In the case of a public utility subject to the jurisdiction of the Public Service Commission, upon the determination by the Commission that a water supply enhancement project identified as necessary to assure adequate supply in a report of the Water Supply Coordinating Council has been placed into service by the utility and is used and useful in the provision of public utility service, the public utility shall be entitled to recover, in its rates, its reasonable and prudently incurred capital and ongoing operating costs for such project. Nothing in this section shall preclude the Commission from authorizing an allowance for funds used during construction for any such identified enhancement project.