LRB-2722/1
MDK:jld:rs
2007 - 2008 LEGISLATURE
February 4, 2008 - Introduced by Senators Cowles, A. Lasee and Lassa,
cosponsored by Representatives
A. Ott, Hahn, Bies, Albers and Soletski.
Referred to Committee on Commerce, Utilities and Rail.
SB448,1,3
1An Act to repeal 196.027 (3) (b);
to renumber and amend 196.027 (3) (a);
to
2repeal and recreate 196.027 (2) (a) (title); and
to create 196.027 (2) (am) of
3the statutes;
relating to: environmental trust bonds issued by energy utilities.
Analysis by the Legislative Reference Bureau
Under current law, an energy utility is allowed to apply to the Public Service
Commission (PSC) for an order allowing the utility to finance the costs of the
following activities by issuing bonds: 1) the construction, installation, or otherwise
putting into place of environmental control equipment in connection with a plant
that, before March 30, 2004, has been used to provide service to customers; and 2)
the retiring of any existing plant, facility, or other property to reduce, control, or
eliminate environmental pollution in accordance with federal or state law. Current
law defines the foregoing activities as "environmental control activities." If approved
by the PSC, the bonds, which are referred to as "environmental trust bonds," are
secured by revenues arising from charges paid by an energy utility's customers for
the utility to recover the cost of the activities, as well as the cost of financing the
bonds.
As noted above, current law allows an energy utility to apply for an order
approving environmental trust bonds. If an energy utility has not applied for such
an order, current law prohibits the PSC from requiring that an energy utility use
environmental trust bonds as a financing mechanism.
This bill allows the PSC to order an energy utility to apply for an order
approving environmental trust bonds. If the PSC orders an energy utility to make
such an application, the PSC's order must specify the environmental control
activities and related costs that must be described and estimated in the application.
The PSC's order must also specify whether the energy utility must propose to finance
all or a portion of the costs with environmental trust bonds. The bill does not
otherwise change the requirements under current law that apply to the PSC's
consideration of an application.
The people of the state of Wisconsin, represented in senate and assembly, do
enact as follows:
SB448, s. 1
1Section
1. 196.027 (2) (a) (title) of the statutes is repealed and recreated to
2read:
SB448,2,33
196.027
(2) (a) (title)
Permissive applications.
SB448, s. 2
4Section
2. 196.027 (2) (am) of the statutes is created to read:
SB448,2,105
196.027
(2) (am)
Mandatory applications. The commission may order an
6energy utility to apply for a financing order under par. (a). The commission shall
7specify in an order under this paragraph the environmental control activities that
8must be described, and the environmental control costs that must be estimated, in
9the application, and shall specify whether the energy utility must propose in the
10application to finance all or a portion of the costs with environmental trust bonds.
SB448, s. 3
11Section
3. 196.027 (3) (a) of the statutes is renumbered 196.027 (3) and
12amended to read:
SB448,3,413
196.027
(3) Exceptions to commission jurisdiction. If the commission issues
14a financing order to an energy utility, the commission may not, in exercising its
15powers and carrying out its duties regarding rate making, consider the
16environmental trust bonds issued pursuant to the order to be the debt of the energy
17utility, the environmental control charges paid under the order to be the revenue of
18the energy utility, or the environmental control costs or financing costs specified in
19the order to be the costs of the energy utility, nor may the commission determine that
1any action taken by an energy utility that is consistent with the order is unjust or
2unreasonable. Nothing in this
paragraph subsection affects the authority of the
3commission to adjust or reduce an energy utility's revenue requirements under sub.
4(4) (a).
SB448, s. 4
5Section
4. 196.027 (3) (b) of the statutes is repealed.
