SB454: Electric utilities; recovery of development costs associated with small modular reactor.


VIRGINIA ACTS OF ASSEMBLY -- CHAPTER
An Act to amend the Code of Virginia by adding a section numbered 56-585.1:14, relating to electric utilities; recovery of development costs associated with small modular reactor.
[S 454]
Approved

 

Be it enacted by the General Assembly of Virginia:

1. That the Code of Virginia is amended by adding a section numbered 56-585.1:14 as follows:

§ 56-585.1:14. Recovery of development costs associated with small modular reactor.

A. As used in this section:

"Small modular reactor" or "SMR" means a nuclear reactor that produces nuclear power and has a nameplate capacity that does not exceed 500 megawatts of generating capacity per reactor.

"SMR facility" means an SMR or multiple SMRs that generate electricity at a single site.

"SMR project development costs" or "project costs" means all costs associated with the development of one or more SMRs, including costs of evaluation, design, engineering, federal approvals and licensing, environmental analysis and permitting, early site permitting, equipment procurement, and authorized rate of return.

"Utility" means a Phase II Utility, as that term is defined in subdivision A 1 of § 56-585.1.

B. Notwithstanding any limitation under subdivision A 6 of § 56-585.1, the utility may petition the Commission at any time for approval of a rate adjustment clause pursuant to subdivision A 6 of § 56-585.1 for the recovery of SMR project development costs. The utility may petition the Commission for up to one SMR facility pursuant to this section. Such utilities may petition the Commission for SMR project development cost recovery along separate development phases and, if the Commission determines such projected or actual project costs to be reasonable and prudent, such project costs may be recovered by such utility on a timely and current basis from customers prior to any approval pursuant to subsection D of § 56-580 or the commercial operation date of any such SMR facility. Any SMR project development costs incurred prior to July 1, 2024, and 20 percent of SMR project development costs incurred after July 1, 2024, shall not be eligible for accelerated cost recovery pursuant to this section and may be recovered through the utility's rates for generation and distribution services pursuant to subdivision A 1 of § 56-585.1. The utility that petitions the Commission for recovery of SMR project development costs shall demonstrate that such utility has evaluated funding opportunities from the U.S. Department of Energy. Nothing in this section shall limit the Commission's discretion to determine whether the proposed SMR project development costs are reasonable and prudent. As part of a final order approving such cost recovery, the Commission may impose a deadline by which the relevant utility shall either (i) place an SMR into commercial operation or (ii) sell the permitted site, unless it is at a previously existing nuclear site, and return the proceeds of the sale to customers. The length of such deadline shall be at the Commission's discretion; however, it shall provide the utility a reasonable timeframe in which to obtain all necessary permits and approvals, including allowing for approval by federal agencies such as the Nuclear Regulatory Commission, and completing construction of an SMR.

C. Nothing in this section shall limit the Commission's authority to approve or deny a petition for recovery of SMR project development costs or to require a utility to demonstrate that such utility made reasonable good-faith efforts to secure appropriate funding opportunities from the U.S. Department of Energy. The annual revenue requirement for any rate adjustment clause authorized pursuant to this section shall not exceed an amount that would increase the monthly bill of the utility's typical Virginia residential customer, utilizing 1,000 kilowatt hours of electricity monthly, by more than $1.40.

2. That the provisions of this act shall expire on December 31, 2029.


SENATE BILL NO. 454
AMENDMENT IN THE NATURE OF A SUBSTITUTE
(Proposed by the Governor
on April 8, 2024)
(Patron Prior to Substitute--Senator Marsden)
A BILL to amend the Code of Virginia by adding a section numbered 56-585.1:14, relating to electric utilities; recovery of development costs associated with small modular reactor.

Be it enacted by the General Assembly of Virginia:

1. That the Code of Virginia is amended by adding a section numbered 56-585.1:14 as follows:

§ 56-585.1:14. Recovery of development costs associated with small modular reactor.

A. As used in this section:

"Small modular reactor" or "SMR" means a nuclear reactor that produces nuclear power and has a nameplate capacity that does not exceed 500 megawatts of generating capacity per reactor.

"SMR facility" means an SMR or multiple SMRs that generate electricity at a single site.

"SMR project development costs" or "project costs" means all costs associated with the development of one or more SMRs, including costs of evaluation, design, engineering, federal approvals and licensing, environmental analysis and permitting, early site permitting, equipment procurement, and authorized rate of return.

"Utility" means a Phase II Utility, as that term is defined in subdivision A 1 of § 56-585.1.

B. Notwithstanding any limitation under subdivision A 6 of § 56-585.1, the utility may petition the Commission at any time for approval of a rate adjustment clause pursuant to subdivision A 6 of § 56-585.1 for the recovery of SMR project development costs. The utility may petition the Commission for up to one SMR facility pursuant to this section. Such utilities may petition the Commission for SMR project development cost recovery along separate development phases and, if the Commission determines such projected or actual project costs to be reasonable and prudent, such project costs may be recovered by such utility on a timely and current basis from customers prior to any approval pursuant to subsection D of § 56-580 or the commercial operation date of any such SMR facility. Any SMR project development costs incurred prior to July 1, 2024, and 20 percent of SMR project development costs incurred after July 1, 2024, shall not be eligible for accelerated cost recovery pursuant to this section and may be recovered through the utility's rates for generation and distribution services pursuant to subdivision A 1 of § 56-585.1. The utility that petitions the Commission for recovery of SMR project development costs shall demonstrate that such utility has evaluated funding opportunities from the U.S. Department of Energy. Nothing in this section shall limit the Commission's discretion to determine whether the proposed SMR project development costs are reasonable and prudent. As part of a final order approving such cost recovery, the Commission may impose a deadline by which the relevant utility shall either (i) place an SMR into commercial operation or (ii) sell the permitted site, unless it is at a previously existing nuclear site, and return the proceeds of the sale to customers. The length of such deadline shall be at the Commission's discretion; however, it shall provide the utility a reasonable timeframe in which to obtain all necessary permits and approvals, including allowing for approval by federal agencies such as the Nuclear Regulatory Commission, and completing construction of an SMR.

C. Nothing in this section shall limit the Commission's authority to approve or deny a petition for recovery of SMR project development costs or to require a utility to demonstrate that such utility made reasonable good-faith efforts to secure appropriate funding opportunities from the U.S. Department of Energy. The annual revenue requirement for any rate adjustment clause authorized pursuant to this section shall not exceed an amount that would increase the monthly bill of the utility's typical Virginia residential customer, utilizing 1,000 kilowatt hours of electricity monthly, by more than $1.40.

2. That the provisions of this act shall expire on December 31, 2029.


VIRGINIA ACTS OF ASSEMBLY -- CHAPTER
An Act to amend the Code of Virginia by adding a section numbered 56-585.1:14, relating to electric utilities; recovery of development costs associated with small modular reactor.
[S 454]
Approved

 

Be it enacted by the General Assembly of Virginia:

1. That the Code of Virginia is amended by adding a section numbered 56-585.1:14 as follows:

§ 56-585.1:14. Recovery of development costs associated with small modular reactor.

A. As used in this section:

"Small modular reactor" or "SMR" means a nuclear reactor that produces nuclear power and has a nameplate capacity that does not exceed 500 megawatts of generating capacity per reactor.

"SMR facility" means an SMR or multiple SMRs that generate electricity at a single site.

"SMR project development costs" or "project costs" means all costs associated with the development of one or more SMRs, including costs of evaluation, design, engineering, federal approvals and licensing, environmental analysis and permitting, early site permitting, equipment procurement, and authorized rate of return.

"Utility" means a Phase II Utility, as that term is defined in subdivision A 1 of § 56-585.1.

B. Notwithstanding any limitation under subdivision A 6 of § 56-585.1, each utility may petition the Commission at any time for approval of a rate adjustment clause pursuant to subdivision A 6 of § 56-585.1 for the recovery of SMR project development costs. Each utility may petition the Commission for up to one SMR facility pursuant to this section. Such utilities may petition the Commission for SMR project development cost recovery along separate development phases and, if the Commission determines such projected or actual project costs to be reasonable and prudent, any such project costs may be recovered by such utilities on a timely and current basis from customers prior to any approval pursuant to subsection D of § 56-580 or the commercial operation date of any such SMR facility. Each utility that petitions the Commission for recovery of SMR project development costs must demonstrate that such utility has evaluated funding opportunities from the U.S. Department of Energy. Nothing in this section shall limit the Commission's discretion to determine whether the proposed SMR project development costs are reasonable and prudent. As part of a final order approving such cost recovery, the Commission may impose a deadline by which the relevant utility must either (i) place an SMR into commercial operation or (ii) sell the permitted site, unless it is at a previously existing nuclear site, and return the proceeds of the sale to customers. The length of such deadline shall be at the Commission's discretion; however, it shall provide the utility a reasonable timeframe in which to obtain all necessary permits and approvals, including allowing for approval by federal agencies such as the Nuclear Regulatory Commission, and completing construction of an SMR.

C. Nothing in this section shall limit the Commission’s authority to approve or deny a petition for recovery of SMR project development costs or to require a utility to demonstrate that such utility made reasonable good-faith efforts to secure appropriate funding opportunities from the U.S. Department of Energy. The annual revenue requirement for any rate adjustment clause authorized pursuant to this section shall not exceed an amount that would increase a utility’s typical residential customer bill by more than $1.75 per month.

2. That the provisions of this act shall expire on December 31, 2029.


SENATE BILL NO. 454
AMENDMENT IN THE NATURE OF A SUBSTITUTE
(Proposed by the House Committee on Labor and Commerce
on February 27, 2024)
(Patron Prior to Substitute--Senator Marsden)
A BILL to amend the Code of Virginia by adding a section numbered 56-585.1:14, relating to Phase I Utility; recovery of development costs associated with small modular nuclear facility.

Be it enacted by the General Assembly of Virginia:

1. That the Code of Virginia is amended by adding a section numbered 56-585.1:14 as follows:

§ 56-585.1:14. Recovery of development costs associated with small modular nuclear facility.

A. As used in this section:

"Phase I Utility" means an investor-owned incumbent electric utility that was, as of July 1, 1999, not bound by a rate case settlement adopted by the Commission that extended its application beyond January 1, 2002.

"Project development costs" means all capital and operation and maintenance costs associated with a potential small modular nuclear facility incurred by a Phase I Utility before issuance of a certificate for a small modular nuclear facility located in the Commonwealth, including the costs of evaluation, design, engineering, environmental analysis and permitting, land option, and early site permitting, as that term is defined in 10 C.F.R. § 52.1. "Project development costs" does not include the costs to obtain construction permits, combined licensing costs required by the Nuclear Regulatory Commission, or construction costs other than construction costs necessary for early site permitting.

"Small modular nuclear facility" means a nuclear reactor that has a rated electric generating capacity of not more than 500 megawatts that is capable of being constructed and operated either alone or in combination with one or more similar reactors at a single site.

B. At any time prior to the filing of an application for a certificate to construct a small modular nuclear facility to serve customers in the Commonwealth or in West Virginia, a Phase I Utility may request the Commission to review the Phase I Utility's decision to incur project development costs. The Commission shall hold a hearing regarding the request and shall issue a final order within 180 days after the date on which the Phase I Utility files its request.

C. All approved reasonable and prudent project development costs incurred for a potential small modular nuclear facility shall be recovered through a rate adjustment clause filed pursuant to subdivision A 6 of § 56-585.1, amortized over a period equal to the period during which the costs were incurred or five years, whichever is greater.

D. If a Phase I Utility serves customers in more than one jurisdiction, the percentage of project development costs to be recovered shall be equal to the percentage of associated energy and capacity from the small modular nuclear facility that is assigned to serve customers located in the Commonwealth.

E. As part of a final order approving cost recovery pursuant to this section, the Commission may impose a deadline by which the Phase I Utility shall either (i) place a small modular nuclear facility into commercial operation or (ii) sell the permitted site and return the proceeds of the sale to customers. The length of such deadline shall be at the Commission's discretion; however, it shall provide the utility a reasonable timeframe in which to obtain all necessary permits and approvals, including allowing for approval by federal agencies such as the Nuclear Regulatory Commission, and completing construction of a small modular nuclear facility.

2. That the provisions of this act shall expire on July 1, 2034.


SENATE BILL NO. 454
AMENDMENT IN THE NATURE OF A SUBSTITUTE
(Proposed by the Senate Committee on Commerce and Labor
on February 9, 2024)
(Patron Prior to Substitute--Senator Marsden)
A BILL to amend the Code of Virginia by adding a section numbered 56-585.1:14, relating to electric utilities; recovery of development costs associated with small modular reactor.

Be it enacted by the General Assembly of Virginia:

1. That the Code of Virginia is amended by adding a section numbered 56-585.1:14 as follows:

§ 56-585.1:14. Recovery of development costs associated with small modular reactor.

A. As used in this section:

"Small modular reactor" or "SMR" means a nuclear reactor that produces nuclear power and has a nameplate capacity that does not exceed 500 megawatts of generating capacity per reactor.

"SMR facility" means an SMR or multiple SMRs that generate electricity at a single site.

"SMR project development costs" or "project costs" means all costs associated with the development of one or more SMRs, including costs of evaluation, design, engineering, federal approvals and licensing, environmental analysis and permitting, early site permitting, equipment procurement, and authorized rate of return.

"Utility" means a Phase I Utility or a Phase II Utility, as those terms are defined in subdivision A 1 of § 56-585.1.

B. Notwithstanding any limitation under subdivision A 6 of § 56-585.1, each utility may petition the Commission at any time for approval of a rate adjustment clause pursuant to subdivision A 6 of § 56-585.1 for the recovery of SMR project development costs. Each utility may petition the Commission for up to one SMR facility pursuant to this section. Such utilities may petition the Commission for SMR project development cost recovery along separate development phases and, if the Commission determines such projected or actual project costs to be reasonable and prudent, any such project costs may be recovered by such utilities on a timely and current basis from customers prior to any approval pursuant to subsection D of § 56-580 or the commercial operation date of any such SMR facility. Each utility that petitions the Commission for recovery of SMR project development costs must demonstrate that such utility has evaluated funding opportunities from the U.S. Department of Energy. Nothing in this section shall limit the Commission's discretion to determine whether the proposed SMR project development costs are reasonable and prudent. As part of a final order approving such cost recovery, the Commission may impose a deadline by which the relevant utility must either (i) place an SMR into commercial operation or (ii) sell the permitted site, unless it is at a previously existing nuclear site, and return the proceeds of the sale to customers. The length of such deadline shall be at the Commission's discretion; however, it shall provide the utility a reasonable timeframe in which to obtain all necessary permits and approvals, including allowing for approval by federal agencies such as the Nuclear Regulatory Commission, and completing construction of an SMR.

SENATE BILL NO. 454

Offered January 10, 2024
Prefiled January 9, 2024
A BILL to amend the Code of Virginia by adding a section numbered 56-585.1:14, relating to electric utilities; recovery of development costs associated with small modular reactor.
Patron-- Marsden

Referred to Committee on Commerce and Labor

Be it enacted by the General Assembly of Virginia:

1. That the Code of Virginia is amended by adding a section numbered 56-585.1:14 as follows:

§ 56-585.1:14. Recovery of development costs associated with small modular reactor.

A. As used in this section:

"Small modular reactor" or "SMR" means a nuclear reactor that produces nuclear power and has a nameplate capacity that does not exceed 500 megawatts of generating capacity per reactor.

"SMR project development costs" or "project costs" means all costs associated with the development or construction of one or more SMRs, including costs of evaluation, design, engineering, federal approvals and licensing, environmental analysis and permitting, early site permitting, equipment procurement, construction, and financing costs.

"Utility" means a Phase I Utility or a Phase II Utility, as those terms are defined in subdivision A 1 of § 56-585.1.

B. Notwithstanding any limitation under subdivision A 6 of § 56-585.1, a utility may petition the Commission at any time for approval of a rate adjustment clause pursuant to subdivision A 6 of § 56-585.1 for the recovery of SMR project development costs. Such utility may petition the Commission for SMR project development cost recovery along separate development phases and, if the Commission determines such projected or actual project costs to be reasonable and prudent, any such project costs may be recovered by the utility on a timely and current basis from customers prior to any approval pursuant to subsection D of § 56-580 or the commercial operation date of any such SMR facility. Nothing in this section shall limit the Commission's discretion to determine whether the proposed SMR project development costs are reasonable and prudent.