DATE:	November 29, 2012
TO:	Office of Commission Clerk (Cole)
FROM:	Office of the General Counsel (Miller) Division of Economics (Rome, Draper)
RE:	Docket No. 120258-GU – Proposed amendment of Rule 25-7.0851, F.A.C., Backbilling, and adoption of Rule 25-7.0852, F.A.C., Unauthorized Use Relating to Gas Utilities.
AGENDA:	12/10/12 – Regular Agenda – Interested Persons May Participate
COMMISSIONERS ASSIGNED:			All Commissioners
PREHEARING OFFICER:			Brown
RULE STATUS:			Proposal May Be Deferred
SPECIAL INSTRUCTIONS:			None
FILE NAME AND LOCATION:			S:\PSC\GCL\WP\120258.RCM.DOC

 

 Case Background

Rule 25-7.0851, Florida Administrative Code, (F.A.C.), addresses backbilling by gas utilities.  In our continuing review of our rules, staff thought it important to clarify existing practices in this rule.  Currently, the rule only addresses underbillings.  Staff is recommending that the rule be amended to address overbillings as well.

Staff is also recommending the adoption of new Rule 25-7.0852, F.A.C., Unauthorized Use.  It provides that, in the event of unauthorized or fraudulent use or meter tampering, the utility must bill the customer on an estimate of the gas used, based on the customer’s past consumption.

A Notice of Rule Development was published in the Florida Administrative Weekly on March 9, 2012.  No requests for workshop were submitted in response to the notice, and, thus, no workshop was held.

This recommendation addresses whether the Commission should propose the amendment of Rule 25-7.0851, F.A.C., and the adoption of new Rule 25-7.0852, F.A.C.  The Commission has jurisdiction pursuant to Section 120.54, Florida Statutes (F.S.).

Discussion of Issues

Issue 1: 

 Should the Commission propose the amendment of Rule 25-7.0851, F.A.C., Underbillings and Overbillings, and the adoption of new Rule 25-7.0852, F.A.C., Unauthorized Use?

Recommendation: 

 Yes.  The Commission should propose the amendment of Rule 25-7.0851, F.A.C., and the adoption of new Rule 25-7.0852, F.A.C., as set forth in Attachment A. (Miller, Draper)

Staff Analysis: 

 Rule 25-7.0851 currently addresses underbillings by gas utilities. Staff recommends that Rule 25-7.0851, F.A.C., be amended to also address overbillings by gas utilities.  Staff recommends that the rule be amended to state that, in the event of overbillings, the utility must refund the overcharge to the customer for the period during which the overcharge occurred, based on available records.  In the event of an overbilling, the customer may elect to receive the refund as a credit to future billings or as a one-time credit.

Staff also recommends that new Rule 25-7.0852, F.A.C., Unauthorized Use, be adopted.  Gas utilities do not currently have rules dealing with unauthorized use of gas service. This new rule would allow for a utility to bill for an estimate of usage where tampering has been detected. It provides that, in the event of unauthorized or fraudulent use or meter tampering, the utility must bill the customer on an estimate of the gas used, based on the customer’s past consumption. The new rule would allow gas utilities to recoup costs from customers who are not authorized to use their service, which avoids shifting those costs to other ratepayers.

Statement of Estimated Regulatory Costs (SERC)

The Statement of Estimated Regulatory Costs (Attachment B) analyzed whether the rule changes are likely to have an adverse impact on growth, private sector job creation or employment, or private sector investment in excess of $1 million in the aggregate within 5 years after implementation, as well as the impact on small businesses and local governments.  Also, the statute requires consideration of whether the draft rules are likely to have an adverse impact on business competitiveness, productivity, or innovation in excess of the above amount.  These proposed rule amendments would not have such impacts.  Thus, the rule amendments do not require legislative ratification, pursuant to Section 120.541(3), Florida Statutes.

Staff recommends that the Commission propose the amendment of Rule 25-7.0851, F.A.C., and the adoption of Rule 25-7.0852, F.A.C.

Issue 2: 

 Should this docket be closed?

Recommendation: 

 Yes.  If no requests for hearing or comments are filed, the rules should be filed with the Department of State, and the docket should be closed. (Miller)

Staff Analysis: 

 If no requests for hearing or comments are filed, the rules should be filed with the Department of State, and the docket should be closed.

25-7.0851 Underbillings and Overbillings Backbilling.

(1) A utility may not backbill customers for any period greater than 12 months for any undercharge in billing which is the result of the utility’s mistake. The utility shall allow the customer to pay for the unbilled service over the same time period as the time period during which the underbilling occurred or some other mutually agreeable time period. The utility shall not recover in a ratemaking proceeding any lost revenues which inure to the utility’s detriment on account of this provision.

(2) In the event of overbillings, the utility shall refund the overcharge to the customer for the period during which the overcharge occurred, based on available records.  If commencement of the overcharging cannot be fixed, then an estimate of the overcharge shall be made, based on past consumption, and refunded to the customer.  The amount and period of the adjustment shall be based on the available records.  The refund shall not include any part of a minimum charge.

(3)  In the event of an overbilling, the customer may elect to receive the refund as a credit to future billings or as a one-time credit.

Specific Authority 367.121 FS. Law Implemented 367.121 FS. History–New 5-8-91, Amended______.

Rule 25-7.0852 Unauthorized Use

(1) In the event of unauthorized or fraudulent use or meter tampering, the utility shall bill the customer on an estimate of the gas used, based on the customer’s past consumption.

Specific Authority 367.121 F.S.  Law Implemented 367.121 F.S.  History- New _______