DR 98-174
                                     
                  Public Service Company of New Hampshire
                                     
         1999 Conservation and Load Management Pre-Approval Filing
                                     
          Order Addressing Interventions and Procedural Schedule
                                     
                         O R D E R   N O.  23,066
                                     
                             November 13, 1998

         APPEARANCES:  Gerald M. Eaton, Esq., for Public Service
     Company of New Hampshire; Gary Milbury for the New Hampshire
     Department of Environmental Services, Air Resources Division;
     Heidi L. Kroll for the Governor's Office of Energy and Community
     Services; David W. Marshall, Esq., for the Conservation Law
     Foundation; William Homeyer for the Office of the Consumer
     Advocate on behalf of residential ratepayers; and Michelle A.
     Caraway and James J. Cunningham, Jr. for the Staff of the New
     Hampshire Public Utilities Commission.
     
     
     I.   PROCEDURAL HISTORY
               On October 1, 1998, Public Service Company of New
     Hampshire (PSNH) filed with the New Hampshire Public Utilities
     Commission (Commission) its 1999 Conservation and Load Management
     (C&LM) Pre-Approval Filing in accordance with Commission Order
     No. 22,905 (April 28, 1998).  PSNH seeks approval for a C&LM
     budget of $3,206,196, of which $200,000 represents recovery of
     Lost Fixed Costs.  PSNH proposes to continue the same programs
     that were approved by the Commission by Order No. 22,905 and
     expanded by Order No. 22,999 (August 17, 1998) along with the
     addition of a New Regional Initiatives Program.  PSNH requests
     Commission approval of program modifications and funding sources. 
     PSNH currently has $1,697,196 in base rates for C&LM funding and
     is seeking additional funding of $739,000.  PSNH proposes to use
     the carry-over of unspent 1998 funding and applicable interest to
     fund the remainder of the budget.
               By an Order of Notice issued October 9, 1998, the
     Commission scheduled a prehearing conference for November 2,
     1998, 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 19, 1998, the
     Conservation Law Foundation (CLF) filed a Petition to Intervene. 
     On October 26, 1998, the Governor's Office of Energy and
     Community Services (ECS) filed a Motion for Full Intervention. 
     On October 30, 1998, the New Hampshire Department of
     Environmental Services, Air Resources Division (DES) filed a late
     Motion for Full Intervention.  There were no objections to the
     motions to intervene.  The Office of the Consumer Advocate (OCA)
     is a statutorily recognized intervenor.
               At the prehearing conference, PSNH, CLF, DES, ECS, OCA,
     and Staff modified certain dates of the procedural schedule as
     outlined in the Order of Notice.  The revised procedural schedule
     is as follows:
     
          Data Requests by Staff and            November 5, 1998 
             Intervenors
     
          Company Data Responses by noon       November 13, 1998 
     
          Technical Session                    November 16, 1998 
     
          Testimony by Staff and               November 20, 1998 
             Intervenors
     
          Data Requests by the Company         November 25, 1998 
     
          Data Responses by Staff and           December 3, 1998 
             Intervenors
     
          Settlement Conference                December 10, 1998 
     
          Filing of Settlement Agreement,      December 16, 1998 
             if any
     
          Hearing @ 1:30 p.m.                  December 21, 1998.
     
     
               At the prehearing conference, in accordance with the
     Order of Notice, PSNH, CLF, DES, ECS, OCA, and Staff stated their
     positions with regard to the filing for the record.  PSNH stated
     that it proposed to continue the same residential and commercial
     and industrial (C&I) programs as were approved for 1998 and to
     operate those programs for a complete program year.  PSNH briefly
     described the expansion of the C&LM program which was approved by
     the Commission in August 1998.  PSNH believes that approval of
     the C&LM proposal before January 1999 will allow PSNH to offer
     its programs more efficiently than it was able to in 1998.  PSNH
     stated that the funding for the C&LM program comes from existing
     rates.  PSNH requested approval for additional funding and
     authorization to use the carryover of unspent funds for 1998 with
     applicable interest to fund the remainder of the 1999 C&LM
     program.
               ECS stated that based on its preliminary review of the
     PSNH filing, it was generally supportive of the direction that
     PSNH appears to be headed with its C&LM objectives.  ECS was
     pleased to see that PSNH has proposed to continue its portfolio
     of 1998 programs with some modest modifications and including
     those programs approved by the Commission as part of the limited
     expansion in August 1998.  ECS stated that it supports PSNH's mix
     of traditional programs and market transformation initiatives
     which are made available for all its customer classes.  ECS is
     interested in getting a better understanding of the details and
     planning assumptions used to prepare the proposal.  ECS plans to
     participate in formal as well as informal information exchanges
     with PSNH and the other parties.  ECS anticipates being able to
     support the filing in general while reserving the right to
     propose modest changes as appropriate.  ECS stated that it
     supports PSNH's proposal to work with the parties and Staff to
     develop new regional initiatives with a proposed budget of
     approximately $100,000.
     
               DES stated no preliminary position at the prehearing
     conference.
               CLF stated that it agreed with a great deal of ECS'
     comments and pointed out that it suggested in the 1998 C&LM
     proceeding that PSNH's budget for C&LM should be increased
     significantly and, while the Commission did not increase funding
     for those programs as much as CLF would have liked, the direction
     the Commission took was appropriate.  CLF believes that PSNH has
     basically followed the directives the Commission laid out in
     Order No. 22,999 with this particular proposal.  CLF does not
     anticipate challenging the 1999 funding level by suggesting that
     it be raised dramatically given the Energy Efficiency Working
     Group's current discussions.  However, CLF stated that it retains
     the right to suggest certain additions to the funding and
     certainly would take the position that the budget PSNH has
     suggested is the absolute minimum acceptable to CLF.
               OCA stated that it has some general concerns regarding
     the cost-effectiveness of the proposed programs.
               Staff stated that its issues concern the recovery of
     C&LM costs, particularly with PSNH's request to increase base
     rates.  Staff believes that the filing was deficient in not
     providing the cost-effectiveness analysis and details supporting
     the proposed budget.  Staff stated it needs additional
     information regarding the traditional programs and market
     transformation initiatives that PSNH proposes to continue.  Staff
     questioned the appropriateness of Lost Fixed Costs Recovery for
     market transformation initiatives and whether PSNH should be
     entitled to recovery of Lost Fixed Costs associated with measures
     installed for new accounts.  Finally, Staff also questioned the
     existence of a cross-subsidization caused by the limited
     expansion of residential programs in August 1998 and the way the
     programs are currently being funded.
     II.  COMMISSION ANALYSIS
               We find the proposed procedural schedule, as modified
     by the parties, to be reasonable and will, therefore, approve it
     for the duration of the case.  Additionally, we will grant the
     motions to intervene filed by CLF, ECS, and DES.
               Based upon the foregoing, it is hereby 
               ORDERED, that the procedural schedule delineated above
     is APPROVED; and it is
               FURTHER ORDERED, that the motions to intervene filed by
     the Conservation Law Foundation, the Governor's Office of Energy
     and Community Services, and the New Hampshire Department of
     Environmental Services, Air Resources Division are GRANTED.
     
     
               By order of the Public Utilities Commission of New
     Hampshire this thirteenth day of November, 1998.
     
     
     
     
                                                                  
       Douglas L. Patch     Susan S. Geiger       Nancy Brockway
           Chairman           Commissioner        Commissioner
     
     
     Attested by:
     
     
                                      
     Thomas B. Getz
     Executive Director and Secretary