Voltage turned up in co-op electrical rate caseMar 8 - McClatchy-Tribune Regional News - Jim Kalvelage Ruidoso News, N.M.
The rate increase effort by the power supplier to 12 rural electric cooperatives in New Mexico, including Otero County Electric Cooperative, is heating up. Tri-State Generation and Transmission Association, which supplies electricity to 44 electric cooperatives in four states, filed for a 4.9 percent increase, which the local electric companies would pass through to their members. But the New Mexico Public Regulation Commission late last year blocked the increase and referred the case to a hearing examiner to determine if the planned rate hike was justified. Tri-State since has asked the PRC to allow it to recover, on an interim basis, a part of the revenues it has sought in the initial rate case. In a filing earlier this week, Utility Division Staff with the PRC recommended the hearing examiner deny Tri-State's request that the scope of the review be limited. "In its motion, Tri-State seeks to unlawfully limit commission authority to review its rates," PRC staff council Cydney Beadles wrote in the recommendation. "Tri-State argues that the commission's hearing and review in this matter should be limited to the following four issues which, Tri-State asserts, are the only specific issues common to all three protests." Three electric cooperatives in New Mexico protested the rate increase, a threshold that triggered the PRC review. Issues The four issues Tri-State said should be the only focus of the PRC based on the protesters are the arguments that the rate design fails to reflect cost, it improperly "variablizes" fixed costs, a lack of a cost basis for proposed on-peak and off-peak rates, and that the rate structure discriminates between the electric cooperative members. Beadles added that Tri-State's reading of New Mexico law "would add words to the statute which are not part of the statute as enacted. The plain wording of (the statute) is clear and unambiguous. 'If three or more New Mexico member utilities file protests and the commission determines there is just cause in at least three of the protests for reviewing the proposed rates, the commission shall suspend the rates, conduct a hearing concerning the reasonableness of the proposed rates and establish reasonable rates.' The scope of the commission's review is not limited to the issues that are common to at least three of the protests." Others have asked to intervene in the case, such as Western Resource Advocates, an environment group, and an organization called the Cooperative Consumer Coalition, which includes energy companies that use electricity in New Mexico derived from Tri-State. Another New Mexico electric cooperative, Jemez Electric Co-op, also has asked to be involved in the case. Otero County Electric Cooperative sent a comment letter last month to PRC Chair Ben Hall. The letter replied to aletter from Tri-State to the PRC. Otero County Electric General Manager Carroll Waggoner said Tri-State's letter implied that the nine New Mexico electric cooperatives that did not file protests agreed with the rate design. "In our case, that is not correct," Waggoner wrote. "OCEC did not file a protest because the threshold level (to require PRC review) was met thereby affording the commission the opportunity to review the rate, which was needed. The commission's decision to suspend the rate now affords the other cooperatives opportunity to participate in the regulatory process, which we fully intend to do." In the Jan. 25 correspondence, Tri-State requested the PRC allow interim rates to take effect while the rate case continued, with the protesting New Mexico co-ops paying one interim rate and the nine non-protesting utilities paying a different rate. "Tri-State believes that it is appropriate, fair, and equitable to employ interim rates that balance the respective interests of all 12 New Mexico member systems while enabling Tri-State to still recover a portion of the necessary revenues from its New Mexico member systems," Tri-State General Manager Kenneth Anderson said. "According, Tri-State proposed to collect the revenue requirement on an interim basis by billing the protesters under (one) rate design and the non-protesters under (another) rate design." Anderson said otherwise Tri-State would realize a revenue shortfall of $14.5 million this year because of the suspension of the rate increase that was proposed to take effect at the first of this year. A hearing in the original rate case has been tentatively scheduled for October. Tri-State, meanwhile, has gone into federal court in an effort to void the PRC hearing. In the case seeking injunctive relief, the Colorado-based power supplier said they are involved in interstate commerce and as a result PRC regulation of Tri-State's wholesale electric rates violates the Commerce Clause of the U.S. Constitution. http://www.energycentral.com/functional/news/news_detail.cfm?did=27852533 |