Judge issues recommendations in APS rate case
The Business
Journal
March 1, 2005
An administrative law judge has added another layer to the framework of a settlement of a rate increase request by electricity provider Arizona Public Service Co. (APS), according to an announcement released Tuesday by the Arizona Corporation Commission.
The judge's recommendations,
delivered late Monday, follow a settlement agreement reached in August
2004 between ACC, APS and several other groups.
APS originally requested
a rate increase in June 2003, equalling $167 million in additional base
rate revenue plus a surcharge of $8.3 million to recoup deferred costs,
for an overall 9.8 percent increase.
Following five months
of negotiations, the August settlement reduced the rate increase to $68
million and the surcharge to $7.9 million, for an overall rate increase
of 4.2 percent.
Following testimony
in late November, the administrative law judge took the case to review,
and issued what the ACC called an "approval of the case with a few
modifications."
Among the modifcation,
the judge recommended a cap on "annual gas costs' that APS could
pass on through a power supply adjustor mechanism that would allow the
utility to collect on power supply costs that are above the test year,
in this case, 2002. The same mechanism, which has a five-year limit, calls
for customer refunds if fuel charges are below the test year level.
The judge also called
for demand response programs and the use of "smart meters."
We just received the order and we are evaluating it," said APS spokesman
Jim McDonald. "We are allowed to make written comments on in on March
14 and we will do so."
The next step will
be for the ACC commissioners to meet in an open meeting to discuss and
vote on the judge's recommendations. The Commission can accept, deny or
amend them.
APS is the electricity providing subsidiary of Phoenix-based Pinnacle
West Capital Corp. (NYSE: PNW).
For more: www.cc.state.az.us,
www.aps.com.
For a copy of the judge's recommended modifications, www.cc.state.az.us/utility/electric/arc-index.htm.
