[§269-193]  Default of electric utility; successor requirements.  (a)  After an obligee provides notice to the department of a default of a covered power purchase agreement, the department shall promptly provide the electric utility with a copy of the notice.  No later than twenty-four hours from the time the electric utility receives the notice, the electric utility shall record a journal entry accounting for the transfer of all revenues from the power purchase charges arising from any covered power purchase agreements identified in the notice, regardless of when collected, then in its possession, to the fund established pursuant to section 269-194(a).  No later than forty-eight hours from the time the electric utility receives the notice, the electric utility shall transfer all revenues from the power purchase charges arising from any covered power purchase agreements identified in the notice, regardless of when collected, then in its possession, and, subject to section 269-192(e), all future revenues from the power purchase charges arising from the covered power purchase agreement identified in the notice and reserve fees thereafter collected to the fund established pursuant to section 269-194(a).  These amounts shall include all revenues from power purchase charges and reserve fees received by the electric utility after a default for the power purchase charges and reserve fees billed before the default.  Following a default, the department shall use the revenues collected from the power purchase charges and reserve fees on deposit in the fund, only in the order as follows:

     (1)  To pay power purchase costs pursuant to step-in agreements, subject to the appointment, authorization, and empowerment of the electric utility as an agent as described in section 269-196(e); provided that, for purposes of complying with the requirements of this part, the department shall have a right, but not an obligation, in determining the amounts owed to an obligee, to rely on an invoice from an obligee describing amounts owed, and the department shall not be deemed to have breached the step-in agreement by sole reason of having relied or failed to rely on the invoice; and notwithstanding any law to the contrary, the department shall not be bound to make any independent calculation, verification, or investigation into the invoice from an obligee;

     (2)  To recover any incremental administrative costs of the electric utility or the department incurred to implement the requirements of this part; and

     (3)  To implement a rate credit to customers.

     (b)  Any step-in agreement shall remain in effect notwithstanding any bankruptcy, reorganization, or other insolvency proceedings with respect to the electric utility.

     (c)  The obligation of the electric utility to collect and remit the revenues from power purchase charges and reserve fees pursuant to the requirements of this part shall not be subject to any setoff, counterclaim, surcharge, or defense by the electric utility, or in connection with a bankruptcy of any electric utility.

     (d)  Any successor to an electric utility shall be bound by the requirements of this part.  The successor shall perform and satisfy all obligations of the electric utility in the same manner and to the same extent as the electric utility, including the obligations upon a default.

     (e)  If a step-in agreement is terminated as described in section 269-192(d), then by operation of law, any title to the revenues related to power purchase charges attributable to the related covered power purchase agreement shall immediately cease to be held in trust and the electric utility or its successor shall thereafter be the sole holder of title or beneficial and equitable interest in, and any claim or right to, the revenues related to power purchase charges attributable to the related covered power purchase agreement, and the obligation of the electric utility or its successor to bill and collect the power purchase charges and reserve fees for the covered power purchase agreement as an agent for the department, and, if applicable, to remit the collected revenues for the covered power purchase agreement to the fund, shall terminate. [L 2025, c 191, pt of §2]