The Connecticut Department of Public Utility Control (DPUC) recently approved United Illuminating’s 2010 generation service rates for its Standard Service and Last Resort service customers. The decision comes out of Docket No. 10-01-02, Administrative Proceeding to Review The United Illuminating Company’s Rates and Charges Effective January 1, 2010.
UI indicated that its transmission rate will not be known until later this month at which time they will submit additional information. As a result, UI has not yet provided the exact impact of all rate changes to customer bills at this time. Only Standard Service and Last Resort Service generation rates are addressed at this time.
Standard Service Generation Rates
Standard Service generation is procured using a laddering approach in which UI purchases generation in small increments at different time periods in order to achieve a blended generation rate.
In the past, the Department has adjusted Standard Service generation rates on January 1st and July 1st, establishing rates for each six month period. However, in Docket No. 08 11 12, because UI had procured its entire load for 2009, the Department approved twelve-month Standard Service generation rates effective in 2009.
This table compares UI’s Standard Service GSC rates effective Jan-Dec 2009 to the proposed rates for Jan-Dec 2010:
Impact
The overall Standard Service generation rate will decline from its current average of 12.3151¢/kWh to 11.5288¢/kWh, a reduction of .7863¢/kWh (about 6.4%). However, the impact of the decrease to this rate component will vary by rate class. For example…
- Residential Rate R will decrease from the present average of 12.4228¢/kWh to 11.5680¢/kWh, a decrease of .8548¢/kWh (about 6.9%).
- Rate GS rates will decrease from the present average of 12.2419¢/kWh to 11.5918¢/kWh, a decrease of .6501¢/kWh (about 5.3%).
UI’s residential and business time of day generation rates retain a peak/off peak differential of 3.5¢/kWh and 3¢/kWh, respectively.
Additional Standard Service Changes
- UI proposed to include recovery of generation related costs currently recovered through the distribution component of rates through generation rates. Standard Service generation rates will include 0.0792¢/kWh, to recover these costs. This allocation is included for all Standard Service and Last Resort Service generation rates.
- UI’s 2010 wholesale procurement for Standard Service generation contain “Type B” bids which require UI to assume the risk for costs related to Locational Price Differentials. UI proposed to include recovery of 0.0353¢/kWh in all Standard Service generation rates to reflect this cost. This amount will be trued-up to actual costs in a future proceeding.
Last Resort Service Generation Rates
Unlike Standard Service generation supply, the contracts for UI’s Last Resort Service generation are not laddered and therefore more closely reflect current market conditions. UI’s proposed LRS rates for Jan-Mar 2010 are:
Impact
Based on UI’s proposal, the Q1 2010 average LRS rate will increase from the current Q4 2009 average of 8.0063¢/kWh to 9.7535¢/kWh, an increase of 1.7472¢/kWh (or about 21.8%).
UI is required to submit final tariffs on or before December 30, 2009. The DPUC said it will issue a subsequent letter later this month to address changes to the delivery components of the rates. Overall impact on customer bills are expected to be explained at that time.
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