Special Subcommittee on Energy


Minutes of the<MeetNo1> 1st Meeting

of the 2005 Session Break


<MeetMDY1> January 14, 2005



The<MeetNo2> 1st meeting of the Special Subcommittee on Energy during the 2005 session break was held on<Day> Friday,<MeetMDY2> January 14, 2005, at<MeetTime> 11:00 AM, in<Room> Room 131 of the Capitol Annex. Senator Robert Stivers II, Chair, called the meeting to order, and the secretary called the roll.


Present were:


Members:<Members> Senator Robert Stivers II, Co-Chair; Representative Tanya G Pullin, Co-Chair; Senators Charlie Borders, Denise Harper Angel, Ernie Harris,  Jerry P Rhoads, and Johnny Ray Turner; Representatives Royce W Adams, Eddie Ballard, Carolyn Belcher, James E Bruce, Dwight D Butler, Bob M DeWeese, J R Gray, and Brandon D Smith.


Guests:  Eric Gregory, East Kentucky Power Coop; Jason Bentley, Anupa Arya and Garnett Thurman Jr., Public Service Commission; Sarah McCann, Commerce Cabinet; Chris Nolan, McBrayer, McGinnis, Leslie and Kirkland; Ari Geertsema, Center of Applied Energy Research; B. Raff, Kentucky Resources Council; Nancy Shelton, Tennessee Valley Association; and John Cooper.


LRC Staff:  D. Todd Littlefield, William Bowker and Rhonda Carter


Chairman Stivers opened the meeting, greeted new and returning members of the subcommittee, noted the presence of a quorum, and asked for and received approval of minutes from the 2004 Interim meeting.


Chairman Stivers called on Secretary of Commerce James Host to discuss the development of a Kentucky energy policy by the Commonwealth Energy Policy Task Force (CEPTF).  Chairman Stivers also welcomed Secretary of Environmental and Public Protection, LaJuana Wilcher, and Secretary of Finance and Administration, Robbie Rodolph.  Secretary Host stated that Secretaries Wilcher and Rudolph, along with Economic Development Secretary Gene Strong and Secretary of Education Virginia Fox, are members of the Commonwealth Energy Policy Task Force as are subcommittee Co-chairs Stivers and Pullin.


Secretary Host discussed the importance of energy to Kentucky's citizens and economic development and the need for an energy policy to ensure the best development and use of Kentucky's energy resources and to promote Kentucky's energy related interests in national and international policy.  Secretary Wilcher agreed that energy is vital to Kentucky and emphasized the need for energy conservation to keep energy costs for citizens and industry as low as possible.  Secretary Rudolph stated that low-cost and abundant energy are vital to manufacturing in Kentucky.


Following the presentation by Secretary Host, members of the Subcommittee commented and asked questions.  Representative Bruce noted the importance of the coal reserves of Muhlenberg County and other areas of West Kentucky


Representative Gray asked if West Virginia has a tax on residential utility service.  Secretary Wilcher responded that she would get that information for the subcommittee.


Representative Pullin stated that the subcommittee had been very active in development of energy policy and had drafted a resolution in the 2004 Regular Session concerning the need for an energy policy and calling for creation of a cabinet level Kentucky energy agency.


Chairman Stivers stated that the subcommittee had been very well represented at the statewide public meetings of the CEPTF and that he had learned much about biodiesel and ethanol on a trip to a ethanol plant in Western Kentucky with Senator Pendleton.


Senator Rhoads stated that he had attended the CEPTF public meeting in Hopkinsville and was very impressed with the openness of the process and how the Task Force sought input from all interested citizens.  He stated that an energy policy will offer the opportunity for Kentucky to develop economically through the development and use of our own resources, especially coal.


Senator Pendleton stated that it was very important that the Task Force had held public meetings throughout Kentucky and asked when the energy policy will be made public.  Secretary Host responded that the policy will be released during the first part of February, 2005, and that subcommittee members will be notified as to the date and time.


Chairman Stivers thanked Secretary Host and Secretaries Wilcher and Rudolph for their presentation and remarks.  He then called on Jason Bentley, General Counsel, Kentucky Public Service Commission, to discuss with the Subcommittee the PSC's proposed amendment to 807 KAR 5:120, concerning PSC issuance of a certificate of public convenience and necessity (CPCN) for constructing electric transmission lines.  Mr. Bentley stated that the amendment makes three minor changes that are needed for the regulations to work effectively and discussed each of the changes.  The amendment was a part of each member's folder and is located in the file as a part of this record.


Chair Pullin asked Mr. Bentley if the amendment was made before or after a comment period or as a result of public comments.  She stated that the amendment was not brought before the Administrative Regulations Review Committee.  Mr. Bentley responded that the amendment addresses the concerns of many utilities that having to include proposed transmission structures in the maps to be filed with the request for a CPCN would be premature.  The utilities believe that identifying the proposed right of way would be sufficient for identifying affected property owners who are entitled to intervene.  Mr. Bentley stated that the public did comment on the proposed changes and that they are included in the statement of consideration.


Representative Belcher asked about language that had been stricken, specifically referring to the requirement that an application include a copy of each government agency-required written assessment of environmental, archeological, historical and other impacts.  Mr. Bentley explained that this was wording in the proposed regulation that had been changed after public comment and that the wording in question is not included in the final regulation that went before the Administrative Regulation Review Subcommittee.


Chair Stivers asked if there were a motion to adopt the amendment. Representative Bruce moved adoption of the amendment, with Senator Harris seconding, and the amendment was adopted by voice vote.


There being no further business, the meeting was adjourned.