[Congressional Bills 106th Congress]
[From the U.S. Government Publishing Office]
[H.R. 2734 Introduced in House (IH)]
106th CONGRESS
1st Session
H. R. 2734
To allow local government entities to serve as nonprofit aggregators of
electricity services on behalf of their citizens.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
August 5, 1999
Mr. Brown of Ohio (for himself, Mr. Delahunt, Ms. McCarthy of Missouri,
Mr. Kucinich, Ms. Kaptur, Mrs. Jones of Ohio, and Mr. Tierney)
introduced the following bill; which was referred to the Committee on
Commerce
_______________________________________________________________________
A BILL
To allow local government entities to serve as nonprofit aggregators of
electricity services on behalf of their citizens.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Community Choice for Electricity Act
of 1999''.
SEC. 2. DEFINITIONS.
As used in this Act:
(1) The term ``aggregation'' means the purchase or
acquisition of retail electricity on behalf of two or more
consumers.
(2) The term ``electric utility franchise'' means rights
granted to a utility company by a local government which
provide conditions under which the utility conducts its
operations and services within the boundaries of the local
government.
(3) The term ``municipal electric utility'' means a city,
county, irrigation district, drainage district, public utility
district, or other political subdivision or agency of a State
competent under the laws thereof to carry on the business of a
retail electricity distributor and/or a retail electricity
supplier.
(4) The term ``opt-out aggregation plan'' means aggregation
in which all customers within the jurisdiction of a local
government unit are automatically included unless they
affirmatively choose a supplier other than the supplier
designated by the local government unit.
(5) The term ``retail electric consumer'' means any person
who purchases or offers to purchase any retail electric supply.
(6) The term ``rural electric cooperative'' means an
enterprise or organization owned by and operated for the
benefit of those receiving retail electricity (usually
distribution and supply) and other services from the
cooperative.
(7) The term ``State'' means a State, the District of
Columbia, the Commonwealth of Puerto Rico, the Virgin Islands,
Guam, American Samoa, the Commonwealth of the Northern Mariana
Islands, and Indian tribes as defined in section 102(2) of the
Federally Recognized Indian Tribe List Act of 1994 (25 U.S.C.
479a(2)).
(8) The term ``State regulatory authority'' means any State
agency which has ratemaking authority with respect to the
provision of local electric energy distribution services by any
local distribution company.
(9) The term ``supplier'' means any person who produces,
generates, manufactures, aggregates, markets, brokers, sells,
or otherwise supplies electric energy.
SEC. 3. FINDINGS.
Congress finds the following:
(1) Many States are deregulating retail sales of
electricity.
(2) Deregulation of retail sales of electricity must
benefit all customers, including residential and small business
customers.
(3) In States that have deregulated retail sales of
electricity, large industrial and commercial customers are
winning the best deals, and few choices are yet available to
residential and small business consumers.
(4) It is likely that most residential customers will not
actively choose a new electricity supplier and instead will
remain customers of their current electricity supplier for
years to come;
(5) All customers, especially residential and small
business customers, will often find it difficult and
frustrating to find the time and sufficient information to
fully evaluate competing offers from electricity suppliers.
(6) Aggregation into larger buying groups will enable
consumers to achieve greater leverage and thus better prices
and services in electricity markets.
(7) Community choice is a particular type of aggregation in
which a local government negotiates a contract for electric
energy on behalf of all citizens within its boundaries.
Residents or businesses in the community who prefer to choose
their own electricity suppliers would be free to ``opt out''.
(8) All consumers taking part in community choice
aggregation can benefit, including large customers, who can
still receive price differentiation based on their larger
usage.
(9) Local governments are experienced in working with
technical consultants to negotiate contracts and deliver
services to their citizens.
(10) Local governments are accountable to their
constituents through elections, open meetings laws, fair
bidding laws, and conflict of interest laws.
(11) Because local governments exercising community choice
must include all electricity customers within the jurisdiction
who want to participate, all citizens and businesses who so
choose can benefit, while other types of retail electricity
suppliers will seek to serve the more profitable customers or
specific types of customers.
(12) Local governments can provide an electric load that
has diversity and may be attractive to electricity suppliers.
(13) In States that have deregulated retail sales of
electricity, citizens should be able to use traditional public
processes to determine whether their local governments should
act as nonprofit aggregators for their communities.
(14) In States in which they hold franchise powers for
electricity, local governments should be able to use their
franchise to exercise community choice.
SEC. 4. AGGREGATION.
Notwithstanding any other provision of Federal or State law, and
subject to legitimate and nondiscriminatory State requirements imposed
on retail electric suppliers, a group of customers or any entity,
including a unit of State or local government, acting on behalf of such
group may acquire retail electric energy on an aggregate basis if the
group of customers is served by one or more local distribution
companies that are subject to retail competition.
SEC. 5. COMMUNITY CHOICE AGGREGATION.
Title VI of the Public Utility Regulatory Policies Act of 1978 is
amended by adding the following new section at the end thereof:
``SEC. 609. COMMUNITY CHOICE AGGREGATION.
``(a) Community Choice Aggregation of Electric Load.--Any State
that permits any group of retail electric consumers to choose among
competing suppliers of electric energy shall permit any general purpose
local government unit for any political subdivision of the State, or
group of such general purpose units of local government acting
together, to offer to act as an agent for all purchasers that are
within such group of retail electric consumers and that are located
within the boundaries of such political subdivision for the purpose of
purchasing electric energy on an aggregate basis if such local
government, or group of local governments, comply with the requirements
of subsection (b).
``(b) Requirements.--
``(1) Approval by vote.--A local government shall be
covered by the provisions of subsection (a) only if such
government has approved the aggregation of electric energy
purchases by a vote of its elected governing body or by a vote
of its citizens. Two or more local governments shall be covered
by the provisions of subsection (a) only if such governments
have approved the aggregation of electric energy purchases by a
vote of the elected governing body or by a vote of the citizens
of each local government.
``(2) Participation not mandatory.--A local government
shall be covered by the provisions of subsection (a) only if
all retail electric consumers permitted to choose among
competing suppliers of electric energy that are located within
the boundaries of such political subdivision are offered the
opportunity to participate in the aggregation of purchases and
any such consumer choosing not to participate is permitted to
opt out and purchase electric energy from another agent acting
as an aggregator or directly from any supplier or other person.
``(3) State regulatory authorities.--Each State regulatory
authority for a State that permits any group of retail electric
consumers to choose among competing suppliers of electric
energy shall cooperate with local governments for the purpose
of compliance with this subsection. Each such State regulatory
authority shall establish guidelines for local governments
acting as community choice electricity aggregators. No State
regulatory authority may interfere with a local government's
existing powers to procure competitive energy services under
existing Federal and State law, city charter provisions, or
local procurement practices.
``(4) Funds for renewable energy or energy efficiency.--
Each State that permits any group of retail electric consumers
to choose among competing suppliers and that also authorizes or
mandates the collection of funds for renewable energy or energy
efficiency programs shall permit local governments that serve
as community choice aggregators of electric energy purchases to collect
and expend such funds in the case of consumers within the aggregated
jurisdiction if the local government has prepared and approved a plan
for such collection and expenditure at the local level and State
regulators have reviewed and approved said plan as consistent with
State energy goals and as providing an appropriate contribution to any
statewide or regional renewable energy or energy efficiency fund that
benefits the aggregated jurisdiction.
``(c) Federal Power Act Jurisdiction.--No local government that
aggregates electric load as described in subsection (a) shall be
considered a utility engaging in the wholesale purchase and resale of
electricity for purposes of the Federal Power Act. Providing
electricity to aggregated customers within the boundaries of a local
government as described in subsection (a) shall not be considered a
wholesale transaction subject to the jurisdiction of the Federal Energy
Regulatory Commission under the Federal Power Act.
``(d) Enforcement.--The Federal Energy Regulatory Commission may
bring an action in the appropriate United States District Court against
any State to require compliance with the provisions of subsection (a).
``(e) Savings Provision.--Nothing in this section shall be
construed to prohibit the aggregation of electric load by local
government units in a different manner under other authority of law.''.
SEC. 6. FRANCHISES.
Any State that has deregulated retail sales of electricity shall
permit local governments to exercise local franchise powers. A local
government that has granted a franchise to a utility at a prior time
may offer such franchise for competitive bidding and contract award,
provided such measures are authorized by consumers in a public process.
SEC. 7. EXCLUSIONS.
(a) Utilities Not Participating.--For municipal electric utilities
and rural electric cooperatives that are not participating in retail
electric competition, sections 4, 5, and 6 of this Act shall not apply.
(b) Aggregation.--For States that have adopted retail competition
by law or regulation prior to the date of enactment of this Act,
sections 4, 5, and 6 of this Act shall not apply to the provisions of a
State law or regulation, and any subsequent regulation implementing
such State law or regulation as such law or regulation may pertain to
an opt-out aggregation plan as it may be undertaken by any general
purpose local government unit for any political subdivision of the
State including a municipal corporation, county government or township.
SEC. 8. SEPARABILITY.
If any provision of this Act (or the application of that provision
to particular persons or circumstances) is held invalid, the remainder
of this Act (or the application of that provision to other persons or
circumstances) shall not be affected.
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