DR 97-241
CONNECTICUT VALLEY ELECTRIC COMPANY
Fuel and Purchased Power Adjustment Clause
Order Increasing Rates
O R D E R N O. 22,912
April 29, 1998
On December 31, 1997, the New Hampshire Public
Utilities Commission (Commission) issued Order No. 22,815 in
the above-captioned docket. Order No. 22,815 suspended
operation of Connecticut Valley Electric Company's (CVEC)
proposed 1998 fuel and purchased power adjustment clauses
(FAC and PPCA) tariff sheets pending a hearing on the issue
of CVEC's failure to terminate a wholesale purchase power
contract between CVEC and its parent company, Central
Vermont Public Service Company (CVPS). Order No. 22,815
also set an evidentiary hearing to determine the purchased
power rates that would have resulted if CVEC had terminated
the contract with CVPS, the effects on CVEC of not allowing
the proposed rate increase, and the appropriate effective
date for any new rates.
CVEC filed a motion for rehearing on January 12,
1998, which was granted in Order No. 22,838. In that Order,
the Commission allowed CVEC an additional opportunity to
present further evidence regarding the question of its
prudence in not terminating the contract with CVPS. The
hearing set by this Order started on January 28, 1998 and
was completed on February 10-11, 1998. Although the
Commission has held deliberations, a final order has not yet
issued regarding that hearing.
Prior to commencement of the hearing set by Order
No. 22,815, CVEC and CVPS filed a motion for preliminary
injunction with the United States District Court for the
District of New Hampshire, sitting in Rhode Island (District
Court), seeking to require the Commission to allow CVEC full
recovery of the RS-2 rate under the purchased power contract
with CVPS as of January 1, 1998. On April 9, 1998, the
District Court granted CVEC a preliminary injunction which
orders that CVEC be allowed to increase its rates as
proposed in its rate filing. On April 9, 1998, CVEC filed
tariff sheets and attachments to increase rates as allowed
by the Court's order. CVEC proposes to increase the FAC
rate from $0.0059 per kWh to $0.0078 per kWh and to increase
the PPCA rate from $0.0023 per kWh to $0.0239 per kWh.
Combined, the FAC and PPCA would increase rates by $0.0235
per kWh. The Commission estimates this will increase the
average homeowner's monthly bill by twenty-two percent.
The Commission has taken every step available to
it under federal procedure to protect the interests of
consumers. Specifically, the Commission has sought a stay
of the district court's injunction and is seeking to have
CVEC post a security bond for the payment of any overcharges
collected as a result of the injunction. The Commission
will also appeal issuance of the injunction to the United
States Court of Appeals for the First Circuit. But until
the order is overturned, the Commission must allow CVEC's
proposed rate increase.
The Commission will require CVEC to keep records
of the difference between the amounts that it would have
collected under its 1997 RS-2 rates and any amounts that it
collects as a result of the District Court's order. The
Commission places CVEC on notice that it will be liable for
refunds, plus interest, in the event that the District
Court's Order is overturned.
Based on the foregoing, it is hereby
ORDERED, that as ordered by the United States
District Court on April 9, 1998, Connecticut Valley Electric
Company is allowed to increase its FAC rate from $0.0059 per
kWh to $0.0078 per kWh and to increase its PPCA rate from
$0.0023 per kWh to $0.0239 per kWh effective on all bills
rendered on and after May 1, 1998; and it is
FURTHER ORDERED, that CVEC keep accurate and
complete records of the revenues that it collects as result
of the District Court's April 9, 1998 Order; and it is
FURTHER ORDERED, that CVEC shall pay refunds, plus
interest, to its customers for any overcharges collected as
a result of the April 9, 1998 District Court Order, should
that Order be overturned or modified.
By order of the Public Utilities Commission of New
Hampshire this twenty-ninth day of April, 1998.
Douglas L. Patch Bruce B. Ellsworth Susan S. Geiger
Chairman Commissioner Commissioner
Attested by:
Claire D. DiCicco
Assistant Secretary