DR 96-149
Public Service Company of New Hampshire
Investigation into Light Loading
Order Establishing Technical Conference
O R D E R N O. 22,895
April 7, 1998
APPEARANCES: Brown, Olson and Wilson by Amy L.
Fracassini, Esq., for Concord Regional Solid Waste/Resource
Recovery Cooperative; Brown, Olson and Wilson by Bryan K. Gould,
Esq. and Robert A. Olson on behalf of Bio-Energy Corporation,
Bridgewater Power Company, L.P., Hemphill Power and Light
Company, Pinetree Power, Inc., Pinetree Power-Tamworth, Inc. and
Whitefield Power and Light Company; Bossie, Kelly, Hodes, and
Buckley by Jay L. Hodes, Esq., on behalf of Wheelabrator Concord;
Orr and Reno, by Jonathon A. Chorlian, Esq., for the Granite
State Hydropower Association; Daniel Allegretti, Esq., for
American Hydro, Inc.; Gerald M. Eaton, Esq., for Public Service
Company of New Hampshire; Phillip Munck for Waste Management of
NH; Wynn Arnold, Esq., for the Office of the Governor; Michael
Holmes, Esq., for the Office of Consumer Advocate; and Eugene F.
Sullivan, III, Esq. for the Staff of the New Hampshire Public
Utilities Commission.
I. PROCEDURAL HISTORY
On May 14, 1996, the New Hampshire Public Utilities
Commission (Commission) issued an Order of Notice opening an
investigation into the issue of "light loading" as it relates to
certain of the State's largest Small Power Producers (SPPs) or
Qualifying Facilities (QFs) selling power to Public Service
Company of New Hampshire (PSNH) under rate orders.
In the most recent PSNH Fuel and Purchase Power
Adjustment Clause (FPPAC) proceeding, DR 97-014, the Office of
the Governor and the Commission Staff filed testimony
recommending the deferral of recovery by PSNH of certain monies
paid by PSNH to QFs. The Office of the Governor and Commission
Staff questioned whether PSNH was required to purchase some of
the output of the QFs under certain circumstances pursuant to
Federal Energy Regulatory Commission (FERC) rules and the terms
of the rate orders. Based on the testimony of Staff and the
Office of the Governor, the Commission required PSNH to defer
recovery of $10 million per FPPAC period until the issue is
resolved. See, Order No. 22,847 (February 10, 1997).
On January 12, 1998, the Commission issued a revised
Order of Notice expanding this proceeding to include "the
investigation [of] all QFs currently selling power to PSNH under
long term rate orders as parties to the proceeding." The Order
of Notice scheduled a prehearing conference for February 19,
1998.
Freshwater Hydro, Inc., Salmon Falls Hydroelectric
Facility, Watson Dam Hydroelectric Project, Newfound
Hydroelectric Co., Union Village Dam, SPP Hydro Stations Waterloo
Falls, Otis Falls and Chamberlain Falls and Alden Engineering,
Powerhouse Systems, Inc., Southern New Hampshire Hydroelectric,
Mad River Power Associates, Ashuelot Paper Company and Lower
Robertson Dam, Pittsfield Hydropower Company, Inc., Otter Lane
Hydro, and Hadley Falls Hydro filed motions to intervene. Waste
Management of NH filed a motion for limited intervention. The
Commission granted all requests for intervention at the
prehearing conference.
At the prehearing conference, the Granite State
Hydropower Association stated that it appeared for only those
hydropower QFs selling power to PSNH under rate orders and
contended that any findings relative to load curtailment in this
proceeding should not apply to QFS selling power to PSNH under
contracts.
With regard to an appropriate procedural schedule, the
wood-fired SPPs and a number of other parties argued that Staff
should be required to file a memorandum of law explaining its
theory of the case. Staff responded that it believed it would be
more efficient to hold a technical session to examine how PSNH
had developed the long term avoided costs under which QFs were
selling power to PSNH. Staff argued that this might shed light
on the threshold issue of whether negative avoided costs had been
included in the calculations.
II. COMMISSION ANALYSIS
With regard to the scope of this proceeding, this order
will serve as notice clarifying that the issue of light load
curtailments applies to all QFs selling power to PSNH pursuant to
the requirements of the federal Public Utility Regulatory
Policies Act (PURPA) or RSA 362-A. This applies whether the
required purchase of power was styled as a "rate order" or
"contract". This does not, however, include those contracts
which were entered into outside the parameters or mandate of
PURPA, RSA 362-A, or the rules and orders implementing those
statutory provisions.
With regard to the procedural schedule, we agree with
Staff that the first issue to address in this proceeding is
whether negative avoided costs were included in the calculation
of avoided costs as the answer to that question would potentially
conclude this proceeding.
Based upon the foregoing, it is hereby
ORDERED, that a technical session be held on April 22,
1998, at 10:00 a.m. at the Commission offices to investigate
whether PSNH included negative avoided costs in the calculation
of long term avoided costs used to set the rates to be paid to
QFs and to develop a procedural schedule to investigate further
that discrete issue if necessary; and it is
FURTHER ORDERED, that this proceeding applies to all
QFs selling power to PSNH under long term rates pursuant to the
mandates of PURPA and RSA 362-A whether styled as a rate order or
contract; and it is
FURTHER ORDERED, that a copy of this order be served
upon all QFs selling power to PSNH to provide notice of the scope
of this proceeding.
By order of the Public Utilities Commission of New
Hampshire this seventh day of April, 1998.
Douglas L. Patch Bruce B. Ellsworth Susan S. Geiger
Chairman Commissioner Commissioner
Attested by:
Thomas B. Getz
Executive Director and Secretary