§ 369-B:4 — Establishment of RRB Charge to Recover RRB Costs

I. A finance order shall establish and place into effect one or more RRB charges that the commission shall determine to be just and reasonable, including any provisions for subsequent adjustments thereto, that shall provide for the collection of revenues from retail customers of electric utilities sufficient to recover all RRB costs approved by the commission in the finance order, including, without limitation, the payment of principal, premium, if any, interest, credit enhancement, and all other fees, costs, and charges in respect to rate reduction bonds. Such RRB charge or RRB charges shall be set forth in a schedule or schedules filed with the commission in such form as may be determined by the commission, but the filing of such schedule shall not affect or be a condition to the validity of the RRB charge.
II. The commission shall set the RRB charge, per kilowatt-hour of electricity for delivery of retail electric service, in an amount necessary and sufficient to provide for the full recovery of principal, interest, and credit enhancement on the rate reduction bonds, in accordance with the amortization schedule for such bonds determined at the time of offering, as well as all other fees, costs, and charges in respect to the rate reduction bonds, based upon the electric utility's reasonable assumptions, including sales forecasts.
III. Notwithstanding any provision of RSA 369-B:3, the commission shall approve such adjustments to the RRB charge authorized to be imposed and collected pursuant to a finance order as may be necessary to ensure timely recovery of all RRB costs that are the subject of such finance order, including, without limitation, the costs of capital associated with the provision, recovery, financing, or refinancing thereof and the costs of issuing, servicing, and retiring the rate reduction bonds contemplated by such finance order. Such RRB charge shall be adjusted periodically, but not less frequently than annually nor more frequently than monthly, in accordance with the finance order. The commission shall provide in a finance order for a procedure for the timely approval by the commission of periodic adjustments to the RRB charge that is the subject of such finance order. The commission shall approve such adjustments within 60 days of the filing of such adjustment, or within such shorter period as the finance order may designate. These adjustments shall generally serve to reconcile the actual RRB charges collected with the RRB charges expected to have been collected during the relevant prior period in a manner such that the adjusted RRB charge will be sufficient to provide for scheduled principal, interest, credit enhancement, fees and other expenses associated with rate reduction bonds payable in the period during which such adjusted RRB charge will be billed. The electric utility shall include in such filing a report to the commission showing the calculation of each such adjustment.
IV. All charges established in a finance order for an electric utility, including, without limitation, the non-bypassable RRB charge, shall be collected from each retail customer of such electric utility by such electric utility or servicer of the rate reduction bonds or other entity authorized in the finance order or otherwise approved by the commission. If a retail customer purchases or otherwise obtains retail electric service from any person other than the electric utility in whose service territory the retail customer is located, including, without limitation, any successor referred to in RSA 369-B:8, subject to commission approval, the servicer or such new electricity service provider or successor shall collect all such charges, including, without limitation, such RRB charge, from the retail customer by or on behalf of the first electric utility with revenues from such RRB charge remitted solely for the benefit and repayment of rate reduction bonds as a condition to the provision of retail electric service to such retail customer. Each finance order shall impose commercially reasonable terms on such electricity service provider or successor responsible for billing or collecting such charges, including, without limitation, such RRB charge, that are the subject of the finance order. Any retail customer that fails to pay any RRB charge shall be subject to disconnection of service to the same extent that such customer would, under applicable law and regulations, be subject to disconnection of service for failure to pay any other charge payable to an electric utility.
V. The RRB charge shall be charged to and collected from retail customers for such period as prescribed in the finance order. To the extent that the commission, when issuing a finance order, determines that special treatment on retail customers' bills is necessary or desirable to distinguish the RRB charge from other rates and charges in order to facilitate the successful issuance and sale of rate reduction bonds, it may so provide as part of such finance order. A finance order shall specify how amounts collected from a retail customer shall be allocated between the RRB charge and other rates and charges.
VI. The commission shall establish charges for retail customers that purchase or otherwise obtain or are supplied back-up, maintenance, emergency or other delivery service provided to a retail customer by an electric utility. Such charges shall be just and reasonable, and shall not be designed in a manner that creates a charge similar to or has the same effect as an exit fee.
VII. Notwithstanding any statutory or regulatory language to the contrary, the commission shall not authorize or impose, nor shall any electric utility charge or assess, any exit fee, and nothing herein shall affect the rights as set forth in RSA 369-B:3, IV(b)(7). An exit fee is any rate or charge that is based in whole or in part on the amount of electric power and/or retail electric service a customer might have purchased from or through an electric utility but does not purchase due to conservation efforts, use of alternative non-electric energy sources, or the consumption of electricity by such customer from generation connected directly to such customer's electrical load with no intervening facilities of a regulated utility; provided, however, that an exit fee shall not include a just and reasonable capacity or demand charge for backup service as defined in RSA 369-B:4, VI.
VIII. In the event of the municipalization of a portion of an electric utility's service territory, the commission shall, in matters over which the Federal Energy Regulatory Commission does not have jurisdiction, or has jurisdiction but chooses to grant jurisdiction to the state, determine, to a just and reasonable extent, the consequential damages such as stranded investment in generation, storage, or supply arrangements resulting from the purchase of plant and property from the electric utility and RRB costs, and shall establish an appropriate recovery mechanism for such damages. Any such damages shall be established, and shall be allocated between the RRB charge and other rates and charges, in a just and reasonable manner.
IX. Any surplus RRB charge in excess of the amounts necessary to pay principal, premium, if any, interest, credit enhancement and all other fees, costs, and charges in respect to rate reduction bonds shall be remitted to the financing entity and shall be used to benefit retail customers unless this would result in a recharacterization of the tax, accounting, and other intended characteristics of the financing, including, but not limited to, the following intended characteristics:
(a) Avoiding the recognition of debt on the electric utility's balance sheet for financial accounting and regulatory purposes;
(b) Treating the rate reduction bonds as debt of the electric utility or its affiliates for federal income tax purposes;
(c) Treating the transfer of the RRB property by the electric utility as a true sale for bankruptcy purposes; or
(d) Avoiding any adverse impact of the financing on the credit rating of the rate reduction bonds or the electric utility.

Legislative History

2000, 249:2, eff. June 12, 2000.