SOUTH DAKOTA PUBLIC UTILITIES COMMISSION
2010 HIGHLIGHTS
2010 Leadership: Dusty Johnson, Chairman; Steve Kolbeck, Vice Chairman;
Gary Hanson, Commissioner
2011 Leadership: Steve Kolbeck, Chairman; Gary Hanson, Vice Chairman;
Chris Nelson, Commissioner
Broadband
Electric
Energy Efficiency
Grain Warehouse
New Legislation
Leadership
Public Outreach and Consumer Assistance
Pipeline Siting and Inspection
Renewable Energy
Telecommunications
Wireless
- Public Utilities Commissioners Johnson, Kolbeck and Hanson and Gov. Mike Rounds met with members of the Federal Communications Commission in Washington, D.C., to discuss the proposed National Broadband Plan. The group stressed the need for the FCC to fully understand the effect the plan, in its current state, could have on South Dakota. Key points of the discussion focused on ensuring any changes to the current funding structure for small rural carriers will enable the carriers to continue to build on their successes and emphasizing the advantages of working with state commissions to ensure unserved and underserved areas receive access to broadband services.
- Commissioners participated as members of the Broadband Advisory Team that oversees the statewide broadband mapping project.
- Approved PrairieWinds SD 1, the state's second-largest wind farm. The 162-megawatt wind farm will spread over parts of Jerauld, Aurora and Brule counties. Developer Basin Electric Power Cooperative is constructing 108 wind turbines and a 13-mile, 230 kilovolt transmission line and other associated facilities.
- Compiled the annual South Dakota Renewable, Recycled and Conserved Energy Objective report and submitted it to the state legislature. Companies reporting for 2009 collectively owned 507 megawatts of renewable generation capacity in South Dakota; retired 7,570 megawatt hours of renewable energy credits; and reported 8,014 MWh in conserved energy and 100 MW of conserved capacity, all in South Dakota.
- Hosted Energy Briefings for legislators in Rapid City, Sioux Falls, Watertown and Pierre. The forums featured an update about wind energy development in South Dakota, discussion about energy policy issues and the opportunity for legislators to ask pre-session questions.
- Shepherded the passage of Senate Bill 58 that revised existing statute to make the first $50,000 of the assessed value of a small to medium renewable energy property, or 70 percent of the assessed value if that figure is greater, exempt from real property tax. The bill repealed 13 sections of the state tax code related to property tax reductions for small renewable systems.
- Drafted new legislation, Senate Bill 61, that requires electric utilities to file with the PUC their minimum rates for the purchase of electricity generated from renewable resources and produced by a facility that has a capacity of 100 kilowatts or less. Posted the rates on the PUC Web site, www.puc.sd.gov, to allow the producer to easily review and compare rates to make an informed decision regarding the economics of a small renewable power facility.
- Continued the advancement of the PUC Wireless Initiative by coordinating with wireless telecommunications providers and community leaders for the construction of 15 new wireless sites in and around Beresford, Bristol, Elk Point, Elkton, Hoven, Hurley, Lake Preston, Ludlow, Okreek, Revillo, Rockerville, Sioux Falls and Veblen.
- Monitored the transition between Alltel Wireless and AT&T. Held numerous discussions with AT&T officials throughout the process to advocate on behalf of South Dakota customers. Assisted dozens of consumers with questions related to the differing technologies the companies use, the dates of transition of service and selection of new wireless devices.
- Completed an extensive rate case process resulting a 12.7 percent increase in electric rates for retail customers of Black Hills Power. The increase represents about $17 million less in annual revenues than the company requested. The company asked for a permanent increase of 26.6 percent. A PUC staff team of one attorney and five analysts logged more than 2,600 hours reviewing documents, requesting additional information, conducting meetings and analyzing data prior to the commission's decision. The staff team was assisted by two specialized consulting firms. The analysis included a review of Black Hills Power's integrated resource plan, submitted separately from the company's rate increase application. The plan described the company's course for meeting the future electricity demands of its customers and the resources it intends to use. The Black Hills Power rate case generated considerable public attention. The PUC held four public input meetings at which the commissioners listened to ratepayer concerns and addressed questions about the PUC's authority and the rate case process. Additionally, more than 200 written and verbal comments regarding the case were submitted to the PUC office.
- Approved the 300-megawatt Deer Creek Station power plant near White. Built by Basin Electric Power Cooperative, the plant will use natural gas combined-cycle technology to generate power to serve its member load requirements. Plant construction is expected to cost $400 million; 30 full-time jobs are to be created by the plant.
- Conditionally approved an approximate 5.5 percent increase over current rates for Xcel Energy, the first base rate increase for the company in 17 years. Xcel requested a 10.7 percent rate increase to current rates. PUC staff and Xcel Energy had previously reached a settlement stipulation for a slightly higher increase, but commissioners unanimously voted to remove costs related to a development fund mandated by the Minnesota Legislature that had been a part of the recommended rate increase.
- Hired three staff members with federal funding provided by the American Recovery and Reinvestment Act. The two utility analysts and one attorney complete assignments related to electric issues only, such as rate cases, transmission siting cases and regional transmission projects. The ARRA-funded staff has a three-year employment commitment.
- Commissioners and staff continued active participation in several transmission cost allocation planning groups including:
- Organization of MISO States' Cost Allocation and Regional Planning workgroup – Had a key role in developing methodology that was approved by the Federal Energy Regulatory Commission methodology that was approved by the Federal Energy Regulatory Commission for transmission projects that have a regional impact and are part of a regional plan to have a 100 percent regional allocation of costs.
- Upper Midwest Transmission Development Initiative – Identified six renewable energy transmission corridors aimed at connecting more than 15,000 MW of wind development in the region (South Dakota, North Dakota, Iowa, Minnesota and Wisconsin). If built, the corridors would provide for reliability and transmission congestion relief in addition to renewable energy benefits. The group's proactive approach provided a favorable position for future transmission projects with relation to the cost allocation methodology approved by FERC.
- Eastern Interconnect States' Planning Council – Continued working with counterparts from 40 states to strategize regional planning and cost allocation efforts.
- Deemed 42 telecommunications companies as eligible to collectively receive millions of dollars in high cost support from the federal Universal Service Fund for maintaining, upgrading and building out their networks in South Dakota in 2011. The Universal Service Administration Company estimates companies invested more than $97 million in USF monies for high cost support in South Dakota in 2009.
- Obtained and commenced execution on a default judgment in the amount of $860,760 against S&S Communications and Les Sumption for customer losses related to S&S's insolvency and cessation of operations. The commission previously obtained $550,000 in customer loss offsets in the form of cash from bonds and other security required of S&S by the commission and loan and lease forgivenesses from three lending institutions that had loaned money against pre-paid service contracts. Since 2003, the PUC's aggressive action in this case on behalf of consumers has included pursuing bond payments, negotiating loan forgiveness, imposing fines on S&S Communications, prohibiting the company from offering prepaid services, and revoking their certificate of authority.
- Approved updated energy efficiency plans by investor-owned utilities that offer cost and energy savings to customers:
- MidAmerican Energy Co. – Programs for electric and natural gas customers are proposed to save more than 836,000 kilowatt hours and 267,000 therms in 2010 alone.
- Montana-Dakota Utilities Co. – Natural gas customers participating in the programs are expected to collectively save more than 197,000 therms.
- Otter Tail Power Co. – The updated plan reflects an 80 percent increase in savings compared to the previous plan and is expected to save more than 2.1 million kilowatt hours by 2011.
- Motivated 2,460 South Dakotans to pledge to become more energy efficient by using compact fluorescent lights, weatherizing their homes and performing regular maintenance on heating and cooling systems. In total, the pledgers' efforts will save $1.13 million, 9.4 million kilowatt hours and more than 10 billion Btus.
- Commissioners and staff participated in an energy-efficiency work project at the home of Kevin and Kelly Nelson in Brookings. The Nelsons represented South Dakota in the 30-60-90 Day Challenge, a national contest to determine which participant conserved the most energy during a three-month period. The work team swapped high-energy-use incandescent light bulbs with energy-efficient compact fluorescent lights, insulated the water heater, added caulk around windows and installed a barrier around a leaking window.
- Participated in the South Dakota Energy Codes Workgroup formed by Gov. Rounds. The workgroup developed recommendations and a compliance plan to satisfy a federal requirement that buildings in South Dakota meet certain commercial and residential energy codes within eight years.
- Hosted two utility energy efficiency workshops with full participation from investor-owned utilities.
- Issued more than 300 licenses and performed 340 inspections at licensed locations.
- Renegotiated contracts for PUC inspectors to perform check-off audits on behalf of various grain councils and commissions.
- Began using Examhand, a software and audit tool specifically designed for inspections of grain handling facilities. The software enhances proficiency and accuracy of audits performed by staff and assists in converting bushels to dollars to better determine the working capital position of the licensee on the day of the inspection.
- Welcomed home staff member and South Dakota National Guard soldier Justin Blais, who safely returned to the state after serving a year in Kuwait with the 1st Battalion of the 147th Field Artillery out of Watertown.
- Continued monitoring activities related to VeraSun's bankruptcy. Disseminated information via the PUC Web site about demand for repayment of a bankruptcy preference from VeraSun's organized debtors.
- Commissioner Steve Kolbeck was named president of the Mid-America Regulatory Conference, an organization comprised of regulatory utility commissioners from a 15-state region.
- In November, Commissioner Steve Kolbeck was voted by his fellow commissioners to serve as commission chairman. Commissioner Gary Hanson was elected vice chairman.
- In December, Gov.-Elect Dennis Daugaard announced the upcoming appointment of Chris Nelson to the PUC. Nelson's appointment fills an expected vacancy on the commission when Commissioner Dusty Johnson announced he would accept a position as Gov.-Elect Daugaard's chief of staff and not serve a second term on the commission.
- Continued monitoring the construction of the Keystone Pipeline in eastern South Dakota, including regular contacts with landowners, local government officials and company representatives to address concerns as well as compliance with the commission's construction order. The pipeline was fully operational in June.
- Granted a permit, with 50 conditions, for the construction of the Keystone XL Pipeline in western South Dakota. Among the conditions with which Keystone must comply are filing an emergency response plan and an integrity management program with the commission prior to putting the pipeline into operation; making repair, replacement or compensation to landowners for property damage or loss; filing a $15.6 million bond with the commission in 2010 and a second $15.6 million bond in 2011 to ensure road damage beyond normal wear and tear that occurs during construction of the pipeline is repaired; performing reclamation and maintenance of the right-of-way throughout the life of the pipeline; appointing an independent public liaison officer, to be approved by the commission, to work with landowners and the PUC to resolve complaints and share information. The PUC further assisted landowners and others with questions about the proposed pipeline, before and after the commission's decision.
- No reportable pipeline safety incidents occurred on jurisdictional pipelines in the state. Reportable incidents include, but are not limited to, events involving a release of gas from a pipeline where death, injury or $50,000 or more of property damage occurs. Jurisdictional pipelines typically start at the gas connection to a town and end at the outlet of each individual house meter.
- Participated in a public awareness effort in concert with South Dakota One Call to promote safe digging. Media announcements, consumer education and outreach activities were tools used to remind South Dakotans to call 811 before digging to preserve personal safety and underground utilities.
- Assisted consumers on more than 2,800 occasions with issues and complaints related to electric, natural gas, telecommunications (including wireless), energy efficiency and other utility-related topics.
- Conducted personal consumer outreach at home shows in Sioux Falls and Rapid City; and fairs in Aberdeen, Sioux Falls and Huron. Commissioners and staff met with nearly 4,000 consumers to answer questions about utility issues and promote energy efficiency, Lifeline and Link-Up telephone assistance programs and the Do Not Call Registry.
- Affected a 5 percent increase in the amount of South Dakota telephone numbers on Do Not Call registry to 565,167.
- Assisted the state's Emergency Operations Center during the January ice storm that resulted in significant power and telecommunications outages affecting thousands of South Dakotans.
- Aided a group of consumers in negotiating a settlement with their utility provider regarding excessive bills that resulted from meter errors. Discussion and research provided the foundation for staff to open a rule making docket to further study the appropriate allocation of costs for faulty meters.
