Senate Energy Industry and Mining Committee advances committee substitute for House Bill 4012 limiting PSC rate approvals

The West Virginia Senate Energy Industry and Mining Committee adopted a strike-and-insert amendment and voted to report the engrossed committee substitute for House Bill 4012 to the full Senate with the recommendation that it pass as amended, the committee chair said.

Committee counsel summarized the measure, saying it would change how the Public Service Commission (PSC) reviews proposed rate increases. "This bill prohibits the public service commission from approving any increase in rates, charges, or costs paid by West Virginia retail rate payers unless it finds based upon a preponderance of the evidence that the costs assigned to the rate payers are proportionate to or less than the benefits the rate payers will likely receive," the counsel said during the committee meeting. Counsel also said that if the commission approves any increase it must "publicly publish a written justification that quantitatively details its findings and decisions."

Counsel explained the bill would limit the PSC's ability to grant certificates of public convenience and necessity for large electric transmission projects: "The bill prohibits the PSC from granting necessity for the construction of any electric transmission line of 200 kilovolts or greater, unless the applicant demonstrates by preponderance of the evidence that the cost of the line and associated facilities allocated to West Virginia load serving entities that provide service to West Virginia regulated retail rate payers is at least generally commensurate with the benefits that will be received by West Virginia rate payers," the counsel said. The counsel added that applicants must commit to designing, constructing and placing in service within a reasonable timeframe any offtake facilities reasonably necessary to provide service if they seek to serve West Virginia retail load at their sole expense.

After counsel's explanation, the vice chairman moved adoption of a strike-and-insert committee amendment that, according to counsel, removed certain provisions from the engrossed committee substitute for House Bill 4012 and inserted language from the engrossed committee substitute for Senate Bill 669. The committee approved the amendment by voice vote; the chair declared the ayes have it. The committee then voted by voice to report the engrossed committee substitute for House Bill 4012 to the full Senate with the recommendation that it pass as amended. The committee also adopted a title amendment before adjourning.

All procedural motions recorded in the transcript were decided by voice vote; the transcript records the chair declaring "the ayes have it" but does not record numerical tallies or individual roll-call votes. The committee adjourned after the final motion, and the chair thanked staff for their work.

The bill, as described by counsel, would (1) require the PSC to apply a preponderance-of-the-evidence standard before approving rate increases that affect West Virginia retail ratepayers, (2) require the PSC to publish quantitative written justifications for approvals, and (3) restrict necessity certificates for electric transmission lines of 200 kilovolts or more unless applicants show costs allocated to West Virginia entities are generally commensurate with benefits. The measure was reported to the full Senate for further consideration.