Consumer Assistance | Energy | Telecom | Warehouse | Commission Actions | Miscellaneous

SOUTH DAKOTA PUBLIC UTILITIES COMMISSION
2015 Highlights

Leadership
Chairperson Chris Nelson
Vice Chairperson Kristie Fiegen
Commissioner Gary Hanson

Electric
Energy Efficiency
Grain Warehouse
Legislation
Natural Gas
Pipeline Siting, Safety and Inspection
Public Outreach and Consumer Assistance
Renewable Energy
Telecommunications
Wireless

ELECTRIC

  • In March, the commission approved a settlement agreement allowing Black Hills Power to increase rates by 4.35 percent to generate an additional $6.89 million in annual revenues, a significant reduction from the company’s request of a 9.94 percent increase. The closure of three coal-fired power plants and the resulting construction of the natural-gas fired Cheyenne Prairie Generating Station as well as the repair and replacement of infrastructure damaged by winter storm Atlas were primary drivers of the rate increase request.
  • Accepted a settlement agreement in May between Black Hills Power and PUC staff to approve the company’s environmental improvement adjustment. The company made environmental improvements at its jointly-owned Wyodak and Wygen III power plants to comply with EPA’s Maximum Achievable Control Technology rule. The average bill impact for a typical residential customer using 650 kWh per month is $0.08.
  • The commission accepted a settlement agreement from Xcel Energy and PUC staff in June that allowed Xcel to increase base rates and implement an infrastructure rider to raise approximately $7.795 million in additional annual revenues. The average customer would experience a 4 percent increase in electric rates. Xcel’s original request asked for an increase of 8 percent. Investments to the company’s generation, transmission and distribution facilities and property taxes were among the reasons for the rate increase request.
  • In June, the PUC approved a rate change for MidAmerican Energy Company’s customers via a two-step process. Effective July 13, 2015, rates were implemented resulting in an average increase of 5.66 percent. However, customers saw a reduction on their bills associated with the costs related to a generation project and a transmission project that were placed into service later in the year. This reduction was effective from July 13 until the time both projects are in service, which was Dec. 4, 2015. MidAmerican and PUC staff explained that such a plan serves the best interest of ratepayers by eliminating the need for the company to apply for another, immediate rate increase. The case was the company’s first electric rate hike in two decades.
  • Began processing a request received in July from Montana-Dakota Utilities Company’s to increase its electric rates by 19.2 percent.

  • Allowed NorthWestern Energy to raise its electric rates by 15.5 percent, the first such increase since 1981, by accepting a settlement agreement from the company, PUC staff and interveners Toshiba America Business Solutions, Trail King Industries, Redfield Energy and Wal-Mart Stores in October. The approved increase allowed $20.9 million in additional annual revenues, $5.6 million less than the company requested. A public hearing was held in Yankton in May, at the request of customers. NorthWestern cited the addition of the peaker plant in Aberdeen, federally-required environmental controls at three coal-fired generating plants, integration with the Southwest Power Pool Regional Transmission Organization, and distribution and transmission upgrades, including a transmission project near Yankton, as reasons for the increase.

  • In October, an update to Otter Tail Power Company’s environmental cost recovery rider for the company’s share of improvements at Big Stone and Hoot Lake power plants was approved. The rate impact of the update is approximately 2.5 percent on average.

  • The commission processed a number of transmission cost recovery (TCR) tariff requests with these results:
    • In February, approved an update to Otter Tail Power Company’s TCR rider rate to reflect the 2015 recovery period that included six previously-approved projects and one new transmission project. Otter Tail Power’s request to include North American Electric Reliability Corporation Compliance project costs was denied. The revenue requirement approved for the company for this filing was $1.43 million.
    • In May, approved an update to Black Hills Power’s Transmission Facilities Adjustment that resulted in a 0.09 percent bill decrease for a typical residential customer.
    • In November, approved Xcel Energy’s request to continue recovery of the South Dakota portion related to 15 previously-approved, one new transmission project, MISO Schedule 26 and 26A expenses, and the ADIT Pro-Rate. An average residential customer using 750 kWh per month saw a monthly increase on their bill of $0.21.

  • Commissioner Kristie Fiegen was named to the Southwest Power Pool Regional State Committee where she provides input related to the development and operation of regional bulk electric transmission along with representatives from Arkansas, Iowa, Kansas, Missouri, Nebraska, New Mexico, North Dakota, Oklahoma and Texas. SPP expanded its grid management this year to include Basin Electric Power Cooperative, East River Electric Power Cooperative, Heartland Consumers Power District, Missouri River Energy Services, NorthWestern Energy and the Western Area Power Administration’s Upper Great Plains Region.

  • In November, the South Dakota Supreme Court unanimously affirmed the commission’s decision to grant a permit to Montana-Dakota Utilities Co. and Otter Tail Power Co. to construct a 345kV transmission line between Big Stone City, S.D., and Ellendale, N.D. The PUC’s decision had been appealed by Gerald Pesall of Lily, S.D.
  • Processed 20 electric service territory boundary agreements to verify electric territory mapping data for conversion to electronic format and use in a Geographic Information System database.
  • Following the enactment of legislation regarding stray voltage rules, began the formal rulemaking process in November. Requested and received comments from interested parties including electric providers and dairy producers.
  • Commissioner Gary Hanson offered a Midwest viewpoint in a panel discussion about regulatory compact at the Public Utilities Advisory Council’s Current Issues Forum.
  • Approved an update to Xcel Energy’s infrastructure rider factor in December. The change would add an approximate $3.01 to an average residential customer’s bill and allow Xcel Energy to recover the cost of a number of capital projects.
  • Reviewed the Clean Power Plan final rule issued by the Environmental Protection Agency in August. Continued to analyze and evaluate the affect the CPP will have on the Big Stone coal-fired power plant, the Deer Creek natural gas combined cycle plant, and the impact to South Dakota ratepayers. Consulted with and
    monitored reactions by the South Dakota Department of Natural Resources and the South Dakota Attorney General’s Office. Worked with regional organizations to assess regional impacts that may result from the CPP. AG Marty Jackley led South Dakota in joining 24 other states in a lawsuit challenging the CPP and requested a stay of the rules.
  • Commissioner Kristie Fiegen was a featured speaker at a joint meeting of the South Dakota Association of Cooperatives and the South Dakota Co-op Managers Association where she discussed the EPA’s Clean Power Plan and the major challenges presented to South Dakota as a result of the federal agency’s final rule.

ENERGY EFFICIENCY

  • Approved updates to energy efficiency and conservation programs. In 2015, the estimated energy savings for all IOUs were 13,920 megawatt hours of electricity and 31,014 dekatherms of natural gas.
    • In separate dockets, MidAmerican Energy Co. updated its 2015 and 2016 plan to include rebates for energy-efficient furnaces and ground source heat pumps and revised its 2016 plan to remove clothes washer rebates from the electric residential program.
    • NorthWestern Energy will continue its Efficiency Plus program for the 2015-2016 plan year for electric and natural gas customers that includes residential energy audits and residential and commercial rebates for lighting, insulation and energy-efficient equipment.
    • Xcel Energy added new construction LED lighting rebates for businesses to its 2016 Demand Side Management plan.
    • Otter Tail Power Co. will continue its existing Energy Efficiency Plan in 2016. The company estimates the plan will save 2,808 megawatt hours of electricity in 2016.
    • Black Hills Power made modifications to its Energy Efficiency Solutions Program for 2015-2016 including the addition of residential kits and other efficiencies recommended by PUC staff.
    • Montana-Dakota Utilities Co. added an energy audit program to its Natural Gas Conservation Portfolio beginning in 2016.

GRAIN WAREHOUSE

  • Issued licenses to 177 entities with 322 locations and performed 407 inspections at 269 licensed facilities.

LEGISLATION

  • The legislature passed HB 1037 to clarify the differences between a person who chooses to comment in a rate case and a person who chooses to intervene as a party.
  • Passing through each phase of the legislative process with unanimous support, HB 1038 specified that all electric transmission lines sited by the PUC be subject to a 12-month siting period and clarified the $8,000 minimum filing fee for siting cases is not subject to refund.
  • HB 1039 made changes to grain buyer statutes to clarify voluntary credit sale contracts and allow a parent company to provide its financial statements in support of all subsidiaries seeking to be licensed.

NATURAL GAS

  • Via the acceptance of a settlement agreement offered by company representatives and PUC staff, gave the go-ahead in June for MidAmerican Energy Co. to increase customers’ distribution delivery rates by about 5.67 percent; the company’s request was 10.7 percent. Improvements in pipe, including retiring all vintage cast iron gas pipe systems and replacing older steel and plastic pipes were key factors in the company’s request for additional revenue. Other investment in facilities and equipment, and inflation also played a part.
  • Began processing a request received in July from Montana-Dakota Utilities Co. to increase its natural gas rates by 3.1 percent.

PIPELINE SITING, SAFETY AND INSPECTION

  • Continued processing TransCanada’s certification regarding the company’s ability to comply with the conditions of the original permit issued for the TransCanada Keystone XL Pipeline, which was filed in September 2014. Held a public input session in Pierre in July attended by about 100 people; 52 individuals offered verbal comments. A nine-day formal evidentiary hearing was held in late July/early August in Pierre. The proposed pipeline route in South Dakota has an estimated length of 315 miles that will cross portions of Harding, Butte, Perkins, Meade, Pennington, Haakon, Jones, Lyman and Tripp counties. The project includes seven pump stations to be located in Harding, Meade, Haakon, Jones and Tripp counties. The plans specify two pump stations each in Harding and Tripp counties. The pipeline is proposed to transport crude oil starting in Hardisty, Alberta, Canada, to Steele City, Nebraska.
  • Promoted the Call Before You Dig program with a Governor’s Proclamation and news release for National Safe Digging Month in April. Encouraged visitors to the PUC’s booth at the Sioux Empire and Black Hills home shows and the South Dakota State Fair to take the One Call pledge to call 811 before any excavation activity.
  • Hosted the South Dakota/North Dakota Pipeline Safety Operator Training in Sioux Falls for nearly 150 representatives of the pipeline industry. Participants attended presentations by 19 experts discussing regulations, corrosion risk, distribution integrity management, incident command, emergency drills and accident investigation. The event also included an exhibitor showcase featuring products and services offered by 16 companies.
  • In November, the PUC approved a permit for a 272-mile portion of the Dakota Access Pipeline to be constructed across Campbell, McPherson, Edmunds, Faulk, Spink, Beadle, Kingsbury, Miner, Lake, McCook, Minnehaha, Turner and Lincoln counties and one pump station to be located in Spink County. The docket was filed in December 2014. In January, Commissioner Kristie Fiegen disqualified herself from the docket due to a familial relationship with a landowner along the proposed pipeline route. Gov. Dennis Daugaard appointed State Treasurer Rich Sattgast to serve as acting commissioner for the docket. The PUC held public input hearings in January in Bowdle, Redfield, Iroquois and Sioux Falls collectively attended by more than 580 people. An eight-day evidentiary hearing was held in Pierre in late September/early October.
  • Completed 151 days of pipeline safety inspections.

PUBLIC OUTREACH AND CONSUMER ASSISTANCE

  • Assisted consumers on nearly 2,000 occasions with issues and complaints related to electric, natural gas, telecommunications (including wireless), pipeline siting, energy efficiency and other utility-related topics.
  • Helped to increase the total amount of South Dakota telephone numbers on Do Not Call registry to 644,154.
  • Commissioner Chris Nelson was a guest lecturer for Mickelson Middle School eighth grade science classes in Brookings. Nelson and the students discussed wind, hydro and solar applications in South Dakota.
  • Engaged more than 2,600 consumers in conversations about the purpose and services of the PUC at spring home shows in Sioux Falls and Rapid City and at the South Dakota State Fair.

RENEWABLE ENERGY

  • Approved the construction of the Willow Creek Wind Energy Facility in Butte County by accepting a settlement stipulation offered by the company and PUC staff in November. The 103-megawatt wind farm will include 45 turbines and will interconnect to a 115 kV transmission line owned by Western Area Power Administration. The PUC held a public input hearing in Newell in July at which the developer, Wind Quarry, presented its plans and answered questions from the commission and public.
  • Compiled the annual South Dakota Renewable, Recycled and Conserved Energy Objective report for calendar year 2014 and submitted it to the state legislature. Nearly all utilities are utilizing both renewables and energy efficiency in their resource mixes and expect to be in a position to meet the 10 percent goal for 2015.

TELECOMMUNICATIONS

  • Thirty-seven telecommunications carriers were deemed eligible to collectively receive millions of dollars in high cost support from the federal Universal Service Fund for maintaining, upgrading and building out their voice and broadband networks in South Dakota. The Universal Service Administration Co. estimates South Dakota carriers invested more than $74 million in USF monies in South Dakota in 2014.
  • Encouraged CenturyLink’s decision to partner with the Connect America Fund to expand broadband availability to more than 15,000 customer locations in their territory within the next six years.
  • Commissioner Chris Nelson delivered presentations about telecommunications regulation, opportunities and roadblocks at the Public Utilities Advisory Council’s Current Issues Forum, Oregon Telecommunications Association-Washington Independent Telecommunications Association annual meeting, Critical Consumer Issues Forum, and NTCA-The Rural Broadband Association’s fall conference.

WIRELESS

  • Monitored the actions and results as new wireless telecommunications sites were launched by companies at several locations including in or near Arlington, Armour, Belle Fourche, Belvidere, Box Elder, Bridgewater, Brookings, Chamberlain, Colman, Custer, De Smet, Estelline, Fort Pierre, Hot Springs, Howard, Huron, Kadoka, Kennebec, Keystone, Kimball, Kyle, Madison, Marion, Milbank, Miller, Mission, Montrose, Murdo, Nunda, Oelrichs, Okreek, Parkston, Parmelee, Pierre, Plankinton, Platte, Rapid City, Reliance, Scotland, Sioux Falls, Sisseton, Spencer, Strandburg, Sturgis, Summit, Viborg, Vienna, Vivian, Wall, Wallace, Wanblee, Watertown, Wessington Springs and White River. Companies also made a number of technology enhancements on existing towers throughout the year.

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