T61CH15
Title 61 > T61CH15
Sections (8)
61-1501
TITLE 61 PUBLIC UTILITY REGULATION CHAPTER 15 ENERGY COST RECOVERY BONDS 61-1501. Legislative intent. It is the intent of the legislature in enacting this chapter to provide a process by which the recovery of large energy rate increases caused by fuel or power cost adjustments, purchased gas adjustment tracker rates, commodity tracker rate adjustments or purchased power tracker rates will be facilitated by the issuance of bonds. This legislation will provide electric and gas utilities with a mechanism for recovery of their increased costs while leveling the rate impact of such increase on the utilities’ customers. The legislature believes that this type of securities legislation is in the public interest but should not be considered as an endorsement of, or intended to provide, a mechanism for restructuring of the utility industry in the state of Idaho. History: [61-1501, added 2001, ch. 380, sec. 1, p. 1326.]
61-1502
TITLE 61 PUBLIC UTILITY REGULATION CHAPTER 15 ENERGY COST RECOVERY BONDS 61-1502. Definitions. For purposes of this chapter, the following terms shall have the following meanings: (1) Assignee means any corporation, limited liability company, trust, partnership or other entity to which a public utility assigns, sells or transfers, other than as security, all or a portion of the public utility’s interest in or right to energy cost property. The term also includes any such entity to which an assignee assigns, sells or transfers, other than as security, the assignee’s interest in or right to energy cost property. (2) Chapter 9 means chapter 9, title 28 , Idaho Code, as from time to time amended, including any successor provisions. (3) Commission means the Idaho public utilities commission, as it may be constituted from time to time, and any successor agency exercising functions similar in purpose thereto. (4) ECA means any of the following, as authorized by the commission and reflected in a usage-based charge of a public utility: a fuel or power cost adjustment; a purchased gas adjustment tracker rate; a commodity electric or gas tracker rate adjustment; or a purchased power tracker rate. (5) Energy cost amounts means the amounts that a public utility, assignee or other issuer has been authorized to recover by the commission pursuant to an energy cost financing order, including without limitation: (a) Amounts recoverable by a public utility pursuant to an ECA; (b) Expenditures incurred to refinance or retire existing debt or existing equity capital of the public utility through the issuance of energy cost recovery bonds and any costs related thereto; (c) Amounts necessary to recover federal or state taxes actually paid by a public utility, which tax liability is modified by the transactions approved in an energy cost financing order issued by the commission pursuant to this chapter; and (d) Reasonable costs, as approved by the commission, relating to the issuance, servicing or refinancing of energy cost recovery bonds under the provisions of this chapter including, without limitation, principal and interest payments and accruals, sinking fund payments, debt service and other reserves, costs of credit enhancement, indemnities, if any, owed to an assignee or other issuer or the trustee for the energy cost recovery bonds, issuance costs and redemption premiums, if any, and all other reasonable fees, costs and charges with respect to the energy cost recovery bonds. (6) Energy cost bond charge means a nonbypassable usage-based charge that the commission authorizes in an energy cost financing order as a separate line item for recovery on a public utility’s bill to all of its customers, whether such amounts are billed and/or collected by the public utility, any subsidiary or affiliate thereof, or any third party that may assume the responsibility for billing or collecting such charges. (7) Energy cost financing order means an order of the commission issued
61-1503
TITLE 61 PUBLIC UTILITY REGULATION CHAPTER 15 ENERGY COST RECOVERY BONDS 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 b
61-1504
TITLE 61 PUBLIC UTILITY REGULATION CHAPTER 15 ENERGY COST RECOVERY BONDS 61-1504. Procedure for issuance of bonds. (1) Public utilities, assignees or other issuers may issue energy cost recovery bonds upon approval by the commission in an energy cost financing order. (2) Public utilities and assignees may sell and assign all or portions of their interest in energy cost property. Public utilities and assignees may sell or assign their interests to one (1) or more assignees or other issuers that make that property the basis for issuance of energy cost recovery bonds to the extent approved in the pertinent energy cost financing order. To the extent approved in the pertinent energy cost financing orders, public utilities and assignees may also pledge energy cost property as collateral, directly or indirectly, for energy cost recovery bonds providing for a security interest in the energy cost property, in the manner as set forth in section 61-1505 , Idaho Code. Energy cost property may be sold or assigned by: (a) The public utility, assignee or other issuer or a trustee for the holders of energy cost recovery bonds in connection with the exercise of remedies upon a default; or (b) Any person acquiring the energy cost property after a sale or assignment pursuant to this subsection. (3) To the extent that any interest in energy cost property is so sold or assigned, or is so pledged as collateral, the commission shall authorize the public utility to contract with an assignee or other issuer that it will continue to operate its system to provide service to its customers, will collect amounts with respect to the energy cost bond charges for the benefit and account of the assignee or other issuer, and will account for and remit these amounts to or for the account of the assignee or other issuer. Contracting with the assignee or other issuer in accordance with that authorization shall not impair or negate the characterization of the sale, assignment or pledge as an absolute transfer, a true sale or security interest, as applicable. (4) Notwithstanding any other provision of law to the contrary, any requirement under this chapter or an energy cost financing order that the commission take action with respect to the subject matter of an energy cost financing order shall be binding upon the commission, as it may be constituted from time to time, and any successor agency exercising functions similar to the commission. The commission shall have no authority to rescind, alter or amend any such requirement under this chapter or an energy cost financing order; provided however, that nothing in this subsection shall preclude adjustments of the energy cost bond charges in accordance with the provisions of section 61-1503 , Idaho Code. The issuance of energy cost recovery bonds, any related transfer or pledge of energy cost recovery property and any other transactions incidental to such issuance shall be exempt from the provisions of sections 61-901 through 61-908 , Ida
61-1505
TITLE 61 PUBLIC UTILITY REGULATION CHAPTER 15 ENERGY COST RECOVERY BONDS 61-1505. Security interest. (1) To the extent the provisions of this section conflict with chapter 9 as from time to time in effect, including any successor provisions, this section shall apply. (2) A security interest in energy cost property is valid, is enforceable against the pledgor and third parties, subject to the rights of any third parties holding security interests in the energy cost property perfected in the manner described in this section, and attaches when all of the following have occurred: (a) The commission has issued an energy cost financing order authorizing the energy cost bond charges, the right to the imposition and collection of which is included in the energy cost property; (b) Value has been given by the pledgees of the energy cost property; and (c) The pledgor has signed a security agreement covering the energy cost property. (3) A valid and enforceable security interest in energy cost property is perfected when it has attached and when a financing statement has been filed in accordance with chapter 9, naming the pledgor of the energy cost property as debtor and identifying the energy cost property. Any description of the energy cost property shall be sufficient if it refers to the energy cost financing order creating the energy cost property. A copy of the financing statement shall be filed with the commission by the pledgor or transferor of the energy cost property, and the commission may require the pledgor or transferor to make other filings with respect to the security interest in accordance with procedures it may establish, provided that the filings shall not affect the perfection of the security interest. A financing statement filed pursuant to this section shall remain effective until a termination statement is filed. (4) A perfected security interest in energy cost property is a continuously perfected security interest in all revenues and proceeds arising with respect thereto, whether or not the revenues or proceeds have accrued. Conflicting security interests shall rank according to priority in time of perfection. Energy cost property shall constitute property for all purposes, including for contracts securing energy cost recovery bonds, whether or not the revenues and proceeds arising with respect thereto have accrued. (5) Subject to the terms of the security agreement covering the energy cost property and the rights of any third parties holding security interests in the energy cost property perfected in the manner described in this section, the validity and relative priority of a security interest created under this section is not defeated or adversely affected by the commingling of revenues arising with respect to the energy cost property with other funds of the public utility that is the pledgor or transferor of the energy cost property, or by any security interest in a deposit account of that public utility perfected under chapter 9, i
61-1506
TITLE 61 PUBLIC UTILITY REGULATION CHAPTER 15 ENERGY COST RECOVERY BONDS 61-1506. Transfers in interest. (1) A transfer of energy cost property by a public utility to an assignee, or by an assignee to another assignee, that the parties have in the governing documentation expressly stated to be a sale or other absolute transfer, in a transaction approved in an energy cost financing order, shall be treated as an absolute transfer of all of the transferor’s right, title and interest, as in a true sale, and not as a pledge or other financing, of the energy cost property in each case notwithstanding any contrary treatment for federal and state income and franchise taxes, accounting or other purposes. (2) A transfer of energy cost property shall be deemed perfected as against third persons and shall vest title in the transferee when both of the following have taken place: (a) The commission has issued the energy cost financing order authorizing the energy cost bond charges included in the energy cost property. (b) An assignment of the energy cost property in writing has been executed and delivered to the transferee. (3) As between bona fide assignees of the same right for value without notice, the assignee first filing a financing statement in accordance with chapter 9, naming the assignor of the energy cost property as debtor and identifying the energy cost property has priority. Any description of the energy cost property shall be sufficient if it refers to the energy cost financing order creating the energy cost property. A copy of the financing statement shall be filed by the assignee with the commission, and the commission may require the assignor or the assignee to make other filings with respect to the transfer in accordance with procedures it may establish, but these filings shall not affect the perfection of the transfer. (4) The interest of an assignee or pledgee in energy cost property and in the revenues and collections arising from such property are not subject to set-off, counterclaim, surcharge or defense by the public utility or any other person or in connection with the bankruptcy of the public utility or any other person. History: [61-1506, added 2001, ch. 380, sec. 1, p. 1335.]
61-1507
TITLE 61 PUBLIC UTILITY REGULATION CHAPTER 15 ENERGY COST RECOVERY BONDS 61-1507. Successors. Any successor to the public utility, whether pursuant to any bankruptcy, reorganization or other insolvency proceeding, or pursuant to any merger, sale or transfer, by operation of law or otherwise, shall perform and satisfy all obligations of the public utility pursuant to this chapter in the same manner and to the same extent as was required of the public utility before such proceeding or merger, sale or transfer including, but not limited to, billing, collecting and paying to the energy cost recovery bondholders or their representatives or the applicable financing entity energy cost recovery charges and any other revenues arising with respect to the energy cost property sold to the applicable financing entity or pledged to secure energy cost recovery bonds and seeking energy cost bond charge adjustments, as necessary and permitted by the pertinent energy cost financing order, to recover all energy cost amounts designated in such energy cost financing order. History: [61-1507, added 2001, ch. 380, sec. 1, p. 1335.]
61-1508
TITLE 61 PUBLIC UTILITY REGULATION CHAPTER 15 ENERGY COST RECOVERY BONDS 61-1508. Severability. If any provision of this chapter is held to be invalid or is invalidated, superseded, replaced or repealed, or expires for any reason, that occurrence does not affect the validity or continuation of this chapter or any other provision of this title that is relevant to the issuance, administration, payment, retirement or refunding of energy cost recovery bonds or to any actions of the public utility, its successors, an assignee or other issuer or a collection agent, which shall remain in full force and effect. History: [61-1508, added 2001, ch. 380, sec. 1, p. 1335.]