SB489 Summary

• Changes the reference date for cost allocation methodology from January 1, 2015 to January 1, 2021 for electric utilities and natural gas utilities under the Formula Rate Review Act.

• For electric utilities with large industrial customers (annual usage exceeding 5 million megawatt hours), requires automatic approval of a five-year extension of formula rate review terms if requested by March 15, 2021, and mandates specific cost allocation adjustments during extension periods.

• Allows electric utilities meeting the 5 million megawatt hour threshold to implement demand-based cost allocation without regard to findings about economic development or employment opportunities.

• Establishes detailed procedures for extension terms including debt-to-equity ratio fixation, limitations on short-term debt assumptions, and requirements that utilities base projected year investments on historical averages rather than corporate budgets.

• Declares an emergency clause making the act effective immediately upon governor approval to maintain stable utility rates and clarify investment procedures for public utilities.