00 CS FOR SENATE BILL NO. 185(FIN) am 01 "An Act relating to the basis for determining eligibility for and the amount of power 02 cost equalization payments; and providing for an effective date." 03 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 04  * Section 1. AS 42.45.100(a) is amended to read: 05 (a) The power cost equalization and rural electric capitalization fund is 06 established as a separate fund for the purpose of 07 (1) equalizing power cost per kilowatt-hour statewide at a cost close to 08 [OR EQUAL TO] the mean of the cost per kilowatt-hour in Anchorage, Fairbanks, 09 and Juneau by paying money from the fund to eligible electric utilities in the state; and 10 (2) making grants to eligible utilities under AS 42.45.180 to improve 11 the performance of the utility. 12  * Sec. 2. AS 42.45.100(a) is amended to read: 13 (a) The power cost equalization and rural electric capitalization fund is 14 established as a separate fund for the purpose of 01 (1) equalizing power cost per kilowatt-hour statewide at a cost close to 02 or equal to the mean of the cost per kilowatt-hour in Anchorage, Fairbanks, and 03 Juneau by paying money from the fund to eligible electric utilities in the state; and 04 (2) making grants to eligible utilities under AS 42.45.180 to improve 05 the performance of the utility. 06  * Sec. 3. AS 42.45.110(b) is amended to read: 07 (b) An eligible electric utility is entitled to receive power cost equalization 08 (1) for sales of power to local community facilities, calculated in the 09 aggregate for each community served by the electric utility, for actual consumption of 10 not more than 70 kilowatt-hours per month for each resident of the community; the 11 number of community residents shall be determined under AS 29.60.020; and 12 (2) for actual consumption [OF NOT MORE THAN 500 13 KILOWATT-HOURS PER MONTH] sold to each residential customer of not more  14 than  15 (A) 450 kilowatt-hours per month for the months of  16 October through March; and  17 (B) 350 kilowatt-hours per month for the months of April  18 through September. 19  * Sec. 4. AS 42.45.110(b) is amended to read: 20 (b) An eligible electric utility is entitled to receive power cost equalization 21 (1) for sales of power to local community facilities, calculated in the 22 aggregate for each community served by the electric utility, for actual consumption of 23 not more than 70 kilowatt-hours per month for each resident of the community; the 24 number of community residents shall be determined under AS 29.60.020; and 25 (2) for actual consumption of not more than 500 kilowatt-hours per  26 month sold to each residential customer [OF NOT MORE THAN 27 (A) 450 KILOWATT-HOURS PER MONTH FOR THE 28 MONTHS OF OCTOBER THROUGH MARCH; AND 29 (B) 350 KILOWATT-HOURS PER MONTH FOR THE 30 MONTHS OF APRIL THROUGH SEPTEMBER]. 31  * Sec. 5. AS 42.45.110(c) is amended to read: 01 (c) The amount of power cost equalization provided per kilowatt-hour under 02 [SUBSECTION] (b) of this section may not exceed 95 percent of the power costs, or 03 the average rate per eligible kilowatt-hour sold, whichever is less, as determined by 04 the commission. However, 05 (1) during the state fiscal year that began July 1, 1999, the power costs 06 for which power cost equalization were paid to an electric utility were limited to 07 minimum power costs of more than 12 cents per kilowatt-hour and less than 52.5 cents 08 per kilowatt-hour; 09 (2) during the state fiscal years beginning July 1, 2000, and July 1,  10 2001 [EACH FOLLOWING STATE FISCAL YEAR], the commission shall adjust 11 the power costs for which power cost equalization may be paid to an electric utility 12 based on the weighted average retail residential rate in Anchorage, Fairbanks, and 13 Juneau; however, the commission may not adjust the power costs under this paragraph 14 to reduce the amount below the lower limit set out in (1) of this subsection; [AND] 15 (3) during each following state fiscal year, the commission shall  16 adjust the power costs for which power cost equalization may be paid to an  17 electric utility based on the weighted average retail residential rate in Anchorage,  18 Fairbanks, and Juneau, per kilowatt-hour for sales to residential customers of  19 400 kilowatt-hours per month; the commission may not adjust the power costs  20 under this paragraph to reduce the amount below 16.75 cents per kilowatt-hour,  21 and may not apply an adjustment determined under this paragraph if the  22 adjustment reduces the power cost equalization payment to an electric utility by  23 more than 25 percent below the amount paid the previous fiscal year; if, in  24 making the adjustments authorized by this paragraph, application of the  25 adjustments would cause the reduction to any electric utility to exceed that 25  26 percent, the commission shall  27 (A) reduce the payment due each electric utility to an  28 amount that is 25 percent below the amount paid to that utility the  29 previous fiscal year; and  30 (B) thereafter reduce pro rata the amount paid to each  31 electric utility to comply with the power cost adjustment formula set out  01 in this paragraph; and 02 (4) the power cost equalization per kilowatt-hour may be determined 03 for a utility without historical kilowatt-hour sales data by using kilowatt-hours 04 generated. 05  * Sec. 6. AS 42.45.110(c) is amended to read: 06 (c) The amount of power cost equalization provided per kilowatt-hour under 07 (b) of this section may not exceed 95 percent of the power costs, or the average rate 08 per eligible kilowatt-hour sold, whichever is less, as determined by the commission. 09 However, 10 (1) during the state fiscal year that began July 1, 1999, the power costs 11 for which power cost equalization were paid to an electric utility were limited to 12 minimum power costs of more than 12 cents per kilowatt-hour and less than 52.5 cents 13 per kilowatt-hour; 14 (2) during the state fiscal year [YEARS] beginning July 1, 2007, and  15 each following state fiscal year [JULY 1, 2000, AND JULY 1, 2001], the 16 commission shall adjust the power costs for which power cost equalization may be 17 paid to an electric utility based on the weighted average retail residential rate in 18 Anchorage, Fairbanks, and Juneau; however, the commission may not adjust the 19 power costs under this paragraph to reduce the amount below the lower limit set out in 20 (1) of this subsection; and 21 (3) [DURING EACH FOLLOWING STATE FISCAL YEAR, THE 22 COMMISSION SHALL ADJUST THE POWER COSTS FOR WHICH POWER 23 COST EQUALIZATION MAY BE PAID TO AN ELECTRIC UTILITY BASED ON 24 THE WEIGHTED AVERAGE RETAIL RESIDENTIAL RATE IN ANCHORAGE, 25 FAIRBANKS, AND JUNEAU, PER KILOWATT-HOUR FOR SALES TO 26 RESIDENTIAL CUSTOMERS OF 400 KILOWATT-HOURS PER MONTH; THE 27 COMMISSION MAY NOT ADJUST THE POWER COSTS UNDER THIS 28 PARAGRAPH TO REDUCE THE AMOUNT BELOW 16.75 CENTS PER 29 KILOWATT-HOUR, AND MAY NOT APPLY AN ADJUSTMENT DETERMINED 30 UNDER THIS PARAGRAPH IF THE ADJUSTMENT REDUCES THE POWER 31 COST EQUALIZATION PAYMENT TO AN ELECTRIC UTILITY BY MORE 01 THAN 25 PERCENT BELOW THE AMOUNT PAID THE PREVIOUS YEAR; IF, 02 IN MAKING THE ADJUSTMENTS AUTHORIZED BY THIS PARAGRAPH, 03 APPLICATION OF THE ADJUSTMENTS WOULD CAUSE THE REDUCTION 04 TO ANY ELECTRIC UTILITY TO EXCEED THAT 25 PERCENT, THE 05 COMMISSION SHALL 06 (A) REDUCE THE PAYMENT DUE EACH ELECTRIC 07 UTILITY TO AN AMOUNT THAT IS 25 PERCENT BELOW THE 08 AMOUNT PAID TO THAT UTILITY THE PREVIOUS FISCAL YEAR; 09 AND 10 (B) THEREAFTER REDUCE PRO RATA THE AMOUNT 11 PAID TO EACH ELECTRIC UTILITY TO COMPLY WITH THE POWER 12 COST ADJUSTMENT FORMULA SET OUT IN THIS PARAGRAPH; AND 13 (4)] the power cost equalization per kilowatt-hour may be determined 14 for a utility without historical kilowatt-hour sales data by using kilowatt-hours 15 generated. 16  * Sec. 7. AS 42.45.110(d) is amended to read: 17 (d) An electric utility whose customers receive power cost equalization under 18 AS 42.45.100 - 42.45.150 shall set out in its tariff the rates without the power cost 19 equalization and the amount of power cost equalization per kilowatt-hour sold. The 20 rate charged to the customer shall be the difference between the two amounts. Power 21 cost equalization paid under AS 42.45.100 - 42.45.150 shall be used to reduce the cost 22 of all power sold to local community facilities, in the aggregate, to the extent of 70 23 kilowatt-hours per month per resident of the community, and to reduce the cost to  24 each residential customer of not more than 450 [THE FIRST 500] kilowatt-hours 25 per residential customer per month for the months of October through March, and  26 not more than 350 kilowatt-hours per month for the months of April through  27 September. 28  * Sec. 8. AS 42.45.110(d) is amended to read: 29 (d) An electric utility whose customers receive power cost equalization under 30 AS 42.45.100 - 42.45.150 shall set out in its tariff the rates without the power cost 31 equalization and the amount of power cost equalization per kilowatt-hour sold. The 01 rate charged to the customer shall be the difference between the two amounts. Power 02 cost equalization paid under AS 42.45.100 - 42.45.150 shall be used to reduce the cost 03 of all power sold to local community facilities, in the aggregate, to the extent of 70 04 kilowatt-hours per month per resident of the community, and to reduce the cost [TO 05 EACH RESIDENTIAL CUSTOMER] of the first 500 [NOT MORE THAN 450] 06 kilowatt-hours per residential customer per month [FOR THE MONTHS OF 07 OCTOBER THROUGH MARCH, AND NOT MORE THAN 350 KILOWATT- 08 HOURS PER MONTH FOR THE MONTHS OF APRIL THROUGH SEPTEMBER]. 09  * Sec. 9. The uncodified law of the State of Alaska is amended by adding a new section to 10 read: 11 POWER COST EQUALIZATION PROGRAM ADJUSTMENTS. It is the intent of 12 the legislature that if the amount available for power cost equalization under 13 AS 42.45.085(a)(1) exceeds the costs of the program, the legislature will 14 (1) review the statutory provisions and consider increasing the maximum 15 number of kilowatt hours eligible for power cost equalization and adjusting the minimum and 16 maximum power costs for which power cost equalization may be paid; and 17 (2) consider other changes to provisions of the program in order to further 18 lower the cost of electricity to rural consumers. 19  * Sec. 10. Sections 1, 3, 5, 7, and 9 of this Act take effect July 1, 2002. 20  * Sec. 11. Sections 2, 4, 6, and 8 of this Act take effect July 1, 2007.