| (4) The independent organization, regional transmission
organization, or regional reliability entity must have access to information
that is required for wholesale settlement, load profiling, load research,
and reliability purposes.
(k) Cost recovery for deployment of AMS.
(1) Recovery Method. The commission will establish
a nonbypassable surcharge for an electric utility to recover reasonable
and necessary costs incurred in deploying AMS to residential customers
and nonresidential customers other than those required by the independent
system operator to have an interval data recorder meter. The surcharge
must not be established until after a detailed deployment plan is
filed under subsection (d) of this section. In addition, the surcharge
must not ultimately recover more than the AMS costs that are spent,
reasonable and necessary, and fully allocated, but may include estimated
costs that will be reconciled pursuant to paragraph (6) of this subsection.
As indicated by the definition of AMS in subsection (c)(2) of this
section, the costs for facilities that do not perform the functions
and have the features specified in this section must not be included
in the surcharge provided for by this subsection unless an electric
utility has received a waiver under subsection (g)(2) of this section.
The costs of providing AMS services include those costs of AMS installed
as part of a pilot program under this section. Costs of providing
AMS for a particular customer class must be surcharged only to customers
in that customer class.
(2) Carrying Costs. The annualized carrying-cost rate
to be applied to the unamortized balance of the AMS capital costs
must be the electric utility's authorized weighted-average cost of
capital (WACC). If the commission has not approved a WACC for the
electric utility within the last four years, the commission may set
a new WACC to apply to the unamortized balance of the AMS capital
costs. In each subsequent rate proceeding in which the commission
resets the electric utility's WACC, the carrying-charge rate that
is applied to the unamortized balance of the utility's AMS costs must
be correspondingly adjusted to reflect the new authorized WACC.
(3) Surcharge Proceeding. In the request for surcharge
proceeding, the commission will set the surcharge based on a levelized
amount, and an amortization period based on the useful life of the
AMS. The commission may set the surcharge to reflect a deployment
of advanced meters that is up to one-third of the electric utility's
total meters over each calendar year, regardless of the rate of actual
AMS deployment. The actual or expected net operating cost savings
from AMS deployment, to the extent that the operating costs are not
reflected in base rates, may be considered in setting the surcharge.
If an electric utility that requests a surcharge does not have an
approved deployment plan, the commission in the surcharge proceeding
may reconcile the costs that the electric utility already spent on
AMS in accordance with paragraph (6) of this subsection and may approve
a deployment plan.
(4) General Base Rate Proceeding while Surcharge is
in Effect. If the commission conducts a general base rate proceeding
while a surcharge under this section is in effect, then the commission
will include the reasonable and necessary costs of installed AMS equipment
in the base rates and decrease the surcharge accordingly, and permit
reasonable recovery of any non-AMS metering equipment that has not
yet been fully depreciated but has been replaced by the equipment
installed under an approved deployment plan.
(5) Annual Reports. An electric utility must file annual
reports with the commission updating the cost information used in
setting the surcharge. The annual reports must include the actual
costs spent to date in the deployment of AMS and the actual net operating
cost savings from AMS deployment and how those numbers compare to
the projections used to set the surcharge. During the annual report
process, an electric utility may apply to update its surcharge, and
the commission may set a schedule for such applications. For a levelized
surcharge, the commission may alter the length of the surcharge collection
period based on review of information concerning changes in deployment
costs or operating costs savings in the annual report or changes in
WACC. An annual report filed with the commission will not be a ratemaking
proceeding, but an application by the electric utility to update the
surcharge must be a ratemaking proceeding.
(6) Reconciliation Proceeding. All costs recovered
through the surcharge must be reviewed in a reconciliation proceeding
on a schedule to be determined by the commission. Notwithstanding
the preceding sentence, the electric utility may request multiple
reconciliation proceedings, but no more frequently than once every
three years. There is a presumption that costs spent in accordance
with a deployment plan or amended deployment plan approved by the
commission are reasonable and necessary. Any costs recovered through
the surcharge that are found in a reconciliation proceeding not to
have been spent or properly allocated, or not to be reasonable and
necessary, must be refunded to electric utility's customers. In addition,
the commission will make a final determination of the net operating
cost savings from AMS deployment used to reduce the amount of costs
that ultimately can be recovered through the surcharge. Accrual of
interest on any refunded or surcharged amounts resulting from the
reconciliation must be at the electric utility's WACC and must begin
at the time the under or over recovery occurred.
(7) Cross-subsidization and fees. The electric utility
must account for its costs in a manner that ensures there is no inappropriate
cost allocation, cost recovery, or cost assignment that would cause
cross-subsidization between utility activities and non-utility activities.
The electric utility shall not charge a disconnection or reconnection
fee that was approved by the commission prior to the effective date
of this rule, for a disconnection or reconnection that is effectuated
using the remote disconnection or connection capability of an advanced
meter.
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