PPL Electric Stmt. 14-RJ at 12-13; PPL Electric MB at 57-58. The Company explains that the purpose of purchasing insurance is to spread losses over an extended period of time and to provide PPL Electric with access to the reinsurance market, which is the source of non-affiliated storm damage insurance available. PPL Electric Stmt. 14-RJ at 5. The following chart shows payments in premiums and its reimbursements from its affiliated insurance company: 2007 2008 2009 2010 2011 Total ($000) Premiums $6,725 $7,260 $6,960 $10,850 $10,850 $42,645 Reimbursements $12,112 $5,032 $0 $5,499 $26,500 $49,143 PPL Electric RB at 24. The Company has adequately explained its use of insurance, and its claims are approved. The issue remaining is the value of money due to the delay in processing claims. I&E points out that the PPL witness Novatnack testified that the Company was required to present only one aggregated claim under the policy, but that reviewing the policy resulted in a change of testimony admitting that it was Company's policy, not the insurance company's requirement at all. This results in an inevitable delay in the payment of claims from the time that the loss is incurred, and provides a benefit to the insurance company to the detriment of the ratepayers. As the amounts of the recovery from the insurance company can be substantial, PPL Electric should be directed to cease this practice and to file its claims on a more frequent basis. c. Damage Reserve Account The I&E recommendation that this Company may be better off with a storm damage reserve account or rider is worth pursuing: If PPL had utilized a risk management approach with a storm reserve account within the regulated utility, its profitability
do not have an incentive to interrupt during an emergency. Accordingly, PPL Electric has proposed a new $25.00 per kW penalty for load that exceeds the interruptible requirement during the period of the requested interruption. PPL Electric also has proposed the elimination of the Time of Day provisions of Rate Schedule IS-1. Instead, the customer’s demand will be the maximum 15-minute demand in the month without Time of Day considerations. Finally, PPL Electric has proposed to decrease the customer charge from $840.00 per month to $40.00 per month, the same as that proposed for Rate Schedule GS-3, and to introduce a demand charge of $2.75 per kW. PPL Electric St. 5, pp. 18-19. This proposal was unopposed and should be approved. Commercial space Heating – Rate Schedules GH-1 and GH-2: All GH-1 customers currently are paying more for distribution service than they would pay on comparable rate schedules. PPL Electric has proposed to eliminate Rate Schedule GH-1 and transfer the remaining customers to Rate Schedules GS-3, or GS-1, depending on the service voltage and number of phases supplied by the Company. For Rate Schedule GH-2, the Company proposes to increase the customer charge from $14.00 per month to $16.00 per month. PPL Electric St. 5, pp. 19-20; PPL Electric Exs. DAK 1, DAK 2; PPL Electric Ex. No. 1, Exhibits Regs., § 53.53, Part IV, Questions C through E. This proposal was unopposed and should be approved. PPL Electric MB at 157-162 (emphasis added). i. Residential The residential distribution schedules are Residential Service (RS), Residential Thermal Storage (RTS), and Residential Time-of-Day (RTD). The Company proposes raising the Rate Schedule RS customer charge from its present $8.75 per month to $16.00 per month. The Company points out that its COSS supports a charge of $36.70, and this increase moves the rate schedule closer to the cost of serving it. PPL Electric MB at 162-163. OCA opposes the increase to residential customers because it is based on the COSS which it also opposes. This issue was disposed of earlier, and the OCA alternative to the
fee, but recommends that the Company’s miscellaneous revenues be increased. These parties’ concerns are addressed above. Generation Rate Adjustment (GRA) Rider – The GRA Rider expired on January 1, 2011. PPL Electric proposed to remove all references to the GRA from the STAS and Rate Schedules. PPL Electric St. 5, p. 22; PPL Electric Ex. DAK 2. This proposal was unopposed and should be approved. Universal Service Charge Rider (USR) – PPL Electric proposed to delete the Rate Schedule RTD (R) reference that was removed from the Tariff. PPL Electric also proposed to revise the filing date to December 21 of each year. Finally, the Company proposed to delete the sentence “The third quarter report shall be accompanied by a preliminary forecast of the USR charge for the next computation year.” PPL Electric Ex. DAK 2. This proposal was unopposed and should be approved. Rate Stabilization Plan Rider – The Rate Stabilization Plan Rider expired on December 31, 2011. PPL Electric proposed to remove this Rider. PPL Electric St. 5, p. 22; PPL Ex. DAK 2. This proposal was unopposed and should be approved. Competitive Transition Charge (CTC) Reconciliation Rider – The CTC Reconciliation Rider expired December 31, 2010. PPL Electric proposed to remove this Rider and all references to it from Rule 6 and 6A, Net Metering, and the Rate Schedules. PPL Electric St. 5, p. 22; PPL Ex. DAK 2. This proposal was unopposed and should be approved. Renewable Energy Development (RED) Rider – The Net Metering for Renewable Customer-Generators Rider already addresses the eligibility, terms, and conditions applicable to all renewable customer-generators less than or equal to 10 kW. PPL Electric therefore has proposed to remove the RED Rider. PPL Electric St. 5, p. 22; PPL Electric Ex. DAK 2. This proposal was unopposed and should be approved. Net Metering for Renewable Customer-Generators Rider – PPL Electric proposed two changes to its Net Metering tariff provisions for Renewable Customer-Generators. First, PPL Electric proposed to establish a limitation on the size of generator relative to the associated customer usage that would be eligible for net metering. Second, PPL Electric proposed to clarify that, for eligible customer-generators served under PPL Electric’s Time Of Use default service rate option, a weighted average of the on-peak