Florida Senate - 2019 COMMITTEE AMENDMENT Bill No. CS for SB 796 Ì692530}Î692530 LEGISLATIVE ACTION Senate . House . . . . . ————————————————————————————————————————————————————————————————— ————————————————————————————————————————————————————————————————— The Committee on Infrastructure and Security (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 from the reduced costs of storm 34 restoration. 35 (2) As used in this section, the term: 36 (a) “Public utility” or “utility” has the same meaning as 37 in s. 366.02(1), except that this section does not apply to a 38 gas utility. 39 (b) “Transmission and distribution storm protection plan” 40 or “plan” means a plan for the overhead hardening of electric 41 transmission and distribution facilities, undergrounding of 42 electric distribution facilities, and vegetation management. 43 (c) “Transmission and distribution storm protection plan 44 costs” means the reasonable and prudent costs to implement an 45 approved transmission and distribution storm protection plan. 46 (d) “Vegetation management” means the actions a public 47 utility takes to prevent or curtail vegetation from interfering 48 with public utility infrastructure. The term includes the mowing 49 of vegetation, application of herbicides, trimming of trees, and 50 removal of trees or brush near and around electric transmission 51 and distribution facilities. 52 (3) Each public utility shall file for commission review, a 53 transmission and distribution storm protection plan that covers 54 the utility’s immediate 10-year planning period. The commission 55 must approve or modify the plan within 6 months after the public 56 utility files the plan with the commission. The commission must 57 give due consideration to all of the following: 58 (a) Whether the plan enhances reliability, strengthens 59 infrastructure, and reduces restoration costs and outage times 60 in a prudent, practical, and cost-efficient manner, including 61 whether the plan prioritizes areas of lower reliability 62 performance. 63 (b) Whether storm protection of transmission and 64 distribution infrastructure is feasible, reasonable, or 65 practical in certain areas of the utility’s service territory, 66 including in flood zones and rural areas. 67 (c) The estimated rate impact that will result from the 68 implementation of the public utility’s proposed transmission and 69 distribution storm protection plan during the first 3 years 70 addressed in the plan. 71 (4) Each public utility must submit an updated transmission 72 and distribution storm protection plan at least every 3 years 73 after commission approval of its most recent plan. The 74 commission shall approve or modify each updated plan pursuant to 75 the criteria set forth in subsection (3). 76 (5) After a storm protection plan has been approved, costs 77 to implement the plan are not subject to challenge unless the 78 commission finds that certain costs were imprudently incurred. 79 Proceeding with actions to implement the plan does not 80 constitute and is not evidence of imprudence. The commission 81 shall conduct an annual proceeding to allow a public utility to 82 recover prudently incurred transmission and distribution storm 83 protection plan costs through a storm protection cost recovery 84 clause. Once the commission determines that the costs were 85 prudently incurred, the costs are not subject to disallowance or 86 further prudence review, except for situations involving fraud, 87 perjury, or the intentional withholding of key information by 88 the public utility. 89 (6) The annual transmission and distribution storm 90 protection plan costs recoverable through the storm protection 91 cost recovery clause do not include costs recovered through the 92 public utility’s base rates and must be allocated to customer 93 classes pursuant to the rate design most recently approved by 94 the commission. 95 (7) If a capital expenditure cost is recoverable through a 96 storm protection cost recovery clause, the public utility may 97 recover the annual depreciation on such cost, calculated at the 98 public utility’s current approved depreciation rates, and a 99 return on the undepreciated balance of the costs calculated at 100 the public utility’s weighted average cost of capital using the 101 return on equity last approved by the commission in a rate case 102 or settlement order. 103 (8) The commission shall adopt rules to implement and 104 administer this section. 105 Section 2. This act shall take effect July 1, 2019. 106 107 ================= T I T L E A M E N D M E N T ================ 108 And the title is amended as follows: 109 Delete everything before the enacting clause 110 and insert: 111 A bill to be entitled 112 An act relating to public utility storm protection 113 plans; creating s. 366.96, F.S.; providing legislative 114 findings; defining terms; requiring public utilities 115 to individually submit to the Public Service 116 Commission, for review and approval, a transmission 117 and distribution storm protection plan; requiring 118 utilities to update their respective plans on a 119 specified basis; requiring the commission to approve 120 or modify submitted plans within a specified 121 timeframe, taking into consideration specified 122 factors; requiring the commission to conduct an annual 123 proceeding to allow utilities to justify and recover 124 certain costs through a storm protection cost recovery 125 clause; providing that a party may challenge the 126 prudence of certain costs; providing that utilities 127 may not include certain costs in their base rates; 128 providing for the allocation of such costs; 129 authorizing utilities to recover depreciation on 130 certain capital costs through the recovery clause; 131 requiring the commission to adopt rules; providing an 132 effective date.