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PUC Adopts Design For New Purchase Of Receivables Program
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The New Hampshire PUC approved the key elements for the design of a new purchase of receivable program at Granite State Electric (Liberty Utilities), but final implementation of the program is reserved to a second phase of the proceeding which is to address conforming tariffs
The New Hampshire PUC generally approved the POR program as designed in a settlement among Granite State Electric and various parties. In doing so, the PUC rejected recommendations from a hearing examiner on the allocation of certain costs (discussed further below)
The POR program at Granite State Electric is to be open to retail suppliers in addition to municipal aggregations, and will be required to be used for any bills rendered under utility consolidated billing
A unique discount rate will apply to the small customer group, and a separate unique discount rate will apply to the large customer group. However, in the first year of POR, a single discount rate will apply to allow the utility to collect further data on class-specific discount rates
The discount rate for each customer group will reflect uncollectibles, administrative costs, and a reconciliation factor
A hearing examiner had proposed to make changes to the POR program designed by the settlement. In particular, the hearing examiner said that the settlement's proposed POR program failed to include a pro rata share of baseline utility collection efforts costs, which the examiner said is required by statute. The hearing examiner also faulted the failure of the settlement to assign any existing administrative costs to POR, and further called unsupported the settlement's setting of utility working capital costs associated with offering POR to zero
Specifically, the hearing examiner said that the POR law's language that a "pro rata share" of costs shall be allocated to POR does not mean only "incremental costs", or "additional or increased costs", as argued by parties to the settlement. The hearing examiner thus said that the POR design under the settlement, which allocated only incremental costs to POR, did not comply with statute
However, the PUC found that the settlement's proposed discount rate does comply with the statute as the settlement's POR design accounts for costs arising from the POR program, including any working capital needs if any such working capital costs are later identified by GSE
The PUC cited its recent similar decision adopting a POR design at Unitil, in which the PUC found that defining "pro rata share" to mean all costs, not just incremental costs, would inappropriately require users of POR to pay for costs unrelated to the creation and operation of the POR program. Statute does not require working capital costs or collection costs which are not attributable to the POR program to be included in the POR discount, the PUC said
The only part of the settlement that the PUC did not approve was an annual date of May 1 for the effective date of new discount rates. Given that the annual discount rate updates are required to be filed by March 1, the PUC said that a May 1 effective date did not provide enough time for review of the updated rates. The PUC set August 1 as the annual effective date for POR reconciliations, unless otherwise ordered by the PUC
The start date for POR will be determined by the second phase of the proceeding addressing tariffs and changes to the GSE supplier services agreement to implement the program
Docket DE 23-003
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August 16, 2024
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Copyright 2024 EnergyChoiceMatters.com
Reporting by Paul Ring • ring@energychoicematters.com
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