DR 97-212
GRANITE STATE ELECTRIC COMPANY
Cooperative Interruptible Service Compliance Filing
Order Nisi Approving Update of Cooperative Interruptible Service
Credits and Non-Compliance Charges for the 1997/98 Program Year
O R D E R N O. 22,889
March 30, 1998
On October 1, 1997, Granite State Electric Company
(Granite State or the Company) filed with the New Hampshire
Public Utilities Commission (Commission) an update of the short-term value of capacity and a review of the long-term value of
capacity used to calculate customer credits in Granite State's
Cooperative Interruptible Service (CIS) Program. The Company's
CIS Program provides credits to large commercial and industrial
customers based on the customer's ability and willingness to
interrupt load as requested by Granite State during capacity
shortages. Under the Settlement Agreement between Granite State
and Commission Staff (Staff) approved by Order No. 20,684
(November 30, 1992) in Docket DR 92-188, Granite State is
required to file updated short-term and long-term avoided costs
and to recalculate the credits on or before October 1st of each
year.
Granite State's CIS program consists of two types of
contracts, CIS-1 and CIS-2. Through CIS-1, a customer commits to
a firm interruptible load level with a seven year notice of
termination provision, is paid regardless of whether or not an
interruption actually occurs and is penalized in the event that
an interruption is called and the customer fails to comply.
CIS-2 does not require a commitment for a firm interruptible load
level by the customer. Rather, the contract is performance-based, with higher credits paid in months when the company
requests an interruption and the customer agrees to the request.
Both contracts offer three options which differ in terms of
frequency, duration and interruption notification period. A
different credit is paid for each option.
In its October 1, 1997 filing, Granite State updated
the data on program expenses and the total credited interruptible
load to calculate new program cost factors which were then used
to update the credit calculations. The long-term avoided cost
value, used in establishing the credit levels in CIS-1 contracts,
remained unchanged from 1996/97 at a level of $65.10 per kW.
Granite State proposes two changes to its CIS Programs. First,
the Company proposes to close the CIS-1 Program to any new
customers. Second, the Company proposes eliminating the CIS-2
Program in its entirety. Granite State recommends these changes
on the basis of impending retail access, under which the Company
will not, with the exception of default power, be selling
electricity to its customers.
Granite State proposes the following credits
($/kW-Month) and non-compliance charges ($/kW-Day), depending
upon which option the customer chooses. The proposed CIS-1
credits and non-compliance charges are approximately 2 percent
higher than the 1996/97 charges.
CIS-1
Non-Compliance
Credit Charge
Option 1 $ 4.33 $ 5.20
Option 2 $ 4.75 $ 5.70
Option 3 $ 3.25 $ 3.90
On February 13, 1998, Staff issued data requests to
Granite State requesting additional information regarding the
Company's CIS Program filing. On February 20, 1998, the Company
filed responses which served to clarify issues about Granite
State's CIS Program expenses.
The Commission has reviewed Granite State's filing and
will approve the updated avoided costs, credits and non-compliance charges. We find that the credits have been
calculated in accordance with the formulas approved in Order No.
20,684. We are satisfied that Granite State's CIS-1 Program
continues to provide value to the Company and its ratepayers as
the industry makes the transition to increased competition and
that the updated avoided costs and resulting credits are
reasonable. We find that elimination of the CIS-2 Program will
not impact current ratepayers because Granite State has no
customers in the CIS-2 Program. We further find that elimination
of the CIS-2 Program is consistent with the Commission's efforts
to move forth with retail choice.
Based upon the foregoing, it is hereby
ORDERED NISI, that Granite State's request for approval
of its updated CIS-1 Credits and elimination of the CIS-2 Program
is GRANTED; and it is
FURTHER ORDERED, that pursuant to N.H. Admin. Rules,
Puc 1601.05, Granite State shall cause a copy of this Order Nisi
to be published once in a statewide newspaper of general
circulation, such publication to be no later than April 6, 1998
and to be documented by affidavit filed with this office on or
before April 13, 1998; and it is
FURTHER ORDERED, that Granite State serve a summary of
its proposed rate change and a copy of this Order Nisi on all
current CIS-1 and CIS-2 customers by first class U.S. Mail,
postmarked no later than April 13, 1998; and it is
FURTHER ORDERED, that all persons interested in
responding to this petition be notified that they may submit
their comments or file a written request for a hearing on this
matter before the Commission no later than April 20, 1998; and it
is
FURTHER ORDERED, that any party interested in
responding to such comments or request for hearing shall do so no
later than April 27, 1998; and it is
FURTHER ORDERED, that this Order Nisi shall be
effective April 30, 1998, unless the Commission provides
otherwise in a supplemental order issued prior to the effective
date; and it is
FURTHER ORDERED, that Granite State shall file a
compliance tariff with the Commission on or before April 30,
1998, in accordance with N.H. Admin. Rules, Puc 1601.04(b).
By order of the Public Utilities Commission of New
Hampshire this thirtieth day of March, 1998.
Douglas L. Patch Bruce B. Ellsworth Susan S. Geiger
Chairman Commissioner Commissioner
Attested by:
Thomas B. Getz
Executive Director and Secretary