North Carolina Administrative Code › Title 04 - COMMERCE › Chapter 11 - UTILITIES COMMISSION › Chapter 6 › Article 6 - INSPECTIONS AND TESTS › Section 11 R06-89 - DEFERRAL ACCOUNTING FOR NATURAL GAS EXPANSION

Current through Register Vol. 39, No. 2, July 15, 2024
(a) An LDC
				  may request Commission approval to create a regulatory asset account for the
				  purpose of accruing a return on its investment in transmission lines
				  constructed as part of a Project of the type that would be eligible for use of
				  an expansion fund pursuant to
				  G.S.
				  62-158. Such a request may be filed with the
				  Commission as part of a request for approval of a Project pursuant to Rule
				  R6-84 but in no event less than 45 days prior to the date the accrual is to
				  begin. AFUDC will accrue during construction; however, the accrual under this
				  Rule shall begin no sooner than the date construction is completed and continue
				  until the date new rates become effective in the LDC's next general rate case
				  in which the investment in the Transmission Facilities are included in the
				  LDC's rate base. The Commission, however, may terminate the accrual upon the
				  motion of any interested party and after notice to the LDC and opportunity for
				  hearing. The accrual under this Rule for a particular project shall not exceed
				  five (5) years unless so authorized by the Commission upon a showing by the LDC
				  of good cause.
(b) For the purposes
				  of this Rule, "Transmission Facilities" shall include the gas pipeline and all
				  appurtenant related facilities, including land, mains, valves, meters,
				  boosters, regulators, compressors and their driving units and appurtenances,
				  and other related equipment constructed as part of the Project, the purpose of
				  which is to facilitate the transportation of natural gas from an interstate
				  pipeline, other portions of the LDC's system including existing transmission
				  mains, or other suppliers of gas for ultimate delivery to a distribution
				  system(s). Transmission Facilities shall end at the inlet side of the equipment
				  which meters or regulates the entry of gas into one or more distribution
				  systems.
(c) In determining whether
				  to approve a request under this rule, the Commission will consider the
				  desirability of providing gas service to the new area covered by the Project,
				  the size and relative infeasibility of the Project for which deferral
				  accounting is sought, the LDC's overall expansion plans as reported pursuant to
				  G.S.
				  62-36A, the LDC's currently earned return on
				  equity, the amount of the investment as a percentage of the LDC's rate base and
				  the amount of the anticipated accrual as a percentage of the LDC's revenues,
				  the estimated impact of the accrual on rates when the investment is included in
				  the LDC's rate base in a general rate case, and any other factors affecting the
				  public interest.
(d) The
				  anticipated accrual under this Rule shall not affect the calculation of the net
				  present value of a Project for the purpose of the use of an expansion fund
				  pursuant to
				  G.S.
				  62-158 and Rule R6-84. Approval of the use of
				  expansion funds as partial funding for a Project pursuant to
				  G.S.
				  62-158 is not required for the Project to be
				  eligible for Commission approval of the deferral accounting treatment under
				  this Rule.
(e) Upon receiving
				  Commission approval, the LDC may, on a monthly basis, debit the account in an
				  amount equal to the LDC's currently authorized overall rate of return on its
				  investment in Transmission Facilities constructed as part of Projects that have
				  been completed but not included in rate base.
NCUC Docket No. G-100,
					 Sub 68, 10/13/95.