PUC Staff Recommend That Assessment Fee Collected Through SOS Rates Be Refunded To Customers, Through Nonbypassable Rider
September 9, 2019 Email This Story Copyright 2010-19 EnergyChoiceMatters.com
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Staff of the Public Utilities Commission of Ohio have recommended that amounts currently collected by Dayton Power and Light through its bypassable standard offer rates for PUCO/OCC assessment fees be credited back to customers, via nonbypassable surcharge, to prevent double recovery of the costs due to such costs also being included in distribution rates
Staff explained that, "On April 15, 2019 in Case No. 19-841-EL-RDR, The Dayton Power and Light Company (DP&L or
Company) filed proposed tariffs to modify its Standard Offer Rates Tariff. The proposed tariffs
include Standard Offer Rates (SOR) and Percentage of Income Payment Plan (PIPP) generation
rates. Pursuant to the Commission's Order in Case No. 16-395-EL-SSO, the proposed rates now
include an alternative energy rate (AER) component, a reconciliation component and an unbilled
Staff said, "As part of the reconciliation component, DP&L Is collecting the SSO generation revenue
percentage of the PUCO/OCC assessment fees through the SOR rider, as approved by the
Commission's Order in Case No. 15-1830-EL-AIR (Rate Case Order). The Commission clarified,
however, that the SOR rider may recover 'adjusted test year expenses only.'"
Staff said, "On May 29, 2019, the Commission approved the annual update of the SOR rates and the effective
date of June 1, 2019."
Staff said, "Pursuant to the SOR rider's tariff, the rider is subject to reconciliation, including refunds to
customers, based upon audits ordered by the Commission. Staff completed its review of the SOR
rider's reconciliation component for the period of April 1, 2018 through March 31, 2019. Staff
reviewed supplier charges, consultant fees, revenues collected under the competitive bid portion
as well as the Company's calculation of carrying charges and the gross revenue conversion factor."
Staff said, "In October of 2018, the Company began recovering, through the bypassable SOR rider, $56,289
per month for PUCO/OCC assessment fees. Staff reviewed the revenue percentage calculated by
the Company and agrees it conforms to Staff's recommendation in Case No. 15-1830-EL-AIR,
'that the SSO generation revenue percentage of the PUCO/OCC assessment expense be
recovered through an appropriate bypassable rider.'"
Staff said, "Staff verified through a Data Request with the Company that the entire test year amount of
PUCO/OCC assessment fees ($1,986,667) is collected through base rates. Because the Company
did not adjust the PUCO/OCC assessment expense collected in base rates to exclude the percentage of the expense related to SSO generation revenue, there are no adjusted test year
expenses to recover. Therefore, any additional amount recovered through the SOR rider would
constitute a double recovery of a portion of the PUCO/OCC assessment fees. Staff is concerned
that this double recovery would be harmful to consumers and violate the Commission's Rate Case
Order. Therefore, Staff recommends that all PUCO/OCC assessment fees collected through the
bypassable SOR rider be credited back to customers through a non-bypassable rider."
"Staff is satisfied that the reconciliation component is both consistent with and in compliance
with the Commission's Orders, with the exception of the assessment fees. While Staff agrees
with the Company's derived revenue percentage. Staff recommends the Commission direct the
Company to credit to customers the PUCO/OCC assessment fees collected through the SOR
rider within a non-bypassable rider to avoid a double recovery," Staff said