HB 169: "An Act directing the Regulatory Commission of Alaska to provide a report to the legislature relating to electrical transmission in certain areas of the state; and providing for an effective date."

00 HOUSE BILL NO. 169 01 "An Act directing the Regulatory Commission of Alaska to provide a report to the 02 legislature relating to electrical transmission in certain areas of the state; and providing 03 for an effective date." 04 BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF ALASKA: 05 * Section 1. The uncodified law of the State of Alaska is amended by adding a new section 06 to read: 07 REVIEW OF ELECTRIC UTILITY INTERCONNECTION. (a) The commission 08 shall, not later than July 1, 2016, or as soon as practicable thereafter, provide a report to the 09 legislature determining whether creating an independent entity that meets the requirements of 10 (b) of this section to manage the electrical transmission facilities in the Railbelt area is the 11 best option to provide for effective and efficient electrical transmission, including economical 12 distribution, reliability of electrical service, and nondiscriminatory, open access to 13 transmission services. The commission shall also, if findings warrant, provide suggested 14 legislation and changes to the regulations of the commission in the report.

01 (b) In the report under (a) of this section, the commission shall evaluate the creation 02 of an independent entity that 03 (1) is regulated the commission; 04 (2) is directed by a board of directors composed of stakeholders in Railbelt 05 transmission facilities; 06 (3) has operational authority over the electrical transmission facilities of the 07 Railbelt area; 08 (4) has the primary responsibility to ensure the reliability of the electrical 09 transmission facilities of the Railbelt area; 10 (5) will optimize the use of existing electrical transmission resources and will, 11 where possible, avoid duplication of facilities; 12 (6) has the power to 13 (A) adopt, maintain, and reinforce reliability standards by adopting an 14 equivalent national reliability standard; 15 (B) plan, coordinate, and condition necessary additions and 16 improvements to the transmission system; 17 (C) manage the interconnection of new generation facilities; 18 (D) administer a regional transmission tariff and employ a pricing 19 system to promote the open access, efficient use, and expansion of transmission 20 systems and generation facilities; 21 (E) manage parallel path flow and transmission congestion and create a 22 voluntary and transparent wholesale energy market. 23 (c) While preparing the report described in (a) of this section, the commission shall 24 assume that 25 (1) rate recovery is ensured through the planning, permitting, and construction 26 phases of projects planned by the independent entity; 27 (2) the cost recovery of existing investments is ensured; 28 (3) regional tariff rates will be just, fair, and reasonable for all ratepayers and 29 allow transitional rates to minimize the effect on an individual utility; and 30 (4) existing transmission systems used for the benefit of the Railbelt area will 31 be allowed full cost recovery from the independent entity, including costs for depreciation,

01 interest, margin, operations, maintenance, applicable taxes, and general and administrative 02 expenses necessary for the operation of a transmission system. 03 (d) The recommendations in the report required in this section may not affect dockets 04 open before the effective date of this Act. 05 (e) In this section, "commission" means the Regulatory Commission of Alaska. 06 * Sec. 2. This Act takes effect immediately under AS 01.10.070(c).