As used in this part:

1. (1) “Affiliate” means:

   1. (A) Any person covered by the definition of:

      1. (i) “Affiliated interest with a public utility” under Arkansas Code § 23‑1‑101(1);
      2. (ii) “Affiliate” under Arkansas Code § 23‑3‑302(2); or
      3. (iii) “Affiliated company” under Arkansas Code § 23-18-103 (a)(1); and

   2. (B) Any unit, division, separate business activity, or operating part which:

      1. (i) Is within a public utility; and
      2. (ii) Provides assets, goods, services, information having competitive value, personnel, or financial resources other than, or in addition to, public utility service provided directly to Arkansas retail customers;

2. (2) "Affiliate transaction" means a purchase, sale, trade, lease, transfer, sharing or joint use, between a public utility and any affiliate thereof, of assets, whether tangible or intangible, goods, services, information having competitive value, personnel, or financial resources but not including:

   1. (A) Electricity or gas;
   2. (B) Electric transmission;

   3. (C) Any purchase, sale, trade, lease, transfer, sharing or joint use, between a public utility and any affiliate thereof, of:

      1. (i) Capacity and energy;
      2. (ii) Gas, coal, uranium, or other fuel; and

      3. (iii) Related gathering, storage, transportation or assets, services and consumables, in each case the costs of which are recovered by the public utility through Arkansas Public Service Commission-approved:

         1. (a) (a) Base rates; or
         2. (b) (b) A:
3. (1) (1) Purchased gas adjustment;
4. (2) (2) Purchased power adjustment;
5. (3) (3) Fuel adjustment; or

6. (4) (4) Similar mechanism; or

   1. (D) Transactions described in Arkansas Code § 23-3-102(e)(2);
7. (3) “Agreed-upon procedures” means the activities performed by an independent accountant conforming with Interim Attestation Standard AT 201 of the Public Company Accounting Oversight Board, or successor provision, as in force at the time such procedures are required under this part;
8. (4) “Commission” means the Arkansas Public Service Commission;
9. (5) “Direct cost” of a product or service means a cost solely attributable, on a cost‑causative basis, to the production or provision of such individual product or service where the attribution does not require the use of allocations to separate the costs incurred in the production of other services or products;
10. (6) “Fully allocated cost”, with respect to a particular product or service, is the sum of the direct cost and indirect cost of that product or service;

11. (7)

    1. (A) “Market price” means a price determined by a public utility as the amount it would pay or receive for receiving or providing a good or service in an affiliate transaction based on comparisons of similar transactions with, or the price of similar goods and services available from, unrelated third parties.

    2. (B) A public utility may make such determination based on:

       1. (i) Surveys
       2. (ii) Specific price inquiries;
       3. (iii) Benchmarking;
       4. (iv) Competitive bids; or
       5. (v) Any other reasonable method.
    3. (C) For goods or services for which there is no readily available comparative market price, the price shall be the fully allocated cost of the person supplying the goods or services;
12. (8) “Indirect cost” of a product or service means a cost, other than a direct cost, properly attributable to the production or provision of an individual product or service;

13. (9)

    1. (A) “Nonutility asset” is an asset used for one (1) or more nonutility businesses.
    2. (B) Where an asset is used for both utility and nonutility businesses, a “nonutility asset” is an appropriate allocated portion of the shared asset, as determined by the Arkansas Public Service Commission;
14. (10) “Nonutility business” means a business other than the provision of public utility goods or services as defined at subdivision (12) of this section;
15. (11) “Public utility” means all jurisdictional rate-regulated public utilities;
16. (12) “Public utility goods or services” mean goods or services which the public utility is required, by Arkansas statute or Arkansas Public Service Commission rules, to provide to Arkansas retail customers;
17. (13) “Service company” means a person or division that is organized principally for the purpose of providing shared corporate support services to a public utility or its affiliates or divisions;

18. (14) “Shared corporate support services” means services shared between or among a public utility, its parent holding company, or an affiliate or division, such as:

    1. (A) Human resources;
    2. (B) Procurement;
    3. (C) Information technology;
    4. (D) Regulatory services;
    5. (E) Administrative services;
    6. (F) Real estate services;
    7. (G) Legal services;
    8. (H) Accounting services;
    9. (I) Environmental services;
    10. (J) Research and development;
    11. (K) Internal audit;
    12. (L) Community relations;
    13. (M) Corporate communications;
    14. (N) Financial services;
    15. (O) Financial planning and management support; and
    16. (P) Corporate services; and

19. (15) “Utility-related business” means a business which is, or which engages in:

    1. (A) A rate-regulated utility in another state of the United States;
    2. (B) Independent power generation;
    3. (C) Energy marketing and trading;

    4. (D) Gas:

       1. (i) Gathering;
       2. (ii) Production;
       3. (iii) Distribution; and
       4. (iv) Transportation;
    5. (E) Providing fuel to generating plants;
    6. (F) A nuclear decommissioning trust;
    7. (G) An entity created to facilitate tax advantages for the holding company system;
    8. (H) An entity created to facilitate financing transactions;
    9. (I) A captive insurance and other risk management entity;
    10. (J) An entity that holds or manages emission allowances or other environmental allowances or credits;
    11. (K) An entity created to facilitate risk management with respect to the ownership of real property and improvements thereon;
    12. (L) An entity that engages in producing, generating, transmitting, delivering, distributing, storing, selling, marketing, and/or furnishing gas, oil, electricity, thermal energy, and/or steam energy, to wholesale and/or retail customers;

    13. (M) An entity that provides or is engaged in:

        1. (i) Energy management services and demand side management activities;

        2. (ii) Development and commercialization of electrotechnologies related to energy:

           1. (a) (a) Conservation;
           2. (b) (b) Storage; and
        3. (c) (c) Conversion;
        4. (iii) Ownership, operation, sale, installation, and servicing of refueling, recharging, and conversion equipment and facilities relating to electric and compressed natural gas-powered vehicles;
        5. (iv) Sale of electric and gas appliances or equipment to promote new technologies, or new applications for existing technologies, that use gas or electricity and equipment that enables the use of gas or electricity as an alternate fuel and the installation and servicing thereof;

        6. (v) Production, conversion, sale, and distribution of thermal energy products, such as:

           1. (a) (a) Process steam;
           2. (b) (b) Heat;
        7. (c) (c) Hot water;

        8. (d) (d) Chilled water;

           1. (e) (e) Air conditioning;
           2. (f) (f) Compressed air and similar products;
           3. (g) (g) Alternative fuels;
           4. (h) (h) Renewable energy resources; and
        9. (i) (i) The servicing of thermal resources;

        10. (vi) Sale of technical, operational, management, and other similar kinds of services and expertise relating to:

            1. (a) (a) Distribution;
            2. (b) (b) Transmission;
        11. (c) (c) Generation engineering;

        12. (d) (d) Development;

            1. (e) (e) Design and rehabilitation;
            2. (f) (f) Construction;
            3. (g) (g) Maintenance and operation;
            4. (h) (h) Fuel procurement, delivery, and management; and
        13. (i) (i) Environmental licensing, testing, and remediation;
        14. (vii) Ownership, operation, and servicing of fuel procurement, transportation, handling, and storage facilities, scrubbers, and resource recovery and waste water treatment facilities, including activities related to nuclear fuels;
        15. (viii) Development and commercialization of technologies or processes that utilize coal waste or by-products as an integral component of such technology or process;
        16. (ix) Securitization activities;
        17. (x) Development activities relating to other authorized electric- or gas-related activities;
        18. (xi) Local community development investments relating to other authorized electric or gas-related activities; or
        19. (xii) Sales of assets related to other authorized electric- or gas-related activities; or
    14. (N) Other utility-related activities as determined on a case-by-case basis by the Arkansas Public Service Commission.

Codification Notes: This section was promulgated as Rule III of the Affiliate Transaction Rules prior to codification in the Code of Arkansas Rules.