61-1503. ENERGY COST RECOVERY BONDS. An electric or gas public utility may apply to the commission for an energy cost financing order requesting that certain energy cost amounts be recovered through the sale of energy cost recovery bonds.
(1) A public utility may apply to the commission at any time and from time to time for an authorization that it may recover ECA amounts and other energy cost amounts through the issuance of energy cost recovery bonds. The public utility may apply to the commission for such an authorization either in a separate proceeding or in a proceeding considering the authorization of an ECA. Upon such an application, if the commission finds that the public interest would be better served if the energy cost amounts were recovered through the issuance of energy cost recovery bonds over the term of such bonds than if the ECA amounts were recovered over a period of one (1) year, assuming a conventional financing of such amounts, the commission shall issue an energy cost financing order to allow the public utility to recover energy cost amounts.
(2) The energy cost financing order shall detail the energy cost amount to be recovered and the period of time in which the energy cost recovery is to occur. The commission shall not issue an energy cost financing order unless the total of the then (a) existing ECAs, (b) existing energy cost bond charges, and (c) the amount identified by the electric or gas public utility in its application for such financing order as the additional ECA that would be required absent an issuance of energy cost recovery bonds pursuant to such financing order, exceeds a minimum amount (expressed in cents per kilowatt-hour or cents per therm) approved by the commission and in effect at the time of the issuance of such energy cost financing order. Each public utility shall, at least thirty (30) days prior to its first application for an energy cost financing order and at five (5) year intervals thereafter, file with the commission a proposal as to what such minimum amount should be and the commission shall, within twenty-eight (28) days of such filing, issue an order regarding its determination of such proposed minimum amount. Energy cost recovery bonds shall have an expected maturity date no later than five (5) years after the date of issuance, and scheduled principal payments on such bonds shall, to the extent practicable, be scheduled to be made in approximately equal amounts during each year of the term of such bonds. Energy cost recovery bonds shall have a legal maturity date no later than seven (7) years after the date of issuance. Energy cost bond charges shall remain in effect until all energy cost recovery bonds and all energy cost amounts have been paid in full. The commission may issue successive energy cost financing orders permitting subsequent issuances of energy cost recovery bonds.
(3) An energy cost financing order may be issued only upon the application of a public utility and shall become effective only in accordance with its terms and conditions. The public utility may withdraw its application if it disagrees with any of the terms and conditions of the energy cost financing order or any modification thereof within fourteen (14) days of issuance of the energy cost financing order or of such modification. The energy cost financing order shall specify the estimated amount of the energy cost bond charge and the formula for determining the amount of the charge that from time to time will be sufficient to recover all energy cost amounts.
(4) After issuance of an energy cost financing order, the public utility may sell, assign or otherwise transfer or pledge energy cost property or cause the energy cost recovery bonds to be issued, provided it may defer, postpone or refrain from effecting the sale, assignment, transfer, pledge or issuance, in which case no energy cost bond charge shall be imposed unless and until such energy cost recovery bonds are issued. If energy cost recovery bonds are not issued within one (1) year after the energy cost financing order becomes final and nonappealable, the authorization contained in the energy cost financing order shall expire, provided that a public utility may apply for an extension or renewal of an energy cost financing order.
(5) The energy cost financing orders, the energy cost amounts and the energy cost bond charges that have been determined by the commission shall be irrevocable and binding upon the commission. The commission shall not have authority either by rescinding, altering or amending the energy cost financing order or otherwise to, either directly or indirectly, revalue or revise for ratemaking purposes the energy cost amounts. Once the commission determines the energy cost bond charge, it cannot determine in a later proceeding that the energy cost bond charge is unjust or unreasonable or in any way reduce or impair the value of energy cost property either directly or indirectly by taking the energy cost bond charge into account when setting other rates for the public utility; nor shall the amount of revenues arising with respect thereto be subject to reduction, impairment, postponement or termination. The state of Idaho does hereby pledge to and agree with the owners of energy cost property and with any energy cost recovery bondholders that neither the state nor any of its agencies, including the commission, shall (by legislative action, ballot initiative or other similar process) limit, alter, restrict or impair the energy cost amounts, the energy cost bond charge, the energy cost property, the energy cost financing orders or any rights thereunder or ownership thereof or security interest therein or in any way impair the rights or remedies of any energy cost recovery bondholders until the energy cost recovery bonds, including all principal, interest, premium, costs, expenses and arrearages thereon, are fully met and discharged, provided nothing contained in this chapter shall preclude such a limitation, alteration, restriction or impairment if and when adequate provision (including without limitation provision for the payment of principal and interest when due) shall be made by law for the protection of the energy cost recovery bondholders. The state of Idaho does hereby acknowledge that any energy cost recovery bondholders may and will rely on this pledge and agreement and that they would be irreparably harmed by any such limitation, alteration, restriction or impairment without such adequate provision. The public utility and any assignee or other issuer are authorized to include this pledge and agreement in the energy cost recovery bonds and the documents relating thereto. Notwithstanding any other provision of this subsection, the commission shall approve such adjustments to the energy cost bond charges as may be necessary to ensure timely recovery of all energy cost amounts that are the subject of the pertinent energy cost financing order.
(6) Energy cost recovery bonds issued under this chapter and any energy cost financing orders do not constitute a debt or liability of the state or of any political subdivision thereof and do not constitute a pledge of the full faith and credit of the state or any of its political subdivisions, but are payable solely from the funds provided therefor. All the bonds shall contain on the face thereof a statement to the following effect: "Neither the full faith and credit nor the taxing power of the state of Idaho is pledged to the payment of the principal of, or interest on, this bond." This paragraph shall in no way preclude bond guarantees or enhancements pursuant to this chapter, nor shall it preclude the payment of compensation for any breach of the state’s pledge contained in subsection (5) of this section or for any action or failure to act by the commission in contravention of this chapter.
(7) The commission shall establish procedures for the expeditious processing of any application for energy cost financing orders, including the approval or disapproval of any such orders within forty-five (45) days of the application. In addition, each energy cost financing order shall specify a procedure for making adjustments to the energy cost bond charge that is the subject of the order, such adjustments to be expeditiously approved by the commission, so as to ensure the timely payment of principal and interest on the related energy cost recovery bonds and the recovery of all other energy cost amounts. Such procedure shall provide for adjustments to be made, upon application by the affected public utility, assignee or other issuer, at least annually and at such additional intervals, if any, as are specified in the order. The public utility, assignee or other issuer shall file its application for any such adjustment with the commission at least thirty (30) days before the date on which the adjustment is requested to become effective, and the commission shall approve or disapprove such application no later than thirty (30) days after the date of such filing. In addition, upon application by a public utility, assignee or other issuer after an energy cost financing order has been issued and has become effective, the commission may:
(a) Authorize the making of adjustments to the energy cost bond charge at more frequent intervals than those specified in such order; and/or
(b) Authorize a change in the method for calculating the energy cost bond charge from that specified in such order so as to better ensure the timely recovery of all energy cost amounts.
(8) The energy cost bond charge shall be treated as a charge for utility services for purposes of determining both the credit and collection standards to which customers (including, for purposes of this subsection, any parties that provide billing or collection services for energy supplied to another customer) may be held subject under applicable state law and the remedies for nonpayment that are available to a public utility under applicable state law, and such treatment shall not alter the tax, accounting or other intended characteristics of any energy cost bond financing.
(9) An energy cost bond charge shall constitute energy cost property when, and to the extent that, an energy cost financing order authorizing such energy cost bond charge has become effective in accordance with this chapter, and the energy cost property shall thereafter continuously exist as property for all purposes with all of the rights and privileges of this chapter for the period and to the extent provided in the energy cost financing order, but in any event until the energy cost recovery bonds are paid in full, including all principal, interest, premium, costs and arrearages thereon.
(10) Any surplus energy cost bond charge collections in excess of the amounts necessary to pay principal, premium, if any, interest, credit enhancement and all other fees, costs and charges with respect to energy cost recovery bonds shall be used to benefit customers in such manner as the commission may reasonably determine except to the extent that such use would result in a recharacterization of the tax, accounting or other intended characteristics of the financing.
History:
[61-1503, added 2001, ch. 380, sec. 1, p. 1328.]