Title of Regulation: 20VAC5-201. Rules Governing Utility Rate Applications and Annual Informational Filings (amending 20VAC5-201-10, 20VAC5-201-20, 20VAC5-201-50, 20VAC5-201-90).

Statutory Authority: §§ 12.1-13 and 56-585.1 of the Code of Virginia.

Effective Date: February 1, 2013.

Agency Contact: Tim Lough, Special Projects Engineer, Division of Energy Regulation, State Corporation Commission, P.O. Box 1197, Richmond, VA 23218, telephone (804) 371-9590, FAX (804) 371-9350, or email tim.lough@scc.virginia.gov.

Summary:

Section 56-585.1 A 2 c of the Code of Virginia establishes a performance incentive for investor-owned incumbent electric utilities, which authorizes the State Corporation Commission to increase or decrease a utility's combined rate of return on common equity by up to 100 basis points for generating plant performance, customer service, and operating efficiency as compared to nationally recognized standards determined by the commission to be appropriate for such purposes. The proposed amendments implement the performance incentives by requiring investor-owned incumbent electric utilities to file data pertaining to their generating plant performance, customer service, and operating efficiency with their biennial review applications.

Changes to the proposed regulations include (i) exempting those investor-owned electric utilities who are receiving a Renewable Portfolio Standard Performance Incentive under § 56-585.2 C of the Code of Virginia from filing the information if they are not seeking more than a 50 basis point increase in their combined rate of return on common equity pursuant to § 56-585.1 A 2 c of the Code of Virginia, (ii) eliminating the requirement that investor-owned electric utilities file J.D. Power and Associates' surveys, and (iii) modifying the filing requirements to give investor-owned electric utilities greater discretion when filing information describing the specific actions, costs, and benefits of actions undertaken to improve generating plant performance, customer service, and operating efficiency.

AT RICHMOND, JANUARY 11, 2013

COMMONWEALTH OF VIRGINIA, ex rel.

STATE CORPORATION COMMISSION

CASE NO. PUE-2012-00021

Ex Parte: In re: In the matter of adopting
rules and regulations for consideration of the
Performance Incentive authorized by
§ 56-585.1 A 2 c of the Code of Virginia

ORDER ADOPTING RULES AND REGULATIONS

On March 5, 2012, the State Corporation Commission ("Commission") issued an Order Initiating Rulemaking Proceeding ("Initial Order") to develop rules and regulations to implement the Performance Incentive authorized by § 56-585.1 A 2 c of the Code of Virginia ("Code"). This statute, enacted in 2007 as part of the Virginia Electric Utility Regulation Act,¹ establishes a Performance Incentive for investor-owned incumbent electric utilities which authorizes the Commission to increase or decrease a utility's combined rate of return on common equity by up to 100 basis points based on a utility's generating plant performance, customer service, and operating efficiency, as compared to nationally recognized standards determined by the Commission to be appropriate for such purposes. The Initial Order directed the Commission's Staff ("Staff") to develop proposed rules and regulations to implement the Performance Incentive statute; to solicit input from stakeholders and other interested persons when developing the proposed rules and regulations; and to file the proposed rules and regulations with the Commission no later than September 5, 2012. Further, when developing the proposed rules and regulations, the Commission directed its Staff not to propose rules and regulations that included a "mechanical" or "formulaic" approach that would limit the Commission's discretion when considering whether to implement a positive or negative Performance Incentive in future cases.

On September 5, 2012, the Staff filed its report ("Staff Report") with the Commission. The Staff Report, among other things, described the collaborative process undertaken by the Staff to develop the proposed rules and regulations; summarized the comments of the various stakeholders and interested persons made during the course of the collaborative process; and contained the Staff's proposed rules and regulations to implement the Performance Incentive authorized by § 56-585.1 A 2 c of the Code.

On September 14, 2012, the Commission issued an Order for Notice and Hearing, which, among other things, revised the proposed rules and regulations to require investor-owned incumbent electric utilities to file additional data with their biennial review applications detailing: (i) the proposed basis point increase in the combined rate of return on common equity and the revenue requirement impact of the utility's proposed Performance Incentive, if applicable; (ii) the specific actions undertaken by the utility to improve generating plant performance, customer service, and operating efficiency; (iii) the incremental costs of any such actions undertaken by the utility to improve performance; and (iv) the specific benefits, financial or otherwise, that customers receive as a result of such actions to improve the utility's generating plant performance, customer service, and operating efficiency. The Commission's Order for Notice and Hearing further directed that public notice of the proposed rules and regulations, as revised by the Commission, be published in newspapers of general circulation in Virginia and in the Virginia Register of Regulations; allowed interested persons to file written comments on the proposed rules and regulations on or before November 9, 2012; and scheduled a hearing on November 19, 2012, to receive and consider oral comments on the proposed rules and regulations.

On or before November 9, 2012, written comments were filed by Virginia Electric and Power Company ("DVP"), Appalachian Power Company ("APCo"), the Virginia Committee for Fair Utility Rates and the Old Dominion Committee for Fair Utility Rates (collectively, the "Committees"), the Southern Environmental Law Center ("SELC"), the Fairfax County Board of Supervisors, and AARP Virginia ("AARP").

The public hearing was convened on November 19, 2012, at which time oral comments were received from the following participants, by counsel: DVP, APCo, the Committees, SELC, the Division of Consumer Counsel, Office of the Attorney General ("Consumer Counsel"), and the Staff. Barbara Alexander appeared on behalf of AARP and Whitney Byrd appeared on behalf of the Wise Energy for Virginia Coalition and testified as public witnesses.

NOW THE COMMISSION, having considered this matter, is of the opinion and finds that the rules and regulations appended hereto as Attachment A should be adopted effective February 1, 2013.

While the Commission will not respond to each comment relating to the proposed rules and regulations in this Order, it has considered all comments submitted, both in writing and at the public hearing, and will address certain of those comments as follows.

Initially, the Commission notes that § 56‑585.2 C of the Code prevents it from implementing a Performance Incentive lower than 50 basis points when a utility has achieved its renewable portfolio standard ("RPS") goals. That is, if a utility has received a 50 basis point RPS performance incentive as required by statute, then the Commission cannot reduce it by approving a Performance Incentive below 50 basis points. In such instance, the only action the Commission can take is to increase the Performance Incentive to something greater than 50 basis points. Thus, if a utility has received an applicable RPS performance incentive, it only shall be required to file Schedule 49 if it seeks a Performance Incentive higher than 50 basis points. This provision should not, however, be viewed as a determination that information related to generating plant performance, customer service, and operating efficiency is necessarily irrelevant for discovery and evidentiary purposes in a biennial review proceeding.

If a utility does not have an applicable RPS performance incentive, it shall be required to file Schedule 49 regardless of whether it seeks a positive Performance Incentive under § 56‑585.1 A 2 c of the Code. Under the statute, this Performance Incentive can be positive or negative. Even if a utility does not seek a positive Performance Incentive, the information in Schedule 49 may be relevant in analyzing whether a negative Performance Incentive is warranted. Indeed, only requiring Schedule 49 when a utility seeks a positive Performance Incentive results in an asymmetrical requirement that is inconsistent with the statutory provisions providing for both positive and negative Performance Incentives. Thus, absent an applicable RPS performance incentive as discussed above, interested parties and the Staff will have access to information in Schedule 49, as it must be filed as part of the utility's biennial review.

The Commission further finds that Schedule 49 should be modified to eliminate the filing requirement for J.D. Power and Associates' surveys. Such surveys, by their very nature, are too subjective to rely upon when determining whether an incumbent electric utility should be awarded a positive or negative Performance Incentive. In many cases, the results of such surveys are based more on customer perceptions rather than objective, quantifiable data indicating superior or inferior customer service by a utility. The best example of the subjective nature of such surveys relates to a utility's level of rates and/or frequency of rate increase applications. Customers may be more likely to give negative responses in such surveys if they believe that a utility's rates are too high or that a utility's requests for rate relief are too frequent, even though a utility's customer service may be good or even excellent based upon objective, quantifiable data measuring the level of customer service. The Commission agrees with AARP and finds that J.D. Power and Associates' surveys are too subjective to use when measuring a utility's customer service and determining whether a positive or negative Performance Incentive should be applied.² Accordingly, we will remove the filing requirements imposed under Schedule 49 (a), Customer service, subsections (4‑5).³

DVP opposed certain additions the Commission made to the Staff's proposed rules and regulations requiring incumbent electric utilities to file information on the actions undertaken by a utility to improve generating plant performance, customer service, and operating efficiency; specifically, DVP objected to the information required under Schedule 49 (a), Additional data, subsections (2-4). DVP asserted that the Commission should focus on the Company's overall performance — not on the specific individual actions undertaken and the incremental costs of such actions — and further questioned how a utility could determine which specific costs were for incremental improvement and which were for maintaining existing service levels. DVP also asserted that the Performance Incentive statute does not require the Commission to perform any cost/benefit analyses when evaluating whether a Performance Incentive should be applied and believes such an approach should not be utilized. Unlike DVP, APCo did not object to Schedule 49 (a), Additional data, subsections (2-4) in toto. Rather, APCo asserted that it may be difficult to quantify specific customer benefits, as proposed in Schedule 49 (a), Additional data, subsection (3), resulting from its incremental expenditures to improve performance. In this regard, we clarify that the purpose of the Additional data is not to "establish a second rate case" as part of the Performance Incentive evaluation (contrary to DVP's concern).⁴ The reasonableness and prudence of any costs, as well as whether any expenditures were exorbitant, unnecessary, wasteful, or extravagant,⁵ will be addressed for rate purposes as part of the biennial review and/or rate case. Rather, for the specific purpose of the Performance Incentive, the Additional data may be relevant to the Commission's determination of whether to exercise our discretion under the statute to institute any Performance Incentive (positive or negative) at all.⁶

As the Staff noted during the hearing, a 100 basis point Performance Incentive could increase DVP's base rates by approximately $76 million and APCo's base rates by approximately $15.5 million. Thus, for example, the Additional data addresses, among other things, whether the costs incurred by a utility to improve its generating plant performance, customer service, and operating efficiency primarily benefit the utility's customers. The Commission also recognizes, however, the open-ended nature of the potential data that may be responsive to and required by Schedule 49 (a), Additional data, subsections (2-3). Accordingly, the Commission has modified these two filing requirements explicitly to allow the utility to choose the extent of such data that it includes in its filing for the exercise of our discretion under the Performance Incentive statute.

APCo also requested that its generating plant performance, customer service, and operating efficiency only be compared with its own historic performance levels when determining whether a Performance Incentive should be applied and not be compared with peer group data. DVP requested a similar approach when measuring customer service using, for example, the System Average Interruption Duration Index ("SAIDI") and the System Average Interruption Frequency Index ("SAIFI"). The primary reasons cited in support of these recommendations are the differences between utility service territories, generation mix, and reporting for SAIDI and SAIFI, which may render direct comparisons with DVP and APCo to peer group data unreliable or meaningless.

The Commission finds, however, that the benchmarking analyses included in the proposed rules and regulations should be retained. Such information may, on a case-by-case basis, be relevant in exercising the Commission's discretion under this statute. A utility's generating plant performance, for example, may be trending upward over time but may fall well below the performance levels of its peers. Conversely, a utility's generating plant performance may be trending downward over time, but such performance may be far superior to the generating plant performance of a utility's peers. The Commission finds that the filing requirements for peer group data, which can be used for benchmarking purposes, should be retained in Schedule 49.

The Commission further recognizes that differences in service territories, generation mix, and methods of reporting exist among utilities. However, the solution to this problem is not to entirely eliminate the filing requirement for peer group data, which can be used for benchmarking purposes. Rather, differences between a utility's data and peer group data can be addressed and litigated in the context of a utility's biennial review proceeding. If comparisons are not appropriate based upon these differences, the peer group data can be given little, if any, weight when exercising the Commission's discretion under the Performance Incentive statute.

The SELC recommended that the proposed rules and regulations be modified to include an energy efficiency performance metric for operating efficiency that benchmarks: (1) energy efficiency savings, as measured as a percentage of electricity saved per megawatthour of retail sales; and (2) energy efficiency expenditures, measured as an incumbent electric utility's spending on qualified energy efficiency programs per megawatthour of retail sales. While it may be in the public interest to encourage cost-effective energy efficiency programs that save consumers money and that can delay or eliminate the construction or purchase of new generating plants, we do not find it appropriate to adopt SELC's proposal since other provisions of law cover energy efficiency programs. Specifically, under § 56‑585.1 A 5 c of the Code, an incumbent electric utility can recover through a rider certain projected and actual costs of approved energy efficiency programs, a margin on its operating expenses equal to the utility's rate of return on common equity, and potentially its lost revenues related to the implementation of energy efficiency programs. We find that it would be inappropriate to consider energy efficiency programs when implementing the Performance Incentive statute because it could have the effect of giving utilities even greater revenues from ratepayers for energy efficiency programs than those envisioned by the General Assembly when it enacted § 56-585.1 A 5 c of the Code. Further, the cost effectiveness of energy efficiency programs is a relevant issue in proceedings under that Code section, where costs and benefits to consumers are thoroughly evaluated and quantified contrary to a Performance Incentive evaluation.

In addition, APCo discussed potential issues in obtaining certain data and the need for waivers resulting therefrom. In this regard, we note that the Instructions to Schedule 49 provide as follows: "In the event the required filing information is not available, the IOU shall note the omission and state the reason." Thus, if the required information is not available to the utility, Schedule 49 requires an explanation, not a request for waiver.

Finally, Consumer Counsel, the Fairfax County Board of Supervisors, and the Committees supported the filing requirements proposed by Schedule 49. The Committees recommended, however, that incumbent utilities be required to file all the peer group data required by Schedule 49 in a utility's first biennial review after the rules and regulations are adopted. Under the Committees' proposal, once the Commission determines the appropriate peer groups for benchmarking purposes, those groups would be used for all future filings until the Commission orders otherwise. We find the Committees' recommendation should not be accepted. If a respondent in a biennial review disagrees with the peer groups recommended by an incumbent electric utility, the respondent may propose different peer groups, which are more closely aligned to the operational characteristics of the utility.

Accordingly, IT IS ORDERED THAT:

(1) The Commission's Rules Governing Utility Rate Applications and Annual Informational Filings, as set forth in 20 VAC 5-201-10 et seq., are hereby revised and adopted as set forth in the attachment to this Order Adopting Rules and Regulations, effective February 1, 2013.

(2) The Commission's Division of Information Resources shall forward this Order Adopting Rules and Regulations and the rules and regulations adopted herein to the Registrar of Virginia for publication in the Virginia Register of Regulations.

(3) This case shall be dismissed from the Commission's docket of active proceedings and the papers filed herein shall be placed in the Commission's file for ended causes.

AN ATTESTED COPY hereof shall be sent by the Clerk of the Commission to all persons on the official Service List in this proceeding. The Service List is available from the Clerk of the Commission, c/o Document Control Center, 1300 East Main Street, First Floor, Tyler Building, Richmond, Virginia 23219. A copy also shall be sent to the Commission's Office of General Counsel and Divisions of Energy Regulation and Utility Accounting and Finance.

¹Section 56-576 et seq. of the Code.

²DVP and APCo also recommended against the inclusion of J.D. Power and Associates' surveys in the proposed rules. See APCo Comments at 6; Tr. at 27.

³The cites to the proposed rules and regulations in this Order reflect the format of the proposed rules published in the Virginia Register of Regulations on October 8, 2012.

⁴DVP Comments at 16.

⁵See, e.g., § 56‑585.1 D of the Code; Norfolk v. Chesapeake and Potomac Tel. Co. of Virginia, 192 Va. 292, 311‑12, 64 S.E. 2d 772, 783-84 (1951); and Lake of the Woods Utility Co., etc. v. State Corporation Commission, etc., 223 Va. 100, 110, 286 S.E. 2d 201, 206 (1982).

⁶Moreover, the particular relevancy (if any) of specific information, whether required or not by these rules, in a particular biennial review proceeding may be addressed as part of that proceeding.

20VAC5-201-10. General filing instructions.

A. An applicant shall provide a notice of intent to file an application pursuant to 20VAC5-201-20, 20VAC5-201-40, 20VAC5-201-60 and 20VAC5-201-85 to the commission 60 days prior to the application filing date.

B. Applications pursuant to 20VAC5-201-20 through 20VAC5-201-70 shall include:

1. The name and post office address of the applicant and the name and post office address of its counsel.

2. A full clear statement of the facts that the applicant is prepared to prove by competent evidence.

3. A statement of details of the objective or objectives sought and the legal basis therefore.

4. All direct testimony by which the applicant expects to support the objective or objectives sought.

5. Information or documentation conforming to the following general instructions:

a. Attach a table of contents of the company's application, including exhibits.

b. Each exhibit shall be labeled with the name of the applicant and the initials of the sponsoring witness in the upper right hand corner as shown below:

Exhibit No. (Leave Blank)
Witness: (Initials)
Statement or
Schedule Number

c. The first page of all exhibits shall contain a caption that describes the subject matter of the exhibit.

d. If the accounting and statistical data submitted differ from the books of the applicant, then the applicant shall include in its filing a reconciliation schedule for each account or subaccount that differs, together with an explanation describing the nature of the difference.

e. The required accounting and statistical data shall include all work papers and other information necessary to ensure that the items, statements and schedules are not misleading.

C. These rules do not limit the commission staff or parties from raising issues for commission consideration that have not been addressed in the applicant's filing before the commission. Except for good cause shown, issues specifically decided by commission order entered in the applicant's most recent rate case may not be raised by staff or interested parties in Earnings Test Filings made pursuant to 20VAC5-201-10, 20VAC5-201-30 or 20VAC5-201-50.

D. An application filed pursuant to 20VAC5-201-20, 20VAC5-201-30, 20VAC5-201-40, 20VAC5-201-60, 20VAC5-201-70, 20VAC5-201-80 or 20VAC5-201-85 shall not be deemed filed per Chapter 10 (§ 56-232 et seq.) or Chapter 23 (§ 56-576 et seq.) of Title 56 of the Code of Virginia unless it is in full compliance with these rules.

E. The commission may waive any or all parts of these rate case rules for good cause shown.

F. Where a filing contains information that the applicant claims to be confidential, the filing may be made under seal provided it is simultaneously accompanied by both a motion for protective order or other confidential treatment and an additional five copies of a redacted version of the filing to be available for public disclosure. Unredacted filings containing the confidential information shall, however, be immediately available to the commission staff for internal use at the commission.

G. Filings containing confidential (or redacted) information shall so state on the cover of the filing, and the precise portions of the filing containing such confidential (or redacted) information, including supporting material, shall be clearly marked within the filing.

H. Applicants shall file electronic media containing an electronic spreadsheet version of Schedules 1-5, 8-28, 36, 40, and 49 50, as applicable, with the Division of Public Utility Accounting, the Division of Economics and Finance and the Division of Energy Regulation or the Division of Communications, as appropriate. Such electronic media containing calculations derived from formulas shall be provided in an electronic spreadsheet including all underlying formulas and assumptions. Such electronic spreadsheet shall be commercially available and have common use in the utility industry. Additional versions of such schedules shall be made available to parties upon request.

I. All applications, including direct testimony and Schedules 1-28, 30-39, and 41-49 41-50, as applicable, shall be filed in an original and 12 copies with the Clerk of the Commission, c/o Document Control Center, P.O. Box 2118, Richmond, Virginia 23218. One copy of Schedules 29 and 40 shall be filed with the Clerk of the Commission. Applicants may omit filing Schedule 29 with the Clerk of the Commission in Annual Informational Filings. Additional copies of such schedules shall be made available to parties upon request.

Two copies of Schedules 29 and 40 shall be submitted to the Division of Public Utility Accounting or the Division of Communications, as appropriate. Two copies of Schedule 40 shall be submitted to the Division of Energy Regulation.

J. For any application made pursuant to 20VAC5-201-20 and 20VAC5-201-40 through 20VAC5-201-85, the applicant shall serve a copy of the information required in 20VAC5-201-10 subsection A and subdivisions B 1 through B 3 of this section, upon the attorney and chairman of the board of supervisors of each county (or equivalent officials in the counties having alternate forms of government) in this Commonwealth affected by the proposed increase and upon the mayor or manager and the attorney of every city and town (or equivalent officials in towns and cities having alternate forms of government) in this Commonwealth affected by the proposed increase. The applicant shall also serve each such official with a statement that a copy of the complete application may be obtained at no cost by making a request therefor orally or in writing to a specified company official or location. In addition, the applicant shall serve a copy of its complete application upon the Division of Consumer Counsel of the Office of the Attorney General of Virginia. All such service specified by this rule shall be made either by (i) personal delivery or (ii) first class mail, to the customary place of business or to the residence of the person served.

K. Nothing in these rules shall be interpreted to apply to applications for temporary reductions of rates pursuant to § 56-242 of the Code of Virginia.

20VAC5-201-20. General and expedited rate increase applications.

A. An application for a general or expedited rate increase pursuant to Chapter 10 (§ 56-232 et seq.) of Title 56 of the Code of Virginia for a public utility having annual revenues exceeding $1 million, shall conform to the following requirements:

1. Exhibits consisting of Schedules 1-43 and the utility's direct testimony shall be submitted. Such schedules shall be identified with the appropriate schedule number and shall be prepared in accordance with the instructions contained in 20VAC5-201-90.

2. An applicant subject to § 56-585.1 of the Code of Virginia shall file Schedules 45 and 47 in addition to the schedules required in 20VAC5-201-20 subdivision A 1 of this section in accordance with the instructions accompanying such schedules in 20VAC5-201-90.

3. An exhibit consisting of additional schedules may be submitted with the utility's direct testimony. Such exhibit shall be identified as Schedule 49 50 (this exhibit may include numerous subschedules labeled 49A 50A et seq.).

B. The selection of a historic test period is up to the applicant. However, the use of overlapping test periods will not be allowed.

C. Applicants meeting each of the four following criteria may omit Schedules 9-18 in rate applications: (i) the applicant is not subject to § 56-585.1 of the Code of Virginia, (ii) the applicant is not currently bound by a performance-based regulation plan authorized by the commission pursuant to § 56-235.6 of the Code of Virginia that includes an earnings sharing mechanism or other attribute for which the commission has directed the performance of an Earnings Test, (iii) the applicant has no Virginia jurisdictional regulatory assets on its books, and (iv) the applicant is not seeking to establish a regulatory asset.

D. If not otherwise constrained by law or regulatory requirements, an applicant who has not experienced a substantial change in circumstances may file an expedited rate application as an alternative to a general rate application. Such application need not propose an increase in regulated operating revenues. If, upon timely consideration of the expedited application and supporting evidence, it appears that a substantial change in circumstances has taken place since the applicant's last rate case, then the commission may take appropriate action, such as directing that the expedited application be dismissed or treated as a general rate application. Prior to public hearing, and subject to applicable provisions of law, an application for expedited rate increase may take effect within 30 days after the date the application is filed. Expedited rate increases may also take effect in less than 12 months after the applicant's preceding rate increase so long as rates are not increased as a result thereof more than once in any calendar year. An applicant making an expedited application shall also comply with the following rules:

1. In computing its cost of capital, as prescribed in Schedule 3 in 20VAC5-201-90, the applicant, other than those utilities subject to § 56-585.1 of the Code of Virginia, shall use the equity return rate approved by the commission and used to determine the revenue requirement in the utility's most recent rate proceeding.

2. An applicant, in developing its rate of return statement, shall make adjustments to its test period jurisdictional results only in accordance with the instructions for Schedule 25 in 20VAC5-201-90.

3. The applicant may propose new allocation methodologies, rate designs and new or revised terms and conditions provided such proposals are supported by appropriate cost studies. Such support shall be included in Schedule 40.

E. Rates authorized to take effect 30 days following the filing of any application for an expedited rate increase shall be subject to refund in a manner prescribed by the commission. Whenever rates are subject to refund, the commission may also direct that such refund bear interest at a rate set by the commission.

20VAC5-201-50. Biennial review applications.

A. A biennial review application filed pursuant to § 56-585.1 of the Code of Virginia shall include the following:

1. Exhibits consisting of Schedules 3, 6-7, 9-18, 40a and 44 as identified in 20VAC5-201-90 shall be submitted with the utility's direct testimony for each of the two successive 12-month test periods.

2. Exhibits consisting of Schedules 1-2, 4-5, 8, 19-34, 36-39, 40b-d, 41-43, 45, and 47 as identified in 20VAC5-201-90, shall be submitted with the utility's direct testimony for the second of the two successive 12-month test periods.

3. An exhibit consisting of Schedule 35 shall be filed with the commission no later than April 30 each year.

4. An exhibit consisting of Schedule 49 shall be submitted with the utility's direct testimony [ , if required ].

4. 5. An exhibit consisting of additional schedules may be submitted with the utility's direct testimony. Such exhibit shall be identified as Schedule 49 50 (this exhibit may include subschedules as needed labeled 49A 50A et seq.).

5. 6. A reconciliation of Schedules 19 and 22 to the statement of income and comparative balance sheet contained in FERC Form No. 1.

B. The assumed rate year for purposes of determining ratemaking adjustment in Schedules 21 and 24, as identified in 20VAC5-201-90, shall begin on December 1 of the year following the two successive 12-month test periods.

20VAC5-201-90. Instructions for schedules and exhibits for Chapter 201.

The following instructions for schedules and exhibits including those specifically set forth in 20VAC5-201-95 (Schedules 1-14), 20VAC5-201-100 (Schedules 15-22) and 20VAC5-201-110 (Schedules 23-28, 40 and 44) are to be used in conjunction with this chapter:

Schedule 49 - Data Pertaining to Nationally Recognized Standards for Generating Plant Performance, Customer Service, and Operating Efficiency

Instructions: Investor-owned incumbent electric utilities subject to § 56-585.1 A 2 c of the Code of Virginia shall [ , unless otherwise exempted from these instructions, ] file the information listed in paragraph (a), and paragraph (b) if applicable, of this schedule, using the definitions provided below. Unless otherwise specified, the minimum filing requirements shall include annual weighted averages, separately, for each of the most recent consecutive six years of data including the biennial period under review. Where weighted averages are not available, simple averages are acceptable. Averages shall be identified as weighted or simple. Where six years of data is not available when filed, the reason shall be stated and the data shall be provided as soon as it becomes available, if at all. In the IOU's initial filing under these rules, the IOU may propose and support a different benchmark group for each operating efficiency performance measure. Once the commission establishes a benchmark group for an operating efficiency performance measure, the benchmark group shall apply to the operating efficiency performance measure in all of the IOU's future filings under these rules unless otherwise ordered by the commission. To the extent practical, data should be obtained from publically available sources such as SEC, FERC, EIA, and RTO. In the event the required filing information is not available, the IOU shall note the omission and state the reason. [ Investor-owned incumbent electric utilities receiving an RPS Performance Incentive pursuant to § 56-585.2 C of the Code of Virginia and not seeking a Performance Incentive pursuant to § 56-585.1 A 2 c of the Code of Virginia of more than 50 basis points need not submit Schedule 49. ]

Definitions for Schedule 49:

The following words and terms when used in this schedule shall have the following meanings unless the context clearly indicates otherwise:

"Average retail price" or "total average retail rate" means total annual revenues per annual kWh of sales as reported to EEI.

"Average speed of answer" or "ASA" means the average time in seconds that callers experience in a queue to reach an agent or to initiate a transaction through an interactive voice response system.

"Benchmark group" means one of the following groups of investor-owned electric utilities proposed by the IOU for an operating efficiency performance measure: MACRUC, ROE Peer Group, RTO, SEARUC, and SEE. The IOU may propose and support the use of an alternative group of investor-owned electric utilities determined by an independent expert to be a valid comparable group.

"Btu" means British thermal unit.

"EEI" means the Edison Electric Institute.

"EIA" means the United States Energy Information Administration.

"Equivalent availability factor" or "EAF" means the fraction of a given operating period in which a generating unit is available without any outages and equipment or seasonal deratings.

"Equivalent forced outage rate on demand" or "EFORd" means a measure of the probability that a generating unit will not be available due to forced outages or forced deratings when there is demand on the unit to generate. When used as a measure of historical performance, EFORd is calculated as the percentage of total demand time that a unit was unavailable due to forced outages or deratings.

"FERC" means the Federal Energy Regulatory Commission or its successor agency.

"FERC Form 1" means 18 CFR 141.1, FERC Form No. 1, Annual Report of Major Electric Utilities, Licensees, and Others.

"Fleet maintenance cost" means the sum of all plants' maintenance costs from FERC Form 1, pages 402 and 403, lines 29-33.

"Heat rate" or "HR" means how efficiently a generator converts heat energy from fuel into electrical energy. Heat rate is calculated by dividing the thermal energy consumption by the electric energy generated (Btu/kWh).

"IOU" means investor-owned incumbent electric utility.

"Interactive voice response" or "IVR" means a technology that automates the interaction between the utility and its customer.

"ITP" means the NRC's industry trends program.

"kWh" means kilowatt-hour.

"Large coal plant or plants" means a location having coal-fired generation capacity of greater than 400 MW, excluding coal units with capacities of less than 200 MW.

"MACRUC utility" means a regulated investor-owned electric utility having generation, transmission, and distribution business within the member states of the Mid-Atlantic Conference of Regulatory Utilities Commissioners or its successor organization.

"MW" means megawatt.

"MWh" means megawatt-hour.

"NERC" means the North American Electric Reliability Corporation or its successor organization.

"Net capacity factor (nuclear)" or "NCF (nuclear)" means the fraction of net energy generated by a nuclear unit compared to the energy it could have generated if operated at the net maximum dependable capacity for a year.

"NRC" means the United States Nuclear Regulatory Commission or its successor agency.

"O&M" means operations and maintenance.

"O&M efficiency" means total electric O&M expense (from FERC Form 1, page 323, line 198) as a percent of total assets (from FERC Form 1, page 111, line 85) (or $ per MWh or $ per customer).

"Plant production cost" means total production expense per MWh of net output.

"PWR" means pressurized water reactor.

"ROE peer group" means the investor-owned electric utilities defined under § 56-585.1 A 2 b of the Code of Virginia.

"RTO" means the regional transmission organization of which the IOU is a member.

"SEARUC utility" means a regulated investor-owned electric utility having generation, transmission, and distribution business within the member states of the Southeastern Association of Regulatory Utility Commissioners or its successor organization.

"SEC" means the United States Securities and Exchange Commission.

"SEE utility" means a regulated investor-owned electric utility member of the Southeastern Electric Exchange or its successor organization having generation, transmission, and distribution business.

"Service level" means the percentage of calls that are answered by a call center agent or an IVR within 30 seconds.

"System average interruption duration index" or "SAIDI" means the total duration of interruption for the average customer on an annual basis. SAIDI equals the sum of customer interruption durations divided by the average total number of customers served.

"System average interruption frequency index" or "SAIFI" means the average number of interruptions that a customer would experience on an annual basis, expressed as a number. SAIFI equals the sum of customer interruptions divided by an average total number of customers served.

"XEFORd" means a measure of the probability that a generating unit will not be available due to forced outages or forced deratings when there is demand on the unit to generate which is the same as EFORd, but excludes events that are designated as outside management's control.

Filing Requirements:

(a) IOUs subject to § 56-585.1 A 2 c of the Code of Virginia shall file the following data for the IOU and, separately, for each of the additional listed entities:

Generating plant performance

1. EFORd for the system fleet and nonnuclear fleet for NERC and the RTO, weighted by the IOU's generation capacity per class;

2. EFORd for each of the following generation class categories for NERC and the RTO: fossil all fuel types, fossil coal primary, fossil coal primary 200-599 MW, fossil coal primary 600 MW plus, fluidized bed, combined cycle, gas turbine, and pumped storage;

3. XEFORd for the RTO;

4. EAF for each of the following generation class categories for NERC and the RTO: fossil all fuel types, fossil coal primary, fossil coal primary 200-599 MW, fossil coal primary 600 MW plus, fluidized bed, combined cycle, gas turbine, and pumped storage; and

5. Average heat rates for United States coal (steam turbine) fleet and natural gas (combined cycle) fleet as reported by EIA.

Customer service

1. SAIDI both including and excluding major storms (or major events) for each RTO utility and each MACRUC or SEARUC utility with more than 500,000 customers;

2. SAIFI both including and excluding major storms (or major events) for each RTO utility and each MACRUC or SEARUC utility with more than 500,000 customers; [ and ]

3. ASA or service level both including and excluding calls handled by an IVR for each RTO utility and each MACRUC or SEARUC utility with greater than 500,000 customers [ ;. ]

[ 4. J.D. Power and Associates Electric Utility Residential Customer Satisfaction Study index ranking for the IOU's region and segment; and

5. J.D. Power and Associates Electric Utility Business Customer Satisfaction Study index ranking for the IOU's region and segment. ]

Operating efficiency

1. Total average retail rates for the South Atlantic (as defined by EEI), the United States, and each utility in the proposed benchmark group;

2. O&M efficiency for each utility in the proposed benchmark group;

3. Large coal plant production costs for each utility in the proposed benchmark group; and

4. Combined cycle plant production costs for each utility in the proposed benchmark group.

Additional data

1. Identify the proposed return on equity basis point increase and the revenue requirement impact associated with the proposed performance incentive award;

2. For the biennial period under review, identify [ , to the extent chosen by the IOU, ] the specific actions taken by the IOU to improve generating plant performance, customer service, and operating efficiency and the incremental costs associated with such specific actions;

3. Identify, explain, and quantify to the extent [ possible chosen by the IOU ] the specific benefits (financial and otherwise) that customers received during the previous biennial review period as a result of the specific actions taken by the IOU to improve generating plant performance, customer service, and operating efficiency;

4. Fleet maintenance costs and total electricity generated;

5. Total distribution reliability improvement expense and distribution circuit miles; and

6. Total routine, tree removal, and hot spot trimming expense and miles of right-of-way managed.

(b) In addition to the information required in paragraph (a) of this schedule, IOUs subject to § 56-585.1 A 2 c of the Code of Virginia that own and operate nuclear power plants shall file the following data for the IOU and, separately, for each of the additional listed entities:

1. NCF (nuclear) for the United States nuclear industry and 800-999 MW PWRs;

2. NCF (nuclear) top quartile, median, and bottom quartile over the most recent three-year period (including the two years of the biennial period under review, if available) for the United States nuclear industry and 800-999 MW PWRs;

3. Most recent three-year average (including the two years of the biennial period under review, if available) and ranking by NCF (nuclear) of the top ranked PWR and each of the IOU's nuclear power plant units;

4. Nuclear plant production cost for 800-999 MW PWRs and each of the IOU's nuclear power stations; and

5. NRC ITP indicators for the IOU and nuclear industry (automatic reactor scrams while critical and significant events).

Schedule 49 50 - Additional Schedules

Reserved for additional exhibits presented by the applicant to be labeled Schedule 49 50 et seq.