Senate Bill 966 Printer's Number 1106

PENNSYLVANIA, August 13 - * * *

(3.1) The commission shall require, by order or

regulation to be issued within 210 days of the effective date

of this paragraph, that each natural gas distribution company

shall account for any and all costs, including, but not

limited to: commodity costs, capacity costs, hedging costs

whether financial or physical, procurement costs, billing

system and billing costs, customer service and account

management costs, working capital, office building, rent and

information technology costs, legal and financial costs and

labor costs. To the extent any of these costs pay for

services that support both distribution customers and

supplier of last resort customers, the commission shall

require an appropriate proportion of those costs be allocated

to the supplier of last resort. In a case where costs are

apportioned to both distribution customers and supplier of

last resort customers, the apportionment shall be at actual

costs. For the purpose of this paragraph, the provision of

supplier of last resort service shall be treated as an

affiliate of the natural gas distribution company. The intent

of this requirement is to ensure that the actual costs of

providing distribution and supplier of last resort service

are accurately reflected in the rates charged for those

services. The commission shall adopt rate mechanisms to

ensure that the natural gas distribution companies recover

fully their allowed distribution costs. The unbundling and

reallocation shall be accomplished in the supplier of last

resort's next rate case. If a natural gas distribution

company does not file a rate case within three years

following the effective date of this paragraph, the

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