Shippers has compared a throughput which includes nonjurisdictional volumes to a throughput which does not. Nonjurisdictional volumes were properly excluded from AER's Statement K jurisdictional rate design volumes. In view of AER's inclusion of Line AC costs the filing must be examined for consistency with the Commission's certificate order in Docket No. CP89-2174-000. As discussed above, the Commission has not approved the abandonment, transfer and sales of Line AC capacity and AER facilities. Also, the Commission granted the certificate authority conditioned upon AER's bearing the risk of underutilization of the facilities. In the certificate order, the Commission stated its intention to ensure that present and future customers are not required to make inappropriate contributions to the costs associated with the facilities. The Commission noted that this can be accomplished in various ways and would continue to address the issue in the ongoing rulemaking proceeding in Docket No. RM90-1-000. AER was advised that it may seek to satisfy the "at risk" condition in a section 4 rate case where it seeks to include in rate base the costs of the facilities. However, the Commission stated that when AER sought to recover the costs of the facility, as in the instant filing, it would be placed "at risk" by being allowed to recover only the costs associated with the capacity for which it has executed firm contracts. 13 The Commission noted that these contracts would have to be at least equal to the term required to meet the Commission's contract standards in traditional 7(c) certificates and that most construction is supported by contracts with terms of ten years or more. 14 AER's filing when made was deficient regarding the information necessary for a determination as to whether AER's filing meets this "at risk" condition. Consequently, a data request was sent to AER by the Director of the Office of Pipeline and Producer Regulation requesting the information needed for a decision regarding the "at risk" condition. On January 22, 1991, AER responded to the data request. In its response, AER states that Line AC is an integrated part of its system and therefore AER did not differentiate in its rate case between Line AC volumes and other volumes. AER's response shows that currently the longest contracts for Line AC are for three years. AER also states that it took the risk for the costs of the full capacity of Line AC (1 Bcf per day) by only filing to recover the costs for the portion of Line AC (450,000 MMBtu per day) AER desired to retain. Further, AER claims that Line AC represents a cost savings to its customers of approximately five cents per MMBtu in this case. AER has not demonstrated that it has longterm firm contracts that support utilization of Line AC. Accordingly, AER has not satisfied the "at risk" condition and must remain at risk for the costs of Line AC. Therefore, the Commission will order AER to remove from its filing the costs of Line AC.15 This is without prejudice to AER showing that these costs are justified on a prospective basis. Section 154.63(e)(2)(ii) of the Commission's regulations will be waived to allow AER to include the cost of facilities not yet certificated, subject to AER refiling its rates by June 30, 1991, to remove the costs of all facilities which have not been certificated and placed in service by the end of the test period. Suspension Based upon a review of the filing, the Commission finds that the proposed tariff sheets have not been shown to be just and reasonable, and may be unjust, unreasonable, unduly discriminatory, or otherwise unlawful. Accordingly, the Commission shall accept the tariff sheets for filing, and suspend their effectiveness for the period set forth below, subject to the conditions set forth in this order. The Commission's policy regarding rate suspensions is that rate filings generally should be suspended for the maximum period permitted by statute where preliminary study leads the Commission to believe that the filing may be unjust, unreasonable, or that it may be inconsistent with other statutory standards. See Great Lakes Gas Transmission Co., 12 FERC ¶ 61,293 (1980) (five-month suspension). It is recognized, however, that shorter suspensions may be warranted in circumstances where suspensions for the maximum period may lead to harsh and inequitable results. See Valley Gas Transmission, Inc., 12 FERC ¶61,197 (1980) (one-day suspension). Such circumstances do not exist here for the tariff sheets listed in Appendix A as they effect a rate increase. Therefore, the Commission shall exercise its discretion to suspend those rates for the maximum period and permit the rates to take effect integral part of its system, it did not separate Line AC volumes from its total system throughput. Consequently, the Commission cannot make a corresponding adjustment for the volumes. on July 1, 1991, subject to refund and subject to the conditions set forth in the body of this order and in the ordering paragraphs below. The tariff sheets listed in Appendix B filed pursuant to Order No. 493-A will be permitted to take effect on February 1, 1991, subject to refund and subject to the conditions set forth in the body of this order and in the ordering paragraphs below. The Commission orders: (A) The tariff sheets filed by AER and identified in Appendix A of this order are accepted for filing and suspended for five months to become effective July 1, 1991, subject to refund, and subject to the conditions set forth in this order and in the ordering paragraphs below. (B) The tariff sheets filed by AER pursuant to Order No. 493-A and identified in Appendix B of this order are accepted for filing and suspended to become effective February 1, 1991, subject to refund, and subject to further review. (C) Within 30 days of the issuance date of this order, AER shall file new tariff sheets reflecting that the costs of Line AC have been removed from the rate base. (D) The motions to intervene out-of-time filed by the persons listed in Appendix C of this order are granted subject to the rules and regulations of the Commission; provided, however, that participation of the intervenors shall be limited to the matters affecting rights and interests set forth in their motions to intervene; and provided, further, that the admission of such intervenors shall not be construed as recognition that they might be aggrieved by any order entered in this proceeding. (E) Waiver of section 154.63(e)(2)(ii) of the Commission's regulations is granted subject to AER refiling its rates by June 30, 1991, to remove the costs of all facilities not certificated and placed in service by May 31, 1991. (F) Pursuant to the authority of the Natural Gas Act, particularly sections 4, 5, and 15 thereof, and the Commission's rules and regulations, a public hearing shall be held in Docket No. RP91-65-000 concerning the lawfulness of AER's proposed rate filing. (G) A presiding administrative law judge, to be designated by the Chief Administrative Law Judge for that purpose pursuant to 18 C.F.R. § 375.304 shall convene a prehearing conference in this proceeding to be held within 10 days after service of staff top sheets, in a hearing or conference room of the Federal Energy Regulatory Commission, 810 First Street, NE., Washington, DC 20426. The prehearing conference shall be held for the purpose By Direction of the Commission: Lois D. Cashell, Secretary. On December 17, 1990, K N Energy, Inc. (K N) filed a request for waiver of section 19 of its General Terms of Conditions and section 154.302(j) of the Commission's regulations to recover certain transportation charges under its PGA mechanism. The transportation charges will result from K N's total conversion of sales to firm transportation on Northern Natural Gas Company (Northern) and the use of the transportation on Northern. K N proposes to adjust its rates to reflect the approval of this waiver in its next quarterly PGA filing to be effective March 1, 1991. The waiver is requested for the period January 1 through October 27, 1991, which is the date the K NNorthern service agreement terminates. The Commission grants K N's waiver request herein for the limited period of January 1 through October 27, 1991. Notices of intervention and unopposed timely filed motions to intervene are granted pursuant to the operation of Rule 214 of the Commission's Rules of Practice and Procedure (18 C.F.R. section 385.214). Any opposed or untimely filed motion to intervene is governed by the provisions of Rule 214. This acceptance for filing shall not be construed as a waiver of the requirements of section 7 of the Natural Gas Act, as amended, nor shall it be construed as constituting approval of the referenced filing or of any rate, charge, classification, or any rule, regulation, or practice affecting such rate or service contained in your tariff; nor shall such acceptance be deemed as recognition of any claimed contractual right or obligation associated therewith; and such acceptance is without prejudice to any findings or orders which have been or may hereafter be made by the Commission in any proceeding now pending or hereafter instituted by or against your company. [¶ 61,083] Florida Gas Transmission Company, Docket No. TQ91-2-34-000 (Issued January 18, 1991) By Direction of the Commission: Lois D. Cashell, Secretary. Reference: Ninth Revised Sheet No. 8 to FERC Gas Tariff, Second Revised Volume No. 1. Florida Gas Transmission Company (Florida Gas) filed the above-referenced tariff sheet reflecting an out-of-cycle PGA to be effective January 1, 1991. The filing reflects an increase of 0.40 per therm in the D-1 component and a decrease of 0.039 per therm in the D-2 component for its Rate Schedule G service and similar changes in its other rate schedules. The subject filing is accepted effective January 1, 1991, subject to refund, and subject to the outcome of the underlying Southern Natural Gas Company (Southern) proceedings in Docket Nos. RP91-69-000 and RP90-139-000 et al. The filing tracks a general rate increase filed by Southern in Docket No. RP90-139-000 which was suspended until January 1, 1991, by Commission order issued July 27, 1990. 52 FERC 61,094 (1990). However, on December 28, 1990, in Docket No. RP90-139-004, Southern filed revised rates which differ from those 3 13 1 originally suspended in Docket No. Notices of intervention and unopposed (18 C.F.R. section 385.214). Any opposed or untimely filed motion to intervene is governed by the provisions of Rule 214. This acceptance for filing shall not be construed as a waiver of the requirements of section 7 of the Natural Gas Act, as amended, nor shall it be construed as constituting approval of the referenced filing or of any rate, charge, classification, or any rule, regulation, or practice affecting such rate or service contained in your tariff; nor shall such acceptance be deemed as recognition of any claimed contractual right or obligation associated therewith; and such acceptance is without prejudice to any findings or orders which have been or may hereafter be made by the Commission in any proceeding now pending or hereafter instituted by or against your company. [¶ 61,084] Montaup Electric Company (represented by Bruder, Gentile, & Marcoux), Letter Order (Issued January 23, 1991) By Direction of the Commission: Lois D. Cashell, Secretary. On October 23, 1990, you filed an uncontested partial settlement agreement among Montaup Electric Company, the Town of Middleborough, Massachusetts, the Pascoag, Rhode Island, Fire District, the Attorney General of Rhode Island, the Rhode Island Division of Public Utilities and Carriers, the Massachusetts Department of Public Utilities, and the Conservation Law Foundation of New England, Inc. On November 9, 1990, staff submitted comments in support of the settlement. No other comments were received. On November 15, 1990, the presiding administrative law judge certified the uncontested settlement to the Commission. Based on staff's analysis, the settlement rates would not result in a rate of return in excess of staff's recommended 11.01% rate, which includes a 12.00% return on common equity with an equity ratio of 48.05%. The subject partial settlement is in the public interest and is hereby approved. The rates submitted with the settlement are accepted for filing and are designated and made effective as shown on the Enclosure. The Commission's approval of this settlement does not constitute approval of, or precedent regarding, any principle or issue in this proceeding. Within ten (10) days from the date of this letter, any amounts collected in excess of the settlement rates shall be credited together with interest computed under section 35.19a of the Commission's regulations. Within thirty (30) days after making such credits, the Company shall file with this Commission a compliance report showing monthly billing determinants, revenue receipt dates, revenues under the prior, present, and settlement rates, the monthly revenue credit, and the monthly interest computed, together with a summary of such information, for the total credit period. The Company shall furnish copies of the report to the affected wholesale customers and to each state commission within whose jurisdiction the wholesale customers distribute and sell electric energy at retail. This letter terminates Docket No. ER90-247-002, PHASE I. A new subdocket will be assigned in ER90-247 upon receipt of the required compliance refund report. Enclosure Montaup Electric Company Docket No. ER90-247-000 Designation Description (1) Original Sheet Nos. 4.7 through 4.10 Under FPC Electric Tariff, Original Volume No. 1- · Conservation and Load Management Adjustment New England Hydro-Transmission Electric Company, Inc. and New England Hydro-Transmission Corporation (represented by Swidler & Berlin, Chartered), Docket No. ER90-450-000 Letter Order (Issued January 23, 1991) By Direction of the Commission: Lois D. Cashell, Secretary. On November 5, 1990, you filed an offer of settlement in the above-referenced docket. On November 16, 1990, staff submitted comments in support of the settlement. No other comments were received. On November 27, 1990, the presiding administrative law judge certified the uncontested settlement to the Commission. Based on staff's analysis, the settlement rates would not result in a rate of return in excess of staff's recommended 11.2% rate which includes a 13.0% return on common equity with an equity ratio of 40%. The subject settlement is in the public interest and is approved. The settlement rates subImitted with the settlement are accepted for filing and are designated and made effective as shown on the Enclosure. The Commission's approval of this settlement does not constitute approval of, or precedent regarding, any principle or issue in this proceeding. Within sixty (60) days from the date of this letter, any amounts collected in excess of the settlement rate levels shall be refunded together with interest computed under section 35.19a of the Commission's regulations. Within fifteen (15) days after making such refunds, the Company shall file with this Commission a compliance report showing monthly billing determinants, revenue receipt dates, and revenues under the prior, present and settlement rates, the monthly revenue refund, and the monthly interest computed, together with a summary of such information for the total refund period. The Company shall furnish copies of such report to the affected wholesale customers and to each state commission within whose jurisdiction the wholesale customers distribute and sell electric energy at retail. This letter terminates Docket No. ER90-450-000. A new subdocket will be assigned in ER90-450 upon receipt of the required compliance refund report. Enclosure Settlement Rate Designations Effective Date: November 1, 1990 New England Hydro-Transmission Electric Company Designation Description (1) Supplement No. 8 to Rate Schedule FERC No. 1 (Supersedes Supplement No. 7) Offer of Settlement with a 13 % Return Equity on New England Hydro-Transmission Corporation Designation (2) Supplement No. 9 to Rate Schedule FERC No. 1 (Supersedes Supplement No. 7) — Offer of Settlement with a 13% Return on Equity [¶ 61,086] New England Power Company (represented by Swidler & Berlin), Docket No. ER90-284-000 Letter Order |