Pennsylvania HB 1272: An Act amending Title 66 (Public Utilities) of the Pennsylvania Consolidated Statutes, in restructuring of electric utility industry, further providing for definitions and for duties of electric distribution companies.

Bill Text

PRINTER'S NO. 1425
THE GENERAL ASSEMBLY OF PENNSYLVANIA
HOUSE BILL
No. 1272
Session of
2025
INTRODUCED BY STAMBAUGH, BERNSTINE, M. MACKENZIE, M. JONES,
ROWE, COOK, GREINER, GILLEN, HAMM, RADER, WATRO, ZIMMERMAN,
KAUFFMAN, GAYDOS, KUTZ AND RYNCAVAGE, APRIL 21, 2025
REFERRED TO COMMITTEE ON ENERGY, APRIL 21, 2025
AN ACT
Amending Title 66 (Public Utilities) of the Pennsylvania
Consolidated Statutes, in restructuring of electric utility
industry, further providing for definitions and for duties of
electric distribution companies.
The General Assembly of the Commonwealth of Pennsylvania
hereby enacts as follows:
Section 1. Section 2803 of Title 66 of the Pennsylvania
Consolidated Statutes is amended by adding definitions to read:
§ 2803. Definitions.
The following words and phrases when used in this chapter
shall have the meanings given to them in this section unless the
context clearly indicates otherwise:
* * *
"Long-term resource adequacy agreement." An agreement
between an electric distribution company and another person or
corporation in which the electric distribution company invests
in a new generation resource in exchange for a portion of the
net revenues derived from the new generation resource, with the
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portion of the net revenues being credited to customers through
a nonbypassable surcharge mechanism established in accordance
with section 2807(e)(5.1)(i)(G) (relating to duties of electric
distribution companies).
"New generation resource." An electric generation facility
that provides electric generation supply to the bulk electric
system and that is newly constructed in the electric
distribution company's transmission control zone or service
territory, including, but not limited to, one or more of the
following resources:
(1) Natural gas.
(2) Nuclear energy.
(3) Battery storage.
(4) Alternative energy sources, as the term is defined
by section 2 of the act of November 30, 2004 (P.L.1672,
No.213), known as the Alternative Energy Portfolio Standards
Act.
* * *
"Resource adequacy." When the projection for all available
sources of electric supply, as submitted under section 524(a)(2)
(relating to data to be supplied by electric utilities), exceeds
the projection of electrical energy use and electrical demand by
a reasonable reserve margin.
"Resource inadequacy." When the projection of available
sources of electric supply as calculated for resource adequacy,
including capacity and generation availability during times of
demand, falls below a reasonable reserve margin.
* * *
Section 2. Section 2807(e)(3.2), (3.3), (3.4) and (3.7) of
Title 66 are amended and the subsection is amended by adding a
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paragraph to read:
§ 2807. Duties of electric distribution companies.
* * *
(e) Obligation to serve.--A default service provider's
obligation to provide electric generation supply service
following the expiration of a generation rate cap specified
under section 2804(4) (relating to standards for restructuring
of electric industry) or a restructuring plan under section
2806(f) is revised as follows:
* * *
(3.2) The electric power procured pursuant to paragraph
(3.1) shall include [a prudent mix] one or more of the
following:
(i) Spot market purchases.
(ii) Short-term contracts.
(iii) Long-term purchase contracts, entered into as
a result of an auction, request for proposal or bilateral
contract that is free of undue influence, duress or
favoritism, of more than four and not more than [20] 30
years. The default service provider shall have sole
discretion to determine the source and fuel type. Long-
term purchase contracts under this subparagraph may [not
constitute more than 25% of the] be used to procure up to
the full amount of the default service provider's
projected default service load [unless the commission,
after a hearing, determines for good cause that a greater
portion of load is necessary to achieve least cost
procurement]. This subparagraph shall not apply to
contracts executed under paragraph (5).
[(3.3) The commission may determine that a contract is
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required to be extended for a longer term of up to 20 years,
if the extension is necessary to ensure adequate and reliable
service at least cost to customers over time.]
(3.4) [The prudent mix of contracts] A contract entered
into pursuant to [paragraphs (3.2) and (3.3)] paragraph (3.2)
shall be designed to ensure:
(i) Adequate and reliable service at a reasonable
cost to consumers.
[(ii) The least cost to customers over time.]
(iii) Compliance with the requirements of paragraph
(3.1).
* * *
(3.7) At the time the commission evaluates the plan and
prior to approval, in determining if the default electric
service provider's plan obtains generation supply at [the
least] a reasonable cost, the commission shal