The Public Utility Commission Thursday approved the petition of PPL Electric Utilities Corp. and of Peoples Natural Gas Co. and Peoples TWP to implement a distribution system improvement charge (DSIC).

PPL

The Commission voted 5-0 to approve in part the company’s petition, which was filed pursuant to Act 11 of 2012. The company’s DSIC may not become effective before July 1, 2013. The company also must notify customers of quarterly changes in the DSIC through bill messages, in addition to PPL Electric’s Connect newsletter.

The Commission also referred several issues in the petition related to tariff riders and tax calculations to the PUC Office of Administrative Law Judge for hearings.

The Commission had approved PPL’s long-term infrastructure improvement plan, which is required before enacting a DSIC, on Jan. 10, 2013. PPL plans to accelerate infrastructure replacement over a period of five years.

PPL provides electricity service to approximately 1.4 million customers in 29 counties in eastern and central Pennsylvania.

Peoples Gas

The Commission voted 5-0 to approve the LTIIP and DSIC petitions, which were filed pursuant to Act 11 of 2012. PUC Commissioner James H. Cawley issued a statement.

The companies’ DSICs may not become effective before July 1, 2013. The Commission also referred several issues in the DSIC petitions related to tariff riders and tax calculations to the PUC Office of Administrative Law Judge for hearings.

According to the LTIIP, Peoples will replace an average of approximately 47 miles of pipeline per year during the five-year period of the LTIIP. Peoples plans to spend between $55 million and $71 million per year on pipeline, meter and service replacement, over the five-year period of the plan. Peoples provides natural gas service to about 360,000 customers in all or portions of 16 southwestern counties.

According to the Peoples TWP LTIIP, the company will replace an average of approximately 28 miles of pipeline per year during the five-year period of the LTIIP. Peoples TWP anticipates spending a minimum of $9.1 million per year over the five-year period of the plan. Peoples TWP provides natural gas service to about 60,000 customers in portions of Armstrong, Butler, Cambria, Clarion, Clearfield, Indiana, Jefferson and Westmoreland counties.

Act 11 requires and provides for, among other things, utilities to file the plans as part of any action to establish a DSIC to recover reasonable and prudent costs incurred to repair, improve or replace certain eligible distribution property that is part of a utility’s distribution system.

As of January 1, 2013, public utilities could petition the Commission for approval to establish a DSIC. The petition must contain the following elements: 1) initial tariff; 2) testimony and exhibits to demonstrate that the DSIC will ensure the provision of adequate, efficient, safe, reliable and reasonable service; 3) long-term infrastructure plan; 4) certification that a base rate case has been filed within the past five years; and 5) any other information required by the Commission. The petition must demonstrate that granting the petition and allowing the DSIC to be charged will accelerate the replacement of infrastructure.

On February 14, 2012, Gov. Corbett signed Act 11 of 2012, which allows jurisdictional water and wastewater utilities, natural gas distribution companies, city natural gas distribution operations, and electric distribution companies to petition the Commission for approval to implement a DSIC.

Under the law, the DSIC must be designed to provide for "the timely recovery of the reasonable and prudent costs incurred to repair, improve or replace eligible property in order to ensure and maintain adequate, efficient, safe, reliable and reasonable service.”

For more information, visit the PUC’s Act 11 System Improvement Charges webpage.

NewsClip: PPL Adds Distribution Charge To Bills

5/27/2013