Chapter Three - STATUTORY AND
REGULATORY OVERSIGHT
3.0 INTRODUCTION
As noted in the previous chapter, governance of electric utilities in
Nebraska is based at the local level. However, the day-to-day functions
take place within the statutory and regulatory oversight of the state and
federal government. Policies of regional utility organizations such as
Mid-Continent Area Power Pool (MAPP) also have a significant impact on
Nebraska’s electric utilities. Regulatory and statutory requirements for
the various types of utility systems differ to an extent that may be
significant in considering a transition to a competitive retail market.
The following chapter examines the differing statutory and regulatory
regimes for each type of system; the jurisdictions of federal, state and
local government; issues of retail and wholesale service areas; and
fundamental requirements for service to consumers.
3.1 STATUTORY FRAMEWORK
The authority of the legislature to establish statutory law and
regulatory agencies to provide oversight for electric utilities is derived
from the Nebraska Constitution. The authority of local governments to
participate in this process is also derived from the Constitution and
framed by statute. The development of this framework has been an
evolutionary process in which the principle of local control and local
jurisdiction has been a guiding force.1
Unlike most states, consumers have played a primary role in the
development of the industry in Nebraska. Through referenda (Initiative
324) and the opportunities provided by the legislature in statutory
powers, consumers have the ability to form public power districts, rural
cooperatives and municipal systems at the local level and to participate
in the regulation of those systems.
Since passage of the Public Power District Enabling Act in 1933, the
legislature has functioned to promote, support and urge cooperation in
local actions.2 During this time, the industry has replaced
private utility companies with expanded service from municipal systems,
rural cooperatives and public power districts. As these systems have
matured, the legislature has assumed an oversight role, augmented by the
formation of the state Power Review Board in 1963.3
The sections below discuss the relative authorities and range of powers
of each type of utility system and the restrictions to which they are
subject. Table 3-1 illustrates the limitations on provision of various
types of services, especially those that may be provided by public power
districts. Table 3-2 indicates the differing range of authority each type
of system has to conduct business. Table 3-2 includes the ability to enter
into strategic alliances with private companies and service providers, an
important emerging issue.
Table 3-1: NEBRASKA UTILITY CONSUMER
SERVICES |
Service |
PPD |
Municipal |
Home Rule (1) |
Joint Action |
Distribution Co-op |
Electricity |
Yes |
Yes |
Yes |
Yes |
Yes |
Natural Gas |
No (2) |
Yes |
Yes |
Yes |
Yes |
Propane |
No (2) |
Yes |
Yes |
No (2) |
Yes |
Water & Sewer |
No (2) |
Yes |
Yes |
No (2) |
Yes |
Telecommunications |
No (2) |
(3) |
Yes |
No (2) |
Yes |
Satellite TV |
Non-cabled area |
(3) |
Yes |
No (2) |
Yes |
Cable TV |
No (2) |
(3) |
Yes |
No (2) |
Yes |
Appliance Sales & Service |
Limited |
No (2) |
(3) |
No (2) |
Yes |
Operate/Lease Energy Equipment |
Yes |
Yes |
Yes |
No (2) |
Yes |
District Heating/Cooling |
Yes |
Yes |
Yes |
Yes |
Yes |
Billing/Admin. Services |
Yes |
Yes |
Yes |
Yes |
Yes |
Home Security |
No |
(3) |
(3) |
No |
Yes |
Source: See Chapter Notes4
(1) Where "Yes" is indicated for Home Rule
Municipalities, no additional authority is needed from the state level.
Local authorization or ordinances may be necessary for those services not
currently being provided.
(2) Where "No" is indicated in any of the first four columns,
but one other of the political subdivisions in those four columns has
"Yes" indicated, or some other political subdivision in the
state has that power, the Nebraska Interlocal Cooperation Act would allow
that power to be legally exercised by the other political subdivision
through an interlocal agreement.
(3) The legal authority for municipalities to provide these services is
not clearly defined.
3.1.1 Public Power Districts
Public Power districts (PPDs) are organized under Chapter 70 of
Nebraska’s statutes.5 This law authorizes the PPDs to engage
in the generation, transmission and distribution of electric energy. They
may do so in cooperation with other PPDs, municipalities, other public
agencies or electric cooperatives. PPDs may also supply water for
irrigation and provide for flood control at their facilities, construct
and operate ethanol production facilities and provide satellite television
services in locations not served by cable television as of April 1987.
PPDs are authorized to conduct their business in other states, subject to
the limitations in the PPD’s petition for creation and the laws of the
other state.
Legislation enacted during the 1997 legislative session expanded the
powers of PPDs.6 These added powers include the ability to
engage in additional service activities for commercial and industrial
customers. They also alter the Interlocal Cooperation Act by including the
ability for PPDs to enter into contracts with municipal systems or other
political subdivisions with dissimilar powers in order to have one of the
entities exercise all or some of the powers of the other.7 This
could allow a range of services to be offered to be offered by a public
power district, provided the requirements of other restrictions are met.
As political subdivisions of the state and as public corporations, PPDs
can sue and be sued, enter into contracts, fix rates and buy, lease and
sell property. However, there are substantial limitations. They cannot
levy taxes or issue bonds secured by tax funds. They can issue tax exempt
revenue bonds to finance the construction of their facilities. Those
districts serving rural areas have access to financing through the Rural
Utilities Service. Real and personal property of the public power
districts is exempt from taxation, although they are required to pay an
in-lieu-of-tax and gross receipts tax on sales within incorporated
municipalities.
Mergers and consolidations of power districts are allowed and have
occurred on numerous occasions. A vote of the consumers of the district is
not required to undertake this action. However, votes are necessary for
other actions. With certain exceptions involving the sale of transmission
or distribution lines that extend into another power district, the sale of
surplus property, or voluntary modifications of service areas that require
the transfer of facilities to an adjoining district. For those PPDs
serving fewer than 13 counties, a majority vote of 60 percent of the
electors is required to sell, lease or transfer properties to another
district if the action is not part of a merger or consolidation. All
public power districts are prohibited by statute from selling or leasing
their property to any private person, firm or corporation engaged in the
business of selling electricity for profit.8
3.1.2 Rural Cooperatives
Rural Cooperatives may be organized under Chapter 70, Article 7 of the
state’s Nonprofit Corporation Act, Chapter 21-1901 et. seq.
Nebraska-based cooperatives are all organized under the Nonprofit
Corporation Act, except for the Nebraska Electric Generating and
Transmission Cooperative which is organized under Chapter 70. A
cooperative, other than one organized under Chapter 70, can engage in any
lawful business activity approved by their members and authorized in their
Articles of Incorporation. This may include selling other forms of energy
and providing telecommunications services, cable television and selling
and servicing residential appliances.
Mergers and consolidations of electric co-ops are clearly allowed under
state law, but must follow the procedures specified by statute. Generally,
approval of two-thirds of the members of the co-ops affected and approval
of the boards of directors is required for a plan of merger to be
approved.
Aside from being unable to legally transfer property acquired from a
public power district to a private for-profit entity, there is no
statutory restriction on the sale of a cooperative’s property to a
private for-profit corporation. However, procedures in Nebraska statutes
are required to be followed. As private corporations, the property of a
cooperative is subject to property taxes.
The comparative range of authorities of PPD’s, cooperatives and
municipal systems to conduct business is outlined in Table 3-2.
Table 3-2: NEBRASKA SYSTEMS' RANGE OF
AUTHORITY TO CONDUCT BUSINESS |
|
PPD |
Municipal |
Joint Action |
Distribution Co-op |
Merge with public system or private
company |
Public (3) |
Public |
Public |
Private |
Strategic alliance with private
company |
Yes (1) |
Yes (2) |
Yes (1) |
Yes |
Ability to own stock in private
energy company |
No |
No |
Yes (1) |
Yes |
Ability to sell assets to other
public or private utilities |
Yes (4) |
Yes |
Yes (1) |
Yes (5) |
Ability to conduct business outside
Nebraska |
Yes (6) |
Yes (7) |
Yes (9) |
Yes (8) |
Source: See Chapter Notes9
(1) Under state law, political subdivisions cannot do
indirectly that which they are not authorized to do directly. (See State
ex rel Johnson v. Consumers Public Power Dist., 143 Neb. 753, 10 N.W. 2nd
784, 152 A.L.R. 480.) MEAN is granted broad powers under Neb. Rev. Stat.
18-2441, subsection 8.
(2) Activities cannot involve lending of credit or actions that would risk
tax-exempt status.
(3) See process and limitations described in Section 3.1.2.
(4) See limitations described in Section 3.1.2.
(5) Rural Cooperatives cannot transfer property acquired from a public
power district to a private for-profit company.
(6) Subject to limitations in the PPD’s petition for creation and laws
of the other state.
(7) Limited to wholesale sales of electricity and gas, although may also
own facilities out-of-state.
(8) Broad range of activities allowable.
(9) Broad range of activities allowable.
3.1.3 Municipal Systems
Municipal systems in Nebraska are organized under the following
chapters of Nebraska’s statutes: Cities of the Metropolitan Class
(population of 300,000 or more) 14- 101 et seq. (Served by OPPD) 70-505;
Cities of the Primary Class (population of more than 100,000 but less than
300,000) 15- 101 (Served by LES); Cities of the First Class, (population
5,000 to 100,000) 16-101; Cities of the Second Class (population of more
than 800 but less than 5,000) 17-101; Villages 17-201.
Under Nebraska Statute 18-412.07, cities and villages that own and
operate electrical facilities shall have and may exercise their power and
authority to plan, finance, acquire, construct, own, operate, maintain and
improve electric generation or transmission facilities located within or
without the cities. As mentioned in Chapter 2, this authority may be
conducted by an elected or appointed board and subject to oversight from
the city or village council.
Under Nebraska Statute 18-412.08, cities and villages are empowered to
participate jointly and in cooperation with one or more electric
cooperatives or electric membership corporations in the establishment and
operation of facilities of the generation or transmission of electric
power and energy in order to achieve economics and efficiencies of scale.
When a public power district operates within the city or village, the
district is required at all times to have a valid and subsisting
franchise, either running to it as original grantee from such city or
village or assigned to it by a grantee of the city. To sell or lease
assets, a public vote may be required. If the public power district, such
as NPPD, provides the services, the facilities and property cannot be sold
to a for-profit business.
Under the Nebraska Constitution, municipal electric systems are exempt
from property taxes, but may at local discretion make in-lieu-of-tax
payments to the municipality.
3.2 JURISDICTIONAL AND REGULATORY ROLES
The requirements and powers regarding operation of the individual
systems described above are utilized by public bodies at the local, state
and federal levels. Each has specific areas of jurisdiction or overlap.
3.2.1 Local Jurisdiction and Regulation
As noted in Chapter 2, local level of government has jurisdiction and
regulatory authority over rate setting and day-to-day operations and
financing. This authority is based in the participation of
voters/consumers through their city or village councils and/or electric
board. Decisions may be made at public meetings, or through referenda
questions placed directly before voters.
3.2.2 State Jurisdiction and Regulation
State jurisdiction covers the entire range of intrastate policies and
operations, including the ability to alter local jurisdiction or
regulation. The state’s unicameral legislature follows the powers and
authorities established in the state Constitution and exercises plenary
power over the industry from formation to financing. Citizen input is
considered the legislature’s "second house" and the
legislature utilizes public hearings to facilitate this process.
The Executive branch of state government also has a wide range of
policy influence. The Governor proposes policy and legislation and
appoints directors of state agencies that regulate, assist and coordinate
the electric industry. State regulation applies largely to the formation
and intrastate operations of the electric utilities. At the state level,
the consumer-owned systems are regulated and/or assisted by the following
regulatory bodies and state agencies:
- Power Review Board (see additional information below)
- Public Service Commission (see additional information below)
- Department of Environmental Quality (see additional information
below)
- Energy Office (see additional information below)
- Department of Water Resources (oversees water permits for
generation)
- Department of Economic Development (directs policy on urban and
rural development)
3.2.2.1 Power Review Board
Of these agencies, the Power Review Board (PRB) has the most
significant impact on electric industry operations. As noted previously,
the board was created by the 1963 Legislature. Since then, regulatory
duties have been added to the board’s original mission. One of the
primary functions of the board is the certification of both retail and
wholesale service areas that designate areas utilities may serve. There
are 395 retail service area agreements and 21 wholesale service area
agreements on file at the PRB. Each file contains the written agreement
between the parties plus maps showing the outline of each service area
agreement.10
The PRB also oversees joint planning to the extent that it exists.
Nebraska law requires: "All retail power suppliers having adjoining
certified service areas shall engage in joint planning with respect to
customers, facilities and services, taking into account the considerations
specified in Nebraska Revised Statute 70-1007 (five criteria), including
the possibility that an area may be annexed by a municipality within a
reasonable period of time." As part of its joint planning function,
the PRB oversees formulation and filing of the Integrated Resource Plan by
the Nebraska Power Association.11 (See Section 4.3 for
information on the Integrated Resource Plan.)
3.2.2.2 Nebraska Public Service Commission
The Nebraska Public Service Commission (PSC) is a constitutional agency
headed by five elected commissioners. Unlike state public service
commissions in most other states, it does not have jurisdiction over
retail rate-setting for electric utilities. The PSC is responsible for
regulating telecommunications companies, grain warehouses and dealers,
private water companies, taxicab and limousine operators, intrastate
trucking companies, the adequacy of clearance of certain electric
transmission lines and railroad safety. The PSC also has limited
jurisdiction over new transmission facilities, particularly if those
facilities may interfere with its other areas of oversight such as
railroads. If utility services become increasingly bundled or packaged as
"multi-services" in the future, the role of the PSC may become
more integral to the operations of electric utilities.12
3.2.2.3 Department of Environmental Quality
The Department of Environmental Quality (DEQ) administers the rule,
regulations and standards adopted to protect and improve water, air and
land quality in the state. It includes the Water Quality Division, the Air
and Waste Management Division, the Management Services Division, the
Low-Level Radioactive Waste Program and the Environmental Quality Council.
The DEQ can have a significant impact on the state’s power industry
through its oversight of permits and air and water pollution standards.
The agency also has an especially important role in the joint regulation
(with the Department of Health and Human Services) of the disposal of
low-level radioactive waste.14
3.2.2.4 Nebraska Energy Office
The Nebraska Energy Office was first created by an executive order in
November 1973 to help respond to the energy crisis. It was a Department of
Revenue division until 1977 when it was made a separate state government
unit. It became a Governor’s Policy Research Office division in 1987.
The Energy Office has no direct oversight responsibilities relating to the
Nebraska electric systems. However, the agency’s statutory
responsibilities grant it authority to develop comprehensive emergency
energy plans, energy conservation and management strategies and long-term
resource forecasts. The Energy Office administers the state’s energy
conservation loan program and other federally mandated programs. It is
also engaged in policy-making within the state and through regional and
national organizations such as the National Governor’s Association.15
3.2.3 Judiciary
In addition to these Executive branch agencies, the state’s judicial
system also plays a role in electric utility policy and operations.
Appeals from the Power Review Board are brought to the court system,
either the Supreme Court or the Nebraska Court of Appeals. Disputes
relating to rates are generally governed by the state judicial system.
Litigation over new legislation or policies promulgated by other agencies
of the state government also may be subject to judicial review.16
3.2.4 Federal Jurisdiction and Regulation
The power and authority of the state is subject to the federal
Constitution, Congress, the Supreme Court and the requirements of federal
agencies which oversee implementation of federal law and regulations.
Federal oversight for electric utilities generally applies to wholesale
and interstate transactions, as well as to a range of environmental,
safety and finance requirements. Federal law that has had major impacts on
the electric systems in Nebraska includes:
- Securities Act of 1933
- Securities Exchange Act of 1934
- Public Utility Holding Company Act of 1935 (PUHCA)
- Federal Power Act of 1935
- Rural Electrification Act of 1936
- Reclamation Project Act of 1939
- Flood Control Act of 1944
- Clean Water Act of 1968
- National Environmental Policy Act of 1969 (NEPA)
- Clean Air Act of 1970
- Endangered Species Act of 1973
- Energy Supply and Environmental Coordination Act of 1974 (ESECA)
- DOE Organization Act of 1977
- National Energy Act of 1978
- Public Utility Regulatory Policies Act of 1978 (PURPA)
- Energy Tax Act of 1978 (ETA)
- National Energy Conservation Policy Act of 1978
- Power Plant and Industrial Fuel Use Act of 1978
- Economic Recovery Tax Act of 1991
- Nuclear Waste Policy Act of 1982
- Electric Consumer Protection Act of 1986 (ECPA)
- Tax Reform Act of 1986
- Clean Air Act Amendments of 1990 (CAAA)
- Energy Policy Act of 1992 (EPACT)
The following regulatory bodies oversee implementation of these and
other laws and regulations that impact Nebraska utilities:
- Federal Energy Regulatory Commission (FERC)
- Department of Energy (DOE)
- Environmental Protection Agency (EPA)
- Western Area Power Administration (WAPA)
- Rural Utilities Service (RUS)
- Nuclear Regulatory Commission (NRC)
- Federal Communications Commission (FCC)
- Internal Revenue Service (IRS)
- Federal Emergency Management Agency (FEMA)
- U.S. Fish and Wildlife Service (USFWS)
- Securities and Exchange Commission (SEC)
- Municipal Securities Rulemaking Board (MSRB)
3.2.5 Organizations Outside of Nebraska
that Influence Governance
In addition to federal jurisdiction and regulation, there are regional
organizations such as the Mid-Continent Power Pool (MAPP) that affect
transmission and generation availability and contract transactions in
Nebraska. As described briefly in Chapter 2, MAPP is a voluntary
organization of 60 full members, 19 associate members and six regulatory
members serving more than 16 million people in seven states and two
Canadian provinces. Its membership consists of investor utilities,
cooperatives, municipals, joint action agencies, public power districts,
independent power producers, marketers, a federal power marketing agency
and two Canadian Crown Corporations. Each segment of the industry, except
marketers and independent power producers, owns transmission in MAPP, but
no segment owns a majority of the transmission in the MAPP region.17
The role of MAPP and its policies will be increasingly important to
Nebraska utilities as competitive markets for power evolve. Chapter 6
discusses MAPP’s prospective role and possible impacts on Nebraska
utilities in more detail.
The policies of neighboring states also affect the operations and
service provided by Nebraska utilities to the extent that interstate
transmission and generation is utilized and to the extent that Nebraska
electric systems supply consumers in other states and out-of-state systems
supply Nebraska consumers. This issue is also examined in Chapter 6.
3.3 FUNDAMENTAL SERVICE AND RATE
REQUIREMENTS
State law establishes fundamental requirements for service to
consumers. These laws we parallel to laws and requirements of other states
although they my differ in application. In other states, a state
regulatory agency may oversee application of these laws. In Nebraska they
fall primarily under local jurisdiction and the implementation of the
requirements may vary by type of utility. Table 3-3 indicates the varied
policy making jurisdictions.
3.3.1 Universal Service
The term "universal service" describes a policy or goal of
providing affordable electric service "to virtually all citizens
regardless of their income." This policy is supported by common law
requirements for public utilities, federal policies and programs, state
statutory provisions and local utility policies and programs.18
Universal service requirements evolved from similar requirements for
gas companies providing residential and commercial service prior to the
advent of electric service. For electricity it took on particular
significance for rural areas. In Nebraska, the push for universal service
was largely a rural phenomenon which began in the early 1900s as rural
residents began to undertake actions for access to the benefits of
electricity which were being enjoyed by most residents of urban areas.
State policy requires: "Any supplier of electricity at retail
shall furnish service, upon application, to any applicant within the
service area of such supplier if it is economically feasible to service
and supply the applicant."19 State law also provides
authority to municipalities to establish requirements for service.20
The modern-day application of "universal service" policy can
best be gleaned from a review of the state’s electric utilities’ line
extension policies. These are the policies adopted by the local
utility’s board of directors or a city council that lay out the
conditions under which new electric service will be provided. Since the
adoption of these policies are the responsibility of the local
decision-makers, they can be tailored to fit the local conditions or the
prevailing philosophy of the local board and considerable variation in
them can be found.
Today, there are only a few rural electric systems in Nebraska that
follow the old policy of "area coverage" where electric lines
are extended to new customers at no cost to the consumer, wherever they
may wish to locate. It is very difficult to generalize regarding electric
utility line extension policies because there is a wide variation in the
approaches taken. However, they can be divided into three categories:
facilities-related, money-related and revenue-related.
Emergence of competition for retail customers could raise significant
questions regarding who is responsible for connecting customers, or for
paying the costs for connecting customers.
3.3.2 Obligation to Serve
The term "obligation to serve" refers to a responsibility or
duty imposed on electric utilities both at common law and by statute to
provide sufficient electric generation and transmission capacity to be
able to provide adequate and reliable electric service to all customers,
both retail and wholesale, within the utility’s assigned service area or
with which it has contractual relationships.
The obligation to have adequate supplies to serve all connected
customers is not a specific statutory or regulatory requirement in
Nebraska. However, public policy is clearly indicated by state statutes
that stipulate it is state policy "to provide citizens of the state
with adequate electric service at as low overall cost as possible"
and to provide "dependable electric service at lowest possible
cost."21 In a consumer-owned system it is assumed that
adequate supplies will be purchased or planned. Further, reliability and
reserve requirements of MAPP make it mandatory for members to have
adequate reserves and contingency supplies.
At the wholesale level, statutes require any Nebraska generating agency
to provide an interconnection with any distribution system desiring power.
There is also a requirement to sell power to the distribution system at
wholesale if surplus energy is available. Surplus transmission capacity
must also be made available for such transactions.22
In a competitive retail market, the requirement for adequate supplies
and reserves would need to be assigned to a "default" provider.23
There are substantial concerns that inadequate planning and a loss of
cooperation between utility systems could result in a loss of reliability
and dependable service.
3.3.3 Fair, Reasonable and
Non-Discriminatory Rates
Electric rates are generally based on cost-of-service principles. As
noted in Chapter 2, large users who are less expensive to serve generally
enjoy lower kilowatt-hour rates. Residential and rural consumers who are
more expensive to serve face higher kilowatt-hour rates. The process and
requirements for setting rates varies by type of utility system.
For public power districts and public power and irrigation districts,
Nebraska Revised Statute 70-655 requires the board of directors of a
public power district or a public power and irrigation district to set
rates which permit the district to operate in a successful and profitable
manner. It further requires that the rates set be "fair, reasonable
and nondiscriminatory and so adjusted as in a fair and equitable manner to
confer upon and distribute among the users and consumers of commodities
and services furnished or sold by the district the benefits of a
successful and profitable operation and conduct of the business of the
district." In order to stimulate economic development, a PPD may
provide discounted rates to large industrial customers for a period of
five years under the Quality Jobs Act.
Municipalities are not required by state statute
to fix fair, reasonable and non-discriminatory rates for electrical
services. Nebraska law grants to the various types of municipalities a
great deal of rate flexibility. Section 17-810 in the Nebraska Revised
Statutes allows the Board of Public Works in Second Class cities to set
rates. Statutes applicable to Cities of the First Class, Second Class and
villages are found in Section 19-1404, whereby rates are set by ordinance.
In the Lincoln Electric System’s case, the city council has adopted
PURPA’s 133 rate-making standards, which requires cost-of-service
rate-making. In addition, the Nebraska Legislature recently adopted a
provision, similar to the discretion given to the public power districts,
which allows municipalities to negotiate economic development rates under
limited circumstances.24
A cooperative organized under Chapter 70, Article
7 is required to "be operated without profit to its members, but the
rates, fees, rents or other charges for electric energy and any other
facilities, supplies, equipment, appliances or services furnished by the
corporation shall be sufficient at all times (1) to pay all operating and
maintenance expenses necessary or desirable for the prudent conduct of its
business and the principal of an interest on the obligations issued or
assumed by the corporation in the performance of the purpose for which it
was organized, and (2) for the creation of reserves." There is no
requirement in statute that the co-ops' rates be "fair, reasonable
and non-discriminatory" as required for the public power districts.
The rural distribution cooperatives organized
under the Nebraska Nonprofit Corporation Act are not subject to the
section quoted above or to the provisions which apply to public power
districts and have a great deal of flexibility in setting their rates. The
setting of rates is a matter left to the discretion of the co-op's board
of directors subject tot he provisions of Nebraska Revised Statute
70-1017.
This law applies to all electric systems,
cooperatives included, and permits a retail customer to petition the PRB
for a determination of whether the system is treating all customers fairly
and without discrimination within the same class. An appeal of the PRB's
decision may be taken to the Court of Appeals.
Table 3-3: RETAIL SERVICE AND RATE
REQUIREMENTS |
|
PPD |
Municipal |
Joint Action |
Distribution Co-op |
Fair, reasonable,
non-discriminatory rates |
State |
Local |
N/A |
Local |
Universal service |
State |
Local |
N/A |
Local |
Low-income, subsidized rates |
(1) |
Local |
N/A |
Local |
Source: See Chapter Notes25
Note: Local requirements vary depending upon the policy
decisions of local boards. State requirements provide a common standard
for each locality served. All PPDs are also required to meet the state
standard for fair, reasonable and non-discriminatory rates for wholesale
sales. Note (1) indicates that the PPDs may face a conflict with
requirements for fair, reasonable, and non-discriminatory rates with the
setting of special low-income or subsidized rates.
3.3.4 Low Income and Subsidized Rates
Most states require private investor-owned utilities to adhere to a set
of standards and practices for those customers who qualify for low-income
service. This typically includes: reduced rates, payment plans and other
services related to public assistance programs. Municipal and other public
power systems in those states are usually considered non-jurisdictional
and establish their own programs and policies regarding low-income
customers.
In Nebraska, low-income policies are locally-determined and may vary.
All systems have shut-off policies and moratoria regarding shutoff
schedules, but there is no uniform set of standards.
3.4 SUMMARY AND EMERGING ISSUES
The expansion of competitive wholesale markets and proposals for
competitive retail service pose significant impacts for statutory
frameworks and regulatory oversight. The diverse types of systems have
varied powers and restrictions that affect their ability to compete. Local
oversight my help to address local conditions and desires, but greater
uniformity with or without competition may also serve to benefit
consumers. The differences in the scope of powers and opportunities for
the systems and the need for a level playing field would likely become
exacerbated in a competitive environment. Among the fundamental questions
and issues:
- Is there a need to create more uniform standards, powers and
policies either with or without the advent of retail competition?
- To what extent would alteration in structure require changes in the
statutory and regulatory framework? For generation? For transmission?
For distribution?
- To what extent will MAPP policies and practices alter the operations
and options of Nebraska systems?
- To what extent will FERC policies and decisions alter the operations
and options of Nebraska systems?
- What would be the roles and jurisdictional authorities of the
legislature and state regulatory and planning bodies, such as the
Power Review Board?
- What would be the extent of state or local jurisdiction over out-of
state power suppliers and marketers?
- Who would have responsibility for fundamental requirements for
universal service, planning responsibility for obligation to serve all
consumers and protection of low-income consumers who may not be
desirable to competitive power marketers?
The impacts of these and other related questions require an
understanding of the current operations and planning for the Nebraska
systems, as well as the comparative efficiency and effectiveness of the
Nebraska systems described in the following chapter.
Chapter One - HISTORY
Chapter Two - STRUCTURE AND
GOVERNANCE
Chapter Three - STATUTORY AND
REGULATORY OVERSIGHT
Chapter Four - PLANNING AND
OPERATIONS
Chapter Five - FINANCE AND TAX
Chapter Six - DEREGULATION AND
RESTRUCTURING
Glossary
Chapter Notes
The Central Nebraska Public Power and
Irrigation District
415 Lincoln Street
P.O. Box 740
Holdrege, Nebraska 68949
Phone 308-995-8601 Fax 308-995-5705
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