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DATE: |
August 1, 2013 |
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TO: |
Office of Commission Clerk (Cole) |
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FROM: |
Office of the General Counsel (Cowdery, Page) Division of Accounting and Finance (Bulecza-Banks, Maurey) Division of Economics (McNulty) |
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RE: |
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AGENDA: |
08/13/13 – Regular Agenda – Interested Persons May Participate |
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COMMISSIONERS ASSIGNED: |
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PREHEARING OFFICER: |
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SPECIAL INSTRUCTIONS: |
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FILE NAME AND LOCATION: |
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Section 366.076(1), Florida Statutes (F.S.), addresses limited proceedings and provides:
Upon petition or its own motion, the commission may conduct a limited proceeding to consider and act upon any matter within its jurisdiction, including any matter the resolution of which requires a public utility to adjust its rates to consist with the provisions of this chapter. The commission shall determine the issues to be considered during such a proceeding and may grant or deny any request to expand the scope of the proceeding to include other matters.
The staff of the Joint Administrative Procedures Committee (JAPC) of the Legislature, as part of its duty to maintain a continuous review of the administrative rulemaking process, pointed out that Section 366.06(1), F.S., requires that all applications for changes in rates be made to the Commission in writing under rules and regulations prescribed by the Commission. JAPC further noted that Section 366.076, F.S., authorizes the Commission to conduct limited proceedings, which can include the adjustment of rates, and suggested that the Commission adopt rules for applications for limited proceedings.
In response to JAPC’s suggestion, staff initiated rulemaking in this docket to codify the procedure for electric and gas utilities when filing a petition for a limited proceeding. Proposed Rules 25-6.0431 and 25-7.0391, F.A.C., would prescribe the filing requirements for a petition for limited proceeding for electric and gas investor owned utilities as required by Section 366.06(1), F.S. Suggested amendments to Rule 25-22.0406, F.A.C., would amend the noticing procedures for general rate increase requests by electric and gas companies subject to the Commission’s authority. The recommended amendments also create noticing requirements for utilities petitioning for a limited proceeding.
A rule development workshop was held on June 23, 2010. Workshop participants were the Office of Public Counsel (OPC), Florida Power and Light (FPL), Tampa Electric Company (TECO), Florida Industrial Power Users Group (FIPUG), Duke Energy Florida, Inc. (formerly Progress Energy Florida) (DEF), and Gulf Power Company (Gulf). Comments on the draft rules were submitted on July 28, 2010, by FPL, TECO, FIPUG, DEF, and Gulf. On March 15, 2012, a second workshop was held. Participants were Gulf, PEF, TECO, OPC, FPL and Florida Natural Gas Association/Associated Gas Distributors of Florida. Post-workshop comments were provided.
On March 7, 2013, staff issued a Notice of Development of Rulemaking which was published by the Commission in the Florida Administrative Register Vol. 39, No. 46, on the amendment of Rule 25-22.0406, F.A.C., and the adoption of Rules 25-6.0431 and 25-7.0391, F.A.C. The notice stated that written requests for a rule development workshop should be submitted by March 25, 2013. No requests for a workshop were received by the Commission. However, revisions to draft Rule 25-22.0406, F.A.C., were suggested by the utilities. Based upon these suggestions, Commission staff revised draft Rule 25-22.0406, F.A.C. On April 1, 2013, these revisions were provided to all interested parties. Comments were requested, but no comments were received by the deadline of April 15, 2013.
This recommendation addresses whether the Commission should propose the adoption of Rules 25-6.0431 and 25-7.0391, F.A.C., and the amendment of Rule 25-22.0406, F.A.C. The Commission has jurisdiction pursuant to Section 120.54, F.S., and Chapter 366, F.S.
Issue 1:
Should the Commission propose the adoption of Rule 25-6.0431, F.A.C., Petition for a Limited Proceeding, and Rule 25-7.0391, F.A.C., Petition for a Limited Proceeding, and the amendment of Rule 25-22.0406, F.A.C., Notice and Public Information on General Rate Increase Requests by Electric, Gas and Telephone Companies?
Recommendation:
Yes, the Commission should propose the adoption and amendment of these rules as set forth in Attachment A. (Cowdery, Page, Bulecza-Banks, Maurey)
Staff Analysis:
Staff recommends that the Commission propose the adoption of Rules 25-6.0431 and 25-7.0391, F.A.C., and the amendment of Rule 25-22.0406, F.A.C., as set forth in Attachment A. The rule adoptions would set forth application requirements for a petition for a limited proceeding for electric and gas utilities, as required for changes in rates by Section 366.06(1), F.S. Amendment of Rule 25-22.0406, F.A.C., updates general rate case noticing requirements for electric and gas utilities and establishes noticing requirements for gas and electric utility limited proceedings. Each rule is discussed in more detail below.
Recommended Rule 25-6.0431, Petition for a Limited Proceeding
Staff recommends the adoption of Rule 25-6.0431, prescribing the application requirements for filing a petition for a limited proceeding for electric utilities. In subsection (1), the rule would specify that a petition for a limited proceeding shall include, but not be limited to, a list of all issues the petitioner believes should be decided. Subsection (2) would specify that a petition for a limited proceeding must contain a detailed statement of the reasons for requesting the limited proceeding and why a limited proceeding is appropriate. Subsection (3) would require that a petition for a limited proceeding include a schedule showing the specific rate base components for which the utility seeks recovery on both a system and jurisdictional basis if the utility is requesting recovery of operating expenses. Subsection (4) would require that a petition for a limited proceeding include a schedule showing the specific expenses requested on both a system and jurisdictional basis. Finally, subsection (5) would specify that a petition for a limited proceeding must include a schedule showing how the utility proposes to allocate any change in revenues to rate classes, and the proposed rates, if the petition requests a change in retail rates. Subsection (6) has been added so as to not limit the contents of the petition to the items listed in subsections (1) through (5). These recommended requirements offer consistency in practice and codify the essential elements of a petition for limited proceedings by electric utilities.
Recommended Rule 25-7.0391, Petition for a Limited Proceeding
Staff recommends the adoption of Rule 25-7.0391, which would set forth the application requirements for filing a petition for a limited proceeding for gas utilities. This rule would state the same language contained in Rule 25-6.0431, and bears the purpose of offering consistency in practice and stating the components of a petition for limited proceedings by gas utilities.
Recommended Amendments to Rule 25-22.0406, F.A.C., Notice and Public Information on General Rate Increase Requests and Petitions for Limited Proceedings by Electric, Gas, and Telephone Companies
Draft Rule 25-22.0406, applies to both requests for general rate increases and to all limited proceedings filed by electric and gas utilities pursuant to proposed Rules 25-6.0431 and 25-7.0391. This rule would be amended so that section (2) would contain the revised noticing procedures that apply to requests for a general rate increase. In addition, all references to telephone companies would be deleted because the rule would be inapplicable to telecommunication companies as there are no longer any rate-of-return regulated telecommunications companies.
Under draft Rule 25-22.0406(2)(b), the noticing procedure for general rate increases would be changed to require the utility to establish a clearly identifiable link on the utility’s website to provide electronic public access to all documents filed in the rate case. Subsection (2)(c)1 would state that a utility shall place a copy of the Minimum Filing Requirements (MFRs) at its official headquarters and at a location approved by the Commission staff. This amendment is designed for greater customer access to the MFRs as most utilities may no longer have a business office in each municipality in which service hearings were held in the last general rate case of the utility. Subsection (2)(c)4 would be added so that copies of the MFRs would be available for public inspection during the regular business hours of the location hosting the MFRs and through a link to the utility’s website. Staff is recommending adoption of these amendments to ensure public access to the MFRs and to make their access consistent with current technology.
Subsection (2)(d) currently states the requirements for a utility’s rate case synopsis. Staff recommends that language be added requiring the utility to prepare and submit the synopsis to Commission staff for approval, codifying standard Commission practice. The requirements of the rate case synopsis would remain the same as the current rule. Subsection (2)(d)2 would require the utility to distribute copies of the synopsis as currently set forth in the rule within seven days following approval of the synopsis. The addition of the seven day time frame is intended to ensure timely distribution of the synopsis.
Staff recommends amending subsection (2)(e) to state that, within 15 days after the rate case time schedule has been posted on the Commission website, the utility shall prepare and submit a customer notice to Commission staff for approval. The requirements for the customer notice would remain the same, except that the utility would be required to identify the link on the utility’s website which accesses the MFRs. Recommended amendments to this rule codify existing agency procedure and would require that the customer notice: designate the docket number assigned to the petition; have a statement indicating that written comments regarding the proposed changes in rates and charges should be addressed to the Office of Commission Clerk; and specify that comments regarding service may be made to the Commission’s Office of Consumer Assistance and Outreach. Staff recommends amending subsection (2)(f) to require the utility to send the notice to customers within 30 days after it has been approved by Commission staff. All of these recommended amendments to the current rule would enable and ensure greater technological public participation in the process.
The noticing procedures for a limited proceeding filed pursuant to draft Rules 25-6.0431 and 25-7.0391 are stated in draft Rule 25-22.0406(3)(a) through (c). Under subsection (3)(a), the utility would be required to establish a clearly identifiable link on the utility’s website to the address on the Commission’s website to provide electronic access to all documents filed in the limited proceeding. Staff recommends the adoption of this amendment as it provides for electronic access which would increase public knowledge regarding the pending rate case. The mandatory contents of the customer notice for limited proceedings would be nearly identical to those required for general rate increases. Like the customer notices in general rate proceedings, the customer notices in limited proceedings would be required to be sent to the customers within 30 days after the notice has been approved by Commission staff.
Staff recommends that subsections (4) through (8) be added to the rule to address noticing in both limited proceedings and general rate cases. Subsection (4) would require all customer notices to be sent to the customer’s address of record in the manner in which the customer typically receives the monthly bill, whether electronically or via U.S. mail. Subsection (5) would require that all customer notices regarding locations and time of service hearings or customer meetings be sent to customers no less than 10 days and no more than 45 days prior to the first service hearing or customer meeting. Staff believes that these amendments would provide for more direct and efficient exchange of information between the utility and the customer regarding general rate increases and limited proceedings.
Current subsection (6) of Rule 25-22.0406 requires that at least seven days, and not more than 20 days, prior to each service hearing, a display advertisement approved by the Commission staff shall be published in a newspaper of general circulation in the area in which the hearing is to be held. Staff recommends the amendment of the rule to state that the display advertisement requirement applies to any service hearing or customer meeting. The only amendment to subsection (8) would codify agency procedure by stating that the notice of revised rates must be approved by Commission staff, not the Commission.
Statement of Estimated Regulatory Cost (SERC)
Section 120.54(3), F.S., encourages each agency to prepare a statement of estimated regulatory cost (SERC) before the adoption, amendment, or repeal of any rule. The SERC is appended to this recommendation as Attachment B. The SERC includes an economic analysis pursuant to subparagraph 120.541(2)(a)1, F.S., showing whether the draft rules directly or indirectly are likely to have an adverse impact on economic growth, private sector job creation or employment, or private sector investment in excess of $1 million in the aggregate within five years after the implementation of the rules. In addition, the SERC includes an economic analysis pursuant to subparagraph 120.541(2)(a)2, F.S., showing whether the draft rules directly or indirectly are likely to have an adverse impact on business competitiveness in excess of $1 million in the aggregate within five years after the implementation of the rule.
The SERC includes an economic analysis pursuant to subparagraph 120.541(2)(a)3, F.S., showing whether the draft rule directly or indirectly is likely to increase regulatory costs, including any transaction costs, in excess of $1 million in the aggregate within five years after implementation of the rules. The SERC states that none of the draft rule amendments are expected to introduce new transaction costs or costs to the agency, which are the two components of regulatory costs. The SERC concludes that the draft rule amendments and the new rules will not have any of the adverse impacts on the economic measures identified in subparagraphs 120.54(2)(a)1, 2, and 3, F.S., and will not require legislative ratification pursuant to subparagraph 120.54(3), F.S.
Based upon the above, staff recommends that the Commission propose the adoption of Rules 25-6.0431 and 25-7.0391, F.A.C., and the amendments to Rule 25-22.0406, F.A.C., as set forth in Attachment A.
Issue 2:
Should this docket be closed?
Recommendation:
Yes. If no requests for hearing or comments are filed, the rules may be filed with the Department of State, and then this docket may be closed. (Cowdery, Page)
Staff Analysis:
If no requests for hearing or comments are filed, the rules may be filed with the Department of State, and then this docket may be closed.
25-6.0431 Petition for a Limited Proceeding
A petition for a limited proceeding shall include:
(1) A list of all issues the petitioner believes should be decided;
(2) A detailed statement of the reason(s) why the limited proceeding has been requested and why a limited proceeding is the appropriate type of proceeding for consideration of the requested relief;
(3) A schedule showing the specific rate base components for which the utility seeks recovery, on both a system and jurisdictional basis, if the utility is requesting recovery of rate base components;
(4) A detailed description of the expense(s) requested on both a system and jurisdictional basis, if the utility is requesting recovery of operating expenses;
(5) A schedule showing how the utility proposes to allocate any change in revenues to rate classes, and the proposed rates, if the petition requests a change in retail rates; and
(6) Any other information that the utility deems relevant.
Rulemaking Authority: 350.127(2), 366.05, 366.06(1), FS. Law Implemented: 366.05(1), 366.06(1), 366.076(1), FS. History – New____________.
Rule 25-7.0391 Petition for a Limited Proceeding
A petition for a limited proceeding shall include:
(1) A list of all issues the petitioner believes should be decided;
(2) A detailed statement of the reason(s) why the limited proceeding has been requested and why a limited proceeding is the appropriate type of proceeding for consideration of the requested relief;
(3) A schedule showing the specific rate base components for which the utility seeks recovery, on both a system and jurisdictional basis, if the utility is requesting recovery of rate base components;
(4) A detailed description of the expense(s) requested on both a system and jurisdictional basis, if the utility is requesting recovery of operating expenses;
(5) A schedule showing how the utility proposes to allocate any change in revenues to rate classes, and the proposed rates, if the petition requests a change in retail rates; and
(6) Any other information that the utility deems relevant.
Rulemaking Authority: 350.127(2), 366.05, 366.06(1), FS. Law Implemented: 366.05(1), 366.06(1), 366.076(1), FS. History – New____________.
25-22.0406 Notice and Public
Information on General Rate Increase Requests and Petitions for Limited
Proceedings by Electric, and Gas and Telephone Companies
Utilities.
(1) The provisions of
this rule shall be applicable to all requests for general rate increases and
to all limited proceedings filed by electric and gas utilities pursuant to
Rules 25-6.0431 and 25-7.0391. by electric, gas and telephone companies
subject to the Commission’s jurisdiction.
(2) The following noticing procedures shall apply to requests for a general rate increase:
(a) Upon
filing a petition for a general rate increase, Tthe utility
shall mail a copy of the petition to the chief executive officer of the
governing body of each municipality and county within the service area
affected.
(b) The utility shall establish a clearly identifiable link on the utility’s website to the address on the Commission’s website that provides electronic access to all documents filed in the rate case.
(c) Location of Minimum Filing Requirements.
1.(3)(a)
Within 15 days after it has been notified by the Commission that the Minimum
Filing Requirements (MFRs) have been met, the utility shall place a copy of the
MFRs at its official headquarters and at a location approved by the
Commission staff its business office in each municipality in which
service hearings were held in the last general rate case of the utility.
2. Within 15
days after the time schedule has been posted on the Commission’s website
mailed to the utility, copies of the MFRs shall be placed in a
location approved by Commission staff the utility business office in
each additional city in which service hearings are to be held in the current
rate case. Upon customer request a copy of the MFRs shall be placed in a
utility business office not located in a city where a service hearing is to be
held. The copies of the MFRs shall be available for public inspection during
the utility’s regular business hours.
3.(b)
In addition to the locations listed above, if the Commission staff
determines that the locations listed above will not provide adequate access,
the Commission staff will require that copies of the MFRs be placed at
other specified locations.
4. Copies of the MFRs shall be available for public inspection during the regular business hours of the location hosting the MFRs and through a link on the utility’s website.
(d) Rate Case Synopsis.
1.(4)(a)
Within 15 days after the time schedule for the case has been posted to the
Commission’s website, mailed to the utility, the utility shall
prepare and submit to the Commission staff for approval and
distribute a synopsis of the rate request. The synopsis shall be
approved by the Commission or its staff prior to distribution and shall
include:
a.1 A
summary of the section of the MFRs showing a comparison of the present and
proposed rates for major services;
b.2 A
statement of the anticipated major issues involved in the rate case;
c.3 A
copy of the executive summary filed with the MFRs;
d.4 A
description of the ratemaking process and the time schedule established for the
rate case; and
e.5 The
locations at which complete MFRs are available.
2. (b) Within
7 days following approval of the synopsis, cCopies of the
synopsis shall be distributed to the same locations as required for the MFRs,
to the main county library within or most convenient to the service area,
and to the chief executive officer of each county and municipality within the
service area affected.
(e)(5) Within 15 30
days after the rate case time schedule has been posted on the Commission’s
website, mailed to the utility, the utility shall prepare and
submit a customer notice to Commission staff for approval. The customer notice
shall include: begin sending a notice approved by the Commission or its
staff to its customers containing:
1.(a) A statement that the utility has
applied for a rate increase and the general reasons for the request;
2.(b) The locations at which copies of
the MFRs and synopsis are available, including the link on the utility’s
website;
3.(c) The time schedule established for
the case, and the dates, times and locations of any hearings that have been
scheduled; and
4.(d) A comparison of current rates and
service charges and the proposed new rates and service charges;. Such notice
shall be completed at least 10 days prior to the first scheduled service
hearing.
5. The docket number assigned to the petition by the Commission’s Office of Commission Clerk;
6. A statement that written comments regarding the proposed changes in rates and charges should be addressed to the Office of Commission Clerk, 2540 Shumard Oak Boulevard, Tallahassee, Florida, 32399-0850, and that such correspondence should include the docket number; and
7. A statement that comments regarding service may be made to the Commission’s Office of Consumer Assistance and Outreach at this toll free number: (800) 342-3552.
(f) The utility shall begin sending the notice to customers within 30 days after it has been approved by Commission Staff.
(3) The following noticing procedures shall apply to a petition for a limited proceeding filed pursuant to Rules 25-6.0431 and 25-7.0391:
(a) The utility shall establish a clearly identifiable link on the utility’s website to the address on the Commission’s website that provides electronic access to all documents filed in the limited proceeding.
(b) Within 15 days after the time schedule for the limited proceeding has been posted to the Commission’s website, the utility shall prepare and submit a customer notice to the Commission staff for approval. The customer notice shall contain:
1. A statement that the utility has requested a change in rates, a statement of the amount requested, and the general reason for the request;
2. A statement of where and when the petition and supporting documentation are available for public inspection, including the link on the utility’s website;
3. A comparison of the current and proposed rates;
4. The utility’s address, telephone number, and website address;
5. The docket number assigned to the petition by the Commission’s Office of Commission Clerk;
6. A statement that written comments regarding the proposed changes in rates and charges should be addressed to the Office of Commission Clerk, 2540 Shumard Oak Boulevard, Tallahassee, Florida, 32399-0850, and that such correspondence should include the docket number; and
7. A statement that comments regarding service may be made to the Commission’s Office of Consumer Assistance and Outreach at this toll free number: (800) 342-3552.
(c) The utility shall begin sending the notice to customers within 30 days after it has been approved by staff.
(4) All customer notices prepared pursuant to this rule shall be sent to the customer’s address of record at the time the notice is issued, in the manner in which the customer typically receives the monthly bill, whether electronically or via U.S. mail.
(5) All customer notices regarding the locations and time of any service hearings or customer meetings shall be sent to the customer no less than 10 days, or more than 45 days, prior to the first service hearing or customer meeting.
(6) At least 7 days and not more than 20 days prior
to any each service hearing or customer meeting,
the utility shall have published in a newspaper of general circulation in the
area in which the hearing or customer meeting is to be held a display
advertisement stating the date, time, location and purpose of the hearing or
customer meeting. The advertisement shall be approved by the Commission or
its staff prior to publication.
(7) When the Commission issues proposed agency action
and a hearing is subsequently held, the utility shall give written notice of
the hearing to its customers at least 14 days in advance of the hearing. This
notice shall be approved by the Commission or its staff prior to
distribution.
(8) After the Commission’s issuance of an order
granting or denying a rate change, the utility shall give notice to its
customers of the order and the revised rates. The notice shall be approved in
advance by the Commission or its staff and transmitted to the customers
with the first bill containing the new rates.
Rulemaking Specific Authority:
350.127(2), 366.05, 366.06(1) FS. Law Implemented: 120.569, 120.57,
364.01(4), 364.035(1), 364.04(3), (4), 364.05(1), (2), 364.19, 366.03,
366.041(1), 366.05(1), 366.06(1), 366.076(1) FS.
History—New 9-27-83, Formerly 25-22.406, Amended 5-27-93, 5-3-99, _____________.