System Improvement Charges Act 11 of 2012
On Feb. 14, 2012, Governor Corbett signed Act 11 of 2012 amending Title 66 (Public Utilities) of the Pennsylvania Consolidated Statutes to allow jurisdictional water and wastewater utilities, natural gas distribution companies, city natural gas distribution operations, and electric distribution companies to petition the Commission for approval to implement a Distribution System Improvement Charge (DSIC).
The DSIC must be designed to provide for "the timely recovery of the reasonable and prudent costs incurred to repair, improve or replace eligible property in order to ensure and maintain adequate, efficient, safe, reliable and reasonable services." 66 Pa.C.S. § 1353 (a).
Starting on Jan. 1, 2013, public utilities may petition the Commission for approval to establish a DSIC. The petition must contain the following elements: 1) initial tariff; 2) testimony and exhibits to demonstrate that the DSIC will ensure the provision of adequate, efficient, safe, reliable and reasonable service; 3) long-term infrastructure plan; 4) certification that a base rate case has been filed within the past 5 years; and 5) any other information required by the Commission. Moreover, the petition must demonstrate that granting the petition and allowing the DSIC to be charged will accelerate the replacement of infrastructure.
The Commission has established Docket No. M-2012-2293611 as a generic docket number for all Implementation Orders, Secretarial Letters and working group meetings relating to the implementation of Act 11 of 2012.
A working group meeting is planned for Thursday, April 5, 2012 from 10 AM to 12:30 PM in Hearing Room 1 of the Commonwealth Keystone Building. To participate in the working group meeting please send an email to ra-Act11@pa.govby March 30, 2012. Also, to be placed on an electronic distribution list to receive updates in the future, please send an email to ra-Act11@pa.gov.
Secretarial Letter - The PUC issued a Secretarial Letter (dated August 31, 2012) establishing a working group involving interested industry stakeholders to examine the appropriate barometer groups, cost of equity models, range of reasonableness, and other factors necessary to develop a cost of equity for each industry to be used in the staff’s Quarterly Financial Report and the DSIC if more than two years have elapsed since the last base rate case.
Secretarial Letter - The PUC issued a Secretarial Letter (dated March 22, 2012) announcing the Act 11 working group meeting to be held on Thursday, April 5, 2012 from 10 AM to 12:30 PM in Hearing Room 1 of the Commonwealth Keystone Building.
Working Group Meetings
September 13, 2012 - Agenda
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