senate Bill S4502A

Enacts the "utility preparedness act of 2014"

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Bill Status


  • Introduced
  • In Committee
  • On Floor Calendar
    • Passed Senate
    • Passed Assembly
  • Delivered to Governor
  • Signed/Vetoed by Governor
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actions

  • 05 / Apr / 2013
    • REFERRED TO ENERGY AND TELECOMMUNICATIONS
  • 08 / Jan / 2014
    • REFERRED TO ENERGY AND TELECOMMUNICATIONS
  • 24 / Jan / 2014
    • AMEND AND RECOMMIT TO ENERGY AND TELECOMMUNICATIONS
  • 24 / Jan / 2014
    • PRINT NUMBER 4502A

Summary

Enacts the "utility preparedness act of 2014"; requires the commission to issue an order establishing and requiring compliance with power restoration performance standards for certain electric companies to reduce the duration of outages and disruptions and to facilitate restoration of power after outages and disruptions.

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Bill Details

See Assembly Version of this Bill:
A6502A
Versions:
S4502
S4502A
Legislative Cycle:
2013-2014
Current Committee:
Senate Energy And Telecommunications
Law Section:
Public Service Law
Laws Affected:
Add §66-n, Pub Serv L

Sponsor Memo

BILL NUMBER:S4502A

TITLE OF BILL: An act to amend the public service law, in relation to
utility preparedness for outages and disruptions of service

PURPOSE:

To create a utility preparedness program which will impose new standards
for preparedness and power restoration to address forthcoming major
utility outages, like that experienced during Hurricane Sandy. Under the
bill, the public service commission will adopt and enforce, and the
utilities will be required to comply with, performance incentives and
standards for each transmission and distribution company during power
outages in which more than ten percent of a transmission and distrib-
ution company's customers are without power for more than forty eight-
consecutive hours.

SUMMARY OF PROVISIONS:

Section 1 provides that the act shall be entitled "utility preparedness
act of 2014."

Section 2 provides that the public service law is amended by adding a
new section, 66-n, entitled "utility preparedness act of 2014."

Section 1(a) of § 66-n defines "electric transmission and distribution
company" to include investor-owned utilities having annual revenues in
excess of $200 million that transmit electricity within New York State.
Section 1(b) defines "vegetation management."

Section 2 (a) of § 66-n requires that no later than one year following
the effective date of this section, the PSC shall create power restora-
tion performance benchmarks and standards for utility companies to
reduce the duration of power outages, and to facilitate restoration of
power after outages or disruptions.

Section 2 of § 66-n provides that these benchmarks and standards are
established for power outages in which more than ten percent of a utili-
ty's customers are without power for more than forty-eight consecutive
hours.

Sections 2 (b) (i) through (xiv) of § 66-n establish that standards and
benchmarks shall include provisions for minimum staffing and equipment
levels for each company; timetables for restoration of power in outages
affecting more than ten percent, thirty percent, fifty percent and
seventy percent of such company's customers; creation and-requirements
of a communication plan between each company and its customers, includ-
ing communication during time periods that are not considered normal
business hours; safety of companies' employees, mutual aid crews and
private contractors; notification of the commission and the public when
a company has requested aid for storm restoration assistance from other
utilities, including the number of workers and/or equipment the company

has requested; communication and coordination between each company and
the relevant state or local emergency operations center concerning emer-
gency preparation, road clearing, and restoration activities; tree trim-
ming, cutting and removal by each utility company to reduce power
outages caused by trees and limbs; coordination and communication
between the utility and the public; reimbursement for actual losses of
spoiled food due to refrigeration caused by power outages lasting
forty-eight or more hours when greater than ten percent of residential
customers have lost power up to $200 per itemized list and above $200
upon submission of itemized list and proof of loss, up to a maximum of
$450 for any one customer, and actual losses of perishable prescription
medicine spoiled as a result of such outages; timely notice of outage by
utilities to state and municipal agencies; operation of an emergency
call center by each company; and any other standards the commission
deems necessary.

Section 2(c) (i) through (vi) of § 66-n provide that the PSC, in devel-
oping its power restoration performance benchmarks and standards
required under the bill, shall review the current practices of electric
transmission and distribution companies; the adequacy-of each company's
infrastructure, facilities and equipment; vegetation management policies
of each company; impact of burying power lines underground; impact of
expanding area adjacent to distribution lines for tree trimming; and any
other policy or practice the PSC deems necessary. Section 2 (d) of
66-n authorizes the PSC to permit companies to recover the reasonable
cost incurred by such company to maintain or improve the reliability of
such company's infrastructure necessary to meet these standards. Section
2(e) of § 66-n authorizes the PSC to establish additional standards when
it is deemed necessary. Section 2 (f) provides that not later than one
year after the commission issues an order pursuant to subdivision 2(a)
and each year thereafter, each company shall provide an emergency
response report to the PSC. The report shall include information and
analysis concerning the utility's conduct during the preceding year.

Section 3 of § 66-n authorizes the PSC to review the performance of each
company after any emergency in which more than ten percent of any such
company's customers were without power for more than forty-eight consec-
utive hours

Section 3(b) of § 66-n provides that at the commissioner's discretion
upon a finding, after a hearing or opportunity to be heard, that any
company fails to comply with any standard required by this section or
any order of the commission, the PSC is authorized to order civil penal-
ties to be imposed upon such company, not to exceed a total of two and
one half percent of such company gross annual revenue and with consider-
ation given to whether such company recovered the costs it incurred.
Satisfaction of any such penalty imposed shall be made in the form of a
credit to ratepayers within 120 days of such order and shall not be
included as an operating expense.

Section 3 provides for the effective date of the bill.

JUSTIFICATION:

Recent storms, such as Hurricane Sandy, have revealed substantial gaps
in the oversight of electric transmission and distribution companies.
This super storm underscored that the system would greatly benefit from
economic incentives to encourage faster remediation efforts, improved
communication with customers and municipal governments, better planning
and preparedness, and improved transparency in the operation of our
utilities. This bill, based in part on Connecticut's forward-thinking
legislation enacted in the wake of Hurricane Irene and the October Nor'
easter, requires the utilities, and the PSC to develop, authorize and
operationalize stronger storm preparedness plans. In addition, it will
provide strong economic incentives for companies to move quickly and
professionally in all aspects of their remediation and recovery oper-
ations.

LEGISLATIVE HISTORY:

04/05/13- REFERRED TO ENERGY AND TELECOMMUNICATIONS

FISCAL IMPLICATIONS:

To be determined.

LOCAL FISCAL IMPLICATIONS:

To be determined.

EFFECTIVE DATE:

Immediately.

view bill text
                    S T A T E   O F   N E W   Y O R K
________________________________________________________________________

                                 4502--A

                       2013-2014 Regular Sessions

                            I N  S E N A T E

                              April 5, 2013
                               ___________

Introduced  by  Sen. LATIMER -- read twice and ordered printed, and when
  printed to be committed to the Committee on  Energy  and  Telecommuni-
  cations  --  recommitted  to  the Committee on Energy and Telecommuni-
  cations in  accordance  with  Senate  Rule  6,  sec.  8  --  committee
  discharged, bill amended, ordered reprinted as amended and recommitted
  to said committee

AN ACT to amend the public service law, in relation to utility prepared-
  ness for outages and disruptions of service

  THE  PEOPLE OF THE STATE OF NEW YORK, REPRESENTED IN SENATE AND ASSEM-
BLY, DO ENACT AS FOLLOWS:

  Section 1. This act shall be known and may be cited  as  the  "utility
preparedness act of 2014".
  S 2. The public service law is amended by adding a new section 66-n to
read as follows:
  S  66-N.  UTILITY PREPAREDNESS FOR OUTAGES AND DISRUPTIONS OF SERVICE.
1.  DEFINITIONS. AS USED IN THIS SECTION:
  (A) "ELECTRIC TRANSMISSION AND DISTRIBUTION COMPANY" OR  "TRANSMISSION
AND  DISTRIBUTION  COMPANY"  OR  "COMPANY" SHALL MEAN: AN INVESTOR-OWNED
UTILITY HAVING ANNUAL REVENUES IN EXCESS OF TWO HUNDRED MILLION  DOLLARS
THAT TRANSMITS AND DISTRIBUTES ELECTRICITY WITHIN THIS STATE.
  (B)   "VEGETATION  MANAGEMENT"  SHALL  MEAN:  PROGRAMS  AND  PRACTICES
DESIGNED TO PREVENT ELECTRIC SYSTEM DISRUPTIONS OR POWER OUTAGES  CAUSED
BY  THE  PHYSICAL  INTERFERENCE  OR COLLAPSE OF TREES, TREE BRANCHES AND
OTHER VEGETATION ON ELECTRIC TRANSMISSION AND DISTRIBUTION LINES.
  2. TRANSMISSION AND DISTRIBUTION COMPANY  PERFORMANCE  BENCHMARKS  AND
STANDARDS.    (A) NO LATER THAN ONE YEAR FOLLOWING THE EFFECTIVE DATE OF
THIS SECTION, THE COMMISSION SHALL ESTABLISH, AND EACH TRANSMISSION  AND
DISTRIBUTION  COMPANY  IS  REQUIRED  TO  COMPLY  WITH, POWER RESTORATION
PERFORMANCE BENCHMARKS AND STANDARDS TO REDUCE THE DURATION  OF  OUTAGES
AND  DISRUPTIONS AND TO FACILITATE RESTORATION OF POWER AFTER OUTAGES OR
DISRUPTIONS. PRIOR TO ESTABLISHING SUCH BENCHMARKS  AND  STANDARDS,  THE

 EXPLANATION--Matter in ITALICS (underscored) is new; matter in brackets
                      [ ] is old law to be omitted.
                                                           LBD09413-04-4

S. 4502--A                          2

COMMISSION  MAY  REQUIRE  COMPANIES  TO  SUBMIT  DOCUMENTS AND ANY OTHER
INFORMATION IN THEIR POSSESSION IN ORDER TO  ASSIST  THE  COMMISSION  IN
ESTABLISHING SUCH BENCHMARKS AND STANDARDS.
  (B)  THE  BENCHMARKS AND STANDARDS ESTABLISHED BY THE COMMISSION SHALL
BE DESIGNED FOR POWER OUTAGES IN WHICH MORE THAN TEN PERCENT OF A TRANS-
MISSION AND DISTRIBUTION COMPANY'S CUSTOMERS ARE WITHOUT POWER FOR  MORE
THAN  FORTY-EIGHT CONSECUTIVE HOURS AND SHALL INCLUDE BUT NOT BE LIMITED
TO, STANDARDS FOR:
  (I) MINIMUM STAFFING AND EQUIPMENT LEVELS FOR EACH COMPANY,  BASED  ON
THE  NUMBER  OF  CUSTOMERS  SERVED BY SUCH COMPANY AND THE NATURE OF THE
INFRASTRUCTURE DEPLOYED TO SERVE SUCH COMPANY'S CUSTOMERS IN  THE  EVENT
OF AN EMERGING OR WIDE-SPREAD OUTAGE OR DISRUPTION;
  (II)  A  TIMETABLE  FOR RESTORATION OF POWER IN OUTAGES AFFECTING MORE
THAN TEN PERCENT, THIRTY PERCENT, FIFTY PERCENT AND SEVENTY  PERCENT  OF
SUCH COMPANY'S CUSTOMERS;
  (III)  A  TIMETABLE  FOR  RESTORATION OF POWER WHEN OUTAGES ARE DUE TO
BLACKOUTS OF THE ENTIRE GRID;
  (IV) CREATION OF A COMMUNICATION PLAN BETWEEN  EACH  COMPANY  AND  ITS
CUSTOMERS,  INCLUDING,  BUT  NOT  LIMITED  TO, COMMUNICATION DURING TIME
PERIODS THAT ARE NOT CONSIDERED NORMAL BUSINESS HOURS;
  (V) SAFETY OF COMPANIES' EMPLOYEES, WORK CREWS  AND  PRIVATE  CONTRAC-
TORS;
  (VI)  CREATION  OF  MUTUAL  AID AGREEMENTS WITH OTHER UTILITIES IN THE
REGION AND, AS NEEDED, IN THE UNITED STATES AND CANADA, FOR MUTUAL STORM
RESTORATION ASSISTANCE, WHICH SUCH AGREEMENTS SHALL BE  FILED  WITH  THE
COMMISSION;
  (VII) NOTIFICATION OF THE COMMISSION AND THE PUBLIC WHEN A COMPANY HAS
REQUESTED  AID  FOR  STORM  RESTORATION  ASSISTANCE FROM OTHER UTILITIES
INCLUDING THE NUMBER OF WORKERS AND/OR ADDITIONAL EQUIPMENT THE  COMPANY
HAS REQUESTED;
  (VIII)  COMMUNICATION  AND  COORDINATION  BETWEEN EACH COMPANY AND THE
RELEVANT STATE, MUNICIPAL AND/OR EMERGENCY OPERATIONS  CENTER  OFFICIALS
CONCERNING EMERGENCY PREPARATION, ROAD CLEARING AND THE ESTABLISHMENT OF
RESTORATION PRIORITIES;
  (IX)  TREE  TRIMMING,  CUTTING  AND  REMOVAL  BY EACH TRANSMISSION AND
DISTRIBUTION COMPANY TO REDUCE POWER OUTAGES CAUSED BY TREES AND LIMBS;
  (X) COMMUNICATION AND COORDINATION, AFTER CONSULTATION  WITH  THE  NEW
YORK STATE DIVISION OF HOMELAND SECURITY AND EMERGENCY SERVICES, BETWEEN
EACH TRANSMISSION AND DISTRIBUTION COMPANY AND THE PUBLIC INCLUDING, BUT
NOT  LIMITED TO, STANDARDS CONCERNING THE USE OF ANY EMERGENCY NOTIFICA-
TION SYSTEM TO NOTIFY THE PUBLIC OF POWER  RESTORATION  STATUS  AND  ANY
DANGEROUS  CONDITIONS,  INCLUDING  NOTIFICATION  METHODS  SUCH AS MOBILE
TELEPHONE TEXT MESSAGES, ELECTRONIC MAIL AND  ANY  OTHER  ELECTRONIC  OR
NON-ELECTRONIC MEANS THAT THE COMMISSION MAY REQUIRE;
  (XI) REIMBURSEMENT TO RESIDENTIAL CUSTOMERS FOR:
  (A)  ACTUAL LOSSES OF FOOD SPOILED DUE TO LACK OF REFRIGERATION CAUSED
DURING A POWER OUTAGE LASTING FORTY-EIGHT OR MORE CONSECUTIVE HOURS WHEN
GREATER THAN TEN PERCENT OF A COMPANY'S RESIDENTIAL CUSTOMERS HAVE  LOST
POWER,  IN  AN  AMOUNT  UP  TO TWO HUNDRED DOLLARS UPON SUBMISSION OF AN
ITEMIZED LIST AND IN AN AMOUNT OVER TWO HUNDRED DOLLARS UPON  SUBMISSION
OF  AN ITEMIZED LIST AND PROOF OF LOSS, UP TO A MAXIMUM OF FOUR HUNDRED-
FIFTY DOLLARS FOR ANY ONE CUSTOMER FOR  ANY  ONE  INCIDENT,  WHICH  SUCH
AMOUNTS MAY BE PERIODICALLY REVIEWED AND CHANGED BY THE COMMISSION;
  (B)  ACTUAL LOSSES OF PERISHABLE PRESCRIPTION MEDICINE, SPOILED DUE TO
LACK OF REFRIGERATION, UPON SUBMISSION OF AN ITEMIZED LIST AND PROOF  OF

S. 4502--A                          3

LOSS  AND,  IF  REQUESTED BY THE COMPANY, SUBMISSION OF AUTHORIZATION TO
ENABLE THE COMPANY TO VERIFY THE CLAIMED LOSS;
  (XII)  TIMELY NOTIFICATION OF POWER OUTAGES AND RESTORATION EFFORTS BY
EACH COMPANY TO ANY RELEVANT STATE  OR  MUNICIPAL  AGENCY  OR  OFFICIALS
INCLUDING, BUT NOT LIMITED TO, ANY PUBLIC SAFETY AGENCY OR OFFICIALS;
  (XIII) THE OPERATION OF AN EMERGENCY CALL CENTER BY EACH COMPANY; AND
  (XIV) ANY OTHER STANDARDS THE COMMISSION DEEMS NECESSARY.
  (C)  THE  COMMISSION,  IN DEVELOPING ITS POWER RESTORATION PERFORMANCE
BENCHMARKS AND STANDARDS PURSUANT TO PARAGRAPH (A) OF THIS  SUBDIVISION,
SHALL REVIEW:
  (I)  EACH  TRANSMISSION  AND  DISTRIBUTION COMPANY'S CURRENT PRACTICES
CONCERNING POWER RESTORATION  AFTER  AN  EMERGENCY.  SUCH  REVIEW  SHALL
INCLUDE,  BUT NOT BE LIMITED TO, AN ANALYSIS OF EACH SUCH COMPANY'S: (A)
ESTIMATES CONCERNING POTENTIAL DAMAGE AND POWER DISRUPTIONS  MADE  PRIOR
TO  A  POTENTIAL  OUTAGE  AFFECTING MORE THAN TEN PERCENT OF A COMPANY'S
CUSTOMERS FOR A PERIOD OF MORE THAN FORTY-EIGHT CONSECUTIVE  HOURS;  (B)
DAMAGE AND POWER OUTAGE ASSESSMENTS AFTER ANY EMERGENCY; (C) RESTORATION
MANAGEMENT  AFTER  ANY EMERGENCY, INCLUDING ACCESS TO ALTERNATE RESTORA-
TION RESOURCES VIA MUTUAL AID AGREEMENTS WITH OTHER UTILITIES FOR MUTUAL
STORM RESTORATION ASSISTANCE, INCLUDING THOSE ENTERED  INTO  WITH  OTHER
TRANSMISSION  AND  DISTRIBUTION  COMPANIES;  (D) EACH COMPANY'S PLAN FOR
AT-RISK AND VULNERABLE CUSTOMERS INCLUDING, BUT NOT LIMITED TO,  CUSTOM-
ERS IDENTIFIED IN PARAGRAPHS (A) AND (B) OF SUBDIVISION THREE OF SECTION
THIRTY-TWO  OF  THIS CHAPTER; (E) POLICIES CONCERNING COMMUNICATION WITH
STATE AND LOCAL  OFFICIALS  AND  CUSTOMERS,  INCLUDING  NOTIFICATION  OF
CUSTOMER  RESTORATION ESTIMATES AND THE TIMELINESS, ACCURACY AND USEFUL-
NESS OF SUCH ESTIMATES; AND (F) NEED  FOR  MUTUAL  AID  AGREEMENTS  WITH
OTHER  UTILITIES  FOR MUTUAL STORM RESTORATION INCLUDING ASSISTANCE FROM
CREWS SERVING OTHER UTILITIES OR COMPANIES;
  (II) THE ADEQUACY OF  EACH  TRANSMISSION  AND  DISTRIBUTION  COMPANY'S
INFRASTRUCTURE, FACILITIES AND EQUIPMENT, INCLUDING, BUT NOT LIMITED TO,
ELECTRIC  DISTRIBUTION  LINES, ELECTRIC TRANSFORMERS AND CIRCUITS, WHICH
SHALL INCLUDE AN ANALYSIS OF: (A)  WHETHER  SUCH  COMPANY  IS  FOLLOWING
STANDARD  INDUSTRY  PRACTICES  FOR  OPERATION  AND  MAINTENANCE  OF SUCH
INFRASTRUCTURE, FACILITIES AND EQUIPMENT; AND (B) WHETHER  SUCH  COMPANY
HAS  ACCESS  TO  ADEQUATE REPLACEMENT EQUIPMENT FOR SUCH INFRASTRUCTURE,
FACILITIES AND EQUIPMENT DURING THE COURSE OF A POWER  OUTAGE  AFFECTING
MORE THAN TEN PERCENT OF A COMPANY'S CUSTOMERS FOR MORE THAN FORTY-EIGHT
CONSECUTIVE HOURS;
  (III) VEGETATION MANAGEMENT POLICIES OF EACH TRANSMISSION AND DISTRIB-
UTION  COMPANY  INCLUDING:  (A) EXPENDITURES FOR TREE TRIMMING AND OTHER
PRACTICES TO PREVENT INTERFERENCE OF TRANSMISSION AND DISTRIBUTION LINES
BY VEGETATION; (B) INCIDENCE  OF  POWER  OUTAGES  CAUSED  BY  VEGETATION
INCLUDING  FALLING  TREES  AND  TREE BRANCHES CAUSED BY WEATHER OR OTHER
EVENTS; AND (C) THE AMOUNT AND DURATION OF POWER OUTAGES DURING PREVIOUS
MAJOR STORMS CAUSED BY TREES AND LIMBS OUTSIDE THE CURRENT RIGHT OF  WAY
MANAGEMENT WITH CONSIDERATION GIVEN TO THE QUANTITY AND EFFECTIVENESS OF
PRIOR TREE TRIMMING;
  (IV) THE IMPACT, INCLUDING, BUT NOT LIMITED TO, POTENTIAL REDUCTION OF
POWER OUTAGES AND POTENTIAL COST OF BURYING POWER LINES UNDERGROUND WERE
SUCH EFFORT TO BE UNDERTAKEN;
  (V)  THE  IMPACT  OF EXPANDING THE AREA ADJACENT TO DISTRIBUTION LINES
FOR TREE TRIMMING, INCLUDING AN ANALYSIS OF THE BENEFITS AND  THE  COSTS
OF  SUCH  EXPANSION TO RATEPAYERS AND THE LIKELIHOOD THAT SUCH EXPANSION
WOULD DECREASE DAMAGE TO INFRASTRUCTURE, FACILITIES AND  EQUIPMENT  USED

S. 4502--A                          4

TO  DISTRIBUTE  ELECTRICITY AND DECREASE POWER OUTAGE FREQUENCY OR DURA-
TION; AND
  (VI)  ANY  OTHER  POLICY OR PRACTICE THE COMMISSION DEEMS NECESSARY TO
ANALYZE IN ORDER TO CONDUCT THE REVIEW REQUIRED PURSUANT TO  THIS  PARA-
GRAPH.
  (D) THE COMMISSION SHALL PERMIT EACH COMPANY TO RECOVER THE REASONABLE
COSTS INCURRED BY SUCH COMPANY TO MAINTAIN OR IMPROVE THE RELIABILITY OF
SUCH  COMPANY'S  INFRASTRUCTURE  NECESSARY  TO MEET THE STANDARDS ESTAB-
LISHED PURSUANT TO THIS SECTION.
  (E)  THE  COMMISSION  MAY  ALSO  ESTABLISH  STANDARDS  FOR  ACCEPTABLE
PERFORMANCE BY EACH TRANSMISSION AND DISTRIBUTION COMPANY IN AN EMERGEN-
CY, IN ACCORDANCE WITH THIS SECTION, UPON A DETERMINATION BY THE COMMIS-
SION  THAT  THE  CHANGED  CIRCUMSTANCES OF ANY UTILITY NECESSITATES SUCH
ADDITIONAL STANDARDS.
  (F) NO LATER THAN ONE YEAR FOLLOWING THE ESTABLISHMENT OF  THE  BENCH-
MARKS  AND  STANDARDS  PURSUANT TO PARAGRAPH (A) OF THIS SUBDIVISION AND
EACH YEAR THEREAFTER, EACH TRANSMISSION AND DISTRIBUTION  COMPANY  SHALL
PROVIDE  AN  EMERGENCY  RESPONSE  REPORT  TO THE COMMISSION. SUCH REPORT
SHALL INCLUDE INFORMATION AND  AN  ANALYSIS  CONCERNING  SUCH  COMPANY'S
ABILITY  AND PERFORMANCE DURING THE PRECEDING YEAR TO MEET THE EMERGENCY
PREPAREDNESS AND RESPONSE STANDARDS ESTABLISHED BY THE COMMISSION PURSU-
ANT TO THIS SECTION. IN ADDITION TO THE ANNUAL RESPONSE REPORT  REQUIRED
IN  THIS  PARAGRAPH,  THE COMMISSION MAY REQUIRE ANY UTILITY TO SUBMIT A
SUPPLEMENTAL EMERGENCY RESPONSE REPORT AFTER  ANY  STORM,  EMERGENCY  OR
EVENT CAUSING SIGNIFICANT POWER DISRUPTIONS.
  3.  THE  COMMISSION  SHALL REVIEW THE PERFORMANCE OF EACH TRANSMISSION
AND DISTRIBUTION COMPANY AFTER ANY EMERGENCY: (A) IN WHICH MORE THAN TEN
PERCENT OF ANY SUCH COMPANY'S CUSTOMERS WERE WITHOUT POWER FOR MORE THAN
FORTY-EIGHT CONSECUTIVE HOURS; OR (B) AT  THE  COMMISSION'S  DISCRETION.
THE  COMMISSION,  UPON  A  FINDING, AFTER A HEARING OR OPPORTUNITY TO BE
HEARD, THAT ANY SUCH COMPANY FAILED TO COMPLY WITH ANY RESTORATION STAN-
DARD REQUIRED BY THIS SECTION OR ANY ORDER OF THE COMMISSION IN PREPARA-
TION FOR A POWER OUTAGE, OR IN RESTORATION  OF  A  POWER  OUTAGE,  SHALL
IMPOSE  CIVIL  PENALTIES  AGAINST SUCH COMPANY, NOT TO EXCEED A TOTAL OF
TWO AND ONE-HALF PERCENT OF SUCH COMPANY'S GROSS  ANNUAL  REVENUES  FROM
ELECTRIC  DISTRIBUTION.  IN  DETERMINING  THE AMOUNT OF ANY PENALTY, THE
COMMISSION MAY CONSIDER WHETHER SUCH COMPANY  RECOVERED  COSTS  INCURRED
PURSUANT  TO  PARAGRAPH  (D)  OF SUBDIVISION TWO OF THIS SECTION TO MEET
INFRASTRUCTURE RELIABILITY EFFORTS TO IMPROVE  SUCH  COMPANY'S  PERFORM-
ANCE.  ANY  SUCH PENALTY IMPOSED SHALL BE PAID TO THE CUSTOMERS OR RATE-
PAYERS OF SUCH COMPANY IN THE FORM OF A CREDIT, WHICH SHALL BE  CREDITED
WITHIN ONE HUNDRED TWENTY DAYS OF SUCH ORDER. ANY SUCH PENALTY SHALL NOT
BE  INCLUDED AS AN OPERATING EXPENSE OF SUCH COMPANY FOR THE PURPOSES OF
RATEMAKING.
  S 3. This act shall take effect immediately.

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