Working Draft 1 2 Bill No. General Assembly September Special Session, 2020 LCO No. 4202 Referred to Committee on Introduced by: REP. ARCONTI, 109th Dist. SEN. NEEDLEMAN, 33rd Dist. 1 2 3 4 5AN ACT CONCERNING EMERGENCY RESPONSE BY ELECTRIC 6DISTRIBUTION COMPANIES AND REVISING THE REGULATION OF 7OTHER PUBLIC UTILITIES. 8Be it enacted by the Senate and House of Representatives in 9General Assembly convened: 10 11 3 LCO No. 4202 4 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 1 of 23 WORKING DRAFT 5 Bill No. 6 12 Section 1. (NEW) (Effective from passage) (a) (1) For the 13purposes of this section, "electric distribution company" has 14the same meaning as provided in section 16-1 of the general 15statutes and "emergency" has the same meaning as provided 16in section 16-32e of the general statutes. 17 (2) "Resilience" means the ability to prepare for and adapt 18to changing conditions and withstand and recover rapidly 19from deliberate attacks, accidents or naturally occurring 20threats or incidents, including, but not limited to, threats or 21incidents associated with the impacts of climate change. 22 (b) Not later than June 1, 2021, the Public Utilities 23Regulatory Authority shall initiate a proceeding to investigate, 24develop and adopt a framework for implementing 25performance-based regulation of each electric distribution 26company. Such framework adopted by the authority shall: (1) 27Establish standards and metrics for measuring such electric 28distribution company's performance of objectives that are in 29the interest of ratepayers or benefit the public, which may 30include, but not be not limited to, safety, 31reliability, emergency response, cost efficiency, affordability, 32equity, customer satisfaction, municipal engagement, 33resilience and advancing the state's environmental and policy 34goals, including, but not limited to, those goals established in 35section 22a-200a of the general statutes, in the Integrated 36Resources Plan approved pursuant to section 16a-3a of the 37general statutes and in the Comprehensive Energy Strategy 38prepared pursuant to section 16a-3d of the general statutes; 39(2) identify the manner, including the timeframe and extent, 40in which such standards and metrics shall be used to apply 41the principles and guidelines set forth in section 16-19e of the 42general statutes and to determine the relative adequacy of 43the company's service and the reasonableness and adequacy 44of rates proposed and considered pursuant to section 16-19a 45of the general statutes; and (3) identify specific mechanisms 46to be implemented to align utility performance with the 7 LCO No. 4202 8 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 2 of 23 WORKING DRAFT 9 Bill No. 10 47standards and metrics adopted pursuant to this section and 48subsection (b) of section 16-19a of the general statutes, 49including, but not limited to, reviewing the effectiveness of 50the electric distribution company's revenue decoupling 51mechanism. The authority may also initiate a proceeding 52to investigate, develop and adopt a framework for 53implementation of performance-based regulation for gas and 54water companies, as defined by section 16-1 of the general 55statutes, consistent with the requirements and provisions of 56this section. 57 Sec. 2. Subsections (a) and (b) of section 16-19 of the 58general statutes are repealed and the following is substituted 59in lieu thereof (Effective from passage): 60 (a) No public service company may charge rates in excess 61of those previously approved by the Public Utilities Control 62Authority or the Public Utilities Regulatory Authority, except 63that any rate approved by the Public Utilities Commission, the 64Public Utilities Control Authority or the Public Utilities 65Regulatory Authority shall be permitted until amended by the 66Public Utilities Regulatory Authority, that rates not approved 67by the Public Utilities Regulatory Authority may be charged 68pursuant to subsection (b) of this section, and that the 69hearing requirements with respect to adjustment clauses are 70as set forth in section 16-19b. For water companies, existing 71rates shall include the amount of any adjustments approved 72pursuant to section 16-262w since the company's most recent 73general rate case, provided any adjustment amount shall be 74separately identified in any customer bill. Each public service 75company shall file any proposed amendment of its existing 76rates with the authority in such form and in accordance with 77such reasonable regulations as the authority may prescribe. 78Each electric distribution, gas or telephone company filing a 79proposed amendment shall also file with the authority an 80estimate of the effects of the amendment, for various levels of 81consumption, on the household budgets of high and moderate 11 LCO No. 4202 12 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 3 of 23 WORKING DRAFT 13 Bill No. 14 82income customers and customers having household incomes 83not more than one hundred fifty per cent of the federal 84poverty level. Each electric distribution company shall also file 85such an estimate for space heating customers. Each water 86company, except a water company that provides water to its 87customers less than six consecutive months in a calendar 88year, filing a proposed amendment, shall also file with the 89authority a plan for promoting water conservation by 90customers in such form and in accordance with a 91memorandum of understanding entered into by the authority 92pursuant to section 4-67e. Each public service company shall 93notify each customer who would be affected by the proposed 94amendment, by mail, at least one week prior to the first public 95hearing thereon, but not earlier than six weeks prior to such 96first public hearing, that an amendment has been or will be 97requested. Such notice shall also indicate (1) the date, time 98and location of any scheduled public hearing, (2) a statement 99that customers may provide written comments regarding the 100proposed amendment to the Public Utilities Regulatory 101Authority or appear in person at any scheduled public hearing, 102(3) the Public Utilities Regulatory Authority telephone number 103for obtaining information concerning the schedule for public 104hearings on the proposed amendment, and (4) whether the 105proposed amendment would, in the company's best estimate, 106increase any rate or charge by twenty per cent or more, and, 107if so, describe in general terms any such rate or charge and 108the amount of the proposed increase, provided no such 109company shall be required to provide more than one form of 110the notice to each class of its customers. In the case of a 111proposed amendment to the rates of any public service 112company, the authority shall hold one or more public hearings 113thereon, except as permitted with respect to interim rate 114amendments by subsections (d) and (g) of this section, and 115shall make such investigation of such proposed amendment of 116rates as is necessary to determine whether such rates 117conform to the principles and guidelines set forth in section 15 LCO No. 4202 16 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 4 of 23 WORKING DRAFT 17 Bill No. 18 11816-19e, or are unreasonably discriminatory or more or less 119than just, reasonable and adequate, or that the service 120furnished by such company is inadequate to or in excess of 121public necessity and convenience, provided the authority may 122(A) evaluate the reasonableness and adequacy of the 123performance or service of the public service company using 124any applicable metrics or standards adopted by the authority 125pursuant to section 1 of this act, and (B) determine the 126reasonableness of the allowed rate of return of the public 127service company based on such performance evaluation. The 128authority, if in its opinion such action appears necessary or 129suitable in the public interest may, and, upon written petition 130or complaint of the state, under direction of the Governor, 131shall, make the aforesaid investigation of any such proposed 132amendment which does not involve an alteration in rates. If 133the authority finds any proposed amendment of rates to not 134conform to the principles and guidelines set forth in section 13516-19e, or to be unreasonably discriminatory or more or less 136than just, reasonable and adequate to enable such company 137to provide properly for the public convenience, necessity and 138welfare, or the service to be inadequate or excessive, it shall 139determine and prescribe, as appropriate, an adequate service 140to be furnished or just and reasonable maximum rates and 141charges to be made by such company. In the case of a 142proposed amendment filed by an electric distribution, gas or 143telephone company, the authority shall also adjust the 144estimate filed under this subsection of the effects of the 145amendment on the household budgets of the company's 146customers, in accordance with the rates and charges 147approved by the authority. The authority shall issue a final 148decision on each electric distribution or gas company rate 149filing within [one] three hundred fifty days from the proposed 150effective date thereof. [, provided it may, before the end of 151such period and upon notifying all parties and intervenors to 152the proceedings, extend the period by thirty days.] The 153authority shall issue a final decision on all public service 19 LCO No. 4202 20 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 5 of 23 WORKING DRAFT 21 Bill No. 22 154company rate filings, except electric distribution or gas 155company rate filings, within two hundred days from the 156proposed effective date thereof. 157 (b) If the authority has not made its finding respecting an 158amendment of any electric distribution or gas company rate 159within [one] three hundred fifty days from the proposed 160effective date of such amendment thereof, or [within one 161hundred eighty days if the authority extends the period in 162accordance with the provisions of subsection (a) of this 163section] if the authority has not made its finding respecting an 164amendment of any public service company rate, except 165electric distribution or gas company rate, within two hundred 166days from the proposed effective date of such amendment 167thereof, such amendment may become effective pending the 168authority's finding with respect to such amendment upon the 169filing by the company with the authority of assurance 170satisfactory to the authority, which may include a bond with 171surety, of the company's ability and willingness to refund to 172its customers with interest such amounts as the company 173may collect from them in excess of the rates fixed by the 174authority in its finding or fixed at the conclusion of any appeal 175taken as a result of a finding by the authority. 176 Sec. 3. Subsections (a) and (b) of section 16-19a of the 177general statutes are repealed and the following is substituted 178in lieu thereof (Effective November 1, 2020): 179 (a) (1) The Public Utilities Regulatory Authority shall, at 180intervals of not more than four years from the last previous 181general rate hearing of each gas and electric distribution 182company having more than seventy-five thousand customers, 183conduct a complete review and investigation of the financial 184and operating records of each such company and hold a 185public hearing to determine whether the rates of each such 186company are unreasonably discriminatory or more or less 187than just, reasonable and adequate, or that the service 23 LCO No. 4202 24 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 6 of 23 WORKING DRAFT 25 Bill No. 26 188furnished by such company is inadequate to or in excess of 189public necessity and convenience or that the rates do not 190conform to the principles and guidelines set forth in section 19116-19e. In making such determination, the authority shall 192consider the gross and net earnings of such company since its 193last previous general rate hearing, its retained earnings, its 194actual and proposed capital expenditures, its advertising 195expenses, the dividends paid to its stockholders, the rate of 196return paid on its preferred stock, bonds, debentures and 197other obligations, its credit rating, and such other financial 198and operating information as the authority may deem 199pertinent. 200 (2) The authority may conduct a general rate hearing in 201accordance with subsection (a) of section 16-19, in lieu of the 202periodic review and investigation proceedings required under 203subdivision (1) of this subsection. 204 (b) In [the] any proceeding required under subdivision (1) 205of subsection (a) of this section, or in any rate hearing 206pursuant to section 16-19, the authority [may approve 207performance-based incentives to encourage a gas or electric 208distribution company to operate efficiently and provide high 209quality service at fair and reasonable prices] shall consider 210the implementation of financial performance-based incentives 211and penalties and performance-based metrics. 212Notwithstanding subsection (a) of this section, if the authority 213approves such performance-based incentives and penalties 214for a particular company, the authority shall include in such 215approval a framework for periodic monitoring and review of 216the company's performance [in regard to criteria specified by 217the authority, which shall include, but not be limited to, the 218company's return on equity, reliability and quality of service. 219The authority's periodic monitoring and review shall be used 220in lieu of the periodic review and investigation proceedings 221required under subdivision (1) of subsection (a) of this section. 222If the authority determines in the periodic monitoring and 27 LCO No. 4202 28 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 7 of 23 WORKING DRAFT 29 Bill No. 30 223review that a more extensive review of company performance 224is necessary, the authority may institute a further proceeding 225in accordance with the purposes of this chapter, including a 226complete review and investigation described in subdivision (1) 227of subsection (a) of this section] pursuant to metrics 228developed by the authority. 229 Sec. 4. (NEW) (Effective from passage) Notwithstanding any 230provision of the general statutes, in exercising its discretion 231regarding whether to allow the recovery through rates of any 232portion of the compensation package for executives or officers 233or of any portion of any incentive compensation for 234employees of any electric distribution company, gas company 235or water company, as defined in section 16-1 of the general 236statutes, the Public Utilities Regulatory Authority shall 237consider whether to require that any such compensation that 238is recoverable through rates be dependent upon the 239achievement of performance targets established pursuant to 240section 1 of this act. 241 Sec. 5. (NEW) (Effective from passage) Not later than 242November 1, 2020, the Public Utilities Regulatory Authority 243may initiate a proceeding or proceedings to consider the 244implementation of an interim rate decrease, low-income rates 245and economic development rates for customers of electric 246distribution companies, pursuant to its authority in subsection 247(g) of section 16-19 of the general statutes and sections 1624819e and 16-19oo of the general statutes. 249 Sec. 6. Subsection (b) of section 16-43 of the general 250statutes is repealed and the following is substituted in lieu 251thereof (Effective November 1, 2020): 252 (b) A public service company shall obtain the approval of 253the Public Utilities Regulatory Authority to (1) issue any notes, 254bonds or other evidences of indebtedness or securities of any 255nature, (2) lend or borrow any moneys for a period of more 31 LCO No. 4202 32 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 8 of 23 WORKING DRAFT 33 Bill No. 34 256than one year for any purpose other than paying the 257expenses, including taxes, of conducting its business or for 258the payment of dividends, or (3) amend any provision of an 259indenture or similar financial instrument if such amendment 260would affect the issuance or terms of any such notes, bonds 261or other evidences of indebtedness or securities. The 262authority shall approve or disapprove each such issue or 263amendment within [thirty] sixty days after the filing of a 264written application for such approval unless the applicant 265agrees to an extension of time. If not disapproved within said 266[thirty] sixty days or within such extension, such issue shall 267be deemed to be approved. The authority shall not require a 268company to issue its common stock under terms or conditions 269not required by the general statutes. The provisions of this 270subsection shall apply to a community antenna television 271company only with regard to any noncable communications 272services which the company may provide. 273 Sec. 7. Subsection (d) of section 16-47 of the general 274statutes is repealed and the following is substituted in lieu 275thereof (Effective January 1, 2021): 276 (d) The Public Utilities Regulatory Authority shall investigate 277and hold a public hearing on the question of granting its 278approval with respect to any application made under 279subsection (b) or (c) of this section and thereafter may 280approve or disapprove any such application in whole or in part 281and upon such terms and conditions as it deems necessary or 282appropriate. In connection with its investigation, the authority 283may request the views of the gas, electric distribution, water, 284telephone or community antenna television company or 285holding company which is the subject of the application with 286respect to the proposed acquisition. After the filing of an 287application satisfying the requirements of such regulations as 288the authority may adopt in accordance with the provisions of 289chapter 54, but not later than thirty business days after the 290filing of such application, the authority shall give prompt 35 LCO No. 4202 36 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 9 of 23 WORKING DRAFT 37 Bill No. 38 291notice of the public hearing to the person required to file the 292application and to the subject company or holding company. 293Such hearing shall be commenced as promptly as practicable 294after the filing of the application, but not later than [thirty] 295sixty business days after the filing, and the authority shall 296make its determination as soon as practicable, but not later 297than [one] two hundred [twenty] days after the filing of the 298application, provided it may, before the end of such period 299and upon notifying all parties and intervenors to the 300proceedings, extend the period by thirty days, or unless the 301person required to file the application agrees to an extension 302of time. The authority may, in its discretion, grant the subject 303company or holding company the opportunity to participate in 304the hearing by presenting evidence and oral and written 305argument. If the authority fails to give notice of its 306determination to hold a hearing, commence the hearing, or 307render its determination after the hearing within the time 308limits specified in this subdivision, the proposed acquisition 309shall be deemed approved. In each proceeding on a written 310application submitted under said subsection (b) or (c), the 311authority shall, in a manner which treats all parties to the 312proceeding on an equal basis, take into consideration (1) the 313financial, technological and managerial suitability and 314responsibility of the applicant, (2) the ability of the gas, 315electric distribution, water, telephone or community antenna 316television company or holding company which is the subject 317of the application to provide safe, adequate and reliable 318service to the public through the company's plant, equipment 319and manner of operation if the application were to be 320approved, and (3) for an application concerning a telephone 321company, the effect of approval on the location and 322accessibility of management and operations and on the 323proportion and number of state resident employees. On and 324after January 1, 2021, the authority shall only grant its 325approval of an application made under subsection (c) of this 326section if the holding company effects a change in the 39 LCO No. 4202 40 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 10 of 23 WORKING DRAFT 41 Bill No. 42 327composition of the board of directors to include a proportional 328percentage of Connecticut-based directors equivalent to the 329percentage that Connecticut service areas represent of the 330total service areas covered by the holding company. 331 Sec. 8. Section 16-243p of the general statutes is repealed 332and the following is substituted in lieu thereof (Effective 333November 1, 2020): 334 (a) An electric distribution company may recover its costs 335and investments that have been prudently incurred as well as 336its revenues lost resulting from the provisions of sections 163371, 16-19ff, 16-50k, 16-50x, 16-243h to 16-243q, inclusive, 16338244c, 16-244u, 16-244x, 16-245d, 16-245m, 16-245n, 16339245z, 16-262i, 16a-40l and 16a-40m and section 21 of public 340act 05-1 of the June special session. The Public Utilities 341Regulatory Authority shall, after a hearing held pursuant to 342the provisions of chapter 54, determine the appropriate 343mechanism to obtain such recovery in a timely manner which 344mechanism may be one or more of the following: (1) Approval 345of rates as provided in sections 16-19 and 16-19e; (2) the 346energy adjustment clause as provided in section 16-19b; or 347(3) the federally mandated congestion charges, as defined in 348section 16-1. 349 (b) No electric distribution company shall recover its costs 350associated with its attendance or participation in any rate351making hearing before the authority. 352 [(b)] (c) Electric distribution companies shall be authorized 353to earn an incentive, as provided in section 16-19kk, for costs 354prudently incurred by such companies pursuant to this 355section. 356 Sec. 9. Section 16-32i of the general statutes is repealed 357and the following is substituted in lieu thereof (Effective from 358passage): 43 LCO No. 4202 44 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 11 of 23 WORKING DRAFT 45 Bill No. 46 359 The Public Utilities Regulatory Authority shall review the 360performance of each electric distribution company and gas 361company, as those terms are defined in section 16-1, after 362any emergency, as defined in section 16-32e, (1) in which 363more than ten per cent of any such company's customers 364were without service for more than forty-eight consecutive 365hours, or (2) at the authority's discretion. The authority, upon 366a finding that any such company failed to comply with any 367standard of acceptable performance in emergency 368preparation or restoration of service in an emergency, 369adopted pursuant to section 16-32h, or with any order of the 370authority, shall make orders, after a hearing that is conducted 371as a contested case in accordance with chapter 54, to enforce 372such standards or orders and may levy civil penalties against 373such company, pursuant to section 16-41, not to exceed a 374total of [two and one-half] four per cent of such electric 375distribution or gas company's annual distribution revenue, for 376noncompliance in any such emergency. In determining the 377amount of any penalty, the authority shall consider whether 378such company received approval and reasonable funding 379allowances, as determined by the authority, from the 380authority to meet infrastructure resiliency efforts to improve 381such company's performance. Any such penalty shall be 382assessed in the form of [a credit to] credits to the accounts of 383ratepayers of such electric distribution or gas company. Any 384such penalty shall not be included as an operating expense of 385such company for purposes of ratemaking. 386 Sec. 10. (NEW) (Effective from passage) (a) For the 387purposes of this section, "emergency" has the same meaning 388as provided in subdivision (1) of subsection (a) of section 1638932e of the general statutes and "electric distribution 390company" has the same meaning as provided in section 16-1 391of the general statutes. 392 (b) Notwithstanding any other provision of the general 393statutes, on and after July 1, 2021, each electric distribution 47 LCO No. 4202 48 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 12 of 23 WORKING DRAFT 49 Bill No. 50 394company shall provide to residential customers of such 395company a credit of twenty-five dollars, on the balance of 396such customer's account, for each day of distribution-system 397service outage that occurs for such customers for more than 398ninety-six consecutive hours after the occurrence of an 399emergency. 400 (c) Any costs incurred by an electric distribution company 401pursuant to this section shall not be recoverable. 402 (d) Not later than fourteen calendar days after the 403occurrence of an emergency, an electric distribution company 404may petition the authority for a waiver of the requirements of 405this section. Any petition for a waiver made under this 406subsection shall include the severity of the emergency, 407employee safety issues and conditions on the ground, and 408shall be conducted as a contested case proceeding. The 409burden of proving that such waiver is reasonable and 410warranted shall be on the electric distribution company. In 411determining whether to grant such waiver, the authority shall 412consider whether the electric distribution company received 413approval and reasonable funding allowances, as determined 414by the authority, to meet infrastructure resiliency efforts to 415improve such company's performance. 416 (e) On or before January 1, 2021, the Public Utilities 417Regulatory Authority shall initiate a proceeding to consider 418the implementation of the residential customer credit and 419waiver provisions of this section and establish circumstances, 420standards and methodologies applicable to each electric 421distribution company and necessary to implement the 422provisions of this section, including any modifications to the 423ninety-six-consecutive-hour standard in subsection (b) of this 424section. The authority shall issue a final decision in such 425proceeding on or before July 1, 2021. Sec. 11. (NEW) (Effective from passage) (a) For the 426 51 LCO No. 4202 52 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 13 of 23 WORKING DRAFT 53 Bill No. 54 427purposes of this section, "emergency" has the same meaning 428as provided in subdivision (1) of subsection (a) of section 1642932e of the general statutes and "electric distribution 430company" has the same meaning as provided in section 16-1 431of the general statutes. 432 (b) On and after July 1, 2021, each electric distribution 433company shall provide to each residential customer 434compensation in an amount of two hundred fifty dollars, in the 435aggregate, for any medication and food that expires or spoils 436due to a distribution-system service outage that lasts more 437than ninety-six consecutive hours in duration after the 438occurrence of an emergency. 439 (c) Any costs incurred by an electric distribution company 440pursuant to this section shall not be recoverable. 441 (d) Not later than fourteen calendar days after the 442occurrence of an emergency, an electric distribution company 443may petition the authority for a waiver of the requirements of 444this section. Any petition for a waiver made under this 445subsection shall include the severity of the emergency, 446employee safety issues and conditions on the ground, and 447shall be conducted as a contested case proceeding. The 448burden of proving that such waiver is reasonable and 449warranted shall be on the electric distribution company. In 450determining whether to grant such waiver, the authority shall 451consider whether the electric distribution company received 452approval and reasonable funding allowances, as determined 453by the authority, to meet infrastructure resiliency efforts to 454improve such company's performance. 455 (e) On or before January 1, 2021, the Public Utilities 456Regulatory Authority shall initiate a proceeding to consider 457the implementation of the compensation reimbursement and 458waiver provisions of this section and establish circumstances, 459standards and methodologies applicable to each electric 55 LCO No. 4202 56 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 14 of 23 WORKING DRAFT 57 Bill No. 58 460distribution company and necessary to implement the 461provisions of this section, including any modifications to the 462ninety-six-consecutive-hour standard in subsection (b) of this 463section. The authority shall issue a final decision in such 464proceeding on or before July 1, 2021. 465 Sec. 12. (NEW) (Effective from passage) (a) As used in this 466section, "electric distribution company" has the same 467meaning as provided in section 16-1 of the general statutes. 468 (b) Not later than January 1, 2021, each electric distribution 469company shall submit to the joint standing committee of the 470General Assembly having cognizance of matters relating to 471energy, in accordance with the provisions of section 11-4a of 472the general statutes, and the Public Utilities Regulatory 473Authority the following: 474 (1) A cost-benefit analysis identifying the resources 475expended in response to the last five storm events classified 476as a level three, four or five. Such analysis shall include a 477review of the number of line crew workers and shall 478distinguish between line crew workers (A) directly employed 479by the electric distribution company and working full time 480within the state, (B) directly employed by the electric 481distribution company working primarily in another state, and 482(C) hired as contractors or subcontractors. 483 (2) An analysis of any such company's (A) estimates 484concerning potential damage and service outages prior to the 485last five storm events classified as a level three, four or five, 486(B) damage and service outage assessments after the last five 487storm events classified as a level three, four or five, (C) 488restoration management after the last five storm events 489classified as a level three, four or five, including access to 490alternate restoration resources via regional and reciprocal aid 491contracts, (D) planning for at-risk and vulnerable customers, 492(E) communication policies with state and local officials and 59 LCO No. 4202 60 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 15 of 23 WORKING DRAFT 61 Bill No. 62 493customers, including individual customer restoration 494estimates and the accuracy of such estimates, (F) 495infrastructure, facilities and equipment, which shall include, 496but not be limited to, an examination of (i) whether such 497infrastructure, facilities and equipment are in good repair and 498capable of meeting operational standards, (ii) whether such 499company is following standard industry practice concerning 500operation and maintenance of such infrastructure, facilities 501and equipment, (iii) the age and condition of such 502infrastructure, facilities and equipment, (iv) whether 503maintenance of such infrastructure, facilities and equipment 504has been delayed, and (v) whether such company had access 505to adequate replacement equipment for such infrastructure, 506facilities and equipment during the course of the last five 507storm events classified as a level three, four or five, and (G) 508compliance with any emergency response standards adopted 509by the authority. 510 (c) Not later than January 1, 2021, the authority shall 511initiate a docket, or incorporate into an existing docket, to 512review the report provided by each electric distribution 513company pursuant to subsection (b) of this section. The 514authority shall submit the final decision of such docket, in 515accordance with the provisions of section 11-4a of the general 516statutes, to the joint standing committee of the General 517Assembly having cognizance of matters relating to energy. 518 (d) After issuing its final decision in the docket initiated 519pursuant to subsection (c) of this section, the authority shall 520establish standards for minimum staffing levels for any 521electric distribution company for outage planning and 522restoration personnel, including linemen, technicians and 523system engineers, tree trimming crews and personnel 524responsible for directing operations and communicating with 525state, municipal and regional officials. Such staffing standards 526may reflect different staffing levels based on the severity of 527any emergency. 63 LCO No. 4202 64 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 16 of 23 WORKING DRAFT 65 Bill No. 66 528 (e) The authority may establish as it deems fit any other 529standards for acceptable performance by any electric 530distribution company to ensure the reliability of such 531company's services in any emergency and to prevent, 532minimize and restore any long-term service outages or 533disruptions caused by such emergency. 534 (f) The authority, upon a finding that any electric 535distribution company failed to comply with any standard of 536acceptable performance adopted pursuant to this section or 537any order of the authority, shall make orders to enforce such 538standards and may levy civil penalties against such company, 539pursuant to section 16-41 of the general statutes. Any such 540penalty shall not be included as an operating expense of such 541company for purposes of ratemaking. 542 Sec. 13. Subsection (a) of section 16-41 of the general 543statutes is repealed and the following is substituted in lieu 544thereof (Effective from passage): 545 (a) Each (1) public service company and its officers, agents 546and employees, (2) electric supplier or person providing 547electric generation services without a license in violation of 548section 16-245, and its officers, agents and employees, (3) 549certified telecommunications provider or person providing 550telecommunications services without authorization pursuant 551to sections 16-247f to 16-247h, inclusive, and its officers, 552agents and employees, (4) person, public agency or public 553utility, as such terms are defined in section 16-345, subject to 554the requirements of chapter 293, (5) person subject to the 555registration requirements under section 16-258a, (6) cellular 556mobile telephone carrier, as described in section 16-250b, (7) 557Connecticut electric efficiency partner, as defined in section 55816-243v, (8) company, as defined in section 16-49, and (9) 559entity approved to submeter pursuant to section 16-19ff shall 560obey, observe and comply with all applicable provisions of this 561title and each applicable order made or applicable regulations 67 LCO No. 4202 68 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 17 of 23 WORKING DRAFT 69 Bill No. 70 562adopted by the Public Utilities Regulatory Authority by virtue 563of this title as long as the same remains in force. Any such 564company, electric supplier, certified telecommunications 565provider, cellular mobile telephone carrier, Connecticut 566electric efficiency partner, entity approved to submeter, 567person, any officer, agent or employee thereof, public agency 568or public utility which the authority finds has failed to obey or 569comply with any such provision of this title, order or regulation 570shall be fined, ordered to pay restitution to customers or 571ordered to pay a combination of a fine and restitution by order 572of the authority in accordance with the penalty prescribed for 573the violated provision of this title or, if no penalty is 574prescribed, not more than ten thousand dollars for each 575offense, except that the penalty shall be a fine, restitution to 576customers or a combination of a fine and restitution of not 577more than forty thousand dollars for failure to comply with an 578order of the authority made in accordance with the provisions 579of section 16-19 or 16-247k or within thirty days of such order 580or within any specific time period for compliance specified in 581such order. The authority may direct a portion of any fine 582levied pursuant to this section to be paid to a nonprofit 583agency engaged in energy assistance programs named by the 584authority in its decision or notice of violation. Each distinct 585violation of any such provision of this title, order or regulation 586shall be a separate offense and, in case of a continued 587violation, each day thereof shall be deemed a separate 588offense. Each such penalty and any interest charged pursuant 589to subsection (g) or (h) of section 16-49 shall be excluded 590from operating expenses for purposes of rate-making. 591 Sec. 14. (NEW) (Effective from passage) Not later than 592January 15, 2021, the Commissioner of Energy and 593Environmental Protection shall submit a report to the joint 594standing committee of the General Assembly having 595cognizance of matters relating to energy (1) evaluating 596whether Connecticut's reliance on the wholesale energy 71 LCO No. 4202 72 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 18 of 23 WORKING DRAFT 73 Bill No. 74 597markets administered by the regional independent system 598operator, as defined in section 16-1 of the general statutes, 599benefits Connecticut ratepayers, and (2) recommending 600alternative approaches to better meet Connecticut's need for 601clean, reliable and affordable electricity generation supply in a 602manner that leverages competition, reduces ratepayer risk 603and achieves the state's public policy goals, including, but not 604limited to, pursuant to section 22a-200a of the general 605statutes. 606 Sec. 15. Section 16-243y of the general statutes is repealed 607and the following is substituted in lieu thereof (Effective from 608passage): (a) As used in this section: 609 610 (1) "Municipality" has the same meaning as provided in 611section 7-233b; 612 (2) "Critical facility" means any hospital, police station, fire 613station, water treatment plant, sewage treatment plant, public 614shelter, correctional facility or production and transmission 615facility of a television or radio station, whether broadcast, 616cable or satellite, licensed by the Federal Communications 617Commission, any commercial area of a municipality, a 618municipal center, as identified by the chief elected official of 619any municipality, or any other facility or area identified by the 620Department of Energy and Environmental Protection as 621critical; 622 (3) "Distributed energy generation" means the generation 623of electricity from a unit with a rating of not more than sixty624five megawatts on the premises of a retail end user within the 625transmission and distribution system; 626 (4) "Electric distribution company" and "participating 627municipal electric utility" have the same meanings as 628provided in section 16-1; [and] 75 LCO No. 4202 76 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 19 of 23 WORKING DRAFT 77 Bill No. 78 629 (5) "Microgrid" means a group of interconnected loads and 630distributed energy resources within clearly defined electrical 631boundaries that acts as a single controllable entity with 632respect to the grid and that connects and disconnects from 633such grid to enable it to operate in both grid-connected or 634island mode; [.] 635 (6) "Resilience" means the ability to prepare for and adapt 636to changing conditions and withstand and recover rapidly 637from deliberate attacks, accidents or naturally occurring 638threats or incidents, including, but not limited to, threats or 639incidents associated with the impacts of climate change; and 640 (7) "Vulnerable communities" means populations that may 641be disproportionately impacted by the effects of climate 642change, including, but not limited to, low and moderate 643income communities, environmental justice communities 644pursuant to section 22a-20a, communities eligible for 645community reinvestment pursuant to section 36a-30 and the 646Community Reinvestment Act of 1977, 12 USC 2901 et seq., 647as amended from time to time, populations with increased risk 648and limited means to adapt to the effects of climate change, 649or as further defined by the Department of Energy and 650Environmental Protection in consultation with community 651representatives. 652 (b) The Department of Energy and Environmental Protection 653shall establish a microgrid and resilience grant and loan pilot 654program to support local distributed energy generation for 655critical facilities or resilience projects. The department shall 656develop and issue a request for proposals from municipalities, 657electric distribution companies, participating municipal 658electric utilities, energy improvement districts, and nonprofit, 659academic and private entities seeking to develop microgrid 660distributed energy generation, or to repurpose existing 661distributed energy generation for use with microgrids, to 662support critical facilities or to develop resilience projects. Any 79 LCO No. 4202 80 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 20 of 23 WORKING DRAFT 81 Bill No. 82 663entity eligible to submit a proposal pursuant to this section 664may collaborate with any other such entity in submitting such 665proposal. The department may hire a technical consultant to 666support the implementation of this section using any bond 667funds authorized in support of microgrids or resilience. 668 (c) The department shall award grants or loans under the 669microgrid and resilience grant and loan pilot program to any 670number of recipients. The department shall prioritize 671proposals that benefit vulnerable communities. To the extent 672possible, the amount of loans and grants awarded under the 673program shall be evenly distributed between small, medium 674and large municipalities. Such grants and loans may provide: 675(1) Assistance with community planning that includes, but is 676not limited to, microgrid or resilience project feasibility, 677including benefit-cost analyses, (2) assistance to recipients for 678the cost of design, engineering services and interconnection 679infrastructure for any such microgrid [, and (2)] or resilience 680project, (3) matching funds or low interest loans for an energy 681storage system or systems, as defined in section 16-1, or 682distributed energy generation projects first placed in service 683on or after July 1, 2016, provided such generation is derived 684from a Class I renewable energy source, as defined in section 68516-1, or a Class III energy source, as defined in section 16-1, 686for any such microgrid or resilience project, and (4) nonfederal 687cost share for grant or loan applications for projects or 688programs that include microgrids or resilience. The 689department may establish any financing mechanism to 690provide or leverage additional funding to support the 691development of interconnection infrastructure, distributed 692energy generation, [and] microgrids and resilience projects. 693 (d) Not later than January first, annually, for a period of five 694years after receiving a grant or loan under the microgrid and 695resilience grant and loan pilot program, the recipient of such 696grant or loan shall submit a report to the Public Utilities 697Regulatory Authority, the Office of Consumer Counsel and the 83 LCO No. 4202 84 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 21 of 23 WORKING DRAFT 85 Bill No. 86 698Department of Energy and Environmental Protection and, in 699accordance with section 11-4a, to the joint standing 700committees of the General Assembly having cognizance of 701matters relating to appropriations and energy. Such report 702shall include information concerning the status of such 703recipient's microgrid or resilience project. 704 [(e) On or before January 1, 2013, the department shall file 705a report, in accordance with the provisions of section 11-4a, 706with the joint standing committee of the General Assembly 707having cognizance of matters relating to energy, identifying 708other funding sources necessary to expand the microgrid 709grant and loan pilot program established pursuant to this 710section and any legislative changes necessary to access such 711funding.] 712 [(f)] (e) The Department of Energy and Environmental 713Protection, in consultation with the Connecticut Academy of 714Science and Engineering, shall study the methods of providing 715reliable electric services to critical facilities, taking into 716consideration the location of such critical facilities. Such study 717shall evaluate the costs and benefits of such methods, 718including, but not limited to, the use of microgrids, 719undergrounding and portable turbine generation, and shall 720make recommendations identifying the most cost-effective 721and reliable of such methods. Not later than January 1, 2013, 722the department shall submit the findings of such study, in 723accordance with section 11-4a, to the joint standing 724committee of the General Assembly having cognizance of 725matters relating to energy and technology. 87 LCO No. 4202 88 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 22 of 23 WORKING DRAFT 89 Bill No. 90 This act shall take effect as follows and shall amend the following sections: Section 1 Sec. 2 Sec. 3 Sec. 4 Sec. 5 Sec. 6 Sec. 7 Sec. 8 Sec. 9 Sec. 10 Sec. 11 Sec. 12 Sec. 13 Sec. 14 Sec. 15 from passage from passage November 1, 2020 from passage from passage November 1, 2020 January 1, 2021 November 1, 2020 from passage from passage from passage from passage from passage from passage from passage New section 16-19(a) and (b) 16-19a(a) and (b) New section New section 16-43(b) 16-47(d) 16-243p 16-32i New section New section New section 16-41(a) New section 16-243y 726 91 LCO No. 4202 92 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 23 of 23 Working Draft 1 2 Bill No. General Assembly September Special Session, 2020 LCO No. 4202 Referred to Committee on Introduced by: REP. ARCONTI, 109th Dist. SEN. NEEDLEMAN, 33rd Dist. 1 2 3 4 5AN ACT CONCERNING EMERGENCY RESPONSE BY ELECTRIC 6DISTRIBUTION COMPANIES AND REVISING THE REGULATION OF 7OTHER PUBLIC UTILITIES. 8Be it enacted by the Senate and House of Representatives in 9General Assembly convened: 10 11 3 LCO No. 4202 4 {/tmp/d20200930-2556-13e67xo/Energy-Bill-4202.docx } 1 of 23