SCEG OATT Formula Transmission Rate Filing.pdf - SCANA ...

20091231-0037 FERC PDF (Unofficia1) 12/29/2009
Direct Testimony of Alan C. Heintz
Docket ER 1O·~·OOO
Page 25 of28
Exhibit No. SeE·8
and ensures there is no over-recovery with respect to charges assessed as the result of the
2
application of the formula. The classification, functionalization and allocation factors
3
used for the cost items reflect standard Commission ratemaking.
Furthermore, all data
4
5
used in Appendix A is taken directly out of the FERC Form I or reconciled back to the
FERC Form I in the Attachments to Appendix A.
6 Q.
7
8
PLEASE DISCUSS SCE&G'S PROPOSAL TO BEGIN CHARGING FOR NITS
THROUGH A STATED RATE, REPLACING THE CURRENT LOAD RATIO
SHARE METHODOLOGY.
9 A.
SCE&G's proposal to use a stated rate based on a 12 CP divisor is consistent with what
10
the Commission has approved for other utilities.
SCE&G's proposal to institute a stated
II
12
NITS rate reflects its desire to provide a degree of rate certainty to purchasers of its
network transmission services who currently face constantly changing rates because the
13
current NITS rates are calculated using the load ratio methodology.
In other words,
14
SCE&G's proposal is consistent with and superior to the pro-forma OATT rate design
15
because it is simpler and more predictable for all transmission users.
The Commission
16
17
recognized the validity of this concern, when it approved Pennsylvania-New
Maryland Interconnection, Inc.'s proposal of a stated rate for network service:
Jersey-
18
19
20
21
22
23
24
The stated rate for network service is intended to provide greater rate
certainty to suppliers and customers than exists under the load ratio share
approach, because the ultimate transmission rate for a supplier under the
load ratio share method will change depending not only on variations in
the loads served by a particular supplier but on the loads served by others.
Pennsylvania-New Jersey-Maryland Interconnection, LLC, 81 FERC ~ 61,257, at n. 44
(1997). See also PJM Interconnection, LLe., et aI., 108 FERC ~ 61,318 (2004);