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UNOFFICIAL COPY 26 RS SJR 134/GA
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A JOINT RESOLUTION regarding utility fuel adjustment clauses under the 1
jurisdiction of the Public Service Commission and declaring an emergency. 2
WHEREAS, electric utility bills have risen and are forecast to rise significantly; 3
and 4
WHEREAS, one of the reasons for the precipitous increase is the cost of fuel 5
feedstocks, particularly natural gas, which utilities use to power their electric generators ; 6
and 7
WHEREAS, utilities can pass through fuel costs to the ratepayer on a one -to-one 8
basis through the use of a surcharge on the utility bill called the fuel adjustment charge 9
(FAC); and 10
WHEREAS, household incomes oftentimes cannot respond automatically t o the 11
variances in the amounts passed through to customers because, unlike the utility, 12
households normally do not have sufficient savings to cover those unanticipated, 13
extraordinary increases; and 14
WHEREAS, as a result, Kentucky ratepayers are at risk of h aving their service 15
disconnected by the utility, compromising the health, safety, and financial security of the 16
household; and 17
WHEREAS, most utilities in Kentucky can disconnect a customer after ten days' 18
notice to a customer for nonpayment, and shut -offs can occur in winter or summer with 19
little regard to how cold or hot the temperature is outside; and 20
WHEREAS, in 2025, Kentucky's median household income was approximately 21
$60,000, but eligibility for the one comprehensive statewide program which assists 22
residents with their utility bills requires a household to be at 150 percent of the federal 23
poverty level; and 24
WHEREAS, for a family of three, the poverty guidelines require the family to earn 25
no more than $39,978 and have little cash reserve; and 26
WHEREAS, there are few other programs available to help Kentuckians with 27
UNOFFICIAL COPY 26 RS SJR 134/GA
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paying utility bills or reconnecting service a fter it has been terminated, and most of those 1
programs are not designed to assist the working, middle -income families whose bills 2
have escalated far above their household budget constraints; and 3
WHEREAS, many of these households have elderly persons, chil dren, or 4
individuals with medical or health -related needs that place them at increased risk for 5
illness or death; 6
NOW, THEREFORE, 7
Be it resolved by the General Assembly of the Commonwealth of Kentucky: 8
Section 1. The Public Service Commission shall, not later than May 15, 2026, 9
in a new or open administrative case, review the current FAC administrative regulation 10
with the goal of reducing the month -to-month volatility of the FAC surcharge on 11
customers' bills. The commission shall set forth a procedural schedule for the public and 12
affected utilities to comment on the proposed FAC changes. The commission shall 13
consider timely comments in determining whether and what changes should be made to 14
the FAC, and at the en d of the case, the commission shall amend the administrative 15
regulation accordingly. The amended FAC administrative regulation shall be 16
promulgated not later than August 15, 2026. 17
Section 2. The Public Service Commission shall issue a report to the Legislative 18
Research Commission by December 15, 2026, that includes: 19
(1) A copy of the newly amended FAC administrative regulation; 20
(2) An explanation of how the amended FAC differs from the previous 21
administrative regulation; 22
(3) A summary of the comments made in response to the draft FAC 23
administrative regulation; and 24
(4) How the new FAC administrative regulation is expected to reduce month -to-25
month FAC surcharge volatility. 26
Section 3. Where as the dramatic increase in the cost of fuel for producing 27
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electricity and the expected constraints on energy supply during the summer cooling 1
season will make the cost of electricity unaffordable for many Kentuckians, leading to 2
increased disconnections, an emergency is declared to exist, and this Act takes effect 3
upon its passage and approval by the Governor or upon its otherwise becoming a law. 4