(II) UNIVERSAL SERVICE PROGRAMS AND OTHER PUBLIC PURPOSE
PROGRAMS; AND

(III) CONSUMER EDUCATION PROGRAMS UNDER § 7-505(B)(1) OF

THIS SUBTITLE.

(2) THE COSTS SUBJECT TO THIS SUBSECTION SHALL BE FUNDED IN
THE ELECTRIC COMPANY'S DISTRIBUTION TERRITORY. EXCEPT THAT THE
UNIVERSAL SERVICE PROGRAM IN § 7-516 OF THIS SUBTITLE SHALL BE FUNDED ON A
STATEWIDE BASIS, BY A SURCHARGE OR OTHER COST RECOVERY MECHANISM THAT;

(I) FULLY RECOVERS FROM CUSTOMERS IN THE TERRITORY THE
COSTS OF THE PLANS AND PROGRAMS IN THE TERRITORY OR STATE, AS
APPROPRIATE; AND

(II) EXCEPT FOR PARAGRAPH (3) OF THIS SUBSECTION, WITH
RESPECT TO ANY OF THESE COSTS NOT INCLUDED IN RATES ON JANUARY 1, 2000, IS
NOT SUBJECT TO ANY OTHERWISE APPLICABLE RATE FREEZE OR CAP.

(3) THE RECOVERY OF COSTS BY AN ELECTRIC COMPANY FOR THE
UNIVERSAL SERVICE PROGRAM UNDER § 7-516 OF THIS SUBTITLE IS SUBJECT TO
ANY APPLICABLE CAP REGARDLESS OF WHEN THE COSTS ARE INCLUDED IN RATES.

7-513.

(A) (1) IN ACCORDANCE WITH THIS SUBSECTION, AN ELECTRIC COMPANY
SHALL BE PROVIDED A FAIR OPPORTUNITY TO RECOVER ALL OF ITS PRUDENTLY
INCURRED AND VERIFIABLE NET TRANSITION COSTS, SUBJECT TO FULL
MITIGATION, FOLLOWING THE COMMISSION'S DETERMINATION UNDER SUBSECTION
(B) OF THIS SECTION.

(2) A COMPETITIVE TRANSITION CHARGE, OR OTHER APPROPRIATE
MECHANISM THAT THE COMMISSION DETERMINES, MAY BE INCLUDED AS PART OF
THE CHARGE PAID BY EACH CUSTOMER WHO ACCESSES THE TRANSMISSION OR
DISTRIBUTION SYSTEM OF THE ELECTRIC COMPANY IN WHOSE DISTRIBUTION
TERRITORY THE CUSTOMER IS LOCATED. THE COSTS AUTHORIZED BY THE
COMMISSION TO BE RECOVERED SHALL BE ALLOCATED TO CUSTOMER CLASSES IN A
MANNER THAT, AS NEARLY AS REASONABLY POSSIBLE, DOES NOT EXCEED THE COST
OF PROVIDING THE SERVICE TO THOSE CLASSES OF CUSTOMERS, AVOIDING WHERE
REASONABLY POSSIBLE ANY INTERCLASS OR INTRACLASS CROSS SUBSIDY.

(3) THE COMPETITIVE TRANSITION CHARGE MAY BE INCLUDED ON
BILLS TO CUSTOMERS FOR A PERIOD DETERMINED BY THE COMMISSION. THE
COMMISSION MAY ESTABLISH RECOVERY PERIODS OF DIFFERENT LENGTHS FOR
EACH ELECTRIC COMPANY AND FOR DIFFERENT CATEGORIES OF TRANSITION
COSTS.

(4) (I) A COMPETITIVE TRANSITION CHARGE, OR OTHER APPROPRIATE
MECHANISM DETERMINED BY THE COMMISSION, MAY NOT BE PAID FOR ANY
ON SITE GENERATED ELECTRICITY TO THE EXTENT OF: