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To amend the Department of Energy Authorization Act to authorize the Secretary of Energy to impose interim limitations on the cost of electric energy to protect consumers from unjust and unreasonable prices in the electric energy market.

January 22, 2001

Mrs. FEINSTEIN (for herself and Mrs. BOXER) introduced the following bill; which was read twice and referred to the Committee on Energy and Natural Resources

To amend the Department of Energy Authorization Act to authorize the Secretary of Energy to impose interim limitations on the cost of electric energy to protect consumers from unjust and unreasonable prices in the electric energy market.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. INTERIM REGIONAL LIMITATIONS.

Title IV of the Department of Energy Organization Act (42 U.S.C. 7171 et seq.) is amended by adding at the end the following:

`SEC. 408. INTERIM REGIONAL LIMITATIONS.

`(a) DEFINITIONS- In this section:

`(1) COMMISSION- The term `Commission' means the Federal Energy Regulatory Commission.

`(2) COST-OF-SERVICE BASED RATE- The term `cost-of-service based rate' means a rate, charge, or classification for the sale of electric energy that is equal to--

`(A) all the variable and fixed costs for producing the electric energy; and

`(B) a return on and of any invested capital.

`(3) INTERIM REGIONAL PRICE LIMITATION- The term `interim regional price limitation' means a price limitation on the rates charged for the provision of electric energy that--

`(A) includes a region-wide wholesale electric energy price limitation for a region comprising the Western Systems Coordinating Council; and

`(B) reflects load differentiated demand.

`(4) LOAD DIFFERENTIATED- The term `load differentiated' means the difference between price limitations by season, time of day, and other relevant usage patterns.

`(5) SECRETARY- The term `Secretary' means the Secretary of Energy.

`(b) AUTHORITY TO IMPOSE LIMITATIONS- The Secretary shall impose, in any region of the United States, an interim regional price limitation, or cost-of-service based rate, on any sale of electric energy at wholesale rate in interstate commerce subject to the jurisdiction of the Commission under part II of the Federal Power Act whenever--

`(1) the Commission has determined that the rate, charge, or classification otherwise applicable to such sale is unjust, unreasonable, or unduly preferential or the Secretary determines that the rate, charge, or classification otherwise applicable to such sale exceeds the marginal cost of producing the electric energy by a significant amount or for a significant length of time; and

`(2) the Secretary determines that--

`(A) the continued existence of such rate, charge, or classification threatens public health and safety or the economy of any State or region; and

`(B) the Commission has otherwise failed to act to improve the situation.

For purposes of carrying out this section, the Secretary may exercise any authority vested in the Commission under the Federal Power Act for the fixing and enforcing of rates, charges, and classifications that are just and reasonable under Part II of that Act.

`(c) DURATION- A regional price limitation or cost-of-service based rate imposed under subsection (b) shall remain in effect until such time as the market reflects just and reasonable rates, as determined by the Secretary.

`(d) AUTHORITY TO OPT OUT-

`(1) IN GENERAL- The Governor of any State within a region in which a regional price limitation or cost-of-service based rate is imposed under subsection (b) may waive the application of such limitation or rate to sales of electric energy to purchasers in that State by notifying the Secretary in writing at any time after imposition of the price limitation or cost-of-service based rate.

`(2) EFFECTIVE DATE- Not later than 30 days after receiving a letter from a Governor of any State under paragraph (1), the Secretary shall waive the application of the price limitation or cost-of-service based rate to sales of electric energy to purchasers in that State.

`(e) PURPA FACILITIES NOT COVERED- The authority of subsection (b) shall not apply to any sale of electric energy generated by a qualifying small power production facility or qualifying cogeneration facility (as defined in section 3 of the Federal Power Act) that is exempt in whole or in part from the Federal Power Act as provided in section 210(e) of the Public Utility Regulatory Policies Act of 1978.

`(f) EFFECT ON OTHER LAW- Nothing in this section affects any authority of the Commission under the Federal Power Act (16 U.S.C. 791a et seq.) with respect to sales of electric energy forwhich no determination has been made under subsection (b).

`(g) EFFECTIVE DATE- This section shall apply to contracts for the sale of electric energy entered into or renewed after the enactment of this section.'.

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