§ 301-d. Utility credit or reimbursement. (a) Gallonage eligible for
credit or reimbursement. An electric corporation, as defined in
subdivision thirteen of section two of the public service law, subject
to the supervision of the department of public service, shall be
entitled to a credit against the tax imposed by section three hundred
one-a of this article or a reimbursement of such tax with respect to the
following gallonage:

(1) Credit. Residual petroleum product and non-highway diesel motor
fuel (i) imported into this state by such electric corporation which is
a petroleum business where the tax liability under section three hundred
one-a of this article is imposed on such electric corporation and where
the residual petroleum or non-highway diesel product so imported is used
by such electric corporation to fuel generators for the purpose of
manufacturing or producing electricity or (ii) purchased in this state
by such electric corporation by the use of a valid direct payment permit
whereby such electric corporation assumed full liability for tax with
respect to such product where such product so purchased is used by such
electric corporation to fuel generators for the purpose of manufacturing
or producing electricity.

(2) Reimbursement. Residual petroleum product and non-highway diesel
motor fuel purchased in this state by such electric corporation where
the tax imposed by section three hundred one-a of this article with
respect to such residual petroleum or diesel product was paid and the
utility absorbed such tax in the purchase price of such fuel and where
such product is used by such electric corporation to fuel generators for
the purpose of manufacturing or producing electricity.

(b) Calculation. The amount of the credit or reimbursement shall be
determined by multiplying the gallonage of the residual petroleum
product eligible for the credit or reimbursement times the basic credit
or reimbursement per gallon of two and ninety-eight hundredths cents and
by multiplying the gallonage of all diesel product eligible for credit
or reimbursement times the basic credit or reimbursement per gallon of
three cents. The basic credit or reimbursement per gallon for residual
petroleum product and diesel product shall be adjusted at the same time
and in the same manner as set forth in subdivisions (f) and (g) of
section three hundred one-a of this article for the motor fuel and
diesel motor fuel rate and the residual petroleum product rate. All the
provisions of subdivision (h) of such section shall apply to such
adjusted credit or reimbursement and such adjusted credit or
reimbursement shall be published at the same time and in the same manner
as such rates are published. The credit or reimbursement determined
pursuant to this section shall be rounded to the nearest one-hundredth
of a cent. Provided, however, that on April first, nineteen hundred
ninety-nine, there shall be added to the basic credit or reimbursement
amount, with respect to both residual petroleum product and diesel
product, as then adjusted and in effect, the amount of one-half cent. On
the immediately following first day of January and each January
thereafter, there shall be added to the basic credit or reimbursement
amount, with respect to both residual petroleum product and diesel
product, as then adjusted and in effect on such date (determined with
respect to the basic credit or reimbursement amount only, without
reference to such one-half cent), the amount of one-half cent.

(c) Application of the credit or reimbursement. The credit shall be
applied against liability for tax under this article for the same period
during which the credit arose. Any excess may then be applied to tax
liability under this article for subsequent periods.

(d) Any reimbursement of tax may be applied for not more often than
monthly. An electric corporation entitled to reimbursement under this
section, in lieu of such reimbursement, may take credit therefor on a
return filed under this article.