[Congressional Bills 107th Congress]
[From the U.S. Government Publishing Office]
[S. 206 Reported in Senate (RS)]






                                                        Calendar No. 36
107th CONGRESS
  1st Session
                                 S. 206

                          [Report No. 107-15]

To repeal the Public Utility Holding Company Act of 1935, to enact the 
  Public Utility Holding Company Act of 2001, and for other purposes.


_______________________________________________________________________


                   IN THE SENATE OF THE UNITED STATES

                            January 30, 2001

 Mr. Shelby (for himself, Mr. Murkowski, Mr. Sarbanes, Mr. Gramm, Mr. 
 Dodd, Mr. Lott, Mr. Craig, Mr. Crapo, Mr. Brownback, Mr. Cochran, Mr. 
 Graham, Mr. Bunning, and Mr. Nickles) introduced the following bill; 
which was read twice and referred to the Committee on Banking, Housing, 
                           and Urban Affairs

                              May 9, 2001

                Reported by Mr. Gramm, with an amendment
 [Strike out all after the enacting clause and insert the part printed 
                               in italic]

_______________________________________________________________________

                                 A BILL


 
To repeal the Public Utility Holding Company Act of 1935, to enact the 
  Public Utility Holding Company Act of 2001, and for other purposes.

    Be it enacted by the Senate and House of Representatives of the 
United States of America in Congress assembled,

<DELETED>SECTION 1. SHORT TITLE.</DELETED>

<DELETED>    This Act may be cited as the ``Public Utility Holding 
Company Act of 2001''.</DELETED>

<DELETED>SEC. 2. FINDINGS AND PURPOSES.</DELETED>

<DELETED>    (a) Findings.--Congress finds that--</DELETED>
        <DELETED>    (1) the Public Utility Holding Company Act of 1935 
        was intended to facilitate the work of Federal and State 
        regulators by placing certain constraints on the activities of 
        holding company systems;</DELETED>
        <DELETED>    (2) developments since 1935, including changes in 
        other regulation and in the electric and gas industries, have 
        called into question the continued relevance of the model of 
        regulation established by that Act;</DELETED>
        <DELETED>    (3) there is a continuing need for State 
        regulation in order to ensure the rate protection of utility 
        customers; and</DELETED>
        <DELETED>    (4) limited Federal regulation is necessary to 
        supplement the work of State commissions for the continued rate 
        protection of electric and gas utility customers.</DELETED>
<DELETED>    (b) Purposes.--The purposes of this Act are--</DELETED>
        <DELETED>    (1) to eliminate unnecessary regulation, yet 
        continue to provide for consumer protection by facilitating 
        existing rate regulatory authority through improved Federal and 
        State commission access to books and records of all companies 
        in a holding company system, to the extent that such 
        information is relevant to rates paid by utility customers, 
        while affording companies the flexibility required to compete 
        in the energy markets; and</DELETED>
        <DELETED>    (2) to address protection of electric and gas 
        utility customers by providing for Federal and State access to 
        books and records of all companies in a holding company system 
        that are relevant to utility rates.</DELETED>

<DELETED>SEC. 3. DEFINITIONS.</DELETED>

<DELETED>    For purposes of this Act--</DELETED>
        <DELETED>    (1) the term ``affiliate'' of a company means any 
        company, 5 percent or more of the outstanding voting securities 
        of which are owned, controlled, or held with power to vote, 
        directly or indirectly, by such company;</DELETED>
        <DELETED>    (2) the term ``associate company'' of a company 
        means any company in the same holding company system with such 
        company;</DELETED>
        <DELETED>    (3) the term ``Commission'' means the Federal 
        Energy Regulatory Commission;</DELETED>
        <DELETED>    (4) the term ``company'' means a corporation, 
        partnership, association, joint stock company, business trust, 
        or any organized group of persons, whether incorporated or not, 
        or a receiver, trustee, or other liquidating agent of any of 
        the foregoing;</DELETED>
        <DELETED>    (5) the term ``electric utility company'' means 
        any company that owns or operates facilities used for the 
        generation, transmission, or distribution of electric energy 
        for sale;</DELETED>
        <DELETED>    (6) the terms ``exempt wholesale generator'' and 
        ``foreign utility company'' have the same meanings as in 
        sections 32 and 33, respectively, of the Public Utility Holding 
        Company Act of 1935 (15 U.S.C. 79z-5a, 79z-5b), as those 
        sections existed on the day before the effective date of this 
        Act;</DELETED>
        <DELETED>    (7) the term ``gas utility company'' means any 
        company that owns or operates facilities used for distribution 
        at retail (other than the distribution only in enclosed 
        portable containers or distribution to tenants or employees of 
        the company operating such facilities for their own use and not 
        for resale) of natural or manufactured gas for heat, light, or 
        power;</DELETED>
        <DELETED>    (8) the term ``holding company'' means--</DELETED>
                <DELETED>    (A) any company that directly or 
                indirectly owns, controls, or holds, with power to 
                vote, 10 percent or more of the outstanding voting 
                securities of a public utility company or of a holding 
                company of any public utility company; and</DELETED>
                <DELETED>    (B) any person, determined by the 
                Commission, after notice and opportunity for hearing, 
                to exercise directly or indirectly (either alone or 
pursuant to an arrangement or understanding with one or more persons) 
such a controlling influence over the management or policies of any 
public utility company or holding company as to make it necessary or 
appropriate for the rate protection of utility customers with respect 
to rates that such person be subject to the obligations, duties, and 
liabilities imposed by this Act upon holding companies;</DELETED>
        <DELETED>    (9) the term ``holding company system'' means a 
        holding company, together with its subsidiary 
        companies;</DELETED>
        <DELETED>    (10) the term ``jurisdictional rates'' means rates 
        established by the Commission for the transmission of electric 
        energy in interstate commerce, the sale of electric energy at 
        wholesale in interstate commerce, the transportation of natural 
        gas in interstate commerce, and the sale in interstate commerce 
        of natural gas for resale for ultimate public consumption for 
        domestic, commercial, industrial, or any other use;</DELETED>
        <DELETED>    (11) the term ``natural gas company'' means a 
        person engaged in the transportation of natural gas in 
        interstate commerce or the sale of such gas in interstate 
        commerce for resale;</DELETED>
        <DELETED>    (12) the term ``person'' means an individual or 
        company;</DELETED>
        <DELETED>    (13) the term ``public utility'' means any person 
        who owns or operates facilities used for transmission of 
        electric energy in interstate commerce or sales of electric 
        energy at wholesale in interstate commerce;</DELETED>
        <DELETED>    (14) the term ``public utility company'' means an 
        electric utility company or a gas utility company;</DELETED>
        <DELETED>    (15) the term ``State commission'' means any 
        commission, board, agency, or officer, by whatever name 
        designated, of a State, municipality, or other political 
        subdivision of a State that, under the laws of such State, has 
        jurisdiction to regulate public utility companies;</DELETED>
        <DELETED>    (16) the term ``subsidiary company'' of a holding 
        company means--</DELETED>
                <DELETED>    (A) any company, 10 percent or more of the 
                outstanding voting securities of which are directly or 
                indirectly owned, controlled, or held with power to 
                vote, by such holding company; and</DELETED>
                <DELETED>    (B) any person, the management or policies 
                of which the Commission, after notice and opportunity 
                for hearing, determines to be subject to a controlling 
                influence, directly or indirectly, by such holding 
                company (either alone or pursuant to an arrangement or 
                understanding with one or more other persons) so as to 
                make it necessary for the rate protection of utility 
                customers with respect to rates that such person be 
                subject to the obligations, duties, and liabilities 
                imposed by this Act upon subsidiary companies of 
                holding companies; and</DELETED>
        <DELETED>    (17) the term ``voting security'' means any 
        security presently entitling the owner or holder thereof to 
        vote in the direction or management of the affairs of a 
        company.</DELETED>

<DELETED>SEC. 4. REPEAL OF THE PUBLIC UTILITY HOLDING COMPANY ACT OF 
              1935.</DELETED>

<DELETED>    The Public Utility Holding Company Act of 1935 (15 U.S.C. 
79 et seq.) is repealed.</DELETED>

<DELETED>SEC. 5. FEDERAL ACCESS TO BOOKS AND RECORDS.</DELETED>

<DELETED>    (a) In General.--Each holding company and each associate 
company thereof shall maintain, and shall make available to the 
Commission, such books, accounts, memoranda, and other records as the 
Commission deems to be relevant to costs incurred by a public utility 
or natural gas company that is an associate company of such holding 
company and necessary or appropriate for the protection of utility 
customers with respect to jurisdictional rates.</DELETED>
<DELETED>    (b) Affiliate Companies.--Each affiliate of a holding 
company or of any subsidiary company of a holding company shall 
maintain, and shall make available to the Commission, such books, 
accounts, memoranda, and other records with respect to any transaction 
with another affiliate, as the Commission deems to be relevant to costs 
incurred by a public utility or natural gas company that is an 
associate company of such holding company and necessary or appropriate 
for the protection of utility customers with respect to jurisdictional 
rates.</DELETED>
<DELETED>    (c) Holding Company Systems.--The Commission may examine 
the books, accounts, memoranda, and other records of any company in a 
holding company system, or any affiliate thereof, as the Commission 
deems to be relevant to costs incurred by a public utility or natural 
gas company within such holding company system and necessary or 
appropriate for the protection of utility customers with respect to 
jurisdictional rates.</DELETED>
<DELETED>    (d) Confidentiality.--No member, officer, or employee of 
the Commission shall divulge any fact or information that may come to 
his or her knowledge during the course of examination of books, 
accounts, memoranda, or other records as provided in this section, 
except as may be directed by the Commission or by a court of competent 
jurisdiction.</DELETED>

<DELETED>SEC. 6. STATE ACCESS TO BOOKS AND RECORDS.</DELETED>

<DELETED>    (a) In General.--Upon the written request of a State 
commission having jurisdiction to regulate a public utility company in 
a holding company system, the holding company or any associate company 
or affiliate thereof, other than such public utility company, wherever 
located, shall produce for inspection books, accounts, memoranda, and 
other records that--</DELETED>
        <DELETED>    (1) have been identified in reasonable detail in a 
        proceeding before the State commission;</DELETED>
        <DELETED>    (2) the State commission deems are relevant to 
        costs incurred by such public utility company; and</DELETED>
        <DELETED>    (3) are necessary for the effective discharge of 
        the responsibilities of the State commission with respect to 
        such proceeding.</DELETED>
<DELETED>    (b) Limitation.--Subsection (a) does not apply to any 
person that is a holding company solely by reason of ownership of one 
or more qualifying facilities under the Public Utility Regulatory 
Policies Act of 1978.</DELETED>
<DELETED>    (c) Confidentiality of Information.--The production of 
books, accounts, memoranda, and other records under subsection (a) 
shall be subject to such terms and conditions as may be necessary and 
appropriate to safeguard against unwarranted disclosure to the public 
of any trade secrets or sensitive commercial information.</DELETED>
<DELETED>    (d) Effect on State Law.--Nothing in this section shall 
preempt applicable State law concerning the provision of books, 
records, or any other information, or in any way limit the rights of 
any State to obtain books, records, or any other information under any 
other Federal law, contract, or otherwise.</DELETED>
<DELETED>    (e) Court Jurisdiction.--Any United States district court 
located in the State in which the State commission referred to in 
subsection (a) is located shall have jurisdiction to enforce compliance 
with this section.</DELETED>

<DELETED>SEC. 7. EXEMPTION AUTHORITY.</DELETED>

<DELETED>    (a) Rulemaking.--Not later than 90 days after the 
effective date of this Act, the Commission shall promulgate a final 
rule to exempt from the requirements of section 5 any person that is a 
holding company, solely with respect to one or more--</DELETED>
        <DELETED>    (1) qualifying facilities under the Public Utility 
        Regulatory Policies Act of 1978;</DELETED>
        <DELETED>    (2) exempt wholesale generators; or</DELETED>
        <DELETED>    (3) foreign utility companies.</DELETED>
<DELETED>    (b) Other Authority.--The Commission shall exempt a person 
or transaction from the requirements of section 5, if, upon application 
or upon the motion of the Commission--</DELETED>
        <DELETED>    (1) the Commission finds that the books, records, 
        accounts, memoranda, and other records of any person are not 
        relevant to the jurisdictional rates of a public utility or 
        natural gas company; or</DELETED>
        <DELETED>    (2) the Commission finds that any class of 
        transactions is not relevant to the jurisdictional rates of a 
        public utility or natural gas company.</DELETED>

<DELETED>SEC. 8. AFFILIATE TRANSACTIONS.</DELETED>

<DELETED>    Nothing in this Act shall preclude the Commission or a 
State commission from exercising its jurisdiction under otherwise 
applicable law to determine whether a public utility company, public 
utility, or natural gas company may recover in rates any costs of an 
activity performed by an associate company, or any costs of goods or 
services acquired by such public utility company from an associate 
company.</DELETED>

<DELETED>SEC. 9. APPLICABILITY.</DELETED>

<DELETED>    No provision of this Act shall apply to, or be deemed to 
include--</DELETED>
        <DELETED>    (1) the United States;</DELETED>
        <DELETED>    (2) a State or any political subdivision of a 
        State;</DELETED>
        <DELETED>    (3) any foreign governmental authority not 
        operating in the United States;</DELETED>
        <DELETED>    (4) any agency, authority, or instrumentality of 
        any entity referred to in paragraph (1), (2), or (3); 
        or</DELETED>
        <DELETED>    (5) any officer, agent, or employee of any entity 
        referred to in paragraph (1), (2), or (3) acting as such in the 
        course of his or her official duty.</DELETED>

<DELETED>SEC. 10. EFFECT ON OTHER REGULATIONS.</DELETED>

<DELETED>    Nothing in this Act precludes the Commission or a State 
commission from exercising its jurisdiction under otherwise applicable 
law to protect utility customers.</DELETED>

<DELETED>SEC. 11. ENFORCEMENT.</DELETED>

<DELETED>    The Commission shall have the same powers as set forth in 
sections 306 through 317 of the Federal Power Act (16 U.S.C. 825e-825p) 
to enforce the provisions of this Act.</DELETED>

<DELETED>SEC. 12. SAVINGS PROVISIONS.</DELETED>

<DELETED>    (a) In General.--Nothing in this Act prohibits a person 
from engaging in or continuing to engage in activities or transactions 
in which it is legally engaged or authorized to engage on the effective 
date of this Act.</DELETED>
<DELETED>    (b) Effect on Other Commission Authority.--Nothing in this 
Act limits the authority of the Commission under the Federal Power Act 
(16 U.S.C. 791a et seq.) (including section 301 of that Act) or the 
Natural Gas Act (15 U.S.C. 717 et seq.) (including section 8 of that 
Act).</DELETED>

<DELETED>SEC. 13. IMPLEMENTATION.</DELETED>

<DELETED>    Not later than 18 months after the date of enactment of 
this Act, the Commission shall--</DELETED>
        <DELETED>    (1) promulgate such regulations as may be 
        necessary or appropriate to implement this Act (other than 
        section 6); and</DELETED>
        <DELETED>    (2) submit to the Congress detailed 
        recommendations on technical and conforming amendments to 
        Federal law necessary to carry out this Act and the amendments 
        made by this Act.</DELETED>

<DELETED>SEC. 14. TRANSFER OF RESOURCES.</DELETED>

<DELETED>    All books and records that relate primarily to the 
functions transferred to the Commission under this Act shall be 
transferred from the Securities and Exchange Commission to the 
Commission.</DELETED>

<DELETED>SEC. 15. EFFECTIVE DATE.</DELETED>

<DELETED>    This Act shall take effect 18 months after the date of 
enactment of this Act.</DELETED>

<DELETED>SEC. 16. AUTHORIZATION OF APPROPRIATIONS.</DELETED>

<DELETED>    There are authorized to be appropriated such funds as may 
be necessary to carry out this Act.</DELETED>

<DELETED>SEC. 17. CONFORMING AMENDMENT TO THE FEDERAL POWER 
              ACT.</DELETED>

<DELETED>    Section 318 of the Federal Power Act (16 U.S.C. 825q) is 
repealed.</DELETED>

SECTION 1. SHORT TITLE.

    (a) Short Title; Table of Contents.--This Act may be cited as the 
``Public Utility Holding Company Act of 2001''.
    (b) Table of Contents.--The table of contents for this Act is as 
follows:

Sec. 1. Short title.
Sec. 2. Findings and purposes.
Sec. 3. Definitions.
Sec. 4. Repeal of the Public Utility Holding Company Act of 1935.
Sec. 5. Federal access to books and records.
Sec. 6. State access to books and records.
Sec. 7. Exemption authority.
Sec. 8. Affiliate transactions.
Sec. 9. Applicability.
Sec. 10. Effect on other regulations.
Sec. 11. Enforcement.
Sec. 12. Savings provisions.
Sec. 13. Implementation.
Sec. 14. Transfer of resources.
Sec. 15. Inter-agency review of competition in the wholesale and retail 
                            markets for electric energy.
Sec. 16. GAO study on implementation.
Sec. 17. Effective date.
Sec. 18. Authorization of appropriations.
Sec. 19. Conforming amendment to the Federal Power Act.

SEC. 2. FINDINGS AND PURPOSES.

    (a) Findings.--Congress finds that--
            (1) the Public Utility Holding Company Act of 1935 was 
        intended to facilitate the work of Federal and State regulators 
        by placing certain constraints on the activities of holding 
        company systems;
            (2) developments since 1935, including changes in other 
        regulation and in the electric and gas industries, have called 
        into question the continued relevance of the model of 
        regulation established by that Act;
            (3) there is a continuing need for State regulation in 
        order to ensure the rate protection of utility customers; and
            (4) limited Federal regulation is necessary to supplement 
        the work of State commissions for the continued rate protection 
        of electric and gas utility customers.
    (b) Purposes.--The purposes of this Act are--
            (1) to eliminate unnecessary regulation, yet continue to 
        provide for consumer protection by facilitating existing rate 
        regulatory authority through improved Federal and State 
        commission access to books and records of all companies in a 
        holding company system, to the extent that such information is 
        relevant to rates paid by utility customers, while affording 
        companies the flexibility required to compete in the energy 
        markets; and
            (2) to address protection of electric and gas utility 
        customers by providing for Federal and State access to books 
        and records of all companies in a holding company system that 
        are relevant to utility rates.

SEC. 3. DEFINITIONS.

    For purposes of this Act--
            (1) the term ``affiliate'' of a company means any company, 
        5 percent or more of the outstanding voting securities of which 
        are owned, controlled, or held with power to vote, directly or 
        indirectly, by such company;
            (2) the term ``associate company'' of a company means any 
        company in the same holding company system with such company;
            (3) the term ``Commission'' means the Federal Energy 
        Regulatory Commission;
            (4) the term ``company'' means a corporation, partnership, 
        association, joint stock company, business trust, or any 
        organized group of persons, whether incorporated or not, or a 
        receiver, trustee, or other liquidating agent of any of the 
        foregoing;
            (5) the term ``electric utility company'' means any company 
        that owns or operates facilities used for the generation, 
        transmission, or distribution of electric energy for sale;
            (6) the terms ``exempt wholesale generator'' and ``foreign 
        utility company'' have the same meanings as in sections 32 and 
        33, respectively, of the Public Utility Holding Company Act of 
        1935 (15 U.S.C. 79z-5a, 79z-5b), as those sections existed on 
        the day before the effective date of this Act;
            (7) the term ``gas utility company'' means any company that 
        owns or operates facilities used for distribution at retail 
        (other than the distribution only in enclosed portable 
        containers or distribution to tenants or employees of the 
        company operating such facilities for their own use and not for 
        resale) of natural or manufactured gas for heat, light, or 
        power;
            (8) the term ``holding company'' means--
                    (A) any company that directly or indirectly owns, 
                controls, or holds, with power to vote, 10 percent or 
                more of the outstanding voting securities of a public 
                utility company or of a holding company of any public 
                utility company; and
                    (B) any person, determined by the Commission, after 
                notice and opportunity for hearing, to exercise 
                directly or indirectly (either alone or pursuant to an 
                arrangement or understanding with one or more persons) 
                such a controlling influence over the management or 
                policies of any public utility company or holding 
                company as to make it necessary or appropriate for the 
                rate protection of utility customers with respect to 
                rates that such person be subject to the obligations, 
                duties, and liabilities imposed by this Act upon 
                holding companies;
            (9) the term ``holding company system'' means a holding 
        company, together with its subsidiary companies;
            (10) the term ``jurisdictional rates'' means rates 
        established by the Commission for the transmission of electric 
        energy in interstate commerce, the sale of electric energy at 
        wholesale in interstate commerce, the transportation of natural 
        gas in interstate commerce, and the sale in interstate commerce 
        of natural gas for resale for ultimate public consumption for 
        domestic, commercial, industrial, or any other use;
            (11) the term ``natural gas company'' means a person 
        engaged in the transportation of natural gas in interstate 
        commerce or the sale of such gas in interstate commerce for 
        resale;
            (12) the term ``person'' means an individual or company;
            (13) the term ``public utility'' means any person who owns 
        or operates facilities used for transmission of electric energy 
        in interstate commerce or sales of electric energy at wholesale 
        in interstate commerce;
            (14) the term ``public utility company'' means an electric 
        utility company or a gas utility company;
            (15) the term ``State commission'' means any commission, 
        board, agency, or officer, by whatever name designated, of a 
        State, municipality, or other political subdivision of a State 
        that, under the laws of such State, has jurisdiction to 
        regulate public utility companies;
            (16) the term ``subsidiary company'' of a holding company 
        means--
                    (A) any company, 10 percent or more of the 
                outstanding voting securities of which are directly or 
                indirectly owned, controlled, or held with power to 
                vote, by such holding company; and
                    (B) any person, the management or policies of which 
                the Commission, after notice and opportunity for 
                hearing, determines to be subject to a controlling 
                influence, directly or indirectly, by such holding 
                company (either alone or pursuant to an arrangement or 
                understanding with one or more other persons) so as to 
make it necessary for the rate protection of utility customers with 
respect to rates that such person be subject to the obligations, 
duties, and liabilities imposed by this Act upon subsidiary companies 
of holding companies; and
            (17) the term ``voting security'' means any security 
        presently entitling the owner or holder thereof to vote in the 
        direction or management of the affairs of a company.

SEC. 4. REPEAL OF THE PUBLIC UTILITY HOLDING COMPANY ACT OF 1935.

    The Public Utility Holding Company Act of 1935 (15 U.S.C. 79 et 
seq.) is repealed.

SEC. 5. FEDERAL ACCESS TO BOOKS AND RECORDS.

    (a) In General.--Each holding company and each associate company 
thereof shall maintain, and shall make available to the Commission, 
such books, accounts, memoranda, and other records as the Commission 
deems to be relevant to costs incurred by a public utility or natural 
gas company that is an associate company of such holding company and 
necessary or appropriate for the protection of utility customers with 
respect to jurisdictional rates.
    (b) Affiliate Companies.--Each affiliate of a holding company or of 
any subsidiary company of a holding company shall maintain, and shall 
make available to the Commission, such books, accounts, memoranda, and 
other records with respect to any transaction with another affiliate, 
as the Commission deems to be relevant to costs incurred by a public 
utility or natural gas company that is an associate company of such 
holding company and necessary or appropriate for the protection of 
utility customers with respect to jurisdictional rates.
    (c) Holding Company Systems.--The Commission may examine the books, 
accounts, memoranda, and other records of any company in a holding 
company system, or any affiliate thereof, as the Commission deems to be 
relevant to costs incurred by a public utility or natural gas company 
within such holding company system and necessary or appropriate for the 
protection of utility customers with respect to jurisdictional rates.
    (d) Confidentiality.--No member, officer, or employee of the 
Commission shall divulge any fact or information that may come to his 
or her knowledge during the course of examination of books, accounts, 
memoranda, or other records as provided in this section, except as may 
be directed by the Commission or by a court of competent jurisdiction.

SEC. 6. STATE ACCESS TO BOOKS AND RECORDS.

    (a) In General.--Upon the written request of a State commission 
having jurisdiction to regulate a public utility company in a holding 
company system, the holding company or any associate company or 
affiliate thereof, other than such public utility company, wherever 
located, shall produce for inspection books, accounts, memoranda, and 
other records that--
            (1) have been identified in reasonable detail in a 
        proceeding before the State commission;
            (2) the State commission deems are relevant to costs 
        incurred by such public utility company; and
            (3) are necessary for the effective discharge of the 
        responsibilities of the State commission with respect to such 
        proceeding.
    (b) Limitation.--Subsection (a) does not apply to any person that 
is a holding company solely by reason of ownership of one or more 
qualifying facilities under the Public Utility Regulatory Policies Act 
of 1978 (16 U.S.C. 2601 et seq.).
    (c) Confidentiality of Information.--The production of books, 
accounts, memoranda, and other records under subsection (a) shall be 
subject to such terms and conditions as may be necessary and 
appropriate to safeguard against unwarranted disclosure to the public 
of any trade secrets or sensitive commercial information.
    (d) Effect on State Law.--Nothing in this section shall preempt 
applicable State law concerning the provision of books, records, or any 
other information, or in any way limit the rights of any State to 
obtain books, records, or any other information under any other Federal 
law, contract, or otherwise.
    (e) Court Jurisdiction.--Any United States district court located 
in the State in which the State commission referred to in subsection 
(a) is located shall have jurisdiction to enforce compliance with this 
section.

SEC. 7. EXEMPTION AUTHORITY.

    (a) Rulemaking.--Not later than 90 days after the effective date of 
this Act, the Commission shall promulgate a final rule to exempt from 
the requirements of section 5 any person that is a holding company, 
solely with respect to one or more--
            (1) qualifying facilities under the Public Utility 
        Regulatory Policies Act of 1978 (16 U.S.C. 2601 et seq.);
            (2) exempt wholesale generators; or
            (3) foreign utility companies.
    (b) Other Authority.--The Commission shall exempt a person or 
transaction from the requirements of section 5, if, upon application or 
upon the motion of the Commission--
            (1) the Commission finds that the books, records, accounts, 
        memoranda, and other records of any person are not relevant to 
        the jurisdictional rates of a public utility or natural gas 
        company; or
            (2) the Commission finds that any class of transactions is 
        not relevant to the jurisdictional rates of a public utility or 
        natural gas company.

SEC. 8. AFFILIATE TRANSACTIONS.

    (a) Commission Authority Unaffected.--Nothing in this Act shall 
limit the authority of the Commission under the Federal Power Act (16 
U.S.C. 791a et seq.) to require that jurisdictional rates are just and 
reasonable, including the ability to deny or approve the pass through 
of costs, the prevention of cross-subsidization, and the promulgation 
of such rules and regulations as are necessary or appropriate for the 
protection of utility consumers.
    (b) Recovery of Costs.--Nothing in this Act shall preclude the 
Commission or a State commission from exercising its jurisdiction under 
otherwise applicable law to determine whether a public utility company, 
public utility, or natural gas company may recover in rates any costs 
of an activity performed by an associate company, or any costs of goods 
or services acquired by such public utility company from an associate 
company.

SEC. 9. APPLICABILITY.

    Except as otherwise specifically provided in this Act, no provision 
of this Act shall apply to, or be deemed to include--
            (1) the United States;
            (2) a State or any political subdivision of a State;
            (3) any foreign governmental authority not operating in the 
        United States;
            (4) any agency, authority, or instrumentality of any entity 
        referred to in paragraph (1), (2), or (3); or
            (5) any officer, agent, or employee of any entity referred 
        to in paragraph (1), (2), or (3) acting as such in the course 
        of his or her official duty.

SEC. 10. EFFECT ON OTHER REGULATIONS.

    Nothing in this Act precludes the Commission or a State commission 
from exercising its jurisdiction under otherwise applicable law to 
protect utility customers.

SEC. 11. ENFORCEMENT.

    The Commission shall have the same powers as set forth in sections 
306 through 317 of the Federal Power Act (16 U.S.C. 825e-825p) to 
enforce the provisions of this Act.

SEC. 12. SAVINGS PROVISIONS.

    (a) In General.--Nothing in this Act prohibits a person from 
engaging in or continuing to engage in activities or transactions in 
which it is legally engaged or authorized to engage on the effective 
date of this Act.
    (b) Effect on Other Commission Authority.--Nothing in this Act 
limits the authority of the Commission under the Federal Power Act (16 
U.S.C. 791a et seq.) (including section 301 of that Act) or the Natural 
Gas Act (15 U.S.C. 717 et seq.) (including section 8 of that Act).

SEC. 13. IMPLEMENTATION.

    Not later than 18 months after the date of enactment of this Act, 
the Commission shall--
            (1) promulgate such regulations as may be necessary or 
        appropriate to implement this Act (other than section 6); and
            (2) submit to the Congress detailed recommendations on 
        technical and conforming amendments to Federal law necessary to 
        carry out this Act and the amendments made by this Act.

SEC. 14. TRANSFER OF RESOURCES.

    All books and records that relate primarily to the functions 
transferred to the Commission under this Act shall be transferred from 
the Securities and Exchange Commission to the Commission.

SEC. 15. INTER-AGENCY REVIEW OF COMPETITION IN THE WHOLESALE AND RETAIL 
              MARKETS FOR ELECTRIC ENERGY.

    (a) Task Force.--There is established an inter-agency task force, 
to be known as the ``Electric Energy Market Competition Task Force'' 
(referred to in this section as the ``task force''), which shall 
consist of--
            (1) 1 member each from--
                    (A) the Department of Justice, to be appointed by 
                the Attorney General of the United States;
                    (B) the Federal Energy Regulatory Commission, to be 
                appointed by the chairman of that Commission; and
                    (C) the Federal Trade Commission, to be appointed 
                by the chairman of that Commission; and
            (2) 2 advisory members (who shall not vote), of whom--
                    (A) 1 shall be appointed by the Secretary of 
                Agriculture to represent the Rural Utility Service; and
                    (B) 1 shall be appointed by the Chairman of the 
                Securities and Exchange Commission to represent that 
                Commission.
    (b) Study and Report.--
            (1) Study.--The task force shall perform a study and 
        analysis of the protection and promotion of competition within 
        the wholesale and retail market for electric energy in the 
        United States.
            (2) Report.--
                    (A) Final report.--Not later than 1 year after the 
                effective date of this Act, the task force shall submit 
                a final report of its findings under paragraph (1) to 
                the Congress.
                    (B) Public comment.--At least 60 days before 
                submission of a final report to the Congress under 
                subparagraph (A), the task force shall publish a draft 
                report in the Federal Register to provide for public 
                comment.
    (c) Focus.--The study required by this section shall examine--
            (1) the best means of protecting competition within the 
        wholesale and retail electric market;
            (2) activities within the wholesale and retail electric 
        market that may allow unfair and unjustified discriminatory and 
        deceptive practices;
            (3) activities within the wholesale and retail electric 
        market, including mergers and acquisitions, that deny market 
        access or suppress competition;
            (4) cross-subsidization that may occur between regulated 
        and nonregulated activities; and
            (5) the role of State public utility commissions in 
        regulating competition in the wholesale and retail electric 
        market.
    (d) Consultation.--In performing the study required by this 
section, the task force shall consult with and solicit comments from 
its advisory members, the States, representatives of the electric power 
industry, and the public.

SEC. 16. GAO STUDY ON IMPLEMENTATION.

    (a) Study.--The Comptroller General shall conduct a study of the 
success of the Federal Government and the States during the 18-month 
period following the effective date of this Act in--
            (1) the prevention of anticompetitive practices and other 
        abuses by public utility holding companies, including cross-
        subsidization and other market power abuses; and
            (2) the promotion of competition and efficient energy 
        markets to the benefit of consumers.
    (b) Report to Congress.--Not earlier than 18 months after the 
effective date of this Act or later than 24 months after that effective 
date, the Comptroller General shall submit a report to the Congress on 
the results of the study conducted under subsection (a), including 
probable causes of its findings and recommendations to the Congress and 
the States for any necessary legislative changes.

SEC. 17. EFFECTIVE DATE.

    This Act shall take effect 18 months after the date of enactment of 
this Act.

SEC. 18. AUTHORIZATION OF APPROPRIATIONS.

    There are authorized to be appropriated such funds as may be 
necessary to carry out this Act.

SEC. 19. CONFORMING AMENDMENT TO THE FEDERAL POWER ACT.

    Section 318 of the Federal Power Act (16 U.S.C. 825q) is repealed.




                                                        Calendar No. 36

107th CONGRESS

  1st Session

                                 S. 206

                          [Report No. 107-15]

_______________________________________________________________________

                                 A BILL

To repeal the Public Utility Holding Company Act of 1935, to enact the 
  Public Utility Holding Company Act of 2001, and for other purposes.

_______________________________________________________________________

                              May 9, 2001

                       Reported with an amendment