{"formats":[{"name":"JSON","format":"json","url":"\/downloads\/2025\/code-json\/56-590.json"},{"name":"Plain Text","format":"text","url":"\/downloads\/2025\/code-text\/56-590.txt"},{"name":"XML","format":"xml","url":"\/downloads\/2025\/code-xml\/56-590.xml"},{"name":"HTML","format":"html","url":"\/downloads\/2025\/code-html\/56-590.html"}],"law_id":86105,"edition_id":1,"section_id":86105,"structure_id":13084,"section_number":"56-590","catch_line":"Divestiture, functional separation and other corporate relationships","history":"1999, c. 411; 2000, c. 991; 2001, c. 748; 2007, cc. 888, 933.","full_text":"A\n\nThe Commission shall not require any incumbent electric utility to divest itself of any generation, transmission or distribution assets pursuant to any provision of this chapter.B\n\n1. The Commission shall, however, direct the functional separation of generation, retail transmission and distribution of all incumbent electric utilities in connection with the provisions of this chapter to be completed by January 1, 2002.2\n\nBy January 1, 2001, each incumbent electric utility shall submit to the Commission a plan for such functional separation which may be accomplished through the creation of affiliates, or through such other means as may be acceptable to the Commission.3\n\nConsistent with this chapter, the Commission may impose conditions, as the public interest requires, upon its approval of any incumbent electric utility’s plan for functional separation, including requirements that (i) the incumbent electric utility’s generation assets or, at the election of the incumbent electric utility and if approved by the Commission pursuant to subdivision 4 of this subsection, their equivalent are made available for electric service during the capped rate period as provided in § 56-582 and, if applicable, during any period the distributor serves as a default provider as provided for in § 56-585; (ii) the incumbent electric utility receive Commission approval for the sale, transfer or other disposition of generation assets during the capped rate period and, if applicable, during any period the distributor serves as a default provider; and (iii) any such generation asset sold, transferred, or otherwise disposed of by the incumbent electric utility with Commission approval shall not be further sold, transferred, or otherwise disposed of during the capped rate period and, if applicable, during any period the distributor serves as default provider, without additional Commission approval.4\n\nIf an incumbent electric utility proposes that the equivalent to its generation assets be made available pursuant to subdivision 3 of this subsection, the Commission shall determine the adequacy of such proposal and shall approve or reject such proposal based on the public interest.5\n\nIn exercising its authority under the provisions of this section and under § 56-90, the Commission shall have no authority to regulate, on a cost-of-service basis or other basis, the price at which generation assets or their equivalent are made available for default service purposes. Such restriction on the Commission’s authority to regulate, on a cost-of-service basis or other basis, prices for default service shall not affect the ability of a distributor to offer to provide, and of the Commission to approve if appropriate the provision of, such services on a cost plus basis or any other basis. The Commission’s authority to regulate the price of default service shall be consistent with the pricing provisions applicable to a distributor pursuant to § 56-585. In addition, the Commission shall, in exercising its responsibilities under this section and under § 56-90, consider, among other factors, the potential effects of any such transfer on: (i) rates and reliability of capped rate service under § 56-582, and of default service under § 56-585, and (ii) the development of a competitive market in the Commonwealth for retail generation services. However, the Commission may not deny approval of a transfer proposed by an incumbent electric utility, pursuant to subdivisions 2 and 4 of this subsection, due to an inability to determine, at the time of consideration of the transfer, default service prices under § 56-585.C\n\nThe Commission shall, to the extent necessary to promote effective competition in the Commonwealth, promulgate rules and regulations to carry out the provisions of this section, which rules and regulations shall include provisions:1\n\nProhibiting cost-shifting or cross-subsidies between functionally separate units;2\n\nProhibiting functionally separate units from engaging in anticompetitive behavior or self-dealing;3\n\nProhibiting affiliated entities from engaging in discriminatory behavior towards nonaffiliated units; and4\n\nEstablishing codes of conduct detailing permissible relations between functionally separate units.D\n\nNeither a covered entity nor an affiliate thereof may be a party to a covered transaction without the prior approval of the Commission. Any such person proposing to be a party to such transaction shall file an application with the Commission. The Commission shall approve or disapprove such transaction within sixty days after the filing of a completed application; however, the sixty-day period may be extended by Commission order for a period not to exceed an additional 120 days. The application shall be deemed approved if the Commission fails to act within such initial or extended period. The Commission shall approve such application if it finds, after notice and opportunity for hearing, that the transaction will comply with the requirements of subsection E, and may, as a part of its approval, establish such conditions or limitations on such transaction as it finds necessary to ensure compliance with subsection E.E\n\nA transaction described in subsection D shall not:1\n\nSubstantially lessen competition among the actual or prospective providers of noncompetitive electric service or of a service which is, or is likely to become, a competitive electric service; or2\n\nJeopardize or impair the safety or reliability of electric service in the Commonwealth, or the provision of any noncompetitive electric service at just and reasonable rates.F\n\nExcept as provided in subdivision B 5, nothing in this chapter shall be deemed to abrogate or modify the Commission’s authority under Chapter 3 (§ 56-55 et seq.), 4 (§ 56-76 et seq.) or 5 (§ 56-88 et seq.) of this title. However, any person subject to the requirements of subsection D that is also subject to the requirements of Chapter 5 of this title may be exempted from compliance with the requirements of Chapter 5 of this title.","order_by":null,"text":{"0":{"id":308339,"text":"The Commission shall not require any incumbent electric utility to divest itself of any generation, transmission or distribution assets pursuant to any provision of this chapter.","type":"section","prefixes":["A"],"prefix":"A","entire_prefix":"A","prefix_anchor":"A","level":1,"next_prefix":"B"},"1":{"id":308340,"text":"1. The Commission shall, however, direct the functional separation of generation, retail transmission and distribution of all incumbent electric utilities in connection with the provisions of this chapter to be completed by January 1, 2002.","type":"section","prefixes":["B"],"prefix":"B","entire_prefix":"B","prefix_anchor":"B","level":1,"prior_prefix":"A","next_prefix":"B2"},"2":{"id":308341,"text":"By January 1, 2001, each incumbent electric utility shall submit to the Commission a plan for such functional separation which may be accomplished through the creation of affiliates, or through such other means as may be acceptable to the Commission.","type":"section","prefixes":["B","2"],"prefix":"2","entire_prefix":"B2","prefix_anchor":"B2","level":2,"prior_prefix":"B","next_prefix":"B3"},"3":{"id":308342,"text":"Consistent with this chapter, the Commission may impose conditions, as the public interest requires, upon its approval of any incumbent electric utility’s plan for functional separation, including requirements that (i) the incumbent electric utility’s generation assets or, at the election of the incumbent electric utility and if approved by the Commission pursuant to subdivision 4 of this subsection, their equivalent are made available for electric service during the capped rate period as provided in § 56-582 and, if applicable, during any period the distributor serves as a default provider as provided for in § 56-585; (ii) the incumbent electric utility receive Commission approval for the sale, transfer or other disposition of generation assets during the capped rate period and, if applicable, during any period the distributor serves as a default provider; and (iii) any such generation asset sold, transferred, or otherwise disposed of by the incumbent electric utility with Commission approval shall not be further sold, transferred, or otherwise disposed of during the capped rate period and, if applicable, during any period the distributor serves as default provider, without additional Commission approval.","type":"section","prefixes":["B","3"],"prefix":"3","entire_prefix":"B3","prefix_anchor":"B3","level":2,"prior_prefix":"B2","next_prefix":"B4"},"4":{"id":308343,"text":"If an incumbent electric utility proposes that the equivalent to its generation assets be made available pursuant to subdivision 3 of this subsection, the Commission shall determine the adequacy of such proposal and shall approve or reject such proposal based on the public interest.","type":"section","prefixes":["B","4"],"prefix":"4","entire_prefix":"B4","prefix_anchor":"B4","level":2,"prior_prefix":"B3","next_prefix":"B5"},"5":{"id":308344,"text":"In exercising its authority under the provisions of this section and under § 56-90, the Commission shall have no authority to regulate, on a cost-of-service basis or other basis, the price at which generation assets or their equivalent are made available for default service purposes. Such restriction on the Commission’s authority to regulate, on a cost-of-service basis or other basis, prices for default service shall not affect the ability of a distributor to offer to provide, and of the Commission to approve if appropriate the provision of, such services on a cost plus basis or any other basis. The Commission’s authority to regulate the price of default service shall be consistent with the pricing provisions applicable to a distributor pursuant to § 56-585. In addition, the Commission shall, in exercising its responsibilities under this section and under § 56-90, consider, among other factors, the potential effects of any such transfer on: (i) rates and reliability of capped rate service under § 56-582, and of default service under § 56-585, and (ii) the development of a competitive market in the Commonwealth for retail generation services. However, the Commission may not deny approval of a transfer proposed by an incumbent electric utility, pursuant to subdivisions 2 and 4 of this subsection, due to an inability to determine, at the time of consideration of the transfer, default service prices under § 56-585.","type":"section","prefixes":["B","5"],"prefix":"5","entire_prefix":"B5","prefix_anchor":"B5","level":2,"prior_prefix":"B4","next_prefix":"C"},"6":{"id":308345,"text":"The Commission shall, to the extent necessary to promote effective competition in the Commonwealth, promulgate rules and regulations to carry out the provisions of this section, which rules and regulations shall include provisions:","type":"section","prefixes":["C"],"prefix":"C","entire_prefix":"C","prefix_anchor":"C","level":1,"prior_prefix":"B5","next_prefix":"C1"},"7":{"id":308346,"text":"Prohibiting cost-shifting or cross-subsidies between functionally separate units;","type":"section","prefixes":["C","1"],"prefix":"1","entire_prefix":"C1","prefix_anchor":"C1","level":2,"prior_prefix":"C","next_prefix":"C2"},"8":{"id":308347,"text":"Prohibiting functionally separate units from engaging in anticompetitive behavior or self-dealing;","type":"section","prefixes":["C","2"],"prefix":"2","entire_prefix":"C2","prefix_anchor":"C2","level":2,"prior_prefix":"C1","next_prefix":"C3"},"9":{"id":308348,"text":"Prohibiting affiliated entities from engaging in discriminatory behavior towards nonaffiliated units; and","type":"section","prefixes":["C","3"],"prefix":"3","entire_prefix":"C3","prefix_anchor":"C3","level":2,"prior_prefix":"C2","next_prefix":"C4"},"10":{"id":308349,"text":"Establishing codes of conduct detailing permissible relations between functionally separate units.","type":"section","prefixes":["C","4"],"prefix":"4","entire_prefix":"C4","prefix_anchor":"C4","level":2,"prior_prefix":"C3","next_prefix":"D"},"11":{"id":308350,"text":"Neither a covered entity nor an affiliate thereof may be a party to a covered transaction without the prior approval of the Commission. Any such person proposing to be a party to such transaction shall file an application with the Commission. The Commission shall approve or disapprove such transaction within sixty days after the filing of a completed application; however, the sixty-day period may be extended by Commission order for a period not to exceed an additional 120 days. The application shall be deemed approved if the Commission fails to act within such initial or extended period. The Commission shall approve such application if it finds, after notice and opportunity for hearing, that the transaction will comply with the requirements of subsection E, and may, as a part of its approval, establish such conditions or limitations on such transaction as it finds necessary to ensure compliance with subsection E.","type":"section","prefixes":["D"],"prefix":"D","entire_prefix":"D","prefix_anchor":"D","level":1,"prior_prefix":"C4","next_prefix":"E"},"12":{"id":308351,"text":"A transaction described in subsection D shall not:","type":"section","prefixes":["E"],"prefix":"E","entire_prefix":"E","prefix_anchor":"E","level":1,"prior_prefix":"D","next_prefix":"E1"},"13":{"id":308352,"text":"Substantially lessen competition among the actual or prospective providers of noncompetitive electric service or of a service which is, or is likely to become, a competitive electric service; or","type":"section","prefixes":["E","1"],"prefix":"1","entire_prefix":"E1","prefix_anchor":"E1","level":2,"prior_prefix":"E","next_prefix":"E2"},"14":{"id":308353,"text":"Jeopardize or impair the safety or reliability of electric service in the Commonwealth, or the provision of any noncompetitive electric service at just and reasonable rates.","type":"section","prefixes":["E","2"],"prefix":"2","entire_prefix":"E2","prefix_anchor":"E2","level":2,"prior_prefix":"E1","next_prefix":"F"},"15":{"id":308354,"text":"Except as provided in subdivision B 5, nothing in this chapter shall be deemed to abrogate or modify the Commission’s authority under Chapter 3 (§ 56-55 et seq.), 4 (§ 56-76 et seq.) or 5 (§ 56-88 et seq.) of this title. However, any person subject to the requirements of subsection D that is also subject to the requirements of Chapter 5 of this title may be exempted from compliance with the requirements of Chapter 5 of this title.","type":"section","prefixes":["F"],"prefix":"F","entire_prefix":"F","prefix_anchor":"F","level":1,"prior_prefix":"E2"}},"ancestry":[{"id":13084,"edition_id":1,"name":"Virginia Electric Utility Regulation Act","identifier":"23","label":"chapter","depth":2,"order_by":1,"parent_id":12881,"metadata":{},"date_created":"2026-06-26 03:44:15","date_modified":"2026-06-26 03:44:15","permalink":{"id":250597,"object_type":"structure","relational_id":13084,"identifier":"23","token":"56\/23","url":"\/56\/23\/","edition_id":1,"permalink":0,"preferred":1}},{"id":12881,"edition_id":1,"name":"Public Service Companies","identifier":"56","label":"title","depth":1,"order_by":1,"parent_id":null,"metadata":{},"date_created":"2026-06-26 03:43:58","date_modified":"2026-06-26 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facilities","url":"\/56-589.1\/","token":"56\/23\/56-589.1","metadata":false},"next_section":{"id":67461,"structure_id":13084,"section_number":"56-591","catch_line":"Application of antitrust laws","url":"\/56-591\/","token":"56\/23\/56-591","metadata":false},"metadata":false,"official_url":"https:\/\/law.lis.virginia.gov\/vacode\/56-590\/","history_text":"

This law was first created in 1999. The record of its establishment is cataloged in chapter 411<\/a> of that year\u2019s edition of \u201cActs of Assembly,\u201d the annual state publication listing all changes made to the Code of Virginia in that year. It has been modified 3 times. Those modifications are cataloged by \u201cThe Acts of Assembly,\u201d a state publication, by year and chapter. Those modifications that can be read on the General Assembly\u2019s website will be linked accordingly. Those modifications are as follows: in 2000, chapter 991<\/a>; in 2001, chapter 748<\/a>; in 2007, chapters 888<\/a> and 933<\/a>.<\/p>","references":[{"id":81307,"section_number":"56-231.24","catch_line":"Power to dispose of property","order_by":null,"url":"\/56-231.24\/"},{"id":75586,"section_number":"56-582","catch_line":"Rate caps","order_by":null,"url":"\/56-582\/"}],"refers_to":[{"id":63393,"section_number":"56-55","catch_line":"Definitions","order_by":null,"url":"\/56-55\/"},{"id":75586,"section_number":"56-582","catch_line":"Rate caps","order_by":null,"url":"\/56-582\/"},{"id":66252,"section_number":"56-585","catch_line":"Default service","order_by":null,"url":"\/56-585\/"},{"id":58706,"section_number":"56-76","catch_line":"Definitions","order_by":null,"url":"\/56-76\/"},{"id":79652,"section_number":"56-88","catch_line":"Definitions","order_by":null,"url":"\/56-88\/"},{"id":66580,"section_number":"56-90","catch_line":"Procedure for authority to acquire or dispose of utility assets or securities","order_by":null,"url":"\/56-90\/"}],"permalink":{"id":250767,"object_type":"law","relational_id":86105,"identifier":"56-590","token":"56\/23\/56-590","url":"\/56-590\/","edition_id":1,"permalink":0,"preferred":1},"url":"\/56-590\/","token":"56\/23\/56-590","dublin_core":{"Title":"Divestiture, functional separation and other corporate relationships","Type":"Text","Format":"text\/html","Identifier":"\u00a7 56-590","Relation":"Code of Virginia"},"html":"\n\t\t\t\t\t\t

A.<\/span> The Commission<\/span> shall not require any incumbent electric utility<\/span> to divest itself of any generation, transmission or distribution assets<\/span> pursuant to any provision of this chapter. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

B.<\/span> 1. The Commission<\/span> shall, however, direct the functional separation of generation, retail transmission and distribution of<\/span> all incumbent electric utilities in connection with the provisions of this chapter to be completed by January 1, 2002. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> By January 1, 2001, each incumbent electric utility<\/span> shall submit to the Commission<\/span> a plan for such functional separation which may be accomplished through the creation of affiliates<\/span>, or through such other means as may be acceptable to the Commission<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> Consistent with this chapter, the Commission<\/span> may impose conditions, as the public interest requires, upon its approval of any incumbent electric utility<\/span>’s plan for functional separation, including requirements that (i) the incumbent electric utility<\/span>’s generation assets<\/span> or, at the election of the incumbent electric utility<\/span> and if approved by the Commission<\/span> pursuant to subdivision 4 of this subsection, their equivalent are made available for electric service during the capped rate<\/span> period as provided in § 56-582<\/a> and, if applicable, during any period the distributor<\/span> serves as a default<\/span> provider as provided for in § 56-585<\/a>; (ii) the incumbent electric utility<\/span> receive Commission<\/span> approval for the sale, transfer or other disposition<\/span> of generation assets<\/span> during the capped rate<\/span> period and, if applicable, during any period the distributor<\/span> serves as a default<\/span> provider; and (iii) any such generation asset sold, transferred, or otherwise disposed of by the incumbent electric utility<\/span> with Commission<\/span> approval shall not be further sold, transferred, or otherwise disposed of during the capped rate<\/span> period and, if applicable, during any period the distributor<\/span> serves as default<\/span> provider, without additional Commission<\/span> approval. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

4.<\/span> If an incumbent electric utility<\/span> proposes that the equivalent to its generation assets<\/span> be made available pursuant to subdivision 3 of this subsection, the Commission<\/span> shall determine the adequacy of such proposal and shall approve or reject such proposal based on the public interest. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

5.<\/span> In exercising its authority under the provisions of this section and under § 56-90<\/a>, the Commission<\/span> shall have no authority to regulate, on a cost-of-service basis or other basis, the price at which generation assets<\/span> or their equivalent are made available for default<\/span> service purposes. Such restriction on the Commission<\/span>’s authority to regulate, on a cost-of-service basis or other basis, prices for default<\/span> service shall not affect the ability of a distributor<\/span> to offer to provide, and of the Commission<\/span> to approve if appropriate the provision of, such services on a cost plus basis or any other basis. The Commission<\/span>’s authority to regulate the price of default<\/span> service shall be consistent with the pricing provisions applicable to a distributor<\/span> pursuant to § 56-585<\/a>. In addition, the Commission<\/span> shall, in exercising its responsibilities under this section and under § 56-90<\/a>, consider, among other factors, the potential effects of any such transfer on: (i) rates<\/span> and reliability of capped rate<\/span> service under § 56-582<\/a>, and of default<\/span> service under § 56-585<\/a>, and (ii) the development of a competitive market in the Commonwealth for retail generation services. However, the Commission<\/span> may not deny approval of a transfer proposed by an incumbent electric utility<\/span>, pursuant to subdivisions 2 and 4 of this subsection, due to an inability to determine, at the time of consideration of the transfer, default<\/span> service prices under § 56-585<\/a>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

C.<\/span> The Commission<\/span> shall, to the extent necessary to promote effective competition in the Commonwealth, promulgate rules and regulations to carry out the provisions of this section, which rules and regulations shall include provisions: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> Prohibiting cost-shifting or cross-subsidies between functionally separate units; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> Prohibiting functionally separate units from engaging in anticompetitive behavior or self-dealing; <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

3.<\/span> Prohibiting affiliated entities from engaging in discriminatory behavior towards nonaffiliated units; and <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

4.<\/span> Establishing codes of conduct detailing permissible relations between functionally separate units. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

D.<\/span> Neither a covered entity<\/span> nor an affiliate<\/span> thereof may be a party<\/span> to a covered transaction<\/span> without the prior approval of the Commission<\/span>. Any such person<\/span> proposing to be a party<\/span> to such transaction shall file an application with the Commission<\/span>. The Commission<\/span> shall approve or disapprove such transaction within sixty days after the filing of a completed application; however, the sixty-day period may be extended by Commission<\/span> order<\/span> for a period not to exceed an additional 120 days. The application shall be deemed approved if the Commission<\/span> fails to act within such initial or extended period. The Commission<\/span> shall approve such application if it finds, after notice and opportunity for hearing<\/span>, that the transaction will comply with the requirements of subsection E, and may, as a part of its approval, establish such conditions or limitations on such transaction as it finds necessary to ensure compliance with subsection E. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

E.<\/span> A transaction described in subsection D shall not: <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

1.<\/span> Substantially lessen competition among the actual or prospective providers of noncompetitive electric service or of a service which is, or is likely to become, a competitive electric service; or <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

2.<\/span> Jeopardize or impair the safety or reliability of electric service in the Commonwealth, or the provision of any noncompetitive electric service at just and reasonable rates<\/span>. <\/i><\/a><\/p><\/section>\n\t\t\t\t\t\t

F.<\/span> Except as provided in subdivision B 5, nothing in this chapter shall be deemed to abrogate or modify the Commission<\/span>’s authority under Chapter 3 (§ 56-55<\/a> et seq.), 4 (§ 56-76<\/a> et seq.) or 5 (§ 56-88<\/a> et seq.) of this title. However, any person<\/span> subject to the requirements of subsection D that is also subject to the requirements of Chapter 5 of this title may be exempted from compliance with the requirements of Chapter 5 of this title. <\/i><\/a><\/p><\/section>","plain_text":" CODE OF VIRGINIA\n\nDIVESTITURE, FUNCTIONAL SEPARATION AND OTHER CORPORATE RELATIONSHIPS (\u00a7 56-590)\n\nA. The Commission shall not require any incumbent electric utility to divest\nitself of any generation, transmission or distribution assets pursuant to any\nprovision of this chapter.\n\nB. 1. The Commission shall, however, direct the functional separation of\ngeneration, retail transmission and distribution of all incumbent electric\nutilities in connection with the provisions of this chapter to be completed by\nJanuary 1, 2002.\n\n 2. By January 1, 2001, each incumbent electric utility shall submit to the\n Commission a plan for such functional separation which may be accomplished\n through the creation of affiliates, or through such other means as may be\n acceptable to the Commission.\n\n 3. Consistent with this chapter, the Commission may impose conditions, as the\n public interest requires, upon its approval of any incumbent electric\n utility’s plan for functional separation, including requirements that\n (i) the incumbent electric utility’s generation assets or, at the\n election of the incumbent electric utility and if approved by the Commission\n pursuant to subdivision 4 of this subsection, their equivalent are made\n available for electric service during the capped rate period as provided in\n § 56-582 and, if applicable, during any period the distributor serves as\n a default provider as provided for in § 56-585; (ii) the incumbent\n electric utility receive Commission approval for the sale, transfer or other\n disposition of generation assets during the capped rate period and, if\n applicable, during any period the distributor serves as a default provider;\n and (iii) any such generation asset sold, transferred, or otherwise disposed\n of by the incumbent electric utility with Commission approval shall not be\n further sold, transferred, or otherwise disposed of during the capped rate\n period and, if applicable, during any period the distributor serves as default\n provider, without additional Commission approval.\n\n 4. If an incumbent electric utility proposes that the equivalent to its\n generation assets be made available pursuant to subdivision 3 of this\n subsection, the Commission shall determine the adequacy of such proposal and\n shall approve or reject such proposal based on the public interest.\n\n 5. In exercising its authority under the provisions of this section and under\n § 56-90, the Commission shall have no authority to regulate, on a\n cost-of-service basis or other basis, the price at which generation assets or\n their equivalent are made available for default service purposes. Such\n restriction on the Commission’s authority to regulate, on a\n cost-of-service basis or other basis, prices for default service shall not\n affect the ability of a distributor to offer to provide, and of the Commission\n to approve if appropriate the provision of, such services on a cost plus basis\n or any other basis. The Commission’s authority to regulate the price of\n default service shall be consistent with the pricing provisions applicable to\n a distributor pursuant to § 56-585. In addition, the Commission shall, in\n exercising its responsibilities under this section and under § 56-90,\n consider, among other factors, the potential effects of any such transfer on:\n (i) rates and reliability of capped rate service under § 56-582, and of\n default service under § 56-585, and (ii) the development of a competitive\n market in the Commonwealth for retail generation services. However, the\n Commission may not deny approval of a transfer proposed by an incumbent\n electric utility, pursuant to subdivisions 2 and 4 of this subsection, due to\n an inability to determine, at the time of consideration of the transfer,\n default service prices under § 56-585.\n\nC. The Commission shall, to the extent necessary to promote effective\ncompetition in the Commonwealth, promulgate rules and regulations to carry out\nthe provisions of this section, which rules and regulations shall include\nprovisions:\n\n 1. Prohibiting cost-shifting or cross-subsidies between functionally separate\n units;\n\n 2. Prohibiting functionally separate units from engaging in anticompetitive\n behavior or self-dealing;\n\n 3. Prohibiting affiliated entities from engaging in discriminatory behavior\n towards nonaffiliated units; and\n\n 4. Establishing codes of conduct detailing permissible relations between\n functionally separate units.\n\nD. Neither a covered entity nor an affiliate thereof may be a party to a covered\ntransaction without the prior approval of the Commission. Any such person\nproposing to be a party to such transaction shall file an application with the\nCommission. The Commission shall approve or disapprove such transaction within\nsixty days after the filing of a completed application; however, the sixty-day\nperiod may be extended by Commission order for a period not to exceed an\nadditional 120 days. The application shall be deemed approved if the Commission\nfails to act within such initial or extended period. The Commission shall\napprove such application if it finds, after notice and opportunity for hearing,\nthat the transaction will comply with the requirements of subsection E, and may,\nas a part of its approval, establish such conditions or limitations on such\ntransaction as it finds necessary to ensure compliance with subsection E.\n\nE. A transaction described in subsection D shall not:\n\n 1. Substantially lessen competition among the actual or prospective providers\n of noncompetitive electric service or of a service which is, or is likely to\n become, a competitive electric service; or\n\n 2. Jeopardize or impair the safety or reliability of electric service in the\n Commonwealth, or the provision of any noncompetitive electric service at just\n and reasonable rates.\n\nF. Except as provided in subdivision B 5, nothing in this chapter shall be\ndeemed to abrogate or modify the Commission’s authority under Chapter 3\n(§ 56-55 et seq.), 4 (§ 56-76 et seq.) or 5 (§ 56-88 et seq.) of\nthis title. However, any person subject to the requirements of subsection D that\nis also subject to the requirements of Chapter 5 of this title may be exempted\nfrom compliance with the requirements of Chapter 5 of this title.\n\nHISTORY: 1999, c. 411; 2000, c. 991; 2001, c. 748; 2007, cc. 888, 933.","edition":{"id":1,"name":"2025","slug":"2025","date_created":"2026-06-21 22:39:22","date_modified":"2026-06-21 22:39:22","current":1,"order_by":1,"last_import":null}}