SOUTH DAKOTA PUBLIC UTILITIES COMMISSION
2016 Highlights
Leadership
Chairperson Chris Nelson
Vice Chairperson Kristie Fiegen
Commissioner Gary Hanson
Electric
Energy Efficiency
Grain Warehouse
Natural Gas
Pipeline Siting, Safety and Inspection
Public Outreach and Consumer Assistance
Renewable Energy
Telecommunications
Wireless
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The PUC received affirmation in January from the South Dakota 6th Circuit Court of the commission’s decision in 2015 to allow Black Hills Power to increase electric rates. The appeal had been brought by the Black Hills Industrial Intervenors, a group that included GCC Dakotah, Pete Lien & Sons, Rushmore Forest Products, Spearfish Forest Products, Rapid City Regional Hospital and Wharf Resources.
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In December, the South Dakota Supreme Court unanimously upheld the commission’s 2015 decision to allow Black Hills Power to raise electric rates. The Black Hills Industrial Intervenors sought the appeal before the high court after the 6th Circuit Court upheld the commission’s decision in January. (See previous entry).
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In February, the U.S. Supreme Court stayed implementation of the Clean Power Plan pending judicial review. (In 2015, the South Dakota Attorney General joined 24 states in the request of a stay of the rules.)
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In May, the commission adopted final rules (ARSD 20:10:39:01 to 20:10:39:60, inclusive) that set forth specific measurement, testing and remediation procedures that an electric utility must follow when the utility tests a dairy for stray voltage or current.
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Approved an update to Black Hills Energy’s environmental improvement adjustment in May to allow costs associated with two previously approved projects plus four new projects: a compressed air system upgrade at the Gillette Energy Complex; an electrostatic precipitator upgrade at Neil Simpson II; and amended silicates silos at the Neil Simpson II and Wygen III power plants. The average bill impact for a typical residential customer using 650 kWh per month is $0.05.
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In June, the commission approved a settlement agreement allowing Montana-Dakota Utilities Co. to generate an additional $1.4 million in annual revenues, nearly half of what the company requested. The rate increase would result in a typical residential electric customer seeing an average monthly increase of approximately $8.40. The request was the first base electric rate increase to be implemented by Montana-Dakota since 1986. The company cited investments related to federal regulations, additional generation resources and transmission as the need to raise rates.
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The commission processed a number of transmission cost recovery tariff requests with these results:
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In February, an update to Otter Tail Power Company’s TCR rider rate was approved. The updated rate reflects the 2016 recovery period that included seven previously-approved projects, transmission service costs for the Midcontinent Independent System Operator and the Southwest Power Pool and revenue from the use of the company’s facilities in the MISO market. The revenue requirement approved for the company for this filing was $1.9 million.
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In April, the commission approved an update to MidAmerican Energy Company’s TCR rider rate that covers allowed costs related to the Midcontinent Independent System Operator’s Federal Energy Regulatory Commission Transmission Rate Schedules 10, 26, and 26-A. The $305,000 approved revenue requirement translates roughly to a $0.53 monthly increase on an average residential customer’s bill.
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In December, approved Xcel Energy’s request for an update to its TCR rate to allow recovery in 2017 of $7.65 million related to 16 previously approved transmission projects, transmission service costs for the Midcontinent Independent System Operator, and revenue from the use of the company’s facilities in the MISO market. An average residential customer using 750 kWh per month will see a monthly increase on their bill of $0.70.
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In May, approved an update to Black Hills Energy’s Transmission Facilities Adjustment, which included one previously approved project. A typical residential customer using 650 kWh per month and saw a $0.03 monthly increase on their bill.
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- Commissioners and staff attended an implosive connector demonstration performed by Xcel Energy along the CapX2020 Big Stone South-Brookings County transmission line project near Clear Lake in July.
- Commissioner Chris Nelson spoke at the construction kickoff event for the Big Stone South-Ellendale 345-kilovolt transmission line project near Webster in September. Project owners Otter Tail Power Co. and Montana-Dakota Utilities Co. expect construction of the 163-mile line to be completed in late 2018.
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In November, the commission approved a reduction 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. The reduction was primarily due to bonus federal tax depreciation. The bill decrease for a typical residential customer averaging 955 kWh per month will be approximately $1.02.
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Approved an update to Xcel Energy’s infrastructure rider factor in December. The change would add an approximate $0.40 to an average residential customer’s monthly bill and allow Xcel Energy to recover the cost of 44 previously approved projects plus seven new ones.
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Commissioner Gary Hanson shared his expertise as a speaker and panelist at events including the Public Utilities Advisory Council’s Current Issues Forum, where he focused on compliance with the EPA’s Clean Air Act, and at Macquarie’s annual Utilities, Power and Energy Infrastructure Dialogue, where emerging trends, regulation and industry structure were discussed.
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Commissioner Kristie Fiegen was named secretary of the Southwest Power Pool Regional State Committee. As a committee member, Fiegen participated in numerous meetings to provide 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. PUC staff members participated in the Cost Allocation Working Group that reports to the RSC. SPP held its summer board meeting in Rapid City.
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Commissioners and staff participated in discussions with stakeholders about the newly formed Mountain West Transmission Group, an informal collaborative of electric service providers from Arizona, Colorado, Kansas, Montana, New Mexico, Oklahoma, South Dakota, Utah and Wyoming. The group is exploring the benefits of implementing a common transmission tariff across multiple states and developing an organized market.
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Approved updates to energy efficiency and conservation programs. In 2016, the estimated energy savings for all investor-owned utilities were 17,217 megawatt hours of electricity and 45,675 dekatherms of natural gas.
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Xcel Energy will continue offering a Demand Side Management plan in 2017. Ground source heat pump rebates are excluded from the 2017 plan, which was removed at the commission’s request due to those rebates not proving to be cost effective.
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Otter Tail Power Co. will update its plan with the addition of a pilot program to distribute LED light bulbs to students that participate in energy conservation education programs. The company estimates its overall plan will save 3,804 megawatt hours of electricity in 2017.
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MidAmerican Energy Co. will continue offering its existing energy efficiency plan in 2017.
- Issued licenses to 173 entities with 329 locations and performed 413 inspections at 274 licensed facilities.
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The commission accepted a joint settlement agreement in June from Montana-Dakota Utilities Co., the PUC staff and the Federal Executive Agencies, an intervenor representing the interests of Ellsworth Air Force Base, which enabled Montana-Dakota to increase its natural gas rates. The rate increase request was made to raise additional annual revenue of $1.5 million; the PUC agreed to allow $1.2 million in additional annual revenue. Typical residential natural gas customers using 72 dekatherms on an annual basis would see an average monthly increase of approximately $1.49.
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The commission accepted a settlement agreement in November offered by Montana-Dakota Utilities, South Dakota Intrastate Pipeline Co., and the PUC staff regarding Montana-Dakota’s complaint against SDIP’s rates for pipeline transportation service. In part, the settlement outlines SDIP’s agreement to file a rate case with the PUC at a later date.
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In November, PUC staff requested the commission issue a declaratory ruling to determine several issues related to farm taps owned and operated by Northern Natural Gas with billing and emergency services provided by NorthWestern Energy and to determine the state’s jurisdiction over farm taps for the purpose of pipeline safety. A ruling is expected in 2017.
PIPELINE SITING, SAFETY AND INSPECTION
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In January, the commission determined that the certification by TransCanada Keystone Pipeline to construct the Keystone XL Pipeline in South Dakota was valid. The decision came after a year-long process regarding TransCanada’s ability to comply with the conditions of the original permit issued for the TransCanada Keystone XL Pipeline. The 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.
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In February, the commission received notice that seven parties filed separately in the South Dakota 6th Circuit Court to appeal the commission’s decision to accept as valid the certification by TransCanada Keystone Pipeline to construct the Keystone XL Pipeline in South Dakota. Appeals filed by the Yankton Sioux Tribe, Intertribal Council on Utility Policy, Cheyenne River Sioux Tribe, Cindy Meyers, and a group of 11 people collectively referred to as Landowners were merged into the appeal filed by Dakota Rural Action. The appeal filed by Rosebud Sioux Tribe did not progress. A decision by the circuit court is expected in 2017.
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The commission received notice in January that its decision to approve, with conditions, a siting permit for the Dakota Access Pipeline project was being appealed to the South Dakota 6th Circuit Court by the Yankton Sioux Tribe. The PUC joined Dakota Access’ motion to dismiss the appeal. In April, Judge Mark Barnett granted the motion to dismiss.
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Monitored Dakota Access’ compliance with the permit issued by the commission in 2015 to construct the Dakota Access Pipeline in South Dakota. Commission staff had regular communication with the third-party compliance monitor, including weekly reports during the construction as well as on-site visits. The majority of pipeline construction in South Dakota was completed during 2016. Restoration activities will be completed and monitored in 2017.
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Promoted the Call Before You Dig program with a 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.
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Completed 147 days of pipeline safety inspections.
PUBLIC OUTREACH AND CONSUMER ASSISTANCE
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Engaged more than 3,380 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.
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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 energy applications in South Dakota.
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In November, Commissioner Chris Nelson was elected statewide to serve a second term on the PUC.
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Assisted consumers on nearly 1,600 occasions with issues and complaints related to electric, natural gas, telecommunications (including wireless), pipeline siting, energy efficiency and other utility-related topics.
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Helped to increase the total amount of South Dakota telephone numbers on Do Not Call registry to 654,058.
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The commission received a permit application in June for Prevailing Winds, a proposed 201-megawatt wind energy facility in Bon Homme and Charles Mix counties. A four-hour public input hearing was held in Avon in August, attended by more than 300 people. Prevailing Winds withdrew their application the same month.
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Commissioners attended a dedication ceremony in September for the Pierre Solar Project, a one-megawatt solar photovoltaic facility – the largest in South Dakota – operated jointly by the City of Pierre, Geronimo Energy and Missouri River Energy Services.
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Compiled the annual South Dakota Renewable, Recycled and Conserved Energy Objective report for calendar year 2015 and submitted it to the state legislature. Seven of the 12 utilities required to report are utilizing both renewables and energy efficiency in their resource mixes and met the 10 percent goal for 2015.
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Thirty-four 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 nearly $88 million in USF monies in South Dakota in 2015.
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As chairman of the National Association of Regulatory Commissioners’ Telecommunications Committee, Commissioner Chris Nelson was invited to address national audiences at several trade industry events, including the Internet & Television Expo and the summer and annual NARUC meetings.
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Commissioners and staff joined members of the South Dakota Telecommunications Association for the biannual SDTA-PUC Forum in December. Among the educational sessions offered were presentations about internet protocol transition, rural carriers, public safety broadband network and competitive overlap.
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Monitored the actions and results as new wireless telecommunications sites were launched by companies at several locations including in or near Aberdeen, Artesian, Batesland, Black Hawk, Custer, Deadwood, Hermosa, Hill City, Lake Andes, Lake Preston, Lead, Mitchell, New Underwood, Piedmont, Pine Ridge, Rapid City and Revillo. Wireless companies also made numerous network enhancements throughout the state.
