Common Contracts

Electricity Tax Agreement LPPC/APPA and EEI

July 11th, 2000

• Filed
  July 11th, 2000

The industry agreement on electricity restructuring tax issues is intended to modify the federal tax laws to remove certain impediments to effective competition in the electric power industry. The agreement is intended to preserve the right to use tax-exempt financing to serve public power systems’ own electric load and remove the current tax law impediments to opening up these systems to competition. The agreement preserves public systems’ use of tax-exempt bonds to finance distribution facilities, with some limitations. The agreement eliminates taxation of customer contributions in aid of construction for shareholder-owned systems’ electric transmission and distribution facilities. The agreement also facilitates FERC’s open access transmission policies by allowing public systems to provide open access without violating private use rules and by providing tax relief to shareholder-owned utilities that sell or spin-off transmission facilities to businesses that join independent regional