[Congressional Bills 108th Congress]
[From the U.S. Government Publishing Office]
[S. 954 Introduced in Senate (IS)]
108th CONGRESS
1st Session
S. 954
To amend the Federal Power Act to provide for the protection of
electric utility customers and enhance the stability of wholesale
electric markets through the clarification of State regulatory
jurisdiction.
_______________________________________________________________________
IN THE SENATE OF THE UNITED STATES
April 30, 2003
Mr. Shelby (for himself, Mr. Miller, Mr. Lott, Ms. Landrieu, Mr.
Sessions, Mr. Cochran, and Mr. Chambliss) introduced the
following bill; which was read twice and referred to the
Committee on Energy and Natural ResourcesYYYYYYYYYYYYYYYYYYYYYY
_______________________________________________________________________
A BILL
To amend the Federal Power Act to provide for the protection of
electric utility customers and enhance the stability of wholesale
electric markets through the clarification of State regulatory
jurisdiction.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. BUNDLED RETAIL SALES OF ELECTRIC ENERGY.
(a) Jurisdiction.--Section 201(b)(1) of the Federal Power Act (16
U.S.C. 824(b)(1)) is amended--
(1) by striking ``(b)(1) The'' and inserting the following:
``(b) Applicability.--
``(1) In general.--The'';
(2) by striking ``The Commission'' and inserting the
following:
``(2) Facilities.--The Commission''; and
(3) by adding at the end the following:
``(3) Bundled retail sales of electric energy.--The
Commission shall not have jurisdiction--
``(A) over bundled retail sales of electric energy
(including the transmission component of retail sales);
or
``(B) to compel the unbundling of rates for bundled
retail sales of electric energy.''.
(b) Definition of Bundled Retail Sales of Electric Energy.--Section
201 of the Federal Power Act (16 U.S.C. 824) is amended by adding at
the end the following:
``(h) Definition of Bundled Retail Sales of Electric Energy.--In
this part, the term `bundled retail sales of electric energy' means
sales of electric energy to retail customers in which generation,
transmission, distribution, and other services necessary to supply
electric energy to retail customers are sold as a single delivered
service by a single seller, acting under the regulatory jurisdiction of
a State commission.''.
SEC. 2. SERVICE OBLIGATION PROTECTION.
Part II of the Federal Power Act (16 U.S.C. 824 et seq.) is amended
at the end the following:
``SEC. 215. SERVICE OBLIGATIONS OF LOAD-SERVING ENTITIES.
``(a) Definitions.--In this section:
``(1) Existing wholesale contractual obligation.--
``(A) In general.--The term `existing wholesale
contractual obligation' means an obligation under a
firm long-term wholesale contract that was in effect on
March 28, 2003.
``(B) Contract modifications.--A contract
modification after March 28, 2003 (other than a
contract modification that increases the quantity of
electric energy sold under the contract), shall not
affect the status of a contract described in
subparagraph (A) as an existing wholesale contractual
obligation.
``(2) Load-serving entity.--
``(A) In general.--The term `load-serving entity'
means a transmitting utility that has an obligation
under Federal, State, or local law, or a long-term
contract, to provide electric service to--
``(i) electric consumers (as defined in
section 3 of the Public Utility Regulatory
Policies Act of 1978 (16 U.S.C. 2602)); or
``(ii) an electric utility (as defined in
section 3 of that Act) that has an obligation
to provide electric service to electric
consumers.
``(B) Service obligation.--For purposes of this
section, an obligation described in subparagraph (A)
shall be considered a service obligation.
``(b) Service Obligations.--
``(1) Applicability.--This subsection applies to any load-
serving entity that--
``(A) owns transmission facilities for the
transmission of electric energy in interstate commerce
used to purchase or deliver electric energy to meet a
service obligation to customers or an existing
wholesale contractual obligation; or
``(B) holds a contract or service agreement for
firm transmission service used to purchase or deliver
electric energy to meet a service obligation to
customers or an existing wholesale contractual
obligation.
``(2) Use of transmission facilities or services.--In
exercising authority under this Act, the Commission shall
ensure that any entity described in paragraph (1) shall be
entitled to use transmission facilities or rights to firm
transmission service described in paragraph (1) to meet service
obligations described in paragraph (1) before transmission
capacity is made available for other uses.
``(c) Use by Successors in Interest.--
``(1) In general.--If all or a portion of the service
obligation or contractual obligation described in subsection
(b) is transferred to another load-serving entity, the
successor shall be entitled to use the transmission facilities
or firm transmission rights associated with the transferred
service obligation consistent with subsection (b).
``(2) Subsequent transfers.--A subsequent transfer to
another load-serving entity, or a retransfer to the original
load-serving entity, shall be entitled as provided in paragraph
(1).
``(d) Relationship to Other Provisions.--If a transmitting utility
reserves transmission capacity (or reserves the equivalent capacity in
the form of tradable transmission rights) to meet service obligations
or firm long-term wholesale contractual obligations under subsection
(b), the transmitting utility shall not be considered to be engaging in
undue discrimination or preference under this Act or any other law.
``(e) Applicability.--This section does not apply to an area served
by a utility located in an area described in section 212(k)(2)(B).
``(f) Savings Clause.--Nothing in this section alters or affects
the allocation of transmission rights approved by the Commission before
the date of enactment of this section by an independent system operator
or regional transmission organization.''.
SEC. 3. COST ALLOCATION.
Section 205 of the Federal Power Act (16 U.S.C. 824d) is amended by
adding at the end the following:
``(g) Cost Allocation.--
``(1) Applicability.--This subsection applies to any rule
or order of general applicability issued by the Commission
under this Act that--
``(A) requires the physical connection of any
cogeneration facility, any small power production
facility, any other electric power generation facility
that makes wholesale sales of electric power, or the
transmission facilities of any electric utility, with
the facilities of any electric utility, Federal power
marketing agency, geothermal power producer (including
a producer that is not an electric utility), qualifying
cogenerator, or qualifying small power producer; or
``(B) setting rates for transmission service.
``(2) Costs.--Any order or rule described in paragraph (1)
shall require that the applicant seeking the interconnection of
facilities or transmission service to pay--
``(A) the necessary and reasonable costs of any new
facility required to provide the interconnection or
transmission service that would not have been necessary
absent the interconnection or transmission service
request;
``(B) an equitable share of the fixed costs of the
existing system necessary to complete the
interconnection or transmission service transaction;
and
``(C) the costs of any other services that are
ancillary to the interconnection or transmission
service transaction.
``(3) Transmission service credits.--The requestor of
interconnection or transmission service shall not be entitled
to transmission service credits as a result of payments made
under this subsection.''.
SEC. 4. STANDARD MARKET DESIGN RULE.
Section 206 of the Federal Power Act (16 U.S.C. 824i) (as amended
by section 3) is amended by adding at the end the following:
``(g) Standard Market Design Rule.--
``(1) Definition of standard market design rule.--In this
subsection, the term `standard market design rule' means--
``(A) a rule promulgated pursuant to the notice of
proposed rulemaking issued by the Commission on July
31, 2002, in Docket No. RM01-12-0000, including any
modification of the rule that is within the scope of
the notice; or
``(B) any rule or order of general applicability
under this Act that addresses transmission access or
market design and in which the Commission--
``(i) asserts jurisdiction over the
transmission component of bundled retail sales
of electric energy; or
``(ii) requires the transfer of ownership,
operation, or control of transmission
facilities to a regional transmission
organization, independent transmission
provider, or similar organization.
``(2) Effectiveness.--Except as provided in paragraph (3),
a standard market design rule shall not be effective except to
the extent that the standard market design rule is approved by
Congress in a law enacted after the date of enactment of this
subsection.
``(3) State consent.--A standard market design rule that is
otherwise valid under this Act may take effect in a region
consisting entirely of States the State Commission has
consented in writing to the application of the standard market
design rule in the State.''.
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