A bill

 

TO AMEND THE SOUTH CAROLINA CODE OF LAWS BY ADDING CHAPTER 32 TO TITLE 58 SO AS TO ALLOW ELIGIBLE CUSTOMERS TO PURCHASE ALL OR PART OF ITS ELECTRICITY DEMAND FROM THIRD-PARTY ELECTRIC SUPPLIERS; TO ESTABLISH RELATED TERMS, CONDITIONS, AND REQUIREMENTS FOR ELIGIBLE CUSTOMERS, THIRD-PARTY ELECTRIC SUPPLIERS, AND INCUMBENT ELECTRIC SUPPLIERS FOR  ELECTRIC SERVICES, INCLUDING TRANSMISSION SERVICES; TO ESTABLISH CERTAIN COST REQUIREMENTS; AND TO ESTABLISH THE PUBLIC SERVICE COMMISSION STANDARDS OF REVIEW, INCLUDING THE REQUIREMENT TO APPROVE A TARIFF CONTAINING A PRO FORMA CONTRACT.

 

Be it enacted by the General Assembly of the State of South Carolina:

 

SECTION 1.  Title 58 of the S.C. Code is amended by adding:

 

CHAPTER 32

 

Third-Party Electric Suppliers

 

    Section 58-32-10.  For purposes of this chapter:

    (1) "Commission" means the Public Service Commission.

    (2) "Customer-sited generation" means an electric generation facility, or combination of electric generation facilities, located on an eligible customer's premises and on the eligible customer's side of the delivery point with a nameplate capacity that does not exceed the eligible customer's estimated maximum demand for electric service and that is solely for the use of the eligible customer. For purposes of this chapter, an owner of customer-sited generation shall not be considered an electrical utility as defined in Section 58-27-10(7).

    (3) "Delivery point" means the point where the facilities of the incumbent electric supplier make physical contact with the facilities of the eligible customer.

    (4) "Distribution services" means electric distribution services, along with any other services required to safely and reliably deliver electric energy.

    (5) "Distribution tariff" means the tariff filed with the commission or the rules otherwise governing electric distribution services provided by an incumbent electric supplier.

    (6) "Electric generation facility" means a facility for generating electric power, including renewable electric generation facilities and generation facilities qualifying under the Public Utility Regulatory Policies Act of 1978 (PURPA), Public Law 95-617, as amended.

    (7) "Electric power" means electric energy, electric capacity or generation-related ancillary services or any combination thereof.

    (8) "Electric supplier" shall have the same meaning as in Section 58-27-610(1) and shall also include the South Carolina Public Service Authority.

    (9) "Eligible customer" means a new or existing individual nonresidential retail electric customer that has an estimated maximum demand for electric service of at least 100 kW at a single delivery point.

    (10) "Full-requirements contract" is a contract whereby the eligible customer agrees to purchase from an electric supplier all of their supply needs from or through the electric supplier, regardless of quantity under contractual terms specific in this contract.

    (11) "Incumbent electric supplier" means an electric supplier or other person or corporation that, pursuant to Article 5, Chapter 27, Title 58 furnishes or has the right to furnish electric service to the eligible customer's premises.

    (12) "Premises" means the building, structure, or facility to which electricity is being or is to be furnished provided that two or more buildings, structures, or facilities which are located on one tract or contiguous tracts of land and are utilized by one electric consumer for farming, business, commercial, industrial, institutional, or governmental purposes, shall together constitute one "premises," except that any such building, structure, or facility shall not, together with any other building, structure, or facility, constitute one "premises" if the electric service to it is separately metered and the charges for such service are calculated independently of charges for service to any other building, structure, or facility.

    (13) "Renewable electric generation facility" means a facility generating electric power from solar photovoltaic resources, wind resources, hydroelectric resources, geothermal resources, tidal and wave energy resources, hydrogen fuel derived from renewable resources, combined heat and power derived from renewable resources, or biomass resources, or any combination thereof. Renewable electric generation facility also includes an electrical energy storage system if the energy stored is generated from one of the resources enumerated in this item.

    (14) "Standby electric service rate" means a rate offered by the incumbent electric supplier to provide replacement energy to an eligible customer when the power supply to such customer purchased under a customer choice option is not available.

    (15) "Third-party electric supplier" means an electric supplier that is not the incumbent electric supplier or a person or corporation that is not an electric supplier but provides electricity generated by an electric generation facility. A third-party electric supplier may be located within or without this State. For purposes of this chapter, a third-party electric supplier shall not be considered an electrical utility as defined in Section 58-27-10(7).

    (16) "Transmission services" means electric transmission services, along with any other services, required to safely and reliably deliver electric energy.

    (17) "Transmission services provider" means any person or corporation owning or operating electric transmission facilities in the State for transmitting, delivering, or furnishing electricity.

    (18) "Transmission tariff" means an open access transmission tariff, reciprocity tariff, or other tariff to provide transmission services unbundled from other services.

 

    Section 58-32-20.  (A) An eligible customer shall be permitted to purchase all or part of its electricity demand from a third-party electric supplier in accordance with the terms of this chapter and federal laws and regulations. An eligible customer shall also be permitted to obtain all or part of its electricity demand from customer-sited generation.

    (B) In the event an eligible customer chooses to obtain all or part of its electric demand from a third-party electric supplier, the eligible customer and the incumbent electric supplier must enter into a contract that, at a minimum, provides:

       (1) the amount of electricity the eligible customer has elected or intends to elect to receive from the third-party electric supplier and detailed arrangements for its energy needs to be provided by the third-party electric supplier, up to and including a full-requirements contract;

       (2) if the eligible customer chooses to receive part of its electricity from the incumbent electric supplier, a firm electricity demand that the eligible customer will receive from the incumbent electric supplier and a commitment to purchase that amount from the incumbent electric supplier;

       (3) conditions for which the incumbent electric supplier may curtail or suspend service to the eligible customer outside of energy emergency alert conditions established by the North American Electric Reliability Corporation, if the eligible customer is not on a standby electric service rate from the incumbent utility; and

       (4) the eligible customer must relieve the incumbent electric supplier from its obligation to provide electricity for the amount to be provided by a third-party electric supplier, including the incumbent electric supplier's obligation to maintain reserves for the eligible customer.

    (C) In the event an eligible customer chooses to obtain all or part of its electric demand from a third-party electric supplier, the customer shall be responsible for ensuring its energy needs are met. The incumbent electric supplier shall be relieved of its obligation to provide energy to the eligible customer in accordance with the terms of the contract described in subsection (B). However, the eligible customer and the incumbent electric supplier may agree to contractual terms, subject to commission review and approval for electrical utilities with commission-approved rates in which the incumbent electric supplier may supply energy to the eligible customer if the third-party electric supplier is unable to meet the eligible customer's demands.

 

    Section 58-32-30.  The eligible customer must provide arrangements for firm transmission services from the third-party electric supplier to have its electricity delivered from the third-party electric supplier's sources to the incumbent electric supplier's transmission system. The incumbent electric supplier shall cooperate with the third-party electric supplier to provide reasonable terms of transmission services, consistent with industry standards, the Open Access Transmission Tariff, and applicable business practices.

 

    Section 58-32-40.  The incumbent electric supplier shall not be liable for any costs associated with the eligible customer's service of electricity from a third-party electric supplier, including transmission services from the third-party electric supplier. However, the incumbent electric supplier shall be responsible for transmission services to the eligible customer for electricity on the incumbent electric supplier's transmission system.

 

    Section 58-32-50.  The incumbent electric supplier must have remote cutoff capabilities in place for an eligible customer who chooses to obtain electricity from a third-party electric supplier so that the incumbent electric supplier may curtail or shut down its electric supply to the eligible customer in accordance with the terms of the agreement. The eligible customer shall elect its third-party electric supplier and shall pay all costs associated with its election, if any.

 

    Section 58-32-60.  In the event an eligible customer requires transmission upgrades, a determination must be made, in accordance with federal laws and regulations, as to whether the transmission upgrade solely benefits the eligible customer or if the upgrade benefits others who the incumbent electric supplier serves. For transmission upgrades that solely benefit the eligible customer, that eligible customer must pay the costs for the upgrade. If transmission upgrades benefit more than solely the eligible customer, in terms of electric service, the incumbent electric supplier and the eligible customer may agree for the eligible customer to pay the incumbent electric supplier for a period of no more than twenty years. If an eligible customer pays for the costs of the transmission upgrade, then they will be exempt from the provisions of Section 58-32-70.

 

    Section 58-32-70.  In the event the incumbent electric supplier factored an eligible customer's energy demand into its planning for electric generation or transmission services, and invested capital accordingly that has been reflected in its rates, and that eligible customer leaves the incumbent electric supplier's territory, the eligible customer must continue to pay for capital costs until the amount the eligible customer would have been responsible for is paid in full or another customer assumes the amount. If growth in the amount of supply being taken by customers of the incumbent electric supplier exceeds the load of the departing eligible customer, this shall constitute a rebuttable presumption that these costs have been assumed consistent with this section. The commission must determine the eligible customer's financial obligation to the incumbent electric supplier in a manner that does not affect residential or other commercial or industrial electric rates. The commission must also determine allowable cost shift methodologies to provide transparency around legacy contracts and stranded assets.

 

    Section 58-32-80.  Incumbent utilities shall provide cost-of-service supply to eligible customers or customer load returning from a period of retail access service on the same terms, rates and priority as a new eligible customer requesting service.

 

    Section 58-32-90.  (A) No later than January 1, 2027, the commission shall approve a tariff containing a pro forma contract that an eligible customer may enter into consistent with this chapter and other state and federal laws. Such a pro forma contract executed by an eligible customer shall be binding on the incumbent electric supplier and the eligible customer and shall fulfill the purposes of Section 58-32-20(B). Any exceptions to the pro forma contract may be approved by the commission only as follows:

       (1) an incumbent electric supplier and an eligible customer file an executed contract which the commission shall approve unless contrary to the public interest; or

       (2) an eligible customer may represent to the commission its binding commitment to be party to an unexecuted contract consistent with its right to receive third-party supply under this chapter which the commission shall adopt if it determines its provisions are just and reasonable.

    (B) The commission shall not regulate any contract entered into between a third-party electric supplier and an eligible customer.

 

SECTION 2.  This act takes effect upon approval by the Governor.

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