Bill Text: VA HB2304 | 2021 | 1st Special Session | Engrossed
Bill Title: Phase I or Phase II electric utilities; provision of broadband capacity.
Spectrum: Moderate Partisan Bill (Democrat 4-1)
Status: (Passed) 2021-03-25 - Governor: Acts of Assembly Chapter text (CHAP0369) [HB2304 Detail]
Download: Virginia-2021-HB2304-Engrossed.html
Be it enacted by the General Assembly of Virginia:
1. That §56-585.1:9 of the Code of Virginia is amended and reenacted as follows:
§56-585.1:9. Provision of broadband capacity to unserved areas of the Commonwealth.
A. The Commission shall establish pilot programs under
which each Each Phase I Utility and each Phase II Utility, as such
terms are defined in subdivision A 1 of §56-585.1, may submit one or more
petitions to provide or make available broadband capacity to [ nongovernmental
] Internet service providers in areas of the Commonwealth unserved by
broadband. Any such petitions that a Phase I Utility submits shall not
exceed $60 million in costs annually. Any such petitions that a Phase II
Utility submits shall not exceed $60 million in costs annually. The
provision of such broadband capacity to [ nongovernmental ] Internet
service providers in areas of the Commonwealth unserved by broadband pursuant
to this section is in the public interest.
B. The incremental costs of providing broadband
capacity pursuant to any such pilot program petition, net
of revenue generated therefrom, shall be eligible for recovery from customers
as an electric grid transformation project pursuant to clause (vi) of
subdivision A 6 of §56-585.1 filed on or after July 1, 2020 2021, as
a non-bypassable charge. Notwithstanding any provision of subdivision A
6 or 7 of §56-585.1, the utility may file one or more petitions for approval
of such a rate adjustment clause, on a stand-alone basis, seeking recovery of
the costs of providing broadband capacity at any time on or after July 1, 2021,
and the Commission shall issue its final order regarding such petition within
three months following the date of filing.
C. Notwithstanding the provisions of §13.1-620 or the
articles of incorporation of an investor-owned utility, an investor-owned
utility may, either directly or through an affiliate or subsidiary, pursuant to
a pilot program petition that the Commissioner approves pursuant
to this section, (i) own, manage, or control any broadband capacity equipment
and electronics, including any plant, works, system, lines, facilities, or
properties, or any part or parts thereof, together with all appurtenances
thereto, used or useful in connection with the provision and extension of such
broadband services; (ii) lease indefeasible rights of use in such broadband
capacity equipment and electronics to [ nongovernmental ] Internet
service providers in areas of the Commonwealth unserved by broadband pursuant
to this section; and (iii) provide access points that are outside the utility's
energized zone to allow connection between the utility's broadband capacity
system and the [ nongovernmental ] Internet service provider's system.
D. Each petition to provide broadband capacity pursuant to
this section that an investor-owned utility submits to the Commission shall
identify the [ nongovernmental ] Internet service provider to which the
utility shall lease such capacity, together with the area to be served using
such capacity. The Commission shall, after notice and opportunity for hearing,
initiate proceedings to review each petition submitted. In determining
whether an area is unserved by broadband, the Commission shall take into
account the impact of any grants or loans made to provide broadband access to
the designated area. The Commission's final order regarding any such petition
shall be entered by the Commission not more than six months after the date of
the filing of such petition. The Commission shall condition any approval of
such petition on the requirement that construction shall commence within three
years of such approval. If the utility fails to commence construction within
such period, the utility may resubmit the petition for Commission approval
An area shall be conclusively determined to be unserved by broadband if (i) the
Department of Housing and Community Development certifies that the designated
area is unserved; (ii) the Virginia Telecommunication Initiative has issued a
grant or loan to service the designated area; (iii) the federal government has
issued a grant or a loan, or has provided support, to service the designated
area; or (iv) the federal government or the Commonwealth has designated the
area as unserved. The determination of the Department of Housing and Community
Development, the Virginia Telecommunication Initiative, or the federal
government shall be sufficient for the Commission to find the area to be
unserved. In addition, the Commission may determine that an area is unserved on
the basis of other competent evidence.
E. An investor-owned utility shall be responsible to obtain
all necessary rights-of-way or other easements or real property rights to
permit leasing of broadband capacity to [ nongovernmental ] Internet
service providers. A [ nongovernmental ] Internet service provider shall
be responsible to obtain all necessary rights-of-way or other easements or real
property rights from utility access point to permit the provision of broadband
services to end-user customers.
F. As used in this section:
"Broadband" means Internet access at speeds equal
to or greater than 10 MBps download speed and one MBps upload speed,
provided that the adequate speed as determined by the broadband
guidelines set out by the Department of Housing and Community Development
for its Virginia Telecommunication Initiative may by guideline modify such
speeds from time to time.
"Unserved by broadband" means a designated area in which less than 10 percent of residential and commercial units are capable of receiving broadband service, provided that the Department of Housing and Community Development for its Virginia Telecommunication Initiative may by guideline increase such percentage from time to time.
G. No investor-owned utility nor any affiliate thereof may
offer broadband or Internet service provider services to residential or
commercial end-user customers in the Commonwealth pursuant to this section.
Nothing in this section shall be construed to prevent an investor-owned utility
or an affiliate thereof from providing transport of or capacity for broadband
or Internet service in the Commonwealth as a wholesaler or intermediate
vendor, provided that an unaffiliated [ nongovernmental ] third party is
the provider of broadband or Internet services to the end-user customer.
H. The provision and extension of broadband capacity by an
incumbent electric utility to an area of the Commonwealth unserved by broadband
pursuant to a pilot program petition that the Commission approves
pursuant to this section, including any business activity related to the
construction or leasing of broadband capacity facilities, shall be exempt from
any rules and regulations that the Commission has promulgated or may promulgate
governing functional separation of generation, retail transmission, and distribution
of incumbent electric utilities. Investor-owned electric utilities may for the
purposes of this section engage in such coordination between and among their
various corporate divisions as necessary for the purposes of providing
broadband capacity to an area of the Commonwealth unserved by broadband.
I. The pilot program established pursuant to this section
shall continue for the three-year period ending three years following the date
the Commission approves the first petition to provide broadband capacity
pursuant to this section, unless the Commission extends the pilot program or
makes the pilot program permanent. At the termination of the pilot program, a
utility shall continue to provide broadband capacity pursuant to leases
existing as of the date of such termination.
J. Notwithstanding the provisions of §13.1-620 or the
articles of incorporation of an investor-owned utility, an investor-owned
utility may, either directly or through an affiliate or subsidiary, lease
broadband-related assets or capacity to any third party [ that is a
wholesaler and that is not a government-owned broadband authority ] ,
for the purposes of providing broadband connectivity. The leases may, if the
parties choose, extend in length beyond the end of the pilot program, notwithstanding
any Commission order issued pursuant to subsection I terminating the pilot
program. The revenues generated from such leases shall offset (i) the
incremental costs of the pilot program petition recovered
through the rate adjustment clause described in subsection B or (ii) the
utility's electric cost of service.
2. That any pilot program established by Phase I or Phase II utility prior to July 1, 2021, under §56-585.1:9 of the Code of Virginia prior to the enactment of this act may continue, and the utility may maintain such pilot program at its discretion, under the terms originally established. Upon the expiration of such pilot program, the utility may seek to renew or extend such program pursuant to the terms of this act.