CHAPTER Puc 1900 RATE CASE EXPENSES
Statutory Authority: RSA 365:8, X
PART Puc
1901 PURPOSE
Puc 1901.01 Purpose.
(a) The purpose of this chapter, pursuant to RSA
365:8, X, and consistent with the intent of RSA 363:17-a, is to ensure equitable
reimbursement of rate case expenses, to establish requirements for utilities to
properly document and control rate case expenses, and to limit the impact of
rate case expenses on ratepayers.
(b)
This chapter establishes criteria for determining whether the rate case
expenses that have been incurred by a utility are just and reasonable and are
in the public interest.
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PART Puc 1902 APPLICATION OF RULES
Puc 1902.01 Application of Rules.
Chapter Puc 1900 shall apply to any “utility” as defined in
Puc 1903.07.
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11-15-13
PART Puc 1903 DEFINITIONS
Puc 1903.01
“Commission” means the
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Puc 1903.02 “Final order” means an order of the
commission, issued pursuant to RSA 541-A:35, rendering its final determination
on permanent rates.
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Puc 1903.03 “Full rate case” means a proceeding in which
a revenue requirement is established for a utility and rates are set to meet
that revenue requirement pursuant to Puc 1604.
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Puc 1903.04
“Non-recurring expenses” means those expenses not regularly recurring as
part of a utility’s operating costs.
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Puc 1903.05 “Rate case expenses” means those
non-recurring expenses incurred by a utility in the preparation or presentation
of a full rate case proceeding before the commission, necessary for the conduct
of the rate case.
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Puc 1903.06 “Service provider” means any natural person
or legal entity who provides expert, consulting, administrative, or legal services
to a utility and whose services are not already included in the utility’s
revenue requirement.
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Puc 1903.07 “Utility” means any public utility as defined
in RSA 362:2 and RSA 362:4.
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PART Puc
1904 APPROVAL BY COMMISSION
Puc 1904.01 Approval Required Prior to Recovery. No utility shall recover from its ratepayers any
rate case expense unless such expense has first been found by the commission to
be just and reasonable and in the public interest and otherwise conforms to the
requirements of Chapter Puc 1900.
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Puc 1904.02 Criteria for Determining Allowed Rate Case
Expenses.
(a)
In ruling upon rate case expenses the commission shall determine
whether:
(1) An expense is properly recoverable as an
allowed rate case expense pursuant to Puc 1906;
(2) The expense is an actual, known, and
measurable expense associated with a full rate case proceeding, defined in Puc
1903.03; and
(3) Recovery of the expense is just, reasonable,
and in the public interest.
(b) In making the above determinations, the
commission shall consider:
(1) Whether the issues presented are novel or
complex;
(2) The cost of the service provided to prepare
and present the rate case;
(3) Where appropriate,
any information concerning the customary fee for similar services, including
the fees rendered in the relevant market to companies of similar size in
matters of similar importance to the client;
(4) Whether the work was relevant and reasonably
necessary to the rate case proceeding and the extent to which the services
contributed to the efficient resolution of matters presented;
(5) Whether the utility used a competitive
bidding process, when required, pursuant to Puc 1905.03 and Puc 1905.04, and in
selecting a winning bidder considered information concerning the availability,
experience, quality and cost of services provided;
(6) The experience and ability of the service
provider;
(7) Whether the request for a rate change was
just and reasonable; and
(8) Other factors as may be considered relevant
to a particular rate case proceeding.
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PART Puc 1905 PROCEDURES FOR FILING FOR RECOVERY OF
EXPENSES
Puc 1905.01 Estimated
Rate Case Expenses.
(a) Consistent with
the utility’s duty to keep the commission informed pursuant to RSA 374:4, at the time a utility files the materials required for a
full rate case pursuant to Puc 1604, and every 90 days thereafter during the
pendency of the rate case, the utility shall also file with the commission
items (1) through (3) below:
(1) A detailed description of rate case expenses
actually incurred as of the date of the filing and projected total rate case
expenses that include:
a. The name of the service provider;
b. The procurement process;
c. The amount of the expense; and
d. A description of the charge or service
rendered;
(2) A list of all services to be rendered on behalf
of the utility in the full rate case by any vendor; and
(3) The total estimated costs of each service.
(b) The filing of the information listed in (a)
above shall not constitute or imply commission approval of the expenses.
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Puc 1905.02 Deadline for Filing Recovery Request. A utility seeking recovery of rate case
expenses shall file its request for recovery pursuant to Parts Puc
202 and 203 along with all supporting documentation, with the commission no
later than 30 days after the commission’s final order pursuant to Puc 1903.02.
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Puc 1905.03 Documentation of Expenses Required. For each expense filed with the commission
for recovery as a rate case expense, the utility shall provide detailed
evidence of all rate case expenses and any related allocations including:
(a)
All invoices paid or to be paid;
(b)
Name of each vendor;
(c)
The amount of the expense to be included as part of rate case expenses;
(d)
A description and date of the charge or service rendered;
(e)
A statement that the expense is consistent with the utility’s written
procurement policy;
(f)
The utility’s procurement policy in place at the time the expenses were
incurred;
(g)
The contract entered into that generated the expense; and
(h)
A statement of whether the contract was obtained after negotiations or
competitive bid.
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Puc 1905.04 Additional Requirements for Service
Providers.
(a)
All utilities serving 600 customers or more and hiring service providers
for use in a full rate case shall acquire such services through a competitive
bidding process if the expense for such service is estimated to be or is
$10,000 or greater.
(b)
Except if not necessary under (a), for each service provider used, the
utility shall also include a certification that:
(1) The utility
used a competitive bidding process, and in selecting the winning bidder,
considered information concerning the availability, experience, customary fees
for similar services, quality, and cost of the service provider; and
(2) The time spent on the rate case by the
service provider was undertaken in an efficient and cost effective manner.
(c)
If a utility is required to use a competitive bidding process pursuant to
Puc 1905.04(a) and engages a service provider who is not the lowest bidder in a
competitive bidding process, the utility shall provide clear and convincing
justification of its decision to do so.
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PART Puc
1906 EXPENSES RECOVERABLE AS RATE CASE
EXPENSES
Puc 1906.01 Allowed Expenses.
(a) The commission shall determine
pursuant to Puc 1904 the recovery of actual, known, and measurable rate case
expenses from a full rate case, defined in Puc 1903.03, provided the expenses
are related to the rate case, just and reasonable and in the public interest.
(b)
Such rate case expenses may include as follows:
(1) Costs related to the preparation of items
required as part of a full rate case, pursuant to PART Puc 1604;
(2) Expert consultant fees;
(3) Legal and accounting fees;
(4) Expenses associated with changing billing
systems to reflect temporary and permanent rate changes;
(5) Travel expenses;
(6) Administrative costs such as postage costs,
publication costs, photocopying expenses, and transcription costs; and
(7) Such other similar expenses that are related
to the preparation or presentation of a full rate case, defined by Puc 1903.03,
as determined by the commission after its review.
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PART Puc
1907 EXPENSES NOT RECOVERABLE AS RATE
CASE EXPENSES
Puc 1907.01 Expenses Not Allowed. Expenses not recoverable as rate case
expenses shall include:
(a)
Expenses for matters handled by service providers that are typically
performed by utility management and staff of the utility, based on their
experience, expertise, and availability;
(b)
Expenses typically included in a utility’s test-year revenue requirement
or any expense for which recovery is prohibited by other commission rule.
(c)
Expenses related to responding to commission audit inquiries;
(d)
Expenses for first class airfare, gifts, or alcohol;
(e)
Lobbying expenses;
(f)
Interest charges on rate case expenses; and
(g)
Such other similar expenses that are not related or material to the
preparation or presentation of a full rate case, as determined by the
commission after its review.
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PART Puc
1908 SURCHARGES FOR THE RECOVERY OF RATE
CASE EXPENSES
Puc 1908.01 Recovery through Rate Surcharge. Approved rate case expenses shall be included
in rates through the imposition of a surcharge to rates.
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Appendix
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Puc 1900 |
RSA 365:8, X |