Bill Text: IN SB0510 | 2013 | Regular Session | Engrossed
Bill Title: Substitute natural gas (SNG) contracts.
Spectrum: Slight Partisan Bill (Republican 16-7)
Status: (Engrossed - Dead) 2013-04-10 - Amendment 19 (Lawson), prevailed; Roll Call 443: yeas 72, nays 22 [SB0510 Detail]
Download: Indiana-2013-SB0510-Engrossed.html
Citations Affected: IC 4-4; noncode.
Effective: Upon passage; May 15, 2013.
Young R Michael, Randolph, Stoops, Head, Landske, Arnold J, Young R, Skinner, Miller Pete, Breaux
(HOUSE SPONSORS _ CROUCH, LEONARD, BRAUN, DELANEY)
January 14, 2013, read first time and referred to Committee on Utilities.
February 21, 2013, amended, reported favorably _ Do Pass.
February 25, 2013, read second time, ordered engrossed. Engrossed.
February 26, 2013, read third time, passed. Yeas 47, nays 3.
March 5, 2013, read first time and referred to Committee on Utilities and Energy.
April 4, 2013, amended, reported _ Do Pass.
Digest Continued
regulatory commission (IURC). Authorizes the IURC, after notice and hearing, to approve, reject, or modify a final purchase contract if in the public interest. Specifies certain factors the IURC must consider before taking action. Requires the IURC to issue a final order within 180 business days. Provides that a party to a final order is entitled to an expedited appeal under rules to be adopted by the supreme court. Authorizes the IURC to adopt rules, including rules establishing filing deadlines. Requires the IURC to study the sales price of natural gas and report the study results to the regulatory flexibility committee in an electronic format not later than November 1, 2013.
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A BILL FOR AN ACT to amend the Indiana Code concerning state
offices and administration.
(1) For a purchase contract that is entered into before January 15, 2011, a contract that:
necessary by the authority.
(2) For a purchase contract, including any amendments,
addenda, or other modifications made or added to the
contract at any time, that is entered into after January 14,
2011, a contract that:
(A) is entered into by the authority and a producer of SNG
for the sale and purchase of SNG;
(B) has a thirty (30) year term;
(C) provides a guarantee of savings (as defined in section
10.5 of this chapter) for retail end use customers in a
manner consistent with the requirements of section
14(c)(4) of this chapter; and
(D) contains other terms and conditions determined
necessary by the authority.
(1) The furnishing of reliable supplies of reasonably priced natural gas for sales to retail customers is essential for the well being of the people of Indiana. Natural gas prices are volatile, and energy utilities have been unable to mitigate completely the effects of the volatility.
(2) Long term contracts for the purchase of SNG between the authority and SNG producers will enhance the receipt of federal incentives for the development, construction, and financing of new coal gasification facilities in Indiana.
(3) The authority's participation in and oversight of the purchase, sale, and delivery of SNG to retail end use customers is critical to obtain low cost financing for the construction of new coal gasification facilities.
(4) Obtaining low cost financing for the construction of new coal gasification facilities is necessary to allow retail end use customers to enjoy the benefits of a reliable, reasonably priced,
and long term energy supply.
(b) In addition to the findings set forth in subsection (a), the
general assembly makes the following findings:
(1) With respect to pending litigation concerning contracts
entered into under this chapter, the general assembly defers
to the constitutional role and independence of the judicial
branch.
(2) The general assembly recognizes the expertise and
independence of the commission in matters concerning
Indiana's natural gas ratepayers.
(3) Legislative power includes the power to amend and repeal
existing laws. The legislature has no power to enact a law or
to make a contract or arrangement that in any way
surrenders or abridges this legislative power. The act of one
(1) legislature is not binding upon a future legislature.
(4) An action by a general assembly, including the enactment
of legislation, to protect the public interest is a proper exercise
of the police power and is not intended to impair a long term
contract for the purchase of SNG.
(5) New discoveries of natural gas supplies and development
of advanced drilling techniques may affect the determination
of whether a long term contract for the purchase of SNG is in
the public interest.
(6) Realizing savings at intervals throughout the term of a
contract for the purchase of SNG protects retail end use
customers and serves the public interest.
(b) The authority shall submit
(1) A final purchase contract, including any amendments, addenda, or other modifications made or added to the contract at any time.
(2) Any other agreements entered into between the authority and a producer of SNG.
(c) After notice and a hearing, the commission may approve, reject, or modify a final purchase contract that is filed with, pending before, or remanded or otherwise returned to the jurisdiction of the commission on or after May 15, 2013, if the
commission finds that such action is in the public interest. The
commission shall consider the following before finding that an
action under this subsection is in the public interest:
(1) Whether the final purchase contract is structured in a way
that lessens the impact of any price volatility in the natural
gas market on retail end use customers.
(2) Whether the assumptions underlying the model used to
calculate the purchase price of SNG under the final purchase
contract, including assumptions about the future price of
natural gas and coal and the value of future byproducts of the
coal gasification facility, adequately apportion financial risk
between the SNG producer and retail end use customers.
(3) The findings of any study conducted by the commission on
the natural gas market and reported to the regulatory
flexibility committee established under IC 8-1-2.6-4.
(4) Whether a final purchase contract provides an actual
guarantee that retail end use customers are able to realize
savings throughout the term of the final purchase contract at
intervals established by the commission.
(5) Any other factors the commission considers necessary.
The commission shall issue a final order not more than one
hundred eighty (180) business days after the date on which the
authority submits the final purchase contract to the commission
under subsection (b)(1).
(d) A party to an order issued under subsection (c) is entitled to
an expedited appeal of the order under rules to be adopted by the
supreme court.
(e) The commission may adopt rules under IC 4-22-2 to carry
out the requirements of this section. A rule adopted under this
subsection must establish filing and other procedural deadlines for
all parties to a hearing under subsection (c).
(1) conduct a study of the natural gas market, including:
(A) natural gas prices on both the open and captive markets; and
(B) the effect of the availability of substitute natural gas and shale gas on natural gas prices; and
(2) report the study results in an electronic format under IC 5-14-6 to the regulatory flexibility committee established under IC 8-1-2.6-4.
(b) This SECTION expires December 31, 2013.
