February 22, 2013



DIGEST OF SB 510 (Updated February 21, 2013 11:59 am - DI 103)

Citations Affected: IC 4-4; noncode.

Synopsis: Substitute natural gas contracts. Requires the Indiana finance authority to submit a final purchase contract, including amendments, and any other agreements with a producer of SNG to the utility regulatory commission (IURC). Authorizes the IURC, after notice and hearing, to approve, reject, or modify a final purchase contract if in the public interest. Specifies certain factors the IURC must consider before taking action. Requires the IURC to issue a final order within 180 days. Requires a court to award attorney's fees to the prevailing party in a civil action related to a final purchase contract. Authorizes the IURC to adopt rules, including rules establishing filing deadlines. Requires the IURC to study the sales price of natural gas and report the study results to the regulatory flexibility committee in an electronic format not later than November 1, 2013.

Effective: Upon passage; May 15, 2013.

Eckerty, Boots, Banks, Grooms, Holdman, Kruse, Leising, Schneider, Smith J, Steele, Walker, Waltz,
Young R Michael, Randolph, Stoops, Head, Landske, Arnold J, Young R, Skinner, Miller Pete

    January 14, 2013, read first time and referred to Committee on Utilities.
    February 21, 2013, amended, reported favorably _ Do Pass.

February 22, 2013

First Regular Session 118th General Assembly (2013)

PRINTING CODE. Amendments: Whenever an existing statute (or a section of the Indiana Constitution) is being amended, the text of the existing provision will appear in this style type, additions will appear in this style type, and deletions will appear in this style type.
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    A BILL FOR AN ACT to amend the Indiana Code concerning state offices and administration.

Be it enacted by the General Assembly of the State of Indiana:

SOURCE: IC 4-4-11.6-14; (13)SB0510.1.1. -->     SECTION 1. IC 4-4-11.6-14, AS ADDED BY P.L.2-2009, SECTION 2, IS AMENDED TO READ AS FOLLOWS [EFFECTIVE MAY 15, 2013]: Sec. 14. (a) The authority, either directly or as an assignee of an energy utility, may enter into purchase contracts for the purchase of SNG from coal gasification facilities.
    (b) The authority shall submit a final purchase contract the following to the commission for approval:
         (1) A final purchase contract, including any amendments, addenda, or other modifications made or added to the contract at any time.
        (2) Any other agreements entered into between the authority and a producer of SNG.

     (c) After notice and a hearing, the commission may approve, reject, or modify a final purchase contract that is filed with, pending before, or remanded or otherwise returned to the jurisdiction of the commission on or after May 15, 2013, if the commission finds that such action is in the public interest. The

commission shall consider the following before finding that an action under this subsection is in the public interest:
        (1) Whether the final purchase contract is structured in a way that lessens the impact of any price volatility in the natural gas market on retail end use customers.
        (2) Whether the assumptions underlying the model used to calculate the purchase price of SNG under the final purchase contract, including assumptions about the future price of natural gas and coal and the value of future byproducts of the coal gasification facility, adequately apportion financial risk between the SNG producer and retail end use customers.
        (3) The findings of any study conducted by the commission on the natural gas market and reported to the regulatory flexibility committee established under IC 8-1-2.6-4.
        (4) Any other factors the commission considers necessary.
The commission shall issue a final order not more than one hundred eighty (180) days after the date on which the authority submits the final purchase contract to the commission under subsection (b)(1).
    (d) This subsection applies to a civil action that is:
        (1) commenced after May 14, 2013; and
        (2) related to a final order issued under subsection (c).
The court shall award reasonable and necessary attorney's fees as part of the cost to the prevailing party in the civil action.
    (e) The commission may adopt rules under IC 4-22-2 to carry out the requirements of this section. A rule adopted under this subsection must establish filing and other procedural deadlines for all parties to a hearing under subsection (c).

SOURCE: ; (13)SB0510.1.2. -->     SECTION 2. [EFFECTIVE UPON PASSAGE] (a) Not later than November 30, 2013, the utility regulatory commission created by IC 8-1-1-2 shall:
        (1) conduct a study of the natural gas market, including:
            (A) natural gas prices on both the open and captive markets; and
            (B) the effect of the availability of substitute natural gas and shale gas on natural gas prices; and
        (2) report the study results in an electronic format under IC 5-14-6 to the regulatory flexibility committee established under IC 8-1-2.6-4.
    (b) This SECTION expires December 31, 2013.

SOURCE: ; (13)SB0510.1.3. -->     SECTION 3. An emergency is declared for this act.