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Posted by Calhouner
Here is your reminder to come to the PSC hearing Thursday evening.
The WV Public Service Commission will be holding a public hearing on the December 2009 blackout that struck southern and central West Virginia. The PSC is in the middle of studying the causes of the blackout.
The hearing will be held on Thursday, March 11 at 6:00 p.m. at he Harrison County Recreation Complex/4-H Center located on 23 Recreation Drive in Clarksburg. If you are an intervenor in the PATH case at the PSC, you will be allowed to testify at this hearing, because it is a different case.
A Morgantown friend has been looking at the WV Consumer Advocate's responses to Allegheny Energy's recent rate increase request at the PSC. It turns out that Allegheny's WV division has vastly underspent on vegetation control in the last three years. You might want to include some of this evidence in your testimony Thursday night.
Here is a direct quote from the CAD's response to Allegheny's most recent rate increase request available at http://www.psc.state.wv.us/scr...
The vegetation control expense for calendar years 2006, 2007 and 2008 have been $18.0 million, $15.0 million and $20.1 million, respectively. The annual vegetation control expense has been less than the $23.9 million that the Companies are seeking, and, except for 2008, the annual expense has been even less than the 2005 test year amounts. This hardly suggests an "increased pace" as anticipated by the Commission.
In an earlier rate case, the PSC had stated:
the Commission encourages an increased pace of right-of-way maintenance and, therefore, will carve out this proposed adjustment for special treatment in this case and in future cases. The Companies should clearly understand that the $4.3 million allowance is for additional regular maintenance necessitated by moving to a more aggressive four-year maintenance cycle, as compared to the approximately $19.6 million spent per year for normal right-of way vegetation control.
In other words, since the last rate increase Allegheny got, Allegheny has seriously under-spent on vegetation control. They collected the higher rates, but they didn't spend the money they saved on clearing rights-of-way. And my power was out for six days last December as a result.
Here is what the Consumer Advocate Division concluded about Allegheny's right-of-way maintenance:
Without prejudging the outcome of the Commission's General Investigation into the recent storm-related outages, it certainly is reasonable to suspect that the Companies' failure to accelerate their vegetation control program as envisioned by the Commission's Order in Case No. 06-0960-E-42T may have had a significant impact on the extent, severity, and duration of the outages experienced by the Companies' customers as a result of the December snow storm.
Gosh, do ya think?
Remember what Allegheny's CEO Evanson told investors in his last conference call:
And we'll be vigilant in our efforts to control costs and spending. Our plan is to keep [inaudible] O&M [Operations & Maintenance] flat marking the fifth consecutive year of no increase in costs, an accomplishment I think few can match.
During that same time period when Mr. Evanson managed this "accomplishment few can match," WV rate payers were paying for right-of-way maintenance they weren't getting. Also during that same time period, Mr. Evanson was the eighth highest paid CEO in the US. Now we know where our money went.
Also in their most recent rate increase request, Allegheny wants the WV PSC to stop monitoring the effectiveness of their right-of-way maintenance because that is an "administrative burden."
Here is what the CAD said about that:
Q. SHOULD THE COMMISSION ABOLISH THE MONITORING OF VEGETATION CONTROL EXPENSES AS REQUESTED BY THE COMPANIES?
A. No. Such a removal of oversight would be unwise in light of the Companies' failure to meet the spending targets they themselves proposed in the last rate case and which were approved by the Commission. Those amounts were included in the Companies' cost of service and reflected in rates charged to customers. Given the likelihood that the failure to spend the specified amounts on right-of-way maintenance exacerbated the impact of the December 2009 snow storm, it would seem inappropriate to reward the Company with continued higher levels of expense for this issue without ensuring that the amounts included in cost of service are indeed expended for their intended purpose. [emphasis added]
I tend to agree.
I have a question of my own for our PSC Commissioners -- Shouldn't you be more concerned about fixing the reliability of West Virginia's own distribution power grid, before you go approving monster transmission lines to New Jersey using our electric rate money?
See you in Clarksburg tomorrow night.
-- cross posted from The Power Line, The View from Calhoun County http://calhounpowerline.wordpr...
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