PROPOSED BY VIRGINIA MUNICIPAL LEAGUE

(Patterned after the Massachusetts Electric Utility
Restructuring Act pertaining to municipal aggregation)

§56-587(__)

Local government load aggregation programs:

(1) Any city, county or town ("local government") or any group thereof acting together within the Commonwealth is hereby authorized to aggregate the electrical load of interested electricity consumers within its boundaries; provided, however, that such local government or group thereof shall not aggregate electrical load if such are served by an existing municipal electric distribution system. Such local government or group thereof may group its electricity requirements for governmental purposes with such retail electricity customers to solicit bids, broker, and contract for electric power and energy services for such customers. Such local government or group thereof may enter into agreements for services to facilitate the sale and purchase of electric energy and other related services. Such service agreements may be entered into one or more such local governments.

A local government or group thereof which aggregates its electrical load and operates pursuant to the provisions of this section shall not be considered a utility engaging in the wholesale purchase and resale of electric power. Providing electric power or energy services to aggregated customers within a local government or group thereof shall not be considered a wholesale utility transaction. The provision of aggregated electric power and energy services as authorized by this section shall be regulated by any laws or regulations which are applicable to aggregated electric power and energy services in competitive markets.

A local government may initiate a process to aggregate electrical load upon authorization by a majority vote of its governing body. Two or more local governments may as a group initiate a process jointly to authorize aggregation by such majority vote of each particular local government as herein required.

Upon an affirmative vote to initiate said process, a local government or group thereof establishing load aggregation pursuant to this section shall, in consultation with the State Corporation Commission (the "Commission") develop a plan, for review by its citizens, detailing the process. Such plan shall provide for universal access, reliability, and equitable treatment of all classes of customers and shall meet any requirements established by law or the Commission concerning aggregated service. Said plan shall be filed with the Commission, for its final review and approval, and shall include, without limitation, an organizational structure of the program, its operations, and its funding; rate setting and other costs to participants; the methods for entering and terminating agreements with other entities; the rights and responsibilities of program participants; and termination of the program. The plan shall not be implemented until the Commission has approved a contract for the supply of such aggregated electrical load, which approval shall include consideration of both price and non-price terms and elements that affect the environment and other policy issues in the public interest.

Participation by any retail customer in a local government aggregation program shall be voluntary. If such aggregated entity is not fully operational on the retail access date as established by law, any consumer to be automatically enrolled therein shall receive standard offer service from the incumbent electricity supplier (the "standard offer service") unless affirmatively electing not to do so. Within 30 days of the date the aggregated entity is fully operational, such consumers shall be transferred to the aggregated entity unless electing in writing not to do so; provided, however, once enrolled in the aggregated entity, any consumer choosing to opt-out may do so in accordance with the Plan, without penalty and shall be entitled to receive standard offer service as if originally enrolled therein. Nothing in this section shall be construed as authorizing any local government retail load aggregator to restrict the ability of retail electric customers to obtain or receive service from any authorized provider thereof.

(2) Any local government, political subdivision, authority, school division or agency thereof, is authorized to aggregate the electricity requirements and service for all governmental uses of such entity with such electricity requirements of one or more other such entities; to solicit bids and to contract jointly for the supply of such electricity and services including, either singly or in combination, the generation, transmission and distribution thereof.