Case Background
Rule
25-17.015(1), Florida Administrative Code (F.A.C.), directs the Florida Public
Service Commission (Commission) to set an annual evidentiary hearing in its
continuing Energy Conservation Cost Recovery (ECCR) docket pursuant to Sections
366.80-366.83, Florida Statutes (F.S.), to allow public utilities to seek
recovery of costs for energy conservation programs. An evidentiary hearing is
set for November 5-7, 2018.
On June 28,
2018, Peoples Gas System (Peoples) filed a Petition for Waiver of Rule 25-17.015(1)(b),
F.A.C., (Petition). Rule 25-17.015(1)(b), F.A.C., requires utilities to submit
actual and estimated filings based upon eight months of actual costs and four
months of projected costs. A Notice of Joinder to the Petition was filed July
2, 2018, by Florida Public Utilities Company (FPUC), Florida Division of Chesapeake Utilities
Corporation (Chesapeake), Florida Public Utilities Company-Fort Meade (Ft.
Meade), and Florida Public Utilities Company-Indiantown Division (Indiantown).
A Notice of Joinder to the Petition was also filed on July 3, 2018, by Florida
City Gas (FCG); on July 5, 2018, by St. Joe Natural Gas Company (St. Joe); and
on July 11, 2018, by Sebring Gas System, Inc. (Sebring).
Pursuant to
Section 120.542(6), F.S., notice of the Petition was published in the Florida
Administrative Register on July 13, 2018. To date, no comments were received.
The time for filing comments expires on July 27, 2018. By Order No. PSC-2018-0244-PAA-EG,
issued on May 10, 2018, in Docket No. 20180002-EG, the Commission granted a
similar Petition for Waiver of Rule 25-17.015(1)(b), F.A.C., to Florida Power
& Light Company, Duke Energy Florida, LLC, Tampa Electric Company, Gulf
Power Company, and FPUC.
This
recommendation addresses the Petition and corresponding requests for joinder. The Commission has jurisdiction in this
matter pursuant to Sections 120.542, 366.04, 366.05, and 366.06, F.S.
Discussion
of Issues
Issue 1:
Should the Commission grant Peoples Gas System, Florida
Public Utilities Company, Florida Division of Chesapeake Utilities Corporation,
Florida Public Utilities Company-Fort Meade, Florida Public Utilities
Company-Indiantown Division, Florida City Gas, St. Joe Natural Gas Company, and
Sebring Gas System's Petition for waiver of Rule 25-17.015(1)(b), Florida
Administrative Code?
Recommendation:
Yes. Staff recommends that the Commission grant the
Petition for waiver of Rule 25-17.015(1)(b), F.A.C., requested by Peoples Gas
System, Florida Public Utilities Company, Florida Division of Chesapeake
Utilities Corporation, Florida Public Utilities Company-Fort Meade, Florida
Public Utilities Company-Indiantown Division, Florida City Gas, St. Joe Natural
Gas Company, and Sebring Gas System, Inc. The waiver will allow the utilities to
provide annual estimated/actual true-up filings showing six months actual data
and six months of projected data for a period of two years to cover the August
2018 and August 2019 filings. (Dziechciarz, Coston)
Staff Analysis:
Petition
As stated, Peoples, FPUC, Chesapeake, Ft. Meade, Indiantown,
FGC, St. Joe, and Sebring requested a rule waiver of the requirements of Rule
25-17.015(1)(b), F.A.C. The rule requires the utilities to make actual and
estimated filings based upon eight months of actual and four months of
projected common costs, individual program costs, and any collected revenues, beginning
on January 1, 2018 and ending on December 31, 2018. The utilities stated that
the due date for the estimated/actual true-up filing of August 10, 2018, does
not allow the companies to prepare their estimated/actual filings based on
eight months of actual and four months of projected data because the filings
are due before the expiration of the required eight month period. The utilities indicated that they can prepare
their filings on the basis of six months of actual and six months of projected
data. The utilities requested a waiver
of Rule 25-17.015(1)(b), F.A.C., and permission to submit their filings based
on six months of actual data and six months of projected data.
The utilities asserted that filings based on six months of
actual and six months of projected data are a reasonable means of achieving the
purpose of the statutes implemented by Rule 25-17.015(1)(b), F.A.C. The
utilities contended that the impossibility of submitting their filings based on
eight months of actual data and four months of projected data by the August 10,
2018 due date established in the Order Establishing Procedure, Order No.
PSC-2018-0115-PCO-GU, issued March 1, 2018, creates a substantial hardship for
each of them. The utilities further
requested that the waiver be granted for a period of two years to cover the
August 2018 filings and the August 2019 filings.
Facts
Rule 25-17.015, F.A.C., requires the Commission to conduct
annual ECCR proceedings
in November of each year. Rule 25-17.015(1)(b),
F.A.C., requires that the utilities submit actual and estimated filings, based
upon eight months of actual data and four months of projected data, to be used
in the annual proceedings.
The Rule requires that actual costs and revenues should be
calculated beginning January 1st of the year of the annual ECCR proceeding
in which the utility is seeking cost recovery.
As such, the typical actual true-up filing should cover the period of
January 1st – August 31st, and the estimated true-up filing should cover the
period of September 1st – December 31st.
Requirements of Section 120.542, F.S.
Section 120.542(2), F.S., authorizes the Commission to
grant variances or waivers from agency rules when the person subject to the
rule demonstrates that the purpose of the underlying statute will be or has
been achieved by other means and application of the rule would cause the person
substantial hardship. As defined by Section 120.542(2), F.S., “substantial
hardship” means a demonstrated economic, technological, legal, or other type of
hardship.
Purpose of the Underlying Statutes
Sections 366.80-366.83 and 403.519, F.S., are known
collectively as the Florida Energy Efficiency and Conservation Act
(FEECA). The purpose of FEECA is to utilize
the most efficient and cost-effective demand-side renewable energy systems and
conservation systems. Furthermore, FEECA
requires the Commission to determine whether utilities’ energy conservation
programs shall be approved for cost recovery.
In the Petition, the utilities asked for a waiver of the
rule’s requirement for submission of eight months of actual and four months of
projected data. Instead, the utilities
offered to provide actual and estimated true-up filings that consist of six
months of actual data, covering the period of January 1, 2018 – June 30, 2018, and
six months of projected data, covering the period of July 1, 2018 – December
31, 2018, as well as the corresponding periods for the following year’s ECCR docket.
Therefore, the utilities’ ECCR filings
will continue to provide actual and estimated true-up information. The
utilities assert that filings based on six months of actual data and six months
of projected data are a reasonable means of achieving the purpose of Sections
366.80-366.83, F.S.
Staff believes that six months of actual data and six
months of projected data will allow the Commission to determine the utilities’ appropriate
recovery of costs for energy conservation programs during the annual ECCR proceeding
in compliance with the purpose of FEECA.
Furthermore, pursuant to Rule 25-17.015(1)(a), F.A.C., the actual common
costs, individual program costs, and revenues for the period of January 1st –
December 31st, will be submitted in the utilities’ annual true-up filing in the
next year’s ECCR proceeding; this information provides the Commission with the
ability to true-up the six months of actual and six months of projected data. Therefore, staff recommends that the
utilities have demonstrated that the purpose of the underlying statutes will be
achieved through other means by the individual utilities.
Substantial Hardship
As stated, pursuant to Section 120.542(2), F.S., the
petition must demonstrate that application of the rule would create a
substantial hardship. Further, Section 120.542(2), F.S., defines substantial
hardship as demonstrated economic, technological, legal, or other type of
hardship to the person requesting the waiver.
In the Petition, the utilities assert that application of
the rule would create a substantial hardship to them due to the impossibility
of submitting their filings on the basis of eight months of actual data and
four months of projected data as required by the rule and by the August 10,
2018 due date set by the Order Establishing Procedure.
Staff believes that the application of Rule 25-17.015(1)(b),
F.A.C., in the instant docket would create a substantial hardship for the
utilities based on the unavailability of the financial information for the
typical coverage periods for actual data to be gathered between January 1st –
August 31st and estimated data for September 1st – December 31st, by August 10,
2018. Therefore, staff recommends that the utilities have demonstrated that
application of the rule would create a substantial hardship under the current
timeline as set forth in the current hearing schedule.
Conclusion
Section 120.542, F.S., requires companies to demonstrate
that the purpose of the underlying statute will be or has been achieved by
other means by the companies and that application of the rule would create a
substantial hardship. Staff recommends that the Commission find that the utilities
have demonstrated that the purpose of
the underlying statutes will be achieved by filing six months of actual data
and six months of projected data. Staff further
recommends that the utilities have demonstrated that application of Rule
25-17.015(1)(b), F.A.C., will create a substantial hardship to the utilities. Therefore, staff recommends that the
Commission grant the utilities’ Petition for Waiver of Rule 25-17.015(1)(b),
F.A.C., to allow the utilities to provide annual estimated/actual true-up
filings showing six months of actual data and six months of projected data for
a period of two years to cover the August 2018 filings and the August 2019
filings.
Staff has initiated rulemaking to amend Rule
25-17.015(1)(b), F.A.C. On March 20,
2018, a Notice of Development of Rulemaking to amend Rule 25-17.015, F.A.C.,
was published in the Florida Administrative Register. The stated purpose and effect of the rule
development is to streamline the utilities’ filing requirements in the rule. The
proposed rule revision seeks to make the ECCR filing dates less prescriptive,
thereby improving the scheduling of the ECCR filings and subsequent hearing.
Issue 2:
Should this docket be closed?
Recommendation:
No. If no person whose substantial interests are
affected by the proposed agency action files a protest within 21 days of the
issuance of the order, this docket should not be closed upon the issuance of a
consummating order. The ECCR docket is ongoing and this docket should remain
open for further Commission action. (Dziechciarz)
Staff Analysis:
If no person whose substantial interests are affected
by the proposed agency action files a protest within 21 days of the issuance of
the order, this docket should not be closed upon the issuance of a consummating
order. The ECCR docket
is ongoing and this docket should remain open for further Commission action.
