A BILL TO BE ENTITLED
AN ACT providing that the utilities commission shall not authorize cost recovery for transporting natural gas unless the natural gas local distribution company proves that the transportation cost is the lowest cost available option to meet the needs of its retail customers.
The General Assembly of North Carolina enacts:
SECTION 1.  G.S. 62‑133.4 reads as rewritten:
"§ 62‑133.4.  Gas cost adjustment for natural gas local distribution companies; cost recovery for transporting natural gas.
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(c1)	The Commission shall not authorize a rate change under G.S. 62‑133 or this section to allow for the recovery of the cost of transporting natural gas unless the natural gas local distribution company can prove by a preponderance of evidence that, at the time the contract giving rise to the transportation costs for which recovery is sought was executed, the company had (i) identified and determined the date and amount of new fueling resource it needed; (ii) objectively studied all available alternative fueling resource options, including options other than new capacity contracts to meet the identified and determined need; and (iii) concluded on the basis of the identifications, determinations, and studies that the pipeline capacity contracts were the lowest‑cost available option, taking into consideration fixed and variable costs and a reasonable projection of utilization. In making its determination under this section, the Commission shall consider the company's information and data for a historical 12‑month period concerning the company's actual cost of transporting natural gas and transportation volumes."
SECTION 2.  This act is effective when it becomes law, and applies to rates fixed on or after that date.