additional revenues from ratepayers by placing that very same plant (at its depreciated value) in rate base. I&E speculates that, if the Commission does not adjust rate Columbia’s base, it is likely that other utilities that have repaid PennVest loans with customer-provided funds would attempt to follow suit and include the undepreciated value of their plant in rate base. at 10. Id. I&E states that it appears that the ALJ was aware of the potential adverse precedential effect of his recommendation because he attempted to limit its applicability by stating that the regulatory history of this PennVest he would have “but for” “unique plant,” been to accept proposed adjustment. at 11, citing R.D. at 39. Id. “strongly inclined” I&E’s I&E submits that it is unlikely that the qualification would be recognized by other ALJ’s utilities that become aware that Columbia received full recovery through a surcharge methodology and then received rate base treatment for the same plant. Id. As support for its argument that the Company cannot recover the principal amount of a PennVest loan, plus interest, that is used to finance plant, and then include the undepreciated value of the plant in rate base, I&E refers to the PennVest Commission’s which states, in relevant part, that: Policy Statement, Companies with outstanding PENNVEST loans not currently reflected in rates and companies that will receive PENNVEST loans in the future are encouraged to establish under 66 Pa. C.S. § 1307(a) (relating to sliding scale of rates; adjustments) and subject to Commission approval, an automatic adjustment by means of a sliding scale of rates limited solely to the recovery of PENNVEST principal and interest obligations, instead of seeking recovery of these amounts under 66 Pa. C.S. § 1308 (relating to voluntary changes in rates) base rate filing. 52 Pa. Code § 69.361 (emphasis added). I&E submits that the PennVest Policy Statement demonstrates that a utility may finance plant additions through rate base inclusion either or through a PennVest surcharge on its customers, but not both. at 12-13. In conclusion, Id.
additional revenues from ratepayers by placing that very same plant (at its depreciated value) in rate base. I&E speculates that, if the Commission does not adjust Columbia’s rate base, it is likely that other utilities that have repaid PennVest loans with customer-provided funds would attempt to follow suit and include the undepreciated value of their plant in rate base. Id. at 10. I&E states that it appears that the ALJ was aware of the potential adverse precedential effect of his recommendation because he attempted to limit its applicability by stating that “but for” the “unique regulatory history of this PennVest plant,” he would have been “strongly inclined” to accept I&E’s proposed adjustment. Id. at 11, citing R.D. at 39. I&E submits that it is unlikely that the ALJ’s qualification would be recognized by other utilities that become aware that Columbia received full recovery through a surcharge methodology and then received rate base treatment for the same plant. Id. As support for its argument that the Company cannot recover the principal amount of a PennVest loan, plus interest, that is used to finance plant, and then include the undepreciated value of the plant in rate base, I&E refers to the Commission’s PennVest Policy Statement, which states, in relevant part, that: Companies with outstanding PENNVEST loans not currently reflected in rates and companies that will receive PENNVEST loans in the future are encouraged to establish under 66 Pa. C.S. § 1307(a) (relating to sliding scale of rates; adjustments) and subject to Commission approval, an automatic adjustment by means of a sliding scale of rates limited solely to the recovery of PENNVEST principal and interest obligations, instead of seeking recovery of these amounts under 66 Pa. C.S. § 1308 (relating to voluntary changes in rates) base rate filing. 52 Pa. Code § 69.361 (emphasis added). I&E submits that the PennVest Policy Statement demonstrates that a utility may finance plant additions either through rate base inclusion or through a PennVest surcharge on its customers, but not both. Id. at 12-13. In conclusion,
1266459.docx