75th OREGON LEGISLATIVE ASSEMBLY--2009 Regular Session
NOTE: Matter within { + braces and plus signs + } in an
amended section is new. Matter within { - braces and minus
signs - } is existing law to be omitted. New sections are within
{ + braces and plus signs + } .
LC 946
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)
SUMMARY
The following summary is not prepared by the sponsors of the
measure and is not a part of the body thereof subject to
consideration by the Legislative Assembly. It is an editor's
brief statement of the essential features of the measure as
introduced.
Directs Public Utility Commission to determine depreciation
schedules for Klamath River dams based on assumption that dams
will be removed in 2020. Requires affected public utilities to
use depreciation schedules to establish rates and tariffs for
recovery of undepreciated amounts prudently invested by public
utility in Klamath River dams.
Directs Public Utility Commission to require affected public
utility to collect surcharges from customers for purpose of
recovering costs incurred by public utility for removal of
Klamath River dams. Imposes limit on amounts collected as
surcharges. Provides that if commission determines that Klamath
River dam will not be removed, commission may terminate
collection of all or part of surcharges and direct refund of
amounts collected or use of amounts collected for benefit of
customers.
Directs Public Utility Commission to allow affected public
utility to include in rates and tariffs costs that are prudently
incurred by utility by reason of changes in operation of Klamath
River dams before removal of dams, or for replacement power after
dams are removed.
Declares emergency, effective on passage.
A BILL FOR AN ACT
Relating to Klamath River dams; and declaring an emergency.
Whereas the removal of dams on the Klamath River is necessary
to restore, increase and maintain fish population in the river;
and
Whereas to facilitate removal, the Public Utility Commission
must set rates that allow a public utility that uses the dams to
serve its Oregon customers by recovering Oregon's fair share of
the amounts that represent the utility's undepreciated investment
in the dams, recovering the funds necessary to cover the costs
for removal of the dams and recovering the funds necessary to pay
additional costs that the utility may incur from changes in
operation of the dams prior to, and replacement resources
following, removal; and
Whereas to facilitate removal, the Public Utility Commission
must establish a surcharge to provide funds necessary to cover
costs associated with removal of the dams; 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:
(1) 'Affected public utility' means a public utility that
generates electricity using a Klamath River dam for the purpose
of serving the customers of the public utility.
(2) 'Customers' means the Oregon retail electricity customers
of an affected public utility.
(3) 'Klamath River dam' means the J.C. Boyle Dam, located in
Oregon, or the Copco 1 Dam, the Copco 2 Dam or the Iron Gate Dam,
located in California. + }
SECTION 3. { + Recovery of investment in Klamath River
dams. + } { + (1) The Public Utility Commission shall determine
a depreciation schedule for each Klamath River dam based on the
assumption that the dam will be removed in 2020. The commission
may change a depreciation schedule prepared under this section at
any time if the commission finds that removal of a dam will occur
earlier or later than 2020.
(2) An affected public utility shall use the depreciation
schedules prepared under this section to establish rates and
tariffs for the recovery of undepreciated amounts prudently
invested by the public utility in a Klamath River dam. Amounts
recoverable under this section include:
(a) Return on the investment;
(b) Capital improvements required by the United States for
continued operations of the dam;
(c) Amounts spent by the utility in seeking relicensing of the
dam before the effective date of this 2009 Act;
(d) Amounts spent by the public utility under a settlement of
the issues of relicensing or decommissioning of the dam; and
(e) Amounts spent by the public utility for decommissioning of
the dam in anticipation of the dam's removal.
(3) If all amounts specified under subsection (2) of this
section have not been recovered by an affected utility before a
dam is removed, the commission shall allow recovery of those
amounts by the public utility in the public utility's rates and
tariffs without an amortization schedule. + }
SECTION 4. { + Recovery of costs of removing Klamath River
dams; surcharges. + } { + (1) The Public Utility Commission
shall require an affected public utility to collect two
surcharges from its customers for the purpose of recovering the
costs incurred by the public utility for removal of Klamath River
dams, as follows:
(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.
(2) The surcharges required under this section shall be a
specified amount per kilowatt hour, as determined by the
commission. Subject to subsection (3) of this section, the amount
of each surcharge shall be calculated based on an amortization
schedule beginning on the date the surcharge is first collected
and ending on December 31, 2020. The commission may change the
amortization schedule if the commission finds that a
hydroelectric facility will be removed earlier or later than
2020.
(3) The commission shall set the amount of the surcharges under
this section to ensure that the total amount collected in a
calendar year under both surcharges does not exceed more than two
percent of an affected public utility's gross annual revenue from
rates as determined by the last general rate case for the public
utility decided by the commission before January 1, 2010.
(4) The commission shall require an affected public utility to
equalize, to the extent practicable, the surcharges imposed on a
customer so that the customer pays the same amount for each
surcharge in each calendar year.
(5) 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.
(6) 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 may:
(a) Direct the trustee of the appropriate trust account under
section 5 of this 2009 Act to refund to the customers from which
the amounts were collected, or to otherwise use the excess
amounts for the benefit of the customers from which the amounts
were collected; or
(b) Adjust future surcharge amounts as necessary to offset the
excess amounts.
(7) If the commission determines at any time that a Klamath
River dam will not be removed, the commission may terminate
collection of all or part of the surcharges under this section
and direct the trustee of the appropriate trust account under
section 5 of this 2009 Act to refund the amounts in the trust
account to the customers from which the amounts were collected or
to otherwise use those amounts for the benefit of those
customers. + }
SECTION 5. { + Recovery of costs of removing Klamath River
dams; 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 in a depository that is qualified under
ORS 295.001 to 295.108 to receive public funds.
(2) 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
or designee the amounts that are necessary to pay the costs of
removing the Klamath River dams.
(3) If any amounts remain in a trust account established under
this section after the trustee makes all payments necessary for
the costs of removing Klamath River dams, the commission shall
direct the trustee of the account to refund those amounts to the
customers from which the amounts were collected, or to otherwise
use the excess amounts for the benefit of the customers from
which the amounts were collected. + }
SECTION 6. { + Recovery of other costs incurred by affected
public utilities. The Public Utility Commission shall allow an
affected public utility to include in its rates and tariffs any
costs that are prudently incurred by an affected public utility
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. { + Apportionment of costs with California
residents. + } { + The Public Utility Commission may enter into
an agreement with representatives of the State of California to
apportion costs fairly between residents of California and
residents of this state that are customers of an affected public
utility. + }
SECTION 8. { + Study by affected public utilities; report by
Public Utility Commission. (1) The Public Utility Commission
shall require affected public utilities to submit a study showing
the costs, benefits and risks for customers of removing or
relicensing the Klamath River dams, based on assumptions
specified by the commission.
(2) Upon submission of a study required by this section, the
commission shall conduct a proceeding for the purpose of
receiving comments on the study from the commission's staff and
other interested persons.
(3) After completion of a proceeding required under subsection
(2) of this section, the commission shall issue a report on the
study and the comments received in the proceeding. On or before
December 31, 2010, the commission shall provide the report, and a
copy of the record in the proceeding, to the Governor.
(4) The commission may not use any commercially sensitive
information provided to the commission in the study required by
this section for any purpose other than determining the costs,
benefits and risks for retail electric customers of removing or
relicensing the Klamath River dams. Notwithstanding ORS 192.410
to 192.505, the commission may not release commercially sensitive
information provided to the commission in the study required by
this section, and shall require any person participating in a
proceeding to sign a protective order prepared by the commission
before allowing the participant to obtain and use the
information. + }
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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