The Capital Recovery for Clean Energy Generating Plants Act Exposed

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The Capital Recovery for Clean Energy Generating Plants Act was considered by ALEC's Energy, Environment and Agriculture Task Force at the 2010 States and Nation Policy Summit on December 2, 2010. This bill was part of the ALEC task force agenda between 2010 and 2012, but due to incomplete information, it is not known if the bill passed in a vote by legislators and lobbyists at ALEC task force meetings, if ALEC sought to distance itself from the bill as the public increased scrutiny of its pay-to-play activities, or if key operative language from the bill has been introduced by an ALEC legislator in a state legislature in the ensuing period or became binding law.

ALEC Draft Bill Text

Summary:

The purpose of of this legislation is to provide for the recovery of prudently incurred costs associated with new clean energy generation facilities, while at the same time protecting customers of investor-owned electric utilities from responsibility for imprudent financial obligations or costs. The legislation defines clean energy generating facility as any new electric generating station designed to avoid, reduce, or sequester air pollutants or anthropogenic emissions of greenhouse gases, including but not limited to nuclear energy, wind energy, solar energy, biomass and geothermal energy.

The legislation authorizes a state public service commission to approve development and construction of a new clean energy generating plant in two distinct steps:

  • On application by a company, a public service commission may issue a clean energy project development order, which establishes the prudence of a utility’s decision to incur preconstruction costs associated with a clean energy plant. A clean energy project development order allows a utility to recover all preconstruction costs, absent a specific finding of imprudence.
  • On application by a company, a public service commission may issue a clean energy project construction order, which establishes that, if a plant is constructed in accordance with an approved construction schedule, approved capital cost estimates, and approved projections of in-service expenses, the plant is considered to be used and useful for utility purposes such that its capital costs are prudent utility costs and can be included in rates. During construction, the company may recover through revised rates its weighted average cost of capital applied to construction work in progress.

If the company decides to abandon a project after issuance of a clean energy project development order or a clean energy project construction order, preconstruction costs and capital costs related to that project may be recovered, although the utility will bear the burden of proving that the decision to abandon the plant was prudent. Recovery of capital costs and the utility’s cost of capital associated with them may be disallowed only to the extent that the failure by the utility to anticipate or avoid the allegedly imprudent costs was imprudent, considering the information available to the utility at the time.

The legislation includes substantial protections for consumers, including provisions for the Office of Regulatory Staff to review and audit revised rates and the information supporting them, and propose changes for the commission’s consideration.


THE CAPITAL RECOVERY FOR CLEAN ENERGY GENERATING PLANTS ACT

Section I. Purpose and findings

A) The purpose of of this Act is to provide for the recovery of the prudently incurred costs associated with new clean energy generation plants when constructed by investor-owned electrical utilities, while at the same time protecting customers of investor-owned electrical utilities from responsibility for imprudent financial obligations or costs. The Legislature finds that it is the policy of the State to:

1. Promote and foster the prudent construction of clean energy generating capacity by electric utilities;
2. Take advantage of advances in clean energy technology to avoid or reduce regulated air emissions, including sulfur dioxide, nitrogen oxides and carbon dioxide;
3. Protect the economic interests of the ratepayers of the State by providing stable and predictable rates associated with construction of electric generating facilities employing clean energy technology, through a predetermination of need as indicated by the utility’s integrated resource planning process and prudence, and assurance of recovery of pre-construction and construction costs for those facilities.

Section II. Definitions

A) The following terms, when used in this Act, shall have the following definitions, unless another meaning is clearly apparent from the context:

1. “AFUDC” means the allowance for funds used during construction of a plant calculated according to regulatory accounting principles.
2. “Clean energy generating plant,” “plant,” “clean energy generating facility,” or “facility” means a new electric generating station that will use electric generation technology designed to avoid, reduce, or sequester air pollutants or anthropogenic emissions of greenhouse gases, including but not limited to nuclear energy, wind energy, solar energy, biomass and geothermal energy.
3. “Clean energy project construction application” or “application” means an application for the construction of a clean energy generation plant under the terms of this Act.
4. “Clean energy project construction order” means an order issued by the Public Service Commission establishing that, if a plant is constructed in accordance with an approved construction schedule, approved capital cost estimates, and approved projections of in-service expenses, as defined herein, the plant is considered to be used and useful for utility purposes such that its capital costs are prudent utility costs and are properly included in rates.
5. “Capital costs” or “plant capital costs” means costs associated with the design, siting, selection, acquisition, licensing, construction, testing, and placing into service of a clean energy generating plant, and capital costs incurred to expand or upgrade the transmission grid in order to connect the plant to the transmission grid, and includes costs that may be properly considered capital costs associated with a plant under generally accepted principles of regulatory or financial accounting, and specifically includes AFUDC associated with a plant and capital costs associated with facilities, project contingency reserves or investments for the transportation, delivery, storage, and handling of fuel.
6. “Commission” means the state Public Service Commission.
7. “Construction work in progress” means capital costs as defined above associated with a clean energy generating plant which have been incurred but have not been included in the utility’s plant-in-service.
8. “General rate proceeding” means a rate case proceeding and other applicable provisions for the establishment of new electric rates and charges, and where orders in general rate proceedings are referenced in this Act, these orders include rate orders issued in proceedings under this Act.
9. “In-service expenses” means reasonably projected expenses recognized under generally accepted principles of regulatory and financial accounting as a result of a clean energy generating plant commencing commercial operation, including:
a. expenses associated with operating and maintaining a plant, as well as taxes and governmental charges applicable to the plant, including taxes other than income taxes;
b. depreciation and amortization expenses related to the plant;
c. revenue requirements related to the utility’s cost of capital applied to the investment in supplies, inventories, and working capital associated with the plant; and
d. other costs determined by the commission to be appropriate for ratemaking purposes. In-service expenses include, but are not limited to, labor, supplies, insurance, general and administrative expenses, and the cost of outside services, but do not include costs recovered as fuel costs through other rate provisions.
10. “Person” means any individual, group, firm, partnership, or corporation.
11. “Preconstruction costs” means all costs associated with a potential plant incurred before issuance of a final state certificate including, without limitation, the costs of evaluation, design, engineering, environmental and geotechnical analysis and permitting, contracting, other required permitting including early site permitting and combined operating license permitting, initial site preparation costs and related consulting and professional costs, and use of project contingency reserves associated with these activities, and shall include AFUDC associated with those costs. For potential plants located in other states, the costs must be those incurred before issuance of a certificate by the host state under comparable statutes.
12. “Proceeding” means the proceeding to consider an application pursuant to this Act.
13. “Office of Regulatory Staff” is a state government entity responsible for auditing public utilities in the state and represents the public interest in matters before the Public Service Commission.
14. “Clean energy project development application” means an application for a clean energy project development order.
15. “Clean energy project development order” means an order establishing the prudence of a utility’s decision to incur preconstruction costs associated with a clean energy plant.
16. “Return on equity” means the return on common equity established in the clean energy project construction order for a plant. A project-specific return on equity set hereunder shall apply exclusively to the establishment of the weighted average cost of capital under this Act and shall not be used for reporting or any other purpose.
17. “Revised rates” means a revised schedule of electric rates and charges reflecting a change to the utility’s then current nonfuel rates and charges to add incremental revenue requirements related to a clean energy plant as authorized in this Act. For a plant under construction, until it enters commercial operation the rate adjustments related to the plant shall include recovery of the weighted average cost of capital applied to the outstanding balance of capital costs of that plant only and shall not include depreciation or other items constituting a return of capital to the utility. In lieu of revised rates, a rider may be used to streamline the ratemaking process and to provide additional certainty to the project developer.
18. “Revised rates order” means an order issued by the commission approving, modifying, or denying the utility’s request to charge revised rates under this Act, which revised rates order an aggrieved party may contest in an adversarial hearing before the commission.
19. “Revised rates proceedings” means all proceedings to consider an application for revised rates or review of a revised rates order.
20. “Utility” means a person owning or operating equipment or facilities for generating, transmitting, or delivering electricity to state retail customers for compensation but it shall not include a person furnishing electricity only to himself, itself, its residents, employees, or tenants when the electricity is not resold or used by others.
21. “Weighted average cost of capital” or “cost of capital” means the average cost of debt and equity capital for the project:
a. incorporating the allowed return on equity for the project;
b. incorporating the project’s weighted average cost of debt;
c. weighting (a) and (b) according to the project’s capital structure for ratemaking purposes, as established in the order and
d. adjusting the result for the effect of income taxes.

Section III. Clean Energy Project Development

A) The provisions of this Section apply to the preconstruction costs of a clean energy generating facility.

B) At any time before the filing of an application under this Act related to a specific plant, a utility may file a clean energy project development application with the commission.

C) In a clean energy project development application, the utility shall:

1. describe the plant being considered and shall designate:
a) the anticipated generation capacity (or range of capacity) of the plant; and
b) the projected annual capacity factors or range of factors of the
2. provide information establishing the need for the generation capacity represented by the potential plant and the need for generation assets with the indicative annual capacity factors of the potential plant;
3. provide information establishing the reasonableness and prudence of the potential fuel sources and potential generation types that the utility is considering for the plant; and
4. provide such other information as may be required to establish that the decision to incur preconstruction costs related to the potential plant is prudent (as indicated by the utility’s integrated resource plan) considering the information known to the utility at the time and considering the other alternatives available to the utility for supplying its generation needs.

D) The commission shall issue a clean energy project development order affirming the prudency of the utility’s decision to incur preconstruction costs for the plant specified in the application if the utility demonstrates by a preponderance of evidence that the decision to incur preconstruction costs for the plant is prudent. In issuing its clean energy project development order, the commission may not rule on the prudency or recoverability of specific items of cost, but shall rule instead on the prudency of the decision to incur preconstruction costs for the plant based on the utility’s integrated resource plan.

E) Unless the record in a subsequent proceeding shows that individual items of cost were imprudently incurred, or that other decisions subsequent to the issuance of a project development order were imprudently made considering the information available to the utility at the time they were made, then all the preconstruction costs incurred for the potential plant must be properly included in the utility’s plant-in-service and must be recoverable fully through rates in future proceedings under this Act.

F) To the extent that a party in a general rate proceeding or revised rates proceeding establishes the imprudence of specific items of cost or of specific decisions made subsequent to the issuance of a clean energy project development order, then the commission may disallow the resulting costs but only to the extent that a prudent utility would have avoided those costs considering the information available to the utility at the time when they were incurred or the decisions at issue were made.

G) If the utility decides to abandon the project after issuance of a prudency determination under this Section, then the preconstruction costs related to that project may be deferred, with AFUDC being calculated on the balance, and may be included in rates in the utility’s next general rate proceeding or revised rates proceeding, provided that as to the decision to abandon the plant, the utility shall bear the burden of proving by a preponderance of the evidence that the decision was prudent. Recovery of capital costs and the utility’s cost of capital associated with them may be disallowed only to the extent that the failure by the utility to anticipate or avoid the allegedly imprudent costs, or to minimize the magnitude of the costs, was imprudent considering the information available at the time that the utility could have acted to avoid or minimize the costs. Pending an order in the general rate proceeding or revised rates proceeding, the utility, at its discretion, may commence to amortize to cost of service the balance of the preconstruction costs related to the abandoned project over a period equal to the period during which the costs were incurred, or five years, whichever is greater.

H) Prudency determinations may not be challenged or reopened in any subsequent proceeding and other applicable provisions of this Act.

I) At any time after an initial clean energy project development order has been issued, a utility may file an amended clean energy project development application seeking a determination of the prudency of the utility’s decision to continue to incur preconstruction costs considering changed circumstances or changes in the type or location of the clean energy generating plant that the utility is pursuing or considering other characteristics or decisions related to the plant. The amended clean energy project development application must be considered in a separate docket; however, the testimony and other evidence of the prior docket must be considered to be part of the new docket.

J) The commission shall enter an order granting or denying a clean energy project development order or amended clean energy project development order within six months of the filing of the application. If the commission fails to issue an order within the period prescribed in this Section, a party may move that the commission issue an order granting or denying the application. If the commission fails to issue an order within ten days after the motion is served, the application will be considered granted.

Section IV. Office of Regulatory Staff

A) Any utility proposing to construct a plant, individually or jointly with other parties, may elect to come under the terms of this Act by filing an application with the commission, and by serving a copy of that application on the Office of Regulatory Staff.

B) An application may be combined with a general rate proceeding application at the utility’s option.

C) The Office of Regulatory Staff shall safeguard the public interest in all matters arising under this Act. It shall have full audit rights related to all matters arising under this Act and shall review the reasonableness and necessity of all costs to be recovered under this Act.

Section V. Proceedings

A) Except as otherwise specified in this Act, all procedural requirements that apply to general rate proceedings by law or regulation shall apply to proceedings, to revised rates proceedings, and to the judicial review of orders issued under this Act. The requirements related to the form and content of applications in general rate proceedings, however, only shall apply to proceedings which include an application for new electric rates.

B) In proceedings to review revised rates orders, no further notice to the public, customers, and others is required additional to that provided upon filing of the proceeding. In proceedings to review revised rates orders, the utility’s revised rates filing shall serve as the application and the utility must be considered to be the applicant.

C) In proceedings, the utility shall have the burden of proving that the decision to build the plant was prudent (as demonstrated by the results of the utility’s integrated resource planning process), and shall have the burden of proof as to all matters on which the commission is required to enter findings under Section VII of this Act. Without in any way limiting the conclusive effect of determinations under Sections III and VIII of this Act, in cases where this statute allows a party to challenge the prudency of any transaction, cost, or decision of the utility, that party shall be required to make a prima facie case establishing imprudence, and thereafter the burden of proof shall shift to the utility to demonstrate the prudence of the transaction cost or decision by a preponderance of the evidence.

D) When the proposed changes relate to rates or tariffs, the commission must rule and issue its order approving or disapproving the changes within nine months after the date the schedule is filed.

Section VI. Applications

A) The application for a clean energy project construction order under this Act shall include as a minimum:

1. information showing the anticipated construction schedule for the plant;
2. information showing the anticipated components of capital costs and the anticipated schedule for incurring them;
3. information showing the projected effect of investment in the plant on the utility’s overall revenue requirement for each year during the construction period;
4. information identifying:
a) the specific type of generating technology selected for the plant;
b) the suppliers of the major components of the plant; and
c) the basis for selecting the generating technology, major components, and suppliers;
5. information detailing the qualification and selection of principal contractors and suppliers, other than those listed in item (4)(c) above, for construction of the plant;
6. information showing the anticipated in-service expenses associated with the plant for the twelve months following commencement of commercial operation adjusted to normalize any atypical or abnormal expense levels anticipated during that period;
7. information required by Section II of this Act;
8. information identifying risk factors related to the construction and operation of the plant;
9. information identifying the proposed rate design and class allocation factors to be used in formulating revised rates;
10. information identifying the return on equity proposed by the utility pursuant to Section II; and
11. the revised rates, if any are requested, that the utility intends to put in place after issuance of the resulting clean energy project construction order.

Section VII. Clean Energy Project Construction Orders

A) After the hearing, the commission shall issue a clean energy project construction order approving rate recovery for plant capital costs if it determines that the utility’s decision to proceed with construction of the plant is prudent and reasonable considering the information available to the utility at the time.

B) The clean energy project construction order shall establish:

1. the anticipated construction schedule for the plant including contingencies;
2. the anticipated components of capital costs and the anticipated schedule for incurring them, including specified contingencies;
3. the return on equity established in conformity with Section II of this Act;
4. the choice of the specific technology and major components of the plant;
5. the qualification and selection of principal contractors and suppliers for construction of the plant; and
6. the inflation indices used by the utility for costs of plant construction, covering major cost components or groups of related cost components. Each utility shall provide its own indices, including: the source of the data for each index, if the source is external to the company, or the methodology for each index which is compiled from internal utility data, the method of computation of inflation from each index, a calculated overall weighted index for capital costs, and a five-year history of each index on an annual basis.

C) If revised rates are requested, the clean energy project construction order shall specify initial revised rates reflecting the utility’s current investment in the plant which must be determined using the standards set forth in Section X of this Act and implemented according to Section X of this Act.

D) The clean energy project construction order shall establish the rate design and class allocation factors to be used in calculating revised rates related to the plant.

E) As circumstances warrant, the utility may petition the commission, with notice to the Office of Regulatory Staff, for an order modifying any of the schedules, estimates, findings, class allocation factors, rate designs, or conditions that form part of any clean energy project construction order issued under this Section. The commission shall grant the relief requested if, after a hearing, the commission finds:

1. as to the changes in the schedules, estimates, findings, or conditions, that the evidence of record justifies a finding that the changes are not the result of imprudence on the part of the utility; and
2. as to the changes in the class allocation factors or rate designs, that the evidence of record indicates the proposed class allocation factors or rate designs are just and reasonable.

F) The commission shall consider a request under Section VII(e) of this Act in a new docket which, pursuant to Section V of this Act, must be subject to the requirement that the relief requested in this Act is considered granted if not denied by order within six months of the date of filing. If the commission fails to issue an order within the period prescribed in this Section, a party may move that the commission issue an order granting or denying the application. If the commission fails to issue an order within ten days after the motion is served, the application will be considered granted.

G) The commission promptly shall schedule a hearing to consider any settlement agreement entered into between the Office of Regulatory Staff, as the party representing the public interest in the proceedings, and the utility applicant, provided that all parties shall have been given a reasonable opportunity to conduct discovery in the docket by the time the hearing is held. The commission may accept the settlement agreement as disposing of the matter, and issue an order adopting its terms, if it determines that the terms of the settlement agreement comport with the terms of this Act.

Section VIII. Final Determinations

A) A clean energy project construction order shall constitute a final and binding determination that a plant is used and useful for utility purposes, and that its capital costs are prudent utility costs and expenses and are properly included in rates so long as the plant is constructed or is being constructed within the parameters of:

1. the approved construction schedule, including contingencies; and
2. the approved capital costs estimates, including specified contingencies.

B) Determinations under this Section may not be challenged or reopened in any subsequent proceeding, including general rate and tariff case proceedings and other applicable provisions, and Section X and other applicable provisions of this Act.

C) So long as the plant is constructed or being constructed in accordance with the approved schedules, estimates, and projections set forth in Section VII, as adjusted by the inflation indices set forth therein, the utility must be allowed to recover its capital costs related to the plant through revised rate filings or general rate proceedings.

D) Changes in fuel costs will not be considered in conducting any evaluation under this Section.

E) In cases where a party proves by a preponderance of the evidence that there has been a material and adverse deviation from the approved schedules, estimates, and projections set forth in Section VII, as adjusted by the inflation indices set forth therein, the commission may disallow the additional capital costs that result from the deviation, but only to the extent that the failure by the utility to anticipate or avoid the deviation, or to minimize the resulting expense, was imprudent considering the information available at the time that the utility could have acted to avoid the deviation or minimize its effect.

Section IX. Reports

A) After issuance of a clean energy project construction order approving rate recovery for capital costs related to the plant, the utility will file reports with the Office of Regulatory Staff quarterly until the plant begins commercial operation. These reports must be filed no later than forty-five (45) days after the close of a quarter, shall not be combined with any other filing, and shall contain the following information:

1. the progress of construction of the plant;
2. updated construction schedules;
3. schedules of the capital costs incurred including updates to the information required by Section VII;
4. updated schedules of the anticipated capital costs; and
5. other information as the Office of Regulatory Staff may require.

B) The Office of Regulatory Staff shall conduct on-going monitoring of the construction of the plant and expenditure of capital through review and audit of the quarterly reports under this Act, and shall have the right to inspect the books and records regarding the plant and the physical progress of construction upon reasonable notice to the utility.

Section X. Revising Rates

A) No earlier than one year after filing the application, and no more frequently than annually thereafter, the utility may file with the commission and serve on the Office of Regulatory Staff requests for the approval of revised rates subsequent to those approved in the clean energy project construction order.

B) A utility must be allowed to recover through revised rates its weighted average cost of capital applied to all or, at the utility’s option, part of the outstanding balance of construction work in progress, calculated as of a date specified in the filing. A utility must also be allowed to recover through revised rates the capital associated with all, or at the utility’s discretion, part of the outstanding balance of preconstruction capital costs that have been incurred prior to issuance of a final state certificate. Any construction work in progress or preconstruction capital costs not included in any specific filing for revised rates shall continue to earn AFUDC and may be included in rates through future filings. The revised rates filing shall include the most recent monitoring report filed under Section IX of this Act updated to reflect information current as of the date specified in the filing.

C) Written comments to the commission and the Office of Regulatory Staff concerning the revised rates and the information supporting them shall be allowed within one month of the revised rates filing.

D) The Office of Regulatory Staff shall review and audit the revised rates and the information supporting them to determine their compliance with the terms of this Act. No later than two months after the date of the revised rates filing, the Office of Regulatory Staff shall serve on the commission and all intervenors and parties of record a report indicating the results of its review and audit and proposing any changes to the revised rates or the information supporting them that the Office of Regulatory Staff determines to be necessary to comply with the terms of this Act.

E) Written comments related to the report may be filed with the commission within one month from the date of the filing of the report. Comments must be served on the Office of Regulatory Staff and simultaneously mailed or electronically transmitted to the utility and to all intervenors and parties of record who previously appeared and filed comments. The Office of Regulatory Staff may revise its report considering comments filed.

F) No later than four months after the date of the revised rates filing, the commission shall issue a revised rates order granting, modifying, or denying revised rates as filed by the utility. In the absence of such a revised rates order, the revised rates shall be considered to be approved as filed. If the commission fails to issue an order within the period prescribed in this Section, a party may move that the commission issue an order granting or denying the application. If the commission fails to issue an order within ten days after the motion is served, the application will be considered granted.

G) Where both Office of Regulatory Staff and the utility agree in writing on the revised rates to be implemented, the commission shall give substantial weight to the agreement in issuing its revised rates order.

H) If the utility is granted a rate increase in the revised rates order, the utility shall provide notice to its customers with the next billing. The utility may implement revised rates for bills rendered on or after a date selected by the utility, which may not be sooner than thirty days after revised rates are approved.

I) Upon implementation of revised rates under this Act, the utility will cease to accrue AFUDC on that component of its construction work in progress on which it is recovering its weighted average cost of capital through revised rates.

J) Other provisions of this Act notwithstanding:

1. The utility may file a final set of revised rates for a plant to go into effect upon commercial operation of the plant, the filing to be made no sooner than seven months before the projected date that the plant is to commence commercial operations. In the final revised rates the utility may include recovery of the weighted average cost of capital applied to all or part of the capital costs associated with the plant. In all cases, the decision to seek recovery in revised rates of less than the full amount of its cost must be at the utility’s sole discretion. Rate adjustments to reflect the revenue requirements related to in-service expenses must be included in the final revised rates and shall be based on the utility’s most current budget estimates of those expenses for the succeeding twelve-month period at the time the final revised rates are filed or actual expenses, if available.
2. If the commission rejects a revised rate filing on grounds that may be corrected in a subsequent filing, or if the utility withdraws a revised rate filing before a revised rates order is issued, the utility may file a subsequent request for revised rates at any time thereafter.
3. The utility may seek to recover any capital costs, in-service expenses, or other costs not included in revised rates through future general rate proceedings.

K) Where a plant is abandoned after a clean energy project construction order approving rate recovery has been issued, the capital costs and AFUDC related to the plant shall nonetheless be recoverable under this Act provided that the utility shall bear the burden of proving by a preponderance of the evidence that the decision to abandon construction of the plant was prudent. Without limiting the effect of Section VIII, recovery of capital costs and the utility’s cost of capital associated with them may be disallowed only to the extent that the failure by the utility to anticipate or avoid the allegedly imprudent costs, or to minimize the magnitude of the costs, was imprudent considering the information available at the time that the utility could have acted to avoid or minimize the costs. The commission shall order the amortization and recovery through rates of the investment in the abandoned plant as part of an order adjusting rates under this Act.

L) After completion of a plant that is subject to a clean energy project construction order, the Office of Regulatory Staff shall conduct an audit of the utility revenues, expenses, and rates consistent with the audits conducted of filings for new electric rates. The audit must be based on a twelve-month test period ending no later than December thirty-first of the calendar year following the year in which the plant entered commercial operation and must be filed with all parties to the proceeding within four months of the conclusion of the test period.

Section XI. Interventions

A) Within thirty days of the issuance of a revised rates order pursuant to Section X of this Act, or within thirty days of the failure by the commission to issue a revised rates order as required pursuant to Section X of this Act, any aggrieved party may petition the commission for review of the revised rates order or of the failure to issue a revised rates order.

B) The Office of Regulatory Staff and the utility must be automatic parties to any proceedings under this Section.

C) In filing for intervention under this Section, intervenors shall identify with particularity the specific issues they intend to raise with regard to the revised rates order.

D) The party seeking review of the revised rates order shall serve a copy of such petition on the Office of Regulatory Staff and the utility on the same day and by the same means as it is provided to the commission.

E) Any filing under this Section must be considered a new proceeding subject to the provisions of Section V. The commission shall open a single new docket for all filings related to any one set of revised rates filed under this Act.

Section XII. Petitions for Review

A) The commission shall issue its order ruling upon a petition for review of a revised rates order within six months. If the petition for review has been resolved among the parties by settlement agreement, the commission shall consider and accept or reject any settlement agreement entered into by the parties within forty-five days. If a settlement agreement is reached between some but not all parties, then the settlement agreement, if approved by the commission, must be deemed to dispose of any issues resolved in it that have not been raised by other parties to the proceeding pursuant to Section XI.

B) Proceedings pursuant to Section XI are limited to issues related to whether the revised rates filed by the utility comply with the terms of the commission order issued pursuant to Section VII and with the specific requirements of Section X.

C) In proceedings pursuant to Section XI, the commission shall allow limited discovery, and restrict the issues for discovery and hearing to whether the revised rates comply with the terms of the commission order issued pursuant to Section VII and compliance with the specific requirements of Section X.

D) The commission shall issue such motions to strike, protective orders, motions to quash, motions for costs and sanctions, and other rulings as are necessary to enforce the terms of this limitation.

E) The commission shall dismiss as a party any intervenor who, after notice, fails to abide by the limitations contained in this Section.

F) The failure of the commission to enforce the terms of this Section may be remedied by petition for writ of mandamus or supersedeas in the state court, which petition the court shall advance over all other matters on its docket and hear on an emergency basis, without the requirement of a formal answer or other return, such hearing to be held as soon as practicable upon twenty-four hours notice to the party against whom relief is sought. Proceedings related to the petitions may not serve to stay or delay proceedings before the commission.

G) The commission shall issue a final order that:

1) sets forth any changes that are required to the rates approved in the revised rates order;
2) determines the amount of any overcollection or undercollection of the revenues by the utility that resulted from application of the rates authorized in the revised rates order as compared to the rates authorized in the final order issued under this Section; and
3) establishes a credit to refund the amount of an overcollection or a surcharge to collect the amount of an undercollection of revenues that arose during the time that the rates approved in the revised rates order, or imposed due to a failure of the commission to issue a revised rates order, were applicable and requires the utility to apply the credit or surcharge until such time as the overcollection or undercollection is exhausted.

H) If the final order increases the amount of capital costs for which the utility may recover its weighted average cost of capital through revised rates, the AFUDC booked on those capital costs between the issuance of the revised rates order and the final order shall remain on the books of the utility and shall not be reversed or adjusted. Surcharges related to undercollection of costs must be calculated without consideration of AFUDC amounts recognized on the capital costs during this period.

I) If the final order reduces the amount of capital cost for which the utility may recover its weighted average cost of capital through revised rates for reasons other than the conclusive finding that the capital costs were imprudently incurred, then the utility may resume accrual of AFUDC on any capital costs that were not included in rate recovery and may book an amount of AFUDC equal to the AFUDC not recognized during the time the rates approved in the revised rates order were in effect.

Section XIII. Reapplication

The denial of a clean energy project development application, or clean energy project construction application, under this Act shall not preclude the utility from filing a new or amended clean energy project development application or clean energy project construction application at any time. A utility may proceed to construct a plant even if assurance of prudency or cost recovery under this Act is not sought or is denied, and the failure to seek or obtain such an assurance may not be used as evidence or precedent in any future proceeding.

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