§ 62-159. Additional funding for natural gas expansion. - North Carolina Statutes

§ 62‑159. Additional funding for natural gas expansion.

(a)        In order to facilitate the construction of facilities in andthe extension of natural gas service to unserved areas, the Commission mayprovide funding through appropriations from the General Assembly or theproceeds of general obligation bonds as provided in this section to either (i)an existing natural gas local distribution company; (ii) a person awarded a newfranchise; or (iii) a gas district for the construction of natural gasfacilities that it otherwise would not be economically feasible for thecompany, person, or gas district to construct.

(b)        The use of funds provided under this section shall bepursuant to an order of the Commission after a public hearing. The Commissionshall ensure that all projects for which funds are provided under this sectionare consistent with the intent of this section and G.S. 62‑2(9). Indetermining whether to approve the use of funds for a particular projectpursuant to this section, the Commission shall consider the scope of a proposedproject, including the number of unserved counties and the number ofanticipated customers that would be served, the total cost of the project, theextent to which the project is considered feasible, and other relevant factorsaffecting the public interest. In determining economic feasibility, theCommission shall employ the net present value method of analysis on a projectspecific basis. Only those projects with a negative net present value shall bedetermined to be economically infeasible for the company, person, or gasdistrict to construct. In no event shall the Commission provide funding underthis section of an amount greater than the negative net present value of anyproposed project as determined by the Commission. If at any time a project isdetermined by the Commission to have become economically feasible, theCommission shall require the recipient of funding to remit to the Commissionappropriate funds related to the project, and the Commission may order thosefunds to be returned with interest in a reasonable amount to be determined bythe Commission. Funds returned, together with interest, shall be deposited withthe State Treasurer to be used for other expansion projects pursuant to theprovisions of this section. Utility plant acquired with expansion funds shallbe included in the local distribution company's rate base at zero cost exceptto the extent such funds have been remitted by the company pursuant to order ofthe Commission. In the event a gas district wishes to sell or otherwise disposeof facilities financed with funds received under this section, it must firstnotify the Commission which shall determine the method of repayment oraccounting for those funds.

(c)        To the extent that one or more of the counties included in aproposed project to be funded pursuant to this section are counties affected bythe loss of exclusive franchise rights provided for in G.S. 62‑36A(b),the Commission may conclude that the public interest requires that the personobtaining the franchise or funding pursuant to this section be given anexclusive franchise and that the existing franchise be canceled. Any newexclusive franchise granted under this subsection shall be subject to theprovisions of G.S. 62‑36A(b). This subsection does not apply to gasdistricts formed under Article 28 of Chapter 160A of the General Statutes.

(d)        The Commission, after hearing, shall adopt rules toimplement this section as soon as practicable. The Commission and Public Staffshall report to the Joint Legislative Utility Review Committee on the use offunding provided under this section in conjunction with the reports requiredunder G.S. 62‑36A. (1998‑132, s. 17; 1999‑456, s. 17.)