75th OREGON LEGISLATIVE ASSEMBLY--2009 Regular Session
Enrolled
Senate Bill 76
Printed pursuant to Senate Interim Rule 213.28 by order of the
President of the Senate in conformance with presession filing
rules, indicating neither advocacy nor opposition on the part
of the President (at the request of Governor Theodore R.
Kulongoski)
CHAPTER ................
AN ACT
Relating to Klamath River dams; and declaring an emergency.
Whereas the Klamath Agreement in Principle was signed November
13, 2008, by the states of Oregon and California, by the United
States Department of the Interior and by PacifiCorp, and it is
anticipated that a final agreement will be entered into by these
and other parties; and
Whereas the Klamath Agreement in Principle states that it is
the preliminary view of this state and the United States
Department of the Interior that the potential benefits of the
removal of dams on the Klamath River for fisheries, water and
other resources outweigh the potential costs of that removal; and
Whereas it is anticipated that, subject to final analysis and
confirmation by the Secretary of the Interior and review by the
states of Oregon and California, the Klamath Agreement in
Principle and the final agreement will together set forth a
framework for action based on the preliminary view that removal
of dams on the Klamath River is in the public interest; and
Whereas to facilitate the removal of the Klamath River dams,
the Public Utility Commission must set rates that allow
PacifiCorp to recover Oregon's fair share of PacifiCorp's
undepreciated investment in the dams, to recover the funds
necessary to pay additional costs that PacifiCorp may incur from
changes in operation of the dams prior to removal and to pay for
replacement resources following removal; and
Whereas to facilitate removal of the dams, the Public Utility
Commission must establish a surcharge to provide funds necessary
to cover costs associated with removal of the dams; and
Whereas the public interest requires that the Public Utility
Commission hold a hearing to determine whether the imposition of
surcharges under the terms of the final agreement results in
rates that are fair, just and reasonable; now, therefore,
Be It Enacted by the People of the State of Oregon:
SECTION 1. { + Sections 2 to 8 of this 2009 Act are added to
and made a part of ORS chapter 757. + }
SECTION 2. { + Definitions. As used in sections 2 to 8 of this
2009 Act:
Enrolled Senate Bill 76 (SB 76-B) Page 1
(1) 'Agreement in principle' means the agreement signed
November 13, 2008, by the states of Oregon and California, by the
United States Department of the Interior and by PacifiCorp.
(2) 'Allocated share' means the portion of PacifiCorp's costs
assigned to this state under the interjurisdictional cost
allocation methodology used by the Public Utility Commission for
the purpose of establishing rates for PacifiCorp.
(3) 'Customers' means the Oregon retail electricity customers
of PacifiCorp.
(4) 'Final agreement' means a successor agreement to the
agreement in principle.
(5) 'Klamath River dam' means the J.C. Boyle Dam located in
Oregon, the Copco 1 Dam located in California, the Copco 2 Dam
located in California or the Iron Gate Dam located in
California. + }
SECTION 3. { + Recovery of investment in Klamath River dams.
(1) Not more than six months after the execution of a final
agreement, the Public Utility Commission shall determine a
depreciation schedule under ORS 757.140 for each Klamath River
dam based on the assumption that the dam will be removed in 2020.
The commission may change a depreciation schedule determined
under this section at any time if removal of a dam will occur
during a year other than 2020.
(2) The commission shall use the depreciation schedules
prepared under this section to establish rates and tariffs for
the recovery of Oregon's allocated share of undepreciated amounts
prudently invested by PacifiCorp in a Klamath River dam. Amounts
recoverable under this section include, but are not limited to:
(a) Return of investment and return on investment;
(b) Capital improvements required by the United States or any
state for continued operation of the dam until dam removal;
(c) Amounts spent by PacifiCorp in seeking relicensing of the
dam before the effective date of this 2009 Act;
(d) Amounts spent by PacifiCorp for settlement of the issues of
relicensing or removal of the dam; and
(e) Amounts spent by PacifiCorp for the decommissioning of the
dam in anticipation of the dam's removal.
(3) If any amount specified under subsection (2) of this
section has not been recovered by PacifiCorp before a dam is
removed, the Public Utility Commission shall allow recovery of
that amount by PacifiCorp in PacifiCorp's rates and tariffs. The
commission shall allow the recovery without an amortization
schedule if the impact of the recovery does not exceed one-half
of one percent of PacifiCorp's annual revenue requirement. If the
impact exceeds one-half of one percent of PacifiCorp's annual
revenue requirement, the commission may establish an amortization
schedule that limits the annual impact to one-half of one percent
of PacifiCorp's annual revenue requirement. + }
SECTION 4. { + Surcharges for funding costs of removing
Klamath River dams. (1) Not more than 30 days after the execution
of a final agreement, PacifiCorp must file a copy of the final
agreement with the Public Utility Commission along with full and
complete copies of all analyses or studies that relate to the
rate-related costs, benefits and risks for customers of removing
or relicensing Klamath River dams and that were reviewed by
PacifiCorp during the decision-making process that led to
PacifiCorp's entering into the final agreement.
(2) PacifiCorp must include with the filing made under
subsection (1) of this section tariffs for the collection of two
nonbypassable surcharges from its customers for the purpose of
Enrolled Senate Bill 76 (SB 76-B) Page 2
paying the costs of removing Klamath River dams as described in
subsection (11) of this section. Notwithstanding the commission's
findings and conclusions under subsection (4) of this section,
the commission shall require PacifiCorp to begin collecting the
surcharges on the date that the filing is made under subsection
(1) of this section, or on January 1, 2010, whichever is later,
and PacifiCorp shall continue to collect the surcharges pending a
final decision on the commission's order under subsection (4) of
this section. The surcharges imposed under this section shall be:
(a) A surcharge for the costs of removing the J.C. Boyle Dam;
and
(b) A surcharge for the costs of removing the Copco 1 Dam, the
Copco 2 Dam and the Iron Gate Dam.
(3) The surcharges imposed under this section may not exceed
the amounts necessary to fund Oregon's share of the customer
contribution of $200 million identified in the agreement in
principle. In addition, the total amount collected in a calendar
year under both surcharges may not exceed more than two percent
of PacifiCorp's annual revenue requirement as determined in
PacifiCorp's last case under ORS 757.210 decided by the
commission before January 1, 2010.
(4) Not more than six months after a filing is made under
subsection (1) of this section, the commission shall conduct a
hearing under ORS 757.210 on the surcharges imposed under this
section, and shall enter an order setting forth findings and
conclusions as to whether the imposition of surcharges under the
terms of the final agreement results in rates that are fair, just
and reasonable.
(5) Notwithstanding ORS 183.482 (1), jurisdiction for judicial
review of any appeal of an order entered under subsection (4) of
this section is conferred on the Supreme Court, and a person
seeking judicial review of the order must file a petition for
review with the Supreme Court in the manner provided by ORS
183.482. ORS 183.482 (3) does not apply to an order entered under
subsection (4) of this section. If a petition for review is
filed, the surcharges imposed under the terms of the final
agreement shall remain in effect pending a final decision on the
petition, but shall be refunded if the rates resulting from the
surcharges are finally determined not to be fair, just and
reasonable. A petition filed under this subsection must indicate
on its face that the petition is filed pursuant to this
subsection.
(6) The commission may not use any commercially sensitive
information provided to the commission in a filing made under
subsection (1) of this section for any purpose other than
determining whether the imposition of surcharges under the terms
of the final agreement results in rates that are fair, just and
reasonable. Notwithstanding ORS 192.410 to 192.505, the
commission may not release commercially sensitive information
provided to the commission under this section, and shall require
any person participating in a proceeding relating to the
surcharge to sign a protective order prepared by the commission
before allowing the participant to obtain and use the
information.
(7) The surcharges imposed under this section must be of a
specified amount per kilowatt hour billed to retail customers, as
determined by the commission. The amount of each surcharge shall
be calculated based on a collection schedule that will fund, by
December 31, 2019, Oregon's share of the customer contribution of
$200 million identified in the agreement in principle. To the
Enrolled Senate Bill 76 (SB 76-B) Page 3
extent practicable, the commission shall set the surcharges so
that total annual collections of the surcharges remain
approximately the same during the collection period. The
commission may change the collection schedule if a Klamath River
dam will be removed during a year other than 2020.
(8) Except as provided in section 5 (2) of this 2009 Act, all
amounts collected under the surcharges imposed under this section
shall be paid into the appropriate trust account established
under section 5 of this 2009 Act.
(9) If the commission determines at any time that amounts have
been collected under this section in excess of those needed, or
in excess of those allowed, the commission must:
(a) Direct the trustee of the appropriate trust account under
section 5 of this 2009 Act to refund these excess amounts to
customers or to otherwise use these amounts for the benefit of
customers; or
(b) Adjust future surcharge amounts as necessary to offset the
excess amounts.
(10) If one or more Klamath River dams will not be removed, the
commission shall direct PacifiCorp to terminate collection of all
or part of the surcharges imposed under this section. In
addition, the commission shall direct the trustee of the
appropriate trust account under section 5 of this 2009 Act to
apply any excess balances in the accounts to Oregon's allocated
share of prudently incurred costs to implement Federal Energy
Regulatory Commission relicensing requirements. If any excess
amounts remain in the trust accounts after that application, the
Public Utility Commission shall order that the excess amounts be
refunded to customers or otherwise be used for the benefit of
customers in accordance with Public Utility Commission rules and
policies.
(11) For the purposes of subsection (2) of this section, ' the
costs of removing Klamath River dams' includes costs of:
(a) Physical removal of the dams;
(b) Site remediation and restoration;
(c) Avoiding downstream impacts of dam removal;
(d) Downstream impacts of dam removal;
(e) Permits that are required for the removal;
(f) Removal and disposal of sediment, debris and other
materials, if necessary; and
(g) Compliance with environmental laws. + }
SECTION 5. { + Surcharge trust accounts. (1) The Public
Utility Commission shall establish a separate trust account for
amounts generated by each of the two surcharges imposed under
section 4 of this 2009 Act. The commission shall establish the
trust accounts as interest-bearing accounts with an agency of the
United States identified in the final agreement, or in a
depository that is qualified under ORS 295.001 to 295.108 to
receive public funds. The commission may authorize transfer of
funds from one trust account to another as necessary to fund
removal of the Klamath River dams.
(2) If an agreement is entered into under section 7 (2) of this
2009 Act, the parties to the agreement may agree that a portion
of the amounts collected under one surcharge may be deposited in
the trust account established for amounts collected under the
other surcharge.
(3) Upon request of an agency of the United States, or upon
request of the designee of an agency of the United States, the
commission shall require the trustee of the appropriate trust
account established under this section to transfer to the agency
Enrolled Senate Bill 76 (SB 76-B) Page 4
or designee the amounts that are necessary to pay the costs of
removing the Klamath River dams as described in section 4 (11) of
this 2009 Act.
(4) If any amounts remain in a trust account established under
this section after the trustee makes all payments necessary for
the costs of removing the Klamath River dams as described in
section 4 (11) of this 2009 Act, the commission shall direct the
trustee of the account to refund those amounts to customers or to
otherwise use the excess amounts for the benefit of
customers. + }
SECTION 6. { + Recovery of other costs incurred by PacifiCorp.
Pursuant to ORS 757.210, the Public Utility Commission shall
allow PacifiCorp to include in its rates and tariffs this state's
allocated share of any costs that are prudently incurred by
PacifiCorp from changes in operation of Klamath River dams before
removal of the dams, or that are prudently incurred for
replacement power after the dams are removed, that are not
otherwise recovered under sections 3 and 4 of this 2009 Act. + }
SECTION 7. { + Agreement to apportion costs and to establish
and administer trust fund. (1) The State of Oregon may enter into
an agreement with representatives of the State of California,
either as part of a final agreement or by separate agreement,
that establishes each state's share of the customer contribution
of $200 million identified in the agreement in principle.
(2) The Public Utility Commission may enter into an agreement
with representatives of the State of California to establish and
administer the trust accounts authorized under section 5 of this
2009 Act and to ensure that trust account moneys are disbursed
for dam removal costs that are necessary and appropriate. + }
SECTION 8. { + Disclaimers. (1) Sections 2 to 8 of this 2009
Act do not authorize the expenditure of any public moneys for
removal of Klamath River dams.
(2) Sections 2 to 8 of this 2009 Act do not create a cause of
action against the State of Oregon or against any of the
officers, employees or agents of the state and may not be used as
the basis for an assertion of liability on the part of the State
of Oregon or of any officers, employees or agents of the
state. + }
SECTION 9. { + The section captions used in this 2009 Act are
provided only for the convenience of the reader and do not become
part of the statutory law of this state or express any
legislative intent in the enactment of this 2009 Act. + }
SECTION 10. { + This 2009 Act being necessary for the
immediate preservation of the public peace, health and safety, an
emergency is declared to exist, and this 2009 Act takes effect on
its passage. + }
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Enrolled Senate Bill 76 (SB 76-B) Page 5
Passed by Senate February 17, 2009
Repassed by Senate June 22, 2009
...........................................................
Secretary of Senate
...........................................................
President of Senate
Passed by House June 12, 2009
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Speaker of House
Enrolled Senate Bill 76 (SB 76-B) Page 6
Received by Governor:
......M.,............., 2009
Approved:
......M.,............., 2009
...........................................................
Governor
Filed in Office of Secretary of State:
......M.,............., 2009
...........................................................
Secretary of State
Enrolled Senate Bill 76 (SB 76-B) Page 7