The SMARTER Act would overhaul how smart grid investments are funded by electric utilities by amending the Public Utility Regulatory Policies Act of 1978 (PURPA). The bill adds a new standard that prohibits the recovery of any capital, operating, or other costs related to deploying a smart grid system from electric ratepayers. In effect, utilities could not include smart grid costs in customer rates. The act also requires state public utility regulators and, for nonregulated utilities, the utilities themselves to commence and complete a formal consideration of this standard within specified timeframes, with deadlines set at 1 year to begin and 2 years to finish. States that already have actions in motion or completed related to this standard are given a prior-action pathway to avoid retroactive application. The short title of the bill is the Stop Misappropriating Ratepayer Tariffs for Excessive Resources Act (SMARTER Act).
Key Points
- 1Prohibition on rate recovery for smart grid investments: Adds a new PURPA standard (111(d)(22)) stating that no electric utility may recover from ratepayers any costs related to deploying a smart grid system.
- 2Repeal and new standard alignment: Repeals PURPA section 111(d)(18)(B) and attaches the prohibition under a newly created paragraph (22) of section 111(d), establishing the formal rule and its enforcement pathway.
- 3Time-bound state actions: Requires state regulatory authorities (and nonregulated utilities) to begin consideration of the standard within 1 year of enactment and to complete consideration and make a determination within 2 years.
- 4Compliance mechanics and grandfathering: If a state has already implemented the standard (or a comparable standard), or has an ongoing proceeding or a legislative vote within the 3-year lookback window before enactment, the act provides pathways that may exempt or reduce retroactive impact under the “Prior State Actions” provision.
- 5Cross-references and timing alignment: Section 124 and related amendments adjust references to ensure the date of enactment for the new standard aligns across related provisions, including treatment of prior and pending proceedings.