Bill Text: IL HB0690 | 2011-2012 | 97th General Assembly | Amended

---

Bill Title: Amends the Public Utilities Act. Makes a technical change in a Section concerning investments in rate base.

Spectrum: Bipartisan Bill

Status: (Failed) 2013-01-08 - Session Sine Die [HB0690 Detail]

Download: Illinois-2011-HB0690-Amended.html

---

Rep. Kevin A. McCarthy

Filed: 10/25/2011

09700HB0690ham001 LRB097 03518 CEL 59067 a
AMENDMENT TO HOUSE BILL 690
AMENDMENT NO. ______. Amend House Bill 690 by replacing
everything after the enacting clause with the following:
"Section 1. Findings. The General Assembly finds that:
(1) subsection (b-10) of Section 16-108.5 of this
amendatory Act of the 97th General Assembly provides
substantial customer assistance programs for low-income
customers, senior citizens, active members of the armed
services and reserved forces, and disabled veterans;
(2) subsection (b) of Section 16-108.5 of this
amendatory Act of the 97th General Assembly provides for
infrastructure improvements designed to reduce outages due
to storms;
(3) subsections (f) and (f-5) of Section 16-108.5 of
this amendatory Act of the 97th General Assembly require
improvement in a variety of performance metrics and impose
penalties on the electric utilities for failure to achieve

09700HB0690ham001 - 2 - LRB097 03518 CEL 59067 a
the statutorily set goals;
(4) Black & Veatch, a global engineering, consulting
and construction company, performed an independent
evaluation of Commonwealth Edison Company's Advanced
Metering Infrastructure ("AMI") pilot program and
concluded that the cost savings and benefits to ComEd
customers of full AMI deployment are nearly 3 times greater
than the cost to deploy AMI, and further that AMI
deployment is estimated to result in a net savings to ComEd
customers of $2.8 billion over 20 years; and
(5) this amendatory Act of the 97th General Assembly
confers substantial benefits upon the State's electric
utility customers.
Section 5. If and only if Senate Bill 1652 of the 97th
General Assembly becomes law, then the Public Utilities Act is
amended by changing Section 16-107.5, 16-108.5, 16-108.6,
16-108.7, and 16-128 as follows:
(220 ILCS 5/16-107.5)
Sec. 16-107.5. Net electricity metering.
(a) The Legislature finds and declares that a program to
provide net electricity metering, as defined in this Section,
for eligible customers can encourage private investment in
renewable energy resources, stimulate economic growth, enhance
the continued diversification of Illinois' energy resource

09700HB0690ham001 - 3 - LRB097 03518 CEL 59067 a
mix, and protect the Illinois environment.
(b) As used in this Section, (i) "eligible customer" means
a retail customer that owns or operates a solar, wind, or other
eligible renewable electrical generating facility with a rated
capacity of not more than 2,000 kilowatts that is located on
the customer's premises and is intended primarily to offset the
customer's own electrical requirements; (ii) "electricity
provider" means an electric utility or alternative retail
electric supplier; (iii) "eligible renewable electrical
generating facility" means a generator powered by solar
electric energy, wind, dedicated crops grown for electricity
generation, agricultural residues, untreated and unadulterated
wood waste, landscape trimmings, livestock manure, anaerobic
digestion of livestock or food processing waste, fuel cells or
microturbines powered by renewable fuels, or hydroelectric
energy; and (iv) "net electricity metering" (or "net metering")
means the measurement, during the billing period applicable to
an eligible customer, of the net amount of electricity supplied
by an electricity provider to the customer's premises or
provided to the electricity provider by the customer.
(c) A net metering facility shall be equipped with metering
equipment that can measure the flow of electricity in both
directions at the same rate.
(1) For eligible customers whose electric service has
not been declared competitive pursuant to Section 16-113 of
this Act and whose electric delivery service is provided

09700HB0690ham001 - 4 - LRB097 03518 CEL 59067 a
and measured on a kilowatt-hour basis and electric supply
service is not provided based on hourly pricing, this shall
typically be accomplished through use of a single,
bi-directional meter. If the eligible customer's existing
electric revenue meter does not meet this requirement, the
electricity provider shall arrange for the local electric
utility or a meter service provider to install and maintain
a new revenue meter at the electricity provider's expense.
(2) For eligible customers whose electric service has
not been declared competitive pursuant to Section 16-113 of
this Act and whose electric delivery service is provided
and measured on a kilowatt demand basis and electric supply
service is not provided based on hourly pricing, this shall
typically be accomplished through use of a dual channel
meter capable of measuring the flow of electricity both
into and out of the customer's facility at the same rate
and ratio. If such customer's existing electric revenue
meter does not meet this requirement, then the electricity
provider shall arrange for the local electric utility or a
meter service provider to install and maintain a new
revenue meter at the electricity provider's expense.
(3) For all other eligible customers, the electricity
provider may arrange for the local electric utility or a
meter service provider to install and maintain metering
equipment capable of measuring the flow of electricity both
into and out of the customer's facility at the same rate

09700HB0690ham001 - 5 - LRB097 03518 CEL 59067 a
and ratio, typically through the use of a dual channel
meter. If the eligible customer's existing electric
revenue meter does not meet this requirement, then the
costs of installing such equipment shall be paid for by the
customer.
(d) An electricity provider shall measure and charge or
credit for the net electricity supplied to eligible customers
or provided by eligible customers whose electric service has
not been declared competitive pursuant to Section 16-113 of the
Act and whose electric delivery service is provided and
measured on a kilowatt-hour basis and electric supply service
is not provided based on hourly pricing in the following
manner:
(1) If the amount of electricity used by the customer
during the billing period exceeds the amount of electricity
produced by the customer, the electricity provider shall
charge the customer for the net electricity supplied to and
used by the customer as provided in subsection (e-5) of
this Section.
(2) If the amount of electricity produced by a customer
during the billing period exceeds the amount of electricity
used by the customer during that billing period, the
electricity provider supplying that customer shall apply a
1:1 kilowatt-hour credit to a subsequent bill for service
to the customer for the net electricity supplied to the
electricity provider. The electricity provider shall

09700HB0690ham001 - 6 - LRB097 03518 CEL 59067 a
continue to carry over any excess kilowatt-hour credits
earned and apply those credits to subsequent billing
periods to offset any customer-generator consumption in
those billing periods until all credits are used or until
the end of the annualized period.
(3) At the end of the year or annualized over the
period that service is supplied by means of net metering,
or in the event that the retail customer terminates service
with the electricity provider prior to the end of the year
or the annualized period, any remaining credits in the
customer's account shall expire.
(d-5) An electricity provider shall measure and charge or
credit for the net electricity supplied to eligible customers
or provided by eligible customers whose electric service has
not been declared competitive pursuant to Section 16-113 of
this Act and whose electric delivery service is provided and
measured on a kilowatt-hour basis and electric supply service
is provided based on hourly pricing in the following manner:
(1) If the amount of electricity used by the customer
during any hourly period exceeds the amount of electricity
produced by the customer, the electricity provider shall
charge the customer for the net electricity supplied to and
used by the customer according to the terms of the contract
or tariff to which the same customer would be assigned to
or be eligible for if the customer was not a net metering
customer.

09700HB0690ham001 - 7 - LRB097 03518 CEL 59067 a
(2) If the amount of electricity produced by a customer
during any hourly period exceeds the amount of electricity
used by the customer during that hourly period, the energy
provider shall apply a credit for the net kilowatt-hours
produced in such period. The credit shall consist of an
energy credit and a delivery service credit. The energy
credit shall be valued at the same price per kilowatt-hour
as the electric service provider would charge for
kilowatt-hour energy sales during that same hourly period.
The delivery credit shall be equal to the net
kilowatt-hours produced in such hourly period times a
credit that reflects all kilowatt-hour based charges in the
customer's electric service rate, excluding energy
charges.
(e) An electricity provider shall measure and charge or
credit for the net electricity supplied to eligible customers
whose electric service has not been declared competitive
pursuant to Section 16-113 of this Act and whose electric
delivery service is provided and measured on a kilowatt demand
basis and electric supply service is not provided based on
hourly pricing in the following manner:
(1) If the amount of electricity used by the customer
during the billing period exceeds the amount of electricity
produced by the customer, then the electricity provider
shall charge the customer for the net electricity supplied
to and used by the customer as provided in subsection (e-5)

09700HB0690ham001 - 8 - LRB097 03518 CEL 59067 a
of this Section, provided that the electricity provider
shall assess and the customer remains responsible for all
taxes, fees, and utility delivery charges that would
otherwise be applicable to the gross amount of
kilowatt-hours supplied to the eligible customer by the
electricity provider.
(2) If the amount of electricity produced by a customer
during the billing period exceeds the amount of electricity
used by the customer during that billing period, then the
electricity provider supplying that customer shall apply a
1:1 kilowatt-hour credit that reflects the kilowatt-hour
based charges in the customer's electric service rate to a
subsequent bill for service to the customer for the net
electricity supplied to the electricity provider. The
electricity provider shall continue to carry over any
excess kilowatt-hour credits earned and apply those
credits to subsequent billing periods to offset any
customer-generator consumption in those billing periods
until all credits are used or until the end of the
annualized period.
(3) At the end of the year or annualized over the
period that service is supplied by means of net metering,
or in the event that the retail customer terminates service
with the electricity provider prior to the end of the year
or the annualized period, any remaining credits in the
customer's account shall expire.

09700HB0690ham001 - 9 - LRB097 03518 CEL 59067 a
(e-5) An electricity provider shall provide electric
service to eligible customers whose electric service has not
been declared competitive pursuant to Section 16-113 of this
Act and whose electric supply service is not provided based on
hourly pricing who utilize net metering at non-discriminatory
rates that are identical, with respect to rate structure,
retail rate components, and any monthly charges, to the rates
that the customer would be charged if not a net metering
customer. An electricity provider shall not charge net metering
customers any fee or charge or require additional equipment,
insurance, or any other requirements not specifically
authorized by interconnection standards authorized by the
Commission, unless the fee, charge, or other requirement would
apply to other similarly situated customers who are not net
metering customers. The customer will remain responsible for
all taxes, fees, and utility delivery charges that would
otherwise be applicable to the net amount of electricity used
by the customer. Subsections (c) through (e) of this Section
shall not be construed to prevent an arms-length agreement
between an electricity provider and an eligible customer that
sets forth different prices, terms, and conditions for the
provision of net metering service, including, but not limited
to, the provision of the appropriate metering equipment for
non-residential customers.
(f) Notwithstanding the requirements of subsections (c)
through (e-5) of this Section, an electricity provider must

09700HB0690ham001 - 10 - LRB097 03518 CEL 59067 a
require dual-channel metering for customers operating eligible
renewable electrical generating facilities with a nameplate
rating up to 2,000 kilowatts and to whom the provisions of
neither subsection (d), (d-5), nor (e) of this Section apply.
In such cases, electricity charges and credits shall be
determined as follows:
(1) The electricity provider shall assess and the
customer remains responsible for all taxes, fees, and
utility delivery charges that would otherwise be
applicable to the gross amount of kilowatt-hours supplied
to the eligible customer by the electricity provider.
(2) Each month that service is supplied by means of
dual-channel metering, the electricity provider shall
compensate the eligible customer for any excess
kilowatt-hour credits at the electricity provider's
avoided cost of electricity supply over the monthly period
or as otherwise specified by the terms of a power-purchase
agreement negotiated between the customer and electricity
provider.
(3) For all eligible net metering customers taking
service from an electricity provider under contracts or
tariffs employing time of use rates, any monthly
consumption of electricity shall be calculated according
to the terms of the contract or tariff to which the same
customer would be assigned to or be eligible for if the
customer was not a net metering customer. When those same

09700HB0690ham001 - 11 - LRB097 03518 CEL 59067 a
customer-generators are net generators during any discrete
time of use period, the net kilowatt-hours produced shall
be valued at the same price per kilowatt-hour as the
electric service provider would charge for retail
kilowatt-hour sales during that same time of use period.
(g) For purposes of federal and State laws providing
renewable energy credits or greenhouse gas credits, the
eligible customer shall be treated as owning and having title
to the renewable energy attributes, renewable energy credits,
and greenhouse gas emission credits related to any electricity
produced by the qualified generating unit. The electricity
provider may not condition participation in a net metering
program on the signing over of a customer's renewable energy
credits; provided, however, this subsection (g) shall not be
construed to prevent an arms-length agreement between an
electricity provider and an eligible customer that sets forth
the ownership or title of the credits.
(h) Within 120 days after the effective date of this
amendatory Act of the 95th General Assembly, the Commission
shall establish standards for net metering and, if the
Commission has not already acted on its own initiative,
standards for the interconnection of eligible renewable
generating equipment to the utility system. The
interconnection standards shall address any procedural
barriers, delays, and administrative costs associated with the
interconnection of customer-generation while ensuring the

09700HB0690ham001 - 12 - LRB097 03518 CEL 59067 a
safety and reliability of the units and the electric utility
system. The Commission shall consider the Institute of
Electrical and Electronics Engineers (IEEE) Standard 1547 and
the issues of (i) reasonable and fair fees and costs, (ii)
clear timelines for major milestones in the interconnection
process, (iii) nondiscriminatory terms of agreement, and (iv)
any best practices for interconnection of distributed
generation.
(i) All electricity providers shall begin to offer net
metering no later than April 1, 2008.
(j) An electricity provider shall provide net metering to
eligible customers until the load of its net metering customers
equals 5% of the total peak demand supplied by that electricity
provider during the previous year. Electricity providers are
authorized to offer net metering beyond the 5% level if they so
choose.
(k) Each electricity provider shall maintain records and
report annually to the Commission the total number of net
metering customers served by the provider, as well as the type,
capacity, and energy sources of the generating systems used by
the net metering customers. Nothing in this Section shall limit
the ability of an electricity provider to request the redaction
of information deemed by the Commission to be confidential
business information. Each electricity provider shall notify
the Commission when the total generating capacity of its net
metering customers is equal to or in excess of the 5% cap

09700HB0690ham001 - 13 - LRB097 03518 CEL 59067 a
specified in subsection (j) of this Section.
(l) Notwithstanding the definition of "eligible customer"
in item (i) of subsection (b) of this Section, each electricity
provider shall consider whether to allow meter aggregation for
the purposes of net metering on:
(1) properties owned or leased by multiple customers
that contribute to the operation of an eligible renewable
electrical generating facility, such as a community-owned
wind project, a community-owned biomass project, a
community-owned solar project, or a community methane
digester processing livestock waste from multiple sources;
and
(2) individual units, apartments, or properties owned
or leased by multiple customers and collectively served by
a common eligible renewable electrical generating
facility, such as an apartment building served by
photovoltaic panels on the roof.
For the purposes of this subsection (l), "meter
aggregation" means the combination of reading and billing on a
pro rata basis for the types of eligible customers described in
this Section.
(m) Nothing in this Section shall affect the right of an
electricity provider to continue to provide, or the right of a
retail customer to continue to receive service pursuant to a
contract for electric service between the electricity provider
and the retail customer in accordance with the prices, terms,

09700HB0690ham001 - 14 - LRB097 03518 CEL 59067 a
and conditions provided for in that contract. Either the
electricity provider or the customer may require compliance
with the prices, terms, and conditions of the contract.
(Source: P.A. 95-420, eff. 8-24-07; 09700SB1652enr.)
(220 ILCS 5/16-108.5)
Sec. 16-108.5. Infrastructure investment and
modernization; regulatory reform.
(a) (Blank). The General Assembly recognizes that for well
over a century Illinois residents and businesses have been
well-served by and have benefitted from a comprehensive
electric utility system. The General Assembly finds that
electric utilities are now entering a new construction cycle
that is needed to refurbish, rebuild, modernize, and expand
systems to continue to provide safe, reliable, and affordable
service to the State's current and future utility customers in
this newly digitized age. In particular, the General Assembly
finds that it is the policy of this State that significant
investments must be made in the State's electric grid over the
next decade to modernize and upgrade transmission and
distribution facilities in the State. These investments will
ensure that the State's electric utility infrastructure will
promote future economic development in the State and that the
State's electric utilities will be able to continue to provide
quality electric service to their customers, including
innovative technological offerings that will enhance customer

09700HB0690ham001 - 15 - LRB097 03518 CEL 59067 a
experience and choice such as smart meters that are dependent
on a modernized or Smart Grid. These investments, including
programs to reinforce the safety and security of high voltage
transmission lines, will also ensure that the State's electric
utility infrastructure continues to be safe and reliable. The
introduction of performance metrics will further ensure that
reliability and other indicators are not just maintained but
improved over the next decade.
The General Assembly further recognizes that, in addition
to attracting capital and businesses to the State, these
investments will create training opportunities for the
citizens of this State, all of which will create new employment
opportunities for Illinoisans at a time when they are most
needed, especially for minority-owned and female-owned
business enterprises. The General Assembly further finds that
regulatory reform measures that increase predictability,
stability, and transparency in the ratemaking process are
needed to promote prudent, long-term infrastructure investment
and to mutually benefit the State's electric utilities and
their customers, regulators, and investors.
(b) For purposes of this Section, "participating utility"
means an electric utility or a combination utility serving more
than 1,000,000 customers in Illinois that voluntarily elects
and commits to undertake (i) the infrastructure investment
program consisting of the commitments and obligations
described in this subsection (b) and (ii) the customer

09700HB0690ham001 - 16 - LRB097 03518 CEL 59067 a
assistance program consisting of the commitments and
obligations described in subsection (b-10) of this Section,
notwithstanding any other provisions of this Act and without
obtaining any approvals from the Commission or any other agency
other than as set forth in this Section, regardless of whether
any such approval would otherwise be required. "Combination
utility" means a utility that, as of January 1, 2011, provided
electric service to at least one million retail customers in
Illinois and gas service to at least 500,000 retail customers
in Illinois. A participating utility shall recover the
expenditures made under the infrastructure investment program
through the ratemaking process, including, but not limited to,
the performance-based formula rate and process set forth in
this Section.
During the infrastructure investment program's peak
program year, a participating utility other than a combination
utility shall create 2,000 full-time equivalent jobs in
Illinois, and a participating utility that is a combination
utility shall create 450 full-time equivalent jobs in Illinois
related to the provision of electric service. These jobs shall
include , including direct jobs, contractor positions, and
induced jobs, but shall not include any portion of a job
commitment, not specifically contingent on an amendatory Act of
the 97th General Assembly becoming law, between a participating
utility and a labor union that existed on the effective date of
this amendatory Act of the 97th General Assembly and that has

09700HB0690ham001 - 17 - LRB097 03518 CEL 59067 a
not yet been fulfilled. A portion of the full-time equivalent
jobs created by each participating utility shall include
incremental personnel hired subsequent to the effective date of
this amendatory Act of the 97th General Assembly. For purposes
of this Section, "peak program year" means the consecutive
12-month period with the highest number of full-time equivalent
jobs that occurs between the beginning of investment year 2 and
the end of investment year 4.
A participating utility shall meet one of the following
commitments, as applicable:
(1) Beginning no later than 180 days after a
participating utility other than a combination utility
files a performance-based formula rate tariff pursuant to
subsection (c) of this Section, or, beginning no later than
January 1, 2012 if such utility files such
performance-based formula rate tariff within 14 days of the
effective date of this amendatory Act of the 97th General
Assembly, the participating utility shall, except as
provided in subsection (b-5):
(A) over a 5-year period, invest an estimated
$1,300,000,000 $1,100,000,000 in electric system
upgrades, modernization projects, and training
facilities, including, but not limited to:
(i) distribution infrastructure improvements
totaling an estimated $1,000,000,000, including
underground residential distribution cable

09700HB0690ham001 - 18 - LRB097 03518 CEL 59067 a
injection and replacement and mainline cable
system refurbishment and replacement projects;
(ii) training facility construction or upgrade
projects totaling an estimated $10,000,000,
provided that, at a minimum, one such facility
shall be located in a municipality having a
population of more than 2 million residents and one
such facility shall be located in a municipality
having a population of more than 150,000 residents
but fewer than 170,000 residents; any such new
facility located in a municipality having a
population of more than 2 million residents must be
designed for the purpose of obtaining, and the
owner of the facility shall apply for,
certification under the United States Green
Building Council's Leadership in Energy Efficiency
Design Green Building Rating System; and
(iii) wood pole inspection, treatment, and
replacement programs; and
(iv) an estimated $200,000,000 for reducing
the susceptibility of certain circuits to
storm-related damage, including, but not limited
to, high winds, thunderstorms, and ice storms;
improvements may include, but are not limited to,
overhead to underground conversion and other
engineered outcomes for circuits; the

09700HB0690ham001 - 19 - LRB097 03518 CEL 59067 a
participating utility shall prioritize the
selection of circuits based on each circuit's
historical susceptibility to storm-related damage
and the ability to provide the greatest customer
benefit upon completion of the improvements; to be
eligible for improvement, the participating
utility's ability to maintain proper tree
clearances surrounding the overhead circuit must
not have been impeded by third parties; and
(B) over a 10-year period, invest an estimated
$1,300,000,000 $1,500,000,000 to upgrade and modernize
its transmission and distribution infrastructure and
in Smart Grid electric system upgrades, including, but
not limited to:
(i) additional smart meters;
(ii) distribution automation;
(iii) associated cyber secure data
communication network; and
(iv) substation micro-processor relay
upgrades.
(2) Beginning no later than 180 days after a
participating utility that is a combination utility files a
performance-based formula rate tariff pursuant to
subsection (c) of this Section, or, beginning no later than
January 1, 2012 if such utility files such
performance-based formula rate tariff within 14 days of the

09700HB0690ham001 - 20 - LRB097 03518 CEL 59067 a
effective date of this amendatory Act of the 97th General
Assembly, the participating utility shall, except as
provided in subsection (b-5):
(A) over a 10-year period, invest an estimated
$265,000,000 in electric system upgrades,
modernization projects, and training facilities,
including, but not limited to:
(i) distribution infrastructure improvements
totaling an estimated $245,000,000, which may
include bulk supply substations, transformers,
reconductoring, and rebuilding overhead
distribution and sub-transmission lines,
underground residential distribution cable
injection and replacement and mainline cable
system refurbishment and replacement projects;
(ii) training facility construction or upgrade
projects totaling an estimated $1,000,000; any
such new facility must be designed for the purpose
of obtaining, and the owner of the facility shall
apply for, certification under the United States
Green Building Council's Leadership in Energy
Efficiency Design Green Building Rating System;
and
(iii) wood pole inspection, treatment, and
replacement programs; and
(B) over a 10-year period, invest an estimated

09700HB0690ham001 - 21 - LRB097 03518 CEL 59067 a
$360,000,000 to upgrade and modernize its transmission
and distribution infrastructure and in Smart Grid
electric system upgrades, including, but not limited
to:
(i) additional smart meters;
(ii) distribution automation;
(iii) associated cyber secure data
communication network; and
(iv) substation micro-processor relay
upgrades.
For purposes of this Section, "Smart Grid electric system
upgrades" shall have the meaning set forth in subsection (a) of
Section 16-108.6 of this Act.
The investments in the infrastructure investment program
described in this subsection (b) shall be incremental to the
participating utility's annual capital investment program, as
defined by, for purposes of this subsection (b), the
participating utility's average capital spend for calendar
years 2008, 2009, and 2010 as reported in the applicable
Federal Energy Regulatory Commission (FERC) Form 1; provided
that where one or more utilities have merged, the average
capital spend shall be determined using the aggregate of the
merged utilities' capital spend reported in FERC Form 1 for the
years 2008, 2009, and 2010. A participating utility may add
reasonable construction ramp-up and ramp-down time to the
investment periods specified in this subsection (b). For each

09700HB0690ham001 - 22 - LRB097 03518 CEL 59067 a
such investment period, the ramp-up and ramp-down time shall
not exceed a total of 6 months.
Within 60 days after filing a tariff under subsection (c)
of this Section, a participating utility shall submit to the
Commission its plan, including scope, schedule, and staffing,
for satisfying its infrastructure investment program
commitments pursuant to this subsection (b). The submitted plan
shall include a schedule and staffing plan for the next
calendar year. The plan shall also include a plan for the
creation, operation, and administration of a Smart Grid test
bed as described in subsection (c) of Section 16-108.8. The
plan need not allocate the work equally over the respective
periods, but should allocate material increments throughout
such periods commensurate with the work to be undertaken. No
later than April 1 of each subsequent year, the utility shall
submit to the Commission a report that includes any updates to
the plan, a schedule for the next calendar year, the
expenditures made for the prior calendar year and cumulatively,
and the number of full-time equivalent jobs created for the
prior calendar year and cumulatively. If the utility is
materially deficient in satisfying a schedule or staffing plan,
then the report must also include a corrective action plan to
address the deficiency. The fact that the plan, implementation
of the plan, or a schedule changes shall not imply the
imprudence or unreasonableness of the infrastructure
investment program, plan, or schedule. Further, no later than

09700HB0690ham001 - 23 - LRB097 03518 CEL 59067 a
45 days following the last day of the first, second, and third
quarters of each year of the plan, a participating utility
shall submit to the Commission a verified quarterly report for
the prior quarter that includes (i) the total number of
full-time equivalent jobs created during the prior quarter,
(ii) the total number of employees as of the last day of the
prior quarter, (iii) the total number of full-time equivalent
hours in each job classification or job title, (iv) the total
number of incremental employees and contractors in support of
the investments undertaken pursuant to this subsection (b) for
the prior quarter, and (v) any other information that the
Commission may require by rule.
With respect to the participating utility's peak job
commitment, if, after considering the utility's corrective
action plan and compliance thereunder, the Commission enters an
order finding, after notice and hearing, that a participating
utility did not satisfy its peak job commitment described in
this subsection (b) for reasons that are reasonably within its
control, then the Commission shall also determine, after
consideration of the evidence, including, but not limited to,
evidence submitted by the Department of Commerce and Economic
Opportunity and the utility, the deficiency in the number of
full-time equivalent jobs during the peak program year due to
such failure. The Commission shall notify the Department of any
proceeding that is initiated pursuant to this paragraph. For
each full-time equivalent job deficiency during the peak

09700HB0690ham001 - 24 - LRB097 03518 CEL 59067 a
program year that the Commission finds as set forth in this
paragraph, the participating utility shall, within 30 days
after the entry of the Commission's order, pay $6,000 $3,000 to
a fund for training grants administered under Section 605-800
of The Department of Commerce and Economic Opportunity Law,
which shall not be a recoverable expense.
With respect to the participating utility's investment
amount commitments, if, after considering the utility's
corrective action plan and compliance thereunder, the
Commission enters an order finding, after notice and hearing,
that a participating utility is not satisfying its investment
amount commitments described in this subsection (b), then the
utility shall no longer be eligible to annually update the
performance-based formula rate tariff pursuant to subsection
(d) of this Section. In such event, the then current rates
shall remain in effect until such time as new rates are set
pursuant to Article IX of this Act, subject to retroactive
adjustment, with interest, to reconcile rates charged with
actual costs.
If the Commission finds that a participating utility is no
longer eligible to update the performance-based formula rate
tariff pursuant to subsection (d) of this Section, or the
performance-based formula rate is otherwise terminated, then
the participating utility's voluntary commitments and
obligations under this subsection (b) shall immediately
terminate, except for the utility's obligation to pay an amount

09700HB0690ham001 - 25 - LRB097 03518 CEL 59067 a
already owed to the fund for training grants pursuant to a
Commission order.
In meeting the obligations of this subsection (b), to the
extent feasible and consistent with State and federal law, the
investments under the infrastructure investment program should
provide employment opportunities for all segments of the
population and workforce, including minority-owned and
female-owned business enterprises, and shall not, consistent
with State and federal law, discriminate based on race or
socioeconomic status.
(b-5) Nothing in this Section shall prohibit the Commission
from investigating the prudence and reasonableness of the
expenditures made under the infrastructure investment program
during the annual review required by subsection (d) of this
Section and shall, as part of such investigation, determine
whether the utility's actual costs under the program are
prudent and reasonable. The fact that a participating utility
invests more than the minimum amounts specified in subsection
(b) of this Section or its plan shall not imply imprudence or
unreasonableness.
If the participating utility finds that it is implementing
its plan for satisfying the infrastructure investment program
commitments described in subsection (b) of this Section at a
cost below the estimated amounts specified in subsection (b) of
this Section, then the utility may file a petition with the
Commission requesting that it be permitted to satisfy its

09700HB0690ham001 - 26 - LRB097 03518 CEL 59067 a
commitments by spending less than the estimated amounts
specified in subsection (b) of this Section. The Commission
shall, after notice and hearing, enter its order approving, or
approving as modified, or denying each such petition within 150
days after the filing of the petition.
In no event, absent General Assembly approval, shall the
capital investment costs incurred by a participating utility
other than a combination utility in satisfying its
infrastructure investment program commitments described in
subsection (b) of this Section exceed $3,000,000,000 or, for a
participating utility that is a combination utility,
$720,000,000. If the participating utility's updated cost
estimates for satisfying its infrastructure investment program
commitments described in subsection (b) of this Section exceed
the limitation imposed by this subsection (b-5), then it shall
submit a report to the Commission that identifies the increased
costs and explains the reason or reasons for the increased
costs no later than the year in which the utility estimates it
will exceed the limitation. The Commission shall review the
report and shall, within 90 days after the participating
utility files the report, report to the General Assembly its
findings regarding the participating utility's report. If the
General Assembly does not amend the limitation imposed by this
subsection (b-5), then the utility may modify its plan so as
not to exceed the limitation imposed by this subsection (b-5)
and may propose corresponding changes to the metrics

09700HB0690ham001 - 27 - LRB097 03518 CEL 59067 a
established pursuant to subparagraphs (5) through (8) of
subsection (f) of this Section, and the Commission may modify
the metrics and incremental savings goals established pursuant
to subsection (f) of this Section accordingly.
(b-10) All participating utilities shall make
contributions for an energy low-income and support program in
accordance with this subsection. Beginning no later than 180
days after a participating utility files a performance-based
formula rate tariff pursuant to subsection (c) of this Section,
or beginning no later than January 1, 2012 if such utility
files such performance-based formula rate tariff within 14 days
of the effective date of this amendatory Act of the 97th
General Assembly, and without obtaining any approvals from the
Commission or any other agency other than as set forth in this
Section, regardless of whether any such approval would
otherwise be required, a participating utility other than a
combination utility shall pay $10,000,000 per year for 5 years
and a participating utility that is a combination utility shall
pay $1,000,000 per year for 10 years to the energy low-income
and support program, which is intended to fund customer
assistance programs with the primary purpose being avoidance of
imminent disconnection. Such programs may include:
(1) a residential hardship program that may partner
with community-based organizations, including senior
citizen organizations, and provides grants to low-income
residential customers, including low-income senior

09700HB0690ham001 - 28 - LRB097 03518 CEL 59067 a
citizens, who demonstrate a hardship;
(2) a program that provides grants and other bill
payment concessions to disabled veterans who demonstrate a
hardship and members of the armed services or reserve
forces of the United States or members of the Illinois
National Guard who are on active duty pursuant to an
executive order of the President of the United States, an
act of the Congress of the United States, or an order of
the Governor and who demonstrate a hardship;
(3) a budget assistance program that provides tools and
education to low-income senior citizens to assist them with
obtaining information regarding energy usage and effective
means of managing energy costs;
(4) a non-residential special hardship program that
provides grants to non-residential customers such as small
businesses and non-profit organizations that demonstrate a
hardship, including those providing services to senior
citizen and low-income customers; and
(5) a performance-based assistance program that
provides grants to encourage residential customers to make
on-time payments by matching a portion of the customer's
payments or providing credits towards arrearages.
The payments made by a participating utility pursuant to
this subsection (b-10) shall not be a recoverable expense. A
participating utility may elect to fund either new or existing
customer assistance programs, including, but not limited to,

09700HB0690ham001 - 29 - LRB097 03518 CEL 59067 a
those that are administered by the utility.
Programs that use funds that are provided by a
participating utility to reduce utility bills may be
implemented through tariffs that are filed with and reviewed by
the Commission. If a utility elects to file tariffs with the
Commission to implement all or a portion of the programs, those
tariffs shall, regardless of the date actually filed, be deemed
accepted and approved, and shall become effective on the
effective date of this amendatory Act of the 97th General
Assembly. The participating utilities whose customers benefit
from the funds that are disbursed as contemplated in this
Section shall file annual reports documenting the disbursement
of those funds with the Commission. The Commission has the
authority to audit disbursement of the funds to ensure they
were disbursed consistently with this Section.
If the Commission finds that a participating utility is no
longer eligible to update the performance-based formula rate
tariff pursuant to subsection (d) of this Section, or the
performance-based formula rate is otherwise terminated, then
the participating utility's voluntary commitments and
obligations under this subsection (b-10) shall immediately
terminate.
(c) A participating utility may elect to recover its
delivery services costs through a performance-based formula
rate approved by the Commission, which shall specify the cost
components that form the basis of the rate charged to customers

09700HB0690ham001 - 30 - LRB097 03518 CEL 59067 a
with sufficient specificity to operate in a standardized manner
and be updated annually with transparent information that
reflects the utility's actual costs to be recovered during the
applicable rate year, which is the period beginning with the
first billing day of January and extending through the last
billing day of the following December. In the event the utility
recovers a portion of its costs through automatic adjustment
clause tariffs on the effective date of this amendatory Act of
the 97th General Assembly, the utility may elect to continue to
recover these costs through such tariffs, but then these costs
shall not be recovered through the performance-based formula
rate. In the event the participating utility, prior to the
effective date of this amendatory Act of the 97th General
Assembly, filed electric delivery services tariffs with the
Commission pursuant to Section 9-201 of this Act that are
related to the recovery of its electric delivery services costs
that are still pending on the effective date of this amendatory
Act of the 97th General Assembly, the participating utility
shall, at the time it files its performance-based formula rate
tariff with the Commission, also file a notice of withdrawal
with the Commission to withdraw the electric delivery services
tariffs previously filed pursuant to Section 9-201 of this Act.
Upon receipt of such notice, the Commission shall dismiss with
prejudice any docket that had been initiated to investigate the
electric delivery services tariffs filed pursuant to Section
9-201 of this Act, and such tariffs and the record related

09700HB0690ham001 - 31 - LRB097 03518 CEL 59067 a
thereto shall not be the subject of any further hearing,
investigation, or proceeding of any kind related to rates for
electric delivery services.
The performance-based formula rate shall be implemented
through a tariff filed with the Commission consistent with the
provisions of this subsection (c) that shall be applicable to
all delivery services customers. The Commission shall initiate
and conduct an investigation of the tariff in a manner
consistent with the provisions of this subsection (c) and the
provisions of Article IX of this Act to the extent they do not
conflict with this subsection (c). Except in the case where the
Commission finds, after notice and hearing, that a
participating utility is not satisfying its investment amount
commitments under subsection (b) of this Section, the
performance-based formula rate shall remain in effect at the
discretion of the utility. The performance-based formula rate
approved by the Commission shall do the following:
(1) Provide for the recovery of the utility's actual
costs of delivery services that are prudently incurred and
reasonable in amount consistent with Commission practice
and law. The sole fact that a cost differs from that
incurred in a prior calendar year or that an investment is
different from that made in a prior calendar year shall not
imply the imprudence or unreasonableness of that cost or
investment.
(2) Reflect the utility's actual capital structure for

09700HB0690ham001 - 32 - LRB097 03518 CEL 59067 a
the applicable calendar year, excluding goodwill, subject
to a determination of prudence and reasonableness
consistent with Commission practice and law.
(3) Include a cost of equity, which shall be calculated
as the sum of the following:
(A) the average for the applicable calendar year of
the monthly average yields of 30-year U.S. Treasury
bonds published by the Board of Governors of the
Federal Reserve System in its weekly H.15 Statistical
Release or successor publication; and
(B) 580 600 basis points.
At such time as the Board of Governors of the Federal
Reserve System ceases to include the monthly average yields
of 30-year U.S. Treasury bonds in its weekly H.15
Statistical Release or successor publication, the monthly
average yields of the U.S. Treasury bonds then having the
longest duration published by the Board of Governors in its
weekly H.15 Statistical Release or successor publication
shall instead be used for purposes of this paragraph (3).
(4) Permit and set forth protocols, subject to a
determination of prudence and reasonableness consistent
with Commission practice and law, for the following:
(A) recovery of incentive compensation expense
that is based on the achievement of operational
metrics, including metrics related to budget controls,
outage duration and frequency, safety, customer

09700HB0690ham001 - 33 - LRB097 03518 CEL 59067 a
service, efficiency and productivity, and
environmental compliance. Incentive compensation
expense that is based on net income or an affiliate's
earnings per share shall not be recoverable under the
performance-based formula rate;
(B) recovery of pension and other post-employment
benefits expense, provided that such costs are
supported by an actuarial study;
(C) recovery of severance costs, provided that if
the amount is over $3,700,000 for a participating
utility that is a combination utility or $10,000,000
for a participating utility that serves more than 3
million retail customers, then the full amount shall be
amortized consistent with subparagraph (F) of this
paragraph (4);
(D) investment return on pension assets net of
deferred tax benefits equal to the utility's long-term
debt cost of capital as of the end of the applicable
calendar year;
(E) recovery of the expenses related to the
Commission proceeding under this subsection (c) to
approve this performance-based formula rate and
initial rates or to subsequent proceedings related to
the formula, provided that the recovery shall be
amortized over a 3-year period; recovery of expenses
related to the annual Commission proceedings under

09700HB0690ham001 - 34 - LRB097 03518 CEL 59067 a
subsection (d) of this Section to review the inputs to
the performance-based formula rate shall be expensed
and recovered through the performance-based formula
rate;
(F) amortization over a 5-year period of the full
amount of each charge or credit that exceeds $3,700,000
for a participating utility that is a combination
utility or $10,000,000 for a participating utility
that serves more than 3 million retail customers in the
applicable calendar year and that relates to a
workforce reduction program's severance costs, changes
in accounting rules, changes in law, compliance with
any Commission-initiated audit, or a single storm or
other similar expense, provided that any unamortized
balance shall be reflected in rate base. For purposes
of this subparagraph (F), changes in law includes any
enactment, repeal, or amendment in a law, ordinance,
rule, regulation, interpretation, permit, license,
consent, or order, including those relating to taxes,
accounting, or to environmental matters, or in the
interpretation or application thereof by any
governmental authority occurring after the effective
date of this amendatory Act of the 97th General
Assembly;
(G) recovery of existing regulatory assets over
the periods previously authorized by the Commission;

09700HB0690ham001 - 35 - LRB097 03518 CEL 59067 a
(H) historical weather normalized billing
determinants; and
(I) allocation methods for common costs.
(5) Provide that if the participating utility's earned
rate of return on common equity related to the provision of
delivery services for the prior rate year (calculated using
costs and capital structure approved by the Commission as
provided in subparagraph (2) of this subsection (c),
consistent with this Section, in accordance with
Commission rules and orders, including, but not limited to,
adjustments for goodwill, and after any Commission-ordered
disallowances and taxes) is more than 50 basis points
higher than the rate of return on common equity calculated
pursuant to paragraph (3) of this subsection (c) (after
adjusting for any penalties to the rate of return on common
equity applied pursuant to the performance metrics
provision of subsection (f) of this Section), then the
participating utility shall apply a credit through the
performance-based formula rate that reflects an amount
equal to the value of that portion of the earned rate of
return on common equity that is more than 50 basis points
higher than the rate of return on common equity calculated
pursuant to paragraph (3) of this subsection (c) (after
adjusting for any penalties to the rate of return on common
equity applied pursuant to the performance metrics
provision of subsection (f) of this Section) for the prior

09700HB0690ham001 - 36 - LRB097 03518 CEL 59067 a
rate year, adjusted for taxes. If the participating
utility's earned rate of return on common equity related to
the provision of delivery services for the prior rate year
(calculated using costs and capital structure approved by
the Commission as provided in subparagraph (2) of this
subsection (c), consistent with this Section, in
accordance with Commission rules and orders, including,
but not limited to, adjustments for goodwill, and after any
Commission-ordered disallowances and taxes) is more than
50 basis points less than the return on common equity
calculated pursuant to paragraph (3) of this subsection (c)
(after adjusting for any penalties to the rate of return on
common equity applied pursuant to the performance metrics
provision of subsection (f) of this Section), then the
participating utility shall apply a charge through the
performance-based formula rate that reflects an amount
equal to the value of that portion of the earned rate of
return on common equity that is more than 50 basis points
less than the rate of return on common equity calculated
pursuant to paragraph (3) of this subsection (c) (after
adjusting for any penalties to the rate of return on common
equity applied pursuant to the performance metrics
provision of subsection (f) of this Section) for the prior
rate year, adjusted for taxes.
(6) Provide for an annual reconciliation, with
interest as described in subsection (d) of this Section, of

09700HB0690ham001 - 37 - LRB097 03518 CEL 59067 a
the revenue requirement reflected in rates for each
calendar year, beginning with the calendar year in which
the utility files its performance-based formula rate
tariff pursuant to subsection (c) of this Section, with
what the revenue requirement would have been had the actual
cost information for the applicable calendar year been
available at the filing date.
The utility shall file, together with its tariff, final
data based on its most recently filed FERC Form 1, plus
projected plant additions and correspondingly updated
depreciation reserve and expense for the calendar year in which
the tariff and data are filed, that shall populate the
performance-based formula rate and set the initial delivery
services rates under the formula. For purposes of this Section,
"FERC Form 1" means the Annual Report of Major Electric
Utilities, Licensees and Others that electric utilities are
required to file with the Federal Energy Regulatory Commission
under the Federal Power Act, Sections 3, 4(a), 304 and 209,
modified as necessary to be consistent with 83 Ill. Admin. Code
Part 415 as of May 1, 2011. Nothing in this Section is intended
to allow costs that are not otherwise recoverable to be
recoverable by virtue of inclusion in FERC Form 1.
After the utility files its proposed performance-based
formula rate structure and protocols and initial rates, the
Commission shall initiate a docket to review the filing. The
Commission shall enter an order approving, or approving as

09700HB0690ham001 - 38 - LRB097 03518 CEL 59067 a
modified, the performance-based formula rate, including the
initial rates, as just and reasonable within 270 days after the
date on which the tariff was filed, or, if the tariff is filed
within 14 days after the effective date of this amendatory Act
of the 97th General Assembly, then by May 31, 2012. Such review
shall be based on the same evidentiary standards, including,
but not limited to, those concerning the prudence and
reasonableness of the costs incurred by the utility, the
Commission applies in a hearing to review a filing for a
general increase in rates under Article IX of this Act. The
initial rates shall take effect within 30 days after the
Commission's order approving the performance-based formula
rate tariff.
Until such time as the Commission approves a different rate
design and cost allocation pursuant to subsection (e) of this
Section, rate design and cost allocation across customer
classes shall be consistent with the Commission's most recent
order regarding the participating utility's request for a
general increase in its delivery services rates.
Subsequent changes to the performance-based formula rate
structure or protocols shall be made as set forth in Section
9-201 of this Act, but nothing in this subsection (c) is
intended to limit the Commission's authority under Article IX
and other provisions of this Act to initiate an investigation
of a participating utility's performance-based formula rate
tariff, provided that any such changes shall be consistent with

09700HB0690ham001 - 39 - LRB097 03518 CEL 59067 a
paragraphs (1) through (6) of this subsection (c). Any change
ordered by the Commission shall be made at the same time new
rates take effect following the Commission's next order
pursuant to subsection (d) of this Section, provided that the
new rates take effect no less than 30 days after the date on
which the Commission issues an order adopting the change.
A participating utility that files a tariff pursuant to
this subsection (c) must submit a one-time $200,000 filing fee
at the time the Chief Clerk of the Commission accepts the
filing, which shall be a recoverable expense.
In the event the performance-based formula rate is
terminated, the then current rates shall remain in effect until
such time as new rates are set pursuant to Article IX of this
Act, subject to retroactive rate adjustment, with interest, to
reconcile rates charged with actual costs. At such time that
the performance-based formula rate is terminated, the
participating utility's voluntary commitments and obligations
under subsection (b) of this Section shall immediately
terminate, except for the utility's obligation to pay an amount
already owed to the fund for training grants pursuant to a
Commission order issued under subsection (b) of this Section.
(d) Subsequent to the Commission's issuance of an order
approving the utility's performance-based formula rate
structure and protocols, and initial rates under subsection (c)
of this Section, the utility shall file, on or before May 1 of
each year, with the Chief Clerk of the Commission its updated

09700HB0690ham001 - 40 - LRB097 03518 CEL 59067 a
cost inputs to the performance-based formula rate for the
applicable rate year and the corresponding new charges. Each
such filing shall conform to the following requirements and
include the following information:
(1) The inputs to the performance-based formula rate
for the applicable rate year shall be based on final
historical data reflected in the utility's most recently
filed annual FERC Form 1 plus projected plant additions and
correspondingly updated depreciation reserve and expense
for the calendar year in which the inputs are filed. The
filing shall also include a reconciliation of the revenue
requirement that was in effect for the prior rate year (as
set by the cost inputs for the prior rate year) with the
actual revenue requirement for the prior rate year (as
reflected in the applicable FERC Form 1 that reports the
actual costs for the prior rate year). Any over-collection
or under-collection indicated by such reconciliation shall
be reflected as a credit against, or recovered as an
additional charge to, respectively, with interest, the
charges for the applicable rate year. Provided, however,
that the first such reconciliation shall be for the
calendar year in which the utility files its
performance-based formula rate tariff pursuant to
subsection (c) of this Section and shall reconcile (i) the
revenue requirement or requirements established by the
rate order or orders in effect from time to time during

09700HB0690ham001 - 41 - LRB097 03518 CEL 59067 a
such calendar year (weighted, as applicable) with (ii) the
revenue requirement for that calendar year calculated
pursuant to the performance-based formula rate using (A)
actual costs for that year as reflected in the applicable
FERC Form 1, and (B) for the first such reconciliation
only, the cost of equity, which shall be calculated as the
sum of 590 basis points plus the average for the applicable
calendar year of the monthly average yields of 30-year U.S.
Treasury bonds published by the Board of Governors of the
Federal Reserve System in its weekly H.15 Statistical
Release or successor publication approved by the
Commission in such order or orders in effect during that
year (weighted, as applicable). The first such
reconciliation is not intended to provide for the recovery
of costs previously excluded from rates based on a prior
Commission order finding of imprudence or
unreasonableness. Each reconciliation shall be certified
by the participating utility in the same manner that FERC
Form 1 is certified. The filing shall also include the
charge or credit, if any, resulting from the calculation
required by paragraph (6) of subsection (c) of this
Section.
Notwithstanding anything that may be to the contrary,
the intent of the reconciliation is to ultimately reconcile
the revenue requirement reflected in rates for each
calendar year, beginning with the calendar year in which

09700HB0690ham001 - 42 - LRB097 03518 CEL 59067 a
the utility files its performance-based formula rate
tariff pursuant to subsection (c) of this Section, with
what the revenue requirement would have been had the actual
cost information for the applicable calendar year been
available at the filing date.
(2) The new charges shall take effect beginning on the
first billing day of the following January billing period
and remain in effect through the last billing day of the
next December billing period regardless of whether the
Commission enters upon a hearing pursuant to this
subsection (d).
(3) The filing shall include relevant and necessary
data and documentation for the applicable rate year that is
consistent with the Commission's rules applicable to a
filing for a general increase in rates or any rules adopted
by the Commission to implement this Section. Normalization
adjustments shall not be required. Notwithstanding any
other provision of this Section or Act or any rule or other
requirement adopted by the Commission, a participating
utility that is a combination utility with more than one
rate zone shall not be required to file a separate set of
such data and documentation for each rate zone and may
combine such data and documentation into a single set of
schedules.
Within 45 days after the utility files its annual update of
cost inputs to the performance-based formula rate, the

09700HB0690ham001 - 43 - LRB097 03518 CEL 59067 a
Commission shall have the authority, either upon complaint or
its own initiative, but with reasonable notice, to enter upon a
hearing concerning the prudence and reasonableness of the costs
incurred by the utility to be recovered during the applicable
rate year that are reflected in the inputs to the
performance-based formula rate derived from the utility's FERC
Form 1. During the course of the hearing, each objection shall
be stated with particularity and evidence provided in support
thereof, after which the utility shall have the opportunity to
rebut the evidence. Discovery shall be allowed consistent with
the Commission's Rules of Practice, which Rules shall be
enforced by the Commission or the assigned hearing examiner.
The Commission shall apply the same evidentiary standards,
including, but not limited to, those concerning the prudence
and reasonableness of the costs incurred by the utility, in the
hearing as it would apply in a hearing to review a filing for a
general increase in rates under Article IX of this Act. The
Commission shall not, however, have the authority in a
proceeding under this subsection (d) to consider or order any
changes to the structure or protocols of the performance-based
formula rate approved pursuant to subsection (c) of this
Section. In a proceeding under this subsection (d), the
Commission shall enter its order no later than the earlier of
240 days after the utility's filing of its annual update of
cost inputs to the performance-based formula rate or December
31. The Commission's determinations of the prudence and

09700HB0690ham001 - 44 - LRB097 03518 CEL 59067 a
reasonableness of the costs incurred for the applicable
calendar year shall be final upon entry of the Commission's
order and shall not be subject to reopening, reexamination, or
collateral attack in any other Commission proceeding, case,
docket, order, rule or regulation, provided, however, that
nothing in this subsection (d) shall prohibit a party from
petitioning the Commission to rehear or appeal to the courts
the order pursuant to the provisions of this Act.
In the event the Commission does not, either upon complaint
or its own initiative, enter upon a hearing within 45 days
after the utility files the annual update of cost inputs to its
performance-based formula rate, then the costs incurred for the
applicable calendar year shall be deemed prudent and
reasonable, and the filed charges shall not be subject to
reopening, reexamination, or collateral attack in any other
proceeding, case, docket, order, rule, or regulation.
A participating utility's first filing of the updated cost
inputs, and any Commission investigation of such inputs
pursuant to this subsection (d) shall proceed notwithstanding
the fact that the Commission's investigation under subsection
(c) of this Section is still pending and notwithstanding any
other law, order, rule, or Commission practice to the contrary.
(e) Nothing in subsections (c) or (d) of this Section shall
prohibit the Commission from investigating, or a participating
utility from filing, revenue-neutral tariff changes related to
rate design of a performance-based formula rate that has been

09700HB0690ham001 - 45 - LRB097 03518 CEL 59067 a
placed into effect for the utility. Following approval of a
participating utility's performance-based formula rate tariff
pursuant to subsection (c) of this Section, the utility shall
make a filing with the Commission within one year after the
effective date of the performance-based formula rate tariff
that proposes changes to the tariff to incorporate the findings
of any final rate design orders of the Commission applicable to
the participating utility and entered subsequent to the
Commission's approval of the tariff. The Commission shall,
after notice and hearing, enter its order approving, or
approving with modification, the proposed changes to the
performance-based formula rate tariff within 240 days after the
utility's filing. Following such approval, the utility shall
make a filing with the Commission during each subsequent 3-year
period that either proposes revenue-neutral tariff changes or
re-files the existing tariffs without change, which shall
present the Commission with an opportunity to suspend the
tariffs and consider revenue-neutral tariff changes related to
rate design.
(f) Within 30 days after the filing of a tariff pursuant to
subsection (c) of this Section, each participating utility
shall develop and file with the Commission multi-year metrics
designed to achieve, ratably (i.e., in equal segments) over a
10-year period, improvement over baseline performance values
as follows:
(1) Twenty percent improvement in the System Average

09700HB0690ham001 - 46 - LRB097 03518 CEL 59067 a
Interruption Frequency Index, using a baseline of the
average of the data from 2001 through 2010.
(2) Fifteen percent improvement in the system Customer
Average Interruption Duration Index, using a baseline of
the average of the data from 2001 through 2010.
(3) For a participating utility other than a
combination utility, 20% improvement in the System Average
Interruption Frequency Index for its Southern Region,
using a baseline of the average of the data from 2001
through 2010. For purposes of this paragraph (3) paragraph
(C), Southern Region shall have the meaning set forth in
the participating utility's most recent report filed
pursuant to Section 16-125 of this Act.
(3.5) For a participating utility other than a
combination utility, 20% improvement in the System Average
Interruption Frequency Index for its Northeastern Region,
using a baseline of the average of the data from 2001
through 2010. For purposes of this paragraph (3.5),
Northeastern Region shall have the meaning set forth in the
participating utility's most recent report filed pursuant
to Section 16-125 of this Act.
(4) Seventy-five percent improvement in the total
number of customers who exceed the service reliability
targets as set forth in subparagraphs (A) through (C) of
paragraph (4) of subsection (b) of 83 Ill. Admin. Code Part
411.140 as of May 1, 2011, using 2010 as the baseline year.

09700HB0690ham001 - 47 - LRB097 03518 CEL 59067 a
(5) Reduction in issuance of estimated electric bills:
90% improvement for a participating utility other than a
combination utility, and 56% improvement for a
participating utility that is a combination utility, using
a baseline of the average number of estimated bills for the
years 2008 through 2010.
(6) Consumption on inactive meters: 90% improvement
for a participating utility other than a combination
utility, and 56% improvement for a participating utility
that is a combination utility, using a baseline of the
average unbilled kilowatthours for the years 2009 and 2010.
(7) Unaccounted for energy: 50% improvement for a
participating utility other than a combination utility
using a baseline of the non-technical line loss unaccounted
for energy kilowatthours for the year 2009.
(8) Uncollectible expense: reduce uncollectible
expense by at least $30,000,000 for a participating utility
other than a combination utility and by at least $3,500,000
for a participating utility that is a combination utility,
using a baseline of the average uncollectible expense for
the years 2008 through 2010.
(9) Opportunities for minority-owned and female-owned
business enterprises: design a performance metric
regarding the creation of opportunities for minority-owned
and female-owned business enterprises consistent with
State and federal law using a base performance value of the

09700HB0690ham001 - 48 - LRB097 03518 CEL 59067 a
percentage of the participating utility's capital
expenditures that were paid to minority-owned and
female-owned business enterprises in 2010.
The definitions set forth in 83 Ill. Admin. Code Part
411.20 as of May 1, 2011 shall be used for purposes of
calculating performance under paragraphs (1) through (3.5) (3)
of this subsection (f), provided, however, that the
participating utility may exclude up to 9 extreme weather event
days from such calculation for each year, and provided further
that the participating utility shall exclude 9 extreme weather
event days when calculating each year of the baseline period to
the extent that there are 9 such days in a given year of the
baseline period. For purposes of this Section, an extreme
weather event day is a 24-hour calendar day (beginning at 12:00
a.m. and ending at 11:59 p.m.) during which any weather event
(e.g., storm, tornado) caused interruptions for 10,000 or more
of the participating utility's customers for 3 hours or more.
If there are more than 9 extreme weather event days in a year,
then the utility may choose no more than 9 extreme weather
event days to exclude, provided that the same extreme weather
event days are excluded from each of the calculations performed
under paragraphs (1) through (3.5) (3) of this subsection (f).
The metrics shall include incremental performance goals
for each year of the 10-year period, which shall be designed to
demonstrate that the utility is on track to achieve the
performance goal in each category at the end of the 10-year

09700HB0690ham001 - 49 - LRB097 03518 CEL 59067 a
period. The utility shall elect when the 10-year period shall
commence for the metrics set forth in subparagraphs (1) through
(4) and (9) of this subsection (f), provided that it begins no
later than 14 months following the date on which the utility
begins investing pursuant to subsection (b) of this Section,
and when the 10-year period shall commence for the metrics set
forth in subparagraphs (5) through (8) of this subsection (f),
provided that it begins no later than 14 months following the
date on which the Commission enters its order approving the
utility's Advanced Metering Infrastructure Deployment Plan
pursuant to subsection (c) of Section 16-108.6 of this Act.
The metrics and performance goals set forth in
subparagraphs (5) through (8) of this subsection (f) are based
on the assumptions that the participating utility may fully
implement the technology described in subsection (b) of this
Section, including utilizing the full functionality of such
technology and that there is no requirement for personal
on-site notification. If the utility is unable to meet the
metrics and performance goals set forth in subparagraphs (5)
through (8) of this subsection (f) for such reasons, and the
Commission so finds after notice and hearing, then the utility
shall be excused from compliance, but only to the limited
extent achievement of the affected metrics and performance
goals was hindered by the less than full implementation.
(f-5) The financial penalties applicable to the metrics
described in subparagraphs (1) through (8) of subsection (f) of

09700HB0690ham001 - 50 - LRB097 03518 CEL 59067 a
this Section, as applicable, shall be applied through an
adjustment to the participating utility's return on equity of
no more than a total of 30 basis points in each of the first 3
years, of no more than a total of 34 basis points in each of the
3 years thereafter, and of no more than a total of 38 basis
points in each of the 4 years thereafter, as follows:
(1) With respect to each of the incremental annual
performance goals established pursuant to paragraph (1) of
subsection (f) of this Section,
(A) for each year that a participating utility
other than a combination utility does not achieve the
annual goal, the participating utility's return on
equity shall be reduced as follows: during years 1
through 3, by 5 basis points; during years 4 through 6,
by 6 basis points; and during years 7 through 10, by 7
basis points; for such unachieved goal for the
following 12-month period, and
(B) for each year that a participating utility that
is a combination utility does not achieve the annual
goal, the participating utility's return on equity
shall be reduced as follows: during years 1 through 3,
by 10 basis points; during years 4 through 6, by 12
basis points; and during years 7 through 10, by 14
basis points for each such unachieved goal for the
following 12-month period.
(2) With respect to each of the incremental annual

09700HB0690ham001 - 51 - LRB097 03518 CEL 59067 a
performance goals established pursuant to paragraph
subparagraphs (2), (3), and (4) of subsection (f) of this
Section, as applicable, for each year that the
participating utility does not achieve each such goal, the
participating utility's return on equity shall be reduced
as follows: during years 1 through 3, by 5 basis points;
during years 4 through 6, by 6 basis points; and during
years 7 through 10, by 7 basis points for each such
unachieved goal for the following 12-month period.
(3) With respect to each of the incremental annual
performance goals established pursuant to paragraphs (3)
and (3.5) of subsection (f) of this Section, for each year
that a participating utility other than a combination
utility does not achieve both such goals, the participating
utility's return on equity shall be reduced as follows:
during years 1 through 3, by 5 basis points; during years 4
through 6, by 6 basis points; and during years 7 through
10, by 7 basis points.
(4) With respect to each of the incremental annual
performance goals established pursuant to paragraph (4) of
subsection (f) of this Section, for each year that the
participating utility does not achieve each such goal, the
participating utility's return on equity shall be reduced
as follows: during years 1 through 3, by 5 basis points;
during years 4 through 6, by 6 basis points; and during
years 7 through 10, by 7 basis points.

09700HB0690ham001 - 52 - LRB097 03518 CEL 59067 a
(5) With respect to each of the incremental annual
performance goals established pursuant to subparagraph (5)
of subsection (f) of this Section, for each year that the
participating utility does not achieve at least 95% of each
such goal, the participating utility's return on equity
shall be reduced by 5 basis points for each such unachieved
goal for the following 12-month period.
(6) (3) With respect to each of the incremental annual
performance goals established pursuant to paragraphs (6),
(7), and (8) of subsection (f) of this Section, as
applicable, which together measure non-operational
customer savings and benefits relating to the
implementation of the Advanced Metering Infrastructure
Deployment Plan, as defined in Section 16-108.6 of this
Act, the performance under each such goal shall be
calculated in terms of the percentage of the goal achieved.
The percentage of goal achieved for each of the goals shall
be aggregated, and an average percentage value calculated,
for each year of the 10-year period. If the utility does
not achieve an average percentage value in a given year of
at least 95%, the participating utility's return on equity
shall be reduced by 5 basis points for the following
12-month period.
The financial penalties shall be applied as described in
this subsection (f-5) for the 12-month period in which the
deficiency occurred through a separate tariff mechanism, which

09700HB0690ham001 - 53 - LRB097 03518 CEL 59067 a
shall be filed by the utility together with its metrics. In the
event the formula rate tariff established pursuant to
subsection (c) of this Section terminates, the utility's
obligations under subsection (f) of this Section and this
subsection (f-5) shall also terminate, provided, however, that
the tariff mechanism established pursuant to subsection (f) of
this Section and this subsection (f-5) shall remain in effect
until any penalties due and owing at the time of such
termination are applied.
The Commission shall, after notice and hearing, enter an
order within 120 days after the metrics are filed approving, or
approving with modification, a participating utility's tariff
or mechanism to satisfy the metrics set forth in subsection (f)
of this Section. On June 1 of each subsequent year, each
participating utility shall file a report with the Commission
that includes, among other things, a description of how the
participating utility performed under each metric and an
identification of any extraordinary events that adversely
impacted the utility's performance. Whenever a participating
utility does not satisfy the metrics required pursuant to
subsection (f) of this Section, the Commission shall, after
notice and hearing, enter an order approving financial
penalties in accordance with this subsection (f-5). The
Commission-approved financial penalties shall be applied
beginning with the next rate year. Nothing in this Section
shall authorize the Commission to reduce or otherwise obviate

09700HB0690ham001 - 54 - LRB097 03518 CEL 59067 a
the imposition of financial penalties for failing to achieve
one or more of the metrics established pursuant to subparagraph
(1) through (4) of subsection (f) of this Section.
(g) On or before July 31, 2014, each participating utility
shall file a report with the Commission that sets forth the
average annual increase in the average amount paid per
kilowatthour for residential eligible retail customers,
exclusive of the effects of energy efficiency programs,
comparing the 12-month period ending May 31, 2012; the 12-month
period ending May 31, 2013; and the 12-month period ending May
31, 2014. For a participating utility that is a combination
utility with more than one rate zone, the weighted average
aggregate increase shall be provided. The report shall be filed
together with a statement from an independent auditor attesting
to the accuracy of the report. The cost of the independent
auditor shall be borne by the participating utility and shall
not be a recoverable expense.
In the event that the average annual increase exceeds 2.5%
as calculated pursuant to this subsection (g), then Sections
16-108.5, 16-108.6, 16-108.7, and 16-108.8 of this Act, other
than this subsection, shall be inoperative as they relate to
the utility and its service area as of the date of the report
due to be submitted pursuant to this subsection and the utility
shall no longer be eligible to annually update the
performance-based formula rate tariff pursuant to subsection
(d) of this Section. In such event, the then current rates

09700HB0690ham001 - 55 - LRB097 03518 CEL 59067 a
shall remain in effect until such time as new rates are set
pursuant to Article IX of this Act, subject to retroactive
adjustment, with interest, to reconcile rates charged with
actual costs, and the participating utility's voluntary
commitments and obligations under subsection (b) of this
Section shall immediately terminate, except for the utility's
obligation to pay an amount already owed to the fund for
training grants pursuant to a Commission order issued under
subsection (b) of this Section.
In the event that the average annual increase is 2.5% or
less as calculated pursuant to this subsection (g), then the
performance-based formula rate shall remain in effect as set
forth in this Section.
For purposes of this Section, the amount per kilowatthour
means the total amount paid for electric service expressed on a
per kilowatthour basis, and the total amount paid for electric
service includes without limitation amounts paid for supply,
transmission, distribution, surcharges, and add-on taxes
exclusive of any increases in taxes or new taxes imposed after
the effective date of this amendatory Act of the 97th General
Assembly. For purposes of this Section, "eligible retail
customers" shall have the meaning set forth in Section 16-111.5
of this Act.
The fact that this Section becomes inoperative as set forth
in this subsection shall not be construed to mean that the
Commission may reexamine or otherwise reopen prudence or

09700HB0690ham001 - 56 - LRB097 03518 CEL 59067 a
reasonableness determinations already made.
(h) Sections 16-108.5, 16-108.6, 16-108.7, and 16-108.8 of
this Act, other than this subsection, are inoperative after
December 31, 2017 for every participating utility, after which
time a participating utility shall no longer be eligible to
annually update the performance-based formula rate tariff
pursuant to subsection (d) of this Section. At such time, the
then current rates shall remain in effect until such time as
new rates are set pursuant to Article IX of this Act, subject
to retroactive adjustment, with interest, to reconcile rates
charged with actual costs.
By December 31, 2017, the Commission shall prepare and file
with the General Assembly a report on the infrastructure
program and the performance-based formula rate. The report
shall include the change in the average amount per kilowatthour
paid by residential customers between June 1, 2011 and May 31,
2017. If the change in the total average rate paid exceeds 2.5%
compounded annually, the Commission shall include in the report
an analysis that shows the portion of the change due to the
delivery services component and the portion of the change due
to the supply component of the rate. The report shall include
separate sections for each participating utility.
In the event Sections 16-108.5, 16-108.6, 16-108.7, and
16-108.8 of this Act do not become inoperative after December
31, 2017, then these Sections are inoperative after December
31, 2022 for every participating utility, after which time a

09700HB0690ham001 - 57 - LRB097 03518 CEL 59067 a
participating utility shall no longer be eligible to annually
update the performance-based formula rate tariff pursuant to
subsection (d) of this Section. At such time, the then current
rates shall remain in effect until such time as new rates are
set pursuant to Article IX of this Act, subject to retroactive
adjustment, with interest, to reconcile rates charged with
actual costs.
The fact that this Section becomes inoperative as set forth
in this subsection shall not be construed to mean that the
Commission may reexamine or otherwise reopen prudence or
reasonableness determinations already made.
(i) While a participating utility may use, develop, and
maintain broadband systems and the delivery of broadband
services, voice-over-internet-protocol services,
telecommunications services, and cable and video programming
services for use in providing delivery services and Smart Grid
functionality or application to its retail customers,
including, but not limited to, the installation,
implementation and maintenance of Smart Grid electric system
upgrades as defined in Section 16-108.6 of this Act, a
participating utility is prohibited from offering to its retail
customers broadband services or the delivery of broadband
services, voice-over-internet-protocol services,
telecommunications services, or cable or video programming
services, unless they are part of a service directly related to
delivery services or Smart Grid functionality or applications

09700HB0690ham001 - 58 - LRB097 03518 CEL 59067 a
as defined in Section 16-108.6 of this Act, and from recovering
the costs of such offerings from retail customers.
(j) Nothing in this Section is intended to legislatively
overturn the opinion issued in Commonwealth Edison Co. v. Ill.
Commerce Comm'n, Nos. 2-08-0959, 2-08-1037, 2-08-1137,
1-08-3008, 1-08-3030, 1-08-3054, 1-08-3313 cons. (Ill. App.
Ct. 2d Dist. Sept. 30, 2010). This amendatory Act of the 97th
General Assembly shall not be construed as creating a contract
between the General Assembly and the participating utility, and
shall not establish a property right in the participating
utility.
(Source: 09700SB1652enr.)
(220 ILCS 5/16-108.6)
Sec. 16-108.6. Provisions relating to Smart Grid Advanced
Metering Infrastructure Deployment Plan.
(a) For purposes of this Section and Sections 16-108.7 and
16-108.8 of this Act:
"Advanced Metering Infrastructure" or "AMI" means the
communications hardware and software and associated system
software that enables Smart Grid functions by creating a
network between advanced meters and utility business systems
and allowing collection and distribution of information to
customers and other parties in addition to providing
information to the utility itself.
"Cost-beneficial" means a determination that the benefits

09700HB0690ham001 - 59 - LRB097 03518 CEL 59067 a
of a participating utility's Smart Grid AMI Deployment Plan
exceed the costs of the Smart Grid AMI Deployment Plan as
initially filed with the Commission or as subsequently modified
by the Commission. This standard is met if the present value of
the total benefits of the Smart Grid AMI Deployment Plan
exceeds the present value of the total costs of the Smart Grid
AMI Deployment Plan. The total cost shall include all utility
costs reasonably associated with the Smart Grid AMI Deployment
Plan. The total benefits shall include the sum of avoided
electricity costs, including avoided utility operational
costs, avoided consumer power, capacity, and energy costs, and
avoided societal costs associated with the production and
consumption of electricity, as well as other societal benefits,
including the greater integration of renewable and distributed
power resources, reductions in the emissions of harmful
pollutants and associated avoided health-related costs, other
benefits associated with energy efficiency measures,
demand-response activities, and the enabling of greater
penetration of alternative fuel vehicles.
"Participating utility" has the meaning set forth in
Section 16-108.5 of this Act.
"Smart Grid" means investments and policies that together
promote one or more of the following goals:
(1) Increased use of digital information and controls
technology to improve reliability, security, and
efficiency of the electric grid.

09700HB0690ham001 - 60 - LRB097 03518 CEL 59067 a
(2) Dynamic optimization of grid operations and
resources, with full cyber security.
(3) Deployment and integration of distributed
resources and generation, including renewable resources.
(4) Development and incorporation of demand-response,
demand-side resources, and energy efficiency resources.
(5) Deployment of "smart" technologies (real-time,
automated, interactive technologies that optimize the
physical operation of appliances and consumer devices) for
metering, communications concerning grid operations and
status, and distribution automation.
(6) Integration of "smart" appliances and consumer
devices.
(7) Deployment and integration of advanced electricity
storage and peak-shaving technologies, including plug-in
electric and hybrid electric vehicles, thermal-storage air
conditioning and renewable energy generation.
(8) Provision to consumers of timely information and
control options.
(9) Development of open access standards for
communication and interoperability of appliances and
equipment connected to the electric grid, including the
infrastructure serving the grid.
(10) Identification and lowering of unreasonable or
unnecessary barriers to adoption of Smart Grid
technologies, practices, services, and business models

09700HB0690ham001 - 61 - LRB097 03518 CEL 59067 a
that support energy efficiency, demand-response, and
distributed generation.
"Smart Grid Advisory Council" means the group of
stakeholders formed pursuant to subsection (b) of this Section
for the purposes of advising and working with participating
utilities on the development and implementation of a Smart Grid
Advanced Metering Infrastructure Deployment Plan.
"Smart Grid electric system upgrades" means any of the
following:
(1) metering devices, sensors, control devices, and
other devices integrated with and attached to an electric
utility system that are capable of engaging in Smart Grid
functions;
(2) other monitoring and communications devices that
enable Smart Grid functions, including, but not limited to,
distribution automation;
(3) software that enables devices or computers to
engage in Smart Grid functions;
(4) associated cyber secure data communication
network, including enhancements to cyber-security
technologies and measures;
(5) substation micro-processor relay upgrades;
(6) devices that allow electric or hybrid-electric
vehicles to engage in Smart Grid functions; or
(7) devices that enable individual consumers to
incorporate distributed and micro-generation.

09700HB0690ham001 - 62 - LRB097 03518 CEL 59067 a
"Smart Grid electric system upgrades" does not include
expenditures for: (1) electricity generation, transmission, or
distribution infrastructure or equipment that does not
directly relate to or support installing, implementing or
enabling Smart Grid functions; (2) physical interconnection of
generators or other devices to the grid except those that are
directly related to enabling Smart Grid functions; or (3)
ongoing or routine operation, billing, customer relations,
security, and maintenance.
"Smart Grid functions" means:
(1) the ability to develop, store, send, and receive
digital information concerning or enabling grid
operations, electricity use, costs, prices, time of use,
nature of use, storage, or other information relevant to
device, grid, or utility operations, to or from or by means
of the electric utility system through one or a combination
of devices and technologies;
(2) the ability to develop, store, send, and receive
digital information concerning electricity use, costs,
prices, time of use, nature of use, storage, or other
information relevant to device, grid, or utility
operations to or from a computer or other control device;
(3) the ability to measure or monitor electricity use
as a function of time of day, power quality characteristics
such as voltage level, current, cycles per second, or
source or type of generation and to store, synthesize, or

09700HB0690ham001 - 63 - LRB097 03518 CEL 59067 a
report that information by digital means;
(4) the ability to sense and localize disruptions or
changes in power flows on the grid and communicate such
information instantaneously and automatically for purposes
of enabling automatic protective responses to sustain
reliability and security of grid operations;
(5) the ability to detect, prevent, communicate with
regard to, respond to, or recover from system security
threats, including cyber-security threats and terrorism,
using digital information, media, and devices;
(6) the ability of any device or machine to respond to
signals, measurements, or communications automatically or
in a manner programmed by its owner or operator without
independent human intervention;
(7) the ability to use digital information to operate
functionalities on the electric utility grid that were
previously electro-mechanical or manual;
(8) the ability to use digital controls to manage and
modify electricity demand, enable congestion management,
assist in voltage control, provide operating reserves, and
provide frequency regulation; or
(9) the ability to integrate electric plug-in
vehicles, distributed generation, and storage in a safe and
cost-effective manner on the electric grid.
(b) Within 30 days after the effective date of this
amendatory Act of the 97th General Assembly, the Smart Grid

09700HB0690ham001 - 64 - LRB097 03518 CEL 59067 a
Advisory Council shall be established, which shall consist of 9
7 total voting members with each member possessing either
technical, business or consumer expertise in Smart Grid issues,
5 of whom shall be appointed by and each having been the single
appointment of one of the following: the Governor, one of whom
shall be appointed by the Speaker of the House, one of whom
shall be appointed by the Minority Leader of the House, one of
whom shall be appointed by the President of the Senate, and one
of whom shall be appointed by the Minority Leader of the
Senate. Of the Governor's 5 appointments: (i) at least one must
represent a non-profit membership organization whose mission
is to cultivate innovation and technology-based economic
development in Illinois by fostering public-private
partnerships to develop and execute research and development
projects, advocating for funding for research and development
initiatives, and collaborating with public and private
partners to attract and retain research and development
resources and talent in Illinois; (ii) at least one must
represent a non-profit public body corporate and politic
created by law that has a duty to represent and protect
residential utility consumers in Illinois; (iii) at least one
must represent a membership organization that represents the
interests of individuals and companies that own, operate,
manage, and service commercial buildings in a municipality with
a population of 1,000,000 or more inhabitants; (iv) at least
one must represent an alternative retail electric supplier that

09700HB0690ham001 - 65 - LRB097 03518 CEL 59067 a
has obtained a certificate of service authority pursuant to
Section 16-115 of this Act and that is not an affiliate of a
participating utility prior to one year after the effective
date of this amendatory Act of the 97th General Assembly , the
Illinois Science and Technology Coalition, and the Citizens
Utility Board.
The Governor shall designate one of the members of the
Council to serve as chairman, and that person shall serve as
the chairman at the pleasure of the Governor. The members shall
not be compensated for serving on the Smart Grid Advisory
Council. The Smart Grid Advisory Council shall have the
following duties:
(1) Serve as an advisor to participating utilities
subject to this Section and in the manner described in this
Section, and the recommendations provided by the Council,
although non-binding, shall be considered by the
utilities.
(2) Serve as trustees of the trust or foundation
established pursuant to Section 16-108.7 of this Act with
the duties enumerated thereunder.
(c) After consultation with the Smart Grid Advisory
Council, each participating utility shall file a Smart Grid
Advanced Metering Infrastructure Deployment Plan ("AMI Plan")
with the Commission within 180 days after the effective date of
this amendatory Act of the 97th General Assembly or by November
1, 2011, whichever is later, or in the case of a combination

09700HB0690ham001 - 66 - LRB097 03518 CEL 59067 a
utility as defined in Section 16-108.5, by April 1, 2012,
provided that a participating utility shall not file its plan
until the evaluation report on the Pilot Program described in
this subsection (c) is issued. The AMI Plan shall provide for
investment over a 10-year period that is sufficient to
implement the AMI Plan across its entire service territory in a
manner that is consistent with subsection (b) of Section
16-108.5 of this Act. The AMI Plan shall contain:
(1) the participating utility's Smart Grid AMI vision
statement that is consistent with the goal of developing a
cost-beneficial Smart Grid;
(2) a statement of Smart Grid AMI strategy that
includes a description of how the utility evaluates and
prioritizes technology choices to create customer value,
including a plan to enhance and enable customers' ability
to take advantage of Smart Grid functions beginning at the
time an account has billed successfully on the AMI network;
(3) a deployment schedule and plan that includes
deployment of AMI to all customers for a participating
utility other than a combination utility, and to 62% of all
customers for a participating utility that is a combination
utility;
(4) annual milestones and metrics for the purposes of
measuring the success of the AMI Plan in enabling Smart
Grid functions; and enhancing consumer benefits from Smart
Grid AMI; and

09700HB0690ham001 - 67 - LRB097 03518 CEL 59067 a
(5) a plan for the consumer education to be implemented
by the participating utility.
The AMI Plan shall be fully consistent with the standards
of the National Institute of Standard and Technology (NIST) for
Smart Grid interoperability that are in effect at the time the
participating utility files its AMI Plan, shall include open
standards and internet protocol to the maximum extent possible
consistent with cyber security, and shall maximize, to the
extent possible, a flexible smart meter platform that can
accept remote device upgrades and contain sufficient internal
memory capacity for additional storage capabilities, functions
and services without the need for physical access to the meter.
The AMI Plan shall secure the privacy of personal
information and establish the right of consumers to consent to
the disclosure of personal energy information to third parties
through electronic, web-based, and other means in accordance
with State and federal law and regulations regarding consumer
privacy and protection of consumer data.
After notice and hearing, the Commission shall, within 60
days of the filing of an AMI Plan, issue its order approving,
or approving with modification, the AMI Plan if the Commission
finds that the AMI Plan contains the information required in
paragraphs (1) through (5) of this subsection (c) and further
finds that the implementation of the AMI Plan will be
cost-beneficial consistent with the principles established
through the Illinois Smart Grid Collaborative, giving weight to

09700HB0690ham001 - 68 - LRB097 03518 CEL 59067 a
the results of any Commission-approved pilot designed to
examine the benefits and costs of AMI deployment. A
participating utility's decision to invest pursuant to an AMI
Plan approved by the Commission shall not be subject to
prudence reviews in subsequent Commission proceedings. Nothing
in this subsection (c) is intended to limit the Commission's
ability to review the reasonableness of the costs incurred
under the AMI Plan. A participating utility shall be allowed to
recover the reasonable costs it incurs in implementing a
Commission-approved AMI Plan, including the costs of retired
meters, and may recover such costs through its tariffs,
including the performance-based formula rate tariff approved
pursuant to subsection (c) of Section 16-108.5 of this Act.
(d) The AMI Plan shall secure the privacy of the customer's
personal information. "Personal information" for this purpose
consists of the customer's name, address, telephone number, and
other personally identifying information, as well as
information about the customer's electric usage. Electric
utilities, their contractors or agents, and any third party who
comes into possession of such personal information by virtue of
working on Smart Grid technology shall not disclose such
personal information to be used in mailing lists or to be used
for other commercial purposes not reasonably related to the
conduct of the utility's business. Electric utilities shall
comply with the consumer privacy requirements of the Personal
Information Protection Act. In the event a participating

09700HB0690ham001 - 69 - LRB097 03518 CEL 59067 a
utility receives revenues from the sale of information obtained
through Smart Grid technology that is not personal information,
the participating utility shall use such revenues to offset the
revenue requirement.
(e) On April 1 of each year beginning in 2013 and after
consultation with the Smart Grid Advisory Council, each
participating utility shall submit a report regarding the
progress it has made toward completing implementation of its
AMI Plan. This report shall:
(1) describe the AMI investments made during the prior
12 months and the AMI investments planned to be made in the
following 12 months;
(2) provide sufficient detail to determine the
utility's progress in meeting the metrics and milestones
identified by the utility in its AMI Plan; and
(3) identify any updates to the AMI Plan.
Within 21 days after the utility files its annual report,
the Commission shall have authority, either upon complaint or
its own initiative, but with reasonable notice, to enter upon
an investigation regarding the utility's progress in
implementing the AMI Plan as described in paragraph (1) of this
subsection (e). If the Commission finds, after notice and
hearing, that the participating utility's progress in
implementing the AMI Plan is materially deficient for the given
plan year, then the Commission shall issue an order requiring
the participating utility to devise a corrective action plan,

09700HB0690ham001 - 70 - LRB097 03518 CEL 59067 a
subject to Commission approval and oversight, to bring
implementation back on schedule consistent with the AMI Plan.
The Commission's order must be entered within 90 days after the
utility files its annual report. If the Commission does not
initiate an investigation within 21 days after the utility
files its annual report, then the filing shall be deemed
accepted by the Commission. The utility shall not be required
to suspend implementation of its AMI Plan during any Commission
investigation.
The participating utility's annual report regarding AMI
Plan year 10 shall contain a statement verifying that the
implementation of its AMI Plan is complete, provided, however,
that if the utility is subject to a corrective action plan that
extends the implementation period beyond 10 years, the utility
shall include the verification statement in its final annual
report. Following the date of a Commission order approving the
final annual report or the date on which the final report is
deemed accepted by the Commission, the utility's annual
reporting obligations under this subsection (d) shall
terminate, provided, however, that the utility shall have a
continuing obligation to provide information, upon request, to
the Commission and Smart Grid Advisory Council regarding the
AMI Plan.
(f) Each participating utility shall pay a pro rata share,
based on number of customers, of $5,000,000 per year to the
trust or foundation established pursuant to Section 16-108.7 of

09700HB0690ham001 - 71 - LRB097 03518 CEL 59067 a
this Act for each plan year of the AMI Plan, which shall be
used for purposes of providing customer education regarding
smart meters and related consumer-facing technologies and
services and 70% of which shall be a recoverable expense;
provided that other reasonable amounts expended by the utility
for such consumer education shall not be subject to the 70%
limitation of this subsection.
(g) Within 60 days after the Commission approves a
participating utility's AMI Plan pursuant to subsection (c) of
this Section, the participating utility, after consultation
with the Smart Grid Advisory Council, shall file a proposed
tariff with the Commission that offers an opt-in market-based
peak time rebate program to all residential retail customers
with smart meters that is designed to provide, in a
competitively neutral manner, rebates to those residential
retail customers that curtail their use of electricity during
specific periods that are identified as peak usage periods. The
total amount of rebates shall be the amount of compensation the
utility obtains through markets or programs at the applicable
regional transmission organization. The utility shall make all
reasonable attempts to secure funding for the peak time rebate
program through markets or programs at the applicable regional
transmission organization. The rules and procedures for
consumers to opt-in to the peak time rebate program shall
include electronic sign-up, be designed to maximize
participation, and be included on the utility's website. The

09700HB0690ham001 - 72 - LRB097 03518 CEL 59067 a
Commission shall monitor the performance of programs
established pursuant to this subsection (g) and shall order the
termination or modification of a program if it determines that
the program is not, after a reasonable period of time for
development of at least 4 years, resulting in net benefits to
the residential customers of the participating utility.
(h) If Section 16-108.5 of this Act becomes inoperative
with respect to one or more participating utilities as set
forth in subsection (g) or (h) of that Section, then Sections
16-108.5, 16-108.6, 16-108.7, and 16-108.8 of this Act shall
become inoperative as to each affected utility and its service
area on the same date as Section 16-108.5 becomes inoperative.
(Source: 09700SB1652enr.)
(220 ILCS 5/16-108.7)
Sec. 16-108.7. Illinois Science and Energy Innovation
Trust.
(a) Within 90 days of the effective date of this amendatory
Act of the 97th General Assembly, the members of the Smart Grid
Advisory Council established pursuant to Section 16-108.6 of
this Act, or a majority of the members thereof, shall cause to
be established an Illinois science and energy innovation trust
or foundation for the purposes of providing financial and
technical support and assistance to entities, public or
private, within the State of Illinois including, but not
limited to, units of State and local government, educational

09700HB0690ham001 - 73 - LRB097 03518 CEL 59067 a
and research institutions, corporations, and charitable,
educational, environmental and community organizations, for
programs and projects that support, encourage or utilize
innovative technologies or other methods of modernizing the
State's electric grid that will benefit the public by promoting
economic development in Illinois. Such activities shall be
supported through grants, loans, contracts, or other programs
designed to assist and further benefit technological advances
in the area of electric grid modernization and operation. The
trust or foundation shall also be eligible for receipt of other
energy and environmental grant opportunities, from public or
private sources. The trust or foundation shall not be a
governmental entity.
(b) Funds received by the trust or foundation pursuant to
subsection (f) of Section 16-108.6 of this Act shall be used
solely for the purpose of providing consumer education
regarding smart meters and related consumer-facing
technologies and services and the peak time rebate program
described in subsection (g) of Section 16-108.6 of this Act.
Thirty percent of such funds received from each participating
utility shall be used by the trust or foundation for purposes
of providing such education to each participating utility's
low-income retail customers, including low-income senior
citizens.
The trust or foundation shall use all funds received
pursuant to subsection (f) of Section 16-108.6 of this Act in a

09700HB0690ham001 - 74 - LRB097 03518 CEL 59067 a
manner that reflects the unique needs and characteristics of
each participating utility's service territory and in
proportion to each participating utility's payment.
(c) Such trust or foundation shall be governed by a
declaration of trust or articles of incorporation and bylaws
which shall, at a minimum, provide the following:
(1) There shall initially be 9 7 trustees of the trust
or foundation, which shall consist of the members of the
Smart Grid Advisory Council established pursuant to
Section 16-108.6 of this Act. Subsequently, the
participating utilities shall appoint one trustee and the
Clean Energy Trust shall appoint one non-voting trustee who
shall provide expertise regarding early stage investment
in Smart Grid projects.
(2) All trustees shall be entitled to reimbursement for
reasonable expenses incurred on behalf of the trust in the
performance of their duties as trustees. All such
reimbursements shall be paid out of the trust.
(3) Trustees shall be appointed within 60 days after
the creation of the trust or foundation and shall serve for
a term of 5 years commencing upon the date of their
respective appointments, until their respective successors
are appointed and qualified.
(4) A vacancy in the office of trustee shall be filled
by the person holding the office responsible for appointing
the trustee whose death or resignation creates the vacancy,

09700HB0690ham001 - 75 - LRB097 03518 CEL 59067 a
and a trustee appointed to fill a vacancy shall serve the
remainder of the term of the trustee whose resignation or
death created the vacancy.
(5) The trust or foundation shall have an indefinite
term and shall terminate at such time as no trust assets
remain.
(6) The allocation and disbursement of funds for the
various purposes for which the trust or foundation is
established shall be determined by the trustees in
accordance with the declaration of trust or the articles of
incorporation and bylaws.
(7) The trust or foundation shall be authorized to
employ an executive director and other employees, or
contract management of the trust or foundation in its
entirety to an outside organization found suitable by the
trustees, to enter into leases, contracts and other
obligations on behalf of the trust or foundation, and to
incur expenses that the trustees deem necessary or
appropriate for the fulfillment of the purposes for which
the trust or foundation is established, provided, however,
that salaries and administrative expenses incurred on
behalf of the trust or foundation shall not exceed 3% of
the trust's principal value, or $750,000, whichever is
greater, in any given year. The trustees shall not be
compensated by the trust or foundation.
(8) The trustees may create and appoint advisory boards

09700HB0690ham001 - 76 - LRB097 03518 CEL 59067 a
or committees to assist them with the administration of the
trust or foundation, and to advise and make recommendations
to them regarding the contribution and disbursement of the
trust or foundation funds.
(9) All funds dispersed by the trust or foundation for
programs and projects to meet the objectives of the trust
or foundation as enumerated in this Section shall be
subject to a peer-review process as determined by the
trustees. This process shall be designed to determine, in
an objective and unbiased manner, those programs and
projects that best fit the objectives of the trust or
foundation. In each fiscal year the trustees shall
determine, based solely on the information provided
through the peer-review process, a budget for programs and
projects for that fiscal year.
(10) The trustees shall administer a Smart Grid
education fund from which it shall make grants to qualified
not-for-profit organizations for the purpose of educating
customers with regard to smart meters and related
consumer-facing technologies and services. In making such
grants the trust or foundation shall strongly encourage
grantees to coordinate to the extent practicable and
consider recommendations from the participating utilities
regarding the development and implementation of customer
education plans.
(11) One of the objectives of the trust or foundation

09700HB0690ham001 - 77 - LRB097 03518 CEL 59067 a
is to remain self-funding. In order to meet this objective,
the trustees may sign agreements with those entities
receiving funding that provide for license fees,
royalties, or other payments to the trust or foundation
from such entities that receive support for their product
development from the trust or foundation. Such payments,
however, shall be contingent on the commercialization of
such products, services, or technologies enabled by the
funding provided by the trust or foundation.
(d) The trustees shall notify each participating utility as
defined in Section 16-108.5 of this Act of the formation of the
trust or foundation. Within 90 days after receipt of the
notification, each participating utility that is not a
combination utility as defined in Section 16-108.5 of this Act
shall contribute $15,000,000 to the trust or foundation, and
each participating utility that is a combination utility, as
defined in Section 16-108.5 of this Act, shall contribute
$7,500,000 to the trust or foundation established pursuant to
this Section. Such contributions shall not be a recoverable
expense.
(e) If Section 16-108.5 of this Act becomes inoperative
with respect to one or more participating utilities as set
forth in subsection (g) or (h) of that Section, then Sections
16-108.5, 16-108.6, 16-108.7, and 16-108.8 of this Act shall
become inoperative as to each affected utility and its service
area on the same date as Section 16-108.5 becomes inoperative.

09700HB0690ham001 - 78 - LRB097 03518 CEL 59067 a
(Source: 09700SB1652enr.)
(220 ILCS 5/16-128)
Sec. 16-128. Provisions related to utility employees
during the mandatory transition period.
(a) The General Assembly finds:
(1) The reliability and safety of the electric system
has depended and depends on a workforce of skilled and
dedicated employees, equipped with technical training and
experience.
(2) The integrity and reliability of the system also
requires the industry's commitment to invest in regular
inspection and maintenance, to assure that it can withstand
the demands of heavy service requirements and emergency
situations.
(3) It is in the State's interest to protect the
interests of utility employees who have and continue to
dedicate themselves to assuring reliable service to the
citizens of this State, and who might otherwise be
economically displaced in a restructured industry.
The General Assembly further finds that it is necessary to
assure that employees of electric utilities and employees of
contractors or subcontractors performing work on behalf of an
electric utility operating in the deregulated industry have the
requisite skills, knowledge, training, experience, and
competence to provide reliable and safe electrical service

09700HB0690ham001 - 79 - LRB097 03518 CEL 59067 a
under this Act .
The General Assembly also finds that it is necessary to
assure that employees of alternative retail electric suppliers
and employees of contractors or subcontractors performing work
on behalf of an alternative retail electric supplier operating
in the deregulated industry have the requisite skills,
knowledge, training, experience, and competence to provide
reliable and safe electrical service under this Act.
To ensure that these findings and prerequisites for
reliable and safe electrical service continue to prevail, each
alternative retail electric supplier, electric utility, and
contractors and subcontractors performing work on behalf of an
electric utility or alternative retail electric supplier must
demonstrate the competence of their respective employees to
work on the distribution system.
The knowledge, skill, training, experience, and competence
levels to be demonstrated shall be consistent with those
required of or by the electric utilities in this State as of
January 1, 2007, with respect to their employees and employees
of contractors or subcontractors performing work on their
behalf. Nothing in this Section shall prohibit an electric
utility from establishing knowledge, skill, training,
experience, and competence levels greater than those required
as of January 1, 2007.
An adequate demonstration of requisite knowledge, skill,
training, experience, and competence shall include, at a

09700HB0690ham001 - 80 - LRB097 03518 CEL 59067 a
minimum, completion or current participation and ultimate
completion by the employee of an accredited or otherwise
recognized apprenticeship program for the particular craft,
trade or skill, or specified and several years of employment
performing a particular work function that is utilized by an
electric utility.
Notwithstanding any law, tariff, Commission rule, order,
or decision to the contrary, the Commission shall have an
affirmative statutory obligation to ensure that an electric
utility is employing employees, contractors, and
subcontractors with employees who meet the requirements of
subsection (a) of this Section when installing, constructing,
operating, and maintaining generation, transmission, or
distribution facilities and equipment within this State
pursuant to any provision in this Act or any Commission order,
rule, or decision.
For purposes of this Section, "distribution facilities and
equipment" means any and all of the facilities and equipment,
including, but not limited to, substations, distribution
feeder circuits, switches, meters, protective equipment,
primary circuits, distribution transformers, line extensions
and service extensions both above or below ground, conduit,
risers, elbows, transformer pads, junction boxes, manholes,
pedestals, conductors, and all associated fittings that
connect the transmission or distribution system to either the
weatherhead on the retail customer's building or other

09700HB0690ham001 - 81 - LRB097 03518 CEL 59067 a
structure for above ground service or to the terminals on the
meter base of the retail customer's building or other structure
for below ground service.
To implement this requirement for alternative retail
electric suppliers, the Commission, in determining that an
applicant meets the standards for certification as an
alternative retail electric supplier, shall require the
applicant to demonstrate (i) that the applicant is licensed to
do business, and bonded, in the State of Illinois; and (ii)
that the employees of the applicant that will be installing,
operating, and maintaining generation, transmission, or
distribution facilities within this State, or any entity with
which the applicant has contracted to perform those functions
within this State, have the requisite knowledge, skills,
training, experience, and competence to perform those
functions in a safe and responsible manner in order to provide
safe and reliable service, in accordance with the criteria
stated above.
(b) The General Assembly finds, based on experience in
other industries that have undergone similar transitions, that
the introduction of competition into the State's electric
utility industry may result in workforce reductions by electric
utilities which may adversely affect persons who have been
employed by this State's electric utilities in functions
important to the public convenience and welfare. The General
Assembly further finds that the impacts on employees and their

09700HB0690ham001 - 82 - LRB097 03518 CEL 59067 a
communities of any necessary reductions in the utility
workforce directly caused by this restructuring of the electric
industry shall be mitigated to the extent practicable through
such means as offers of voluntary severance, retraining, early
retirement, outplacement and related benefits. Therefore,
before any such reduction in the workforce during the
transition period, an electric utility shall present to its
employees or their representatives a workforce reduction plan
outlining the means by which the electric utility intends to
mitigate the impact of such workforce reduction on its
employees.
(c) In the event of a sale, purchase, or any other transfer
of ownership during the mandatory transition period of one or
more Illinois divisions or business units, and/or generating
stations or generating units, of an electric utility, the
electric utility's contract and/or agreements with the
acquiring entity or persons shall require that the entity or
persons hire a sufficient number of non-supervisory employees
to operate and maintain the station, division or unit by
initially making offers of employment to the non-supervisory
workforce of the electric utility's division, business unit,
generating station and/or generating unit at no less than the
wage rates, and substantially equivalent fringe benefits and
terms and conditions of employment that are in effect at the
time of transfer of ownership of said division, business unit,
generating station, and/or generating units; and said wage

09700HB0690ham001 - 83 - LRB097 03518 CEL 59067 a
rates and substantially equivalent fringe benefits and terms
and conditions of employment shall continue for at least 30
months from the time of said transfer of ownership unless the
parties mutually agree to different terms and conditions of
employment within that 30-month period. The utility shall offer
a transition plan to those employees who are not offered jobs
by the acquiring entity because that entity has a need for
fewer workers. If there is litigation concerning the sale, or
other transfer of ownership of the electric utility's
divisions, business units, generating station, or generating
units, the 30-month period will begin on the date the acquiring
entity or persons take control or management of the divisions,
business units, generating station or generating units of the
electric utility.
(d) If a utility transfers ownership during the mandatory
transition period of one or more Illinois divisions, business
units, generating stations or generating units of an electric
utility to a majority-owned subsidiary, that subsidiary shall
continue to employ the utility's employees who were employed by
the utility at such division, business unit or generating
station at the time of the transfer under the same terms and
conditions of employment as those employees enjoyed at the time
of the transfer. If ownership of the subsidiary is subsequently
sold or transferred to a third party during the transition
period, the transition provisions outlined in subsection (c)
shall apply.

09700HB0690ham001 - 84 - LRB097 03518 CEL 59067 a
(e) The plant transfer provisions set forth above shall not
apply to any generating station which was the subject of a
sales agreement entered into before January 1, 1997.
(Source: P.A. 90-561, eff. 12-16-97; 09700SB1652enr.)
Section 99. Effective date. This Act takes effect upon
becoming law.".