STATE OF ILLINOIS
ILLINOIS COMMERCE COMMISSION
Ameren Illinois Company
d/b/a Ameren Illinois
Petition for Approval of Reconciliation of Rider TS -Transmission Service.
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11-0383
ORDER
By the Commission:
I. PRELIMINARY MATTERS
The Illinois Commerce Commission (“Commission”) approved Rider TS – Transmission Service (“Rider TS”) in Docket Nos. 06-0070 through 06-0072 (Cons.) on January 2, 2007, the rate proceeding pertaining to rates effective after the expiration of the “mandatory transition period.” Rider TS is applicable to customers taking service under Ameren Illinois Company d/b/a Ameren Illinois’ (“Ameren Illinois” or “Company”) Delivery Service (“DS”) Rates, Rate DS-1 through DS-5, and who are receiving company supplied power and energy. Pursuant to an amendment to Rider TS, the Company shall file a petition annually with the Commission no later than April 30, seeking initiation of an annual review to provide for correction of any accounting errors that may occur in the application of the provisions of Rider TS for the prior year. The information submitted shall allow the Commission to verify: 1) the revenue arising through Transmission Service Charges (“TSC”) during the reconciliation year, and 2) the revenue arising through the application of the TSC to applicable sales during the reconciliation year. The first such petition was filed on May 2, 2011, because April 30 fell on a weekend day and, pursuant to the tariff, the initial petition covered the 2007 through 2010 reporting years (“Reconciliation Period”).
Pursuant to proper legal notice, an evidentiary hearing was held in this matter before a duly authorized Administrative Law Judge of the Commission at its offices in Springfield, Illinois on October 11, 2011. Appearances were entered by Commission Staff ("Staff") and counsel for Ameren Illinois. The participants were afforded the opportunity to cross-examine all witnesses and to offer evidence with respect to all issues in this proceeding. At the conclusion of the aforesaid evidentiary hearing, the record was marked "Heard and Taken."
II. AMEREN ILLINOIS TESTIMONY
Mr. Dominic S. Perniciaro, Supervisor of Power Accounting for Ameren Services Company ("AMS"), an affiliated service company of Ameren Illinois, testified on behalf 11-0383
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of the Company. Mr. Perniciaro’s responsibilities include the accounting for transmission cost over and under collection. Mr. Perniciaro is also responsible for the calculations necessary to implement Rider TS. Mr. Perniciaro sponsored direct testimony identified as Ameren Exhibit 1.0, along with supporting exhibits identified as Ameren Exhibits 1.1, 1.2, 1.3, and 1.4 schedules which identified and reconciled all components of Rider TS costs and recoveries, as well as supporting his Affidavit identified as Ameren Exhibit 1.5.
The Reconciliation Period takes into account Rider TS as it was applied by the Company’s predecessor companies through the time of their merger, October 1, 2010. After the merger date, the reconciliation is for the Company only.
The results of Mr. Perniciaro’s analysis require an adjustment in the monthly allowable cost calculations and results in the need for a Factor O adjustment to collect an additional $74,115, in order to bring the filed under-recovery balance from $3,818,357 to the under-recovery balance of $3,892,472. He explains that the difference is the net of the corrected calculations for July 2007, March 2008, June 2008, July 2008, November 2008, December 2008, and February 2009. He further explains that the accounting errors were a series of the wrong number of days used in a particular month and that in those corrections related to the number of days, the amount of the adjustment is the project of the difference in days, the native peak load and the effective Midwest Independent Transmission System Organization (“MISO”) rate.
Mr. Leonard M. Jones, Manager, Rates & Analysis for Ameren Illinois, sponsored direct testimony identified as Ameren Exhibit 2.0, along with his supporting Affidavit identified as Ameren Exhibit 2.1.
Mr. Jones described Rider TS as an unbundled tariff that charges customers taking the Company-supplied power and energy for transmission service at prices regulated under the jurisdiction of the Federal Energy Regulatory Commission (“FERC”). Rider TS provides for the recovery of costs, fees and charges related to transmission service for the provision of power and energy at retail by Ameren Illinois, not otherwise recovered under power supply tariffs. With the exception of rate-zone specific Uncollectible Adjustment factors, Mr. Jones explains that Rider TS is identical by the three rate zones which are: Rate Zone 1 (formerly the AmerenCIPS service territory), Rate Zone II (formerly the AmerenCILCO service territory) and Rate Zone III (formerly the AmerenIP service territory).
Mr. Jones also testified that Rider TS was designed to be complimentary to the process for procuring power and energy in the wholesale market for eventual delivery to retail customers after the expiration of the “mandatory transition period.” Rider TS was adopted as a means to pass on a level of charges associated with Transmission Service to those customers that use the service because these particular charges are not included in Ameren Illinois-provided power and energy service rates; instead 11-0383
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Transmission Service is unbundled and the related charges are recovered separately through the rider.
Mr. Jones explained the following: 1) what costs are recovered by Rider TS; 2) how the charges are set; 3) how adjustments to Rider TS are made; and, 4) how Ameren Illinois tracks the costs recovered through Rider TS.
Mr. Jones described modifications made to Rider TS since it was initially adopted. The first modification made in May 2008, removed references to Rider MV – Market Value (“Rider MV”) and Rider RTP-L – Real Time Pricing – Large (“Rider RTP-L”), and replaced it with references to Riders PER – Purchased Electricity Recovery (“Rider PER”) and Rider HSS – Hourly Supply Service (“Rider HSS”). The second modification effective in late May 2010, removed references to Supplier Forward Contracts (“SFCs”) which expired at the end of May 2010. The third modification made to Rider TS since its adoption became effective July 3, 2010, and added the provision to file a petition annually to initiate an annual review to correct any potential accounting errors which may have occurred within Rider TS.
III. STAFF TESTIMONY
Ms. Theresa Ebrey, an Accountant in the Accounting Department of the Financial Analysis Division of the Commission, sponsored direct testimony identified as ICC Staff Exhibit 1.0. Ms. Ebrey testified that she reviewed and analyzed Ameren Illinois’ reconciliation of revenues collected under Rider TS with the costs recoverable under the terms of Rider TS, as well as the Company’s responses to Staff data requests and internal audit reports provided by the Company. Ms. Ebrey testified that she takes no issue with the Rider TS revenues included in the reconciliations.
Ms. Ebrey explained that the total recoverable costs did not coincide with the costs used in the monthly filings during the reconciliation period. Ameren Exhibit 1.3 identified seven months in which the costs used for the monthly filings did not agree with the costs calculated for the reconciliation, but that these variances, which support the Company’s request for an Ordered Factor O recovery of $74,115, were explained in the direct testimony of Company witness Mr. Perniciaro.
Ms. Ebrey explained why an Uncollectible Adjustment during the period January 2007 through May 2008 was included in the detail of costs. Ameren Illinois had become aware in mid-2008 that it had not been including an uncollectible adjustment factor in the formulae within Rider TS. To correct this in June 2008, the Company began including both the amount undercharged for the prior 17 months of the Reconciliation Period, as well as an uncollectible adjustment in its calculation of the monthly Rider TS charge. Ms. Ebrey recommends the Commission accept these foregoing explanations and approve the allowable costs as presented on Ameren Exhibit 1.3. Ms. Ebrey further recommends the Commission accept the reconciliation of revenues collected under Rider TS with recoverable costs as reflected in the attached Appendix, as well as direct Ameren Illinois to collect the additional Factor O amount 11-0383
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described above in the first monthly Rider TS informational filing after the date of the Order in this docket.
IV. FINDINGS AND ORDERING PARAGRAPHS
The Commission, having considered the entire record and being fully advised in the premises, is of the opinion and finds that:
(1) Ameren Illinois Company d/b/a Ameren Illinois is a corporation engaged in the distribution of electricity and natural gas to the public in Illinois, and, as such, is a public utility within the meaning of the Public Utilities Act;
(2) the Commission has jurisdiction over Ameren Illinois and of the subject matter of this proceeding;
(3) the statements of fact set forth in the prefatory portion of this Order are supported by the record and are hereby adopted as findings of fact;
(4) the evidence shows that for the calendar years 2007 through 2010, Ameren Illinois acted reasonably and prudently in the assessment of costs recoverable through Transmission Service tariff charges during the Reconciliation Period, subject to the Factor O under-recovery of $74,115 described herein above;
(5) the evidence also shows that for the calendar years 2007 through 2010, Ameren Illinois acted reasonably and prudently in the collection of revenues arising through the application of the Transmission Service charges during the Reconciliation Period;
(6) the reconciliation of revenues collected under Ameren Illinois’ Transmission Service tariff with the actual costs prudently incurred for the application of the Transmission Service tariff during the Reconciliation Period, as reflected in the Appendix attached hereto, should be approved;
(7) all motions, petitions, objections, or other matters in this proceeding that remain unresolved should be resolved consistent with the conclusion contained herein;
IT IS THEREFORE ORDERED by the Illinois Commerce Commission that the reconciliation submitted by Ameren Illinois of the revenues collected under its Transmission Service tariff with costs prudently incurred for the application of the Transmission Service tariff during calendar years 2007 through 2010, as reflected in the attached Appendix, is hereby approved.11-0383
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IT IS FURTHER ORDERED that the Factor O under-recovery of $74,115 resulting from the reconciliation be implemented by Ameren Illinois Company in the first monthly Rider TS informational filing made after the date of the Order in this docket.
IT IS FURTHER ORDERED that all motions, petitions, objections, or other matters in this proceeding that remain unresolved are hereby resolved consistent with the conclusion contained herein.
IT IS FURTHER ORDERED that, subject to the provisions of Section 10-113 of the Public Utilities Act and 83 Ill. Adm. Code 200.880, this Order is final; it is not subject to the Administrative Review Law.
By order of the Commission this 22nd day of November, 2011.
(SIGNED) DOUGLAS P. SCOTT
Chairman
