[Congressional Record Volume 153, Number 43 (Tuesday, March 13, 2007)]
[Senate]
[Pages S3073-S3075]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. BUNNING (for himself and Mr. McConnell):
  S. 864. A bill to amend the Federal Power Act to clarify the 
jurisdiction of the Federal Energy Regulatory Commission, and for other 
purposes; to the Committee on Energy and Natural Resources.
  Mr. BUNNING. Mr. President, today I am introducing the Access to 
Competitive Power Act of 2007 with my friend and colleague, Senator 
Mitch McConnell.
  I have spent years negotiating and working with the Tennessee Valley 
Authority. I have long believed we could work together to address the 
problems facing my customers in Kentucky. But every time I think I see 
the light at the end of the tunnel, representatives of TVA change their 
offer or make up a new rule.
  I was optimistic that the expanded Board of Directors of the TVA 
Congress authorized last session would be able to change the problems 
of the past. But after many meetings and negotiations, I am convinced 
that TVA believes it has monopoly status and does not answer to anyone.
  Today, I am telling TVA that the people of Kentucky deserve better.
  For too long the TVA has acted against the best interests of the 
people of Kentucky. Five electric distributors, Paducah, Princeton, 
Warren County, Glasgow and Monticello, gave their notice to TVA to 
leave the system when they realized they could get cheaper electricity 
on the open market--and save their customers millions of dollars.
  During the past few years, they have negotiated in good faith for 
basic services that are considered routine in the utility industry. But 
unfortunately, the electric customers of Kentucky are stuck on the TVA 
island. We forced them onto that island 75 years when we created the 
Tennessee Valley Authority. Their options are limited and they

[[Page S3074]]

are wholly reliant on TVA for generation and transmission service. TVA 
knows this--and that is why they have continued to stall on providing 
reasonable services.
  But the distributors who still intend to leave will now build 
hundreds of miles of new high voltage power lines to get access to the 
national electric grid. One may even need to run the city on diesel 
generators. Despite these costs, the numbers show that their customers 
will still save money.
  The legislation I am introducing today, with Senator Mitch McConnell, 
will give FERC full jurisdiction in relation to the Tennessee Valley 
Authority--the same jurisdiction that FERC has over utilities 
throughout the country.
  Let me be clear--this legislation does not mandate contract language. 
It simply requires TVA to negotiate these services in good faith.
  It defines the rights of two classes of TVA distributors--those who 
provided notice of termination prior to calendar year 2007 and those 
who did not provide notice.
  For distributors in Kentucky and Tennessee who have previously given 
notice that they would like to leave TVA service, this legislation 
would put their rights into law.
  Specifically, it would allow them to negotiate partial requirements 
services--making sure that TVA is not an all or nothing deal. For some 
customers it may make sense to get some power from TVA and some power 
from another generator.
  It also requires TVA to provide transmission service for these 
customers. Because of Federal law, TVA is their only access point to 
the national electric grid. As such, they should provide reasonable 
transmission service.
  It prevents TVA from charging these customers for stranded costs or 
imposing a reintegration fee and provides the customers the right to 
rescind their notice of termination if they ultimately decide they 
would like to stay with TVA.
  And lastly, it allows everyone who enjoys the benefits of cheap, 
Federal power from the Power Marketing Administrations to retain a 
right to that power regardless of whether or not they choose to be a 
customer of TVA.
  For all those customers who would like to stay in TVA, this 
legislation would give them the right to get partial requirements 
service from outside of TVA in an amount equal to TVA load growth.
  I also believe that it is time the Government looks closely at the 
Tennessee Valley Authority. That is why my legislation asks for two 
important G.A.O. studies. First, it commissions a comprehensive study 
on the privatization the Tennessee Valley Authority. Second, it 
requests an analysis of the debt level of the Tennessee Valley 
Authority.
  All Kentuckians deserve to choose where they receive their power. 
This bill will not only give them that choice, but it will also create 
a more competitive environment among Kentucky distributors and allow 
our businesses and residential consumers to keep more money in their 
pockets.
  I ask unanimous consent that the text of the bill be printed in the 
Record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                 S. 864

       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 ``Access to Competitive Power 
     Act of 2007''.

     SEC. 2. ESTABLISHMENT OF EQUAL ACCESS AND TREATMENT WITH 
                   RESPECT TO FEDERAL POWER RESOURCES.

       Section 212(i) of the Federal Power Act (16 U.S.C. 824k(i)) 
     is amended--
       (1) by redesignating paragraphs (2) through (5) as 
     paragraphs (3) through (6), respectively;
       (2) by striking the subsection designation and heading and 
     all that follows through the end of paragraph (1) and 
     inserting the following:
       ``(i) Establishment of Equal Access and Treatment With 
     Respect to Federal Power Resources.--
       ``(1) Definition of generator.--In this subsection, the 
     term `generator' means--
       ``(A) the Bonneville Power Administration;
       ``(B) the Southeastern Power Administration;
       ``(C) the Western Area Power Administration;
       ``(D) the Southwestern Power Administration; and
       ``(E) the Tennessee Valley Authority.
       ``(2) Authority and duties of commission.--
       ``(A) In general.--Pursuant to sections 210, 211, and 213, 
     the Commission--
       ``(i) may order the administrator or board of directors, as 
     applicable, of any generator to provide transmission service, 
     including by establishing the terms and conditions of the 
     service; and
       ``(ii) shall ensure that--

       ``(I) the provisions of otherwise applicable Federal laws 
     shall continue in full force and effect and shall continue to 
     be applicable to the system;
       ``(II) the rates for the transmission of electric power on 
     the system of each Federal power marketing agency--

       ``(aa) are administered in accordance with applicable 
     Federal law, other than sections 210, 211, and 213; and
       ``(bb) are not unjust, unreasonable, or unduly 
     discriminatory or preferential, as determined by the 
     Commission.
       ``(B) Tennessee valley authority rates.--
       ``(i) In general.--Notwithstanding any other provision of 
     law, the Commission shall have jurisdiction over the rates, 
     terms, and conditions of the provision of transmission 
     service in interstate commerce by the Tennessee Valley 
     Authority.
       ``(ii) Tariff.--Notwithstanding any other provision of law, 
     pursuant to sections 205 and 206, the Board of Directors of 
     the Tennessee Valley Authority shall have on file with the 
     Commission an open access transmission tariff that contains 
     just, reasonable, and not unduly preferential or 
     discriminatory rates, terms, and conditions for the provision 
     of transmission service in interstate commerce by the 
     Tennessee Valley Authority.'';
       (3) in paragraph (3) (as redesignated by paragraph (1))--
       (A) by striking ``(3) Notwithstanding'' and inserting the 
     following:
       ``(3) Procedure for determinations.--Notwithstanding'';
       (B) in the matter preceding subparagraph (A), by inserting 
     ``of a Federal power marketing agency'' after ``service''; 
     and
       (C) in subparagraph (A)--
       (i) by striking ``when the Administrator of the Bonneville 
     Power Administration either'' and inserting ``if the 
     Administrator of any Federal power marketing agency''; and
       (ii) by striking ``on the Federal Columbia River 
     Transmission System'';
       (4) in paragraph (4) (as redesignated by paragraph (1))--
       (A) by striking ``(4) Notwithstanding'' and inserting the 
     following:
       ``(4) Judicial review.--Notwithstanding'';
       (B) by striking ``the Administrator of the Bonneville Power 
     Administration'' and inserting ``the Administrator of a 
     Federal power marketing agency''; and
       (C) by striking ``United States Court of Appeals'' and all 
     that follows through the end of the paragraph and inserting 
     ``United States court of appeals of jurisdiction of the 
     Federal power marketing agency.'';
       (5) in paragraph (5) (as redesignated by paragraph (1)), by 
     striking ``(5) To the extent the Administrator of the 
     Bonneville Power Administration'' and inserting the 
     following:
       ``(5) Exception.--To the extent that an Administrator of a 
     Federal power marketing agency'';
       (6) in paragraph (6) (as redesignated by paragraph (1))--
       (A) by striking ``(6) The Commission'' and inserting the 
     following:
       ``(6) Prohibition.--The Commission''; and
       (B) by striking ``the Administrator of the Bonneville Power 
     Administration'' and inserting ``the Administrator of a 
     Federal power marketing agency''.

     SEC. 3. EQUITABILITY WITHIN TERRITORY RESTRICTED ELECTRIC 
                   SYSTEMS.

       Section 212(j) of the Federal Power Act (16 U.S.C. 824k(j)) 
     is amended--
       (1) by striking ``With respect to'' and inserting the 
     following:
       ``(1) In general.--Except as provided in paragraph (2), 
     with respect to'';
       (2) by striking ``electric utility:'' and all that follows 
     through ``electric utility.'' and inserting ``electric 
     utility.''; and
       (3) by adding at the end the following:
       ``(2) Exception.--Paragraph (1) and subsection (f) shall 
     not apply to any area served at retail by a distributor 
     that--
       ``(A) on October 24, 1992, served as a distributor for an 
     electric utility described in paragraph (1); and
       ``(B) before December 31, 2006, provided to the Commission 
     a notice of termination of the power supply contract between 
     the distributor and the electric utility, regardless of 
     whether the notice was later withdrawn or rescinded.
       ``(3) Stranded costs.--An electric utility described in 
     paragraph (1) that provides transmission service pursuant to 
     an order of the Commission or a contract may not recover any 
     stranded cost associated with the provision of transmission 
     services to a distributor.
       ``(4) Rights of distributors.--
       ``(A) Notice not provided.--A distributor described in 
     paragraph (2) that did not provide a notice described in 
     paragraph (2)(B) by December 31, 2006, may--
       ``(i) construct, own, and operate any generation facility, 
     individually or jointly with another distributor; and
       ``(ii) receive from any electric utility described in 
     paragraph (1) partial requirements services, unless the 
     cumulative quantity of

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     energy provided by the electric utility exceeds a ratable 
     limit that is equal to a proxy for load growth on the 
     electric utility, based on--

       ``(I) the total quantity of energy sold by each affected 
     agency, corporation, or unit of the electric utility during 
     calendar year 2006; and
       ``(II) a 3-percent compounded annual growth rate.

       ``(B) Notice provided.--
       ``(i) In general.--A distributor described in paragraph (2) 
     that provided a notice described in paragraph (2)(B) by 
     December 31, 2006, may--

       ``(I) construct, own, and operate any generation facility, 
     individually or jointly with another distributor;
       ``(II) receive from any electric utility described in 
     paragraph (1) partial requirements services;
       ``(III) receive from any electric utility described in 
     paragraph (1) transmission services that are sufficient to 
     meet all electric energy requirements of the distributor, 
     regardless of whether an applicable contract, or any portion 
     of such a contract, has been terminated under this section; 
     and
       ``(IV) not later than 180 days after the date of enactment 
     of this paragraph, elect to rescind the notice of termination 
     of the distributor without the imposition of a reintegration 
     fee or any similar fee.

       ``(ii) Treatment.--On an election by a distributor under 
     clause (i)(IV), the distributor shall be entitled to all 
     rights and benefits of a distributor described in 
     subparagraph (A).
       ``(5) Right to retain access to services.--
       ``(A) Definitions.--In this paragraph:
       ``(i) Affected distributor.--The term `affected 
     distributor' means a distributor that receives any electric 
     service or power from at least 2 generators.
       ``(ii) Generator.--The term `generator' means an entity 
     referred to in any of subparagraphs (A) through (E) of 
     subsection (i)(1).
       ``(B) Retention of services.--An affected distributor may 
     elect to retain any electric service or power provided by a 
     generator, regardless of whether an applicable contract, or 
     any portion of such a contract, has been terminated under 
     this section.
       ``(C) Effect of notice of termination.--
       ``(i) In general.--The provision or execution by an 
     affected distributor of a notice of termination described in 
     paragraph (2)(B) with 1 generator shall not affect the 
     quantity of electric service or power provided to the 
     affected distributor by another generator.
       ``(ii) Price.--The price of electric services or power 
     provided to an affected distributor described in clause (i) 
     shall be equal to the price charged by the applicable 
     generator for the provision of similar services or power to a 
     distributor that did not provide a notice described in 
     paragraph (2)(B).
       ``(D) Transmission service.--On an election by an affected 
     distributor under subparagraph (B) to retain an electric 
     service or power, the affected distributor shall be entitled 
     to receive from a generator transmission service to 1 or more 
     delivery points of the affected distributor, as determined by 
     the affected distributor, regardless of whether an applicable 
     contract, or any portion of such a contract, has been 
     terminated under this section.''.

     SEC. 4. STUDY OF PRIVATIZATION OF TENNESSEE VALLEY AUTHORITY.

       (a) Study.--The Comptroller General of the United States 
     shall conduct a study of the costs, benefits, and other 
     effects of privatizing the Tennessee Valley Authority.
       (b) Report.--Not later than 180 days after the date of 
     enactment of this Act, the Comptroller General of the United 
     States shall submit to Congress a report that describes the 
     results of the study conducted under this section.

     SEC. 5. STUDY OF DEBT LEVEL OF TENNESSEE VALLEY AUTHORITY.

       (a) Study.--The Comptroller General of the United States 
     shall conduct a study of the financial structure of, and the 
     amount of debt held by, the Tennessee Valley Authority, which 
     (as of February 1, 2007) is approximately $25,000,000,000.
       (b) Report.--Not later than 180 days after the date of 
     enactment of this Act, the Comptroller General of the United 
     States shall submit to Congress a report that describes the 
     results of the study conducted under this section.

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