An Act To Save Money for Maine Energy Consumers through Enhanced Energy Efficiency No. 1836 April 5, 2007
Maine Legislature, Session 123, LD 1836
Committee: Utilities and Energy
Sponsors: BARTLETT, BLISS
Amends: 35-A MRSA §3153-A, 35-A MRSA §3195, 35-A MRSA §3210-D, 35-A MRSA §3211-A

Legislative Document 
S.P.654 
An Act To Save Money for Maine Energy Consumers through 
Enhanced Energy Efficiency 
No. 1836 
April 5, 2007 
Reference to the Committee on Utilities and Energy suggested and ordered printed. 
Presented by Senator BARTLETT of Cumberland. 
Cosponsored by Representative BLISS of South Portland. 
Printed on recycled paper 
JOY J. O'BRIEN 
SecretarY of the Senate 
Be it enacted by the People of the State of Maine as follows: 
Sec. 1. 35-A MRSA §3153-A, sub-§4 is enacted to read: 
4. In any general rate design case, pending on or initiated after January 1, 2007, the 
commission shall adopt provisions for severing the link between utility sales and earnings 
consistent with the provisions of section 3195, subsection 1. 
Sec. 2. 35-A MRSA §3195, sub-§l, as amended by PL 1999, c. 398, Pt. A, §71 
and as affected by §§ 1 04 and 105, is further amended to read: 
1. Rate-adjustment mechanisms. This Title may not be construed to prohibit the 
commission from or to restrict the commission in establishing or authorizing any 
reasonable rate-adjustment mechanisms to promote efficiency in transmission and 
distribution utility operations and least-cost planning. Rate adjustmeRt mechaRisms may 
iRclude, but are Rot limited to: In order to ensure that the incentives offered to electric 
transmission and distribution utilities are aligned with customer interests in reducing 
energy costs through increased energy efficiency and demand reduction resources, the 
commission shall adopt provisions for severing the link between utility sales and 
earnings. On or after the issuance of a final decision in a proceeding on amendments to 
rate schedules for any electric transmission and distribution utility, but not later than 
January 1, 2009, any electricity or natural gas distribution rate energy adjustment clause 
approved by the commission for an electric or natural gas company must include a 
provision designed to allow the electric or natural gas company to charge or reimburse 
customers for any under-recovery or over-recovery of overhead and fixed costs due solely 
to the deviation of actual retail sales of electricity or natural gas from projected retail 
sales of electricity or natural gas. The provision may be based on changes to either total 
retail sales or per customer retail sales. Additional rate adjustments may also include: 
A. 
DecoupliRg of utility profits from utili!)' sales through reyeAUe recoAciliatioA; 
B. RecoRciliatioR of actual re"t'eAues or costs with projected re¥eAues or costs, either 
OR a total or per customer basis; 
C. AdjustmeAt of re¥eRues based OA recoAciled, iAdeKed or forecasted costs; aAd 
D. Positive or negative financial incentives for efficient operations. 
Sec. 3. 35-A MRSA §3210-D, first~, as enacted by PL 2005, c. 677, Pt. C, § 1, is 
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amended to read: 
The commission shall adopt by rule a long-term plan for electric resource adequacy 
for this State to ensure grid reliability and the provision or availability of electricity to 
consumers at the lowest cost. To help reduce energy costs of consumers in this State by 
the maximum amount possible, the commission shall hold an uncontested docket in 
which interested parties may submit comments and shall establish by separate order 
efficiency investment strategies, consistent with the long-term plan and not otherwise 
directly allocable, by which to realize through distribution rates all available energy 
efficiency and demand reduction resources that are cost-effective, reliable and feasible in 
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this State. 
Investments directed pursuant to this section may be deposited in the 
conservation program fund established under section 321 I-A, subsection 5. 
Sec. 4. 35-A MRSA §3211-A, sub-§2, ~A, as amended by PL 2005, c. 569, §I, 
is further amended to read: 
A. The commission shall consider, without limitation, conservation programs that: 
(I) Increase consumer awareness of cost-effective options for conserving energy; 
(2) Create more favorable market conditions for the increased use of efficient 
products and services; 
(3) 
Promote sustainable economic development and reduced environmental 
damage; aHd 
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(4) Reduce the price of electricity over time for all consumers by achieving 
reductions in demand for electricity during peak use periods~; and 
(5) Reduce total costs paid by electricity consumers in this State by increasing 
the efficiency with which electricity is consumed in this State. 
Sec. 5. 35-A MRSA §3211-A, sub-§2, ~, as enacted by PL 200 I, c. 624, §4, is 
amended to read: 
B. 
The commission shall: 
(I) Target at least 20% of ayailable funds to programs for low ineome residential 
eonSHmers, as defined by the eommission by rule; 
(2) 
Target at least 20% of ayailable funds to programs for small bHsifless 
I 
eonSHmers, as defined by the eommission by rule; and 
(3) 
To the greatest extent practicable, apportion remaifling available funds 
assessed under this section among customer groups and geographic areas in a 
manner that allows each customer group to receive funding approximately 
proportionate to its contribution to total assessments under this section and allows 
all other customers to have a reasonable opportunity to participate in one or more 
conservation programs. 
Sec. 6. 35-A MRSA §3211-A, sub-§2, ~C, as enacted by PL 2001, c. 624, §4, is 
repealed and the following enacted in its place: 
C. The Energy Efficiency Stakeholder Board shall advise and assist the commission 
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and other agencies, utilities or other publicly directed energy efficiency program 
administrators in the design, implementation and periodic review of a comprehensive 
energy savings plan to implement cost-effective energy conservation programs and 
market transformation initiatives. The plan must: 
(I) Provide the overall energy strategy for all energy efficiency and conservation 
programs in this State funded by or through, but not limited to: 
(al 
The minimum conservation program assessment in section 321 I -A, 
subsection 4; 
eb) Any proceeds from allowances of a regional greenhouse gas initiative, or 
a similar regulatory system, that generates proceeds from the sale of 
emissions allowances; 
(c) Payments from the regional forward capacity markets; 
(d) Natural gas, home heating oil or other home heating fuel assessments, 
taxes, fees or contributions; 
ee) Contracts for energy efficiency used to satisfy standard offer service; 
(f) Long-term contracting of demand-side capacity resources; 
eg) State and federally funded weatherization programs; and 
(h) Any rate-based investments directed by the commission to realize cost-
effective energy efficiency and demand reduction; 
(2) Be updated at least once every 3 years. Each program contained in the 
comprehensive energy savings plan must be voted on by the Energy Efficiency 
Stakeholder Board prior to submission to the commission for approval. Approval 
of the plan and other decisions by the board requires an affirmative vote of at 
least 60% of the members of the board. The Energy Efficiency Stakeholder 
Board shall, as part of its review, examine opportunities to offer joint programs 
providing similar efficiency measures that save more than one fuel resource or 
otherwise to coordinate programs targeted at saving more than one fuel resource. 
Any costs for joint programs must be allocated equitably among the energy 
efficiency and conservation programs; and 
(3) Be approved by the commission. 
Sec. 7. 35-A MRS A §3211-A, sub-§2,~, as enacted by PL 2001, c. 624, §4, is 
amended to read: 
F. 
The Energy Efficiency Stakeholder Board and the commission shall monitor and 
evaluate the delivery of conservation programs by service providers and assess the 
cost-effectiveness of programs in meeting the objectives and overall strategy 
established by the commission comprehensive energy savings plan under section 
3211-A, subsection 2, paragraph C. 
Strategies and programs included in the comprehensive energy savings plan must be 
screened through cost-effectiveness testing that compares the value and payback 
period of program benefits to program costs to ensure that programs are designed to 
obtain energy savings and system benefits the value of which is greater than the costs 
of the programs. Cost-effectiveness for each strategy or program must be reviewed 
annually, or otherwise as is practicable, and if a strategy or program fails the cost-
effectiveness test as part of the review process, it must either be modified to pass the 
test or be terminated. 
Sec. 8. 35-A MRS A §3211-A, sub-§2,~, as enacted by PL 2001, c. 624, §4, is 
amended to read: 
H. 
The commission shall secure sufficient technical and administrative expertise to 
carry out its responsibilities pursuant to this section by: 
(l) Contracting with appropriate entities with relevant expertise and experience; 
(2) EstablishiRg ORe or more advisory groups composed of perSORS with rele'.,raRt 
eKpertise aRd eKperieRce; or No later than October 1, 2007, establishing, 
appointing and convening the Energy Efficiency Stakeholder Board, which must 
include one representative of each of the following: 
Ca) A statewide manufacturing association; 
(b) A statewide business association; 
(c) A chamber of commerce; 
(d) Residential customers; 
(e) Low-income customers; 
(f) An environmental advocacy organization; 
(g) An environmental organization knowledgeable in energy efficiency and 
energy procurement programs; 
(h) The Office of the Public Advocate; 
(i) The Department of Environmental Protection; and 
(j) The Attorney General. 
Each board member must have some relevant background or experience in 
energy technologies, markets or policy. The commission and each of the electric 
and natural gas distribution companies operating in this State are entitled to have 
a nonvoting, ex officio member on the board. Representatives serve for a term of 
years and may be reappointed. 
Expenditures by the Energy Efficiency 
Stakeholder Board for the retention of expert consultants and reasonable 
administrative costs must be recovered in distribution rates and from other 
sources. Such consultants may not be employed by or have any contractual 
relationship with an electric or natural gas distribution company. Such costs may 
not exceed 5% of the total costs of energy efficiency and conservation plans. 
Costs of independent expert services must be provided for in the comprehensive 
energy savings plan; or 
(3) Any By any other reasonable means developed by the commission. 
Sec. 9. 35-A MRS A §3211-A, sub-§4, as amended by PL 2005, c. 459, § 1, is 
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further amended to read: 
4. Funding level. The commission shall assess transmission and distribution utilities 
to collect funds for a minimum base level of conservation programs and administrative 
costs in accordance with this subsection. 
The amount of all assessments by the 
commission under this subsection plus expenditures of a transmission and distribution 
utility associated with prior conservation efforts must result in total conservation 
expenditures by each transmission and distribution utility that: 
' 
A. 
Are based on the relevant characteristics of the transmission and distribution 
utility's service territory, including the needs of customers; 
B. Do Rot exceed Are fixed at a rate of .145 cent per kilowatt-hour; and 
C. 
Except as provided iR sl:lbsectioR 7 A, are RO less thaR 0.5% of the total 
traRsmissioR aRd distribl:ltioR re'leRl:IeS of the traRsmissioR aRd distribl:ltioR l:Itilit)'; 
aOO 
D. 
Are proportionally equivalent on a per-kilowatt-hour basis to the total 
conservation expenditures of other transmission and distribution utilities, unless the 
commission finds that a different amount is justified. 
SUMMARY 
This bill directs the Public Utilities Commission to establish the Energy Efficiency 
Stakeholder Board to advise and assist the commission, other agencies, utilities and 
publicly directed energy efficiency program administrators in the design, implementation 
and review of a comprehensive energy savings plan to implement cost-effective energy 
conservation programs and market transformation initiatives. The bill sets an assessment 
rate on transmission and distribution utilities to fund conservation programs and specifies 
the method of apportionment of funds collected for conservation programs among groups 
of customers. 
The bill amends the laws governing rate-adjustment mechanisms for 
transmission and distribution utilities as they relate to utility sales and earnings.