OFFICE OF FISCAL ANALYSIS

Legislative Office Building, Room 5200

Hartford, CT 06106 (860) 240-0200

http://www.cga.ct.gov/ofa

sSB-1078

AN ACT CONCERNING AFFORDABLE AND RELIABLE ENERGY.

AMENDMENT

LCO No.: 8254

File Copy No.: 616

Senate Calendar No.: 345


OFA Fiscal Note

State Impact:

Agency Affected

Fund-Effect

FY 16 $

FY 17 $

Statewide (includes various state agencies)

All Funds - Potential Cost

See Below

See Below

Note: All Funds=All Funds

Municipal Impact:

Municipalities

Effect

FY 16 $

FY 17 $

All Municipalities

Potential Cost

See Below

See Below

Explanation

The amendment strikes the underlying bill and its associated fiscal impact.

The amendment allows electric companies to recover the costs of purchasing new natural gas capacity and storage through a rate proceeding. Costs may be incurred in FY 16 and FY 17 for the state and municipalities as ratepayers.

The amendment also allows the DEEP commissioner, in consultation with the procurement manager, the Office of Consumer Council (OCC) and the attorney general, to solicit proposals for contracts with generating facilities, energy storage systems, load management or conservation programs. The amendment allows DEEP to hire consultants with expertise in quantitative modeling of electric markets, gas markets, and electric systems to assist in evaluating proposals. The costs of such consultants cannot exceed $1.5 million and is recoverable through a component of electric rates. The amendment subjects any resulting agreement to the Public Utilities and Regulatory Authority's (PURA) review and approval.

The amendment requires the net costs of any such agreement to be recovered through a component of electric rates for all electric customers. Costs may be incurred in FY 16 and FY 17 for the state and municipalities as ratepayers. The process is not expect to have a fiscal impact as DEEP, OCC and PURA all have the staff and expertise to solicit the proposals and review them.

The net ratepayer impact for the state and municipalities in the out years depends on the potential savings from increased natural gas supply, load management and energy storage systems, and the cost the state and municipalities pay to electric companies to recover the costs of the new infrastructure. If savings are achieved, the amendment requires the savings be used to lower a component of electric rates for all electric customers of the contracted electric distribution company.

The preceding Fiscal Impact statement is prepared for the benefit of the members of the General Assembly, solely for the purposes of information, summarization and explanation and does not represent the intent of the General Assembly or either chamber thereof for any purpose. In general, fiscal impacts are based upon a variety of informational sources, including the analyst's professional knowledge. Whenever applicable, agency data is consulted as part of the analysis, however final products do not necessarily reflect an assessment from any specific department.