effective July 1, 2003; June 30 Sp. Sess. P.A. 03-6 amended Subsec. (b) to provide for a plan to avoid disbursements from the Renewable Energy Investment Fund to the General Fund in the implementation of the budget for the biennium ending June 30, 2005, effective August 20, 2003; June Sp. Sess. P.A. 05-1 amended Subsec. (a) to add provision re certain usable energy and thermal storage systems, amended Subsec. (b) to make technical changes and to change assessment on and after July 1, 2004, from one mill to not less than one mill, amended Subsec. (d) to require preference for projects that maximize reduction of federally mandated congestion charges, to require consistency with the comprehensive energy plan, to require report to describe collaboration with the Energy Conservation and Load Management Funds, and to make technical changes, and added Subsec. (e) establishing a joint committee of the Energy Conservation Management Board and the Renewable Energy Investments Advisory Committee and Subsec. (f) re evaluation of the programs, effective July 21, 2005; P.A. 07-152 amended Subsec. (c) to put fund within Connecticut Innovations, Incorporated, for administrative purposes only and to make reimbursement for services provided by administrator a permissible expenditure, amended Subsec. (d) to change advisory committee to board, to move board appointees to new Subsec. (e) and to list requirements for the comprehensive plan, added Subsecs. (e) and (f) re appointments and reporting, redesignated existing Subsecs. (e) and (f) as Subsecs. (g) and (h) and made conforming changes therein; P.A. 07-242 added photovoltaic energy, solar thermal, geothermal energy, hydropower that meets low-impact standards of Low-Impact Hydropower Institute, and certain alternative fuels in Subsec. (a), amended Subsec. (c) to add certain operational demonstration projects to list of permissible fund expenditures, and deleted provision re comprehensive energy plan approved pursuant to Sec. 16a-7a in Subsec. (d), effective June 4, 2007.

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      Sec. 16-245aa. Municipal renewable energy and efficient energy generation grant program. (a) There is established an account to be known as the "municipal renewable energy and efficient energy grant account", which shall be a separate, nonlapsing account within the Renewable Energy Investment Fund, established pursuant to section 16-245n. The account shall contain any moneys required or permitted by law to be deposited in the account and any funds received from any public or private contributions, gifts, grants, donations, bequests or devises to the fund. Connecticut Innovations, Incorporated, may make grants-in-aid from the fund in accordance with the provisions of subsection (b) of this section.

      (b) Connecticut Innovations, Incorporated, in consultation with the Department of Public Utility Control, the Department of Education and the Department of Emergency Management and Homeland Security, shall establish a municipal renewable energy and efficient energy generation grant program. Connecticut Innovations, Incorporated, shall make grants under said program to municipalities for the purchase of (1) renewable energy sources, including solar energy, geothermal energy and fuel cells or other energy-efficient hydrogen-fueled energy, or (2) energy-efficient generation sources, including units providing combined heat-and-power operations with greater than sixty-five per cent efficiency or such higher efficiency level as Connecticut Innovations, Incorporated, may prescribe, for municipal buildings. Connecticut Innovations, Incorporated, shall give priority to applications for grants for disaster relief centers and high schools. Each grant shall be in an amount that makes the cost of purchasing and operating the renewable energy or energy-efficient generation source competitive with the municipality's current electricity expenses.

      (c) On or before October 1, 2007, Connecticut Innovations, Incorporated, shall develop an application for grants-in-aid under this section for the purpose of purchasing and operating renewable energy or energy-efficient generation sources and may receive applications from municipalities for such grants-in-aid on and after said date. Applications shall include, but not be limited to, a complete description of the proposed renewable energy or energy-efficient generation source.

      (d) Commencing with the fiscal year ending June 30, 2008, and for each of the five consecutive fiscal years thereafter, until the fiscal year ending June 30, 2012, not less than ten million dollars shall be available from the municipal renewable energy and efficient energy generation grant account for grants-in-aid to municipalities for the purpose of purchasing and operating renewable energy or energy-efficient generation sources. Any balance of such amount not used for such grants-in-aid during a fiscal year shall be carried forward for the fiscal year next succeeding for such grants-in-aid.

      (e) On or before January 1, 2009, and annually thereafter, Connecticut Innovations, Incorporated, shall report on the effectiveness of said program to the joint standing committee of the General Assembly having cognizance of matters relating to energy.

      (P.A. 07-242, S. 91.)

      History: P.A. 07-242 effective June 4, 2007.

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      Sec. 16-245bb. Bond authorization. (a) For the purposes described in subsection (b) of this section, the State Bond Commission shall have the power, from time to time, to authorize the issuance of bonds of the state in one or more series and in principal amounts not exceeding in the aggregate fifty million dollars.

      (b) The proceeds of the sale of said bonds, to the extent of the amount stated in subsection (a) of this section, shall be used by Connecticut Innovations, Incorporated, for the purpose of providing grants-in-aid pursuant to section 16-245aa.

      (c) All provisions of section 3-20, or the exercise of any right or power granted thereby, which are not inconsistent with the provisions of this section are hereby adopted and shall apply to all bonds authorized by the State Bond Commission pursuant to this section, and temporary notes in anticipation of the money to be derived from the sale of any such bonds so authorized may be issued in accordance with said section 3-20 and from time to time renewed. Such bonds shall mature at such time or times not exceeding twenty years from their respective dates as may be provided in or pursuant to the resolution or resolutions of the State Bond Commission authorizing such bonds. None of said bonds shall be authorized except upon a finding by the State Bond Commission that there has been filed with it a request for such authorization which is signed by or on behalf of the Secretary of the Office of Policy and Management and states such terms and conditions as said commission, in its discretion, may require. Said bonds issued pursuant to this section shall be general obligations of the state and the full faith and credit of the state of Connecticut are pledged for the payment of the principal of and interest on said bonds as the same become due, and accordingly and as part of the contract of the state with the holders of said bonds, appropriation of all amounts necessary for punctual payment of such principal and interest is hereby made, and the State Treasurer shall pay such principal and interest as the same become due.

      (P.A. 07-242, S. 90.)

      History: P.A. 07-242 effective July 1, 2007.

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      Sec. 16-245cc. Demand charge waiver for fuel cells. An electric supplier or an electric distribution company shall waive a demand charge for an operator of a fuel cell during (1) a loss of power due to problems at any distribution resource, or (2) a scheduled or unscheduled shutdown of the fuel cell if said shutdown occurs during off-peak hours. The charge waived shall not exceed the amount resulting from the problem or shutdown.

      (P.A. 07-242, S. 118.)

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      Sec. 16-245dd. Residential electric space heating tariff. Any electric distribution company that has a tariff for residential electric space heating customers shall maintain such tariff for a period of not less than five years after July 1, 2007. Such tariff shall be available for requests for electric service at a service location that was previously assigned to said tariff. Such tariff shall be available only to residential electric customers who use electric energy as the primary space heating source and who enter into an agreement with the electric distribution company for a period of not less than twelve months.

      (P.A. 07-242, S. 123.)

      History: P.A. 07-242 effective July 1, 2007.

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      Sec. 16-246g. Pilot program for electric generation. (a) Pursuant to section 22a-174l, the Department of Public Utility Control shall implement a pilot program that will (1) allow the electric generation resources to run more often on an economic and reliability dispatch basis, (2) identify strategies that couple multiple energy conservation and load shifting technologies into an aggregate resource plan that results in aggregate reductions in environmental emissions, and (3) simultaneously maintain the appropriate levels of generating capacity and reserve resources necessary to comply with established electric system reliability standards. Said pilot program shall be limited to resources that can be available to operate on or before December 1, 2007. The Department of Public Utility Control shall determine (A) a minimum ratio by which the benefits derived from the implementation of each application exceed the costs of its implementation, and (B) the maximum level of aggregate investments that will be cost-effective.

      (b) Any person owning or controlling emergency generation resources may apply to the Department of Public Utility Control for approval of a proposal to install equipment on emergency generation resources pursuant to section 22a-174l and the objectives of the pilot program as provided in this section. The department shall accept and act upon applications in the order in which they are received.

      (c) The Department of Public Utility Control shall approve only those applications that meet or exceed the provisions of section 22a-174l and the pilot program established pursuant to this section, provided the department shall not approve applications that will (1) exceed the level of aggregate cost-effective investment pursuant to the provisions of subsection (a) of this section, or (2) exceed the funding provided pursuant to the provisions of subsection (e) of this section.

      (d) The Department of Public Utility Control shall establish a financing mechanism to help persons applying under the provisions of subsection (b) of this section to defray the costs of installation of the equipment required pursuant to the provisions of section 22a-174l. Any such financing mechanism shall include such terms and conditions that the department determines to be reasonable and necessary to protect the public interest. Such mechanisms may include, but shall not be limited to, collateral requirements and assignment of payments made under any program administered by the regional independent system operator for emergency generation resources that qualify for such payments as the result of the equipment installed pursuant to an application made and approved under the provisions of this section.

      (e) The Department of Public Utility Control shall defray the costs of implementing this section from the revenues derived from charges for federally mandated congestion charges, provided the total costs shall not exceed the sum of ten million dollars in the aggregate. The department may retain such consultants as it deems necessary or convenient for the purposes of implementing the provisions of this section.

      (P.A. 07-242, S. 103.)

      History: P.A. 07-242 effective June 4, 2007.

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      Sec. 16-247l. Access by certified telecommunications providers to occupied buildings: Service, wiring, compensation, regulations, civil penalty. (a) As used in this section, "occupied building" means a building or a part of a building which is rented, leased, hired out, arranged or designed to be occupied, or is occupied (1) as the home or residence of three or more families living independently of each other, (2) as the place of business of three or more persons, firms or corporations conducting business independently of each other, or (3) by any combination of such families and such persons, firms or corporations totaling three or more, and includes trailer parks, mobile manufactured home parks, nursing homes, hospitals and condominium associations.

      (b) No owner of an occupied building shall demand or accept payment, in any form, except as provided in subsection (f) of this section, in exchange for permitting a certified telecommunications provider on or within his property or premises, or discriminate in rental charges or the provision of service between tenants who receive such service and those who do not, or those who receive such service from different certified telecommunications providers, provided such owner shall not be required to bear any cost for the installation or provision of such service.

      (c) An owner of an occupied building shall permit wiring to provide telecommunications service by a certified telecommunications provider in such building provided: (1) A tenant of such building requests services from that certified telecommunications provider; (2) the entire cost of such wiring is assumed by that certified telecommunications provider; (3) the certified telecommunications provider indemnifies and holds harmless the owner for any damages caused by such wiring; and (4) the certified telecommunications provider complies with all regulations of the Department of Public Utility Control pertaining to such wiring. The department shall adopt regulations, in accordance with the provisions of chapter 54, which shall set forth terms which may be included, and terms which shall not be included, in any contract to be entered into by an owner of an occupied building and a certified telecommunications provider concerning such wiring. No certified telecommunications provider shall present to an owner of an occupied building for review or for signature such a contract which contains a term prohibited from inclusion in such a contract by regulations adopted hereunder. The owner of an occupied building may require such wiring to be installed when the owner is present and may approve or deny the location at which such wiring enters such building.

      (d) Prior to completion of construction of an occupied building, an owner of such a building in the process of construction shall permit prewiring to provide telecommunications services in such building provided: (1) The certified telecommunications provider complies with all the provisions of subdivisions (2), (3) and (4) of subsection (c) of this section and subsection (f) of this section; and (2) all wiring other than that to be directly connected to the equipment of a telecommunications service customer shall be concealed within the walls of such building.

      (e) No certified telecommunications provider may enter into any agreement with the owner or lessee of, or person controlling or managing, an occupied building serviced by such provider, or commit or permit any act, that would have the effect, directly or indirectly, of diminishing or interfering with existing rights of any tenant or other occupant of such building to use or avail himself of the services of other certified telecommunications providers.

      (f) The department shall adopt regulations in accordance with the provisions of chapter 54 authorizing certified telecommunications providers, upon application by the owner of an occupied building and approval by the department, to reasonably compensate the owner for any taking of property associated with the installation of wiring and ancillary facilities for the provision of telecommunications service. The regulations may include, without limitation:

      (1) Establishment of a procedure under which owners may petition the department for additional compensation;

      (2) Authorization for owners and certified telecommunications providers to negotiate settlement agreements regarding the amount of such compensation, which agreements shall be subject to the department's approval;

      (3) Establishment of criteria for determining any additional compensation that may be due;

      (4) Establishment of a schedule or schedules of such compensation under specified circumstances; and

      (5) Establishment of application fees, or a schedule of fees, for applications under this subsection.

      (g) Nothing in subsection (f) of this section shall preclude a certified telecommunications provider from installing telecommunications equipment or facilities in an occupied building prior to the department's determination of reasonable compensation.

      (h) Any determination by the department under subsection (f) of this section regarding the amount of compensation to which an owner is entitled or approval of a settlement agreement may be appealed by an aggrieved party in accordance with the provisions of section 4-183.

      (i) Any person which the Department of Public Utility Control determines, after notice and opportunity for a hearing as provided in section 16-41, has failed to comply with any provision of subsections (b) to (e), inclusive, of this section shall pay to the state a civil penalty of not more than one thousand dollars for each day following the issuance of a final order by the department pursuant to section 16-41 that the person fails to comply with said subsections.

      (P.A. 94-106, S. 1; P.A. 99-286, S. 2, 19; P.A. 07-217, S. 61.)

      History: P.A. 99-286 deleted former Subsec. (a)(2) which defined "telecommunications provider", changed references to "telecommunications provider" to "certified telecommunications provider" and made technical changes, effective July 19, 1999; P.A. 07-217 made a technical change in Subsec. (h) effective July 12, 2007.

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      Sec. 16-256g. Proceeding to determine monthly subscriber fee. Assessment of subscribers for Enhanced 9-1-1 Telecommunications Fund. (a) By June first of each year, the Department of Public Utility Control shall conduct a proceeding to determine the amount of the monthly fee to be assessed against each subscriber of: (1) Local telephone service, (2) commercial mobile radio service, as defined in 47 CFR Section 20.3, (3) voice over Internet protocol service, as defined in section 28-30b, and (4) prepaid wireless telephone service, as defined in section 28-30b, to fund the development and administration of the enhanced emergency 9-1-1 program. The department shall base such fee on the findings of the Commissioner of Public Safety, pursuant to subsection (c) of section 28-24, taking into consideration any existing moneys available in the Enhanced 9-1-1 Telecommunications Fund. The department shall consider the progressive wire line inclusion schedule contained in the final report of the task force to study enhanced 9-1-1 telecommunications services established by public act 95-318*. The department shall not approve any fee greater than fifty cents per month per access line nor shall it approve any fee that does not include the progressive wire line inclusion schedule.

      (b) Each telephone or telecommunications company providing local telephone service, each provider of commercial mobile radio service, each provider of prepaid wireless telephone service and each provider of voice over Internet protocol service shall assess against each subscriber, the fee established by the department pursuant to subsection (a) of this section, which shall be remitted to the Office of State Treasurer for deposit into the Enhanced 9-1-1 Telecommunications Fund established pursuant to section 28-30a, not later than the fifteenth day of each month.

      (P.A. 89-259, S. 3, 5; P.A. 96-150, S. 3, 5; P.A. 99-286, S. 13, 19; P.A. 07-106, S. 4.)

      *Note: Public act 95-318 is special in nature and therefore has not been codified but remains in full force and effect according to its terms.


      History: P.A. 96-150 established, in Subsec. (a), annual proceeding to determine amount of monthly subscriber fee, lettered existing provisions as Subsec. (b), and amended Subsec. (b) to require assessment of such fee by local service providers and commercial mobile radio service providers rather than by "domestic telephone companies", effective May 31, 1996; P.A. 99-286 amended Subsec. (b) by making a technical change, effective July 19, 1999; P.A. 07-106 amended Subsec. (a) to make technical changes, add Subdiv. (1) and (2) designators and add new Subdivs. (3) and (4) re voice over Internet protocol service and prepaid wireless telephone service and amended Subsec. (b) to add provisions re providers of prepaid wireless telephone service and voice over Internet protocol service and re fee remitted to Treasurer's office for deposit into fund not later than 15th day of each month.

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      Sec. 16-258c. Dual-fuel capability requirements for electric generating facilities. On and after January 1, 2008, the Department of Public Utility Control shall order and direct that any intermediate or base load electric generating unit owned by an electric distribution company or covered by a bilateral contract with an electric distribution company that is fueled by either oil or natural gas, with a rating of not less than sixty-five megawatts, shall have the actual ability to operate on demand for a forty-eight-hour period using either oil or natural gas, provided the department may determine that dual fuel capability is not required for a specific generating unit if imposing such requirement is not in the best interest of Connecticut consumers.

      (P.A. 07-242, S. 4.)

      History: P.A. 07-242 effective June 4, 2007.

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      Sec. 16-262c. Termination of utility service for nonpayment, when prohibited. Amortization agreements. Moneys allowed to be deducted from customers' accounts and moneys to be included in rates as an operating expense. Hardship cases. Notice. Regulations. Annual reports. Privacy of individual customer utility usage and billing information. (a) Notwithstanding any other provision of the general statutes no electric, electric distribution, gas, telephone or water company, no electric supplier or certified telecommunications provider, and no municipal utility furnishing electric, gas, telephone or water service shall cause cessation of any such service by reason of delinquency in payment for such service (1) on any Friday, Saturday, Sunday, legal holiday or day before any legal holiday, provided such a company, electric supplier, certified telecommunications provider or municipal utility may cause cessation of such service to a nonresidential account on a Friday which is not a legal holiday or the day before a legal holiday when the business offices of the company, electric supplier, certified telecommunications provider or municipal utility are open to the public the succeeding Saturday, (2) at any time during which the business offices of said company, electric supplier, certified telecommunications provider or municipal utility are not open to the public, or (3) within one hour before the closing of the business offices of said company, electric supplier or municipal utility.

      (b) (1) From November first to May first, inclusive, no electric or electric distribution company, as defined in section 16-1, no electric supplier and no municipal utility furnishing electricity shall terminate or refuse to reinstate residential electric service in hardship cases where the customer lacks the financial resources to pay his or her entire account. From November first to May first, inclusive, no gas company and no municipal utility furnishing gas shall terminate or refuse to reinstate residential gas service in hardship cases where the customer uses such gas for heat and lacks the financial resources to pay his or her entire account, except a gas company that, between May second and October thirty-first, terminated gas service to a residential customer who uses gas for heat and who, during the previous period of November first to May first, had gas service maintained because of hardship status, may refuse to reinstate the gas service from November first to May first, inclusive, only if the customer has failed to pay, since the preceding November first, the lesser of: (A) Twenty per cent of the outstanding principal balance owed the gas company as of the date of termination, (B) one hundred dollars, or (C) the minimum payments due under the customer's amortization agreement. Notwithstanding any other provision of the general statutes to the contrary, no electric, electric distribution or gas company, no electric supplier and no municipal utility furnishing electricity or gas shall terminate or refuse to reinstate residential electric or gas service where the customer lacks the financial resources to pay his or her entire account and for which customer or a member of the customer's household the termination or failure to reinstate such service would create a life-threatening situation.

      (2) During any period in which a residential customer is subject to termination, an electric, electric distribution or gas company, an electric supplier or a municipal utility furnishing electricity or gas shall provide such residential customer whose account is delinquent an opportunity to enter into a reasonable amortization agreement with such company, electric supplier or utility to pay such delinquent account and to avoid termination of service. Such amortization agreement shall allow such customer adequate opportunity to apply for and receive the benefits of any available energy assistance program. An amortization agreement shall be subject to amendment on customer request if there is a change in the customer's financial circumstances.

      (3) As used in this section, (A) "household income" means the combined income over a twelve-month period of the customer and all adults, except children of the customer, who are and have been members of the household for six months or more, and (B) "hardship case" includes, but is not limited to: (i) A customer receiving local, state or federal public assistance; (ii) a customer whose sole source of financial support is Social Security, Veterans' Administration or unemployment compensation benefits; (iii) a customer who is head of the household and is unemployed, and the household income is less than three hundred per cent of the poverty level determined by the federal government; (iv) a customer who is seriously ill or who has a household member who is seriously ill; (v) a customer whose income falls below one hundred twenty-five per cent of the poverty level determined by the federal government; and (vi) a customer whose circumstances threaten a deprivation of food and the necessities of life for himself or dependent children if payment of a delinquent bill is required.

      (4) In order for a residential customer of a gas or electric distribution company using gas or electricity for heat to be eligible to have any moneys due and owing deducted from the customer's delinquent account pursuant to this subdivision, the company furnishing gas or electricity shall require that the customer (A) apply and be eligible for benefits available under the Connecticut energy assistance program or state appropriated fuel assistance program; (B) authorize the company to send a copy of the customer's monthly bill directly to any energy assistance agency for payment; (C) enter into and comply with an amortization agreement, which agreement is consistent with decisions and policies of the Department of Public Utility Control. Such an amortization agreement shall reduce a customer's payment by the amount of the benefits reasonably anticipated from the Connecticut energy assistance program, state appropriated fuel assistance program or other energy assistance sources. Unless the customer requests otherwise, the company shall budget a customer's payments over a twelve-month period with an affordable increment to be applied to any arrearage, provided such payment plan will not result in loss of any energy assistance benefits to the customer. If a customer authorizes the company to send a copy of his monthly bill directly to any energy assistance agency for payment, the energy assistance agency shall make payments directly to the company. If, on April thirtieth, a customer has been in compliance with the requirements of subparagraphs (A) to (C), inclusive, of this subdivision, during the period starting on the preceding November first, or from such time as the customer's account becomes delinquent, the company shall deduct from such customer's delinquent account an additional amount equal to the amount of money paid by the customer between the preceding November first and April thirtieth and paid on behalf of the customer through the Connecticut energy assistance program and state appropriated fuel assistance program. Any customer in compliance with the requirements of subparagraphs (A) to (C), inclusive, of this subdivision, on April thirtieth who continues to comply with an amortization agreement through the succeeding October thirty-first, shall also have an amount equal to the amount paid pursuant to such agreement and any amount paid on behalf of such customer between May first and the succeeding October thirty-first deducted from the customer's delinquent account. In no event shall the deduction of any amounts pursuant to this subdivision result in a credit balance to the customer's account. No customer shall be denied the benefits of this subdivision due to an error by the company. The Department of Public Utility Control shall allow the amounts deducted from the customer's account pursuant to the implementation plan, described in subdivision (5) of this subsection, to be recovered by the company in its rates as an operating expense, pursuant to said implementation plan. If the customer fails to comply with the terms of the amortization agreement or any decision of the department rendered in lieu of such agreement and the requirements of subparagraphs (A) to (C), inclusive, of this subdivision, the company may terminate service to the customer, pursuant to all applicable regulations, provided such termination shall not occur between November first and May first.

      (5) Each gas and electric distribution company shall submit to the Department of Public Utility Control annually, on or before July first, an implementation plan which shall include information concerning amortization agreements, counseling, reinstatement of eligibility, rate impacts and any other information deemed relevant by the department. The Department of Public Utility Control may, in consultation with the Office of Policy and Management, approve or modify such plan within ninety days of receipt of the plan. If the department does not take any action on such plan within ninety days of its receipt, the plan shall automatically take effect at the end of the ninety-day period, provided the department may extend such period for an additional thirty days by notifying the company before the end of the ninety-day period. Any amount recovered by a company in its rates pursuant to this subsection shall not include any amount approved by the Department of Public Utility Control as an uncollectible expense. The department may deny all or part of the recovery required by this subsection if it determines that the company seeking recovery has been imprudent, inefficient or acting in violation of statutes or regulations regarding amortization agreements.

      (6) On or after January 1, 1993, the Department of Public Utility Control may require gas companies to expand the provisions of subdivisions (4) and (5) of this subsection to all hardship customers. Any such requirement shall not be effective until November 1, 1993.

      (7) (A) All electric, electric distribution and gas companies, electric suppliers and municipal utilities furnishing electricity or gas shall collaborate in developing, subject to approval by the Department of Public Utility Control, standard provisions for the notice of delinquency and impending termination under subsection (a) of section 16-262d. Each such company and utility shall place on the front of such notice a provision that the company, electric supplier or utility shall not effect termination of service to a residential dwelling for nonpayment of disputed bills during the pendency of any complaint. In addition, the notice shall state that the customer must pay current and undisputed bill amounts during the pendency of the complaint. (B) At the beginning of any discussion with a customer concerning a reasonable amortization agreement, any such company or utility shall inform the customer (i) of the availability of a process for resolving disputes over what constitutes a reasonable amortization agreement, (ii) that the company, electric supplier or utility will refer such a dispute to one of its review officers as the first step in attempting to resolve the dispute, and (iii) that the company, electric supplier or utility shall not effect termination of service to a residential dwelling for nonpayment of a delinquent account during the pendency of any complaint, investigation, hearing or appeal initiated by the customer, unless the customer fails to pay undisputed bills, or undisputed portions of bills, for service received during such period. (C) Each such company, electric supplier and utility shall inform and counsel all customers who are hardship cases as to the availability of all public and private energy conservation programs, including programs sponsored or subsidized by such companies and utilities, eligibility criteria, where to apply, and the circumstances under which such programs are available without cost.

      (8) The Department of Public Utility Control shall adopt regulations in accordance with chapter 54 to carry out the provisions of this subsection. Such regulations shall include, but not be limited to, criteria for determining hardship cases and for reasonable amortization agreements, including appeal of such agreements, for categories of customers. Such regulations may include the establishment of a reasonable rate of interest which a company may charge on the unpaid balance of a customer's delinquent bill and a description of the relationship and responsibilities of electric suppliers to customers.

      (c) Each electric, electric distribution and gas company, electric supplier and municipal utility shall, not later than December first, annually, submit a report to the department and the General Assembly indicating (1) the number of customers in each of the following categories and the total delinquent balances for such customers as of the preceding May first: (A) Customers who are hardship cases and (i) who made arrangements for reasonable amortization agreements, (ii) who did not make such arrangements, and (B) customers who are nonhardship cases and who made arrangements for reasonable amortization, (2) (A) the number of heating customers receiving energy assistance during the preceding heating season and the total amount of such assistance, and (B) the total balance of the accounts of such customers after all energy assistance is applied to the accounts, (3) the number of hardship cases reinstated between November first of the preceding year and May first of the same year, the number of hardship cases terminated between May first of the same year and November first and the number of hardship cases reinstated during each month from May to November, inclusive, of the same year, (4) the number of reasonable amortization agreements executed and the number breached during the same year by (A) hardship cases, and (B) nonhardship cases, and (5) the number of accounts of (A) hardship cases, and (B) nonhardship cases for which part or all of the outstanding balance is written off as uncollectible during the preceding year and the total amount of such uncollectibles.

      (d) Nothing in this section shall (1) prohibit a public service company, electric supplier or municipal utility from terminating residential utility service upon request of the customer or in accordance with section 16-262d upon default by the customer on an amortization agreement or collecting delinquent accounts through legal processes, including the processes authorized by section 16-262f, or (2) relieve such company, electric supplier or municipal utility of its responsibilities set forth in sections 16-262d and 16-262e to occupants of residential dwellings or, with respect to a public service company or electric supplier, the responsibilities set forth in section 19a-109.

      (e) No provision of the Freedom of Information Act, as defined in section 1-200, shall be construed to require or permit a municipal utility furnishing electric, gas or water service, a municipality furnishing water or sewer service, a district established by special act or pursuant to chapter 105 and furnishing water or sewer service or a regional authority established by special act to furnish water or sewer service to disclose records under the Freedom of Information Act, as defined in section 1-200, which identify or could lead to identification of the utility usage or billing information of individual customers, to the extent such disclosure would constitute an invasion of privacy.

      (f) If an electric supplier suffers a loss of revenue by operation of this section, the supplier may make a claim for such revenue to the department. The electric distribution company shall reimburse the electric supplier for such losses found to be reasonable by the department at the lower of (1) the price of the contract between the supplier and the customer, or (2) the electric distribution company's price to customers for default service, as determined by the department. The electric distribution company may recover such reimbursement, along with transaction costs, through the systems benefits charge.

      (1969, P.A. 194, S. 1; P.A. 75-625, S. 2, 8; P.A. 79-362, S. 1, 2; P.A. 83-505, S. 1, 3; P.A. 90-338; P.A. 91-150, S. 1, 2; P.A. 95-39, S. 1, 3; 95-274, S. 2; P.A. 96-46, S. 3; 96-204; P.A. 97-9, S. 1, 2; 97-20, S. 1, 2; 97-47, S. 32; P.A. 98-28, S. 38, 117; P.A. 99-222, S. 14, 19; P.A. 03-47, S. 1; P.A. 07-242, S. 67.)

      History: P.A. 75-625 included telephone companies and service and municipal utilities providing gas, electric, telephone or water service in provisions and added "notwithstanding" phrase; P.A. 79-362 prohibited cessation of services to any customer because of delinquent payment "within one hour before the closing" of business office and added Subsecs. (b) and (c); P.A. 83-505 renumbered Subsec. (b)(4) as Subdiv. (5) and inserted new Subdiv. (4) setting forth requirements re notice to customers of termination and reasonable amortization agreement procedures and energy conservation programs and relettered Subsec. (c) as Subsec. (d) and inserted new Subsec. (c) requiring companies and utilities to submit annual report consisting of data re delinquencies and terminations; P.A. 90-338 added Subsec. (e) re nondisclosure of certain customer information; P.A. 91-150 inserted new Subsec. (b)(4) to (6) establishing procedures which allow a gas company to deduct moneys from a customer's bill upon compliance with certain conditions and authorizing gas companies to include such moneys deducted as an operating expense, requiring each gas company to annually submit a report to the department concerning the procedures and authorizing the department to expand the procedures to apply to all hardship customers, renumbering as necessary; P.A. 95-39 amended Subsec. (a) by dividing Subsec. into Subdivs. and adding proviso in Subdiv. (1) re nonresidential accounts, effective July 1, 1995; P.A. 95-274 amended Subsec. (b)(1) by adding provision re life-threatening termination or refusal to reinstate and Subdiv. (b)(3) by adding definition of "household income", changing lettering and numbering and in new (iii) adding provision re federal poverty level; P.A. 96-46 amended Subsec. (b)(5) to make the approval or modification of plans by the department discretionary rather than mandatory and to add provision re effect of plan if department takes no action on it; P.A. 96-204 amended Subsec. (b)(1) to add exception allowing gas companies to refuse to reinstate service in certain circumstances and made technical changes to Subsec. (b)(2); P.A. 97-9 amended Subsec. (a)(1) to delete termination date of July 1, 1997, effective July 1, 1997; P.A. 97-20 amended Subsec. (b)(1) to substitute "the preceding November first" for "April fifteenth", effective July 1, 1997; P.A. 97-47 substituted "the Freedom of Information Act, as defined in Sec. 1-18a" for "chapter 3"; P.A. 98-28 added provisions re electric suppliers and electric distribution companies, made technical changes and added new Subsec. (f) re electric supplier losses, effective July 1, 1998; P.A. 99-222 amended Subsec. (a) by adding "certified telecommunications provider" and making a technical change, effective June 29, 1999; P.A. 03-47 amended Subsec. (b)(4) and (5) to include electric distribution companies and make conforming changes; P.A. 07-242 changed "April fifteenth" to "May first" and made conforming and technical changes in Subsecs. (b) and (c).

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      Sec. 16-262f. Action for receivership of rents and common expenses by electric, electric distribution, gas and telephone companies; petition; hearing; appointment; duties; termination. (a)(1) Upon default of the owner, agent, lessor or manager of a residential dwelling who is billed directly by an electric, electric distribution, gas or telephone company or by a municipal utility for electric or gas utility service furnished to such building, such company or municipal utility or electric supplier providing electric generation services may petition the Superior Court or a judge thereof, for appointment of a receiver of the rents or payments for use and occupancy or common expenses, as defined in section 47-202, for any dwelling for which the owner, agent, lessor or manager is in default. The court or judge shall forthwith issue an order to show cause why a receiver should not be appointed, which shall be served upon the owner, agent, lessor or manager or his agent in a manner most reasonably calculated to give notice to such owner, agent, lessor or manager as determined by such court or judge, including, but not limited to, a posting of such order on the premises in question.

      (2) A hearing shall be had on such order no later than seventy-two hours after its issuance or the first court day thereafter. The sole purpose of such a hearing shall be to determine whether there is an amount due and owing between the owner, agent, lessor or manager and the company, electric supplier or municipal utility. The court shall make a determination of any amount due and owing and any amount so determined shall constitute a lien upon the real property of such owner. A certificate of such amount may be recorded in the land records of the town in which such property is located describing the amount of the lien and the name of the party in default. When the amount due and owing has been paid the company, electric supplier or municipality shall issue a certificate discharging the lien and shall file the certificate in the land records of the town in which such lien was recorded.

      (3) The receiver appointed by the court shall collect all rents or payments for use and occupancy or common expenses forthcoming from or paid on behalf of the occupants or residents of the building or facility in question in place of the owner, agent, lessor, manager or administrator.

      (4) The receiver shall pay the petitioner or other supplier, from such rents or payments for use and occupancy or common expenses for electric, gas, telephone, water or heating oil supplied on and after the date of his appointment. The owner, agent, lessor or manager shall be liable for such reasonable fees and costs determined by the court to be due the receiver, which fees and costs may be recovered from the rents or payments for use and occupancy under the control of the receiver, provided no such fees or costs shall be recovered until after payment for current electric, gas, telephone and water service and heating oil deliveries has been made. The owner, agent, lessor or manager shall be liable to the petitioner for reasonable attorney's fees and costs incurred by the petitioner, provided no such fees or costs shall be recovered until after payment for current electric, gas, telephone and water service and heating oil deliveries has been made and after payments of reasonable fees and costs to the receiver. Any moneys from rental payments or payments for use and occupancy or common expenses remaining after payment for current electric, gas, telephone and water service or heating oil deliveries, and after payment for reasonable costs and fees to the receiver, and after payment to the petitioner for reasonable attorney's fees and costs, shall be applied to any arrearage found by the court to be due and owing the company, electric supplier or municipal utility from the owner, agent, lessor or manager for service provided such building. Any moneys remaining thereafter shall be turned over to the owner, agent, lessor or manager. The court may order an accounting to be made at such times as it determines to be just, reasonable, and necessary.

      (b) Any receivership established pursuant to subsection (a) of this section shall be terminated by the court upon its finding that the arrearage which was the subject of the original petition has been satisfied, or that all occupants have agreed to assume liability in their own names for prospective service supplied by the petitioner, or that the building has been sold and the new owner has assumed liability for prospective service supplied by the petitioner.

      (c) Nothing in this section shall be construed to prevent the petitioner from pursuing any other action or remedy at law or equity that it may have against the owner, agent, lessor or manager.

      (d) Any owner, agent, lessor or manager who collects or attempts to collect any rent or payment for use and occupancy from any occupant of a building subject to an order appointing a receiver shall be found, after due notice and hearing, to be in contempt of court.

      (e) If a proceeding is initiated pursuant to sections 47a-14a to 47a-14h, inclusive, or sections 47a-56 to 47a-56i, inclusive, or if a receiver of rents is appointed pursuant to chapter 735a or pursuant to any other action involving the making of repairs to residential rental property under court supervision, rent or use and occupancy payments shall be made pursuant to such proceeding or action without regard to whether such proceeding or action is initiated before or after a receivership is established under this section, and such proceeding or action shall take priority over a receivership established under this section in regard to expenditure of such rent or use and occupancy payments.

      (P.A. 75-625, S. 4, 8; P.A. 77-452, S. 51, 72; P.A. 84-394, S. 1; P.A. 89-254, S. 15; P.A. 91-310, S. 2; P.A. 98-28, S. 41, 117; 98-102, S. 1; P.A. 07-217, S. 62; 07-228, S. 2.)

      History: P.A. 77-452 replaced court of common pleas with superior court and deleted phrase which had limited judge's power to act to time when court not in session; P.A. 84-394 inserted references to payment for heating oil in Subsec. (a); P.A. 89-254 added Subsec. (e) re the payment and expenditure of rent or use and occupancy payments made pursuant to certain proceedings or actions in relation to receiverships established under this section; P.A. 91-310 added provision allowing companies or municipal utilities to obtain a lien against parties in default; P.A. 98-28 amended Subsec. (a) by adding electric suppliers and electric distribution companies, effective July 1, 1998; P.A. 98-102 amended Subsec. (a) by inserting Subdiv. indicators, deleting water companies and inserting "common expenses"; P.A. 07-217 made a technical change in Subsec. (b), effective July 12, 2007; P.A. 07-228 amended Subsec. (a)(3) to include payments paid on behalf of occupants or residents of building or facility, and in place of the administrator, effective July 1, 2007.

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      Sec. 16-262m. Construction specifications for water companies. (a) As used in this section and section 8-25a, "water company" means a corporation, company, association, joint stock association, partnership, municipality, state agency, other entity or person, or lessee thereof, owning, leasing, maintaining, operating, managing or controlling any pond, lake, reservoir, stream, well or distributing plant or system employed for the purpose of supplying water to fifteen or more service connections or twenty-five or more persons for at least sixty days in any one year.

      (b) No water company may begin the construction of a water supply system for the purpose of supplying water to fifteen or more service connections or twenty-five or more persons for at least sixty days in any one year, and no person or entity, except a water company supplying more than two hundred fifty service connections or one thousand persons, may begin expansion of such a water supply system, without having first obtained a certificate of public convenience and necessity.

      (c) For systems serving twenty-five or more residents that are not the subject of proceedings under subsection (c) of section 16-262n or section 16-262o, an application for a certificate of public convenience and necessity shall be on a form prescribed by the Department of Public Utility Control, in consultation with the Department of Public Health, and accompanied by a copy of the water company's construction or expansion plans, a fee of one hundred dollars and when applicable, a copy of a signed agreement between the water company and provider for the exclusive service area, as determined pursuant to section 25-33g, detailing those terms and conditions under which the system will be constructed or expanded and for which the provider will assume service and ownership responsibilities. The departments shall issue a certificate to an applicant upon determining, to their satisfaction, that (1) no interconnection is feasible with a water system owned by, or made available through arrangement with, the provider for the exclusive service area, as determined pursuant to section 25-33g or with another existing water system where no exclusive service area has been assigned, (2) the applicant will complete the construction or expansion in accordance with engineering standards established by regulation by the Department of Public Utility Control for water supply systems, (3) ownership of the system will be assigned to the provider for the exclusive service area, as determined pursuant to section 25-33g, (4) the proposed construction or expansion will not result in a duplication of water service in the applicable service area, and (5) the applicant meets all federal and state standards for water supply systems. Any construction or expansion with respect to which a certificate is required shall thereafter be built, maintained and operated in conformity with the certificate and any terms, limitations or conditions contained therein.

      (d) The Department of Public Utility Control and the Department of Public Health, shall each adopt regulations, in accordance with the provisions of chapter 54, to carry out the purposes of subsections (a) to (c), inclusive, of this section.

      (e) (1) For systems serving twenty-five or more persons, but not twenty-five or more residents, at least sixty days in any one year an application for a certificate of public convenience and necessity shall be on a form prescribed by the Department of Public Health and accompanied by a copy of the construction or expansion plans. The Department of Public Health shall issue a certificate to an applicant upon determining, to its satisfaction, that (A) no interconnection is feasible with a water system owned by, or made available through arrangement with, the provider for the exclusive service area, as determined pursuant to section 25-33g or with another existing water system where no existing exclusive service area has been assigned, (B) the applicant will complete the construction or expansion in accordance with engineering standards established by regulation for water supply systems, (C) ownership of the system will be assigned to the provider for the exclusive service area, as determined pursuant to section 25-33g, if agreeable to the exclusive service area provider and the Department of Public Health, or may remain with the applicant, if agreeable to the Department of Public Health, provided the applicant has the financial, managerial and technical resources to (i) operate the proposed water supply system in a reliable and efficient manner, and (ii) provide continuous adequate service to consumers served by the system, until such time as the water system for the exclusive service area, as determined by section 25-33g, has made an extension of the water main, after which the applicant shall obtain service from the provider for the exclusive service area, (D) the proposed construction or expansion will not result in a duplication of water service in the applicable service area, and (E) the applicant meets all federal and state standards for water supply systems. Any construction or expansion with respect to which a certificate is required shall thereafter be built, maintained and operated in conformity with the certificate and any terms, limitation or conditions contained therein. Properties held by the Department of Environmental Protection and used for or in support of fish culture, natural resource conservation or outdoor recreational purposes shall be exempt from the requirements of subdivisions (1), (3) and (4) of subsection (c) of this section and subparagraphs (A), (C) and (D) of subdivision (1) of subsection (e) of this section.

      (2) The Department of Public Health shall adopt regulations, in accordance with the provisions of chapter 54, to carry out the purposes of this subsection. Such regulations may include measures that encourage water conservation and proper maintenance.

      (P.A. 81-427, S. 1, 3; P.A. 84-330, S. 1; P.A. 86-247, S. 1, 2; P.A. 93-245; 93-381, S. 9, 39; 93-435, S. 59, 95; P.A. 94-219, S. 3; P.A. 95-257, S. 12, 21, 58; P.A. 98-250, S. 22, 39; P.A. 07-244, S. 1.)

      History: P.A. 84-330 amended Subsec. (a) to apply definition of water company "to sections 16-262n to 16-262q, inclusive, and section 8-25a", to include municipalities in such definition and to expand the definition by including companies supplying water to not less than 15 service connections or 25 persons nor more than 250 service connections or 1,000 persons, amended Subsec. (b) to require, as a condition for issuing a certificate that determination be made that no feasible interconnection with an existing system is available and that applicant meets all federal and state standards for community water supply and amended Subsecs. (b) and (c) to require departments of public utility control and health services to jointly carry out purposes of the section; P.A. 86-247 added provision in Subsec. (b) re certificate for a community water supply system for an elderly housing project; P.A. 93-245 amended Subsec. (b) by deleting exception for elderly housing projects and adding provisions regarding excepted community water supply systems and voluntarily transferring ownership of community water supply systems; P.A. 93-381 and 93-435 replaced department of health services with department of public health and addiction services, effective July 1, 1993; P.A. 94-219 made a technical change in Subsec. (a); P.A. 95-257 replaced Commissioner and Department of Public Health and Addiction Services with Commissioner and Department of Public Health, effective July 1, 1995; P.A. 98-250 amended Subsec. (a) to delete "nor more than two hundred fifty service connections or one thousand persons", amended Subsec. (b) to add exception re "a water company supplying more than two hundred fifty service connections or one thousand persons" and delete reference to "community" water supply systems, and made technical changes, effective July 1, 1998; P.A. 07-244 amended Subsec. (a) to redefine "water company" to include state agencies and substitute "for at least sixty days in any one year" for "on a regular basis", amended Subsec. (b) to limit its provisions to systems supplying water to 15 or more service connections or 25 or more persons, and to move provisions re application for certificate of public convenience and necessity into newly designated Subsec. (c), added provisions in new Subsec. (c) re agreement between water company and provider for exclusive service area, and factors to be used by department in determining whether to issue certificate, redesignated existing Subsec. (c) as Subsec. (d) and added Subsec. (e) specifying application requirements for systems serving 25 or more persons, but not 25 or more residents, and requiring adoption of regulations pertaining to such systems.

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      Sec. 16-262v. Water company infrastructure projects: Definitions. For purposes of this section:

      (1) "Eligible projects" means those water company plant projects not previously included in the water company's rate base in its most recent general rate case and that are intended to improve or protect the quality and reliability of service to customers, including (A) renewal or replacement of existing infrastructure, including mains, valves, services, meters and hydrants that have either reached the end of their useful life, are worn out, are in deteriorated condition, are or will be contributing to unacceptable levels of unaccounted for water, or are negatively impacting water quality or reliability of service if not replaced; (B) main cleaning and relining projects; (C) relocation of facilities as a result of government actions, the capital costs of which are not otherwise eligible for reimbursement; and (D) purchase of leak detection equipment or installation of production meters, and pressure reducing valves.

      (2) "Department" means the Department of Public Utility Control.

      (3) "Infrastructure assessment report" means a report filed by a water company with the department that identifies water system infrastructure needs and the company's criteria for determining the priority for eligible projects related to infrastructure.

      (4) "Pretax return" means the revenue necessary, after deduction of depreciation and property taxes, to produce net operating income equal to the water company's weighted cost of capital as approved by the department in the company's most recent general rate case multiplied by the new original cost of eligible projects.

      (5) "Reconciliation adjustment" means the difference between revenues actually collected through the water infrastructure and conservation adjustment and the amount allowed under the WICA for that period for the eligible projects. The amount of revenues overcollected or undercollected through the adjustment will be recovered or refunded, as appropriate, as a reconciliation adjustment over a one-year period commencing on April first.

      (6) "Water company" means a water company, as defined in section 16-1, that has filed for approval an individual infrastructure assessment report to support a request for a WICA adjustment.

      (7) "Water Infrastructure and Conservation Adjustment (WICA)" means an adjustment applied as a charge or credit to a water company customers' rates to recover the WICA costs of eligible projects.

      (8) "WICA costs" means the depreciation and property tax expenses and associated return on completed eligible projects.

      (9) "WICA revenues" means the revenues provided through a water infrastructure and conservation adjustment for eligible projects.

      (P.A. 07-139, S. 1.)

      History: P.A. 07-139 effective June 19, 2007.

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      Sec. 16-262w. Water company rate adjustment mechanisms. (a) The Department of Public Utility Control may authorize a water company to use a rate adjustment mechanism, such as a water infrastructure and conservation adjustment (WICA), for eligible projects completed and in service for the benefit of the customers. A water company may only charge customers such an adjustment to the extent allowed by the department based on a water company's infrastructure assessment report, as approved by the department and upon semiannual filings by the company which reflect plant additions consistent with such report. The department, in consultation with the Office of Consumer Counsel, shall conduct the proceeding in accordance with the provisions of section 16-18a.

      (b) On or before ninety days after June 19, 2007, the department shall initiate a generic docket on what shall be included in a water company's infrastructure assessment report and annual reconciliation reports and the criteria for determining priority of eligible projects. The department shall provide public notice with a deadline for interested parties to submit recommendations on the report contents and criteria. The department may hold a hearing on the generic docket but shall issue a decision on the docket not later than one hundred eighty days after the deadline for interested parties to submit their recommendations on the report contents and criteria.

      (c) The water company shall file their individual infrastructure assessment report with the department and such report shall identify the water system infrastructure needs and a water company's criteria for determining priority for eligible projects related to infrastructure. The department shall address such criteria in its docket initiated pursuant to subsection (b) of this section. Criteria may include, but shall not be limited to, (1) age, material or condition of the facilities; (2) extent and frequency of main breaks or interruption of service; (3) adequacy of pressure; (4) head loss; (5) availability of fire flows; and (6) the potential of such projects to improve system integrity and reliability.

      (d) The department shall approve a water company's individual infrastructure assessment report upon determining that the company has demonstrated through generally accepted engineering practices (1) the infrastructure projects considered for renewal or replacement are eligible projects; (2) such projects will benefit customers by improving water quality, system integrity or service reliability; (3) they adhere to the criteria established for determining priority for infrastructure projects; and (4) there is a sufficient level of investment in infrastructure. The department may hold a hearing to solicit input on a water company's individual infrastructure assessment report provided a decision on the assessment is made not later than one hundred eighty days after filing. Any such report not approved, rejected or modified by the department within such one-hundred-eighty-day period shall be deemed to have been approved.

      (e) Notwithstanding the provisions of section 16-19, upon department approval of a water company's individual infrastructure assessment report, the water company may charge the WICA for eligible projects in addition to such water company's existing rate schedule pursuant to subsection (f) of this section and the procedures and customer notification requirements in subsections (g) and (h) of this section.

      (f) The WICA adjustment shall be calculated as a percentage, based on the original cost of completed eligible projects multiplied by the applicable rate of return, plus associated depreciation and property tax expenses related to eligible projects and any reconciliation adjustment calculated pursuant to subsection (j) of this section as a percentage of the retail water revenues approved in its most recent rate filing for the regulated activities of said water company.

      (g) A water company may impose the WICA adjustment for eligible projects as a charge or credit on customers' bills at intervals of not less than six months, commencing on either January first, April first, July first or October first in any year. No proposed WICA charge or credit shall become effective until the Department of Public Utility Control has approved such charges or credits pursuant to an administrative proceeding. The department may receive and consider comments of interested persons and members of the public at such a proceeding, which shall not be considered a contested case for purposes of title 4, this section or any regulation adopted thereunder. Such administrative proceeding shall be completed not later than thirty days after the filing of an application by a water company or within a time period as otherwise established in the generic docket conducted pursuant to subsection (b) of this section. Any approval or denial of the department pursuant to this subsection shall not be deemed an order, authorization or decision of the department for purposes of section 16-35. Notwithstanding the provisions of this section, if the department has not rendered an approval or denial concerning any such application within the established timeframe, the proposed charges or credits shall become effective at the option of the company pending the department's finding with respect to such charges, provided the company will refund its customers any such amounts collected from them in excess of the charges approved by the department in its finding.

      (h) Water companies shall notify customers through a bill insert or other direct communications when the adjustment is first applied and the WICA charge or credit shall appear as a separate item on customers' bills.

      (i) The amount of the WICA applied between general rate case filings shall not exceed seven and one-half per cent of the water company's annual retail water revenues approved in its most recent rate filing, and shall not exceed five per cent of such revenues for any twelve-month period. The amount of the adjustment shall be reset to zero as of the effective date of new base rates approved pursuant to section 16-19 and shall be reset to zero if the company exceeds the allowable rate of return by more than one hundred basis points for any calendar year.

      (j) On or before February twenty-eighth of each year, a water company shall submit to the department an annual reconciliation report for any WICA charges applied to customers' rates through December thirty-first of the previous calendar year. Such reconciliation report shall identify those projects that have been completed, demonstrate that the WICA charges are limited to eligible projects that are in service and used and useful as of the end of the calendar year, and include any other information required as a result of the generic docket conducted pursuant to subsection (b) of this section. The company shall indicate in its report any significant changes in the extent of infrastructure spending, the priorities for determining eligible projects or the criteria established in the infrastructure assessment report. In addition, the reconciliation report shall compare the WICA revenues actually collected to the allowed amount of the adjustment. If upon completion of the review of the annual reconciliation report the department determines that a water company overcollected or undercollected the WICA adjustment, the difference between the revenue and costs for eligible projects will be recovered or refunded, as appropriate, as a reconciliation adjustment over a one-year period commencing on April first. The company shall refund the customers with interest for any overcollection but shall not be eligible for interest for any undercollection.

      (P.A. 07-139, S. 2.)

      History: P.A. 07-139 effective June 19, 2007.

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