Highlights: PA PUC Public Session of October 9, 2008

Note: Audio from each public meeting is available on the Pennsylvania Public Utility Commission’s website for approximately six months.  To access the audio stream for this public meeting, please visit http://www.puc.state.pa.us/general/PMAudio.aspx.  The public meeting calendar and agendas may be viewed at http://www.puc.state.pa.us/general/public_meeting.aspx.

At the October 9, 2008 Public Meeting of the Pennsylvania Public Utility Commission (“Commission”), the Commissioners adopted Staff’s recommendations for action by a vote of 5-0 on all items listed on the Main Agenda and Carry-In Agenda, except as reflected herein below under the respective Commission agenda headings.  Review of particular items addressed by the Commissioners at this Public Meeting which may be of interest are also addressed under the respective Commission agenda headings below.  Any relevant motions and statements are attached hereto and to the original of this Session Memo filed in the Public Meeting Agenda and Session Memo binder.  The next regular Public Meeting is tentatively scheduled for Thursday, October 23, 2008 at 10:00 a.m.  The minutes of the Public Meeting of September 11, 2008, were approved, by a vote of 5-0, without modification.

Bureau of Transportation and Safety

1. All matters approved as submitted.

Bureau of Audits

• The York Water Company, AUD-0055, D-07MGT004.  Focused Management and Operations Audit.  Staff has completed the audit of YWC and issued a report containing 13 recommendations.  The Company has submitted an Implementation Plan indicating acceptance of all 13 recommendations.  Staff recommends that the Commission make the Audit Report and Implementation Plan public.  Statement of Commissioner Pizzingrilli attached commending the Commission's audit staff for conducting a thorough and comprehensive audit of the management and operations of York Water and stating that the Commission is a board member of PA One Call, which is dedicated to minimizing utility service interruptions, reducing on the job injuries and deaths, promoting a higher level of public safety and protecting the environment; the Commission will continue to partner with PA One Call to educate the public on the importance of calling 811 and by implementing comprehensive damage prevention programs and that the Commission's Bureau of Transportation and Safety, Gas Safety Division, continues to work closely with PA One Call to determine what changes in filing requirements may be necessary to ensure that preventative measures are being taken to avoid damages; that all damages are reported, and One Call is able to sufficiently track information and take appropriate action.  Vote of 5-0 with no further discussion.

• UGI Utilities, Inc. and UGI Penn Natural Gas, Inc., AUD-0057, D-07MEI005.  Management Efficiency Investigation Evaluating the Implementation of Selected Recommendations from the 2005 Focused Management and Operations Audit of UGI.  Staff made 15 follow-up recommendations for improvement.  The Company's Implementation Plan indicated acceptance of all staff follow-up recommendations.  Staff recommends that the Commission make the MEI report and the Companies' Implementation Plan Public.  Motion of Vice Chairman Christy attached moving that a non-prosecutory staff investigation is hereby instituted to investigate gas beyond the mains programs and propane distribution systems, the investigation is assigned to the Law Bureau which, in conjunction with the Bureaus of FUS, Audits and Transportation and Safety, shall initiate and conduct the investigation and submit a report to the Commission on or before March 31, 2009, the Law Bureau prepare an appropriate Opinion and Order consistent with this Motion, this Opinion and Order be served upon all jurisdictional natural gas distribution companies, the Energy Association of Pennsylvania and the Pennsylvania Propane Association and that the Secretary shall cause this Order to be published in the Pennsylvania Bulletin.  Statement of Commissioner Pizzingrilli attached (similar to Statement in York Water, above), advising that the Commission is a board member of PA One Call, which is dedicated to minimizing utility service interruptions, reducing on the job injuries and deaths, promoting a higher level of public safety and protecting the environment.  The Commission will continue to partner with PA One Call to educate the public on the importance of calling 811 (Call before You Dig) and that all public utility must do their part by educating employees and contractors as part of their comprehensive damage prevention programs.  Vote of 5-0 with no further discussion.

Bureau of Conservation, Economics and Energy Planning

1. All matters approved as submitted.

Office of Special Assistants

1. Malisa Alexander v. Philadelphia Gas Works, (Service Issue) 1204079-OSA-0013, C-20077389.  Exceptions to the February 26, 2008 Initial Decision of ALJ Jones were filed by PGW on March 17, 2008.  The Complainant filed Reply Exceptions on March 27, 2008.  Staff recommends that the Commission adopt the proposed Opinion and Order denying PGW's Exceptions and adopting the ALJ's Initial Decision, consistent with the proposed Opinion and Order.  Motion of Chairman Cawley that the ALJ properly evaluated the evidence, however, PGW is a municipally owned gas utility and that all of its operating costs are included in the rates charged to its customers.  Fining PGW for its violations of public utility laws as recommended by the ALJ would be futile in that it would do little more than hurt the ratepayers.  Therefore, Chairman Cawley's Motion moves that the Initial Decision of the ALJ be modified consistent with this Motion, the relevant bureaus, in conjunction with the Law Bureau, develop a procedure to track and report all violations of the Pennsylvania Public Utility Code, regulations and Commission orders by PGW be considered in cumulative fashion in subsequent PGW filings, and that the OSA prepare an Opinion and Order consistent with this Motion.  Dissent of Vice Chairman Christy stating Commission should levy the fine.  Vote of 4-1 with no further discussion.

1. PA PUC v. Columbia Gas of Pennsylvania, Inc., 2011621-OSA-0039, R-2008-2011621, et. al.  A Recommended Decision was issued August 19, 2008 by ALJ Melillo and ALJ Dunderdale recommending that the Joint Petition for Settlement filed by all of the parties be approved.  The Settlement provides for an Increase of $41.5 million in annual operating revenues.  One Issue remains unresolved regarding the Company's Purchase of Receivables.  Exceptions were filed by the Natural Gas Suppliers on September 8, 2008.  Staff recommends that the Commission adopt the proposed Opinion and Order denying the Exceptions and adopting the ALJ's Recommended Decision.  This matter has been postponed until Public Meeting of October 23, 2008.

1. Petition of the Pennsylvania State University Declaratory Order Concerning the Generation Rate Cap of the West Penn Power Company D/B/A Allegheny Power, 2021608-OSA-18, P-2007-2001828, P-2008-2021608.  On September 26, 2008, West Penn Power Company filed a Petition for Reconsideration of one issue in the PUC's Opinion and Order entered September 11, 2008.  Staff recommends that the Commission adopt the proposed Opinion and Order granting reconsideration, pending review of and consideration of the merits.  Vote of 5-0 with no discussion.

1. PA PUC Prosecutory Staff v. UGI Utilities, Inc., 2036549-OSA-0003, M-2008-2036549.  On April 14, 2008, the Prosecutory Staff and UGI filed a Settlement Agreement and Joint Statement in Support of Settlement Agreement in order to satisfy the Complaint filed by the Prosecutory Staff.  The Complaint was filed as a result of an explosion that occurred on September 2, 2006, in UGI's service territory.  As part of the Settlement, UGI agreed to pay a civil penalty of $40,000.  Prosecutory Staff filed comments to the Commissions' August 22, 2008 Tentative Opinion and Order.  The Prosecutory staff filed comments on August 23, 2008 to the Tentative Order.  Staff recommends that the Commission adopt the Final Opinion and Order, affirming, as modified, the August 22, 2008 Tentative Opinion and Order.  This matter has been postponed until Public Meeting of October 23, 2008.

Bureau of Fixed Utility Services

1. IDT America, Corp., 2055471-FUS-0004, A-2008-2055471, A-2008-2055473.  Application filed August 7, 2008, for approval to offer, render, furnish, or supply Telecommunications Services as a Competitive Local Exchange carrier in the service areas of Bentleyville Telephone Company and Marianna & Scenery Hill Telephone Company.  Staff recommends that the Commission adopt the proposed Order.  Vote of 5-0 with no discussion.

Combined Bureau Agenda

1. Needmore Water Supply Company, Inc., 2049231-FUS-0014, R-2008-2049231, OTS-0024, R-2008-20439231.  Supplement No. 7 to Tariff Water-Pa. P.U.C. No. 1 filed August 20, 2008, proposing an annual increase in rates of $53,335 to become effective October 20, 2008.  FUS recommends that the Commission institute an Investigation noting that the Tariff will be suspended by operation of law until May 20, 2009 and that the matter be referred to the OALJ, consistent with the proposed Order.  OTS recommends that an investigation be instituted and the tariff be suspended.  Chairman Cawley moves to adopt the FUS recommendation and adopt the OTS recommendation to the extent consistent with the FUS recommendation.  Vote of 5-0 with no further discussion.

Law Bureau

• Pennsylvania American Water Company's Main Breaks, L-0087*, I-00060112.  Investigation in the Pittsburgh Area and Related Incidents Statewide – Phase II.  Staff recommends that the Commission adopt the proposed Tentative Order that, among other things, releases the Investigative Report to the public.  Motion of Commissioner Pizzingrilli that Phase II investigative report be released to the public, that the Law Bureau prepare a Tentative Order consistent with this motion and with the findings and recommendations of the Investigative report associated with Phase II, if no comments are filed to the Tentative Order within 15 days, it shall become final without further action to the Commission; Pennsylvania American Water Company continue to implement the best practice recommendations and directives identified in the Phase I Order entered July 26, 2007; copies of this Order be served on OTS, OCA, OSBA, DEP, Pa. Chapter of the National Association of Water Company and all jurisdictional water companies.  Vote of 5-0 with no further discussion.

• Intrastate Access Charges and IntraLATA Toll Rates of Rural Carriers,
  L-0097*, I-00040105, P-00981430F1000, R-00061377, P-00981428F1000, R-00061375,
  P-00981429F1000, R-00061376.  Investigation regarding the Pennsylvania Universal Service Fund (Petitions for Reconsideration and Clarification).  Staff recommends that the Commission grant in part and deny in part the Petitions for Reconsideration.  Vote of 5-0 with no discussion.

• Verizon North Inc., L-0099*, P-00001854F1000.  Petition for BFRR Deployment Extensions.  Staff recommends that the Commission adopt the proposed Order granting the Petition.  Vote of 5-0 with no discussion.

Office of Administrative Law Judge

• Patricia Bradley, et al. v. Three Lane Utilities, Inc., ALJ-0028*, C-20077402, et al.  On February 3, 2006, thirty-seven complaints were filed alleging flat rates were being charged to the Complainants instead of metered rates, and that all meters had not been installed as required by Commission Order entered June 24, 2005.  A hearing was held on May 30, 2007.  Staff reviewed ALJ Jandebeur's Initial Decision dismissing the complaints.  Statement of Chairman Cawley agreeing with the ALJ that the Complaint should be dismissed as moot since the Respondent's customers will now be charged under PAWC's Zone 1 rate schedule.  Vote of 5-0 with no further discussion.

• Jayalin Sybliss v. UGI Penn Natural Gas Inc., ALJ-0164, C-20067141.  On November 30, 2006, a complaint was filed alleging a billing dispute.  UGI Penn Natural Gas filed its answer on December 22, 2006.  A hearing was held on January 30, 2007.  Staff reviewed ALJ Jandebeur's Initial Decision dismissing the complaint.  Motion of Commissioner Gardner stating that the Landlord should be given the opportunity to provide evidence to show responsibility of foreign load and that the matter be remanded to the OALJ to afford the landlord in this case the opportunity to contest responsibility for the balance which was transferred from the tenant's account and that the OSA prepare the appropriate Opinion and Order.  Vote of 5-0 with no further discussion.

• Derrick Williams v. PECO Energy Company, ALJ-0168, F-02045571.  On September 30, 2006, a complaint was filed alleging a billing and service dispute.  On November 9, 2006, PECO filed its answer.  A hearing was held on February 21, 2007.  Staff reviewed ALJ Fordham's Initial Decision sustaining the complaint in part.  Motion of Commissioner Gardner stating that the Landlord should be afforded the opportunity to contest responsibility for the $2,564.55 balance which was transferred from the tenant's account, that the case be remanded to the OALJ for further development of the record and that the OSA prepare the appropriate Opinion and Order.  Vote of 5-0 with no further discussion. 

CARRY-IN AGENDA

Office of Special Assistants

1. PA PUC v. Equitable Gas Company Independent Oil and Gas Association of PA v. Equitable Gas Company, 2029325-OSA-0028, R-2008-2029325 et. al.  Exceptions to ALJ Corbett's September 17, 2008 Recommended Decision filed by IGS and Equitable.  Staff recommends that the Commission adopt the Proposed Opinion and Order adopting the Recommended Decision.  Motion of Chairman Cawley attached that despite the Commission's desire to encourage participation by NGSs, the record in this case indicates that IGS has not presented evidence of any substantive effort to apply for the authority to serve customers in the Company's service area, nor has it plainly articulated a clear desire to even serve customers in Equitable's service.  For this reason, IGS's petition should be denied, that the Recommended Decision be modified, consistent with this Motion, and that the OSA draft an appropriate order consistent with this Motion.  Vote of 4-0 with Vice Chairman Christy concurring in result only and Commissioner Gardner abstained.

• Buffalo Valley Telephone Company, ET. AL., 1189996-OSA-0059, I-00401504, P-00981428F100 et. al., R-00061375 et. al.  Joint Petition to rescind and/or amend prior Commission Orders; Petition of AT&T to Intervene.  Staff recommends that the Commission adopt the proposed Opinion and Order which disposes [denies] of the Joint Petition and grants AT&T and BCAP Petitions to Intervene.  Statement of Chairman Cawley attached supporting the denial of the Recission Petition, not that we shall continue to grapple with the underlying substantive issues in the pending appeals and in our limited investigation at Docket No. I-00040105.  Vice Chairman Christy associates himself with Chairman Cawley's statement.  Dissenting Statement of Commissioner Powelson attached siding with D&E in that it was justified in seeking to avoid an increase in local rates.  Vote of 4-1 with no further discussion.

Commissioners

• Motion of Chairman James H. Cawley In Re:  Modifications to Regulations and Guidelines Required for Purchase of Receivables Programs, C-0009.  Motion of Chairman Cawley moving that the OSA prepare a Secretarial Letter consistent with the Motion, that the Secretarial Letter be served on all natural gas distribution companies, natural gas suppliers, the OCA and all other participants in the SEARCH proceeding, interested parties be required to provide comments within 20 days of the entry of the Secretarial Letter, that reply comments be submitted with 35 days of the entry of the Secretarial Letter, is attached.  This matter has been postponed until Public Meeting of October 23, 2008.

• JOINT MOTION OF COMMISSIONER PIZZINGRILLI AND POWELSON IN RE:  PROCUREMENT, CONSERVATION & ENERGY EFFICIENCY IMPLEMENTATION, C-0010, M-         .  Joint Motion attached that as soon as the Governor signs House Bill 2200 into law, the Director of Operations convene a working group to develop an implementation plan.  Vote of 5-0 with no discussion.  Statement of Chairman Cawley on the passage of House Bill 2200 is also attached.

NO ANNOUNCEMENTS

THE NEXT REGULAR MEETING IS SCHEDULED FOR THURSDAY, OCTOBER 23, 2008 AT 10:00 AM

• * Denotes Order