56-234.3 - Approval of expenditures for and monitoring of new generation facilities and projected operation programs of electric utilities.
§ 56-234.3. Approval of expenditures for and monitoring of new generationfacilities and projected operation programs of electric utilities.
Prior to construction or financial commitments therefor, any electric utilitysubject to the jurisdiction of the State Corporation Commission intending toconstruct any new generation facility capable of producing 100 megawatts ormore of electric energy shall submit to the State Corporation Commission apetition setting forth the nature of the proposed construction and thenecessity therefor in relation to its projected forecast of programs ofoperation. Such petition shall include (i) the utility's preliminaryconstruction plans, (ii) the methods by which the work will be contracted, bycompetitive bid or otherwise, (iii) the names and addresses of thecontractors and subcontractors, when known, proposed to do such work, and(iv) the plan by which the public utility will monitor such construction toensure that the work will be done in a proper, expeditious and efficientmanner. The Commission, upon receipt of the petition, shall order that apublic hearing be held to assist it in accumulating as much relevant data aspossible in reaching its determination for the necessity of the proposedgeneration facility. The Commission shall review the petition, consider thetestimony given at the public hearing, and determine whether the proposedimprovements are necessary to enable the public utility to furnish reasonablyadequate service and facilities at reasonable and just rates. After makingits determination, the Commission shall enter an order within nine monthsafter the filing of such petition either approving or disapproving theproposed expenditure. Upon approval, the Commission shall set forth in itsorder terms and conditions it deems necessary for the efficient and properconstruction of the generation facility.
Every electric utility capable of producing 100 megawatts or more of electricenergy shall file with the Commission a projected forecast of its programs ofoperation, on such terms and for such time periods as directed by theCommission. Such a forecast shall include, but not be limited to, theanticipated required capacity to fulfill the requirements of the forecast,how the utility will achieve such capacity, the financial requirements forthe period covered, the anticipated sources of those financial requirements,the research and development procedures, where appropriate, of new energysources, and the budget for the research and development program.
In addition, the Commission shall investigate and monitor the majorconstruction projects of any public utility to assure that such projects arebeing conducted in an economical, expeditious, and efficient manner.
Whenever uneconomical, inefficient or wasteful practices, procedures, designsor planning are found to exist, the Commission shall have the authority toemploy, at the sole expense of the utility, qualified persons, answerablesolely to the Commission, who shall audit and investigate such practices,procedures, designs or planning and recommend to the Commission measuresnecessary to correct or eliminate such practices, procedures, designs orplanning.
Consistent with § 56-235.3, any public utility, electric or otherwise,seeking to pass through the cost of any capital project to its customers,shall have the burden of proving that such cost was incurred throughreasonable, proper and efficient practices, and to the extent that suchpublic utility fails to bear such burden of proof, such costs shall not bepassed on to its customers in its rate base.
The Commission shall have the authority to approve, disapprove, or alter theutility's program in a manner consistent with the best interest of thecitizens of the Commonwealth. The petitioning or filing public utility mayappeal the decision of the Commission to the Supreme Court of Virginia.
(1976, c. 701; 1977, c. 261; 1978, c. 700; 1984, cc. 453, 454; 1997, c. 138.)