SB433: (New Title) establishing a committee to study utility rate review by the public utilities commission.

SB 433-FN - AS AMENDED BY THE SENATE

03/17/04 0812s

2004 SESSION

04-3106

09/10

SENATE BILL 433-FN

AN ACT establishing a committee to study utility rate review by the public utilities commission.

SPONSORS: Sen. Green, Dist 6; Sen. Prescott, Dist 23; Rep. Ross, Hills 44; Rep. Stone, Rock 73

COMMITTEE: Energy and Economic Development

AMENDED ANALYSIS

This bill establishes a committee to study utility rate review by the public utilities commission.

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Explanation: Matter added to current law appears in bold italics.

Matter removed from current law appears [in brackets and struckthrough.]

Matter which is either (a) all new or (b) repealed and reenacted appears in regular type.

03/17/04 0812s

04-3106

09/10

STATE OF NEW HAMPSHIRE

In the Year of Our Lord Two Thousand Four

AN ACT establishing a committee to study utility rate review by the public utilities commission.

Be it Enacted by the Senate and House of Representatives in General Court convened:

1 Committee Established. There is established a committee to study utility rate review by the public utilities commission.

2 Membership and Compensation.

I. The members of the committee shall be as follows:

(a) Three members of the senate, appointed by the president of the senate.

(b) Three members of the house of representatives, appointed by the speaker of the house of representatives.

II. Members of the committee shall receive mileage at the legislative rate when attending to the duties of the committee.

3 Duties. The committee shall conduct a study of utility rate review procedures and practices by the public utilities commission. The committee shall consider the frequency and scope of desk analyses, field audits, and rate cases conducted by the public utilities commission. The committee shall also examine instituting new reporting requirements on utility rate reviews and the availability of information to the public concerning rate review processes and outcomes. The committee shall also consider potential costs and savings of various options.

4 Chairperson; Quorum. The members of the study committee shall elect a chairperson from among the members. The first meeting of the committee shall be called by the first-named senate member. The first meeting of the committee shall be held within 45 days of the effective date of this section. Four members of the committee shall constitute a quorum.

5 Report. The committee shall report its findings and any recommendations for proposed legislation to the senate president, the speaker of the house of representatives, the senate clerk, the house clerk, the governor, and the state library on or before November 30, 2004.

6 Effective Date. This act shall take effect upon its passage.

LBAO

04-3106

Revised 1/29/04

SB 433 FISCAL NOTE

AN ACT requiring the public utilities commission to conduct a comprehensive study of utility rates every 5 years.

FISCAL IMPACT:

The Public Utilities Commission has determined this bill may increase state revenue and expenditures and county and local expenditures by an indeterminable amount in FY 2005 and each year thereafter. There will be no fiscal on county and local revenue.

METHODOLOGY:

The Commission stated this bill would require the Commission to conduct a comprehensive rate study of all utility rates once every 5 years, and to submit a report of findings and recommendations to certain state leaders. Costs cannot be determined because it is unclear what kind of study is contemplated by the proposal. If the proposal requires the Commission to develop a list of utilities and rates, the cost could be absorbed. If the proposal requires the Commission to conduct an analysis of the rates and the validity of various elements that constitute the rates, the Commission could incur significant costs. These costs would be passed on to utilities, and in turn to ratepayers, including governmental ratepayers. An example of the amount of such costs is the recent audit of a major utility that cost $437,000. In addition, depending on the kind of study of utilities regulated by the Federal Communications Commission and the Federal Energy Regulatory Commission, significant and unknown costs could be incurred by the Commission which would eventually be paid by all ratepayers.