CUC wants commercial rate subsidy removed

Posted on May 14 2014


The Commonwealth Utilities Corp. filed on May 2 a new petition with the Commonwealth Public Utilities Commission for the removal of the commercial rate subsidy.

Public Law 16-7, which was enacted on July 21, 2008, mandated CUC to implement a residential rate reduction or a residential consumer rebate program in the amount of $3.4 million within 54 months after the law is enacted.

On Feb. 4, 2014, the CPUC approved giving residential electric ratepayers a refund of this $3.4 million. The commission authorized CUC to institute 36-month residential refund of $0.23 kWh, which would be funded by a reciprocal increase in commercial rates.

CUC was also ordered to propose how and by what amount the commercial rate should be reduced after 36 months. CUC was also required to certify on or before March 1, 2017, that the refund and commercial rate increase have been terminated.

According to CUC chief financial officer Charles Warren, the refund amount is being tracked as a separate rate element in CUC’s customer information system. He said each rate element is separated out in the billing system.

“CUC proposes to provide periodic reports to CPUC on the cumulative amount and the refund billed every six months,” said Warren in his May 2 written testimony to CPUC.

Warren disclosed that CUC will submit a petition to adjust the commercial rate to remove the subsidy for the refund to be effective when refunds total $3.4 million.

According to the CFO, CUC cannot provide at this time an estimated amount because it does not know the extent of the reduction over particular time periods.

“CUC does not know, at this time, what the total CUC and commercial customer kWh volume will be in three years. This information will be needed to calculate the appropriate reduction for the commercial rates,” added Warren.

Moneth G. Deposa | Reporter

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