Washington State

House of Representatives

Office of Program Research

BILL

ANALYSIS

Environment & Energy Committee

HB 1127

This analysis was prepared by non-partisan legislative staff for the use of legislative members in their deliberations. This analysis is not a part of the legislation nor does it constitute a statement of legislative intent.

Brief Summary of Bill

Authorizes the governing authority of a municipal electric utility or the commission of a public utility district to adopt an electrification of transportation plan.
Authorizes the governing authority of a municipal electric utility or the commission of a public utility district to offer incentive programs in the electrification of transportation for its customers.
Requires the Department of Commerce to arrange for a study of utility capital expenditures projected to be driven by growth in distributed resources.

Background:

Municipal Electric Utilities and Public Utility Districts.

Municipalities are authorized to operate as utilities and set the rates and charges for the provision of water, sewer, electric power, heating fuel, solid waste removal, and transportation facility services. Public utility districts (PUDs) are a type of special purpose district authorized for the purpose of generating and distributing electricity, providing water and sewer services, and providing telecommunications services. A PUD may operate on a countywide basis or may encompass a smaller jurisdiction. A PUD is governed by a board of either three or five elected commissioners.

Investor-Owned Utility Investment in Electric Vehicle Supply Equipment.

In establishing rates for privately owned gas and electrical companies, the Utilities and Transportation Commission (UTC) must consider policies to improve access to, and promote fair competition in the provision of, electric vehicle supply equipment (EVSE) build-out. These policies may include, but are not limited to, allowing a rate of return on investment on capital expenditures for EVSE that is deployed for the benefit of ratepayers, provided that the capital expenditures do not increase costs to ratepayers in excess of 0.25 percent.

A rate of return on investment for EVSE build-out may only be allowed if the company chooses to pursue capital investment in EVSE on a fully regulated basis similar to other capital investments behind a customer's meter. The incentive rate of return is established by adding an increment of up to 2 percent to the rate of return on common equity permitted on the company's other investments.

Summary of Bill:

The governing board of a municipal electric utility or public utility district may adopt an electrification of transportation plan that, at a minimum, establishes a finding that:

if the electric utility is acquiring new resources as indicated in its most recent resource plan or integrated resource plan, utility outreach and investment in the electrification of transportation infrastructure is cost-effective, as determined using a methodology that assesses both the expected system benefits and expected costs to ratepayers; or
if the electric utility is not acquiring new resources, utility outreach and investment in the electrification of transportation infrastructure is cost-effective, as determined using a methodology that assesses both the expected system benefits and expected costs to ratepayers and the long-term contracted wholesale electricity supply that will result in a greater ratepayer benefit than the individual benefit from the program cost.

In adopting an electrification of transportation plan, a governing board may consider some or all of the following:

the applicability of multiple options for electrification of transportation across all customer classes;
the impact of electrification on the utility's load;
system reliability and distribution system efficiencies;
interoperability concerns; and
overall customer experience.

The governing board may, upon making a cost-effectiveness determination, offer incentive programs in the electrification of transportation for its customers.

The Department of Commerce, subject to appropriations, must arrange for a study of utility capital expenditures projected to be driven by growth in distributed resources, including photovoltaic systems, electric vehicles, and any other customer-owned technologies identified as likely to cause a shift in capital expenditures. The study must survey each of the state's utilities and must include a low and high adoption scenario for each resource.