DR 98-096
CONCORD ELECTRIC COMPANY and EXETER & HAMPTON
ELECTRIC COMPANY
Fuel Adjustment Clause and Purchased Power Adjustment
Clause
Order Approving Charges
O R D E R N O. 22,966
June 29, 1998
APPEARANCES: LeBoeuf, Lamb, Greene & MacRae by
Scott J. Mueller, Esq. on behalf of Concord Electric Company
and Exeter & Hampton Electric Company; and Henry J. Bergeron
and Todd M. Bohan for the Staff of the New Hampshire Public
Utilities Commission.
I. PROCEDURAL HISTORY
On June 1, 1998, Unitil Service Corporation,
(Unitil), on behalf of Concord Electric Company (CEC) and
Exeter & Hampton Electric Company (E&H) (collectively the
Companies), filed with the New Hampshire Public Utilities
Commission (Commission) revised tariff pages, supporting
testimony, and exhibits for proposed revisions to the
Companies' retail fuel adjustment clauses (FAC) and
purchased power adjustment clauses (PPAC) and short-term
purchased power rates for qualifying facilities (QFs) for
the period of July 1, 1998 through December 31, 1998.
II. POSITIONS OF THE PARTIES AND STAFF
A. The Companies
Unitil presented calculations supporting CEC's
request for a FAC credit of ($0.00425) per kWh and a PPAC
charge of $0.00276 per kWh. The combined effect of the two
rates is to decrease a typical 500 kWh residential
customer's bill by $3.45 per month, or 6.24%.
Unitil also presented calculations in support of
E&H's request for a FAC credit of ($0.00407) per kWh and a
PPAC charge of $0.00266 per kWh. The combined effect of the
two rates is to decrease a typical 500 kWh residential
customer's bill by $5.06 per month, or 9.23%. Unitil witness Scott A. Long, Senior Energy
Analyst for Unitil Service Corp., presented the July 1998
through December 1998 Unitil Power Corporation (UPC)
production plan, associated costs, and estimated short-term
avoided cost rate in his direct testimony. The UPC
production plan is the basis for UPC's fuel, purchased
power, and transmission service costs, and is used in
developing UPC's wholesale rates which it charges CEC and
E&H under the Unitil System Agreement for firm service.
UPC's demand charge is $22.01/kW-Month, the base
energy charge is $0.0057/kWh, and the fuel charge is
$0.02069/kWh. The demand charge is decreasing from
$26.35/kW-Month primarily due to an anticipated over
recovery on June 30, 1998. This over recovery was caused by
lower than expected refueling and outage costs associated
with major unit outages occurring in the period, lower than
forecast capacity costs associated with cost of service
contracts, and lower than forecast short-term capacity
costs.
The base energy charge is decreasing from
$0.00632/kWh due to an over recovery associated with
unplanned outages of the Seabrook and Bay State Agawam
units. Since the plants did not run as planned, lower than
expected costs were realized.
The fuel charge is decreasing due primarily to low
projected oil prices and the effect of no significant
outages to major units over the July 1, 1998 to December 31,
1998 filing period. Oil prices are expected to remain at
current low levels over the summer period and are projected
to rise slightly toward the last part of the year.
UPC's proposed rates represent a 16.45% decrease
in demand charges (from $26.35 to $22.01), a decrease of
9.69% in base energy charges (from $0.00632 to $0.00570),
and a decrease in fuel charges of 7.9% (from $0.02247 to
$0.02069).
In her prefiled testimony, Linda S. Hafey, Project
Leader of Regulatory Operations for Unitil Service Corp.,
provided an explanation of the Companies' Mitigation
Proceeds Credit (MPC), the Sales Margin Retention Credit
(SMRC), and the Participation Incentive Credit (PIC) as well
as the Non-Participant Protection Adjustment (NPA) for the
Retail Competition Pilot Program. This included an
explanation of how the NPA protects non-participating
customers from unrecovered power supply costs due to
customer participation in CEC's and E&H's Retail Competition
Pilot Program.
The Companies also filed revised tariffs for
short-term power purchase rates for Qualifying Facilities as
follows:
Energy Rates on Peak 3.04 cents per kWh
Off Peak 2.22 cents per kWh
All Hours 2.53 cents per kWh
Capacity Rates $0.00 per kW-year
B. Commission Staff
Staff did not provide testimony or oppose the
Companies' filings but did conduct cross examination on a
number of issues: 1) the causes of the reductions in the
demand charges, 2) the erroneous billing by ISO-New England
to Public Service Company of New Hampshire which was later
correctly billed to UPC, 3) the impact on the Companies of
the Maine Yankee shutdown, and 4) the projected growth
figures for the year 1998 over 1997.
III. COMMISSION ANALYSIS
We have reviewed all the testimony and exhibits in
this case, including the responses provided by the
Companies. Based on our review of the record, we find that
the FAC for the July 1, 1998 through December 31, 1998
period will be a credit of ($0.00425) per kWh for CEC and a
credit of ($0.00407) per kWh for E&H. For the same period,
the PPAC will be $0.00276 per kWh for CEC and $0.00266 per
kWh for E&H. For a typical CEC residential customer using
500 kWh per month, the net result of the FAC and PPAC
changes is a $3.45 decrease to the monthly bill. For a
typical E&H residential customer using 500 kWh per month,
the net result of the FAC and PPAC changes is a $5.06
decrease to the monthly bill.
We find that the proposed short-term avoided
capacity and energy rates are just and reasonable.
Based upon the foregoing, it is hereby
ORDERED, that Concord Electric Company's Fuel
Adjustment charge for the period of July 1, 1998 through
December 31, 1998, shall be a credit of ($0.00425) per kWh
while its Purchased Power Adjustment charge shall be
$0.00276 per kWh; and it is
FURTHER ORDERED, that Exeter & Hampton Electric
Company's Fuel Adjustment charge for the period of July 1,
1998 through December 31, 1998, shall be a credit of
($0.00407) per kWh while its Purchased Power Adjustment
charge shall be $0.00266 per kWh; and it is
FURTHER ORDERED, that Concord Electric Company and
Exeter & Hampton Electric Company file revised tariff pages
in compliance with this order on or before July 13, 1998.
By order of the Public Utilities Commission of New
Hampshire this twenty-ninth day of June, 1998.
Douglas L. Patch Bruce B. Ellsworth Susan S. Geiger
Chairman Commissioner Commissioner
Attested by:
Thomas B. Getz
Executive Director and Secretary