2018 Louisiana Laws
Revised Statutes
TITLE 45 - Public Utilities and Carriers
RS 45:1163.2 - Establishment of rates
§1163.2. Establishment of rates
A. The industrial base of the state of Louisiana, upon which the economy of the state is heavily dependent, is highly energy-intensive, and the rise in the cost of electric power and competition from industries located outside the state where electric service is offered at significantly lower rates threatens the continued viability of those depressed energy-intensive industries in Louisiana. The legislature finds and declares that it is essential to the continued growth and development of the state and to the continued employment, prosperity, and welfare of the people of the state that such depressed energy-intensive industries now located in the state be encouraged to remain in operation in Louisiana. It is the purpose of this Section to encourage the retention of such industries, and the substantial number of jobs that they provide, by requiring the establishment of a rate structure for the provision of electric service that, together with other cost factors, may permit such industries in Louisiana to remain competitive with comparable industries located outside of the state.
B.(1) The Public Service Commission shall require all electric public utilities which provide or have provided service to a certified depressed energy-intensive industry to prepare and file alternative rate tariffs for firm and off-peak electric service to the depressed energy-intensive industry within thirty days of that certification. Since the generating investment at the time these industries located in the state was in gas and oil-fired generating facilities, the rate to be charged to depressed energy-intensive industry shall be based solely upon oil and/or gas-fired generation, and the monthly firm rate shall not exceed three dollars and fifty cents per kilowatt, in addition to the fuel cost, and the monthly off-peak rate shall not exceed one dollar and fifty cents per kilowatt, in addition to the fuel cost and both rates shall be subject to approval of the commission.
(2) The fuel costs for firm service to depressed energy-intensive industries shall be determined in a manner similar to that used in determining the average fuel costs in the utility company's monthly fuel adjustment filings with the commission, but shall be the actual fuel costs of its oil and gas-fired generation for delivery within the state and any purchases of economy energy for its customers within the state. The fuel cost for off-peak service shall be the actual fuel costs of its oil and gas-fired generation for delivery within the state and any purchases of economy energy for its customers within the state during such off-peak hours.
C. Electric service may be provided at such rate for an initial term of no more than five years and may be renewed upon certification by the Board of Commerce and Industry and with the consent of the governor for an additional five years.
D. An industry may qualify as a "depressed energy-intensive industry" if the Board of Commerce and Industry, after hearing conducted pursuant to the Administrative Procedure Act, certifies that the industry applying therefor meets each of the following requirements:
(1) The applicant industry verifies that the expense of electricity and natural gas utilized for facility power requirements and not for feedstock purposes to its Louisiana facility exceeds thirty-three percent of the total cost of the product or products manufactured at such facility.
(2) The applicant industry verifies that the amount of electricity or natural gas consumed for facility power requirements and not for feedstock purposes at the facility is in excess of one billion BTUs in a peak hour per month and that the ratio of hourly peak demand is not in excess of three million BTUs per employee. For the purposes of this Paragraph, one kilowatt hour of electrical energy is deemed equivalent to ten thousand BTUs and one thousand cubic feet of gas is deemed equivalent to one million BTUs.
(3) The applicant industry verifies that its Louisiana facility has been substantially curtailed for a period of at least twelve months prior to June 1, 1984 resulting in the loss of direct employment at that single facility in excess of one thousand regular employees and that qualifying as a depressed energy-intensive industry for purchase of energy available to such qualifying industry would substantially aid in the reopening of or the preclusion of closure of such facility.
(4) The accounting procedure for allocation of costs to the Louisiana facility of the applicant is certified by the Board of Commerce and Industry, and the applicant agrees that based upon that method of allocation, twenty-five percent of any net profit after taxation realized by that Louisiana facility on an annual fiscal basis subsequent to the receipt of energy available to certified depressed energy-intensive industries will be utilized for and dedicated to capital improvements to the Louisiana facility in question.
E. The Department of Economic Development shall review the application of any industry wishing to qualify as a depressed energy-intensive industry to determine whether the requirements set forth above have been satisfied and shall make recommendations with respect thereto to the Board of Commerce and Industry. If the Board of Commerce and Industry concurs in the recommendation of the Department of Economic Development and has concluded pursuant to hearing that applicant has made the appropriate verifications required by Subsection D hereinabove, the board shall notify the mineral board and the Public Service Commission. Upon certification to the Public Service Commission, the depressed energy-intensive industry shall qualify for provision of electric service pursuant to the rate and conditions set forth above.
F. The cost of fuel or purchased power for sale to depressed energy-intensive industry not otherwise reimbursed or recouped pursuant to implementation of the rate tariff set forth above may not be recovered from any other class of customer or from any other rate payer of the electric public utility in question pursuant to its monthly fuel adjustment clause filings with the Public Service Commission.
Acts 1984, No. 202, §1.
