DR 97-211
Granite State Electric Company
1998 C&LM Program
Order Approving Stipulation
O R D E R N O. 22,818
January 2, 1998
APPEARANCES: Carlos A. Gavilondo, Esq., for Granite
State Electric Company; David W. Marshall, Esq., for the
Conservation Law Foundation; Heidi L. Kroll for the Governor's
Office of Energy and Community Services; Kenneth E. Traum for the
Office of the Consumer Advocate for residential ratepayers; and,
James J. Cunningham, Jr. and Thomas C. Frantz for the Staff of
the New Hampshire Public Utilities Commission.
I. PROCEDURAL HISTORY
On October 1, 1997, Granite State Electric Company
(GSEC or the Company) filed with the New Hampshire Public
Utilities Commission (Commission) its 1998 Conservation and Load
Management (C&LM) Program Proposal effective for the period
January 1, 1998 through December 31, 1998. The filing proposes
to maintain GSEC's overall C&LM budget at $2.01 million. This is
the same level as approved for the 1997 program year.
By Order of Notice issued October 14, 1997, the
Commission scheduled a prehearing conference for October 23,
1997, set deadlines for intervention requests and objections
thereto, outlined a procedural schedule, and required the Parties
and Commission Staff (Staff) to summarize their positions with
regard to the filing for the record. On October 21, 1997, the
Conservation Law Foundation (CLF) filed a Motion to Intervene.
On December 5, 1997, the Governor's Office of Energy and
Community Services (Governors' Energy Office) filed a motion to
intervene. There was no objection to these motions to intervene
and the Commission granted the motions. The Office of Consumer
Advocate (OCA) is a statutorily authorized intervenor.
At the prehearing conference, GSEC, CLF and Staff
agreed to the proposed procedural schedule as modified by a
change in the date for the final hearing which was reset to
December 12, 1997. In accordance with the Order of Notice, GSEC,
CLF and Staff stated their positions with regard to the filing
for the record.
On October 27, 1997, Staff propounded sixty-three
written data requests upon the Company related to the 1998
program proposal. The Company served its responses to these data
requests on November 4, 1997. On November 7, 1997, GSEC, CLF and
Staff participated in a technical session. On November 12, 1997,
the Company served its responses to three additional information
requests made by Staff at the technical session. The Company did
not propound any data requests with respect to the testimony
filed by Staff on November 20, 1997. No intervenors filed
testimony.
On December 2, 1997, the Parties and Staff participated
in a settlement conference. As a result of negotiations between
GSEC, CLF and Staff, a settlement was reached which resolves all
remaining issues in this docket. The OCA and Governor's Energy
Office did not participate in negotiations but the Governor's
Energy Office submitted written comments on December 12, 1997.
II. STIPULATION
The following summarizes what was agreed to by GSEC,
CLF and Staff:
A. Regarding the overall proposal, GSEC shall implement its 1998
C&LM program as set forth in the Company's proposal filed October
1, 1997, subject to the modifications, provisions and
stipulations set forth in this Settlement. The Company's 1998
C&LM Program as set forth in this Settlement shall be effective
January 1, 1998.
B. Regarding the program budget, the Company's overall 1997 C&LM
program budget shall be $2.011 million, which is comprised of
$1,510,500 for Commercial/Industrial (C/I) programs, and $500,700
for residential programs. This is the same overall budget amount
proposed in the October 1, 1997 filing, as well as the overall
budget level approved by the Commission with respect to GSEC's
1997 program (see Order No. 22,518). The 1998 budget associated
with each specific program, the values associated with each
program, and the projected 1998 Company incentives and customer
dividends are set forth in Attachment 1 to the Settlement.
C. Regarding Residential Programs, the Company will voluntarily
withdraw from consideration as part of its proposed 1998
Residential Program portfolio the Efficient Clothes Washer
program and ENERGY STAR program. Withdrawal of these programs
shall be without prejudice to any party to this Settlement and
shall not preclude the Company or any other party from proposing
these programs, or similar ones, in any future proceeding.
Budget amounts originally proposed for the withdrawn programs--$8,600 and $45,600 for Efficient Clothes Washers and ENERGY STAR,
respectively--will be reallocated to the 1998 Energy Wise Program
budget.
The Company shall be permitted to implement a Low Income
conservation program as proposed in the October 1, 1997 filing;
provided, however, that the program shall be modified to
eliminate the waterbed mattress replacement aspect of the
program. The Parties and Staff anticipate that the Low Income
conservation program will be transitioned into the larger low
income program established by the Commission in its Final Plan on
industry restructuring once that large program is in place in the
retail choice environment. GSEC shall file a plan to implement
said transition (including any necessary adjustments to the
Company's C&LM adjustment factor) not less than 30 days prior to
the commencement of collection of any low income surcharge from
the Company's customers pursuant to retail choice program.
With respect to the Residential Lighting program, the
Company agrees to reduce the rebate levels for compact florescent
lights from $10 per unit as proposed in the October 1, 1997
filing to $8 per unit. The $8 rebate level represents a
reduction of over 38% from the rebate level in the 1997 Program.
The budget for the Residential Lighting program will be
correspondingly adjusted to reflect the reduced rebate level and
the anticipated effect on program participation. The amount by
which the Residential Lighting Program budget is reduced shall be
reallocated to the 1998 Energy Wise Program budget.
Individual program budget levels shall be as set forth in
Attachment 1, and the Residential program C&LM adjustment factor
shall be as set forth in Section II.F, below.
D. Regarding C/I programs, these programs shall be implemented
as proposed by the Company in the October 1, 1997 filing.
Individual program budget levels shall be as set forth in
Attachment 1, and the C/I C&LM adjustment factor shall be as set
forth in Section II.F, below.
E. Regarding C&LM costs recovered through NEP's Rates, the
Parties acknowledge that a portion of the costs of the Company's
C&LM program is currently incurred by GSEC through its wholesale
power charges from New England Power Company (NEP) and recovered
from ratepayers through the Purchased Power Adjustment Clause
(PPCA). Those costs relate to the planning, evaluation and
administration of the program, which are done on a system basis
to achieve the best overall results for NEP's all-requirements
customers, as well as to programs designed to provide load
management benefits best achieved at the NEP level, e.g. Home
Energy Management (HEM) and Cooperative Interruptible Program
Credits (CIS Credits). The Parties agree that upon the
termination of the NEP contract with GSEC as a result of the
implementation of supplier choice for GSEC ratepayers, such costs
will be incurred directly by GSEC and are appropriately
recoverable from ratepayers as a part of the C&LM factor.
Attachment 2, hereof is a copy of the Company's response to data
request DR-STAFF-61 and provides information with respect to
these costs.
Accordingly, in the event that retail choice is available in
GSEC service territory before the end of 1998, the Parties agree
that as part of the necessary filing GSEC will make to implement
customer choice, it shall be permitted to increase the C&LM
factor no less than 30 days prior to the implementation of retail
choice in order to enable Commission review and verification of
the costs to be transferred. Any such increase in the factor
shall be designed to recover no more than the pro rata share of
NEP-related costs currently reflected in rates, which is
approximately $340 thousand per year; provided, however, that no
such costs may be recovered with respect to programs which may no
longer be in effect after the start of customer choice, e.g., HEM
and CIS Credits. The effect of transferring recovery of the NEP-related costs from the PPCA to the C&LM factor will be to
increase the factor in Section II.F, below; as well as the budget
levels in Section II.B, above. However, in no event will the
transfer of recovery to the C&LM factor upon the implementation
of retail choice result in any greater per unit recovery of C&LM
costs than shall be recovered prior to choice through the C&LM
factors and the PPCA. The Parties agree that the recovery of
such costs through the C&LM factor as a part of the 1998 program
shall establish no precedent with respect to future C&LM programs
GSEC may propose or future recovery of such costs.
F. Regarding the C&LM Adjustment Factors, the 1998 Residential
C&LM Factor shall be $0.00133 per kWh and the 1998 C/I Factor
shall be $0.00398 per kWh, effective January 1, 1998. These
factors support the 1998 program budgets as set forth in Section
II.B, above, and include the Company's 1997 maximizing and
efficiency incentives, subject to evaluation and reconciliation
to actual performance. These factors shall remain in effect
throughout the 1998 program year, subject to the adjustments set
forth in Sections II.C and II.E, above.
Pursuant to the Commission's authority under N.H. Admin.
Rules, Puc 201.05, the Parties and Staff request waiver of PUC
1203.05(a), which requires that rate changes generally be
implemented on a service-rendered basis, and instead permit GSEC
to implement the 1998 C&LM adjustment factors on a bills-rendered
bases consistent with the principles embodied in PUC 1203.05(b).
The calculation of each 1998 factor is shown in Schedule PTZ-1 of
the October 1, 1997 filing.
III. COMMISSION ANALYSIS
Having carefully reviewed the Stipulation, supporting
testimony and exhibits provided at the December 12, 1997 hearing,
we find that GSEC's proposed 1998 C&LM programs, as modified by
the Stipulation, are reasonable and in the public good.
The Commission believes that it is appropriate, at this
time, to postpone implementation of the Efficient Clothes Washer
program and the Energy Star program in order to examine, more
carefully, the benefits and costs associated with these programs.
Regarding the 1997 maximizing and efficiency incentives, the
Commission understands that these incentives are subject to
reconciliation based on actual performance.
Regarding the transfer of NEP costs to GSEC (e.g.,
costs related to the HEM and CIS programs, currently incurred by
NEP and included in GSEC's PPCA), the Commission understands that
the settlement agreement requires the Company to propose and the
Commission approve, as appropriate, any recovery of C&LM costs
transferred from NEP, provided that no such costs may be
recovered with respect to programs which may no longer be in
effect after the start of customer choice, such as the HEM and
CIS programs, and that all such costs will be the subject of a
proposal by GSEC which will be filed no less than 30 days prior
to the implementation of retail choice.
Regarding the waiver of PUC 1203.05(a), the Commission
will waive the requirement that rate changes generally be
implemented on a service-rendered basis and permit GSEC to
implement the 1998 C&LM adjustment factors on a bills-rendered
basis. The Commission believes that such waiver, pursuant to Puc
201.05, would be in the public interest.
Based upon the foregoing, it is hereby
ORDERED, that the proposed C&LM programs, as amended by
the Stipulation, are hereby APPROVED; and it is
FURTHER ORDERED, that GSEC's 1998 C&LM adjustment
factors be effective January 1, 1998 on a bills-rendered basis;
and it is
FURTHER ORDERED, that GSEC file compliance tariff pages
within ten days of the date of this order.
By order of the Public Utilities Commission of New
Hampshire this second day of January, 1998.
Douglas L. Patch Bruce B. Ellsworth Susan S. Geiger
Chairman Commissioner Commissioner
Attested by:
Thomas B. Getz
Executive Director and Secretary