I
104TH CONGRESS
2D SESSION
H. R. 2929
To amend title I of the Public Utility Regulatory Policies Act of 1978
to deregulate the electric power industry.
IN THE HOUSE OF REPRESENTATIVES
FEBRUARY 1, 1996
Mr. MARKEY introduced the following bill; which was referred to the Commit-
tee on Commerce, and in addition to the Committee on the Judiciary, for
a period to be subsequently determined by the Speaker, in each case for
consideration of such provisions as fall within the jurisdiction of the com-
mittee concerned
A BILL
To amend title I of the Public Utility Regulatory Policies
Act of 1978 to deregulate the electric power industry.
Be it enacted by the Senate and House of Representa-
tives of the United States of America in Congress assembled,
SECTION 1. SHORT TITLE AND TABLE OF CONTENTS.
(a) SHORT TITLE.—This Act may be cited as the
‘‘Electric Power Competition Act of 1996’’.
(b) TABLE OF CONTENTS.—
Sec. 1. Short title and table of contents.
Sec. 2. Findings.
TITLE I—SUSPENSION OF PUBLIC UTILITY REGULATORY
POLICIES ACT PROVISIONS
Sec. 101. Purchases from qualifying facilities.
TITLE II—STANDARDS OF COMPETITION FOR ELECTRIC
UTILITIES
Sec. 201. Standards of competition.
TITLE III—ANTITRUST LAWS
Sec. 301. State action doctrine.
SEC. 2. FINDINGS.
The Congress finds that equitable rates for electric
consumers and increased efficiency in the use of tech-
nology and resources for the generation of electric power
require—
(1) reliance on competition and market forces
rather than regulation of monopolies to generate the
most efficient and reliable electricity for ratepayers;
(2) access to transmission and distribution fa-
cilities for all suppliers and marketers of electricity
with pricing and terms and conditions on a com-
parable basis with those who own or control such fa-
cilities;
(3) a program to promote fuel diversity and
conservation and environmental protection through
the encouragement of renewable technologies and
other environmentally benign generation resources;
(4) the ability of electric utilities to recover le-
gitimate and verifiable stranded costs;
(5) the preservation of the benefits and exemp-
tions necessary for a competitive market, including
mandatory power purchase provisions which are pro-
vided to qualifying small power production facilities
and qualifying cogeneration facilities under section
210 of the Public Utility Regulatory Policies Act of
1978 until and unless standards of competition are
adopted by the Federal Energy Regulatory Commis-
sion and implemented by the State regulatory au-
thorities removing structural or other barriers to
competition in electricity markets; and
(6) reform of Federal and State electric utility
regulatory laws and regulations, including eliminat-
ing certain exemptions from certain antitrust laws,
which create unnecessary obstacles to competition
and to prevention of anticompetitive behavior of en-
tities with market power.
TITLE I—SUSPENSION OF PUB-
LIC 
UTILITY 
REGULATORY
POLICIES ACT PROVISIONS
SEC. 101. PURCHASES FROM QUALIFYING FACILITIES.
Title II of the Public Utility Regulatory Policies Act
of 1978 is amended by adding the following new sections
at the end thereof:
‘‘SEC. 214. UTILITIES WITH CERTIFICATION OF COMPETI-
TION.
‘‘(a) CERTAIN REQUIREMENTS OF SECTION 210 SUS-
PENDED.—If an electric utility has received a Certification
of Competition from a State regulatory authority in ac-
cordance with subtitle F of title I—
‘‘(1) the provisions of section 210 requiring
electric utilities to offer to purchase electric energy
from qualifying cogeneration facilities and qualifying
small power production facilities shall be suspended;
and
‘‘(2) for power purchase arrangements entered
into during the period of any such suspension, for
the duration of such power purchase arrangements
the rates for such purchase shall not be dependent
on the incremental cost to the electric utility of al-
ternative energy in section 210(b).
‘‘(b) PROTECTION OF EXISTING CONTRACTUAL COM-
MITMENTS.—Nothing in this Act, directly or indirectly,
authorizes the Commission, a State regulatory authority,
or any electric utility to reopen, alter, curtail, force the
renegotiation of, or interfere with the enforcement of any
power purchase arrangements between a qualifying cogen-
eration facility or qualifying small power production facili-
ties and an electric utility purchaser.
‘‘(C) the electric utility does not gain any ad-
vantage over other competitors by virtue of its status
as a regulated buyer and seller of electricity in its
service territory.
‘‘(2) Certification under paragraph (1) of this sub-
section shall be withdrawn if the State regulatory author-
ity finds that—
‘‘(A) an electric utility affiliate is competing un-
fairly by using assets, goods, or services obtained
from the electric utility at a price below the market
value; or
‘‘(B) the electric utility or its affiliate has dis-
criminatory access to any asset, service, or informa-
tion which would be helpful to a competitor where
the access is attributable to the electric utility’s sta-
tus as a regulated integrated monopoly or the asset
or information is an essential facility that is not eco-
nomically duplicable by a competitor.
‘‘(b) DIVESTITURE STANDARD.—A State regulated
electric utility that is an integrated electric utility that
owns or controls a monopoly distribution franchise, mo-
nopoly transmission facilities, or both, meets the divesti-
ture standard of competition if the State regulatory au-
thority which has ratemaking authority over such utility
determines, in accordance with criteria established by the
Commission under section 151(b), and after notice and
opportunity for hearing, that the utility has—
‘‘(1) divested itself of all existing generation fa-
cilities and is prohibited under State law from di-
rectly or indirectly acquiring ownership or control of
any generation facilities for so long as it owns or
controls a monopoly distribution franchise or trans-
mission facilities, and
‘‘(2) in the case of a utility that owns or con-
trols transmission facilities, adopted open access
transmission tariffs that have been approved as just,
reasonable, and not unduly preferential.
‘‘SEC. 153. MINIMUM CERTIFICATION REQUIREMENTS.
‘‘A State regulatory authority may not issue a certifi-
cation of competition under this subtitle to any electric
utility unless the authority has made each of the following
determinations:
‘‘(1) A determination that all suppliers of en-
ergy services to the utility or to electricity consumers
in the service territory of the utility have both the
incentive and opportunity to provide energy-effi-
ciency and renewable energy resources that are less
costly on a life-cycle basis than displaced generation.
‘‘(2) 
A 
determination 
that 
nonbypassable
charges on use of, or access to, the local distribution
services or facilities of the utility are in effect and
adequate to ensure sustained and equitable alloca-
tion of costs associated with low-income services and
other investments, including those in fuel diversity
and energy efficiency, that deliver system wide bene-
fits in the form of equity among, or reduced life-
cycle costs of service to, electricity consumers in the
service territory of the utility: Provided, That the
fuel diversity objective may also be met by minimum
portfolio standards that ensure maintenance or im-
provement of current levels of reliance on renewable
energy resources.
‘‘(3) A determination that any systems of retail
competition among electric-service suppliers are
structured to protect customers from price discrimi-
nation or undue price increases and to ensure that
no customer class can avoid its equitable share of
the electric utility’s legitimate and verifiable strand-
ed costs.
‘‘(4) A determination that under applicable
State laws and regulations, any recovery of sunk
costs associated with existing generation assets, is
not contingent on continued operation of the genera-
tion assets for which recovery is approved.’’.
TITLE III—ANTITRUST LAWS
SEC. 301. STATE ACTION DOCTRINE.
(a) GENERAL RULE.—In order to ensure that rem-
edies for anticompetitive abuses are available to entities
competing in the electric generation market, utilities exer-
cising monopoly functions under State regualtion may not
use the ‘‘State action’’ doctrine of antitrust jurisprudence
as a defense against charges of anticompetitive behavior
in unregulated generation markets.
(b) TERMS.—For purposes of this section—
(1) The terms used in this title shall have the
same meaning as when used in title I of the Public
Utility Regulatory Policies Act of 1978.
(2) The term ‘‘antitrust laws’’ includes the
Sherman Antitrust Act (15 U.S.C. 1 et seq.) and
amendments thereto, the Clayton Act (15 U.S.C. 12
et seq.) and amendments thereto, regulations pro-
mulgated under such laws, and Federal court deci-
sions interpreting such laws.
(3) The term ‘‘State action doctrine’’ means the
judicial rule first articulated by the United States
Supreme Court in Parker v. Brown, 317 U.S. 341,
352 (1943) by which any act would be exempt from
compliance with Federal antitrust laws because
taken pursuant to direction or authorization by the
laws, regulations, or governmental activity of any
State.
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