§ 39-1-27.3. Electric distribution companies required to provide retail access, standard offer
and last-resort service.
(a) To promote economic development and the creation and preservation of employment opportunities
within the state, each electric distribution company, except Pascoag Utility District
and the Block Island Utility District, a quasi-municipal corporation, district, and
subdivision of the state ("electric distribution company�), shall offer retail access
from nonregulated power producers to all customers.
(b) Through year 2009, and effective July 1, 2007, through year 2020, each electric distribution
company shall arrange for a standard power-supply offer ("standard offer�) to customers
that have not elected to enter into power-supply arrangements with other nonregulated
power suppliers. The rates that are charged by the electric distribution company to
customers for standard-offer service shall be approved by the commission and shall
be designed to recover the electric distribution company's costs and no more than
the electric distribution company's costs; provided, that the commission may establish
and/or implement a rate that averages the costs over periods of time. The electric
distribution company shall not be entitled to recover any profit margin on the sale
of standard-offer power, except with approval of the commission as may be necessary
to implement, fairly and effectively, system reliability and least-cost procurement.
The electric distribution company will be entitled to recover its costs incurred from
providing the standard offer arising out of: (1) Wholesale standard-offer supply agreements
with power suppliers in effect prior to January 1, 2002; (2) Power-supply arrangements
that are approved by the commission after January 1, 2002; (3) Power-supply arrangements
made pursuant to §§ 39-1-27.3.1 and 39-1-27.8; and (4) Any other power-supply-related arrangements prudently made after January
1, 2002, to provide standard-offer supply or to mitigate standard-offer supply costs,
including costs for system reliability, procurement, and least-cost procurement, as
provided for in § 39-1-27.7. Subject to commission approval, the electric distribution company may enter into
financial contracts designed to hedge fuel-related or other variable costs associated
with power-supply arrangements and the costs of any such financial contracts shall
be recoverable in standard-offer rates. The electric distribution company's standard-offer
revenues and its standard-offer costs shall be accounted for and reconciled with interest
at least annually. Except as otherwise may be directed by the commission in order
to accomplish purposes established by law, any over recoveries shall be refunded to
customers in a manner directed by the commission, and any under recoveries shall be
recovered by the electric distribution company through a uniform adjustment factor
approved by the commission. The commission shall have the discretion to apply such
adjustment factor in any given instance to all customers or to such specific class
of customers that the commission deems equitable under the circumstances provided
that the distribution company recovers any under recovery in its entirety. Once a
customer has elected to enter into a power-supply arrangement with a nonregulated
power producer, the electric distribution company shall not be required to arrange
for the standard offer to such customer except as provided in § 39-1-27.3.1. No customer who initially elects the standard offer and then chooses an alternative
supplier shall be required to pay any withdrawal fee or penalty to the provider of
the standard offer unless such a penalty or withdrawal fee was agreed to as part of
a contract; however, no residential customer shall be required to pay a penalty or
withdrawal fee for choosing an alternative supplier. Nothing in this subsection shall
be construed to restrict the right of any nonregulated power producer to offer to
sell power to customers at a price comparable to that of the standard offer specified
pursuant to this subsection. The electric distribution company may not terminate an
existing standard-offer wholesale supply agreement without the written consent of
the division.
(c) In recognition that electricity is an essential service, each electric distribution
company shall arrange for a last-resort power supply for customers who have left the
standard offer for any reason and are not otherwise receiving electric service from
nonregulated power producers. The electric distribution company shall procure last-resort
service supply from wholesale power suppliers. Prior to acquiring last-resort supply,
the electric distribution company will file with the commission a supply acquisition
plan or plans that include the acquisition procedure, the pricing options being sought,
and a proposed term of service for which last-resort service will be acquired. The
term of service may be short- or long-term and acquisitions may occur from time to
time and for more than one supplier for segments of last-resort service load over
different terms, if appropriate. All the components of the acquisition plans, however,
shall be subject to commission review and approval. Once an acquisition plan is approved
by the commission, the electric distribution company shall be authorized to acquire
last-resort service supply consistent with the approved acquisition plan and recover
its costs incurred from providing last-resort service pursuant to the approved acquisition
plan. The commission may periodically review the acquisition plan to determine whether
it should be prospectively modified due to changed market conditions. The commission
shall have the authority and discretion to approve special tariff conditions and rates
proposed by the electric distribution company that the commission finds are in the
public interest, including without limitation: (1) Short- or long-term optional service
at different rates; (2) Term commitments or notice provisions before individual customers
leave last-resort service; (3) Last-resort service rates for residential or any other
special class of customers that are different than the rates for other last-resort
customers; and/or (4) Last-resort service rates that are designed to encourage any
class of customers to return to the market. The electric distribution company's last-resort
service revenues and its last-resort service costs shall be accounted for and reconciled
with interest at least annually. Any over recoveries shall be refunded and any under
recoveries shall be recovered by the electric distribution company through a uniform
adjustment factor approved by the commission. The commission shall have the discretion
to apply such adjustment factor in any given instance to all customers or to such
specific class of customers that the commission deems equitable under the circumstances
provided that the distribution company recovers any under recovery in its entirety.
Nothing in this section shall be construed to prohibit an electric distribution company
from terminating service provided hereunder in accordance with commission rules and
regulations in the event of nonpayment of this service. The commission may promulgate
regulations to implement this section including the terms and conditions upon which
last-resort service is offered and provided to customers.
(d) If a customer being served by a nonregulated power producer pays any taxes assessed
for electric service to the electric distribution company and the electric distribution
company forwards such tax payment for the power portion of the bill to a nonregulated
power producer for payment by the nonregulated power producer to the state, neither
the customer nor the electric distribution company shall be liable for such taxes
forwarded if the nonregulated power producer fails to remit such taxes to the state
for any reason.