Senate Bill 245

Last Action 02/23/23: to Natural Resources & Energy (S)
Title AN ACT relating to affordable and reliable energy for Kentucky.
Bill Documents Introduced
Bill Request Number 1611
Sponsors S. Funke Frommeyer, G. Williams
Summary of Original Version Create new sections of KRS Chapter 278 to define terms; allow an investor-owned electric utility to apply for a financing order to securitize deferred costs associated with retired or abandoned electric generating facilities and extraordinary storm costs; clarify that the electric utility may retire and replace the electric generation facility without matching the capacity or the technology of the retired or abandoned unit; establish the contents of an application for a financing order; exclude accumulated depreciation from the rate base; require the Public Service Commission to establish the process for a proceeding to review and render a decision on a financing order application; provide a 120-day time frame for the Public Service Commission to render a decision and issue an order; require the decision to be just and reasonable; clarify the process for judicial review; stipulate and conscribe the powers of the Public Service Commission when reviewing the application and the surcharge placed on customer bills for recovery of the securitized costs; allow the electric utility to cause the issuance of securitized bonds after an order has been approved by the Public Service Commission; specify the contents of the financing order; set the expiration date for the financing order after which the electric utility cannot cause securitized bonds to be issued; predicate the issuance of securitized bonds on a true sale of securitized property; allow for transfer and assignment of securitized property; require the utility to submit a formula for a true-up mechanism to reconcile amounts collected from ratepayers through a surcharge; allow the Public Service Commission to review clerical and mathematical aspects of the formula; specify the process and requirements for an issuance advice letter process and the parameters for the Public Service Commission to participate; provide that the interest in securitized property and the securitized surcharge are irrevocable; allow for the Public Service Commission to submit a disapproval order to stop the issuance of securitized bonds; allow for refinancing and refunding of securitized bonds; establish priority and perfection of lien and require the lien to be recorded in the Secretary of State office; specify prohibited actions to be undertaken by the Public Service Commission; specify the billing requirements when a financing is approved; establish a property right and interest in securitized property that can be transferred, pledged, or assigned; clarify nonrecourse to assets of the utility in the instance of default and that the securitized surcharge remains in cases of bankruptcy or insolvency; clarify that any person acquiring a utility under a financing order obtains the responsibility of performing the duties under the financing order regarding the securitized surcharge; establish the absolute transfer and clarify the factors that do not limit the true sale; clarify how to determine priority when there are conflicting interests; stipulate that the law of the Commonwealth regarding securitization of utility assets are these provisions and that securitization does not create a debt of the Commonwealth or its political subdivisions; create a severability clause if any provision is invalidated; create definitions for biogas and syngas affecting natural gas utilities regulated by the Public Service Commission; authorize the natural gas utility to file an application for a recovery mechanism for using innovative natural gas resources to establish needed infrastructure; require the Public Service Commission to allow recovery for an electric utility to recover reasonable expenses associated with obtaining an early site permit from the United States Nuclear Regulatory Commission; amend KRS 65A.050, 278.021, and 278.516 to conform; amend KRS 278.020 to require the Public Service Commission to consider the policy of the Commonwealth for electric utilities to own their own renewable electric generation when granting a certificate of convenience and necessity for the utility to construct renewable facilities; establish a rebuttable presumption that constructing a plant or facility with a projected cost of less than 3 percent of the utility's total net plant to be an ordinary extension of the system; require the final decision to be made in 120 days and if no action is taken the application is deemed approved; and amend KRS 355.9-109 to exempt securitized interests in securitized property from the Uniform Commercial Code dealing with secured transactions.
Index Headings of Original Version Energy - Electric utilities, investor-owned, securitization, plant retirement, storm costs
Fees - Investor-owned electric utilities, securitized surcharge, paid by customers
Public Utilities - Regulated utilities, deferred expenses held as regulatory assets, securitization
Sales - Electric utilities, electric generating units, reasonable attempt to sell before retirement
Securities - Investor-owned electric utilities, securitized property, securitized bonds
Bonds, Public - Investor-owned electric utilities, securitized property, securitized bonds


  • introduced in Senate
  • to Committee on Committees (S)
  • to Natural Resources & Energy (S)

Last updated: 11/9/2023 3:03 PM (EST)