Florida Administrative Code › 25 - PUBLIC SERVICE COMMISSION › 25 - Departmental › Chapter 25-7 - GAS SERVICE BY GAS PUBLIC UTILITIES › Part X › Subpart B - Revenue Requirements › Section 25-7.0143 - Use of Accumulated Provision Accounts 228.1, 228.2, and 228.4

Current through Reg. 50, No. 138; July 16, 2024
(1) Account No. 228.1 Accumulated Provision
					 for Property Insurance.
(a) This account may
					 be established to provide for losses through accident, fire, flood, storms and
					 similar type hazards to the utility's own property or property leased from
					 others, which is not covered by insurance. A schedule of risks covered must be
					 maintained, giving a description of the property involved, the character of
					 risks covered and the accrual rates used.
(b) Except as provided in paragraphs (1)(f),
					 (1)(g) and (1)(h) charges to this account must be made for all occurrences in
					 accordance with the schedule of risks to be covered which are not covered by
					 insurance. Recoveries, insurance proceeds or reimbursements for losses charged
					 to this account must be credited to the account.
(c) A separate subaccount must be established
					 for that portion of Account No. 228.1 which is designated to cover
					 storm-related damages to the utility's own property or property leased from
					 others that is not covered by insurance. The records supporting the entries to
					 this account must be so kept that the utility can furnish full information as
					 to each storm event included in this account.
(d) In determining the costs to be charged to
					 cover storm-related damages, the utility must use an Incremental Cost and
					 Capitalization Approach methodology (ICCA). Under the ICCA methodology, the
					 costs charged to cover storm-related damages must exclude those costs that
					 normally would be charged to non-cost recovery clause operating expenses in the
					 absence of a storm. Under the ICCA methodology for determining the allowable
					 costs to be charged to cover storm-related damages, the utility will be allowed
					 to charge to Account No. 228.1 costs that are incremental to costs normally
					 charged to non-cost recovery clause operating expenses in the absence of a
					 storm. All costs charged to Account 228.1 are subject to review for prudence
					 and reasonableness by the Commission. In addition, capital expenditures for the
					 removal, retirement and replacement of damaged facilities charged to cover
					 storm-related damages must exclude the normal cost for the removal, retirement
					 and replacement of those facilities in the absence of a storm. The utility must
					 notify the Commission Clerk in writing for each incident expected to exceed 1.5
					 percent of jurisdictional revenues for the most recent calendar year.
(e) The types of storm related costs allowed
					 to be charged to the reserve under the ICCA methodology include the following:
1. Additional contract labor hired for storm
					 restoration activities incurred in any month in which storm damage restoration
					 activities are conducted, that are greater than the actual monthly average of
					 contract labor costs charged to operation and maintenance expense for the same
					 month in the three previous calendar years. The utility may adjust historical
					 monthly contract labor costs charged to operation and maintenance expense from
					 calculated monthly average. Each adjustment must be accompanied by a detailed
					 explanation of the nature and derivation of the adjustment;
2. Logistics costs of providing meals,
					 lodging, and linens for tents and other staging areas;
3. Transportation of crews and other
					 personnel for storm restoration;
4.
					 Vehicle costs for vehicles specifically rented for storm restoration
					 activities;
5. Waste management
					 costs specifically related to storm restoration activities;
6. Rental equipment specifically related to
					 storm restoration activities;
7.
					 Materials and supplies used to repair and restore service and facilities to
					 pre-storm condition, excluding those costs that normally would be charged to
					 non-cost recovery clause operating expenses in the absence of a
					 storm;
8. Payroll and
					 payroll-related costs for utility personnel included in storm restoration
					 activities incurred in any month in which storm damage restoration activities
					 are conducted, that are greater than the actual monthly average of payroll and
					 payroll-related costs charged to operation and maintenance expense for the same
					 month in the three previous calendar years. The utility may adjust historical
					 monthly payroll and payroll-related costs charged to operation and maintenance
					 expense from calculated monthly average. Each adjustment must be accompanied by
					 a detailed explanation of the nature and derivation of the
					 adjustment;
9. Fuel cost for
					 company and contractor vehicles used in storm restoration activities incurred
					 in any month in which storm damage restoration activities are conducted, that
					 are greater than the actual monthly average of fuel costs charged to operation
					 and maintenance expense for the same month in the three previous calendar
					 years. The utility may adjust historical monthly fuel costs charged to
					 operation and maintenance expense from calculated monthly average. Each
					 adjustment must be accompanied by a detailed explanation of the nature and
					 derivation of the adjustment;
10.
					 Cost of public service announcements regarding key storm-related issues, such
					 as safety and service restoration estimates;
11. Vegetation management expenses
					 specifically related to storm restoration activities incurred in any month in
					 which storm damage restoration activities are conducted, that are greater than
					 the actual monthly average of vegetation management costs charged to operation
					 and maintenance expense for the same month in the previous three calendar
					 years. The utility may adjust historical monthly vegetation management costs
					 charged to operation and maintenance expense from calculated monthly average.
					 Each adjustment must be accompanied by a detailed explanation of the nature and
					 derivation of the adjustment; and
12. Other costs or expenses not specifically
					 identified in subparagraphs (1)(e)1. through (1)(e)11. that are directly and
					 solely attributable to a storm restoration event.
(f) The types of storm related costs
					 prohibited from being charged to the reserve under the ICCA methodology include
					 the following:
1. Bonuses or any other special
					 compensation for utility personnel not eligible for overtime pay;
2. Depreciation expenses, insurance costs and
					 lease expenses for utility-owned or utility-leased vehicles and
					 aircraft;
3. Utility employee
					 assistance costs;
4. Utility
					 employee training costs incurred prior to 72 hours before the storm
					 event;
5. Utility advertising,
					 media relations or public relations costs, except for public service
					 announcements regarding key storm-related issues as listed above in
					 subparagraph (1)(e)10.;
6. Utility
					 call center and customer service costs, except for non-budgeted overtime or
					 other non-budgeted incremental costs associated with the storm event;
7. Utility lost revenues from services not
					 provided; and
8. Replenishment of
					 the utility's materials and supplies inventories.
(g) Under the ICCA methodology for
					 determining the allowable costs to be charged to cover storm-related damages,
					 certain costs may be charged to Account 228.1 only after review and approval by
					 the Commission. Prior to the Commission's determination of the appropriateness
					 of including such costs in Account No. 228.1, the costs may be deferred in
					 Account No. 186, Miscellaneous Deferred Debits. The deferred costs must be
					 incurred prior to June 1 of the year following the storm event. By September 30
					 a utility must file a petition for the disposition of any costs deferred prior
					 to June 1 of the year following the storm event giving rise to the deferred
					 costs. These costs include the following:
1.
					 Costs of normal non-storm related activities which must be performed by
					 employees or contractors not assigned to storm damage restoration activities
					 ("back-fill work") or normal non-storm related activities which must be
					 performed following the restoration of service after a storm by an employee or
					 contractor assigned to storm damage restoration activities in addition to the
					 employee's or contractor's regular activities ("catch-up work"); and
2. Uncollectible accounts
					 expenses.
(h) A utility
					 may, at its own option, charge storm-related costs as operating expenses rather
					 than charging them to Account No. 228.1. The utility must notify the Commission
					 Clerk in writing and provide a schedule of the amounts charged to operating
					 expenses for each incident exceeding 0.5 percent of jurisdictional revenues for
					 the most recent calendar year. The schedule must be filed annually by February
					 15 of each year for information pertaining to the previous calendar
					 year.
(i) If the charges to Account
					 No. 228.1 exceed the account balance, the excess must be carried as a debit
					 balance in Account No. 182.3 and no request for a deferral of the excess or for
					 the establishment of a regulatory asset is necessary.
(j) A utility may petition the Commission for
					 the recovery of a debit balance in Account No. 182.3 discussed in paragraph
					 (1)(i) plus an amount to replenish the storm reserve through a surcharge,
					 securitization or other cost recovery mechanism.
(k) A utility must not establish or change an
					 annual accrual amount or a target accumulated balance amount for Account No.
					 228.1 without prior Commission approval.
(l) Each utility must file a Storm Damage
					 Self-Insurance Reserve Study (Study) with the Commission Clerk by January 15,
					 2022 and at least once every 5 years thereafter from the submission date of the
					 previously filed study. A Study must be filed whenever the utility is seeking a
					 change to either the target accumulated balance or the annual accrual amount
					 for Account No. 228.1. At a minimum, the Study must include data for
					 determining a target balance for, and the annual accrual amount to, Account No.
					 228.1.