§ 8-1-2.3-6 — Change of service area boundaries

Indiana § 8-1-2.3-6

• Jurisdiction: Indiana
• Art. 1: UTILITIES GENERALLY
• Ch. 2.3: Electricity Suppliers' Service Area Assignments

Text

(a) The boundaries of the assigned service areas
of electricity suppliers may not be changed except under one (1) of the
following circumstances:
(1) Except as provided in subsection (b), if a municipality which
owns and operates an electric utility system furnishing retail
electric service to the public annexes an area beyond the assigned
service area of its municipally owned electric utility, the
municipally owned electric utility may petition the commission to
change the assigned service area of the municipally owned
electric utility to include the annexed area, according to the
following procedures:
(A) The municipally owned electric utility shall file its petition
with the commission not later than sixty (60) days after the
annexation becomes effective. The petition must include a
certified copy of the annexation ordinance, which serves as
conclusive evidence that the area has been lawfully annexed
and is part of the municipality. After the filing of a petition
under this subdivision, the commission shall promptly enter an
order changing the assigned service area facet maps of the
municipally owned electric utility and incumbent electricity
suppliers to include the annexed area within the assigned
service area of the municipally owned electric utility and giving
the right to serve and immediate possession to the municipally
owned electric utility. The commission order is enforceable in
court pending an appeal of that order. An appellant from a court
order enforcing a commission order under this subdivision is
not entitled to a stay of the court order pending appeal.
However, this subdivision does not apply to incorporations,
consolidations, mergers, or annexations that are under IC 36-4-3-4(a)(3), IC 36-4-3-4(b), IC 36-4-3-4(h), or IC 36-4-3-4.1
or that are not contiguous under IC 36-4-3-13(b) or IC 36-4-3-13(c).
(B) Not later than thirty (30) days after filing a petition under
this subdivision, the municipally owned electric utility shall
determine for each affected incumbent electricity supplier and
pay to that supplier an amount not less than the value of all the
electric utility property of the incumbent electricity supplier
that is devoted to furnishing retail electric service within the
additional assigned service area at its then reproduction cost
new depreciated value. In addition, the municipally owned
electric utility shall pay the incumbent electricity supplier
severance damages in an amount equal to:
(i) the value of the incumbent electricity supplier's
distribution and substation facilities dedicated to and located
within the annexed area or relocated by reason of the
annexation or an amount equal to two and one-half (2 1/2)
times the incumbent electricity supplier's gross revenues from
electricity sales in the annexed area during the twelve (12)
month period immediately preceding the date the annexation
ordinance became effective, whichever is greater; plus
(ii) if additional permanent service locations or service
accounts are established in the annexed area during the five
(5) year period beginning on the effective date of the
annexation ordinance, one-tenth of one cent ($0.001) for each
kilowatt hour of electricity sold to each of those permanent
service locations or service accounts for sales that occur
during a five (5) year period beginning on the date each
service location or service account is established, up to a
maximum of one hundred seventy thousand (170,000)
kilowatt hours per service account or service location for
each monthly billing period.
However, the municipally owned electric utility is not required
to pay severance damages under item (ii) if, at the time each
annual payment otherwise would accrue, it is purchasing all of
its requirements for electric power and energy, except for
generation directly provided by the municipally owned electric
utility or by a customer, from the incumbent electricity supplier.
Severance damages must be paid not later than thirty (30) days
after the end of each calendar year in which severance damages
have accrued. The municipally owned electric utility and
incumbent electricity suppliers shall cooperate to calculate the
amount of any severance damages and shall furnish to each
other all information and records reasonably necessary for the
determination and verification of severance damages. If the
municipally owned electric utility and incumbent electricity
suppliers cannot agree on the amount of severance damages the
municipally owned electric utility is to pay, the commission
shall determine the amount and order payment in accordance
with this clause. Not later than twenty (20) days after making a
payment, the municipally owned electric utility shall certify to
the commission and to any affected incumbent electricity
supplier that it has paid the amounts required under this clause.
(C) If the municipally owned electric utility fails to make a
payment under clause (B), an affected incumbent electricity
supplier may, not later than sixty (60) days after the payment is
due and after giving the municipally owned electric utility
reasonable notice of and an opportunity to cure the defect, file
with the commission a petition alleging that a payment due
under clause (B) has not been made. If the commission finds
after notice and hearing that any payments owed to the
incumbent electricity supplier have not been timely and fully
paid, the commission shall order the municipally owned electric
utility to pay:
(i) the delinquent payments by a date determined by the
commission;
(ii) accrued interest at the rate set forth in IC 24-4.6-1-102;
and
(iii) the incumbent electricity supplier's costs of filing and
prosecuting a petition under this clause.
If the commission finds against the incumbent electricity
supplier, it shall order the incumbent electricity supplier to pay
the costs incurred by the municipally owned electric utility in
defending against the incumbent electricity supplier's petition.
(D) A certified copy of a final commission order that:
(i) determines and orders the payment of severance damages
under clause (B); or
(ii) orders the payment of delinquent payments, interest, and
costs under clause (C);
may be filed with the clerk of the circuit or superior court of
any county in which part or all of the annexed area is located.
A commission order that is filed in a court under this clause
may be enforced and executed in the same manner as if it were
a final judgment of that court.
(2) Upon mutual agreement of the affected electricity suppliers
and approval of the commission. If notice of a verified request for
a change of boundary lines by mutual agreement under this
subdivision is published in a newspaper of general circulation in
every county in which the boundary lines are located and an
affected electricity customer does not request a hearing within
twenty (20) days of the last date of publication, the commission
may approve the change without a hearing. The commission shall
approve a boundary line change under this subdivision unless the
commission finds, after a public hearing, that the change would
cause:
(A) duplication of electric utility facilities;
(B) waste of materials or resources; or
(C) uneconomic, inefficient, or inadequate electric service to
the public.
(3) In the case where a landowner owns a single tract of land that
is intersected by the boundary lines of two (2) or more assigned
service areas, and retail electric service can best be supplied by
only one (1) electricity supplier, or in the case where a customer
or customers are housed in a single structure or constitute a single
governmental, industrial, or institutional operation, and the
electricity suppliers involved are unable to agree which shall
furnish the electric service, any of the electricity suppliers may
submit the matter to the commission for its determination based
upon public convenience and necessity. If, after notice and
hearing, the commission determines that one (1) or more
electricity suppliers are to supply the required retail electric
service and the boundaries of an assigned service area are to be
changed, the assigned service area maps of the electricity
suppliers shall be changed to reflect the new boundaries.
(b) After May 19, 2015, a municipality that:
(1) owns and operates an electric utility system furnishing retail
electric service to the public; and
(2) annexes an area beyond the assigned service area of its
municipally owned electric utility;
may not petition the commission to change the assigned service area of
the municipally owned electric utility to include the annexed area
according to the procedures set forth in subsection (a)(1). After May
19, 2015, the boundaries of the assigned service areas of electricity
suppliers may be changed only according to the procedures set forth in
subsection (a)(2) or (a)(3), as applicable. This subsection does not
affect a petition that is filed with the commission under subsection
(a)(1) before May 20, 2015, and pending before the commission on
May 20, 2015.
As added by Acts 1980, P.L.69, SEC.1. Amended by
P.L.91-1985, SEC.1; P.L.19-1986, SEC.27; P.L.79-1996, SEC.1;
P.L.255-1997(ss), SEC.7; P.L.217-1999, SEC.1; P.L.56-2002, SEC.1;
P.L.31-2015, SEC.1.