Highlights:

• 10 utilities in 7 U.S. states initiated new GRCs in Q3 2018.
• 9 GRCs concluded in Q3 2018.
• 38 GRCs were still pending at the close of Q3 2018.
• GRCs increasingly address DERs, grid modernization, and new rate and pricing options, including utility green tariffs and community solar options.
• 3 of the GRCs filed in Q3 2018 proposed replacing net metering with an alternative DG rate that would significantly reduce the financial benefits of rooftop solar.
• Proposed residential fixed-charge increases ranged from 0% to 129% in Q3 2018.

General rate cases — In addition to setting rates for customers, investor-owned utility (IOU) general rate cases (GRCs) are increasingly a forum for renewable energy policy battles. For example, utility green tariffs, net metering successor tariffs, new rate designs, community solar programs, and grid modernization investments are among the growing list of important clean energy issues that utilities have raised in recent GRC filings.

The map below shows where rate cases for investor-owned electric utilities were active as of September 30, 2018. Scroll over any U.S. state to find out which utilities in that state have pending GRCs.

In Q3 2018, 10 utilities in seven states filed new GRCs. Only one utility requested maintaining its existing monthly residential fixed charge, with the other nine utilities seeking increases of at least 20% and an overall average increase of 45%.

In Louisiana, Entergy New Orleans requested a residential fixed charge increase from $8.07 to $18.48, which was the largest increase requested on both a percentage and absolute basis in Q3 2018. In contrast, PSO in Oklahoma proposed maintaining its residential fixed charge, although at $20.00 it is already one of the highest of any IOU in the nation.

In Michigan, DTE and Upper Peninsula Power separately filed new GRCs that each included fixed charge increases, as well as new DG tariffs to replace net metering. Michigan IOUs were required to include new DG tariff proposals in their GRCs filed beginning in the summer of 2018 as a result of energy legislation that passed in December 2016. As proposed by the utilities, the DG tariffs would reduce compensation for electricity exported to the grid while tacking on an extra “System Access Contribution,” which would be a new monthly charge imposed on DG customers based on the size of the DG system.

Figure 1: Proposed Residential Fixed-Charge Increases, GRCs Filed in Q3 2018

© 2018 EQ Research LLC

Although IOUs continued to propose large residential fixed charge increases, they were largely unsuccessful in getting increases approved in GRCs decided during Q3 2018. Overall, seven of nine GRCs that were decided in Q3 2018 resulted in no or minimal fixed charge increases on residential customers. Decisions were also issued in the second phase of two Arizona GRCs that addressed DG tariffs and other utility clean energy programs and DER tariff offerings.

Even though the Public Utilities Commission of Ohio approved a large percentage increase in Dayton Power & Light’s fixed charge, the resulting $7.00 charge is still modest compared to other IOUs. In North Dakota, Otter Tail Power’s monthly fixed charge increased significantly, but the $14.00 per month charge approved by state regulators was less than the $17.70 the utility originally proposed.

In addition to the nine GRCs decided in Q3 2018, the Arizona Corporation Commission issued final decisions in second phases of rate cases filed by UNS Electric and Tucson Electric Power (TEP), addressing changes to the utilities’ tariffs and compensation rate for customers installing a new DG system. The decisions implement new rate design options and a value of solar compensation mechanism for DG customers, but rejected the utilities’ proposals to allow a “grid access charge” on DG customers.

Figure 2: Existing vs. Proposed vs. Approved Residential Fixed-Charge Increases, GRCs Decided in Q3 2018

© 2018 EQ Research LLC

Figure 3: Existing vs. Proposed vs. Approved Residential Fixed-Charge Increases, GRCs Decided in Q3 2018

© 2018 EQ Research LLC

EQ Research summarizes new GRCs initiated by investor-owned electric utilities, available for purchase on our marketplace or as a subscription. Contact us at info@eq-research.com for more information.