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

20091231-0037 FERC PDF (Unofficia1) 12/29/2009
SCE&G's OATT Formula Transmission
Docket No. ERIO-
Rate Filing
PageS
these inputs are ROE, Post-retirement Benefits other than Pensions (PBOPs), and depreciation
rates. 9 The annual transmission revenue requirement determined by the formula, divided by the
12 coincident peak (12 CP) load, will yield the annual charge per MW, which will then be
converted into a monthly charge. The monthly bill for each NITS customer will be calculated by
multiplying that monthly charge per MW times the customer's actual use. For PTP service,
charges for yearly, monthly, weekly, daily and hourly service also will be developed based on
the results of the formula. The yearly rate for firm PTP service will be the same as the yearly
NITS rate, with rates for other services derived based on the yearly rate. Rates for PTP
customers taking short term service will include on-peak and off-peak pricing consistent with
C
.. I 10
omm1SSIOncase aw.
Formula Rate implementation protocols, included in the OATT, describe how SCE&G
will update the formula in future years, what the review procedures are, how customer challenges
will be resolved, and how any changes to the annual rate restatements will be implemented. The
review procedures prescribe certain periods for (I) customer review of, (2) service of data
requests and SCE&G responses thereto in connection with, and (3) preliminary and formal
challenges to, the annually published Formula Rates. The protocols also prescribe certain
periods for filing a complaint with the Commission, and SCE&G's response thereto, in the event
formal challenges cannot be resolved by the parties. These procedures do not limit in any way
SCE&G's right to file to change the formula or its inputs under section 205 of the Federal Power
Act, or the right of any other party to file a complaint requesting such changes under section 206.
Return on Equity
Dr. Vilbert determines the applicable cost of equity using the sustainable growth
discounted cash flow (OCF) methodology favored by the Commission. II This methodology
determines the ROE by summing the expected growth rate and the dividend yield (with an
adjustment for the quarterly payment of dividends) and applying that methodology to a proxy
group consisting of companies facing risks similar to SCE&G. Following Commission
precedent,12 Dr. Vilbert selected a proxy group consisting of companies in the region where
9
See, e.g., Trans-Allegheny
denied, 121 FERC 'If 61,009 (2007).
Interstate Line Co., 119 FERC 'If 61,219, at P 54 (2007), reh'g
10
See, e.g., American Electric Power Service Corp., 39 FERC 'If 61,296 (1987).
11
E.g., Southern California Edison Co., Opinion No. 445, 92 FERC 'If 61,070 (2000), reh'g
denied, 108 FERC 'If 61,085 (2004); Consumers Energy Co., Opinion No. 456,98 FERC 'If 62,333 (2002).
12
Transmission,
P 25 (2008).
See, e.g., Westar Energy, Inc., 122 FERC 'If 61,268, at P 93 (2008); Tallgrass
LLC, 125 FERC 'If 61,248, at PP 74-75 (2008); Startrans 10, L.L.c., 122 FERC 'If 61,306, at