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South Dakota Public Utilities Commission Meeting
Tuesday, December 18, 2007, at 8:30 A.M.
State Capitol Building, Room 412
Pierre, South Dakota
MINUTES OF THE COMMISSION MEETING
Chairman Dustin Johnson called the meeting to order. Present were: Vice Chairman Gary Hanson; Commissioner Steve Kolbeck; Executive Director Patty Van Gerpen; Deputy Executive Director Heather Forney; Commission Advisor Greg Rislov; Commission Attorneys John Smith and Rolayne Wiest; Staff Attorneys Karen Cremer and Kara Semmler; Staff Analysts Harlan Best, Dave Jacobson, Nathan Solem, Bob Knadle, Keith Senger, and Brian Rounds; Consumer Affairs Supervisor Deb Gregg; and Administrative Secretary Demaris Axthelm.
Also present were: Dave Gerdes, May, Adam, Gerdes and Thompson, representing MidContinent Communications; Jim Wilcox, Xcel Energy; Meredith Moore, Cutler and Donahoe, representing Reduced Rate Long Distance; Pam Bonrud, Jeff Decker, Kendall Kliewer, and Kristi Wallman, NorthWestern Energy; Brett Koenecke, May, Adam, Gerdes and Thompson, representing NorthWestern Energy; and Rich Coit, South Dakota Telecommunications Association.
Joining the meeting by telephone were: Dawn Glover, City of Elk Point; Dave Ross, Otter Tail Power Company; Thomas Yohn, Xcel Energy; Kenna Hagan, Black Hills Power Inc.; Suzan Stewart, MidAmerican Energy Company; Dehn Stevens, MidAmerican Energy Company; Tom Basso, National Renewable Energy; Brad Klein, Environmental Law and Policy Center; Tami Aberle, Montana-Dakota Utilities; Bob Towers and Basil Copeland, Chesapeake Regulatory Consultants; Ron Blum, Montana-Dakota Utilities Co.; Roger Lorenzen, and Robert Jared, MidAmerican Energy Company; Adam Solomon, representing Reduced Rate Long Distance; Kathy Ford, PrairieWave Black Hills, LLC and PrairieWave Telecommunications Inc; and Andy Wenbourne, Union County.
1.) Status Report on Consumer Utility Inquiries and Complaints Received by the Commission. (Consumer Affairs: Deb Gregg)
Ms. Deb Gregg reported that the Commission had received a total of 151 contacts since the last report was prepared for the November 20, 2007 Commission meeting. 22 contacts involved telecommunications services; 31 contacts involved electricity issues; 9 contacts involved natural gas issues; 1 contact involved electrical and natural gas services, 20 contacts involved cellular phone issues; 37 contacts involved the Do Not Call Registry; and 31 contacts involved issues not regulated by the Public Utilities Commission. In 2007, 2,101 of the 2,264 complaints registered have been resolved informally. In 2006, 2,355 of the 2,466 complaints registered have been resolved informally.
1. In the Matter of the Approval of Tariff Revisions and/or Interconnection Guidelines in Dockets EL07-027, EL07-028, EL07-029, EL07-030, EL07-031, and EL07-032.
EL07-027- In the Matter of the Filing by Xcel Energy for Approval of its Tariff Revisions and Distributed Generation Interconnection Manual. (Staff Analyst: Nathan Solem, Staff Attorney: Kara Semmler)
EL07-029 - In the Matter of the Filing by Black Hills Power, Inc. for Approval of Tariff Revisions and Technical Requirements for Parallel Operation of Distribution Generation Facilities. (Staff Analyst: Nathan Solem, Staff Attorney: Kara Semmler)
EL07-030 - In the Matter of the Filing by Montana-Dakota Utilities Co. for Approval of its Tariff Revisions and Guidelines for Interconnection Requirements and Parallel Operation of Customer Owned Generation. (Staff Analyst: Nathan Solem, Staff Attorney: Kara Semmler)
EL07-031 - In the Matter of the Filing by Otter Tail Power Company for Approval of its Tariff Revisions and Distributed Generation Interconnection Manual. (Staff Analyst: Nathan Solem, Staff Attorney: Kara Semmler)
EL07-032 - In the Matter of the Filing by NorthWestern Energy for Approval of its Tariff Revisions and Distributed Generation Interconnection Manual. (Staff Analyst: Nathan Solem, Staff Attorney: Kara Semmler)
Mr. Nathan Solem stated that Staff had conducted a high level review of the interconnection filings and had found the following key issues that may warrant further discussions in the development of a statewide best practices model workshop. Mr. Solem stated that the issues were liability insurance provisions, tiered framework including fast track for review of different classes of distributed generators, the extent of utility specific technical requirements versus adoption of IEEE 1547 and UL 1741 standards, wide variance in the technical interconnection guidelines, wide variance in the procedures and volume of documents for distributed generators to review. Mr. Solem recommended approval of the filings on an interim basis only, until the four workshops and rulemaking process yields draft best practice rules for the Commission's consideration. Mr. Solem stated that because of the Commission's order of a development of the best practice rules in a workshop setting, staff felt that the differences would be best resolved in a workshop setting and in the meantime, there would be interim approved filings for distributed generators to review. Mr. Brad Klein had no further comments to add and stated that he would provide resources in the upcoming workshops. Mr. Tom Basso agreed that this would be the best approach to arrive at state rules. Ms. Suzan Stewart noted that MidAmerican Energy's procedures are based on the FERC small generators interconnection procedures.
Discussion and comments on the motion: Chairman Johnson noted that not only do we need best practices, but also greater uniformity and greater standardization of the process and requirements. Mr. Solem noted that staff is scheduling four workshops with three professional facilitators; two workshops would be in person and two teleconference workshops that will be completed within nine months to one year from now. Mr. Solem further stated that at this time they would have draft rules for the rule making process. Mr. Solem stated that the best practice rules would start with the Oregon rules and would be adjusted to fit the needs for the state of South Dakota. Ms. Rolayne Wiest agreed that action should be deferred.
Chairman Johnson moved to defer the tariff revisions and the interconnection requirements in each of the following Dockets: EL07-027, EL07-028, EL07-029, EL07-030, EL07-031 and EL07-032. Motion passed 3-0.
2. EL07-034 - In the Matter of the Filing by the City of Elk Point for Approval of its Revised Service Territory as a Result of Annexation. (Staff Analyst: Dave Jacobson, Staff Attorney: Karen Cremer)
Ms. Dawn Glover, City Administrator for the City of Elk Point (City) stated that Kum n Go Business had petitioned the city of Elk Point to be annexed into its territory and at that time the City asked the business if it also wanted municipal electricity. Mr. Andy Wenbourne, Union County Electric Cooperative stated that it has been providing temporary service to the business and if the Commission approves the revised service territory as a result of the annexation, that Union County is ready and willing to turn over the service territory to the City. Mr. Dave Jacobson stated that all rules and statues have been addressed and recommended approval of the revised service territory.
Vice Chairman Hanson moved to approve the revised service territory as a result of annexation in Docket EL07-034. Motion passed 3-0.
Gas & Electric
1. GE06-001 - In the Matter of the Merger between NorthWestern Corporation and BBI Glacier Corp., a Subsidiary of Babcock & Brown Infrastructure Limited (Staff Analysts: Dave Jacobson/Bob Knadle, Staff Attorney: John Smith)
Mr. Dave Gerdes, representing NorthWestern Corporation (NorthWestern) stated that the termination of the proposed merger between BBI Glacier Corp (BBI) and NorthWestern constitutes a material change in circumstances under the FERC agreement and therefore NorthWestern asked that the Commission issue an order terminating the FERC agreement. Mr. John Smith agreed that termination of the merger by BBI constitutes a material change in circumstances under the FERC Settlement Agreement and that since the fundamental premise underlying the agreement will not occur, the agreement should be terminated. Mr. Smith however questioned whether the Commission has jurisdiction to issue an order since the Commission had determined it had no jurisdiction over the transaction. Mr. Smith recommended that the Commission, either in lieu of or in addition to an order, authorize the termination of the agreement by mutual consent in the FERC proceeding and authorize the Executive Director and General Counsel to execute any documents necessary to memorialize the termination.
Chairman Johnson moved to authorize a mutual termination of the settlement agreement and to authorize the Executive Director and General Counsel to execute any necessary documents to memorialize the termination. Motion passed 3-0.
1. NG07-013 - In the Matter of the Application by NorthWestern Corporation d/b/a NorthWestern Energy for Authority to Increase its Natural Gas Rates. (Staff Analysts: Dave Jacobson/Keith Senger/Bob Knadle/Nathan Solem/Steve Wegman, Staff Attorney: Karen Cremer)
Mr. Brett Koenecke stated that NorthWestern Energy (NorthWestern) has reached a settlement agreement with Staff and had no further comments. Mr. Kendall Kliewer stated that a very fair settlement agreement for customers had been reached with Staff. Ms. Karen Cremer stated that Staff recommends approval of the joint motion for the settlement stipulation. Mr. Keith Senger summarized several different highlights involving the NorthWestern rate case.
Chairman Johnson moved to grant the joint motion for approval of the settlement stipulation. Motion passed 3-0.
Mr. Ron Bloom stated that Montana-Dakota Utilities Co. (MDU) is requesting a specific waiver of Part 192.481(a) to allow atmospheric corrosion inspection frequency at least once every 4 calendar years, but with intervals not to exceed 51 months. Mr. Bloom stated that this has been approved in other states and MDU has accepted staff's recommendations. Mr. Nathan Solem recommended that the Commission approve the waiver. Ms. Tami Aberle stated that she would get back to Vice Chairman Hanson on the cost of atmospheric corrosion inspection testing.
Chairman Johnson moved to defer action in Docket PS07-001 until additional information is submitted by MDU. Motion passed 3-0.
2. PS07-003 - In the Matter of the Filing by MidAmerican Energy Company for Approval of a Waiver of 49 C.F.R. Section 192.285(a)(2) and 49 C.F.R. Section 192.285(c). (Staff Analyst: Nathan Solem, Staff Attorney: Kara Semmler)
Mr. Roger Lorenzen explained MidAmerican Energy Company's (MidAmerican) reasons for requesting the waiver. Mr. Lorenzen stated that this would allow MidAmerican to re-qualify its employees on a schedule that would use the off season time of MidAmerican. Mr. Nathan Solem stated that Martin Bettmann had submitted a recommendation stating that the proposed waiver is not inconsistent with pipeline safety and that similar waivers have been approved in adjacent states. Mr. Solem recommended that the waiver be approved, that MidAmerican be required to follow the alternative qualification procedures and standards set forth in paragraph 4 of the Request for Waiver and that the order approving the waiver be forwarded to the USDOT's Office of Pipeline Safety.
Vice Chairman Hanson moved to approve the waiver, to require MidAmerican to follow the alternative qualification procedures and standards set forth in paragraph 4 of the Request for Waiver and forward the order approving the waiver to the USDOT's Office of Pipeline Safety. Motion passed 3-0.
1. In the Matter of the Failure of Certain Telecommunications Companies to Timely File the Gross Receipts Tax (Deputy Executive Director: Heather K. Forney)
Ms. Heather Forney stated that of the ten companies included on the agenda for failure to file a report or pay the gross receipts tax, four have now come into compliance and six remain in non-compliance. Ms. Forney recommended that an order to show cause be issued to each of the six companies remaining in non-compliance as to why the company should not be fined or have its certificate of authority suspended or revoked. The six companies remaining in non-compliance are:
Filed, but not paid:
Intandem Communications Corp
Touch 1 Communications, Inc.
Neither filed nor paid:
DelTel, Inc. d/b/a AuctionFON
Network Communications International Corporation
Preferred Carrier Services, Inc.
Chairman Johnson moved to issue an order to show cause as to why the Commission should not fine, or suspend or revoke the certificate of authority of, each of the six non-compliant companies for failure to pay the requisite gross receipts tax. Motion passed 3-0.
1. Election of a Chairperson and Vice-Chairperson of the Commission. (General Counsel: John Smith.)
Chairman Johnson nominated Vice Chairman Hanson as Chairman with an effective date of December 19, 2007. Motion passed 3-0.
Commissioner Kolbeck nominated Chairman Johnson as Vice Chairman with an effective date of December 19, 2007. Motion passed 3-0.
ADDENDUM TO THE
AGENDA OF COMMISSION MEETING
Mr. Nathan Solem stated that Staff is recommending a workshop format that would be facilitated by three skilled professionals for development of a best practices interconnection model. Two of the three proposed facilitators, Mr. Tom Basso or Mr. Mike Coddington from National Renewable Energy Laboratory (NREL) and Mr. Brad Klein from Environmental Law and Policy Center, who are self funded, and the third facilitator is Wayne Shirley, from Regulatory Assistance Projects, who requires a contract to cover consulting time and expenses. Mr. Shirley's expertise is interconnections procedures and processes and facilitating the negotiating process on such issues. Mr. Solem also stated that the facilitators would cover two in-person two day workshops and two teleconferencing workshops and a total of 23 consulting days. Mr. Solem noted that states that have not proceeded with skilled facilitators may have taken longer than optimum to complete the workshop process.
Commissioner Kolbeck moved to authorize the Executive Director to hire and enter into contracts with the Consultants. Motion passed 3-0.
Gas & Electric
1. GE06-001 - In the Matter of the Merger between NorthWestern Corporation and BBI Glacier Corp., a Subsidiary of Babcock & Brown Infrastructure Limited (Staff Analysts: Dave Jacobson/Bob Knadle, Staff Attorney: Kara Semmler John Smith)
Docket GE06-001 of the Addendum to the Agenda was taken up in the Agenda.
1. TC07-107 - In the Matter of Unauthorized Long Distance Changes and Unauthorized Telephone Charges Made by Reduced Rates Long Distance. (Staff Analysts: Brian Rounds/Keith Senger/Deb Gregg, Staff Attorney: Kara Semmler)
Mr. Dave Gerdes stated that Midcontinent Communications (Midcontinent) has been the victim of the matter in Docket TC07-107 and asked that the Commission grant the petition for intervention.
Vice Chairman Hanson moved to grant intervention to Midcontinent Communications in Docket TC07-107. Motion passed 3-0.
Ms. Kara Semmler summarized Staff's Motion for an order to show cause and explained that the order was filed after receiving 22 complaints. Ms. Semmler further stated that Reduced Rate Long Distance (Reduced Rate) continues to deny the facts. Ms. Meredith Moore stated that Reduced Rate has investigated the alleged complaints and has canceled any services and all collection attempts with the consumers involved. Ms. Moore further stated that Reduced Rate is in no way downplaying any of the complaints that have been filed since the filing of the order to show cause. Ms. Kathy Ford stated that PrairieWave has taken complaints from PrairieWave customers as late as the end of July 2007, against Reduced Rate.
Vice Chairman Hanson moved to grant the motion to show cause in Docket TC07-107. Motion passed 3-0.
2. TC07-108 - In the Matter of the Filing by XO Communications Services, Inc. for an Extension of an Exemption from Developing Company Specific Cost-Based Switched Access Rates. (Staff Analyst: Keith Senger, Staff Attorney: Karen Cremer)
Mr. Keith Senger stated that previously the Commission issued an order granting XO Communications Services, Inc. (XO) a three year exemption from developing company specific cost based intrastate switched access rates and allowed them to mirror Qwest rates. Mr. Senger said that in this filing XO is requesting an extension of that exemption because the three year term has expired. Staff recommends that the Commission grant XO's request for that extension and allow them to continue to use the Qwest rates and recommends that the extension have no time limit and that XO be allowed to file adjustments to its intrastate switched access tariff and rates so long as those rate adjustments either mirror or are lower than Qwest rates.
Commissioner Kolbeck moved to grant the request for an extension of an exemption from developing company specific cost based switched access rates and allow XO Communications to modify its switched access tariff so long as XO Communications' intrastate switched access rate is equal to or less than that of the ILEC Qwest intrastate switched access rate or until the Commission shall otherwise order. Motion passed 3-0.
There being no further business, at the hour of 11:07 am the South Dakota Public Utilities Commission Meeting adjourned.
_/s/_ Demaris Axthelm____