Senate Bill sb2050
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Florida Senate - 2007 SB 2050
By Senator Posey
24-1574A-07
1 A bill to be entitled
2 An act relating to underground electric
3 distribution facilities; creating s. 366.201,
4 F.S.; creating the "Reliable Electricity
5 Enhancement Act"; creating s. 366.202, F.S.;
6 providing legislative intent; creating s.
7 366.203, F.S.; providing that as of a specified
8 date placement of electric distribution
9 facilities underground is the industry standard
10 for new distribution facilities; providing an
11 exception; requiring public utilities to
12 aggressively promote and encourage the timely
13 and orderly conversion of existing overhead
14 distribution facilities to underground
15 facilities; creating s. 366.204, F.S.;
16 providing additional duties of a public
17 utility; requiring certain reports; providing a
18 penalty; creating s. 366.205, F.S.; requiring
19 the Public Service Commission to ensure that
20 only the minimum reasonable general and
21 indirect costs associated with underground
22 facilities are included as costs of the
23 underground facilities for any purpose;
24 creating 366.206, F.S.; encouraging the use of
25 rights-of-way for the location of underground
26 facilities; providing a rebuttable presumption
27 that rights-of-way are sufficient for the
28 location of underground facilities; providing
29 an exception; creating s. 366.208, F.S.;
30 encouraging competition in providing utility
31 construction services; amending s. 366.04,
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Florida Senate - 2007 SB 2050
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1 F.S.; declaring that the installation of
2 underground electric distribution facilities to
3 replace existing overhead facilities is in the
4 public interest in the state; providing an
5 effective date.
6
7 Be It Enacted by the Legislature of the State of Florida:
8
9 Section 1. Section 366.201, Florida Statutes, is
10 created to read:
11 366.201 Short title.--Sections 366.201-366.208 may be
12 cited as the "Reliable Electricity Enhancement Act."
13 Section 2. Section 366.202, Florida Statutes, is
14 created to read:
15 366.202 Legislative findings and intent.--
16 (1) The Legislature finds that:
17 (a) More than two-thirds of all new electric
18 distribution facilities currently being installed in this
19 state are being installed as underground facilities;
20 (b) More than one-third of all electric distribution
21 facilities currently in service in this state are underground
22 facilities, and that approximately one-half of all customers
23 served by public utilities are served from underground
24 facilities;
25 (c) Underground distribution service is the preferred
26 standard of service in this state and that underground service
27 is, in fact, becoming the general standard of service for
28 public utilities;
29 (d) Many reports indicate that areas served by
30 underground distribution facilities had less severe and less
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1 prolonged losses of electric service during the hurricanes
2 that struck the state in 2004 and 2005; and
3 (e) A significant number of meteorological experts are
4 predicting that more hurricanes are likely to strike the state
5 with significantly greater frequency over the foreseeable
6 future than the state experienced in the 50-year period before
7 2004.
8 (2) The Legislature further finds that reliability of
9 electric service is critical to the public health, safety, and
10 welfare of the residents of the state, and that minimizing the
11 severity, extent, and duration of outages of electric service
12 is likewise critical to the health, safety, and welfare.
13 Accordingly, the Legislature directs the Public Service
14 Commission and the public utilities that provide service in
15 this state to consistently and continuously seek, promote, and
16 encourage all reasonable means of enhancing and maximizing the
17 reliability of the electric supply system, including
18 distribution systems as well as transmission and generation
19 systems. Further, the Legislature directs the commission and
20 all public utilities to aggressively promote and encourage the
21 installation of underground distribution facilities to the
22 maximum extent feasible, and to aggressively promote and
23 encourage the timely and orderly conversion of existing
24 overhead facilities to underground facilities.
25 (3) The mandatory provisions of ss. 366.201-366.208
26 apply only to public utilities as defined in s. 366.02.
27 Municipal and cooperative utilities providing electric service
28 in the state are encouraged to seek and implement all
29 reasonable means of enhancing electric service reliability in
30 the state, and to install underground electric distribution
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1 facilities to the maximum extent feasible, giving due
2 consideration to the unique circumstances of each utility.
3 Section 3. Section 366.203, Florida Statutes, is
4 created to read:
5 366.203 Standard of service.--
6 (1) Effective January 1, 2008, underground electric
7 distribution is presumed to constitute the standard for new
8 electric distribution service in this state. This presumption
9 is rebuttable in specific cases if, in proceedings before the
10 commission, a clear and convincing showing is made that, in a
11 particular application, underground electric distribution is
12 less desirable than overhead facilities. To rebut the
13 presumption, the commission must consider the relevant
14 factors, including the relative reliability of underground
15 compared to overhead systems in the particular application,
16 the installation costs for underground and overhead
17 facilities, the operating and maintenance costs for overhead
18 and underground facilities, and any other identifiable costs
19 associated with overhead and underground facilities. The
20 commission must also consider, without limitation:
21 (a) The overall cost of accidental electrocutions and
22 temporary and permanent disabilities to utility employees and
23 the public;
24 (b) The overall cost of vehicular accidents involving
25 distribution facilities;
26 (c) Ascertainable and measurable costs of adverse
27 health effects;
28 (d) The costs associated with rights-of-way and
29 easements;
30 (e) The total operating and maintenance costs,
31 including costs of tree trimming for overhead facilities;
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1 (f) The total costs incurred and losses sustained by
2 utility customers as a result of outages due to storm damage;
3 and
4 (g) The costs of associated insurance, attorney's
5 fees, and legal settlements and costs.
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7 In any proceedings before the commission, the commission shall
8 specifically include, as an estimated cost of the overhead
9 facilities being considered, the costs of having to remove and
10 replace a new overhead system due to storm damage at least
11 once during its projected useful life.
12 (2) Effective July 1, 2008, all public utilities are
13 directed to aggressively seek, promote, and encourage the
14 timely and orderly conversion of existing overhead
15 distribution facilities to underground facilities, so that the
16 majority of persons served by public utilities will come to
17 enjoy the reliability benefits of underground distribution
18 service. Specifically, it is the intent of the Legislature
19 that, to the maximum extent feasible, existing overhead
20 facilities be converted to underground systems in a timely and
21 orderly way, with preference and priority given to overhead
22 facilities and systems that are being relocated due to
23 road-widening or other similar activities, and to overhead
24 systems that are at or near the end of their useful lives.
25 (3) The commission shall adopt rules to encourage and
26 promote, to the maximum extent feasible, the conversion of
27 existing overhead systems to underground facilities in a
28 timely and orderly manner giving due consideration to the
29 factors deemed relevant by the commission and consistent with
30 the public interest, including:
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1 (a) The overall cost of accidental electrocutions and
2 temporary and permanent disabilities to both utility employees
3 and others;
4 (b) The overall cost of vehicular accidents involving
5 distribution facilities;
6 (c) Ascertainable and measurable costs of adverse
7 health effects;
8 (d) The costs associated with rights-of-way and
9 easements;
10 (e) The total operating and maintenance costs,
11 including, without limitation, costs of tree trimming for
12 overhead facilities;
13 (f) The total costs incurred and losses sustained by
14 utility customers as a result of outages due to storm damage;
15 and
16 (g) The costs of associated insurance, attorney's
17 fees, and legal settlements and costs.
18 Section 4. Section 366.204, Florida Statutes, is
19 created to read:
20 366.204 Duties of public utilities.--
21 (1) In addition to the general duties set forth in s.
22 366.03, each public utility shall:
23 (a) Maintain adequate and accurate records and data
24 regarding the relative reliability of overhead and underground
25 facilities, including the number, frequency, and duration of
26 all outages on the distribution system; whether each outage
27 was the result of an event directly affecting overhead or
28 underground facilities; and any other information that the
29 commission may prescribe by rule to be maintained.
30 (b) At least once every 2 years, prepare a
31 comprehensive and detailed report concerning the relative
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1 reliability of overhead and underground systems, including
2 summaries of the number, frequency, and duration of all
3 outages on the distribution system and the causes of the
4 outages; whether the outages resulted from events directly
5 affecting overhead or underground facilities; and any other
6 information that the commission may prescribe by rule as
7 appropriate for inclusion in the reports.
8 (c) Maintain accurate records regarding the costs of
9 installing, maintaining, and operating overhead and
10 underground systems and facilities, such that the original
11 cost, approximate depreciated value, and operating and
12 maintenance costs of underground and overhead facilities, and
13 also the removal cost of overhead facilities, can be readily
14 compiled and calculated separately and comparably for overhead
15 and underground facilities.
16 (d) Timely prepare and provide, at the request of any
17 local governmental unit, a report concerning the relative
18 reliability of the electric distribution systems providing
19 service within the geographic jurisdiction of the governmental
20 unit, at no cost to the governmental unit.
21 (e) Timely prepare and provide, at the request of any
22 local governmental unit, a report showing in reasonable and
23 understandable detail the estimated original cost, approximate
24 depreciated value, and operating and maintenance costs of
25 underground and overhead facilities, and also the removal cost
26 of overhead facilities, at no cost to the governmental unit.
27 (f) Work cooperatively, proactively, promptly,
28 diligently, and in good faith with any local governmental unit
29 or homeowners' association that wishes to participate in
30 converting existing overhead systems to underground
31 facilities.
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1 (2) By January 1, 2009, each public utility shall
2 prepare a detailed report regarding:
3 (a) The damage to overhead and underground facilities
4 on each public utility's distribution system caused by the
5 hurricanes that struck the state in 2004 and 2005, in order
6 that the extent and cost of damage to overhead and underground
7 facilities can be readily and fairly compared; and
8 (b) The outages sustained by each public utility's
9 customers due to damage to the utility's distribution systems
10 caused by the hurricanes that struck the state in 2004 and
11 2005, in order that the causes of the outages, the points on
12 the distribution system at which the outages originated, and
13 the duration of the outages can be readily and fairly compared
14 as between overhead and underground facilities.
15 (3) A public utility may not willfully discourage or
16 fail to seek, promote, and encourage the installation of new
17 underground utility facilities or the conversion of existing
18 overhead systems to underground systems. Any public utility
19 that violates this subsection is subject to the penalties set
20 forth in s. 350.127.
21 Section 5. Section 366.205, Florida Statutes, is
22 created to read:
23 366.205 Limitation on inclusion of general and
24 indirect costs in determining costs or payments for
25 underground facilities.--In any proceedings in which the cost
26 of, or payment for, underground facilities is at issue, the
27 commission shall ensure that only the minimum reasonable
28 general and indirect costs associated with underground
29 facilities, whether such facilities are contemplated or have
30 been installed, are included as costs of the underground
31 facilities for any purpose. This section shall be strictly
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1 construed to ensure that no general or indirect costs are
2 assigned or allocated to underground facilities, or accounted
3 for in such a way as to provide a disincentive to the
4 installation of underground facilities, unless the general or
5 indirect costs are properly attributable to the costs of
6 underground facilities.
7 Section 6. Section 366.206, Florida Statutes, is
8 created to read:
9 366.206 Rights-of-way; easements.--
10 (1) The use of rights-of-way for the location of
11 underground facilities is encouraged to the maximum extent
12 feasible, consistent with safety and cost considerations. It
13 is presumed, subject to a rebuttal by clear and convincing
14 evidence in a specific proceeding before the commission, that
15 rights-of-way are sufficient for the location of underground
16 facilities. If a municipality, county, special district, or
17 other governmental entity agrees to be responsible for the
18 costs associated with a future relocation of facilities
19 located within the governmental entity's rights-of-way, the
20 issue of future relocation costs to the public utility is
21 irrelevant when determining whether the governmental entity's
22 right-of-way is sufficient for the location of underground
23 facilities or if an easement is required for the facilities.
24 (2) All easements granted to public utilities on or
25 after July 1, 2008, must state that all permanent rights
26 granted by the easement vest in the governmental entity in
27 whose geographic jurisdiction the easement exists, with the
28 public utility having the rights that are granted by the
29 easement only for so long as it holds a franchise to provide
30 service within the governmental entity's jurisdiction. Each
31 easement must provide specifically that the easement, and the
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1 rights thereunder, transfer automatically, by operation of the
2 provisions of the easement itself, to the respective
3 governmental entity upon termination or expiration of any
4 franchise granted to the public utility, or upon the
5 governmental entity's establishing an electric utility system
6 to serve within any part, or all, of its geographic
7 jurisdiction.
8 Section 7. Section 366.208, Florida Statutes, is
9 created to read:
10 366.208 Encouraging competition in providing utility
11 construction services.--It is the policy of the state to
12 promote, to the maximum extent feasible and practicable,
13 competition in all economic activity in the state, including
14 the provision of utility construction services. Public
15 utilities shall pursue competitive alternatives from qualified
16 vendors and make such alternatives available to governmental
17 entities that desire to convert existing overhead facilities
18 to underground facilities.
19 Section 8. Paragraph (e) of subsection (2) of section
20 366.04, Florida Statutes, is amended to read:
21 366.04 Jurisdiction of commission.--
22 (2) In the exercise of its jurisdiction, the
23 commission shall have power over electric utilities for the
24 following purposes:
25 (e) To resolve, upon petition of a utility or on its
26 own motion, any territorial dispute involving service areas
27 between and among rural electric cooperatives, municipal
28 electric utilities, and other electric utilities under its
29 jurisdiction. In resolving territorial disputes, the
30 commission may consider, but not be limited to consideration
31 of, the ability of the utilities to expand services within
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1 their own capabilities and the nature of the area involved,
2 including population, the degree of urbanization of the area,
3 its proximity to other urban areas, and the present and
4 reasonably foreseeable future requirements of the area for
5 other utility services. The Legislature finds and declares
6 that the installation of underground electric distribution
7 facilities to replace existing overhead facilities is in the
8 public interest and that such installation is not a
9 duplication of existing overhead facilities. Any governmental
10 entity that installs underground electric distribution
11 facilities to provide service within its geographic
12 jurisdiction, and subsequently, without violating any
13 then-effective franchise agreement, establishes a
14 governmentally-owned electric utility system and begins
15 operating such system, is not subject to the jurisdiction of
16 the commission over territorial disputes.
17 Section 9. This act shall take effect July 1, 2007.
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20 SENATE SUMMARY
21 Creates the "Florida Reliable Electricity Enhancement
Act." Provides that, as of a specified date, placement of
22 electric distribution facilities underground is the
industry standard for new distribution facilities.
23 Requires public utilities to aggressively promote and
encourage the timely and orderly conversion of existing
24 overhead distribution facilities to underground
facilities. Details the general duties of a public
25 utility. Requires the Public Service Commission to ensure
that only the minimum reasonable general and indirect
26 costs associated with underground facilities are included
as costs of the underground facilities for any purpose.
27 (See bill for details.)
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