Energy Choice
                            

Matters

Archive

Daily Email

Events

 

 

 

About/Contact

Search

Details of Settlement Filed to Set Adders to Bypassable SOS Rate

February 5, 2014

Email This Story
Copyright 2010-13 EnergyChoiceMatters.com
Reporting by Karen Abbott • kabbott@energychoicematters.com

Details of a non-unanimous settlement that would set the bypassable SOS Administrative Charge at Pepco and Delmarva have now been filed at the Maryland PSC.

The settlement is supported by PSC Staff, Pepco, Delamrva, and the Retail Energy Supply Association. The People's Counsel opposes the settlement.

Notably, the settling parties agree that for Residential SOS, the total Administrative Charge will be set at 3.5 mills/kWh. This excludes cash working capital costs, which will be charged separately.

Under the non-unanimous settlement, the parties agree that the SOS Administrative Charge for Residential, Type I, Type II, and Hourly Priced Non-Residential Service would continue to be composed of a utility return component, an incremental cost component, an uncollectibles component, and an Administrative Adjustment component. The Administrative Charge would continue to apply exclusively to kWh of SOS load, and would not be applicable to kWh load served by competitive retail suppliers.

The settlement would set the utility return component of the SOS Administrative Charge as follows (all amounts per kWh): Residential SOS service, 1.3 mills; Type I SOS service, 2.0 mills; Type II SOS service, 2.0 mills; and Hourly-Priced Non-Residential SOS service, 2.25 mills. The utility return component of the Administrative Charge would be paid to the utilities as return for the provision of SOS, for retention by their shareholders.

The settling parties also agree that the utilities will recover their actual incremental costs of supplying SOS for all customer classes. For Types I and II SOS, as well as Hourly-Priced Non-Residential SOS, the incremental cost component, including the administrative credit mechanism, will remain unchanged from a 2003 settlement, with the exception of cash working capital as described below.

The utilities would use a baseline of 0.2 mills/kWh for Residential SOS incremental costs during the first year. Following each year of program operation, the utilities would file with the Commission a report detailing the actual incremental costs of providing SOS for the previous year, with all supporting documentation. The actual incremental costs for a given SOS year shall be used to true up the estimated incremental costs for that same year, and any over- or under-collection of costs shall be applied to the estimated incremental costs for the next SOS program year.

The parties agree that the uncollectibles component for each of the utilities for Residential SOS service will consist of the allocation of their uncollectibles to the supply component determined by the Commission in each of the utilities' most recent base distribution rate case. For Types I and II SOS, as well as Hourly-Priced Non-Residential SOS, the utilities will use the uncollectibles methodology that was determined in the 2003 Settlement

The Administrative Adjustment component, which is a refund paid to all distribution customers from revenues under the SOS Admin. Charge, would be calculated as the total Administrative Charge less incremental costs, uncollectible costs, and the utility return component.

As of the effective date of the settlement, the Administrative Adjustment for Residential SOS would be 0.41 mills/kWh for Pepco and 0.62 mills/kWh for Delmarva. These amounts are based on the parties agreement, noted above, that for Residential SOS, the total Administrative Charge will be set at 3.5 mills/kWh.

The revenues associated with the Administrative Adjustment would be credited to all Residential distribution customers in the form of a per kWh credit, which would be calculated by dividing the available revenues by the forecasted Residential distribution kilowatt-hours.

In the event that 35% of residential capacity peak load contribution migrates to competitive retail supply, Staff would convene a meeting among interested stakeholders to discuss whether the Administrative Adjustment should be reduced pursuant to paragraph 14 of the 2003 settlement.

Notably, parties propose that cash working capital costs not be collected through the SOS Admin Charge. The parties agree that the utilities will recover, outside of the Admin. Charge, their actual SOS cash working capital requirements, calculated as the revenue requirement associated with each class of SOS at the utilities' authorized rate of return, trued-up annually.

ADVERTISEMENT
NEW Jobs on RetailEnergyJobs.com:
NEW! -- Vice President of Operations -- Retail Supplier
NEW! -- Senior Business Analyst -- Retail Supplier
NEW! -- Energy Sales Manager -- Retail Provider
NEW! -- Energy Operations Analyst
NEW! -- Sales Support Represetative -- Retail Supplier
NEW! -- Senior Pricing Analyst
NEW! -- Sr. Dir./Director of Online Marketing -- Retail Provider -- Houston
NEW! -- Regional Sales Manager -- Retail Supplier -- Texas -- Houston
NEW! -- Director of Supply - Risk Manager -- Retail Supplier

Search for more retail energy careers:
RetailEnergyJobs.com


Email This Story

HOME

Copyright 2010-13 Energy Choice Matters.  If you wish to share this story, please email or post the website link; unauthorized copying, retransmission, or republication prohibited.

 

Archive

Daily Email

Events

 

 

 

About/Contact

Search