15 Pa.C.S. Ch. 73

in effect

15 Pa.C.S. § 7301 Short titles.

(a) Short title of chapter.--This chapter shall be known and may be cited as the Electric Cooperative Law of 1990. (b) Short title of Subchapter C.--Subchapter C shall be known and may be cited as the Unincorporated Area Certified Territory Law of 1990.

15 Pa.C.S. § 7302 Application of chapter.

(a) General rule.--This chapter shall apply to and, unless the context clearly indicates otherwise, the term "corporation" or "electric cooperative corporation" in this chapter shall mean a corporation incorporated under: (1) the act of June 21, 1937 (P.L.1969, No.389), known as the Electric Cooperative Corporation Act; or (2) this chapter. (b) Provisions complete in themselves.--The provisions of this chapter, as supplemented by or pursuant to Subchapters A (relating to general provisions) and C (relating to cooperative contracts) of Chapter 71, are complete in themselves and shall be controlling. The provisions of any other law of this Commonwealth, except as provided in Part V of Title 1 (relating to statutory construction) and in this chapter, shall not apply to a corporation subject to this chapter. Cross References. Section 7302 is referred to in section 7308 of this title; section 8201 of Title 68 (Real and Personal Property); section 9004 of Title 75 (Vehicles).

15 Pa.C.S. § 7303 Definitions.

The following words and phrases when used in this subchapter and Subchapter B (relating to powers, duties and safeguards) shall have the meanings given to them in this section unless the context clearly indicates otherwise: "Acquire." Construct or acquire by purchase, lease, devise, gift or other mode of acquisition. "Board." A board of directors of a corporation. "Federal agency." Includes the United States of America and any department, administration, commission, board, bureau, office, establishment, agency, authority or instrumentality of the United States of America, heretofore or hereafter created. "Member." The incorporators of a corporation and each person thereafter lawfully admitted to membership therein. "Obligations." Includes bonds, notes, debentures, interim certificates or receipts and all other evidences of indebtedness issued by a corporation, whether secured or unsecured. "Person." Includes any Federal agency, State or political subdivision thereof or any body politic. "Rural area." Any area, not included within the boundaries of any incorporated or unincorporated city, town, village or borough, having a population in excess of 2,500 inhabitants, including both the farm and nonfarm population thereof.

15 Pa.C.S. § 7304 Number and qualifications of incorporators.

Three or more natural persons of full age who are residents of this Commonwealth may incorporate an electric cooperative corporation.

15 Pa.C.S. § 7305 Purpose.

Nonprofit cooperative corporations may be organized under this chapter for the purpose of engaging in rural electrification by any one or more of the following methods: (1) Furnishing of electric energy to persons in rural areas who are not receiving central station service. (2) Assisting in the wiring of the premises of persons in rural areas or the acquisition, supply or installation of electrical or plumbing equipment therein. (3) Furnishing of electric energy, wiring facilities, electrical or plumbing equipment or services to any other corporation or to the members thereof.

15 Pa.C.S. § 7306 Articles of incorporation.

(a) General rule.--The articles of incorporation shall state: (1) The name of the corporation, which shall include the words "Electric Cooperative" and the word "Corporation," "Incorporated," "Inc." or "Company" and shall not be confusingly similar to the name of any other corporation. (2) The purpose for which the corporation is formed. (3) The names and addresses of the incorporators who shall serve as directors and manage the affairs of the corporation until its first annual meeting of members or until their successors are elected and qualify. (4) The number of directors, not less than three, to be elected at the annual meetings of members. (5) Subject to section 109 (relating to name of commercial registered office provider in lieu of registered address), the address, including street and number, if any, of its registered office. (6) The period of duration of the corporation, which may be perpetual. (7) The terms and conditions upon which persons will be admitted to membership and retain membership in the corporation, but, if expressly so stated, the determination of these matters may be reserved to the directors by the bylaws. (8) Any provisions, not inconsistent with law, which the incorporators choose to insert for the regulation of the business and affairs of the corporation. (b) Cross references.--See section 134 (relating to docketing statement) and Subchapter A of Chapter 53 (relating to incorporation generally).

15 Pa.C.S. § 7307 Prohibition on use of words "electric cooperative." The words "electric cooperative" shall not be used in the corporate name of any domestic or foreign corporation for profit or not-for-profit other than a corporation existing under this chapter.

Cross References. Section 7307 is referred to in section 7103 of this title.

15 Pa.C.S. § 7308 Liberal construction.

All of the provisions of law applicable to electric cooperative corporations shall be construed liberally. The enumeration of any object, purpose, power, manner, method or thing shall not be deemed to exclude like or similar objects, purposes, powers, manners, methods or things. See section 7302(b) (relating to provisions complete in themselves).

15 Pa.C.S. § 7321 Special powers and limitations.

(a) General rule.--Each electric cooperative corporation shall have power (in addition to or limitation of the powers conferred by section 5502 (relating to general powers)): (1) To generate, manufacture, purchase, acquire and accumulate electric energy and to transmit, distribute, sell, furnish and dispose of such electric energy to its members only; and to construct, erect, purchase, lease as lessee and, in any manner, acquire, own, hold, maintain, operate, sell, dispose of, lease as lessor, exchange and mortgage plants, buildings, works, machinery, supplies, equipment, apparatus and transmission and distribution lines or systems necessary, convenient or useful. (2) To assist its members only to wire their premises and install therein electrical and plumbing fixtures, machinery, supplies, apparatus and equipment of any and all kinds and character and, in connection therewith and for those purposes, to purchase, acquire, lease, sell, distribute, install and repair electrical and plumbing fixtures, machinery, supplies, apparatus and equipment of any and all kinds and character and to receive, acquire, endorse, pledge, hypothecate and dispose of notes, bonds and other evidences of indebtedness. (3) To furnish to other corporations organized under this chapter, or to the members thereof, electric energy, wiring facilities, electrical and plumbing equipment and services convenient or useful. (4) In connection with the acquisition, construction, improvement, operation or maintenance of its lines, to use any highway or any right-of-way, easement or other similar property right owned or held by the Commonwealth or any political subdivision thereof. (5) To have and exercise the power of eminent domain for the purpose and in the manner provided by the condemnation laws of this Commonwealth relating to public utility corporations for acquiring private property for public use, such right to be paramount except as to property of the Commonwealth or of any political subdivision thereof or any public utility corporation, other than one engaged in furnishing electric energy to the public, except that the right of eminent domain shall exist in order to cross the lines of any public utility not furnishing electric energy if the crossing is effected in such manner as not to interfere with the service lines or the service of the public utility. (6) To fix, regulate and collect rates, fees, rents or other charges for electric energy and any other facilities, supplies, equipment or services furnished by the corporation. (7) To accept gifts or grants of money, services or property, real or personal. (8) To do and perform, either for itself or its members or for any other corporation, or for the members thereof, any and all acts and things and to have and exercise any and all powers as may be necessary, convenient or appropriate to effectuate the purpose for which the corporation is incorporated. (b) Enumeration unnecessary.--It shall not be necessary to set forth in the articles of the corporation the powers enumerated in this chapter.

15 Pa.C.S. § 7322 Bylaws.

The power to make, alter or repeal the bylaws of an electric cooperative corporation shall be vested in the board of directors. The bylaws may contain any provisions for the regulation and management of the affairs of the corporation, not inconsistent with law or the articles.

15 Pa.C.S. § 7323 Exemption of members from liability for debts of corporation.

A member shall not be liable for the debts of an electric cooperative corporation to an amount exceeding the sums remaining unpaid on his membership fee, but nothing in this chapter shall be construed to relieve any member from the payment of any debt due by him to the corporation.

15 Pa.C.S. § 7324 Qualifications of members.

All persons in rural areas proposed to be served by an electric cooperative corporation, who are not receiving central station service, shall be eligible for membership in the corporation. No person other than the incorporators shall be, become or remain a member of the corporation unless the person uses or agrees to use electric energy or, as the case may be, the facilities, supplies, equipment and services furnished by the corporation. A corporation existing under this chapter may become a member of another such corporation and may avail itself fully of the facilities and services thereof.

15 Pa.C.S. § 7325 Annual meeting of members.

(a) Time of annual meeting.--An annual meeting of the members of an electric cooperative corporation shall be held at such time as may be provided in the bylaws. (b) Call of special meetings.--Special meetings of the members may be called by: (1) the president; (2) the board of directors; (3) petition signed by not less than one-tenth of all of the members; or (4) such other officers or persons as may be provided in the bylaws. (c) Notice of meetings.--Written notice of every meeting of members shall be delivered not less than ten nor more than 30 days before the date of the meeting. If mailed, the notice shall be deemed to be delivered when deposited in the United States mails in a sealed envelope, addressed to the member at his address as it appears on the records of the corporation, with postage thereon prepaid.

15 Pa.C.S. § 7326 Voting by members.

Each member present shall be entitled to one and only one vote on each matter submitted to a vote at a meeting of members of an electric cooperative corporation, but voting by proxy or by mail may be provided for in the bylaws.

15 Pa.C.S. § 7327 Certificates of membership.

When a member of an electric cooperative corporation has paid the membership fee in full, a certificate of membership shall be issued to the member. Memberships in the corporation and the certificates shall be nontransferable. The certificate of membership shall be surrendered to the corporation upon the resignation, expulsion or death of the member.

15 Pa.C.S. § 7328 Quorum of members.

Unless otherwise provided in the bylaws, a majority of the members present, in person or represented by proxy, shall constitute a quorum for the transaction of business at a meeting of members of an electric cooperative corporation, but, if voting by mail is provided for in the bylaws, members so voting shall be counted as if present.

15 Pa.C.S. § 7329 Directors.

(a) General rule.--The business and affairs of an electric cooperative corporation shall be managed under the direction of a board of not less than three directors who shall be natural persons of full age. All directors shall be members. (b) Vacancies.--Any vacancy occurring in the board and any directorship to be filled shall be filled, as provided in the bylaws, by persons who shall serve until directors may be regularly elected.

15 Pa.C.S. § 7330 Nonprofit operation.

(a) General rule.--Each electric cooperative corporation shall be operated without profit to its members, but the rates, fees, rents or other charges for electric energy and any other facilities, supplies, equipment or services furnished by the corporation shall be sufficient at all times: (1) To pay all operating and maintenance expenses necessary or desirable for the prudent conduct of its business and the principal of and interest on the obligations issued or assumed by the corporation in the performance of the purpose for which it was organized. (2) For the creation of reserves. (b) Disposition of revenues.--The revenues of the corporation shall be devoted, first, to the payment of operating and maintenance expenses and the principal and interest on outstanding obligations and, thereafter, to such reserves for improvement, new construction, depreciation and contingencies as the board may, from time to time, prescribe. (c) Patronage distributions.--Revenues not required for the purposes set forth in subsection (b) shall be returned, from time to time, to the members on a pro rata basis, according to the amount of business done with each during the period, either in cash, in abatement of current charges for electric energy or otherwise, as the board determines, but the return may be made by way of general rate reduction to members if the board so elects.

15 Pa.C.S. § 7331 Merger, division or sale of assets.

(a) Merger or division.--Any two or more electric cooperative corporations may merge or divide but only if the surviving or resulting corporation is a corporation existing under this chapter. Every merger or division shall be proposed by the adoption by the board of directors of a resolution approving the plan of merger or division and directing that the plan be submitted to a vote of the members entitled to vote thereon at a regular or special meeting of the members. (b) Sale of assets.--An electric cooperative corporation may sell, lease, lease-sell, exchange or otherwise dispose of all or substantially all of its assets only when authorized by the affirmative vote of two-thirds of all the members of the corporation. (1) The plan of asset transfer shall set forth the terms and conditions of the sale, lease, exchange or other disposition or may authorize the board of directors to fix any or all of the terms and conditions, including the consideration to be received by the corporation therefor. (2) Prior to submission for consideration by the members of the corporation, the board of directors of the corporation shall first give all other domestic electric cooperative corporations an opportunity to submit competing proposals. Such opportunity shall be in the form of a written notice to such corporations, which notice shall be attached to a copy of the proposal which the corporation has already received. Such corporations shall be given not less than 30 days during which to submit competing proposals, and the actual minimum period within which proposals are to be submitted shall be stated in the written notice given to them. (3) Within 30 days after expiration of the notice period set by the board of directors under paragraph (2), written notice of the special meeting to consider and take action on the plan of asset transfer and expressing in detail each of the proposals shall be given to each member of the corporation. The special meeting shall not be held sooner than 30 days after the giving of such notice to the members. (4) After a plan of asset transfer has been authorized by the members, the board of directors, in its discretion, may abandon the sale, lease, lease-sale, exchange or other disposition, subject to the rights of third parties under any contracts relating thereto, without further action or approval by the members. (Nov. 3, 2022, P.L.1791, No.122, eff. 60 days) 2022 Amendment. Act 122 amended the heading and subsec. (a).

15 Pa.C.S. § 7332 Dissolution.

An electric cooperative corporation may dissolve only when authorized by the affirmative vote of two-thirds of all the members of the corporation. Any assets remaining after all liabilities or obligations of the corporation have been satisfied or discharged upon dissolution shall be distributed pro rata among the members of the corporation at the time of the filing of the certificate of dissolution.

15 Pa.C.S. § 7333 License fee; exemption from excise taxes.

Electric cooperative corporations subject to this chapter shall pay annually, on or before July 1, to the Department of Revenue a fee of $10 for each 100 members or fraction thereof but shall be exempt from all other State taxes of whatsoever kind or nature.

15 Pa.C.S. § 7334 Exemption from jurisdiction of Public Utility Commission.

Except as provided in Subchapter C (relating to unincorporated area certified territory), all electric cooperative corporations subject to this chapter shall be exempt in any and all respects from the jurisdiction and control of the Pennsylvania Public Utility Commission.

15 Pa.C.S. § 7335 Limited exemption from Securities Act.

Whenever any electric cooperative corporation subject to this chapter has borrowed money from any Federal agency, the obligations issued to secure the payment of the money shall be exempt from the provisions of the act of December 5, 1972 (P.L.1280, No.284), known as the Pennsylvania Securities Act of 1972, nor shall the provisions of that act apply to the issuance of membership certificates.

15 Pa.C.S. § 7351 Application of subchapter.

(a) General rule.--This subchapter shall apply only to the establishment of boundaries of certified territory between retail electric suppliers where one supplier is an electric cooperative corporation and the other supplier is subject to the jurisdiction of the Pennsylvania Public Utility Commission for rates, terms and conditions for electric service. (b) Municipal corporations.--Nothing contained in this subchapter shall in any respect affect any of the rights, privileges or obligations of any municipal corporation furnishing retail electric service.

15 Pa.C.S. § 7352 Definitions.

The following words and phrases when used in this subchapter shall have the meanings given to them in this section unless the context clearly indicates otherwise: "Certified territory." An unincorporated area as certified pursuant to section 7354 (relating to boundaries of certified territories; hearings). "Commission." The Pennsylvania Public Utility Commission of the Commonwealth. "Electric-consuming facilities." Everything that utilizes electric energy from a central station source. "Existing distribution line." An electric line of a design voltage of 35 kV phase to phase or less which on July 30, 1975: (1) was located in an unincorporated area; and (2) was or had been used for retail electric service. "Hearing." A hearing by the commission pursuant to reasonable notice to all affected retail electric suppliers. "Retail electric service." Electric service furnished to a consumer for ultimate consumption, but not including wholesale electric energy furnished by an electric supplier to another electric supplier for resale. "Retail electric supplier." Any person, exclusive of a municipal corporation, engaged in the furnishing of retail electric service. The term shall apply only to a retail electric supplier which is an electric cooperative corporation and to a retail electric supplier which is subject to the jurisdiction of the commission for rates, terms and conditions for electric service and has a mutual boundary in an unincorporated area with an electric cooperative corporation. "Unincorporated area." A geographical area outside the corporate limits of cities and boroughs.

15 Pa.C.S. § 7353 Geographical areas.

It is hereby declared to be in the public interest that, to encourage the orderly development of retail electric service in unincorporated areas, to avoid wasteful duplication of distribution facilities, to avoid unnecessary encumbering of the landscape of the Commonwealth, to prevent the waste of materials and natural resources, to minimize inconvenience, diminished efficiency and higher costs in serving the consumer and otherwise for the public convenience and necessity, the Commonwealth is divided into geographical areas, establishing the unincorporated areas within which each retail electric supplier is to provide retail electric service on an exclusive basis. Cross References. Section 7353 is referred to in section 7354 of this title.

15 Pa.C.S. § 7354 Boundaries of certified territories; hearings.

(a) Exclusive territories.--Except as otherwise provided in this section, a retail electric supplier shall not furnish retail electric service in the certified territory of another retail electric supplier. (b) Establishment of boundaries.--Except as otherwise provided in this section, the boundaries of the certified territory of each retail electric supplier in any unincorporated area are hereby set as a line or lines substantially equidistant between its existing distribution lines and the nearest existing distribution lines of any other retail electric supplier in every direction with the result that there is hereby certified to each retail electric supplier such unincorporated area which in its entirety is located substantially in closer proximity to one of its existing distribution lines than the nearest existing distribution line of any other retail electric supplier. (c) Maps of certified territories.--On or before July 30, 1976, or, when requested in writing by a retail electric supplier and for good cause shown, such further time as the Pennsylvania Public Utility Commission may fix by order, each retail electric supplier shall file with the commission a map or maps showing all of its existing distribution lines as of July 30, 1975. The commission shall prepare or order to be prepared and filed in the manner and form prescribed by the commission within six months thereafter a map or maps of uniform scale to show, accurately and clearly, the boundaries of the certified territory of each retail electric supplier as established under subsection (a) and shall issue such map or maps of certified territory to each retail electric supplier. (d) Commission certification of service territories.--In each unincorporated area, where the commission determines that the existing distribution lines of two or more retail electric suppliers are so intertwined or located that subsection (a) cannot reasonably be applied, the commission shall, after hearing, certify the service territory or territories for the retail electric suppliers so as to promote the legislative policy stated in section 7353 (relating to geographical areas). (e) Examination and correction of maps.--Each retail electric supplier shall have the right to examine the maps of other retail electric suppliers filed with the commission pursuant to this subchapter, and, if any errors are observed, any retail electric supplier may informally petition the commission for a conference of the affected parties to resolve the alleged error. The petitioner shall serve a copy of the petition by certified mail on the retail electric supplier whose map is alleged to contain the error. The commission shall arrange a conference as promptly as practicable after receipt of the petition and shall give notice thereof to all retail electric suppliers affected by the alleged error. If the alleged error is not corrected to the satisfaction of any affected retail electric supplier, the supplier may petition the commission for a hearing, and the hearing shall be granted by the commission as promptly as practicable. Upon completion by the commission of a map or maps showing the boundaries of the certified territory of a retail electric supplier as established under subsection (a), other retail electric suppliers shall have the right to examine the map or maps and, if any errors exist in location of boundary lines, any retail electric supplier aggrieved thereby may informally petition the commission for a conference to resolve the issue of the alleged incorrect location of boundary. The procedure shall be as specified in this section for resolution of alleged errors in the maps supplied by any retail electric supplier. (f) Adjustment of certified territories.--After the initial establishment of the certified territory of each retail electric supplier, two or more retail electric suppliers may, from time to time, jointly apply to the commission for adjustment of their adjoining certified territories, and, if the commission finds that the adjustment is consistent with the purposes of this subchapter and its standards, the commission shall approve the adjustment and, to the extent required, shall prepare or cause to be prepared revised maps in accordance with subsection (c) to reflect the adjustment. Cross References. Section 7354 is referred to in sections 7352, 7355, 7359 of this title.

15 Pa.C.S. § 7355 Obligations and rights within certified territory; new electric-consuming facilities.

(a) Service within certified territory.--Except as otherwise provided in this section, each retail electric supplier shall be obligated (upon receipt of an application in accordance with its tariffs, rules, regulations or bylaws) and shall have the exclusive right to furnish retail electric service to all electric-consuming facilities located within its certified territory and shall not furnish, make available, render or extend its retail electric service to a consumer for use in electric-consuming facilities located within the certified territory of another retail electric supplier. Any retail electric supplier may extend its facilities through the certified territory of another retail electric supplier if the extension is necessary for the supplier to connect any of its facilities or to serve its consumers within its own certified territory, but any such extension shall not be deemed to be an existing distribution line. (b) Service to new electric-consuming facilities.--Except as provided in subsections (c) and (e), any new electric-consuming facility located in an unincorporated area which has not as yet been included in a map issued by the Pennsylvania Public Utility Commission pursuant to section 7354(c) (relating to maps of certified territories) or certified pursuant to section 7354(d) (relating to commission certification of service territories) shall be furnished retail electric service by the retail electric supplier which has an existing distribution line in closer proximity to the electric-consuming facility than is the nearest existing distribution line of any other retail electric supplier. Any disputes under this subsection shall be resolved by the commission. (c) Correction of inadequate service.--If the commission, after hearing, determines that the retail electric service being furnished or proposed to be furnished by a retail electric supplier to an electric-consuming facility is inadequate and is not likely to be made adequate, the commission may authorize another retail electric supplier to furnish retail electric service to that facility. (d) Electric-consuming facilities served by another retail electric supplier.--Except as provided in subsection (c), no retail electric supplier shall furnish, make available, render or extend retail electric service to any electric-consuming facility to which the service is being lawfully furnished by another retail electric supplier on July 30, 1975, or to which retail electric service is lawfully commenced thereafter in accordance with this section by another retail electric supplier. (e) Extension of service.--The provisions of this subchapter shall not preclude any retail electric supplier from extending its service after July 30, 1975, to its own property and facilities, but any facilities involved in the extension shall not be deemed an existing distribution line.

15 Pa.C.S. § 7356 Borderline service.

Notwithstanding the establishment of certified territories pursuant to this subchapter and the obligations and rights to furnish service within the territory, a retail electric supplier may request another retail electric supplier to render service to one or more electric-consuming facilities where, in the judgment of the requesting retail electric supplier, it would be more economical or otherwise in the public interest for the other retail electric supplier to do so and to enter into a contract for that purpose with the other retail electric supplier.

15 Pa.C.S. § 7357 Effect of incorporation, annexation or consolidation.

After July 30, 1975, the inclusion by incorporation, consolidation or annexation of any part of the certified territory of a retail electric supplier within the boundaries of any city or borough shall not in any respect impair or affect the rights of the retail electric supplier to continue and extend electric service at retail throughout any part of its certified territory.

15 Pa.C.S. § 7358 Enforcement of compliance by commission.

Upon proceedings brought by an interested person or by action of the Pennsylvania Public Utility Commission, the commission shall have the jurisdiction to enforce compliance with this subchapter and shall have jurisdiction to prohibit the furnishing of retail electric service by any retail electric supplier except in its certified territory or territories or where lawfully serving and, in connection with the enforcement and prohibition, to exercise all powers granted by this subchapter or otherwise to the commission.

15 Pa.C.S. § 7359 Expenses.

(a) General rule.--The expenses of the Pennsylvania Public Utility Commission in administering this subchapter shall be assessed by the commission against the affected retail electric suppliers on the following basis: (1) Expenses which relate to the preparation or review of maps to establish the certified territory of a single retail electric supplier in any county or other area where there is no other retail electric supplier shall be assessed solely to such single retail electric supplier. (2) Expenses which relate to the preparation or review of maps to establish the certified territories of two or more retail electric suppliers in any county or other area where there are two or more retail electric suppliers shall be assessed in equal shares among such retail electric suppliers. (3) Expenses which relate to the consideration and disposition of alleged errors pursuant to section 7354(e) (relating to examination and correction of maps) and the consideration and disposition of proposed adjustments pursuant to section 7354(f) (relating to adjustment of certified territories) shall be assessed in equal shares among the retail electric suppliers affected thereby. (4) Expenses which relate to the enforcement by the commission of compliance with this subchapter shall be assessed in equal shares against the retail electric supplier or suppliers to which an order of enforcement is directed. If the enforcement proceedings were initiated by a retail electric supplier or suppliers and if no order of enforcement is issued by the commission, the expenses shall be assessed in equal shares against the retail electric supplier or suppliers initiating the proceedings. (5) Any other expenses of the commission shall be assessed by the commission in equal shares among the retail electric suppliers that are subject to this subchapter. (b) Estimated expenses.--The commission may, if it deems such action appropriate, assess expenses on the basis of estimates made by it with appropriate adjustment or credit after final determination of the expenses.

Source: Open US Law by Vaquill AI (CC BY 4.0)URL: https://www.palegis.us/statutes/consolidated/view-statute?txtType=HTM&ttl=15Fetched: 10/16/2026