Florida Senate - 2019 COMMITTEE AMENDMENT Bill No. SB 796 Ì352908<Î352908 LEGISLATIVE ACTION Senate . House . . . . . ————————————————————————————————————————————————————————————————— ————————————————————————————————————————————————————————————————— The Committee on Innovation, Industry, and Technology (Gruters) recommended the following: 1 Senate Amendment (with title amendment) 2 3 Delete everything after the enacting clause 4 and insert: 5 Section 1. Section 366.96, Florida Statutes, is created to 6 read: 7 366.96 Storm protection plan cost recovery.— 8 (1) The Legislature finds that: 9 (a) During extreme weather conditions, high winds can cause 10 vegetation and debris to blow into and damage electrical 11 transmission and distribution facilities, resulting in power 12 outages. 13 (b) A majority of the power outages that occurred during 14 the recent extreme weather conditions in the state were caused 15 by vegetation blown by the wind. 16 (c) It is in the public interest to promote overhead 17 hardening of electrical transmission and distribution 18 facilities, the undergrounding of certain electrical 19 distribution lines, and vegetation management in this state. 20 (d) Protecting and strengthening transmission and 21 distribution electric utility infrastructure from extreme 22 weather conditions will reduce restoration costs and outage 23 times to customers and improve overall service reliability for 24 customers. 25 (e) When considering costs, reliability, storm protection 26 and restoration, and the public convenience, it is in the 27 state’s best interest that utilities focus primarily on 28 distribution laterals when undergrounding electric distribution 29 lines. 30 (f) It is in the public interest for each utility to 31 mitigate additional costs to utility customers when developing 32 transmission and distribution storm hardening plans. 33 (g) All customers benefit the reduced costs of storm 34 restoration. 35 (2) As used in this section, the term: 36 (a) “Transmission and distribution storm protection plan” 37 or “plan” means a plan for the overhead hardening of electric 38 transmission and distribution facilities, undergrounding of 39 electric distribution facilities, and increased vegetation 40 management. 41 (b) “Transmission and distribution storm protection plan 42 costs” means the reasonable and prudent costs to implement an 43 approved transmission and distribution storm protection plan. 44 (c) “Vegetation management” means the actions a public 45 utility takes to prevent or curtail vegetation from interfering 46 with public utility infrastructure. The term includes the mowing 47 of vegetation, application of herbicides, trimming of trees, and 48 removal of trees or brush near and around electric transmission 49 and distribution facilities. 50 (3) Each public utility shall file for commission review, 51 as part of its storm hardening plan required by the commission 52 under s. 366.04(2)(c), a transmission and distribution storm 53 protection plan that covers 30 years. The commission must 54 approve or modify the plan within 6 months after the public 55 utility files the plan with the commission. The commission must 56 give due consideration to whether: 57 (a) The plan enhances reliability, strengthens 58 infrastructure, and reduces restoration costs and outage times 59 in a prudent, practical and cost-efficient manner. The plan 60 should prioritize areas in order to generate the highest impact 61 on system resiliency and efficiency and should focus on areas 62 with large numbers of customers, high frequency outages, and 63 lengthy outages. 64 (b) Storm protection of transmission and distribution 65 infrastructure is feasible, reasonable, or practical in certain 66 areas of the utility’s service territory, including in flood 67 zones and rural areas. 68 (4) Each public utility must submit an updated transmission 69 and distribution storm protection plan at least every 3 years 70 after commission approval of its most recent plan. 71 (5)(a) The commission shall conduct an annual proceeding to 72 allow a public utility to justify and recover transmission and 73 distribution storm protection plan costs through a storm 74 protection cost recovery clause. 75 (b) Action taken by a public utility for storm protection 76 of transmission and distribution facilities pursuant to a 77 commission-approved plan is deemed prudent, but a party may 78 challenge the commission’s determination of prudence. 79 (6) The annual transmission and distribution storm 80 protection plan costs recoverable through the storm protection 81 cost recovery clause must be stated separately from the public 82 utility’s base rates and must be allocated to customer classes 83 pursuant to the rate design most recently approved by the 84 commission. 85 (7) If a capital expenditure cost is recoverable through a 86 storm protection cost recovery clause, the public utility may 87 recover the annual depreciation on such cost, calculated at the 88 public utility’s current approved depreciation rates, and a 89 return on the depreciated balance of the costs calculated at the 90 public utility’s weighted average cost of capital using the 91 return on equity last approved by the commission in a rate case 92 or settlement order. 93 (8) The commission shall adopt rules to implement and 94 administer this section. 95 Section 2. This act shall take effect July 1, 2019. 96 97 ================= T I T L E A M E N D M E N T ================ 98 And the title is amended as follows: 99 Delete everything before the enacting clause 100 and insert: 101 A bill to be entitled 102 An act relating to public utility storm protection 103 plans; creating s. 366.96, F.S.; providing legislative 104 findings; defining terms; requiring public utilities 105 to individually submit to the Public Service 106 Commission, for review and approval, a transmission 107 and distribution storm protection plan as part of the 108 storm hardening plan required by the commission; 109 requiring utilities to update their respective plans 110 on a specified basis; requiring the commission to 111 approve or modify submitted plans within a specified 112 timeframe, taking into consideration specified 113 factors; requiring the commission to conduct an annual 114 proceeding to allow utilities to justify and recover 115 certain costs through a storm protection cost recovery 116 clause; providing that a party may challenge the 117 prudence of certain costs; providing that utilities 118 may not include certain costs in their base rates; 119 providing for the allocation of such costs; 120 authorizing utilities to recover depreciation on 121 certain capital costs through the recovery clause; 122 requiring the commission to adopt rules; providing an 123 effective date.