Tag Archives: Utility Law

PUC Orders 17 Utilities to Return $320+ Million to Consumers Following Federal Tax Reform

The Pennsylvania Public Utility Commission (PUC) on May 17, 2018 issued an Order, puc_sealrequiring a “negative surcharge” or monthly credit on customer bills for 17 major electric, natural gas, and water and wastewater utilities, totaling more than $320-million per year. The refunds to consumers are the result of the substantial decrease in federal corporate tax rates and other tax changes under the Tax Cuts and Jobs Act (TCJA) of 2017, which impacted the tax liability of many utilities.

Additionally, the PUC will consider the effects of federal tax reform on seven other public utilities as part of the investigations for rate cases which have already been filed or are expected to be filed by Aug. 1, 2018. In those situations, the Commission has directed the parties involved to address the impact of any TCJA tax savings as part of the overall rate design for each utility.

Today’s Order, along with a series of orders specific to each affected utility, were approved by 5-0 votes. The PUC’s action today follows an extensive investigation into the effects of federal tax reform on the rates charged by Commission-regulated utilities – which, among other things, reflect annual taxes owed both to the federal and state governments.

“As economic regulators, it is the Commission’s responsibility to ensure that utility rates are just and reasonable. Further, it is necessary for utility rates to reflect relevant tax expenses,” noted PUC Chairman Gladys M Brown in a statement at today’s public meeting. “I believe this work (by PUC staff) has resulted in an innovative answer by this Commission to effectively flow-through the benefits of the TCJA back to customers.”

Vice Chairman Andrew G. Place also praised staff’s work in this complex proceeding and agreed with the Commission’s overall approach. However, he indicated that the utilities’ overall cost of capital and rate of return should apply on the accumulated balances of tax savings for the period between January 1 and June 30, 2018.

Depending on the revenue and tax impact on each utility addressed in today’s PUC orders, the distribution charges on monthly consumer bills are expected to decrease from .56-percent to 8.55-percent. A list of the utilities impacted by today’s PUC orders, along with the anticipated changes in distribution rates, has been posted to the online docket for this matter: M-2018-2641242.  Tax Effects

Public utilities required to begin returning federal tax savings to consumers include Citizens’ Electric Company of Lewisburg, Metropolitan Edison Company, Pennsylvania Electric Company, Pennsylvania Power Company, Pike County Light & Power Company, PPL Electric Utilities Corporation, Wellsboro Electric Company, West Penn Power Company, PECO Energy Company (Gas Division), National Fuel Gas Distribution Corporation, Peoples Gas Company LLC, Peoples Natural Gas Company LLC—Equitable Division, UGI Central Penn Gas Inc., UGI Penn Natural Gas Inc., UGI Utilities, Inc.–Gas Division, Pennsylvania-American Water Company and Pennsylvania-American Water Company—Wastewater.

Utilities not required to take immediate action because of the continuing analysis of tax reform impacts on their current or pending rate cases include UGI Utilities, Inc. (Electric), Columbia Gas of Pennsylvania, Inc., Duquesne Light Company, PECO Energy Company (Electric), York Water Company, Suez Water Pennsylvania, Inc. and Aqua Pennsylvania, Inc.  In each of those situations, any tax savings will be considered as part of the broader evaluation of their rates.

The Commission also noted that one Pennsylvania public utility saw no financial impact or an increased federal tax liability as the result of TCJA. Per today’s order, Columbia Water Company is directed to file a tariff or tariff supplement within 10 days, replacing their current rates, which were declared to be “temporary” by Commission action in March 2018.

Finally, the Commission investigation determined that two utilities are receiving only a small increased tax liability from TCJA – Peoples Natural Gas Company LLC and Newtown Artesian Water Company. For these two utilities, the Commission’s previous order declaring their rates to be temporary will continue, subject to annual reconciliation.

Desire more specific assistance regarding PUC matters or energy law, contact attorney Jeffrey A. Franklin at Prince Law Offices, P.C.

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PA PUC ‘Be Utility Wise’ Events; Increasing Awareness about Utility Customer Assistance Programs

puc_sealThe Pennsylvania Public Utility Commission (PUC) is hosting its second of five statewide annual PA “Be Utility Wise” events on Thursday, Oct. 20, 2016, from 8 a.m. to 3:30 p.m., at Mohegan Sun, 1280 Highway 315, Wilkes-Barre, PA. The outreach events will continue across Pennsylvania through October and November, including Reading on October 31, 2016.

PUC Vice Chairman Andrew Place is the opening speaker at the Wilkes-Barre event, which will focus on the importance of increasing awareness throughout Northeastern PA about the many assistance programs intended to help lower-income residents afford and maintain utility services.

“It is essential that we work to connect all the different programs in a community to more effectively serve as many people as possible,” said Vice Chairman Andrew Place. “We need to stay connected to each other to best serve those residents. Our driving focus is to keep these families connected to essential utility services.”

According to data compiled by the PUC, Pennsylvania utilities spent nearly $459 million on various customer assistance programs last year, not counting private assistance or the federal Low Income Heating Assistance Program (LIHEAP). Every year, these programs helped reduce the monthly bills for more than 280,000 electric customers and over 160,000 natural gas customers across the state – and enrollment and annual spending for these programs has increased dramatically over the past decade.

Additionally, PUC-required assistance services also support programs to help low-income customers modernize their heating systems and reduce their energy consumption – making current and future utility bills more affordable. Utilities, and their customers, also contribute several million dollars per year in hardship funds, assisting thousands of in-need families.

In addition to networking opportunities, the free “train-the-trainer” event will feature presentations from state agencies, local utility companies and other financial assistance programs in order to share ideas and services.

This year’s participants include the PUC, United Way of Greater Hazleton, PPL Electric Utilities Inc., UGI Utilities Inc., Dollar Energy Fund, North Penn Legal, Commission on Economic Opportunity, Weinberg Regional Food Bank, the state’s Office of Consumer Advocate, and the Luzerne County Assistance Office.

The remaining PUC’s Be Utility Wise events include:

Wilkes-Barre/Scranton – Oct. 20, 2016, from 8 a.m. to 3:30 p.m.

Mohegan Sun

1280 Highway 315

Wilkes-Barre, PA 18702

Johnstown – Oct. 28, 2016, from 8:30 a.m. to 3:30 p.m.

University of Pittsburgh at Johnstown

450 Schoolhouse Rd.

Johnstown, PA 15904

Berks County – Oct. 31, 2016, from 8:30 a.m. to 4:30 p.m.

Double Tree by Hilton

701 Penn Street

Reading, PA  19601

Harrisburg – Nov. 15, 2016, from 8:30 a.m. to 3 p.m.

Red Lion Inn

4751 Lindle Rd.

Harrisburg PA 17111

To learn how Prince Law Offices, P.C. can assist you or your business with PUC matters, contact attorney Jeffrey A. Franklin at Prince Law Offices, P.C.

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PUC Seeks Comments on Changes to Utility Regulations

puc_sealThe Pennsylvania Public Utility Commission (PUC or Commission) today issued for comment revisions to Chapter 56 of the Public Utility Code (Chapter 56), including but not limited to new utility reporting requirements, a new definition for medical certificates, an end to Friday utility service terminations, and installments for customers’ security deposits.

The Commission voted 4-0 to adopt the revisions to Chapter 56, which relates to the standards and billing practices for residential utility service.  Act 155 of 2014, which reauthorized and amended Chapter 14 of the Public Utility Code (Chapter 14) and partially superseded Chapter 56, directed the Commission to revise Chapter 56 and promulgate regulations to administer and enforce Chapter 14 (Responsible Utility Customer Protection).

In making Chapter 56 consistent with the amended Chapter 14, the Commission has revised and updated several key areas. Relating to the definition of a “Medical Certificate,” the Commission is proposing new content standards for medical certificates, which under Act 155 must be in writing and in a form approved by the Commission.  Prior to Act 155, the Public Utility Code contained no definition for medical certificates.  Act 155 also added physician assistants to the list of health professionals who can authorize medical certificates, a change also sought in the proposed rulemaking.

Additionally, the Commission seeks further comment on several other proposed changes to Chapter 56, including but not limited to a requirement for utilities to report annually medical certificate usage, as well as customer accounts with arrearages in excess of $10,000; the end of termination of utility service on Fridays; and allowing customers to pay security deposits in three installments over a 60-day period.  The proposed rulemaking also would make small natural gas distribution companies, as well as steam heat and wastewater utilities, comply with the same rules as electric and natural gas utilities.

Act 155 was signed into law on Oct. 22, 2014, by Governor Tom Corbett. It amends Chapters 5, 14, 22 and 28 of the Public Utility Code. In addition to establishing a definition for medical certificate, Act 155 allows the PUC to: 1) establish annual fees to fund the Commission’s oversight of natural gas suppliers and electric generation suppliers; 2) include the intrastate operating revenues of licensed entities in determining its budget cap; and 3) exclude from its budget cap funds received from the federal government and other sources to perform functions unrelated to the Commission’s jurisdictional regulation.

To learn how Prince Law Offices, P.C. can assist you with PUC matters including comments to the proposed regulations, contact attorney Jeffrey A. Franklin at Prince Law Offices, P.C.

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PUC Reminds Consumers Help Is Available

puc_sealAs part of its ongoing “Prepare Now” campaign, the Pennsylvania Public Utility Commission (PUC) released its annual report on Universal Service Programs, along with responses from electric and natural gas utility companies to the PUC’s call for enhanced efforts to help consumers cope with winter heating costs.

“Access to power, heat, water and telecommunications is an essential part of protecting the health and welfare of our citizens, but every year thousands of Pennsylvanians struggle to afford these vital services,” said PUC Chairman Gladys M. Brown. “The information released today underscores the continuing need in our communities and also highlights the collaborative efforts being made to assist consumers across our state.”

“Universal Service” is the principle that everyone should have access to essential utility services. Universal Service is promoted through a set of state-mandated policies, protections and programs intended to provide a safety net for eligible low-income utility customers, including:

  • Customer Assistance Program (CAP), which provides subsidized utility service to eligible households based on household size and income;
  • The Low Income Usage Reduction Program (LIURP), which includes free weatherization and other conservation measures, installation of energy efficient appliances, energy audits and education about conservation;
  • The Customer Assistance and Referral Evaluation Services (CARES) program, which provides information about available programs and/or referrals to community agencies to help consumers address family emergencies, health issues or other extenuating circumstances; and
  • Hardship Funds, programs supported by utility contributions and public donations that which can assist individuals in paying outstanding debts to utility companies.

Additionally, the PUC, utilities, and human service agencies across the state strongly promote the federally funded Low Income Home Energy Assistance Program (LIHEAP), which provides assistance with home heating bills during the winter months. The application period for LIHEAP crisis and regular grants has opened and continues through April 1, 2016.

According to the PUC’s Universal Service Report, there are more than 1 million confirmed low-income electric and natural gas customers (household income at or below 150 percent of the federal poverty income guideline) being served by utilities under the PUC’s jurisdiction. While unconfirmed, utilities estimate that nearly 2 million customers may actually fit that classification – potentially including about 27 percent of all utility households in Pennsylvania.

The report also documents nearly $460 million in annual utility assistance provided to households across the state and demonstrates that consumers who participate in these safety net programs are more likely to continue paying their bills and maintain their utility service. In fact, the most recent PUC data shows that 83 percent of the households participating in Customer Assistance Programs were able to preserve their heat and other vital services.

“This data demonstrates the size and scope of in-need utility customers across the state, just how close many families may be to a utility crisis and the important role of various safety-net programs,” said Chairman Brown.

Further underscoring the existing need in Pennsylvania communities, the PUC’s annual Cold Weather Survey, released in December 2015, documented more than 24,000 households entering the winter without heat-related utility service. Every year the state’s electric and natural gas distribution companies under the PUC’s jurisdiction are required to survey residential properties where service has been terminated and has not been reconnected during the calendar year.

As part of the PUC’s annual “Prepare Now” campaign, the Commissioners sent an October 2015 letter to all Pennsylvania electric and natural gas utility companies under the PUC’s jurisdiction, asking them to join the Commission in reaching out to consumers about winter assistance programs and emphasizing that utilities have more flexibility to make allowances for payment-troubled customers than the PUC does under the law. The responses from each utility, along with summaries of all their ongoing outreach efforts, are detailed here.

Consumers experiencing difficulty maintaining utility service are encouraged to reach out as early as possible to their utility companies; local human service and non-profit organizations; and state agencies such as the Department of Human Services and PUC for information about the many programs available to help maintain essential utility services.

If you or your business have questions regarding utility law, natural gas law, energy law, or real estate law, contact attorney Jeffrey A. Franklin at Prince Law Offices, P.C.

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