2013 Indiana Code TITLE 8. UTILITIES AND TRANSPORTATION ARTICLE 1. UTILITIES GENERALLY CHAPTER 2.3. ELECTRICITY SUPPLIERS' SERVICE AREA ASSIGNMENTS
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IC 8-1-2.3
Chapter 2.3. Electricity Suppliers' Service Area Assignments
IC 8-1-2.3-1
Legislative findings and declaration of policy
Sec. 1. Legislative Findings and Declaration of Policy. It is
declared to be in the public interest that, in order to encourage the
orderly development of coordinated statewide electric service at
retail, to eliminate or avoid unnecessary duplication of electric utility
facilities, to prevent the waste of material and resources, and to
promote economical, efficient, and adequate electric service to the
public, the currently unincorporated areas of Indiana shall be divided
into designated geographic areas within which an assigned electricity
supplier has the sole right to furnish retail electric service to
customers.
As added by Acts 1980, P.L.69, SEC.1.
IC 8-1-2.3-2
Definitions
Sec. 2. (a) The definitions in this section apply throughout this
chapter.
(b) "Electricity supplier" means a public utility, a local district
rural electric membership corporation, or a municipally owned
electric utility which furnishes retail electric service to the public.
(c) "Retail electric service" means electric service furnished to a
customer for ultimate consumption, but does not include wholesale
electric service furnished by an electricity supplier to another
electricity supplier for resale.
(d) "Existing electric distribution line" means an electric
conductor which on January 1, 1979, was being used for the
distribution or delivery of retail electric service.
(e) "Assigned service area" means the designated geographic area
within the boundaries of which an electricity supplier is authorized
to furnish all retail electric service, as provided in this chapter.
(f) "Municipality" means a city or town.
(g) "Existing municipal limits" means the corporate boundaries of
any municipality as such boundaries existed on January 1, 1979.
As added by Acts 1980, P.L.69, SEC.1. Amended by P.L.23-1988,
SEC.30.
IC 8-1-2.3-3
Assigned service areas
Sec. 3. Assigned Service Areas. (a) Unless otherwise agreed upon
between adjacent electricity suppliers, all areas inside existing
municipal limits are hereby assigned to the electricity supplier
serving a plurality of the electric meters within the municipality on
January 1, 1979.
(b) Where two (2) or more electricity suppliers are rendering retail
electric service within existing municipal limits, those suppliers shall
take one (1) or more of the following actions to assure that only one
(1) electricity supplier shall serve within the existing municipal
limits:
(1) The electricity supplier serving a plurality of electric meters
within the municipality on January 1, 1979, may purchase the
electric utility property of any other electricity supplier which
is devoted to retail electric service and is located within the
existing municipal limits, at its then reproduction cost new
depreciated value plus severance damages.
(2) At the option of the electricity supplier serving a plurality of
electric meters within the municipality on January 1, 1979, and
subject to commission approval, the electricity suppliers may
exchange all or part of the electric utility property located
outside of the existing municipal limits for the electric utility
property located within the existing municipal limits.
(3) If the affected electricity suppliers do not agree upon a
purchase or exchange of the electric utility property before
September 1, 1980, the commission shall determine the
appropriate purchase price for the electric utility property
according to subsection (b)(1) of this section.
(c) On or before July 1, 1981, each electricity supplier in each
county shall exchange with all other electricity suppliers in the
county a map or maps showing all of its existing electric distribution
lines in the county which are relevant to the assignment of service
areas outside existing municipal limits and any other information it
considers useful in determining the boundaries of an assigned service
area.
(d) Until otherwise agreed upon between electricity suppliers or
ordered by the commission under section 3(g) of this chapter, the
boundaries of the assigned service area for each adjacent electricity
supplier outside existing municipal limits shall be set as a line
equidistant from its existing electric distribution lines and the nearest
existing electric distribution lines of any other electricity supplier;
the resulting assigned service area outside existing municipal limits
of an electricity supplier will be that area which is closer to the
existing electric distribution lines of a supplier than to the existing
electric distribution lines of any other electricity supplier.
(e) Each electricity supplier shall negotiate with all adjacent
electricity suppliers as soon as practicable in an effort to agree on the
boundaries of the service areas to be assigned.
(f) Maps depicting the boundaries of such proposed service area
assignments shall be prepared by each electricity supplier for each
county in which the electricity supplier provides electric retail
service, and shall be filed, together with a petition requesting
approval and assignment of such service areas with the commission
on or before July 1, 1982, or on such other date as the commission
may determine, but in any event on or before March 1, 1983.
Thereafter, the commission shall hold a public hearing regarding the
proposed service areas, after publication of notice of the hearing at
least ten (10) days before the hearing in the county or counties in
which such proposed service areas are located. If the commission
finds that the proposed service areas comply with this chapter, it
shall issue an order within twelve (12) months of the filing of the
petition and related maps, approving and assigning the service areas
as designated on the prepared maps.
(g) If two (2) or more adjacent electricity suppliers cannot agree
upon the boundary line or lines between their respective proposed
service areas on or before July 1, 1982, or such other date as the
commission may determine, but in any event on or before March 1,
1983, the commission on its own motion or upon petition of one (1)
of the electricity suppliers shall hold a public hearing regarding the
location of the boundary line or lines, after publication of notice of
the hearing at least ten (10) days before the hearing in the county or
counties in which the boundary line or lines are located. The
commission shall determine the boundary line or lines based as
nearly as practicable upon a line equidistant between the existing
electric distribution lines of the adjacent electricity suppliers,
consistent with good utility practice and public convenience and
necessity. The commission shall issue an order determining the
boundary line or lines and assigning the service areas, and shall
direct the parties to file with the commission maps showing such
assigned service areas. If the commission determines that the maps
comply with its order, it shall issue a supplemental order approving
the assigned service areas as designated on the maps.
(h) Once established according to this section, the boundaries of
assigned service areas may not be changed except as provided in
section 6 of this chapter.
As added by Acts 1980, P.L.69, SEC.1. Amended by Acts 1982,
P.L.71, SEC.1.
IC 8-1-2.3-4
Service area rights
Sec. 4. Service Area Rights. (a) As long as an electricity supplier
continues to provide adequate retail service, it shall have the sole
right to furnish retail electric service to each present and future
consumer within the boundaries of its assigned service area and no
other electricity supplier shall render or extend retail electric service
within its assigned service area unless the electricity supplier with
the sole right consents thereto in writing and the commission
approves. This subsection does not prevent the commission from
exercising its authority under IC 8-1-2-69.
(b) If an electricity supplier unlawfully renders or extends retail
electric service within the assigned service area of another electricity
supplier, the electricity supplier which has the sole right to furnish
retail electric service in that assigned service area may bring an
action in the circuit or superior court of the county where such
assigned service area is located to enjoin the other electricity supplier
from rendering or extending such unlawful retail electric service.
If a violation is proved, the violator shall pay to the aggrieved
electricity supplier the gross revenues derived by the violator from
the sale of electric service within the assigned service area of the
aggrieved electricity supplier, all witness fees, court costs and
reasonable attorneys' fees incurred in any litigation brought to
enforce this section. Payment of damages, fees and costs does not
entitle a violator to furnish retail electric service in such assigned
service area. All such actions or proceedings must be brought within
three (3) years after the violation occurs.
As added by Acts 1980, P.L.69, SEC.1.
IC 8-1-2.3-5
Effect of incorporation, annexation, consolidation, or merger
Sec. 5. Effect of Incorporation, Annexation, Consolidation or
Merger. After January 1, 1979, the inclusion by incorporation,
annexation, consolidation, or merger of any part of the assigned
service area of an electricity supplier does not impair or affect the
rights of an electricity supplier to continue to solely furnish and
extend retail electric service throughout any part of its assigned
service area, except as provided in section 6 of this chapter.
As added by Acts 1980, P.L.69, SEC.1.
IC 8-1-2.3-6
Change of service area boundaries
Sec. 6. The boundaries of the assigned service areas of electricity
suppliers may not be changed except under any one (1) of the
following circumstances:
(1) If a municipality which owns and operates an electric utility
system furnishing retail electric service to the public annexes an
area beyond the assigned service area of its municipally owned
electric utility, the municipally owned electric utility may
petition the commission to change the assigned service area of
the municipally owned electric utility to include the annexed
area, according to the following procedures:
(A) The municipally owned electric utility shall file its
petition with the commission not later than sixty (60) days
after the annexation becomes effective. The petition must
include a certified copy of the annexation ordinance, which
serves as conclusive evidence that the area has been lawfully
annexed and is part of the municipality. After the filing of a
petition under this subdivision, the commission shall
promptly enter an order changing the assigned service area
facet maps of the municipally owned electric utility and
incumbent electricity suppliers to include the annexed area
within the assigned service area of the municipally owned
electric utility and giving the right to serve and immediate
possession to the municipally owned electric utility. The
commission order is enforceable in court pending an appeal
of that order. An appellant from a court order enforcing a
commission order under this subdivision is not entitled to a
stay of the court order pending appeal. However, this
subdivision does not apply to incorporations, consolidations,
mergers, or annexations that are under IC 36-4-3-4(a)(3),
IC 36-4-3-4(b), IC 36-4-3-4(h), or IC 36-4-3-4.1 or that are
not contiguous under IC 36-4-3-13(b) or IC 36-4-3-13(c).
(B) Not later than thirty (30) days after filing a petition
under this subdivision, the municipally owned electric utility
shall determine for each affected incumbent electricity
supplier and pay to that supplier an amount not less than the
value of all the electric utility property of the incumbent
electricity supplier that is devoted to furnishing retail
electric service within the additional assigned service area at
its then reproduction cost new depreciated value. In addition,
the municipally owned electric utility shall pay the
incumbent electricity supplier severance damages in an
amount equal to:
(i) the value of the incumbent electricity supplier's
distribution and substation facilities dedicated to and
located within the annexed area or relocated by reason of
the annexation or an amount equal to two and one-half (2
1/2) times the incumbent electricity supplier's gross
revenues from electricity sales in the annexed area during
the twelve (12) month period immediately preceding the
date the annexation ordinance became effective,
whichever is greater; plus
(ii) if additional permanent service locations or service
accounts are established in the annexed area during the
five (5) year period beginning on the effective date of the
annexation ordinance, one-tenth of one cent ($0.001) for
each kilowatt hour of electricity sold to each of those
permanent service locations or service accounts for sales
that occur during a five (5) year period beginning on the
date each service location or service account is
established, up to a maximum of one hundred seventy
thousand (170,000) kilowatt hours per service account or
service location for each monthly billing period.
However, the municipally owned electric utility is not
required to pay severance damages under item (ii) if, at the
time each annual payment otherwise would accrue, it is
purchasing all of its requirements for electric power and
energy, except for generation directly provided by the
municipally owned electric utility or by a customer, from the
incumbent electricity supplier. Severance damages must be
paid not later than thirty (30) days after the end of each
calendar year in which severance damages have accrued.
The municipally owned electric utility and incumbent
electricity suppliers shall cooperate to calculate the amount
of any severance damages and shall furnish to each other all
information and records reasonably necessary for the
determination and verification of severance damages. If the
municipally owned electric utility and incumbent electricity
suppliers cannot agree on the amount of severance damages
the municipally owned electric utility is to pay, the
commission shall determine the amount and order payment
in accordance with this clause. Not later than twenty (20)
days after making a payment, the municipally owned electric
utility shall certify to the commission and to any affected
incumbent electricity supplier that it has paid the amounts
required under this clause.
(C) If the municipally owned electric utility fails to make a
payment under clause (B), an affected incumbent electricity
supplier may, not later than sixty (60) days after the payment
is due and after giving the municipally owned electric utility
reasonable notice of and an opportunity to cure the defect,
file with the commission a petition alleging that a payment
due under clause (B) has not been made. If the commission
finds after notice and hearing that any payments owed to the
incumbent electricity supplier have not been timely and fully
paid, the commission shall order the municipally owned
electric utility to pay:
(i) the delinquent payments by a date determined by the
commission;
(ii) accrued interest at the rate set forth in IC 24-4.6-1-102;
and
(iii) the incumbent electricity supplier's costs of filing and
prosecuting a petition under this clause.
If the commission finds against the incumbent electricity
supplier, it shall order the incumbent electricity supplier to
pay the costs incurred by the municipally owned electric
utility in defending against the incumbent electricity
supplier's petition.
(D) A certified copy of a final commission order that:
(i) determines and orders the payment of severance
damages under clause (B); or
(ii) orders the payment of delinquent payments, interest,
and costs under clause (C);
may be filed with the clerk of the circuit or superior court of
any county in which part or all of the annexed area is
located. A commission order that is filed in a court under
this clause may be enforced and executed in the same
manner as if it were a final judgment of that court.
(2) Upon mutual agreement of the affected electricity suppliers
and approval of the commission. If notice of a verified request
for a change of boundary lines by mutual agreement under this
subdivision is published in a newspaper of general circulation
in every county in which the boundary lines are located and an
affected electricity customer does not request a hearing within
twenty (20) days of the last date of publication, the commission
may approve the change without a hearing. The commission
shall approve a boundary line change under this subdivision
unless the commission finds, after a public hearing, that the
change would cause:
(A) duplication of electric utility facilities;
(B) waste of materials or resources; or
(C) uneconomic, inefficient, or inadequate electric service to
the public.
(3) In the case where a landowner owns a single tract of land
that is intersected by the boundary lines of two (2) or more
assigned service areas, and retail electric service can best be
supplied by only one (1) electricity supplier, or in the case
where a customer or customers are housed in a single structure
or constitute a single governmental, industrial, or institutional
operation, and the electricity suppliers involved are unable to
agree which shall furnish the electric service, any of the
electricity suppliers may submit the matter to the commission
for its determination based upon public convenience and
necessity. If, after notice and hearing, the commission
determines that one (1) or more electricity suppliers are to
supply the required retail electric service and the boundaries of
an assigned service area are to be changed, the assigned service
area maps of the electricity suppliers shall be changed to reflect
the new boundaries.
As added by Acts 1980, P.L.69, SEC.1. Amended by P.L.91-1985,
SEC.1; P.L.19-1986, SEC.27; P.L.79-1996, SEC.1;
P.L.255-1997(ss), SEC.7; P.L.217-1999, SEC.1; P.L.56-2002,
SEC.1.
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