Senate Committee OKs Bill To Authorize Alternative Energy, Water Utility Ratemaking To Encourage Conservation, Infrastructure Investment

The Senate Consumer Protection and Professional Licensure Committee Wednesday reported out House Bill 1782 (Delozier-R-Cumberland) authorizing alternative ratemaking by the Public Utility Commission for utilities it regulates, including electric, natural gas, water and wastewater services.

In the energy context, the bill is designed to allow utilities to encourage energy efficiency improvements, distributed and renewable energy projects.

The bill would allow the Public Utility Commission to approve the use of alternate ratemaking mechanisms by utilities, such as decoupling, performance-based rates, formula rates and multiyear rates.

It does not add to the amount a company is approved to earn or recover from ratepayers. This continues to be determined by the PUC. It also does not change the type of costs that may be recovered by a utility through rates.

The bill clarifies the PUC’s authority to approve the use of alternative rate mechanism. These mechanism could be used to recover capital costs and expenses to provide service as they do now, and the PUC retains the ability to approve such recovery.

House Bill 1782 now goes to the full Senate for consideration.  (House Fiscal Note and summary)

Sen. Tommy Tomlinson (R-Bucks) serves as Majority Chair of the Consumer Protection Committee and can be contacted by calling 717-787-5072 or sending email to: rtomlinson@pasen.gov.  Sen. Lisa Boscola (D-Lehigh) serves as Minority Chair and can be contacted by calling 717-787-4236 or sending email to: boscola@pasenate.com.