Case Background
On
September 7, 2016, Tampa Electric Company (Tampa Electric or company) filed a
petition for approval of tariff changes to implement a previously approved step
increase. This step increase was approved in Order No. PSC-13-0443-FOF-EI, in
which the Commission approved a stipulation and settlement agreement in Tampa
Electric’s 2013 rate case (Settlement Order). The Settlement Order provides a phased-in
approach to the rate increase: a $57.5 million increase effective November
2013, a $7.5 million increase effective November 2014, and a $5 million
increase effective November 2015. The final increase approved in the Settlement
Order is the Polk Generation Base Rate Adjustment (Polk GBRA) of an additional $110
million of annual revenues. Pursuant to the settlement agreement, the Polk GBRA
is effective with the first billing cycle of January 2017 or the commercial
in-service date of the Polk Conversion Project, whichever is later.
Section
366.05(1)(e), Florida Statutes, (F.S.) states that new tariffs and changes to
an existing tariff, other than an administrative change that does not
substantially change the meaning or operation of the tariff, must be approved
by the majority vote of the Commission, except as otherwise specifically
provided by law. Staff’s recommendation addresses Tampa Electric’s proposed
tariffs to implement the $110 million Polk GBRA rate increase. The Commission
has jurisdiction over this matter pursuant to Chapter 366.04, 366.05, and
366.06, F.S.
Discussion
of Issues
Issue 1:
Should the Commission approve Tampa Electric’s
tariff changes to implement the Polk GBRA increase approved in the Settlement Order?
Recommendation:
Yes, the Commission should approve Tampa Electric’s
tariff changes to implement the Polk GBRA increase approved in the Settlement Order.
Pursuant to the Settlement Order, the Polk GBRA rate changes should become effective
with the first billing cycle of January 2017, or the commercial in-service date
of the Polk Conversion Project, whichever is later. Tampa Electric should
notify its customers of the approved new rates in the December 2016 bills.
(Guffey)
Staff Analysis:
Tampa Electric’s petition
includes the proposed tariff sheets, the allocation of the revenue increase to
the various rate classes, calculations showing the revenue from the sale of
electricity by rate schedule under current and proposed rates, and a comparison
of monthly bills for the major rate classes. A residential customer who uses
1,000 kilowatt-hours (kWh) per month will see an increase of $6.68 on the base
rate portion of the monthly bill as a result of the Polk GBRA increase.
However, the company also proposed in the cost recovery clause dockets a decrease
in the fuel, capacity, and environmental charges which, if approved, would
result in an overall decrease in residential customer bills of $1.54 per month
in 2017.
Pursuant to the settlement, the Polk
GBRA is allocated to all rate classes based on each class’s percentage of total
base revenues calculated using the base rates in effect on December 1, 2016,
and the company’s projected 2017 billing determinants consistent with the
company’s clause filing for 2017. The class revenue increases are then allocated
to all base rates and credits at an equal percentage (10.8 percent). Attachment
A to this recommendation shows current and proposed base rates for major rate
classes.
Tampa Electric states that, at
this time, the Polk Conversion project is still under construction with a
planned in-service date of January 16, 2017; however, this in-service date is
not certain. Tampa Electric will notify staff of the commercial in-service date
of the Polk Conversion project.
Staff has reviewed Tampa
Electric’s proposed tariff sheets and supporting documentation. The calculations
are correct and reflect the Settlement Order. The Commission should approve
Tampa Electric’s tariff rate changes to implement the step increase approved in
the Settlement Order. Pursuant to the Settlement Order, the rate changes should
become effective with the first billing cycle of January 2017 or the in-service
date of the Polk Conversion Project, whichever is later. Tampa Electric should
notify its customers of the approved new rates in the December bills.
Issue 2:
Should this docket be closed?
Recommendation:
Yes, if the Commission approves Issue I, this docket
should be closed. (Brownless)
Staff Analysis:
If the Commission approves Issue 1, this docket
should be closed.
Present and Proposed Rates
for Major Rate Classes
|
Rate Class
|
Charge
|
Current
Rate
|
Proposed Rate
|
|
Residential Service
|
Basic Service Charge
Energy Charge (1st
1,000 kwh)
Energy Charge (above 1,000 kwh)
|
$15.00
4.694 ȼ/kwh
5.694 ȼ/kwh
|
$16.62
5.200 ȼ/kwh
6.308 ȼ/kwh
|
|
General Service –
Non Demand
|
Basic Service Charge
Energy Charge
|
$18.00
5.009 ȼ/kwh
|
$19.94
5.549 ȼ/kwh
|
|
General Service –
Demand
|
Basic Service Charge
Energy Charge
Demand Charge
|
$30.00
1.583 ȼ/kwh
9.25 $/kw
|
$33.24
1.754 ȼ/kwh
10.25 $/kw
|
|
Interruptible Service (closed to new businesses as of
5/7/2009)
|
Basic Service Charge
Energy Charge
Demand Charge
|
$622.00
2.504 ȼ/kwh
1.45 $/kw
|
$689.11
2.774 ȼ/kwh
1.61 $/kw
|
Source: TECO revised tariff sheets 6.030, 6.050, 6.080,
6.085, 6.806
