Denial for proposed late charge hike endorsed

Commonwealth Public Utilities Commission hearing examiner Harry M. Boertzel recommended the denial of the proposed increase in late charge assessed by the Commonwealth Utilities Corp. to its customers.

In its June 13 report to the commission, Boertzel specifically endorsed that CUC be directed to continue implementing the current electric service late charge of 1 percent of the past due and the said amount be extended to both wastewater and water services.

CUC has petitioned the commission to allow the electric service late charge to increase from 1 percent of past due to 10 percent of past due—an amount described by the hearing examiner as unreasonable and should be denied.

“The proposed increase in the electric service late charge from 1 percent to 10 percent is unreasonable and should be denied. The existing 1 percent late charge should extended to both wastewater and water service,” the hearing examiner’s report indicated.

In the analysis provided by the hearing examiner, a late charge provision does not appear in service regulations for either the water or wastewater divisions.

“The record is unclear whether CUC has been assessing a late charge for water and wastewater services. It is also unclear whether the late charge would be assessed on a customer who has entered into an installment agreement with CUC regarding the payment of account arrearages,” stated the report.

Boertzel recalled that in a rebuttal from CUC consultant economists.com’s Dan Jackson, the consultant recognized that the proposed late charge increase was a deterrent rather than cost-based and served only as a recommendation given CUC’s findings that the current charge was not working.

“He (Jackson) recognized that the amount of the charge was a regulatory policy call. CGC found the proposed 1,000-percent fee increase to be unconscionable given current economic conditions and that it was also inconsistent with the ‘just and reasonable’ standard,” the report further indicated.

Boertzel also recommended the deferral of some non-revenue rate fees petitioned by CUC. These include a proposed new renewable energy fees for installation and annual inspection pending a legal review of whether they are consistent with the requirement of Public Law 15-87.

Other items for deferral are the CUC’s request to increase the new single-phase service connection fee from $135 to $450 and to establish new fees for the three-phase new service connection and for after-hour new single-phase service connection. He recommended that a study be conducted first to address the concerns raised on these proposals as presented by the CPUC consultant in its tes imony filed on May 17, 2014.

Meantime, the hearing examiner expressed support to three other non-revenue rate fees as endorsed by CUC. These included the proposed new $550 unauthorized electric service reconnection fee; the proposed new $200 reconnection at the pole fee; and the proposed increase in the investigation fee from $60 to $210, which he described as “necessary, just, and reasonable,” but is subject to terms and conditions.