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PA Bulletin, Doc. No. 15-976

NOTICES

INDEPENDENT REGULATORY REVIEW COMMISSION

Notice of Comments Issued

[45 Pa.B. 2561]
[Saturday, May 23, 2015]

 Section 5(g) of the Regulatory Review Act (71 P. S. § 745.5(g)) provides that the Independent Regulatory Review Commission (Commission) may issue comments within 30 days of the close of the public comment period. The Commission comments are based upon the criteria contained in section 5.2 of the Regulatory Review Act (71 P. S. § 745.5b).

 The Commission has issued comments on the following proposed regulations. The agency must consider these comments in preparing the final-form regulation. The final-form regulation must be submitted within 2 years of the close of the public comment period or it will be deemed withdrawn.

Close of the Public IRRC Comments
Reg No. Agency/Title Comment Period Issued
#57-307 Pennsylvania Public Utility Commission
Automatic Adjustment Clauses Related to
 Electric Default Service
45 Pa.B. 1258 (March 14, 2015)
4/13/15 5/13/15
#57-308 Pennsylvania Public Utility Commission
Paper Billing Fees
45 Pa.B. 1264 (March 14, 2015)
4/13/155/13/15

Pennsylvania Public Utility Commission
Regulation #57-307 (IRRC #3088)

Automatic Adjustment Clauses Related to
Electric Default Service

May 13, 2015

 We submit for your consideration the following comments on the proposed rulemaking published in the March 14, 2015 Pennsylvania Bulletin. Our comments are based on criteria in Section 5.2 of the Regulatory Review Act (71 P. S. § 745.5b). Section 5.1(a) of the Regulatory Review Act (71 P. S. § 745.5a(a)) directs the Pennsylvania Public Utility Commission (PUC) to respond to all comments received from us or any other source.

Section 54.190. Universal interest applicable to over collections and under collections resulting from reconciliation of automatic adjustment clauses costs and revenues related to electric default service.—Reasonableness; Economic Impact; Impact on Small Business; Implementation procedure; Clarity.

Subsection (c)

 The proposed regulation establishes the prime interest rate to be applied to the reconciliation of over and under collections. In this subsection, the prime interest rate is specified ''as reported in the Wall Street Journal or other publically available source identified by the Commission.'' We have two concerns. First, in support of the phrase ''or other publically available source identified by the Commission,'' the PUC's order states it cannot predict whether the Wall Street Journal will continue to be the most appropriate market index for purposes of determining the prime rate of interest, and if the PUC switches to a different index it will properly notify all interested parties. It is not clear what other rate the PUC would contemplate in the future, who would be notified, how notice would be provided or what opportunity there would be for comment prior to the change. Why wouldn't the PUC's general powers to rescind and modify regulations under 66 Pa.C.S.A. §§ 501(a) and (b) be sufficient? The PUC could then rescind the regulation and modify it by a rulemaking with review by the public, utilities, legislature and this commission. For these reasons, we recommend deleting the phrase ''or other publically available source identified by the Commission.'' Alternatively, the PUC should explain and support the need for the phrase and how changing the interest rate outside of the rulemaking process is in the public interest.

 Second, if the PUC maintains the phrase, the language of the proposed regulation would permit a utility to choose between the Wall Street Journal rate ''or'' the new rate identified by the PUC. We recommend that the PUC clarify the language of the regulation to specify which rate must be used by the utility should the PUC specify a source other than the Wall Street Journal.

Reliance on the prime rate of interest

 First Energy observed that while the prime rate of interest recently has been low, it was as high as 21.5% in the 1970s and 1980s. First Energy recommends an ''escape hatch'' so that customers are not exposed to significant swings in interest rates and also recommends simply using the current legal interest rate of 6%. We recognize that 52 Pa. Code § 54.187(g) of the existing regulation relies on ''the legal rate of interest,'' so the PUC has experience with using the legal rate of interest. The PUC should explain why the regulation's reliance on the prime rate of interest is the best alternative.

Implementation of the new interest charge computation

 PECO commented that its currently approved default service plan runs into the year 2017 and would potentially conflict with a finalized regulation until PECO could accommodate the change in its next default service plan. First Energy requests that the PUC allow them to maintain the interest charge calculation specified in its tariffs until the process in the proposed regulation can be adequately transitioned, reviewed and audited. In the final rulemaking, the PUC should explain how the implementation timeline of the new requirements is reasonable.

Pennsylvania Public Utility Commission
Regulation #57-308 (IRRC #3087)

Paper Billing Fees

May 13, 2015

 We submit for your consideration the following comments on the proposed rulemaking published in the March 14, 2015 Pennsylvania Bulletin. Our comments are based on criteria in Section 5.2 of the Regulatory Review Act (71 P. S. § 745.5b). Section 5.1(a) of the Regulatory Review Act (71 P. S. § 745.5a(a)) directs the Pennsylvania Public Utility Commission (PUC) to respond to all comments received from us or any other source.

1. Citations to statutory authority.—Clarity and lack of ambiguity.

 When reviewing a regulation, and as required by the Regulatory Review Act (71 P. S. §§ 745.1—745.14), this Commission must first and foremost determine whether the agency has the statutory authority to promulgate the regulation and whether the regulation conforms to the intention of the General Assembly. (71 P. S. § 745.5b.) In response to question #8 of the Regulatory Analysis Form (RAF) submitted with the rulemaking, the PUC has identified several sections of the Public Utility Code and other statutes and regulations to support its statutory authority. However, it is unclear how most of those citations apply to such authority and why they are included. In the Preamble to the final-form regulation, the PUC should explain the applicability of the referenced laws and regulations.

 The PUC cites Section 1509 of the Public Utility Code in the Executive Summary as a statutory basis for amending this regulation. The PUC does not list this section in its response to RAF question #8. In order to assist this Commission in determining if the regulation is consistent with the PUC's statutory authority and intent of the General Assembly, we request the PUC identify the appropriate authority and include those citations in its response to RAF question #8.

2. Section 53.85. Paper billing fees.—Statutory authority; and Reasonableness.

 The proposed rulemaking states that ''A public utility may not impose a supplemental fee, charge or other rate for furnishing a paper bill or invoice for the services provided by the public utility.'' Commentators representing the telecommunications industry questioned the PUC's statutory authority to preclude them from imposing a supplemental fee for providing paper bills.

 We request the PUC clarify its statutory authority for this provision.

3. Miscellaneous clarity.

 The PUC explains in the Preamble that the ''language and location of the proposed regulation in Subpart C. Fixed Service Utilities shall make the prohibition applicable to all Noncommon carrier public utility industries.'' The new language however uses the term ''public utility.'' The term is not defined either in Title 52 of the Pa. Code or in Chapter 53. The statutory definition of ''public utility'' includes a common carrier. We believe including a definition for the term ''public utility'' that excludes common carriers would improve the clarity of the regulation.

 RAF Question #12 asks the PUC to compare the proposed rulemaking with those of other states. The PUC responded that ''The proposed regulation will prohibit utilities from benefitting from an excessive recovery of these monthly billing costs.'' The PUC should include in the final-form regulation a summary of other states' activities regarding monthly paper billing fees.

JOHN F. MIZNER, Esq., 
Chairperson

[Pa.B. Doc. No. 15-976. Filed for public inspection May 22, 2015, 9:00 a.m.]



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