Bill Summary
The proposed legislation, known as the "SMARTER Act" (Stop Misappropriating Ratepayer Tariffs for Excessive Resources Act), seeks to amend the Public Utility Regulatory Policies Act of 1978. Its main focus is to prohibit electric utilities from recovering costs associated with smart grid projects from ratepayers.
Key provisions of the bill include:
1. **Prohibition on Cost Recovery**: The act aims to repeal existing provisions that allow utilities to recover costs linked to smart grid systems and establishes a new standard that explicitly forbids such recovery.
2. **State Regulatory Obligations**: It mandates that state regulatory authorities must consider this prohibition within specified timeframes—starting discussions within one year of enactment and making a determination within two years.
3. **Exemptions for Prior Actions**: States that have already implemented similar standards or have taken action to consider them within the last three years will not be subject to the new time requirements.
Overall, the SMARTER Act is designed to prevent the misallocation of costs related to smart grid technologies, ensuring that ratepayers are not unfairly charged for investments in these systems.
Possible Impacts
The "SMARTER Act" proposes to amend the Public Utility Regulatory Policies Act of 1978 by prohibiting electric utilities from recovering costs associated with smart grid projects from ratepayers. Here are three examples of how this legislation could affect people:
1. **Reduced Utility Bills**: By prohibiting cost recovery for smart grid investments, consumers may benefit from lower utility bills. If electric utilities cannot pass on the costs of implementing smart grid technologies to consumers, it could reduce the overall financial burden on households and businesses, allowing them to allocate their resources to other needs.
2. **Impact on Smart Grid Development**: Utilities may be less incentivized to invest in advanced smart grid technologies due to the inability to recover costs. This could result in slower deployment of smart grid systems, which are designed to enhance energy efficiency, reliability, and sustainability. Consequently, consumers could miss out on the benefits of improved energy management and resilience that smart grids can provide.
3. **Regulatory Scrutiny and Accountability**: The legislation requires state regulatory authorities to consider and make determinations regarding the prohibition on cost recovery within specific timeframes. This could lead to increased scrutiny of utility spending and project justification, ensuring that investments made by utilities are in the public interest. However, it could also lead to delays in the implementation of necessary upgrades if regulators are overwhelmed or unable to meet the deadlines set forth in the legislation.
[Congressional Bills 119th Congress]
[From the U.S. Government Publishing Office]
[H.R. 1148 Introduced in House (IH)]
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119th CONGRESS
1st Session
H. R. 1148
To amend the Public Utility Regulatory Policies Act of 1978 to require
States to consider prohibiting cost recovery related to smart grid
projects, and for other purposes.
_______________________________________________________________________
IN THE HOUSE OF REPRESENTATIVES
February 7, 2025
Mr. Van Drew introduced the following bill; which was referred to the
Committee on Energy and Commerce
_______________________________________________________________________
A BILL
To amend the Public Utility Regulatory Policies Act of 1978 to require
States to consider prohibiting cost recovery related to smart grid
projects, and for other purposes.
Be it enacted by the Senate and House of Representatives of the
United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Stop Misappropriating Ratepayer
Tariffs for Excessive Resources Act'' or the ``SMARTER Act''.
SEC. 2. SMART GRID COST RECOVERY.
(a) Consideration and Determination Respecting Certain Ratemaking
Standards.--
(1) Repeal.--Section 111(d)(18)(B) of the Public Utility
Regulatory Policies Act of 1978 (16 U.S.C. 2621(d)(18)(B)) is
repealed.
(2) Establishment.--Section 111(d) of the Public Utility
Regulatory Policies Act of 1978 (16 U.S.C. 2621(d)) is amended
by adding at the end the following:
``(22) Prohibition on rate recovery for smart grid
investments.--No electric utility may recover from ratepayers
any capital, operating expenditure, or other costs of the
electric utility relating to the deployment of any smart grid
system.''.
(b) Obligations To Consider and Determine.--
(1) Time limitations.--Section 112(b) of the Public Utility
Regulatory Policies Act of 1978 (16 U.S.C. 2622(b)) is amended
by adding at the end the following:
``(8)(A) Not later than 1 year after the date of enactment
of this paragraph, each State regulatory authority (with
respect to each electric utility for which the State has
ratemaking authority) and each nonregulated utility shall
commence consideration under section 111, or set a hearing date
for consideration, with respect to the standard established by
paragraph (22) of section 111(d).
``(B) Not later than 2 years after the date of enactment of
this paragraph, each State regulatory authority (with respect
to each electric utility for which the State has ratemaking
authority), and each nonregulated electric utility shall
complete the consideration and make the determination under
section 111 with respect to the standard established by
paragraph (22) of section 111(d).''.
(2) Failure to comply.--Section 112(c) of the Public
Utility Regulatory Policies Act of 1978 (16 U.S.C. 2622(c)) is
amended by adding at the end the following: ``In the case of
the standard established by paragraph (22) of section 111(d),
the reference contained in this subsection to the date of
enactment of this Act shall be deemed to be a reference to the
date of enactment of that paragraph (22).''.
(3) Prior state actions.--Section 112 of the Public Utility
Regulatory Policies Act of 1978 (16 U.S.C. 2622) is amended by
adding at the end the following:
``(i) Prior State Actions.--Subsections (b) and (c) shall not apply
to the standard established by paragraph (22) of section 111(d) in the
case of any electric utility in a State if, before the date of
enactment of this subsection--
``(1) the State has implemented for the electric utility
the standard (or a comparable standard);
``(2) the State regulatory authority for the State or the
relevant nonregulated electric utility has conducted a
proceeding to consider implementation of the standard (or a
comparable standard) for the electric utility; or
``(3) the State legislature has voted on the implementation
of the standard (or a comparable standard) for the electric
utility during the 3-year period ending on that date of
enactment.''.
(c) Prior and Pending Proceedings.--Section 124 of the Public
Utility Regulatory Policies Act of 1978 (16 U.S.C. 2634) is amended by
adding at the end the following: ``In the case of the standard
established by paragraph (22) of section 111(d), the reference
contained in this section to the date of enactment of this Act shall be
deemed to be a reference to the date of enactment of that paragraph
(22).''.
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