DR 98-049
Northern Utilities, Inc.
Recovery of Environmental Response Costs
Order Approving Procedural Schedule
O R D E R N O. 22,962
June 23, 1998
APPEARANCES: LeBoeuf, Lamb, Greene & MacRae by Paul B.
Dexter, Esq. and Meabh Purcell, Esq. for Northern Utilities, Inc.
and Michelle A. Caraway and Stephen P. Frink for the Staff of the
New Hampshire Public Utilities Commission.
I. PROCEDURAL HISTORY
On April 13, 1998, Northern Utilities, Inc. (Northern)
filed with the New Hampshire Public Utilities Commission
(Commission) a Petition for Approval of an ERC Rate Adjustment
Tariff establishing a mechanism for recovery of Northern's
Environmental Response Costs (ERCs) and other related tariff
changes. ERCs are incurred in the assessment, remediation and
monitoring of Northern's former manufactured gas plants (MGP) in
New Hampshire.
Pursuant to federal and state environmental laws,
Northern is required to investigate and remediate the sites of
former MGPs in Rochester and Exeter, New Hampshire, owned and/or
operated by Northern's predecessors, on which hazardous materials
from the MGP operations have been found. The proposed recovery
mechanism is designed to recover actual annual ERC expenditures
including carrying costs over a five year period, plus one-half
of related insurance and third-party expenses and less one-half
of related insurance and third-party recoveries.
On May 11, 1998, the Commission issued an Order of
Notice which scheduled a Prehearing Conference for June 10, 1998.
The Order of Notice also set deadlines for intervention requests
and objections thereto, outlined a proposed procedural schedule,
and required the Parties and Staff to summarize their positions
with regard to the filing for the record. There were no Motions
to Intervene filed. The Office of the Consumer Advocate (OCA) is
a statutorily recognized intervenor.
After the Prehearing Conference, Northern and Staff
agreed to modify the proposed procedural schedule as outlined in
the Order of Notice. On June 16, 1998, Staff notified the
Commission of the various revisions to the procedural schedule
agreed to by Northern and Staff and also stated that the
concurrence of the OCA had been obtained. The revised procedural
schedule is as follows:
Responses to Oral Data Requests June 24, 1998
Propounded at the 1st
Technical Session
Data Requests by Staff and July 8, 1998
Intervenors
Company Data Responses July 17, 1998
Technical Session July 29, 1998
Testimony by Staff and August 12, 1998
Intervenors
Data Requests by the Company August 26, 1998
Data Responses by Staff and September 9, 1998
Intervenors
Settlement Conference September 23, 1998
Filing of Settlement Agreement, September 30, 1998
if any
Hearings October 7, 1998
& October 8, 1998.
In accordance with the Order of Notice, Northern and
Staff stated their issues with regard to the filing for the
record. Northern stated that the April 10, 1998 filing was quite
thorough and indicated that Northern was seeking approval of a
rate adjustment related to the recovery of costs associated with
remediating former MGPs. The issues pertain primarily to the
cleanup of the sites and the collection of the related costs.
Staff stated that its issues relate to whether and to
what extent remediation costs relating to the former MGPs should
be borne by utility shareholders or passed along to ratepayers;
whether the MGPs' operations were prudent; whether Northern acted
prudently and incurred reasonable costs in responding to,
investigating and remediating MGP contamination; and what the
appropriate rate scheme is to recover any Commission authorized
pass-through to ratepayers.
The OCA was not present at the Prehearing Conference.
II. COMMISSION ANALYSIS
We find the proposed procedural schedule to be
reasonable and will, therefore, approve it for the duration of
the proceeding.
Based upon the foregoing, it is hereby
ORDERED, that the procedural schedule delineated above
is APPROVED.
By order of the Public Utilities Commission of New
Hampshire this twenty-third day of June, 1998.
Douglas L. Patch Bruce B. Ellsworth Susan S. Geiger
Chairman Commissioner Commissioner
Attested by:
Claire D. DiCicco
Assistant Secretary