Press Release

PUC Commissioners Direct Implementation of House Bill 2200

Published on 10/9/2008

Filed under: Electric

HARRISBURG – The Pennsylvania Public Utility Commission (PUC) today unanimously approved a Motion to begin implementation of House Bill 2200, which expands the PUC’s oversight responsibilities and imposes new requirements on the Electric Distribution Companies (EDCs), with the overall goal of enhancing procurement; reducing energy demand and consumption; and expanding alternative energy sources.

 “Yesterday, both the Senate and the House overwhelmingly passed House Bill 2200, which now is on the Governor’s desk for signature,” said the Joint Motion offered by Commissioners Kim Pizzingrilli and Robert F. Powelson.  “As with the passage of any significant piece of legislation, the Commission will convene an internal working group to develop an implementation plan to ensure that guidance is provided to EDCs and that consumers realize the benefits of energy efficiency and conservation measures.  The Commission recognizes the importance of implementing this law in a prompt manner, and will move forward with all deliberate speed, while allowing for stakeholder participation and input.”

Under the Commissioners’ Motion, as soon as the Governor signs House Bill 2200 into law, the PUC Director of Operations will convene a working group to develop an implementation plan.

In a Statement, PUC Chairman James H. Cawley said, “Thanks to the Governor and the legislature, demand-side resources will now be a true part of Pennsylvania’s energy future.  This Commission has a lot of work to do.  The legislation gives the Commission nine-and-a-half weeks to adopt provisions to shape an energy efficiency and conservation program for the Commonwealth.  Fortunately, the Commission has already scheduled an en banc hearing for Thursday, Nov. 13, 2008, on energy conservation and related issues.  Yesterday’s passage of HB 2200 necessarily and dramatically changes the focus of that hearing.  My colleagues and I will now consider whether to issue a new set of questions for the hearing focusing on specific issues in the new legislation, including required contents of the utility plans, the review process, the evaluation requirements, the cost benefit analysis, the Commission’s forecast of utility retail sales for June 1, 2009, through May 31, 2010, the cost recovery mechanism, the registry of conservation service providers, and other provisions in the new law.”

On Oct. 3, the PUC released a secretarial letter with information about its special public hearing on Thursday, Nov. 13, on alternative energy resources, energy conservation and efficiency, and demand side response (DSR) tools and programs to assist consumers.  Further details and developments will be released as they are available.

Highlights of House Bill 2200 include the following:

• Directs the PUC to adopt an energy efficiency and conservation program to require EDCs to submit and implement plans to reduce energy demand and consumption within each service territory.  Effective energy efficiency and demand response may reduce magnitude of needed, but costly, investments in new electric generation and transmission infrastructure.
• Requires the EDC to file a plan for smart meter procurement and installation; requires the installation of smart meters in new building construction and upon customer request if the customer agrees to pay the cost of the meter; and in accordance with a depreciation schedule.  It also requires EDCs to submit time-of-use rates and real-time price plans which may be offered to those customers with smart meters.  Smart meters and time-based rates are essential components of any plan to reduce peak demand.
• Confirms that EDCs must obtain energy through a prudent mix of contracts, with an emphasis on competitive procurements to ensure adequate and reliable electricity is supplied at the least cost to customers.
• Encourages energy independence by providing greater incentives for the development of Pennsylvania biomass energy resources and regional hydropower resources.
• Imposes an affirmative obligation on EDCs to seek monetary damages from energy suppliers for market misconduct, and to refund any monies recovered to ratepayers.

The Pennsylvania Public Utility Commission balances the needs of consumers and utilities to ensure safe and reliable utility service at reasonable rates; protect the public interest; educate consumers to make independent and informed utility choices; further economic development; and foster new technologies and competitive markets in an environmentally sound manner.

For recent news releases, audio of select Commission proceedings or more information about the PUC, visit our Web site at www.puc.state.pa.us.

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Docket No. M-2008-2068297

Contact:

• Denise McCracken
  Senior Communications Specialist
  717-787-5722
  demccracken@pa.gov