HB679.html

To amend Title 46 of the Official Code of Georgia Annotated, relating to public utilities and public transportation, so as to change the provisions relating to the purposes and powers of electric membership corporations; to change provisions of the "Natural Gas Competition and Deregulation Act"; to change the definition of certain terms; to define additional terms; to require the Public Service Commission to adopt code of conduct rules and enforcement procedures to govern the relationship between an electric membership corporation and its EMC gas affiliate; to provide that the code of conduct rules shall include certain requirements; to limit the amount an electric membership corporation may invest in an EMC gas affiliate; to further regulate the relationship between an electric membership corporation and its EMC gas affiliate; to clarify existing law applicable to the provision of ancillary services; to prescribe certain duties for the Public Service Commission; to provide that an EMC gas affiliate of an electric membership corporation organized and operating pursuant to certain laws may apply for and be granted a certificate of authority to provide gas services as authorized under certain provisions of law on the same basis as any other person granted such authority; to provide that the creation, capitalization, and control of an EMC gas affiliate engaged in the distribution of gas or other persons providing ancillary services shall be deemed to be among the purposes of an electric membership corporation; to provide that nothing in this Act shall be deemed to increase or decrease the authority and jurisdiction of the Public Service Commission with respect to an electric membership corporation except as to gas distribution services undertaken by the electric membership corporation or its EMC gas affiliate as authorized under this Act; to provide for related matters; to provide an effective date; to repeal conflicting laws; and for other purposes.

Said title is further amended by striking in their entirety paragraphs (25) and (26) of subsection (b) of Code Section 46-3-201, relating to existence of electric membership corporations under articles of incorporation and powers of corporations generally, and inserting in lieu thereof the following:
"(25) To assist any other electric membership corporation in the execution of its purposes and powers under this article; ~~and~~
(26) To have and exercise all powers necessary or convenient to effect any or all of the purposes for which the electric membership corporation is organized;
(27) To engage in the natural gas business as a marketer as such term is defined in paragraph (13) of Code Section 46-4-152, provided that the electric membership corporation complies with the provisions of Article 5 of Chapter 4 of this title, the 'Natural Gas Competition and Deregulation Act,' and rules and regulations of the commission promulgated pursuant to said article; and
(28) To contract with any marketer as such term is defined in paragraph (13) of Code Section 46-4-152 to handle billing and provide customer services for such marketer."

Said title is further amended by striking in its entirety Code Section 46-4-152, relating to definitions applicable under Article 5 of Chapter 4 of said title, and inserting in lieu thereof a new Code Section 46-4-152 to read as follows:
"46-4-152.
As used in this article, the term:
(1) 'Adequate market conditions' means the existence of market conditions in relation to distribution service within a particular delivery group that have been determined pursuant to subsection (b) of Code Section 46-4-156 to warrant customer assignment.
(2) 'Affiliate' means another person which controls, is controlled by, or is under common control with such person.
(3) 'Ancillary service' means a service that is ancillary to the receipt or delivery of natural gas, including without limitation storage, balancing, peaking, and customer services. Notwithstanding any provision of law to the contrary, any person may perform an ancillary service without first becoming certificated pursuant to Code Section 46-4-153.
(4) 'Commodity sales service' means the sale of natural gas exclusive of any distribution or ancillary service.
(5) 'Control' includes without limitation the possession, directly or indirectly and whether acting alone or in conjunction with others, of the authority to direct or cause the direction of the management or policies of a person. A voting interest of 10 percent or more creates a rebuttable presumption of control. A voting interest of 25 percent or more is deemed to constitute control. The term control includes the terms controlling, controlled by, and under control with and, with respect to electric membership corporations and their EMC gas affiliates, under common management with.
(6) 'Customer assignment' means the process described in subsection (e) of Code Section 46-4-156 whereby retail customers within a particular distribution group who are not under contract for distribution service from a marketer are randomly assigned to certificated marketers.
(7) 'Customer service' means a function related to serving a retail customer including without limitation billing, meter reading, turn-on service, and turn-off service.
(8) 'Delivery group' means a set of individual delivery points on one or more interstate pipeline suppliers to a gas company that may be aggregated and utilized for the distribution of gas to a particular set of retail customers.
(9) 'Distribution service' means the delivery of natural gas by and through the intrastate instrumentalities and facilities of a gas company or of a marketer certificated pursuant to Code Section 46-4-153, regardless of the party having title to the natural gas.
(10) 'Electing distribution company' means a gas company which elects to become subject to the provisions of this article and satisfies the requirements of Code Section 46-4-154.
(10.1) 'Electric membership corporation' or 'EMC' means any person defined in paragraph (3) or (5) of Code Section 46-3-171.
(10.2) 'Electricity activities' means all activities associated with the generation, transportation, marketing, and distribution of electricity.
(10.3) 'EMC gas affiliate' means a separately organized person, the majority interest of which is owned or held by or, with respect to a cooperative, managed by one or more cooperatives or electric membership corporations and which applies to the commission for a certificate of authority pursuant to Code Section 46-4-153.
(11) 'Firm' means a type of distribution service which ordinarily is not subject to interruption or curtailment.
(11.1) 'Gas activities' means all activities associated with the transportation, marketing, and distribution of natural gas conducted by a person certificated pursuant to Code Section 46-4-153. Such term shall not mean the generation, transportation, marketing, or distribution of liquefied petroleum gas.
(12) 'Interruptible' means a type of distribution service which is subject to interruption or curtailment.
(12.1) 'Majority interest' means the ownership of 51 percent or more of:
(A) The partnership interest in a general or limited partnership;
(B) The membership interests of a limited liability company; or
(C) The stock in a for profit corporation which entitles the shareholder to vote and share in common or preferred dividends.
(13) 'Marketer' means any person certificated by the commission to provide commodity sales service or distribution service pursuant to Code Section 46-4-153 or ancillary services incident thereto.
(14) 'Person' means any corporation, whether public or private; company; individual; firm; partnership; or association, including a cooperative or an electric membership corporation.
(15) 'Retail customer' or 'retail purchaser' means a person who purchases commodity sales service or distribution service and such purchase is not for the purpose of resale.
(16) 'Straight fixed variable' means a rate form in which the fixed costs of providing distribution service are recovered through one or more fixed components and the variable costs are recovered through one or more variable components.
(17) 'Winter heating season' means the calendar days from October 1 of one year through March 31, inclusive, of the following year."

Said title is further amended by adding between Code Section 46-4-160.1 and 46-4-161 a new Code Section 46-4-160.2 to read as follows:
"46-4-160.2.
(a) No later than September 30, 2001, the commission shall adopt a code of conduct rules and enforcement procedures to govern the relationship between an electric membership corporation and its EMC gas affiliate. The rules promulgated under this Code section shall be designed to prevent cross-subsidization between the provision of electricity and the provision of natural gas services, to encourage competition by EMC gas affiliates in the marketing of natural gas to retail customers, and to protect the privacy of both electric and gas customers.
(b) The code of conduct rules adopted by the commission under this Code section shall include the requirements set forth in this subsection, as well as such other rules as the commission shall determine are necessary to protect electric and gas customers and promote competition:
(1) To ensure that cross-subsidizations do not occur between the electricity services of an electric membership corporation and the gas activities of its EMC gas affiliate, the rules adopted by the commission shall provide that each electric membership corporation having an EMC gas affiliate shall:
(A) Fully allocate all electricity activities costs and gas activities costs, including costs for any shared services, between the electric membership corporation´s electricity activities and the gas activities of its EMC gas affiliate, in accordance with the applicable uniform system of accounts and generally accepted accounting principles, as applicable;
(B) Develop and maintain a cost allocation manual, approved by the commission, describing the electric membership corporation´s methods of cost allocation and such other information and policies reasonably required by the commission to ensure compliance with this article and the code of conduct promulgated by the commission. Such manual shall:
(i) Establish rules for the pricing of transactions between an electric membership corporation and its EMC gas affiliate, including the transfer of assets among the two;
(ii) Prohibit discriminatory pricing among similarly situated gas customers;
(iii) Provide that any loans from the electric membership corporation to its EMC gas affiliate shall be at market rates and may not be tied directly to any loans from the federal or state government;
(iv) Require the electric membership corporation and its EMC gas affiliate to maintain separate books of accounts and records; and
(v) Require the annual filing of a statement with the commission certifying the compliance by the electric membership corporation and its EMC gas affiliate with the approved cost allocation manual; and
(C) Not charge any costs of the EMC gas affiliate to the electric membership corporation´s electricity customers; and
(2) To protect customer privacy and prevent the misuse of customer information, the rules adopted by the commission shall provide that each electric membership corporation shall not release any proprietary customer information to its EMC gas affiliates without obtaining prior verifiable authorization from the customer, as determined in accordance with rules established by the commission.
(c) An electric membership corporation may make and maintain investments in, lend funds to, and guarantee the debts and obligations of an EMC gas affiliate in total not to exceed 15 percent of such electric membership corporation´s net utility plant.
(d) The commission shall accommodate the organizational structures of electric membership corporations; shall prohibit an electric membership corporation and any related entity from sharing directors but shall not prohibit an electric membership corporation and any related entity from sharing officers or employees; and shall permit the use of the electric membership corporation´s trade name and logo by the EMC gas affiliate, without remuneration or cost accounting, but subject to the provisions of Part 2 of Article 15 of Chapter 1 of Title 10, the 'Fair Business Practices Act of 1975,' and Part 1 of Article 15 of Chapter 1 of Title 10, the 'Uniform Deceptive Trade Practices Act.'
(e) Notwithstanding anything to the contrary contained in this Code section, the commission shall make accommodation for the specific legal requirements imposed by state or federal laws applicable to electric membership corporations and other cooperatives."

Said title is further amended by striking in its entirety Code Section 46-4-164, relating to construction of article, and inserting in lieu thereof a new Code Section 46-4-164 to read as follows:
"46-4-164.
(a) Nothing in this article shall be deemed to apply or impose requirements not otherwise existing on gas distribution companies owned by any county, municipality, other political subdivision, or governmental authority of this state; nor are the provisions of this article intended to increase or decrease the authority and jurisdiction of the commission with respect to the distribution, sale, or transportation of gas by any county, municipality, other political subdivision, or governmental authority of this state. Nothing in this article shall be construed to limit or otherwise affect the existing powers of municipal corporations or other political subdivisions of this state relating to the granting of franchises or the levying or imposition of taxes, fees, or charges.
(b) Notwithstanding any provision of law to the contrary, including, without limitation, Article 4 of Chapter 3 of this title, an EMC gas affiliate of an electric membership corporation organized and operating pursuant to Article 4 of Chapter 3 of this title may apply for and be granted a certificate of authority to provide any service as authorized under this article on the same basis as any other person as defined in Code Section 46-4-152. The creation, capitalization, or control of (1) an EMC gas affiliate engaged in activities subject to the provisions of this article and the rules and regulations established by the commission or (2) other persons providing ancillary services shall be deemed to be among the purposes of an electric membership corporation as specified in paragraphs (2) and (3) of Code Section 46-3-200. Nothing in this article shall be deemed to increase or decrease the authority and jurisdiction of the commission with respect to such electric membership corporation except as to gas activities undertaken by the electric membership corporation or its EMC gas affiliate as authorized under this chapter."