Section R14-2-1606. Services Required to be Made Available

A.      On the date its service area is open to competition under R14- 2-1602, each Affected Utility or Utility Distribution Company shall make available Standard Offer Service and Noncompeti- tive Services at regulated rates. After January 1, 2001, Stan- dard Offer Service and Noncompetitive Services shall be provided by Utility Distribution Companies who shall also act as Providers of Last Resort.

B.       After January 1, 2001, power purchased by an investor owned Utility Distribution Company for Standard Offer Service shall be acquired from the competitive market through prudent, arm’s length transactions, and with at least 50% through a competitive bid process.

C.      Standard Offer Tariffs

1.        By July 1, 1999, or pursuant to Commission Order, whichever occurs first, each Affected Utility shall file proposed tariffs to provide Standard Offer Service. Such rates shall not become effective until approved by the Commission. Any rate increase proposed by an Affected Utility or Utility Distribution Company for Standard Offer Service must be fully justified through a rate case proceeding.

2.        Standard Offer Service tariffs shall include the following elements, each of which shall be clearly unbundled and identified in the filed tariffs:

a.         Competitive Services:

i.         Generation, which shall include all transaction costs and line losses;

ii.        Competition Transition Charge, which shall include recovery of generation related regula- tory assets;

iii.      Generation-related billing and collection;

iv.       Transmission Services;

v.        Metering Services;

vi.       Meter Reading Services; and

vii.     Optional Ancillary Services, which shall include spinning reserve service, supplemental reserve, regulation and frequency response ser- vice, and energy imbalance service.

b.        Non-Competitive Services:

i.         Distribution services;

ii.        Required Ancillary services, which shall include scheduling, system control and dis- patch service, and reactive supply and voltage control from generation sources service;

iii.      Must-Run Generating Units;

iv.       System Benefit Charges; and

Corporation Commission – Fixed Utilities

v.        Distribution-related billing and collection.

3.        Affected Utilities and Utility Distribution Companies may file proposed revisions to such rates with the Com- mission through Docket Control. Any rate increase pro- posed by an Affected Utility or Utility Distribution Company for Standard Offer Service must be fully justi- fied through a rate case proceeding, which may be expe- dited at the discretion of the Utilities Division Director.

4.        Such rates shall reflect the costs of providing the service.

5.        Consumers receiving Standard Offer Service are eligible for potential future rate reductions as authorized by the Commission.

6.        After January 2, 2001, tariffs for Standard Offer Service shall not include any special discounts or contracts with terms, or any tariff that prevents the customer from accessing a competitive option, other than time-of-use rates, interruptible rates, or self-generation deferral rates.

D.      By the effective date of these rules, or pursuant to Commission Order, whichever occurs first, each Affected Utility or Utility Distribution Company shall file an Unbundled Service tariff that shall include a Noncompetitive Services tariff. The Unbundled Service tariff shall calculate the items listed in R14-2-1606(C)(2)(b) on the same basis as those items are cal- culated in the Standard Offer Service tariff.

E.       To manage its risks, an Affected Utility or Electric Service Provider may include in its tariffs deposit requirements and advance payment requirements for Unbundled Services.

F.       Affected Utilities and Utility Distribution Companies must accept power and energy delivered to their distribution sys- tems by other Load-Serving Entities and offer distribution and distribution-related ancillary services comparable to services they provide to themselves at their Noncompetitive Services tariffed rates.

G.      Customer Data

1.        Upon written authorization by the customer, a Load-Serv- ing Entity shall release in a timely and useful manner that customer’s billing data, including consumption, demand, and power factor (if available), for the most recent 12- month period to a customer-specified properly certifi- cated Electric Service Provider.

2.        The Electric Service Provider requesting such customer data shall provide an accurate account number for the customer.

3.        The form of data shall be mutually agreed upon by the parties and such data shall not be unreasonably withheld.

4.        Utility Distribution Companies shall be allowed access to the Meter Reading Service Provider server for customers served by the Utility Distribution Company’s distribution system.

H.      Rates for Unbundled Services

1.        The Commission shall review and approve rates for Com- petitive Services and Noncompetitive Services subject to Commission jurisdiction, before such services can be offered.

2.        Such rates shall reflect the costs of providing the services.

3.        Such rates may be downwardly flexible if approved by the Commission.

I.        Electric Service Providers offering Competitive Services under this R14-2-1606 shall provide adequate supporting doc- umentation for their proposed rates. Where rates are approved by another jurisdiction, such as the Federal Energy Regulatory Commission, those rates shall be provided as part of the sup- porting documentation.

Historical Note

Adopted effective December 26, 1996, under an exemp- tion as determined by the Arizona Corporation Commis-

sion (Supp. 96-4). Amended by an emergency action effective August 10, 1998, pursuant to A.R.S. § 41-1026, in effect for a maximum of 180 days (Supp. 98-3). Emer- gency amendment replaced by exempt permanent amend- ment effective December 31, 1998 (Supp. 98-4).

Amended by exempt rulemaking at 5 A.A.R. 3933, effec- tive September 24, 1999 (Supp. 99-3). Amended by exempt rulemaking at 6 A.A.R. 4180, effective October 13, 2000 (Supp. 00-4).

Note

Editor’s Note: The Arizona Corporation Commission has determined that the following Section is exempt from the Attorney General approval provisions of the Arizona Administrative Proce- dure Act (A.R.S. § 41-1041) by a court order (State ex. rel. Corbin

v. Arizona Corporation Commission, 174 Ariz. 216 848 P.2d 301 (App. 1992)).