Rep. Norm Thurston — Voting Record

Bill

Number

H.B. 422 First Substitute (2018GS)

Sponsor

Rep. Noel, M.

Final action

Governor Signed 3/23/2018

Outcome

Became law — signed by Gov. Gary R. Herbert

Summary

What it does

• This bill:
• modifies provisions relating to requests for approval of an energy utility's resource decision;
• includes a project for rural gas infrastructure development as a resource decision that a gas corporation may request approval of from the Public Service Commission;
• provides requirements related to a request for approval of rural gas infrastructure development; and
• authorizes the Public Service Commission to spread rural gas infrastructure development costs to the larger customer base and to approve the inclusion of rural gas infrastructure development costs within a gas corporation's base rates under certain circumstances.

Every vote on this bill

Bill text

NATURAL GAS INFRASTRUCTURE AMENDMENTS
GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Michael E. Noel
Senate Sponsor: 
David P. Hinkins
LONG TITLE
General Description:
This bill enacts provisions relating to natural gas infrastructure.
Highlighted Provisions:
This bill:
▸ modifies provisions relating to requests for approval of an energy utility's resource
decision;
▸ includes a project for rural gas infrastructure development as a resource decision
that a gas corporation may request approval of from the Public Service
Commission;
▸ provides requirements related to a request for approval of rural gas infrastructure
development; and
▸ authorizes the Public Service Commission to spread rural gas infrastructure
development costs to the larger customer base and to approve the inclusion of rural
gas infrastructure development costs within a gas corporation's base rates under
certain circumstances.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
54-17-401
, as last amended by Laws of Utah 2008, Chapter 382
54-17-402
, as last amended by Laws of Utah 2008, Chapter 382
54-17-403
, as enacted by Laws of Utah 2005, Chapter 11
Be it enacted by the Legislature of the state of Utah:
Section 1. Section 
54-17-401
 is amended to read:
54-17-401.
Definitions -- Rules.
(1)
 As used in this part:
[
(1)
] 
(a)
 "Energy utility" means one of the following with 200,000 retail customers in
the state:
[
(a)
] 
(i)
 an electrical corporation; or
[
(b)
] 
(ii)
 a gas corporation.
[
(2) (a)
] 
(b)
 "Resource decision" means a decision, other than a decision to construct or
acquire a significant energy resource, involving:
(i) an energy utility's acquisition, management, or operation of energy production,
processing, transmission, or distribution facilities or processes including:
(A) a facility or process for the efficient, reliable, or safe provision of energy to retail
customers; [
or
]
(B) an energy efficiency and conservation program; or
(C) rural gas infrastructure development; or
(ii) a decision determined by the commission to be appropriate for review under this
part.
(c) "Rural gas infrastructure development" means the planning, development, and
construction of an extension or expansion of natural gas main lines to serve previously
unserved rural areas of the state.
[
(b)
] 
(2)
 The commission may adopt rules in accordance with Title 63G, Chapter 3,
Utah Administrative Rulemaking Act, to specify the nature of resource decisions subject to
approval under Section 
54-17-402
.
Section 2. Section 
54-17-402
 is amended to read:
54-17-402.
Request for review of resource decision.
(1) Beginning on February 25, 2005, before implementing a resource decision, an
energy utility may request that the commission approve all or part of a resource decision in
accordance with this part.
(2) (a) To obtain the approval permitted by Subsection (1), the energy utility shall file a
request for approval with the commission.
(b) The request for approval required by this section shall include any information
required by the commission by rule made in accordance with Title 63G, Chapter 3, Utah
Administrative Rulemaking Act.
(c) A request for approval of natural gas infrastructure development shall include:
(i) a description of the proposed rural gas infrastructure development project;
(ii) an explanation of projected benefits from the proposed rural gas infrastructure
development project;
(iii) the estimated costs of the rural gas infrastructure development project; and
(iv) any other information the commission requires.
(3) In ruling on a request for approval of a resource decision, the commission shall
determine whether the decision:
(a) is reached in compliance with this chapter and rules made in accordance with Title
63G, Chapter 3, Utah Administrative Rulemaking Act; and
(b) is in the public interest, taking into consideration:
(i) 
(A)
 whether it will most likely result in the acquisition, production, and delivery of
utility services at the lowest reasonable cost to the retail customers of an energy utility located
in this state;
[
(ii)
] 
(B)
 long-term and short-term impacts;
[
(iii)
] 
(C)
 risk;
[
(iv)
] 
(D)
 reliability;
[
(v)
] 
(E)
 financial impacts on the energy utility; and
[
(vi)
] 
(F)
 other factors determined by the commission to be relevant[
.
]
; or
(ii) for a request for approval of rural gas infrastructure development:
(A) the potential benefits to previously unserved rural areas;
(B) the potential number of new customers;
(C) natural gas consumption; and
(D) revenues, costs, and other factors determined by the commission to be relevant.
(4) In a decision relating to a request for approval of rural gas infrastructure
development, the commission may determine that spreading all or a portion of the costs of the
rural gas infrastructure development to the larger customer base is in the public interest.
[
(4)
] 
(5)
 (a) If the commission approves a proposed resource decision only in part, the
commission shall explain in the order issued under this section why the commission does not
approve the resource decision in total.
(b) Recovery of expenses incurred in connection with parts of a resource decision that
are not approved is subject to the review of the commission as part of a rate hearing under
Section 
54-7-12
.
[
(5)
] 
(6)
 The commission may not approve a resource decision in whole or in part
under this section before holding a public hearing.
[
(6)
] 
(7)
 Unless the commission determines that additional time to analyze a resource
decision is warranted and is in the public interest, within 180 days of the day on which the
energy utility files a request for approval, the commission shall:
(a) approve all or part of the resource decision;
(b) approve all or part of the resource decision subject to conditions imposed by the
commission; or
(c) disapprove all or part of the resource decision.
[
(7)
] 
(8)
 The commission shall include in its order under this section:
(a) findings as to the approved projected costs of a resource decision; and
(b) the basis upon which the findings described in Subsection [
(7)
] 
(8)
(a) are made.
[
(8)
] 
(9)
 In accordance with Title 63G, Chapter 3, Utah Administrative Rulemaking
Act, the commission shall make rules regarding the process for approval of a resource decision
under this section.
Section 3. Section 
54-17-403
 is amended to read:
54-17-403.
Cost recovery.
(1) (a) Except as otherwise provided in this section, if the commission approves any
portion of an energy utility's resource decision under Section 
54-17-402
, the commission shall,
in a general rate case or other appropriate commission proceeding, include in the energy
utility's retail rates the state's share of costs:
(i) relevant to that proceeding;
(ii) incurred by the energy utility in implementing the approved resource decision; and
(iii) up to the projected costs specified in the commission's order issued under Section
54-17-402
.
(b) Except to the extent that the commission issues an order under Section 
54-17-404
,
any increase from the projected costs specified in the commission's order issued under Section
54-17-402
 shall be subject to review by the commission as part of a rate hearing under Section
54-7-12
.
(c) If the commission approves a request for approval of rural gas infrastructure
development under Section 
54-17-402
, the commission may approve the inclusion of rural gas
infrastructure development costs within the gas corporation's base rates if:
(i) the inclusion of those costs will not increase the base distribution non-gas revenue
requirement by more than 2% in any three-year period;
(ii) the distribution non-gas revenue requirement increase related to the infrastructure
development costs under Subsection (1)(c)(i) does not exceed 5% in the aggregate; and
(iii) the applicable distribution non-gas revenue requirement is the annual revenue
requirement determined in the gas corporation's most recent rate case.
(2) (a) Subsequent to the commission issuing an order described in Subsection (2)(a)(i)
or (ii), the commission may disallow some or all costs incurred in connection with an
approved resource decision if the commission finds that an energy utility's actions in
implementing an approved resource decision are not prudent because of new information or
changed circumstances that occur after:
(i) the commission approves the resource decision under Section 
54-17-402
; or
(ii) the commission issues an order to proceed under Section 
54-17-404
.
(b) In making a determination of prudence under Subsection (2)(a), the commission
shall use the standards identified in Section 
54-4-4
.
(3) Notwithstanding any other provision of this chapter, the commission may disallow
some or all of the costs incurred by an energy utility in connection with an approved resource
decision upon a finding by the commission that the energy utility is responsible for a material
misrepresentation or concealment in connection with an approval process under this chapter.