2012 PSC Annual Report - Missouri Public Service Commission

REGULATORY ACTIVITYfiling, the Commission brought to FERC’s attention two gasloss incidents which, per Commission precedent, shouldnot be included in the calculation of the LUFG percentage.FERC agreed with the Commission and required CEGT toremove the two losses in question and recalculate the fuelloss reimbursement percentage to be charged to Missouriconsumers.The Commission will continue to analyze the pipelinecompanies fuel recovery cases to determine whether therates to be charged Missouri consumers are just andreasonable.Atmos Energy Corporation/Liberty Energy Midstates Corp.Atmos Energy sold its Missouri assets to Liberty EnergyMidstates. Atmos filed at FERC to transfer its Missourinatural gas transmission and distribution facilities to LibertyEnergy. The Commission’s concern regarded facilitieslocated in western Missouri which contained a 35-foot stubline that crosses the Kansas/Missouri border. After thesale, this stub line will be controlled by Atmos’ Colorado/Kansas division, not Liberty Midstates.The Commission intervened at FERC over concerns asto whether Missouri customers would continue to receivethe same level of service after the sale to Liberty Energywas final. The Kansas Corporation Commission (KCC) alsofiled comments in the case. The Commission was able tonegotiate with Atmos and Liberty Energy to assure reliableservice to Missouri customers.MoGas Pipeline LLCAt the end of June 2006, FERC regulated MissouriInterstate Gas LLC (MIG), and Missouri-regulated MissouriPipeline Company LLC (MPC) and Missouri Gas CompanyLLC (MGC) applied to FERC for authority to merge into asingle FERC-regulated interstate pipeline. On April 20,2007, FERC issued an order authorizing the three affiliatedpipelines to merge as MoGas Pipeline (MoGas). The FERCorder also reduced MoGas proposed rates by approximately$2 million as a result of the Commission’s (and otherparties) challenge to the rates.In the same proceedings, the Commission challengedFERC’s order that permitted MoGas to include an acquisitionpremium in rates that resulted in an annual overcharge toMissouri customers of approximately $1.3 million annually.FERC denied the Commission’s challenge. The Commissionappealed FERC’s decision to the United States Court ofAppeals for the D.C. Circuit Docket No. 9-2 andon April 13, 2010, the DC Circuit Court agreed with theCommission’s arguments and vacated the FERC’s order andremanded the case to FERC.On August 1, 2011 the FERC held a hearing to addressthe acquisition premium issue. The initial decision by theAdministrative Law Judge in this case, issued in November2011, supported the Commission’s position. The finalFERC order in this case is still pending.CenterPoint Energy-Mississippi River TransmissionIn October 2011, Mississippi River Transmission (MRT)provided notice to the public that it intended to meet withcustomers and state commissions prior to filing a FERC casefor a rate increase. The Commission participated in prefilingsettlement discussions with CenterPoint Energy-MississippiRiver Transmission (MRT) during the summer of 2012.During June and July, customers, the Commission and otherinterested parties negotiated with MRT. These negotiationsfailed to reach a settlement among the parties. On August15, 2012, MRT filed a Section 4 rate case with FERC asking fora rate increase of approximately 80% to recover nearly $104million from customers through rates annually. MRT servesthe St. Louis area natural gas market. Both the Arkansas PublicService Commission and the Illinois Commerce Commissionhave intervened in the Section 4 rate case.WATER AND SEWERUNITRate Cases Decided or FiledMissouri-American Water CompanyCase No. WR-2-33On June 30, 2011, Missouri-American Water Company(MAWC) filed a water and sewer rate case with the PublicService Commission (Commission) seeking to increaseannual water and sewer revenues by approximately $43million. The Commission granted MAWC an overall rateincrease of approximately $24 million in an order issued onMarch 7, 2012, based upon a non-unanimous stipulationand agreement filed by the parties to the proceeding.Although the agreement was non-unanimous, no partyopposed the agreement that settled all issues in the case.The increase to water revenues approved was $23,275,000and the increase to sewer revenues approved was $725,000on an annual basis. Rates went into effect on April 1, 2012.For MAWC customers in the former Aqua Missouri serviceareas, rates went into effect on June 1, 2012.Water and Sewer Unit StaffThe Water and Sewer Unit (Unit) provides technical expertisein the operation of the water and sewer companies in Missouriand analyzes applicable tariffs and tariff filings to ensure theyare in compliance with appropriate state law, Commissionrule, and are fair for both the utility and consumer.The main functions of the Unit are to assist small companiesin their day-to-day operations, conduct inspections, assistcustomers, investigate customer complaints, work on tarifffilings, review small and large company rate requests, andreview applications for certificates of public convenienceand necessity to ensure that a proposed utility is in thepublic interest.The Unit plays a key role in developing appropriate ratesrequired for the utility to collect the revenues that havebeen approved by the Commission.Another major role fulfilled by the Unit is investigatingcustomer complaints regarding quality of service issues.Unit personnel spend many hours in the field investigatingcomplaints and working with the customer and the companyto find solutions to the customer’s concerns.There are approximately 75 regulated water and/orsewer companies in the State of Missouri. 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