(a) The Commission may require every public utility to file with the Commission complete schedules of every classification employed and of every individual or joint rate, fare or charge made, charged or executed by the public utility for any regulated product or service supplied or rendered within this State. Every application for a certificate of public convenience and necessity shall include a proposed tariff for approval by the Commission. A copy of all regulated tariffs then in effect shall be available for inspection by customers at each public office of the utility where applications for service are received.

(b) This section shall not apply to charges made for electric supply service or for transmission or ancillary services on and after October 1, 1999, for Delmarva Power & Light Company and April 1, 2000, for Delaware Electric Cooperative.

(c) Any person or entity in the business of a wastewater utility as of June 7, 2004, and subject to the supervision and regulation of the Commission under this chapter shall file a schedule of its rates in effect as of June 7, 2004, by November 3, 2004, in such form as the Commission may require. On July 6, 2004, such wastewater utility’s rates will be deemed in effect pending the outcome of an initial rate change request application filed in accordance with this title. Such application must be filed by January 2, 2005. A wastewater utility required to make such a rate filing may seek the assistance of the Commission in preparing its rate filing. Rates in effect on July 6, 2004, shall be deemed temporary and not subject to change, unless ordered by the Commission. Section 306 of this title shall not apply pending the outcome of this initial rate setting case. The Commission shall have 9 months to complete its review following the filing of the rate change application. However, to the extent possible, the Commission shall attempt to expedite such application. For good cause shown, the Commission may waive any provision of this subsection.

(d) Notwithstanding any other law, no public utility may assess switched access rates pursuant to tariff that are higher than the switched access rates set forth in the tariffs of the incumbent local exchange provider in the same service territory.

(e) Notwithstanding any other law, a public utility that provides telecommunications services shall not be subject to mandatory tariff or other filing requirements except with respect to switched access service.

(f) Rate transparency. —

(1) Each public utility shall prepare, maintain, and file with the Commission for approval, for each customer class it serves, a rate summary table for each rate class showing the total effective rate and itemizing each rate element including each base rate element; each transmission and supply element; and each rider, surcharge, and adjustment mechanism, including, statutory charges, distribution system improvement charge, and any other Commission approved rider or surcharge.

(2) Each component in the rate summary table shall be displayed numerically, using the same units in which the customer is billed. Beginning September 1, 2027, Commission regulated electric utilities shall bill standard offer service customers transmission charges in the same monthly billing determinants as distribution rates.

(3) The rate summary table shall include a schedule that identifies the components of rates that change on a predictable schedule (for example, rates that change annually) and the cadence of such change during the calendar year.

(4) The Commission may reject or require revisions to any rate summary table that it deems incomplete, inaccurate, or inconsistent with approved rates.

(5) The public utility shall include the rate summary table in the public utility’s tariff as a separate, clearly labeled section, post the rate summary table for each customer class in an easily accessible location on its website, include the rate summary table for that customer class in its customer bills, and file with the Commission and update in each of the foregoing locations an updated rate summary table at least 30 days after the effective date of any change to any component of its rates.

47 Del. Laws, c. 254, §  3;  26 Del. C. 1953, §  128;  59 Del. Laws, c. 397, §  1;  72 Del. Laws, c. 10, §  11;  74 Del. Laws, c. 317, §  7;  78 Del. Laws, c. 174;  79 Del. Laws, c. 53, §  7;  85 Del. Laws, c. 342, § 2; 

In all public facing and customer communications and any submissions to the Commission, public utilities, commission staff, and the Division of the Public Advocate should use clear and plain language to the maximum extent possible. Technical terms, abbreviations, and other technical nomenclature should be avoided wherever possible. Where technical language is necessary for specificity, it should be used only to the minimum degree necessary and shall be explained in the simplest form possible.

85 Del. Laws, c. 342, § 2; 

(a) The Commission may, from time to time, ascertain and determine the rate base of any public utility whenever, in the judgment of the Commission, it is necessary so to do for the purpose of carrying out this chapter, and in making such determination the Commission may have access to and use any books, documents, or records in the possession of any department, board, commission or agency of this State or any political subdivision thereof. In ascertaining and determining the rate base, the Commission may determine every fact, matter, or thing which, in its judgment, does or may have any bearing thereon. For electric and natural gas distribution companies the Commission shall use the average year rate base method.

(b) If a water utility is not, pursuant to § 122(3)c. of Title 16, under review concerning its water system’s ability to provide adequate service to its customers under its present certificates of public convenience and necessity or subject to a review by the Commission of the appropriate rates to be charged by the water utility in light of the quality of service being provided to its customers, the Commission will include in the utility’s rate base, treat as used and useful utility plant, and, accordingly, allow to be fully recovered in the utility’s rates without imputation of revenues, all just and reasonable, and prudent costs which are incurred by the water utility in constructing facilities (including without limitation supply, treatment and transmission facilities) to serve the needs of existing customers or of persons who are reasonably anticipated by the water utility to be its customers within 3 years from the date used by the Commission to recognize rate base in the rate proceeding. The number of customers reasonably anticipated to be added within that 3-year period will consist of customer projections which are relied on by the utility and are generated by professional engineers or planners, governmental or regulatory agencies, officials or authorities, or the water utility itself, and which are not arbitrary and capricious. If the water utility does not, by the end of the 3-year period after the date used by the Commission to recognize rate base in the rate proceeding, reach at least 75% of the total number of customers originally anticipated to be served by the facilities, the Commission may only then require the water utility to impute revenues and then only to the extent of the number of customers it originally anticipated to be served by the facilities but who have not, as of the end of the 3-year period, been added.

59 Del. Laws, c. 397, §  1;  72 Del. Laws, c. 402, §  7;  85 Del. Laws, c. 78, § 1;  85 Del. Laws, c. 342, § 2; 

(a) Except as set forth in subsection (e) of this section, a public utility may not make, impose, or exact any unjust or unreasonable or unduly preferential or unjustly discriminatory individual or joint rate for any product or service supplied or rendered by it within the State, or adopt, maintain or enforce any regulation, practice or measurement which is unjust, unreasonable, unduly preferential or unjustly discriminatory or otherwise in violation of law, or make, or give, directly or indirectly, any undue or unreasonable preference or advantage to any person or corporation or to any particular description of traffic, in any respect whatsoever.

(b) The Commission shall require all utilities operating within its jurisdiction to produce evidence at a public hearing of the need for a change in the fuel adjustment as a part of the rate-making procedure. Notwithstanding any other provisions of this chapter, such fuel adjustment may include a separate component to adjust for or correct for any difference between actual allowable fuel costs incurred by the utility and fuel costs recovered through base rates and the fuel adjustment. Notice of such hearing shall be advertised in at least 1 newspaper in each of the 3 counties. As in other applications before the Commission, the burden of proof that the fuel adjustment change is required shall be upon the utility. No change in the fuel adjustment shall be authorized by the Commission except by affirmative vote of the majority of all members appointed to the Commission. The Commission shall consider the evidence for and against the proposed change as it would all evidence in any other ratemaking procedure. Consistent with the introduction of customer choice in the supply of electricity pursuant to Chapter 10 of this title, and subject to subsection (c) of this section below, this section shall have no application to rates in effect on and after October 1, 1999, for Delmarva Power & Light Company and April 1, 2000, for Delaware Electric Cooperative.

(c) Notwithstanding subsection (b) of this section, the Commission shall determine the actual overrecovered or underrecovered deferred fuel balance for each electric distribution company as of September 30, 1999, for Delmarva Power & Light Company and March 31, 2000, for Delaware Electric Cooperative. Such overrecovery or underrecovery shall be either returned to or collected from that electric distribution company’s retail electric customers by a mechanism that is designed to provide a full credit or charge of the actual deferred fuel balance and that the Commission shall adopt and order to be effective no later than 90 days after such dates. The Commission shall adopt either a single bill credit or charge mechanism or an alternative per kilowatt-hour credit or charge mechanism to be in effect for up to a period of 12 months, depending upon the relative size of the actual amount to be credited or charged to retail electric customers. No further adjustments of such amounts shall be required.

(d) (1) The Commission shall authorize a public utility to establish an individual or joint rate for any product supplied or service rendered within the State for the purposes of ensuring the State’s current and future economic well-being and growth where prior to authorizing such individual or joint rate the Commission finds:

a. That such rate is in the public interest;

b. That such rate prevents the loss of customers, encourages customers to expand present facilities and operations in Delaware and/or attracts new customers where necessary or appropriate to promote economic development in Delaware. This finding shall include, but is not limited to, a determination that the new or existing customer or the growth in an existing customer represents at least 25 jobs and/or at least $2 million in capital expenditures;

c. That such rate shall provide recovery of at least the incremental cost (including capital cost) of providing the relevant utility services;

d. If, how, and to what extent any discount being authorized below a relevant standard tariff rate shall be recovered; and

e. The period of time during which such rate shall remain in effect, normally up to 5 years.

(2) In addition to the above specific findings, the Commission shall also consider, among other things, the following items:

a. The utility’s load and capacity situation;

b. The portion that the relevant utility service makes up of the customer’s total operating expenses;

c. Viable economic alternatives to the utility service available to the customer;

d. The customer’s ability to relocate, if relevant;

e. Reasonable efforts that the customer has made to secure government grants and/or other concessions; and

f. The effect, if any, on competitors located in Delaware of the customer or customers to which such rate may apply.

(e) (1) The Commission may authorize an electric or natural gas public utility to establish an individual or joint rate for any product supplied or service rendered within the State for the purpose of ensuring basic utility service for the State’s low-income residential customers where prior to authorizing such individual or joint rate, the Commission finds all of the following:

a. That such rate is in the public interest.

b. That such rate provides a 20% discount from standard residential distribution costs.

(2) Cost of credits and incremental administrative costs shall be deferred and recoverable through the Low-Income Program Fund described in § 1014(b) of this title or other means if a utility does not participate in a Low-Income Program Fund, subject to commission review and reconciliation on an annual basis. Commission-regulated utilities must petition the Commission to open a regulatory asset to track deferred costs associated with implementing the low-income rate. Commission-regulated utilities may not request nor receive a return on the regulatory asset. Commission-regulated utilities may recover incremental administrative costs through the deferral process.

(3) An electric or natural gas public utility approved for a low-income rate under this subsection must include information about the rate in a bill insert.

(4) Eligibility for a low-income rate under this section will be determined annually as follows:

a. A participating electric or natural gas public utility may submit the names and other required personal identifying information of applicants for the low-income residential rate to the Department of Health and Social Services (DHSS), but only if the applicant has provided written or electronic consent for the sharing of the applicant’s information between the participating electric or natural gas public utility and DHSS; or

b. Upon receipt of an applicant’s consent and information, DHSS will notify the participating electric or natural gas utility if the applicant is eligible for the low-income rate, based on participation in, or eligibility to participate in, a means-tested program administered by the Division of Social Services.

c. Written or electronic consent for information to be shared must be obtained annually upon redetermination of eligibility for the low-income residential rate.

d. For purposes of this section, the term “low-income residential customer” means a residential utility customer who is eligible for a means-tested program administered by the Division of Social Services.

(5) An electric or natural gas utility that offers a low-income residential rate must provide customers approved for that rate with information and referrals to available energy efficiency programs such as those offered through Energize Delaware.

(6) The Commission must review a discount rate authorized under paragraph (e)(1) of this section every 5 years and determine whether such rate should be re-authorized.

47 Del. Laws, c. 254, §  7;  26 Del. C. 1953, §  161;  59 Del. Laws, c. 397, §  1;  60 Del. Laws, c. 431, §  1;  65 Del. Laws, c. 17, §  1;  65 Del. Laws, c. 240, §  1;  70 Del. Laws, c. 48, §  5;  72 Del. Laws, c. 10, §§  12, 13;  85 Del. Laws, c. 82, § 1; 

(a) Unless the Commission otherwise orders, no public utility shall make any change in any existing rate except after 60 days notice to the Commission, which notice shall plainly state the changes proposed to be made in the rates then in force and the time when the changes will go into effect, and for changes to base rates, shall include the test period and test year applicable for the request. All proposed changes shall be shown by filing new schedules or shall be plainly indicated upon schedules filed and in force at the time and kept open to public inspection. Public notice of all proposed changes shall be given in a form and manner set by the Public Utilities Commission. The Commission, for good cause shown, may allow changes in rates without requiring the 60-days’ notice and/or public notice under such conditions as it may prescribe. All such changes shall be immediately indicated upon its schedules by such public utility.

(b) In prescribing conditions for rate changes, the Commission is specifically authorized and empowered to conduct proceedings in which it limits the number or type of issues it will consider in determining whether or not to permit or allow such changes. The Commission may adopt or change regulations to govern such limited issue rate proceedings.

(c) As part of any base rate change filing, a public utility may be subject to a regulatory accounting review of transactions included on the public utility’s books and records for ratemaking purposes, including transactions to and from affiliated companies to ensure transactions and other accounting entries are required only for the provision of regulated utility service. The regulatory accounting review may be conducted by staff for the Commission or such expert as selected by staff for the Commission. The regulatory accounting review may begin immediately upon the filing of the notice required by this section. The results of the regulatory accounting review shall be provided to all parties in the proceeding. A public utility shall not be subject to an accounting review as described in this section if there was a previous regulatory accounting review covering the same test year as proposed in the rate change filing.

47 Del. Laws, c. 254, §  5;  48 Del. Laws, c. 371, §  10;  26 Del. C. 1953, §  151;  59 Del. Laws, c. 397, §  1;  70 Del. Laws, c. 48, §  6;  70 Del. Laws, c. 585, §  4;  85 Del. Laws, c. 342, § 2; 

Whenever there is filed with the Commission by any public utility any schedule stating a new rate, the Commission may, either upon complaint or upon its own initiative, upon reasonable notice, enter upon a hearing concerning the lawfulness of such rate.

47 Del. Laws, c. 254, §  5;  48 Del. Laws, c. 371, §  10;  26 Del. C. 1953, §  152;  59 Del. Laws, c. 397, §  1; 

(a) The Commission, upon the filing of a petition for a proposed change to any rate, may within 60 days after said filing:

(1) Suspend the operation of such rate change for a period not to exceed 7 months after said filing; provided, however, that if the Commission has not reached its decision within said 7 months after filing, the public utility may place 50% of the increase in proposed new rate as compared to the existing rate into effect, and 75% after 12 months, under bond in accordance with subsection (b) of this section.

(2) Determine that a portion of such change shall become effective not later than 90 days after the filing of the petition on a temporary basis pending the final decision of the Commission.

(b) On or after the termination of the 7 months as set forth in paragraph (a)(1) of this section 50% of the proposed rate change, and 75% after 12 months, shall automatically become effective if the public utility files with the Commission a bond in a reasonable amount approved by the Commission with sureties approved by the Commission, conditioned upon the refund, in a manner to be prescribed by order of the Commission, to the persons entitled thereto of the amount of the excess, if the rate so put into effect is finally determined to be excessive; or there may be substituted for such bond other arrangements satisfactory to the Commission for the protection of the parties interested. In no event shall a public utility put a rate into effect under bond as authorized in this subsection that would constitute an increase in excess of 15% of the public utility’s gross intrastate operating revenues.

(c) Notwithstanding subsections (a) and (b) of this section, 90 days after said filing, a public utility may put a rate into effect under bond as authorized in subsection (b) of this section, provided that the increase does not constitute an increase in excess of 15% of the public utility’s annual gross intrastate operating revenues or $2,500,000 annually, whichever is less. This subsection shall not apply to any proposed rate change sought by a public utility under regulations adopted pursuant to § 304(b) of this title.

47 Del. Laws, c. 254, §  5;  48 Del. Laws, c. 371, §  10;  26 Del. C. 1953, §  153;  59 Del. Laws, c. 397, §  1;  61 Del. Laws, c. 254, §§  1-3;  70 Del. Laws, c. 48, §  7;  85 Del. Laws, c. 342, § 2; 

(a) In any proceeding upon the motion of the Commission, or upon complaint, or upon application of a public utility, involving any proposed or existing rate of any public utility, or any proposed change in rates, the burden of proof to show that the rate involved is just and reasonable, and prudent, which requires a showing that the rate involved allows for recovery of only those costs or expenses prudently incurred, is upon the public utility. In making the determination of whether a cost or expense was prudently incurred, the Commission must consider the objective reasonableness of the cost or expense incurred, based on what the public utility knew or reasonably should have known at the time the cost or expense was incurred. The Commission may determine that the cost or expense incurred is only partially prudent, and may adjust the elements of rate base, operating expenses, or fuel costs accordingly to reflect that determination.

(b) The public utility shall have the burden of proof in justifying every accounting entry of record questioned by the Commission which may suspend any charge or credit pending submission of satisfactory and sufficient proof in support thereof by the public utility.

(c) The Commission shall give preference to the hearing and decision of any rate proceeding over all other proceedings and decide the same as speedily as possible.

47 Del. Laws, c. 254, §  5A;  48 Del. Laws, c. 371, §  11;  26 Del. C. 1953, §  157;  59 Del. Laws, c. 397, §  1;  85 Del. Laws, c. 78, § 1; 

(a) (1) In exercising the jurisdiction and power conferred upon the Commission by § 201 of this title, the Commission, upon its own motion at any time it deems such action to be in the public interest or upon complaint duly filed with it, may take into consideration, among other things, the efficiency, sufficiency and adequacy of the facilities and products provided and services rendered by the public utility, the value of such services, products and facilities to the public, and the ability of the public utility to improve such services, products and facilities. During such proceeding, the Commission may consider any service complaints by subscribers and the public.

(2) If the Commission finds that the public utility’s facilities, products or services are inefficient, insufficient or inadequate, it may impose such penalty upon the public utility as may be necessary to restore such facilities, products or services to a state of efficiency, sufficiency or adequacy. Upon significant improvement in such services, products or facilities, the Commission may, after hearing, remove or reduce the penalty imposed.

(b) The power and authority herein conferred upon the Commission shall not be construed in any way to limit the general jurisdiction and power conferred upon the Commission by § 201 of this title, it being the legislative intent that efficient, sufficient and adequate services, products and facilities shall be provided by public utilities.

59 Del. Laws, c. 397, §  1; 

(a) The Commission may, after hearing, upon notice, by order in writing, fix just and reasonable individual rates, joint rates, charges or schedules thereof, as well as commutation, mileage and other special rates, which shall be imposed, observed and followed thereafter by any public utility whenever the Commission determines any existing individual rate, joint rate, toll, charge or schedule thereof, or commutation, mileage, or other special rate to be unjust, unreasonable, imprudent, insufficient, or unjustly discriminatory or preferential.

(b) No order of the Commission requiring a change in rates shall become operative until at least 30 days after service thereof except upon the written consent of the public utility affected.

59 Del. Laws, c. 397, §  1;  85 Del. Laws, c. 78, § 1; 

(a) Whenever the Commission, after due consideration of pertinent facts and information, is of the opinion that any rates of any public utility are producing a return in excess of a reasonable rate of return upon its rate base, or when appropriate, its operating ratio, and that a proceeding to determine all of the issues involved in a final determination of such rates will require more than 90 days, the Commission may, after reasonable notice to the public utility and opportunity to be heard thereon, if the public interest so requires, immediately enter a temporary order fixing a temporary schedule of rates to be charged by such public utility pending the final determination of such rate proceeding, which order shall become operative and binding upon such public utility at the time prescribed by the Commission.

(b) The power of the Commission to order reductions in rates and charges of any public utility by means of such temporary order shall be limited to reductions which will absorb not more than the amount found to be in excess of the amount of operating income, as determined by the Commission, necessary to provide a reasonable rate of return on the rate base of the public utility or when appropriate, its operating ratio.

(c) The temporary rate so prescribed shall be effective until the final determination of the rate proceeding, unless sooner terminated or changed by the Commission.

(d) If, upon final disposition of the issues involved in such proceeding, the rates as finally determined are in excess of the rates prescribed in such temporary order, then such public utility may amortize and recover by means of a temporary increase over and above the rates finally determined such sum as represents the difference between the operating revenues obtained from the rates prescribed in such temporary order and the operating revenues which would have been obtained under the rates finally determined if applied during the period such temporary order was in effect.

47 Del. Laws, c. 254, §  5A;  48 Del. Laws, c. 371, §  311;  26 Del. C. 1953, §  156;  59 Del. Laws, c. 397, §  1; 

If, after hearing, the Commission finds any existing or proposed rate unjust, unreasonable, imprudent, or unjustly discriminatory, or in any wise in violation of law, the Commission shall determine the just and reasonable rate to be charged or applied by the utility for the service in question, and shall fix the same by order to be served upon the utility; and such rate shall thereafter be observed until changed, as provided in this chapter. In determining the just and reasonable rate to be charged, the Commission shall consider the revenue needs of the utility, its past and projected rates of return on its rate base, or, when appropriate, its operating ratio.

47 Del. Laws, c. 254, §  5;  48 Del. Laws, c. 371, §  10;  26 Del. C. 1953, §  155;  59 Del. Laws, c. 397, §  1;  85 Del. Laws, c. 78, § 1; 

If the public utility fails to make refund within 90 days after the final determination by the Commission or by the court on appeal from the Commission’s order that the rate is excessive, any person entitled to such refund may sue therefor in any court of this State of competent jurisdiction and shall be entitled to recover, in addition to the amount of the refund due, all court costs and reasonable attorneys’ fees, but no action may be maintained for that purpose unless instituted within 2 years after such final determination. Any number of persons entitled to such refund may join as plaintiffs and recover their several claims in a single action, and in such action the court shall render a judgment severally for each plaintiff as each plaintiff’s interest may appear.

47 Del. Laws, c. 254, §  5;  48 Del. Laws, c. 371, §  10;  26 Del. C. 1953, §  154;  59 Del. Laws, c. 397, §  1;  84 Del. Laws, c. 42, § 127; 

The Commission may, after hearing, by order in writing, require every public utility to carry a reasonable and adequate depreciation account in accordance with such rules, regulations, orders and forms of account as the Commission may prescribe. The Commission may, from time to time, ascertain and determine, and by order fix, the proper and adequate rates of depreciation of the several classes of property of each public utility or class of public utilities. Each public utility shall conform its depreciation accounts to the rates so ascertained, determined and fixed.

47 Del. Laws, c. 254, §  4;  48 Del. Laws, c. 371, §  8;  26 Del. C. 1953, §  130;  59 Del. Laws, c. 397, §  1; 

(a) The following definitions shall apply in this section:

(1) As used in this section, “DSIC rate” refers to distribution system improvement charge.

(2) As used in this section, “DSIC costs” means depreciation expenses and pretax return associated with eligible distribution system improvements.

(3) As used in this section, “DSIC revenues” means revenues produced through a DSIC exclusive of revenues from all other rates and charges.

(4) As used in this section, “eligible distribution system improvements” means new, used and useful water utility plant projects that:

a. Do not increase revenues by connecting the distribution system to new customers; and

b. Are in service; and

c. Were not included in the public utility’s rate base in its most recent general rate case; and which

d. Replace or renew water mains, valves, services, meters and hydrants serving existing customers that have reached their useful service life, are worn out, are in deteriorated condition, or which negatively impact the quality and reliability of service to the customer if not replaced or renewed; or

e. Extend mains to eliminate dead ends which negatively impact the quality and reliability of service to the customer; or

f. Relocate existing facilities as a result of governmental actions that are not reimbursed, including but not limited to relocations of mains located in highway rights of way as required by the Department of Transportation; or

g. Place in service, for the benefit of the customers of the water utility applying for the DSIC rate, water supply sources identified as “A list projects” in the Governor’s Task Force Report dated December 2, 1999, to resolve the regional water supply concerns or subsequently added to the “A list projects” by the [former] Delaware Water Supply Coordinating Council, all such added projects to have been so identified by the [former] Delaware Water Supply Coordinating Counsel by December 31, 2002; or

h. Place in service new or additional water treatment facilities, plant or equipment required to meet changes in state or federal water quality standards, rules or regulations.

(5) As used in this section, “pretax return” means the revenues necessary to:

a. Produce net operating income equal to the public water utility’s weighted cost of capital as established in the most recent general rate proceeding for the public water utility multiplied by the net original cost of eligible distribution system improvements. At any time the Commission, by its own motion, or by motion of the water utility, Commission staff or the Public Advocate, may determine to revisit and, after hearing without the necessity of a general rate filing, reset a water utility’s cost of capital to reflect its current cost of capital. The DSIC rate shall be adjusted back to the date of the motion to reflect any change in the cost of capital determined by the Commission through this process;

b. Provide for the tax deductibility of the debt interest component of the weighted cost of capital; and

c. Pay state and federal income taxes applicable to such income.

(b) Notwithstanding other sections of this subchapter, a public utility providing water service may file with the Commission rate schedules establishing a DSIC rate that will allow for the automatic adjustment of the public water utility’s basic rates and charges to provide recovery of DSIC costs on a semiannual basis.

(1) The public water utility shall serve the Division of the Public Advocate’s office a copy of its filing at the time of its filing with the Commission. Customers of the public water utility shall be notified of changes in the DSIC rate by including appropriate information with the first bill they receive following any change in the rate.

(2) Publication of notice of the filing is not required.

(3) The effective date of changes in the DSIC rate shall be January 1 and July 1 every year.

(4) The public water utility shall file any request for a change in the DSIC rate and supporting data with the Commission at least 30 days prior to its effective date.

(5) The DSIC rate shall be adjusted semiannually for eligible distribution system improvements placed in service during the 6-month period ending 2 months prior to the effective date of changes in the DSIC rate.

(6) The DSIC rate shall be expressed as a percentage carried to 2 decimal places and applied to the total amount billed to each customer under the public water utility’s otherwise applicable rates and charges.

(7) The DSIC rate applied between base rate filings shall be capped at 7.5% of the amount billed to customers under otherwise applicable rates and charges, but the DSIC rate increase applied shall not exceed 5% within any 12-month period.

(8) The DSIC Rate shall be subject to audit at intervals determined by the Commission. It will also be subject to annual reconciliation based on a period consisting of the 12 months ending December 31 of each year. The revenue received under the DSIC Rate for the reconciliation period shall be compared to the public water utility’s eligible costs for that period with the difference between revenue received and eligible costs for the period recouped or refunded, as appropriate, over a 1-year period commencing July 1 of each year. If the DSIC Revenues exceeded the DSIC eligible costs, such over-collections shall be refunded with interest.

(9) The DSIC Rate shall be reset to zero as of the effective date of new base rates that provide for the prospective recovery of the annual costs theretofore recovered under the DSIC rate.

(10) The DSIC Rate shall also be reset to zero if, in any quarter, data filed with the Commission by the public water utility show that the public water utility will earn a rate of return that exceeds the rate of return established in its last general rate filing or by Commission order pursuant to paragraph (a)(5)a. of this section, if such was determined subsequent to the final order in the water utility’s last general rate filing. Further, the DSIC rate shall be reinstated when such data show that the established rate of return is not exceeded and will not be exceeded if the DSIC rate is reinstated and reset.

(11) Any water utility filing for interim rate relief under this section must comply with all reasonable information requests related to its filing, or any other audits or proceedings conducted pursuant to this section and must do so on an expedited basis.

(c) The provisions of this section shall not be available to a water utility subject to a finding of the Commission that the water utility is unable or unwilling to provide safe, adequate and reliable water service to its existing customers.

(d) The Commission may adopt rules and regulations, not inconsistent with this title, that the Commission finds reasonable or necessary to administer a DSIC.

73 Del. Laws, c. 138, §  2;  84 Del. Laws, c. 61, § 1; 

(a) The following definitions shall apply in this section:

(1) As used in this section, “DSIC costs” means depreciation expenses, and pretax return associated with eligible distribution system improvements.

(2) As used in this section, “DSIC rate” refers to a distribution system improvement charge.

(3) As used in this section, “DSIC revenues” means revenues produced through a DSIC exclusive of revenues from all other rates and charges.

(4) As used in this section, “eligible distribution system improvements” means new, used and useful electric or natural gas utility plant projects that:

a. Do not increase revenues by connecting the distribution system to new customers; and

b. Are in service; and

c. Were not included in the public utility’s rate base in its most recent general rate case filing; and which, in addition to meeting the 3 foregoing requirements, also satisfy at least 1 of the following criteria:

1. Replace or renew electric and natural gas distribution facilities serving existing customers that have reached their useful service life, are worn out, are in deteriorated condition, or which negatively impact the quality and reliability of service to the customer if not replaced or renewed; or

2. Extend or modify distribution facilities to eliminate conditions which negatively impact the quality and reliability of service to the customer; or

3. Relocate existing distribution facilities as a result of governmental actions that are not reimbursed, including but not limited to relocations of mains, lines and services, located in highway rights of way as required by the Department of Transportation; or

4. Place in service new or additional distribution facilities, plant or equipment required to meet changes in state or federal service quality standards, rules or regulations.

(5) As used in this section, “pretax return” means the revenues necessary to:

a. Produce net operating income equal to the public utility’s weighted cost of capital as established in the most recent general rate proceeding for the public utility multiplied by the net original cost of eligible distribution system improvements. At any time the Commission, by its own motion, or by motion of the utility, Commission staff or the Public Advocate, may determine to revisit and, after hearing without the necessity of a general rate filing, reset a utility’s cost of capital to reflect its current cost of capital. The DSIC rate shall be adjusted back to the date of the motion to reflect any change in the cost of capital determined by the Commission through this process;

b. Provide for the tax deductibility of the debt interest component of the weighted cost of capital; and

c. Pay state and federal income taxes applicable to such income.

(b) Notwithstanding other sections of this subchapter, a public utility providing electric and/or natural gas service may file with the Commission proposed rate schedules establishing a DSIC rate that will allow for the adjustment of the public utility’s basic rates and charges to provide recovery of DSIC costs on a semiannual basis.

(1) The public utility shall serve the Division of the Public Advocate’s office a copy of its filing at the time of its filing with the Commission. Customers not principally represented by the Public Advocate pursuant to § 8716(e)(2) of Title 29 and who inform the Commission in writing of their desire to be served shall also be served with a copy of the public utility filing at the time of its filing. All customers of the public utility shall be notified of changes in the DSIC rate by including appropriate information with the first bill they receive following any change in the rate.

(2) Publication of notice of the filing is not required.

(3) The effective date of changes in the DSIC rate shall be January 1 and July 1 every year. Proposed changes will become effective on those dates unless adjusted or rejected by the Commission for failure to comply with this section.

(4) The public utility shall file any request for a change in the DSIC rate and supporting data with the Commission at least 30 days prior to its effective date.

(5) The DSIC rate shall be adjusted semiannually for eligible distribution system improvements placed in service during the 6-month period ending 2 months prior to the effective date of changes in the DSIC rate.

(6) The DSIC rate shall be expressed as a percentage carried to 2 decimal places and applied to the total distribution base rate amount billed to each customer under the public utility’s otherwise applicable rates and charges established in the most recent general distribution rate case at the Commission.

(7) The DSIC rate applied between base rate filings shall be capped at 7.5% of the distribution base rate amount billed to customers under otherwise applicable rates and charges, but the DSIC rate increase applied shall not exceed 5% within any 12-month period.

(8) The DSIC Rate shall be subject to audit at intervals determined by the Commission. It will also be subject to annual reconciliation based on a period consisting of the 12 months ending December 31 of each year. The revenue received under the DSIC Rate for the reconciliation period shall be compared to the public utility’s eligible costs for that period with the difference between revenue received and eligible costs for the period recouped or refunded, as appropriate, over a 1-year period commencing July 1 of each year. If the DSIC Revenues exceeded the DSIC eligible costs, such over-collections shall be refunded with interest.

(9) The DSIC Rate shall be reset to zero as of the effective date of new base rates that provide for the prospective recovery of the annual costs theretofore recovered under the DSIC rate.

(10) The DSIC Rate shall also be reset to zero if, in any quarter, data filed with the Commission by the public utility show that the public utility will earn a rate of return that exceeds the rate of return established in its last general rate filing or by Commission order pursuant to paragraph (a)(5)a. of this section, if such was determined subsequent to the final order in the utility’s last general rate filing. Further, the DSIC rate shall be reinstated when such data show that the established rate of return is not exceeded and will not be exceeded if the DSIC rate is reinstated and reset.

(11) Any public utility filing for interim rate relief under this section must comply with all reasonable information requests related to its filing, or any other audits or proceedings conducted pursuant to this section and must do so on an expedited basis.

(c) The provisions of this section shall not be available to a public utility subject to a finding of the Commission that the public utility is unable or unwilling to provide safe, adequate and reliable service to its existing customers.

(d) The Commission may adopt rules and regulations, not inconsistent with this title, that the Commission finds reasonable or necessary to administer a DSIC. In the event an electric and/or natural gas utility applies for a DSIC before DSIC regulations specific to the particular utility are in place, then existing water DSIC regulations shall be applied to implement the utility’s DSIC without delay.

(e) In the event a DSIC rate is implemented under this section for any electric or natural gas utility serving over 100,000 customers in the State, such utility shall be precluded from filing an application with the Commission to increase its distribution base rates until January 1, 2020, at the earliest. In the event any electric or natural gas utility serving over 100,000 customers in the State files for an increase in its distribution base rates before January 1, 2020, such utility shall be precluded from filing for a DSIC rate.

(f) This section is not intended to preempt the Commission’s requirements under 26 DE Admin. Code 3007 with respect to annual reporting, annual planning or related stakeholder outreach.

(g) [Repealed.]

75 Del. Laws, c. 170, §  2;  81 Del. Laws, c. 268, § 1;  82 Del. Laws, c. 11, § 8;  83 Del. Laws, c. 37, § 27;  84 Del. Laws, c. 271, § 1; 

(a) The Commission shall ensure that all regulated utilities do not use customer funds to subsidize nonregulated activities.

(b) A public utility shall not recover the following costs from its customers, whether as part of proposed base rate costs, a rider, or other charges:

(1) Expenses for lobbying or other activities meant to influence the outcome of any local, state, or federal legislation, ordinance, resolution, or ballot measure.

(2) Organizational or membership dues, or other contributions, to any organization, association, institution, corporation, or other entity to the extent that the dues or contributions are used for lobbying or other similar activities intended to influence the outcome of any local, state, or federal legislation, ordinance, resolution, rule, ballot measure, or regulatory decision.

(3) Contributions to political candidates, campaign committees, issue committees, or independent expenditure committees or similar political expenses.

(4) Charitable giving expenses, including contributions to organizations qualified under § 501 (c)(3) or (c)(4) of the federal Internal Revenue Code of 1986, 26 U.S.C. § 501, as amended.

(5) Advertising and public relations expenses that do not directly relate to a purpose or program that is required or authorized under statute or commission rule or order.

a. Advertising and public relations expenses for which cost recovery is prohibited include:

1. Communications to promote or improve the utility’s brand.

2. Expenses for the purpose of influencing public opinion about the utility.

3. Expenses intended to create good will toward the utility from the general public.

b. For purposes of this section, “advertising” means the act of publishing, disseminating, soliciting, or circulating written, online, video, or audio communication intended to induce a person to patronize a product, service, business, or industry; promote a business’s brand; otherwise emphasize desirable qualities about a product, service, business, or industry; or influence public opinion with respect to legislative, administrative, or electoral matters.

c. “Advertising” does not include:

1. Advertising required or authorized by law, regulation, or order.

2. Advertising directly related to a purpose or program regarding income-based service, special rates, pilot programs, energy conservation, energy efficiency, beneficial electrification, renewable energy, transportation electrification, or other consumer education information.

3. Advertising regarding service interruptions, safety measures, or emergency conditions.

4. Advertising concerning employment opportunities with the utility.

(6) For any public utility with more than 25,000 customers, expenses related to distribution rate case proceedings for attorneys’ fees and fees to engage external expert witnesses or consultants incurred after the filing date that exceed the combined amount spent by commission staff and the Division of the Public Advocate on attorneys’ fees and fees to engage external expert witnesses or consultants.

85 Del. Laws, c. 79, § 1;  85 Del. Laws, c. 342, § 2; 

(a) Commission-regulated electric utilities must, within 180 days after finalization of the regulations under § 203G of this title, establish a classification of service for retail electricity consumers that are large energy use facilities. The classification of service must be separate and distinct from classifications of service for other commercial or industrial retail electricity consumers and have its own tariff schedule.

(b) All Commission-regulated electric utilities shall develop a load shed protocol to allow large energy use facilities to be curtailed in anticipation of or during emergency conditions, including the installation of any necessary equipment or technology before a customer is interconnected. This subsection applies only to a load interconnected after December 31, 2026.

(1) The load shed protocol, to the extent feasible and consistent with reliability and safety, shall do all of the following:

a. Require the pre-emergency curtailment of large energy use facilities subject to directives from the PJM Interconnection, L.L.C. (“PJM”) to the Commission-regulated electric utility in accordance with applicable PJM requirements.

b. Require the curtailment of noncritical large energy use facilities prior to the curtailment of other non-critical loads during a pre-emergency or emergency reliability event.

c. Require the curtailment of critical large energy use facilities prior to the curtailment of other critical loads during an emergency reliability event.

d. Include clear performance expectations and consequences for noncompliance.

e. Require a large energy use facility to inform potential customers that the facility is subject to curtailment under certain conditions and that, therefore, it may not be suitable for serving critical loads.

f. Exempt large energy facilities from the curtailment requirements of paragraphs (b)(1)b. through e. of this section if such large energy use facilities construct or cause the construction of new generation, where such new generation:

1. Is located within Delaware or within PJM’s Delmarva Power and Light (“DPL”) transmission zone or within a transmission zone contiguous by land to the DPL transmission zone, with sufficient existing transmission infrastructure to deliver this additional electricity to Delaware;

2. Has not previously participated in the PJM base residual auction;

3. Matches the megawatt demand of the large energy use facility; and

4. Is determined by the State Energy Office to be consistent the achievement of this State’s greenhouse gas emissions reductions targets, as specified in § 10003 of Title 7, and this State’s renewable portfolio standards, as specified in § 354 of this title.

(2) The load shed protocol must require that all large energy use facilities comply with all of the following, as a condition of interconnection:

a. Install the necessary equipment or technology to differentiate critical and noncritical loads, such as the use of dedicated or segregable feeders or allow the large energy use facility to certify that it is not hosting critical loads. Examples of critical load include essential health and public safety facilities, such as hospitals, police, military, fire facilities, 911 facilities, wastewater treatment facilities; facilities providing electric service to the bulk electric system, including off-site power to generating stations, substation light and power; critical gas infrastructure used to supply gas pipeline pumping plants, processing, and production facilities; and telecommunication facilities.

b. Maintain physical and operational readiness measures that facilitate both targeted curtailment of non-critical loads and whole facility curtailment.

c. Maintain telemetry and communications capability sufficient for the Commission-regulated electric utility to execute and confirm curtailment actions during pre-emergency or emergency operations.

(3) Prior to curtailment, the Commission-regulated electric utility shall confer with the customer to the extent feasible to shed load in a coordinated manner.

(c) For purposes of receiving distribution and transmission service, the tariff shall require each large energy use facility to enter into an electric service agreement ( “ESA” ) that is reviewed and approved by the Commission under the provisions of § 203G of this title. The tariff shall further require, as a condition of receiving retail electric service in this State, that a large energy use facility is subject to a transmission rate on file with the Federal Energy Regulatory Commission that, as to transmission costs, meets the objectives of this section. Commission-regulated electric utilities may not submit a tariff for approval until the Commission finalizes the regulations to establish the terms of an ESA under § 203G of this title. No large energy use facility may receive service from a Commission-regulated electric utility until such tariff schedule has been reviewed and approved by the Commission. The ESA may not restrict the procurement of electric supply service from a certified electric supplier.

(d) All ESAs submitted to the Commission for review and approval in connection with this classification of service must contain all protective provisions required under § 203G of this title.

(e) The ESAs and any tariff required by this section shall collectively:

(1) Directly assign the costs of providing to a large energy use facility the electric services identified in paragraphs (e)(1)a. through (e)(1)e. of this section that are provided under a rate subject to the jurisdiction of the Commission and ensure that no such costs are borne by any other class of customer, including:

a. Directly assign all costs related to distribution infrastructure investments required to interconnect a large energy use facility incurred by the Commission-regulated electric utility directly to the large energy use facility; any costs that cannot be directly assigned must be assigned to the class of customers for large energy use facilities and not to any other class of customers.

b. Directly assign all costs of electric capacity procurement incurred by the Commission-regulated electric utility on a total system basis as a result of electric capacity procurement requirements imposed by PJM Interconnection due to large energy use facilities; any costs that cannot be directly assigned must, to the maximum extent possible, be assigned to the class of customers for large energy use facilities and not to any other class of customers.

c. Directly assign all increased costs for transmission infrastructure resulting from any large energy use facility to the large energy use facility; any costs that cannot be directly assigned must be assigned to the class of customers for large energy use facilities and not to any other class of customers.

d. Directly assign all costs related to interconnection, impact, engineering, and related studies undertaken by the Commission-regulated electric utility to initiate, modify, or provide service to the large energy use facility; any costs that cannot be directly assigned must be assigned to the class of customers for large energy use facilities and not to any other class of customers.

e. Allocate any financial or other obligation assigned to a Delaware Commission-regulated electric utility associated with PJM’s reliability backstop procurement of new capacity undertaken for large energy use facilities directly to the large energy use facility that gave rise to the financial or other obligation; any costs that cannot be directly assigned must, to the maximum extent possible, be assigned to the class of customers for large energy use facilities and not to any other class of customers.

(2) Require that each large energy use facility seeking new or modified service shall, as a condition of taking service from a Delaware Commission-regulated electric utility, provide appropriate financial security to the electric utility to ensure that the Commission-regulated electric utility’s existing customers are held harmless for any of the costs in paragraphs (e)(1)a. through (e)(1)e. of this section for the entire term of the ESA. Such financial security such as bonding or letters of credit backed by an investment-grade entity, or other cash-equivalent financial guarantees, must remain in effect for the period necessary to ensure recovery of the full amount of such assigned investments.

(3) Require that the large energy use facility accept interruptible service for curtailment obligations assigned to the DPL zone by PJM, and establish a process that ensures that large energy users are curtailed in a manner prescribed by the Commission.

(4) Establish procedures for an incremental cost test ( “ICT” ) that will measure revenues from a large load customer and compare those to the incremental costs that serving that customer imposes on the system. Incremental costs to be studied shall include increases in capacity costs, locational marginal prices, transmission and distribution system infrastructure costs, including any differential in PJM network integration transmission service rates, and any other systems costs reasonably attributable to the large energy use facility. The ICT shall be performed by an independent consultant retained by the Commission on a 3-year cycle, or at such other time as the Commission determines is necessary to evaluate material changes in the customer’s load, operations, or system impacts, and the ESA will provide for adjustments to the service if the ICT reveals that the large load energy user is imposing costs upon other classes of service. Such independent consultant will perform an ICT to confirm that the revenues from a new large energy use facility are larger than the incremental costs associated with the customer. If the ICT shows that revenues are projected to be lower than incremental costs, then the Commission-regulated electric utility, in consultation with the large energy use facility, shall develop a proposal in the ESA to bring additional revenues such that incremental costs are paid for and a benefit is shown for system customers. ICT study costs incurred by the Commission-regulated electric utility, the Commission, including the independent consultant, and the Division of the Public Advocate must also be recovered through the ESA or other appropriate means. Such proposal may include, without limitation, a class- or customer-specific consumer protection and infrastructure fee designed to recover the incremental costs, infrastructure impacts, or cost shifts identified through the ICT. After recovery of costs incurred by the Commission-regulated electric utility, the Commission, and the Division of the Public Advocate, the Commission-regulated electric utility shall apply all such funds received as a direct bill credit to residential and small commercial customers to offset the impacts of large energy use facilities that cannot otherwise be addressed through a large load tariff. All costs related to ESA and ICT review shall be born by the class of large energy use facilities and may not be allocated to any other customer class.

(5) To the extent a large energy use facility procures electric supply service from a certified electric supplier, any costs allocated under this section that are associated with capacity, energy, or ancillary service obligations shall be structured in a manner compatible with the obligations of such supplier as the load-serving entity in regional wholesale markets, including PJM interconnection.

(f) In addition to an ESA, all large energy use facilities operating under the classification of service created by this section must as a condition of receiving retail electric service, have on file with the Federal Energy Regulatory Commission a transmission security agreement TSA that constains at least the following minimum terms:

(1) Financial security sufficient to ensure that the large load energy user can provide guarantees that its annual payments for transmission service will align with the annual payment that would be allocated to the large load energy user.

(2) Require bonding or letters of credit backed by an investment-grade entity, or other cash-equivalent financial guarantees, to ensure protection of other customers in the event of bankruptcy, liquidation, or other circumstances that would prevent the large energy use facility from meeting its obligations under the TSA.

(3) A 15-year contract period for the security that commences after load ramp.

(4) A load ramp period limited to 10 years.

(5) A 5-year period of advance notice of termination.

(6) A demand floor set at 90% of contract capacity.

(g) Both ESAs and TSAs must contain provisions that allow for amendments, if required by the Commission, to adjust to changes in the financial condition of the large energy use facility or guarantor changes, or market conditions change, over the term of the contract. The Commission and the Commission-regulated electric utility have the authority to require updated information to reevaluate the customer and its collateral requirements, which may be adjusted accordingly.

(h) ESAs must contain provisions that allow for amendments, if required by the Commission, to adjust to changes based on Federal Energy Regulatory Commission Orders or PJM governing documents, tariffs, or manual changes that relate to the operation of large energy use facilities. Commission-regulated electric utilities, if directed by the Commission, must seek or support any necessary Federal Energy Regulatory Commission filing to amend the TSA to address changes in the ESA. Any such amendment is subject to Federal Energy Regulatory Commission acceptance or approval.

(i) The Commission may require large energy use facilities to participate in a registry for the purpose of tracking load forecasting, compliance with bring your own new capacity or curtailment requirements, whether administered by PJM, the Commission-regulated electric utility, or a regulatory body.

(j) The following requirements apply to all large energy use facilities and must be reflected in any applicable tariff, which values may be increased by the Commission, to be applicable to future large energy use facilities:

(1) Large energy use facilities shall contribute to the low-income charge established under § 1014(b) of this title at a rate of $0.000190 per kWh.

(2) Large energy use facilities shall contribute to the Green Energy Fund established under § 1014(a) of this title at a rate of $0.000712 per kWh.

(3) Large energy use facilities are “end-use customers” for purposes of § 354 of this title and are not entitled to the exemption under § 353(b) of this title.

(4) The tariff must include a proportional allocation of the nonbypassable charge for funds distributed to a qualified fuel cell provider under § 364(b) of this title.

85 Del. Laws, c. 440, § 3;