CPUC decided to maintain the $0.20147 per kwh enforced since April 2, 2009, saying the “record supports a finding that the proposed LEAC rate is just and reasonable.”
The LEAC replaced the fluctuating monthly electric rate set every month according to the oil price.
In its seven-page decision on Sept. 3, CPUC Chairwoman Viola Alepuyo and Commissioner Kyle Calabrese stated that the LEAC should focus on “key variables” — sales, fuel use, fuel pricing, regulatory costs, and capital for efficiency improvements.
CPUC set the cost of fuel and lube oil during the upcoming LEAC cycle at $0.21278.
CPUC at the same time directed the Commonwealth Utilities Corp. to utilize $2.9 million from its generation element reserves from Jan. 1 2009 to Sept. 30, 2009 to cover the differences between the estimated costs of fuel during the LEAC cycle.
CPUC said there’s a need to bridge the shortfall between the $0.21278 estimate and the recommended fuel element of $0.18807.
“No further funding should be authorized for the inventory and generation elements until further commission order,” CPUC said.
CPUC wants the generation and inventory element revenues reconciled to establish the next LEAC factor in March 2010, “with any credit balances for these elements being reimbursed to the ratepayers.”
CPUC said the LEAC rate was reduced to over 4 cents per kwh after Georgetown was able to reconcile the LEAC cycle of January to March 31, 2009, which resulted in crediting $1.9 million to ratepayers in addition to the $2.9 million accrued from the generation element.
“These adjustments in favor of the ratepayers demonstrate the substantial benefit of a transparent, independent review of CUC’s fuel expenses under the LEAC tariff,” CPUC said.
