278.672 Application for financing order for deferred costs -- Requirements --
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/ky/278-672A research copy — for the controlling text, always check the official state or federal source. Not legal advice.
Deadline.
(1)An electric utility may apply to the commission for a financing order to finance
extraordinary or other deferred costs from previous events for regulatory assets
existing and with a value calculated on June 30, 2023, as:
(a)Greater than two hundred million dollars ($200,000,000) for a single
regulatory asset; or
(b)Having a cumulative total value of greater than two hundred and seventy-five
million ($275,000,000) for multiple regulatory assets.
(2)An application for a financing order shall include:
(a)A description of the deferred costs the utility is seeking to securitize. If more
than fifty percent (50%) of the deferred costs are retired generation costs, the
application also shall describe:
1. The electric generating facility or facilities that have been retired; and
2. A copy of all previous commission orders related to the deferral of costs
applicable to the retirement or abandonment of the facility or facilities;
(b)The dollar amount of the deferred costs;
(c)A statement of whether the electric utility proposes to finance all or a portion
of deferred costs using securitized bonds. If the electric utility proposes to
finance a portion of the costs, the electric utility shall identify the specific
portion of the deferred costs in the application. By electing not to finance all
or any portion of deferred costs using securitized bonds, an electric utility
shall not be deemed to waive its right to reflect those costs in its retail rates
pursuant to a separate proceeding with the commission. However, at no point
shall the electric utility apply to securitize less than the amounts prescribed in
subsection
(1)of this section;
(d)An estimate of the financing costs related to the securitized bonds;
(e)An estimate of the securitized surcharges necessary to recover the securitized
costs and financing costs and the period for recovery of the costs;
(f)A comparison between the net present value of the costs to ratepayers that are
estimated to result from the issuance of securitized bonds and the cost that
would result from an alternative means of providing for the full recovery of
and return on those securitized costs from customers, using the utility's
current or expected weighted average cost of capital. The comparison should
demonstrate that the issuance of securitized bonds and the imposition of
securitized surcharges are expected to provide quantifiable net present value
benefits to customers;
(g)A proposed future ratemaking process to reconcile any differences between
securitized costs financed by securitized bonds and the final securitized costs
incurred by the electric utility, successor, or assignee, provided that any
reconciliation shall not affect the amount of securitized bonds or the
associated securitized surcharges paid by customers; and
(h)Testimony supporting the application.
(3)The commission shall not accept for filing an application tendered pursuant to this
section after December 31, 2024.