Montana Code 69-3-1407. Optional performance-based ratemaking for natural gas utilities — commission rulemaking
69-3-1407. Optional performance-based ratemaking for natural gas utilities — commission rulemaking. (1) The commission may, upon application and after giving notice and conducting a hearing as provided in 69-3-303, authorize any natural gas utility to implement an optional form of rate regulation using a performance-based ratemaking methodology.
Terms Used In Montana Code 69-3-1407
- commission: means the public service commission provided for in 2-15-2602. See Montana Code 69-1-101
- Customer: means a natural gas customer or consumer of natural gas supply or natural gas transmission facilities, storage facilities, or distribution facilities. See Montana Code 69-3-1402
- Natural gas utility: means a utility regulated by the commission on May 2, 1997, that provides natural gas services to the public. See Montana Code 69-3-1402
- Performance-based ratemaking: means those forms of regulation that include but are not limited to the use of revenue indexing, price indexing, ranges of authorized return, gas cost indexing, and innovative use of utility-related assets and activities, such as system sales of excess natural gas supplies, release of upstream pipeline capacity, and performance of billing services for other natural gas suppliers. See Montana Code 69-3-1402
(2)The commission may approve a performance-based ratemaking methodology if it finds that the methodology:
(a)preserves adequate service to all classes of customers, including transportation-only customers;
(b)does not unreasonably prejudice or disadvantage any class of natural gas utility users;
(c)provides incentives for improved performance by the natural gas utility in the natural gas utility’s public duties;
(d)results in rates that are not excessive; and
(e)is in the public interest.
(3)The commission may, after giving notice and conducting a hearing as provided in 69-3-303, modify or discontinue a natural gas utility’s performance-based ratemaking previously authorized under this section if the commission finds that:
(a)natural gas service to one or more classes of customers has deteriorated or will deteriorate;
(b)any class of natural gas utility customer is being unreasonably prejudiced or disadvantaged;
(c)the performance-based ratemaking is not providing or will not provide reasonable incentives for improved performance by a natural gas utility in the performance of its public duties;
(d)rates are excessive compared to a natural gas utility’s cost of service;
(e)terms ordered by the commission in connection with the approval of a natural gas utility’s implementation of performance-based ratemaking have been violated; and
(f)the performance-based form of regulation is not in the public interest.
(4)The commission shall promulgate rules for monitoring a natural gas utility that has implemented performance-based ratemaking to ensure that the natural gas utility is in compliance with the requirements of this section.