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wECE VED
OCT 2 5 1993
DIVIS:0N OF E; ‘ERCY/DCRA
Before Commissioners: Don Schr6er, Chairman
Susan M. Knowles
Daniel Patrick O’Tierney
Mark A. Foster
James E. Carter, Sr.
In the Matter of the Consideration
of Standards for Approval of Whole-
sale Power Contracts as Required by
Section 712 of the Energy Policy Act
of 1992
R-93-4
ORDER NO. 2 ri nae ae aah ac Ras
ORDER DECLINING TO ADOPT ADDITIONAL STANDARDS FOR APPROVAL OF WHOLESALE POWER AGREEMENTS; ALLOCATING COSTS; AND CLOSING DOCKET
BY THE COMMISSION:
Introduction
In October 1992, Congress passed and the President
signed, the Energy Policy Act of 1992 (EPAct), a comprehensive
_ energy bill. The Public Utility Regulatory Policies Act of 1978
. (PURPA)? required state regulatory commissions to consider and
‘|
‘ make determinations regarding certain federal energy standards.?
The EPAct added four standards to be considered by state
:, regulatory commissions.
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116 USCA §2621(a).
216 USCA §2621(d) (10) (i) through (iv).
R-93-4(2) - (10/21/93) CC. We ,
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Alaska Public Utilities Commission 1016 West Sixth Avenue, Suite 400 Anchorage, Alaska 99501 (907) 276-6222 10
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By Order R-93-4(1), dated September 10, 1993, The
Commission opened this Docket to address these standards and to
inquire whether a rulemaking proceeding was either appropriate or
necessary. As noted in Order No. 1 in this proceeding, Sections
111 and 115 of EPAct require the Commission to determine whether
it should adopt standards related to Integrated Resource Planning.
‘That issue will be addressed in a separate proceeding.
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Section 712 of EPAct mandates that any state regulatory
authority, which requires or allows electric utilities to consider
the purchase of long-term wholesale power supplies as a means of
‘meeting electric demand, must perform, within one year of the
| passage of EPAct,? a general evaluation of the following:
1. the potential for increases or decreases in
the costs of capital for electric utilities entering
into long-term wholesale power contracts (contracting
utilities) and any resulting increases or decreases in
the retail rates paid by electric consumers that may
result from purchases of long-term wholesale power
supplies in lieu of the construction of new generation
facilities by these utilities;
316 USCA §2621(d) (10) (E) provides that "each State regulatory
authority shall consider and make a determination concerning
‘whether it is appropriate to implement the standards set out in
subparagraph (A) not later than one year after October 24, 1992."
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Alaska Public Utilities Commission 1016 West Sixth Avenue, Suite 400 Anchorage, Alaska 99501 (907) 276-6222 10
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2. whether the use by exempt wholesale generators
(EWGs) * of capital structures that employ
proportionately greater amounts of debt than capital
structures of contracting utilities threatens
reliability or provides an unfair advantage for EWGs
over such utilities;
3. whether procedures should be implemented for
the advance approval or disapproval of long-term whole-
sale power supply contracts; and
4. whether reasonable assurances of fuel supply
adequacy should be required as a condition for the
approval of the purchase of power.
The Commission noted that Section 712 of the Act
requires an evaluation of the aforementioned issues, not the
adoption of specific rules or other affirmative act.
In Order No. 1 the Commission observed that current
state statutes require its prior approval of wholesale power
agreements. > The Commission’s review of wholesale power
agreements typically encompasses a variety of elements, including
‘the following: (1) the potential for increases or decreases in
the cost of capital for the purchasing utility, as well as the
4EWG’s are exempt from the regulatory provisions of the
Public Utility Holding Company Act of 1935.
5AS 42.05.431(b) provides, in pertinent part, "A wholesale
power agreement between public utilities is subject to advance
approval of the commission. ..."
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resultant increases or decreases in retail rates; and (2) the
: stability and adequacy of the fuel supply source. The Commission
has exercised its statutory authority with respect to wholesale
power agreements.
As to EWGs, the Commission concluded that there are no
: such generators in Alaska at the present time nor does there
appear to be any plans for EWG development in the foreseeable
' future.
The Commission scheduled a public hearing for October
'1, 1993, to accept testimony on the issue of whether additional
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formal standards should be adopted for wholesale power agreements.
The Commission also provided for the submission of written
comments no later than October 15, 1993. Finally, the Commission
scheduled a special public meeting for October 21, 1993, to
determine what action, if any, should be taken in response to
‘Section 712 of EPAct.
The public hearing was held as scheduled. No members
of the public appeared, and no comments were entered on the
record.
On October 14, 1993, the Commission received written
comments from Golden Valley Electric Association, Inc. (GVEA).
‘' GVEA concurs with the Commission’s conclusion that EPAct does not
require any specific legislative or Commission action on the
evaluation conducted pursuant to Section 712.
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Alaska Public Utilities Commission 1016 West Sixth Avenue, Suite 400 Anchorage, Alaska 99501 (907) 276-6222 10
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Further, GVEA asserts that the first two questions
presented by Section 712 of EPAct are not relevant to Alaska
because the majority of Alaskan consumers receive their power from
cooperative utilities rather than investor-owned utilities.
Moreover, the competitive relationship between utilities and
independent power producers is not a factor in Alaska because no
independent power producers have undertaken generation projects.
GVEA also asserts that the final two questions presented
by Section 712 of EPAct have been resolved in Alaska through the
Commission’s exercise of its statutory authority. GVEA concludes
that the present statutory scheme is sufficient and that the
adoption of additional regulations is unnecessary and unwarranted
and would, in fact, create unnecessary complications and unduly
| interfere with each utility’s ability to negotiate individual
', power sales agreements to suit its needs.
On October 15, 1993, Chugach Electric Association, Inc.
" (Chugach) , filed comments that generally agree with the Commis-
|; Sion’s conclusion that further action is unnecessary. In
‘addition, Chugach raises the issue of whether the Commission is
,utilities because Alaska’s electric utilities may not have
|| sufficient involvement in interstate commerce to fall within the
if
| purview of federal jurisdiction.
On October 15, 1993, the Commission also received
_written comments from the Alaska Rural Electric Cooperative
R=93=4 (2)—=— (210/721, /93)
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‘ Association, Inc. (ARECA). ARECA asserts that the Commission,
:under its established practices and procedures, gives due
consideration to the factors listed in EPAct during the course its
‘| approval of wholesale power agreements. Accordingly, ARECA argued
' chat further rulemaking is unnecessary.
The Commission Staff (Staff) submitted its analysis and
‘| recommendation regarding EPAct to the Commission on October 20,
1993. Staff stated that Commission currently has mechanisms in
| place to review wholesale power agreements which address rates and
leo designed to protect the financial health of the parties to the
‘| transaction. Therefore, Staff recommended that the Commission
; reject the adoption of additional standards for wholesale power
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\ aeeeraio permit Chugach to brief the issue of federal
| || Jurisdiction in subsequent EPAct proceedings, and close the
|| docket.
No other written comments were received by the
\ '| Commission.
On October 21, 1993, the Commission held a special
| public meeting to decide whether to adopt additional rulemaking
| Standards regarding wholesale power contracts.
Discussion
After review of the comments filed by ARECA, Chugach,
GVEA, and Staff, the Commission affirms the tentative
-conclusion(s) reached in Order R-93-4(1).
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First, EPAct does not require any specific legislative
or Commission action. Second, the Commission has appropriately
inquired into the issue of whether it shotld adopt additional
= or standards related to wholesale powex agreements through
the public hearing and written comment processes.
Third, the Commission’s exercise of its state statutory
authority affords sufficient protection t9 both purchasing
utilities and retail consumers regarding the relevant factors
listed in Section 712 of EPAct. Any further review of wholesale
power agreements is neither relevant to Alaska nor necessary at
this juncture.
Fourth, the Commission does not address the issue of
whether the federal government has jurisdiction to mandate the
‘Commission to comply with EPAct. However, Chugach and any other
parties to subsequent EPAct proceedings are invited to submit
legal briefs addressing this issue.
i Finally, EPAct sets forth the manner in which each state
I regulatory authority shall comply.® The Commission has conducted
! a public hearing after adequate notice and gave the public an
| opportunity to submit written comments, as well. The Commission’s
|;decision has been reduced to writing in this Order which shall
Hi |
§16 USCA 2621(b)(1) provides "(T]he consideration referred
‘ito in subsection (a) of this section shall be made after public
aes and hearing. The determination referred to in subsection
'| (a) of this section shall be -- (A) in writing, (B) based upon
|| findings included in such determination and upon the evidence
|} presented at the hearing, and (C) available to the public." i } i
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remain in the Commission’s public files. And finally, this Order
is being issued prior to October 23, 1993. Therefore, the
Commission concludes that its actions are in full compliance with
i EPAct. A copy of this decision will be forwarded to the
| appropriate federal agency prior to the statutory deadline.
Inasmuch as the outstanding substantive issues in Docket
') R-93-4 has been resolved, the only remaining issue in the
i proceeding is the allocation of costs under currently applicable
‘law. AS 42.05.651 and 3 AAC 48.157. The allocable costs incurred
in Docket R-93-4 were for court reporting services and newspaper
|| publication in the amount of $751.84. Inasmuch as Docket R-93-4
; was an inquiry regarding future rulemaking proceedings, the costs
| will be borne by the Commission. Accordingly, Docket R-93-4 is
i closed.
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{ |
ORDER
\\ THE COMMISSION FURTHERS ORDERS:
1. No further wholesale power agreement standards shall
|! be adopted responsive/relative to Section 712 of Energy Policy Act
of 1992.
2. The allocable costs of Docket R-93-4 will be borne
by the Commission.
R-93-4(2) - (10/21/93) Page 8 of 9
Alaska Public Utilities Commission 1016 West Sixth Avenue, Suite 400 Anchorage, Alaska 99501 (907) 276-6222 3.
DATED AND EFFECTIVE at Anchorage, Alaska, this 21st day of Octo-
ber, 1993.
Docket R-93-4 is closed.
BY DIRECTION OF THE COMMISSION
(Commissioners Susan M. Knowles and
Mark A. Foster, not participating)
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R-93-4(2) -
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(10/21/93)
Alaska Public Utilities Commission 1016 West Sixth Avenue, Suite 400 Anchorage, Alaska 99501 (907) 276-6222 10
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STATE OF ALASKA
THE ALASKA PUBLIC UTILITIES COMMISSION
‘| Before Commissioners: Don Schréer, Chairman
i| Susan M. Knowles
7 Daniel Patrick O’Tierney 4 Mark A. Foster James E. Carter, Sr.
|,In the Matter of the Consideration
||}of Standards for Approval of
|Wholesale Power Contracts as
‘|}Required by Section 712 of the
:; Energy Policy Act of 1992
R-93-4 wee ever vw i: CERTIFICATION OF MAILING
I, TAMARA M. ALEXANDER , certify as follows:
I am a Documents Processor IV_ in the offices of the Alaska
| Public Utilities Commission, 1016 West Sixth Avenue, Suite 400,
| Anchorage, Alaska 99501.
On October _22_, 1993, I mailed copies of
ORDER NO. 2, entitled:
ORDER DECLINING TO ADOPT ADDITIONAL STANDARDS
FOR APPROVAL OF WHOLESALE POWER AGREEMENTS;
ALLOCATING COSTS; AND CLOSING DOCKET
(Issued October 21, 1993)
| | |
i
i ' in the proceeding identified above to the persons indicated on the
‘tattached service list.
‘DATED at Anchorage, Alaska, this 22nd day of October, 1993.
Utrn-wre:. Y- AtiyanAs.
TAMARA M. ALEXANDER
»R-93-4(2) - (Certification of Mailing)
Page 1 of 1
SERVICE LIST
R-93-004
Jeffrey D. Landry, Esq.
Assistant Attorney General
Alaska Public Utilities Commission
1031 West Fourth Avenue, Suite 200
Anchorage, AK 99501
Steve Baden
Chief, Affordable Housing and
Energy Efficiency
Alaska Housing Finance Corporation
520 East 34th
Anchorage, AK 99503-4199
James S. Webb
President and General Manager
Alaska Electric Light and Power Co.
612 West Willoughby Avenue
Juneau, AK 99801-1798
Robert S. Grimm
President
Alaska Power & Telephone Co. and
Bettles Light & Power, Inc.
P. O. Box 222
Port Townsend, WA 98368
October 22, 1993
Page 1 of 6
Robert E. Stoller, Esq.
800 East Dimond Boulevard, Suite 3-640
Anchorage, AK 99515
Robert L. Hufman
General Manager :
Alaska Electric Generation and
Transmission Cooperative, Inc.
P. O. Box 169
Homer, AK 99603
Ronald A. Garzini
Executive Director
Alaska Energy Authority
P. O. Box 190869 Anchorage, AK 99519-0869
David Hutchens
Executive Director
Alaska Rural Electric Cooperative
Association, Inc.
703 West Tudor, Suite 200
Anchorage, AK 99503
SERVICE LIST (CONTINUED)
R-93-004
Charles Y. Walls
General Manager
Alaska Village Electric Cooperative, Inc.
4831 Eagle Street
Anchorage, AK 99503
Thomas M. Dow
Vice President of Operations
Arctic Utilities, Inc.
1001 East Benson Boulevard
Anchorage, AK 99508-4256
Harold A. Borrego
President
Bethel Utilities Corporation, Inc.
3380 C Street, Suite 210
Anchorage, AK 99503-3920
Lola Lind
General Manaager
Chignik Lake Electric Utility, Inc.
P. 0. Box 33
Chignik Lake, AK 99548
October 22, 1993
Page 2 of 6
Artie H. Demandel
President
Aniak Light and Power Company, Inc.
P.. 70. “BOX: 129 Aniak, AK 99557
Kirsten Tinglum, Esq.
Ashburn and Mason
1130 West Sixth Avenue, Suite 100
Anchorage, AK 99501
Cory R. Borgeson, Esq.
Birch, Horton, Bittner & Cherot
100 Cushman Street, Suite 311
Fairbanks, AK 99701
Paul Dock
Manager
Kipnuk Light Plant
Pi. 0. Box “71
Kipnuk, AK 99614
SERVICE LIST (CONTINUED)
R-93-004
Donald W. Edwards, Esq.
General Counsel
Chugach Electric Association, Inc.
P. O. Box 196300
Anchorage, AK 99519-6300
Clayton Hurless
General Manager
Copper Valley Electric
Association, Inc.
P. O. Box 45
Glennallen, AK 99588-0045
Gary L. Ferguson
President
G & K, Inc.
P. O. Box 117
Cold Bay, AK 99571
Ronald L. Saxton, Esq.
Paul J. Kaufman, Esq.
Ater Wynne Hewitt Dodson & Skerritt
Suite 1800
222 Southwest Columbia
Portland, OR 97201-6618
October 22, 1993
Page 3 of 6
David L. Highers
General Manager
Chugach Electric Association, Inc.
P.O. Box 196300
Anchorage, AK 99519-6300
The Honorable Paul Fuhs
Commissioner
Department of Commerce & Economic
Development
State of Alaska
P. O. Box 110800
Juneau, AK 99811-0800
Michael P. Kelly
General Manager
Golden Valley Electric
Association, Inc.
P. O. Box 71249
Fairbanks, AK 99707-1249
Richard H. Levitt
President
Gustavus Electric Company, Inc.
P. O. Box 102
Gustavus, AK 99826
SERVICE LIST (CONTINUED)
R-93-004
Vera James
President
Gwitchyaa Zhee Utility Company
P. O. Box 9
Fort Yukon, AK 99740
Andrew E. Hoge, Esq.
Hoge & Lekisch
441 West Fifth Avenue, Suite 500
Anchorage, AK 99501-2309
Roger R. Kemppel, Esq.
Kemppel, Huffman & Ginder, P.C.
255 East Fireweed, Suite 200
Anchorage, AK 99503
Brad Reeve
General Manager
Kotzebue Electric Association, Inc.
P. O. Box 44
Kotzebue, AK 99752
October 22, 199
Page 4 of
Andrew J. Eggen
General Manager
Haines Light & Power Company
P. O. Box 30
Haines, AK 99827
Norman L. Story
General Manager
Homer Electric Association, Inc.
3977 Lake Street
Homer, AK 99603-7680
David S. Nease, Jr.
Manager
Kodiak Electric Association, Inc.
P. O. Box 787
Kodiak, AK 99615
Charles R. Baldwin, Esq.
Law Firm of C. R. Baldwin
125 North Willow Street, Suite 100
Kenai, AK 99611
SERVICE LIST (CONTINUED)
R-93-004
B. Richard Edwards, Esq.
Law Offices of B. Richard Edwards
550 West Seventh Avenue, Suite 1230
Anchorage, AK 99501
Kenneth E. Ritchey
General Manager ‘ait
Matanuska Electric Association, Inc.
P. O. Box 2929
Palmer, AK 99645-2929
3ary Kessinger
3seneral Manager
Middle Kuskokwim Electric
Cooperative, Inc.
P. O. Box 40
Red Devil, AK 99656
Daniel Nelson
General Manager
Napakiak Ircinaq Power Company
P. O. Box 34030
Napakiak, AK 99634
October 22, 1993
Page 5 of 6
Steve Hamlen
President
Manley Utility Company, Inc.
P. O. Box 92730
Anchorage, AK 99509-2730
Bill Frazier
General Manager
McGrath Light & Power Company
P. O. Box 52
McGrath, AK 99627
Thomas R. Stahr
General Manager
Municipal Light and Power Department,
Municipality of Anchorage d/b/a
1200 East First Avenue
Anchorage, AK 99501
Clarence L. Larsen
President/Manager
Northway Power & Light, Inc.
P. O. Box 410
Northway, AK 99764
SERVICE LIST (CONTINUED)
R-93-004
Jerry Nogle
Office Manager
PUI Acquisition Corporation
P. O. Box 110
Pelican, AK 99832
Linda Dianne Rabb
Executive Director
Rural Alaska Power Association, Inc.
P. O. Box 100214
Anchorage, AK 99510-0214
Mark Lang
General Manager
Tanalian Electric Cooperative, Inc.
1 Lang Road, General Delivery
Port Alsworth, AK 99653-999
Richard L. Blodgett
President
Teller Power Company, Inc.
P.O. Box 243992
Teller, AK 99524-3992
October 22, 1993
Page 6 of 6
Janice R. Ball
Village Council President
Pilot Point Village Council, Inc.
P. O. Box 449
Pilot Point, AK 99649
Jack Mager
President
Sand Point Electric, Inc.
P. O. Box 209
Sand Point, AK 99661
Paula E. Eller
General Manager
Tanana Power Company, Inc.
P. O. Box 873809
Wasilla, AK 99687-3809
Alaska Administrative Journal
Val Lind, Word Processing Section
Department of Commerce and
Economic Development
P. O. Box 110800
Juneau, AK 99811-0800
O = ym ss
WOHLFORTH, ARGETSINGER, JOHNSON & BRECHT bn B tA
PETER ARGETSINGER a a TELEPHONE
JULIUS J. BRECHT ATTORNEYS AT LAW (907) 276-6401
CYNTHIA L. CARTLEDGE
ROBERT M. JOHNSON 900 WEST STH AVENUE, SUITE 600 TELECOPY THOMAS F. KLINKNER dekh ahegnel
BRADLEY E. MEYEN ANCHORAGE, ALASKA 99501-2048 JAMES A. SARAFIN -
KENNETH E. VASSAR ERIC E. WOHLFORTH
MEMORANDUM
TO: William R. Snell
Executive Director
Alaska Industrial Development and Export Authority
FROM: Pete Argetsinger Le
DATE: September 15, 1993
SUBJECT: Alaska Public Utilities Commission/Regulatory Cost Charge
Our File No. 3730.0701
Enclosed for the Authority’s records is a copy of Order No. 2, U-93-46, of
the Alaska Public Utilities Commission. Your attention is called to lines 18-20, 23
and 24 on page 4 which, pursuant to our request filed with the Commission on
July 28th (copy also enclosed), clarifies the Authority's status as a utility which
provides wholesale service only. What this means is that the Regulatory Cost
Charge (which is designed to recover the Commission’s budget from the utilities
which it regulates) is not applicable to the Authority.
‘AUU00087,
Alaska Public Utilities Commission 1016 West Sixth Avenue, Suite 400 Anchorage, Alaska 99501 (907) 276-6222 10
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'Cost Charge Determination for
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AeSElVE|
SEP 10 1993
OF ALASKA 5 (ea! Wohlforth Argetsinger
THE ALASKA PUBLIC UTILITIES COMMIS snson & Brack?
Don Schroer, Chairman
Susan M. Knowles
Daniel Patrick O’Tierney
Mark A. Foster
James E. Carter, Sr.
Before Commissioners:
In the Matter of the Regulatory
Cost Charge Determination for
Fiscal Year 1994 for Regulated
Public Utilities
U-93-46
ORDER NO. 2
In the Matter of the Regulatory
P=93-1
Fiscal Year 1994 for Pipeline
Carriers ORDER NO. 2
ORDER ESTABLISHING REGULATORY COST CHARGE
2 Wy G APPLI ON OF 3 AAC 47.040
8 NECESSARY; AND AFFIRMING STATUS OF
REGULATED AND EXEMPT UTILITIES, AS CLARIFIED
BY THE COMMISSION:
Introduction
By Order U-93-46(1)/P-93-1, dated July 20, 1993, th
Commission issued for public comment the proposed regulatory cos
charge (RCC) amounts for Fiscal Year 1994 (FY94) and a designatio:
of utilities as regulated or exempt. The proposed amounts wer:
$.000439 per kilowatt-hour (/kWh) for regulated electric utilitie
and 0.455 percent of adjusted gross regulated operating revenu
for all other regulated utilities and pipeline carriers. In tha
.Order the Commission also established a filing and hearin
U-93-46(2) /P-93-1(2) - (7/8/93)
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schedule. By Errata Notice dated August 9, 1993, the Commission
corrected a typographical error regarding the RCC applicable to
kWhs in effect in FY93.
Written comments were filed by Alaska Industrial and
Development and Export Authority (AIDEA); Alaska Rural Electric
Cooperative Association, Inc.; Chugach Electric Association, Inc.;
Golden Valley Electric Association, Inc. (GVEA); the Municipality
of Anchorage d/b/a Anchorage Telephone Utility (ATU); the
Municipality of Anchorage d/b/a Municipal Light and Power
Department; and the owners of the Trans Alaska Pipeline Systen.
The public hearing convened, as scheduled, on August 24,
1993. No member of the public offered testimony.
Discussion
Several of the written comments filed in this matter
stated that the RCC amounts proposed by the Commission should be
adjusted downward to reflect that the charge established during
FY93 remains in effect during the first quarter of FY94. The
charge for FY93 was established to collect the Commission’s budget
over a period of only eight months and was, therefore, higher than
appropriate if applied over an entire twelve-month period.
Several of the comments also mentioned that in adjusting the RCC
amounts for the remainder of FY94 there would need to be some
consideration of the seasonality of utility revenues.
The Commission has considered the foregoing comments and
determined that the proposed RCC amounts for FY94 should be
U-93-46(2) /: -93-1(2) - (7/8/93)
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adjusted to reflect the fact that the higher rate from FY93
remains in effect for the first quarter of FY94.! The precise
adjustment requires the Commission to apply sound judgment in this
matter. If the residual RCC revenue requirement were collected
on a linear basis; i.e., 25 percent each quarter, then the RCC
would be 0.389 percent and $.000376/kWh. (See Appendix A attached
hereto.) However, the Commission agrees with GVEA that there is
some seasonal variance in public utility revenues, particularly
for electric and gas utilities. But, no accurate data on the
extent of the seasonality is currently available for all utility
sectors.
In view of these considerations, the Commission has
determined that the RCC applicable to gross revenues should be
established at 0.4 percent. Implicit in that figure is an
assumption that 21.6 percent of the total regulated gross revenues
for the year will occur in the first quarter, which reflects an
estimate of seasonality and produces an RCC that is reasonable in
amount. While that RCC percentage is slightly above the linear
RCC rate, it should help mitigate a larger adjustment upward next
year for the lower than average collections during the first
quarter of FY95.
lsince the state’s budget process was not completed until
June of FY93, it was not possible to establish the FY94 RCC prior
to the July 1 start of that new fiscal year.
U-93-46(2) /P-93-1(2) - (7/8/93)
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1016 West Sixth Avenue, Suite 400 Anchorage, Alaska 99501 (907) 276-6222 10
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Calculation of the 0.4 percent RCC is set out in Appen-
dix B attached hereto. The Commission waives strict application
of the formula set out at 3 AAC 47.040(a) to the extent necessary
to consider the higher level of collections during the first
quarter of FY94. (See line 12.1, Appendix B.)
The RCC applicable to kWh sales is established at
$0.000386/kilowatt hour. This level is determined based on the
RCC of 0.4 percent applicable to gross revenues and the same
assumption regarding seasonality. As with the RCC percentage, the
Commission waives strict application of the formula set out at
3 AAC 47.040(b) to the extent necessary to offset the higher level
‘of collections during the first quarter of FY94. The calculation
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is set out in Appendix B, lines 19 — 23.
Two comments were also filed regarding the designation
of utilities as regulated or exempt. ATU requested clarification
why it was properly classified as a regulated utility but
"Anchorage, Municipality of" also appears on the list of exempt
utilities. AIDEA stated that it is listed as a regulated utility
but that it is not subject to the RCC because all of its sales
will be at wholesale.
The listing of "Anchorage, Municipality of" is clarified
‘to refer to the exempt refuse collection utility of the Munic-
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ipality. AIDEA is correctly listed as a regulated utility, but
the list should note that AIDEA provides wholesale services only.
U-93-46(2) /P-93-1(2) - (7/8/93)
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ATU filed comments concerning the treatment of various
revenue accounts. At the its Public Meeting of January 27, 1993,
the Commission concurred with the analysis by Commission Staff
that the following revenue accounts should be excluded from the
RCC calculation for local exchange carriers:
5081 End User Revenue Settlements
5082 Switched Access Revenue
5083 Special Access Revenue
5084 State Access Revenue
5270 Carrier Billing and Collection Revenue
The Commission also determined that the revenue from the classi-
fied section of directories, commonly referred to as "yellow page
advertising," is derived from services which are "incidental" to
public utility operations rather than derived from "regulated"
operations. Thus, the Commission found that the revenues within
Account 5230, Directory Revenue, derived from yellow page
advertising, should be excluded from the RCC calculation. ?
ORDER
THE COMMISSION FURTHER ORDERS:
1. For regulated electric utilities the regulatory cost
charge applicable to kilowatt-hours is $0.000386, applicable
beginning October 1, 1993.
2The Commission notes that this exclusion of yellow page
advertising revenues from the RCC calculation should not be
construed as in any way limiting the Commission’s authority to
require yellow page advertising revenues to be used as an offset
against basic local exchange rates.
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2. For all other regulated utilities and pipeline
carriers the regulatory cost charge applicable to adjusted gross
operating revenues is 0.4 percent, applicable beginning October 1,
1993.
3. The Commission waives 3 AAC 47.040 to the extent set
forth in the body of this Order.
4. The listing of regulated and exempt utilities
attached to Order U-93-46(1)/P-93-1(1) is affirmed as clarified
in the body of this Order.
5. The telephone revenue accounts set out herein and
yellow page advertising revenues are excluded from regulatory cost
charge calculations for local exchange carriers as discussed in
the body of this Order.
6. All regulated utilities and pipeline carriers that
wish to recover the regulatory cost charges from their customers
or shippers must have an appropriately worded provision to that
effect in their tariffs. The Commission Staff shall prepare the
tariff revisions necessary to implement the changes in the
regulatory cost charges set forth in Ordering Paragraph Nos. 1 and
2 above for all utilities and pipeline carriers that have
currently tariffed regulatory cost charges. The changes are
effective for billings rendered on and after October 1, 1993. If
a regulated utility or pipeline carrier does not currently have
a tariffed regulatory cost charge provision and it wishes to
recover the regulatory cost charge from its customers or shippers,
U-93-46(2) /P-93-1(2) - (7/8/93)
Page 6 of 7
1 it may request the Commission Staff to prepare such a filing on
2 its behalf or submit-a tariff advice filing in accordance with
3 3 AAC 47.070(c).
DATED AND EFFECTIVE at Anchorage, Alaska, this 8th day of Septem-
5 ber, 1993.
6 BY DIRECTION OF THE COMMISSION
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(7/8/93)
Computation of Regulatory Cost Charge (RCC)
For FY94: July 1, 1993 - June 30, 1994
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Line Utility Gross Revenues Three 0.389%
1992 Revenue Quarters Percent RCC Estimated
SECTOR (Actual) 75.0% (1.17) RCC
1 Electric $351,860.486 $263,895.365 0.389% $1,026,553
2 Gas $114,199,505 $85,649,629 0.389% $333,177
3 Retuse $20,656,122 $15,492,092 0.389% $60,264
4 Wastewater $20,594,329 $15,445,747 0.389% $60,084
5 Local Exchange Telephone $78,835,789 $59,126,842 0.389% $230,003
6 Interexchange Telephone $92,130,745 $69.098,059 0.389% $268,791
7 Cable $502,500 $376,875 0.389% $1,466
8 Water $24,097,453 $18,073,090 0.389% $70,304
9 Pipeline $111,838,906 $83.879.180 0.389% $326.290
10 TOTAL $814.715.835 $611,036,876 $2.376.933 | ace emencee E ———
Formula for Computing RCC: RCC = (B-(E+E')+X)/GR
11 B = APUC Budget (4Qs) $3,624,200
12 E = Estimated Actual Cost Charges ($100,000)
12.1 E' = Estimated 10 collections ($1,330,024) 0.6530% * line 10, col. A * (25%)
13. X = Uncoliectibles allowance (5% X 1.11) $181,210
14 Total to be Recovered (3Qs) $2.375.386
15 GR = Utility Gross Receipts (3Qs) $611,036,876 75.0%
16 RCC Percent (1.14/1.15) 0.3887% tena
17 RCC Percent Rounded 0.389%
18 Estimated Collections FY 94 (1.12.1 + 1.10.col.D)
Computation for Electric kWh
19 1992 Electric Gross Retail Revenue (I.1) $263.895,365 75.0% of line 1
20 Multiply by RCC (1.17) 0.389%
21 Amount Derived trom Electric (1.19 X 1.20) $1,026,553
22 1992 Electric Retail kWh 2.733,432.446 75.0% of annual retail kWh
23 Rate per kWh (1.19/1.20) $0.000376
NOTES:
Assume 25% of revenue collected in 1st Quarter
ORDER U-93-46(2)/P-93-1(2)
APPENDIX A
Page 1 of!
Computation of Regulatory Cost Charge (RCC)
For FY94: July 1, 1993 - June 30, 1994
A 8 c 2
Line Utility Gross Revenues Three 0.400%
1992 Revenue Quarters Percent RCC Estimated
SECTOR (Actual) 78.4% (117) RCC
1 Electric $351,860.486 $275.858,621 0.400% $1,103,434
2 Gas $114,199,505 $89.532.412 0.400% $358.130
3 Refuse $20,656,122 $16,194,400 0.400% $64,778
4 Wastewater $20,594.329 $16,145.954 0.400% $64,584
5 Local Exchange Telephone $78,835,789 $61,807,259 0.400% $247,229
6 Interexchange Telephone $92,130,745 $72,230,504 0.400% $288,922
7 Cable $502,500 $393,960 0.400% $1,576
8 Water $24,097,453 $18,892,403 0.400% $75,570
9 Pipeline $111,838.906 $87,681,702 0.400% $350.727
10 TOTAL $814.715.835 $638.737.215 $2,554.949 ee 0 sede
Formula for Computing RCC: RCC = (B-(E+E')+X)/GR
11 8 = APUC Budget (4Qs) $3,624,200
12 E = Estimated Actual Cost Charges ($100,000)
12.1 E' = Estimated 1Q collections ($1,149,140) 0.6530% * line 10, col. A * (21.6%)
13. X = Uncollectibles allowance (5% X 1.11) $181.210
14 Total to be Recovered (3Qs) $2.556.270
15 GR = Utility Gross Receipts (3Qs) $638.737.215 78.4%
16 RCC Percent (1.14/1.15) 0.4002% (ee
17 RCC Percent Rounded 0.400%
18 Estimated Collections FY 94 (1.12.1 + 1.10,col.0) $3.704.089
Computation for Electric kWh
19 1992 Electric Gross Retail Revenue (i.1) $275,858,621 78.4% of line 1
20 Muttipty by RCC (1.17) 0.400%
21 Amount Derived from Electric (1.19 X 1.20) $1,103.434
22 1992 Electric Retail kWh 2.857.348.0050 78.4% of annual retail kWh
23 Rate per kWh (I.19/1.20) $0.000386
NOTES:
Set RCC = 0.4% for ‘rounding’
Assume 21.6% of revenue collected in 1st Quarter
ORDER U-93-46(2)/P-93-1(2)
APPENDIX B
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STATE OF ALASKA
Before Commissioners:
In the Matter of the Regulatory
Cost Charge Determination for
Fiscal Year 1994 for Regulated
Public Utilities
In the Matter of the Regulatory
Cost Charge Determination for
Fiscal Year 1994 for Pipeline
Carriers
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IES _C ON
Don Schréer, Chairman
Susan M. Knowles
Daniel Patrick O’Tierney
Mark A. Foster
James E. Carter, Sr.
U-93-46
PeS3-1 Verve ve ve ye eve ee CERTIFICATION OF MAILING
I, _TAMARA M. ALEXANDER
I am 2 Documents Processor IV
, certify as follows:
in the offices of
the Alaska Public Utilities Commission, 1016 West Sixth Avenue,
Suite 400, Anchorage, Alaska 99501.
On September 9, 1993, I mailed copies of
ORDER NOS. 2/2, entitled:
ORDER ESTABLISHING REGULATORY COST CHARGE
AMOUNTS; WAIVING APPLICATION OF 3 AAC 47.070,
AS NECESSARY; AND AFFI ING STATUS OF REGULATED
AND_EXEMPT UTILITIES, AS CLARIFIED
(Issued September 8, 1993)
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U-93-46(2)/P-93-1(2) - (Certification of Mailing)
Page 1 cf 2
1016 West Sixth Avenue, Suite 400 Anchorage, Alaska 99501 Alaska Public Utilities Commission (907) 276-6222 1
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in the proceeding identified above to the persons indicated on the
attached service list.
DATED at Anchorage, Alaska, this _9th day of September, 1993.
U-93-46(2) /P-93-1(2)
Page 2 of 2
Garraruae Yr. Alive bela!
TAMARA M. ALEXANDER
(Certification of Mailing)