Sec. 1. 35-A MRSA §3204, sub-§3, as amended by PL 1999, c. 398, Pt. N, §1, is further amended to read:

3. Extension; separation required. An investor-owned electric utility may apply to the commission for an extension to permit the utility to divest one or more generation assets or generation-related business activities after March 1, 2000. The commission shall grant an extension if the commission finds that an extension would be likely to improve the sale value of those assets on the market or would be likely to reduce the level of the utility's stranded costs.

The commission by rule shall establish the procedure for granting extensions. Rules adopted under this subsection are major substantive routine technical rules pursuant to Title 5, chapter 375, subchapter II-A.

Sec. 2. 35-A MRSA §3204, sub-§4, as enacted by PL 1997, c. 316, §3, is amended to read:

4. Sale of capacity and energy required. The commission by rule shall require each investor-owned electric utility after February 28, 2000 to sell rights to capacity and energy from all generation assets and generation-related business, including purchased power contracts that are not divested pursuant to subsection 1, except those rights to capacity and energy that the commission determines are necessary for the utility to perform its obligations as a transmission and distribution utility in an efficient manner.

In the rules adopted under this subsection, the commission shall establish procedures to promote the maximum market value for these rights. Nothing in this subsection prohibits a utility from re-negotiating, buying out or buying down a contract with a qualifying facility in accordance with applicable laws. By March 1, 1999, the The commission shall provisionally adopt all rules required under this subsection. Rules adopted under this subsection are major substantive routine technical rules pursuant to Title 5, chapter 375, subchapter II-A.

Sec. 3. 35-A MRSA §3212, sub-§1, as enacted by PL 1997, c. 316, §3, is amended to read:

1. Establishment of terms and conditions. The commission shall open a rule-making proceeding no later than October 1, 1997 to establish terms and conditions for standard-offer service that include, but are not limited to: