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1. UTILITY FINANCIAL ANALYST Day Keith CHIEF UTILITY FINANCIAL ANALYST IV Melendez Pelis UTILITY FINANCIAL ANALYST III Mike Laurentia 22 ortos ADMINISTRATIVE CLERK II R ssell UTILITY FINANCIAL ANALYST Smith Chris eoo ote sexs UTILITY FINANCIAL ANALYST III Information Systems Staff Joseph Vince MICROCOMPUTER NETWORK TECH II Krieger Christin ANALYST PROGRAMMER II Norton Keith CHIEF ANALYST PROGRAMMER V Public Advocacy Staff Collins Deborah LAW OFFICE ASSISTANT I Craig LOW CHIEF PUBLIC ADVOCACY SECTION DEVIES SIEV ASST ATTORNEY GENERAL Koch Katherine UTILITY FINANCIAL ANALYST III McConnell Tim UTILITY ENGINEER ANALYST IV Nation UTILITY FINANCIAL ANALYST III AIO vas ss a ECONOMIST II Zobel ASST ATTORNEY GENERAL Records amp Filing Staff Macon Leteasha ADMIN CLERK I RECEPTIONIST McGowan Joyce ADMINISTRATIVE SUPERVISOR Magro Holly ADMINISTRATIVE CLERK II Renteria Letitia ADMINISTRATIVE CLERK III Wright Carolyn ADMINISTRATIVE CLERK I Tariff Staff Angner Matthew UTILITY TARIFF ANALYST I Arnett Wendy CHIEF UTILITY TARIFF ANALYST III Gog
2. SPECIAL ASSISTANT HEARING EXAMINER Jennifer LAW OFFICE ASSISTANT I Hammond Pal ss ax PARALEGAL II Olson Paul HEARING EXAMINER Nizich Rosalie PROCESS COORDINATOR RUSCH ASST ATTORNEY GENERAL WV ECS PARALEGAL II Bionic m sam PARALEGAL I Common Carrier Staff Boysen Robin COMMON CARRIER SPECIALIST I Gazaway Richard COMMON CARRIER SPECIALIST III Kenyon Lorraine CHIEF COMMON CARRIER SPEC IV Mora Michael COMMON CARRIER SPECIALIST III Treuer Phil COMMON CARRIER SPECIALIST III Consumer Protection CP Staff Alexander Tamara CP amp INFORMATION OFFICER I Goggins ADMINISTRATIVE CLERK II PAS VOTES CHIEF CP amp INFORMATION OFFICER II Sabrowski Catherine PUBLICATION SPECIALIST II Weaver ROSE CP amp INFORMATION OFFICER I RCA Organization Engineering Staff Burton UTILITY ENGINEER ANALYST II Keen UTILITY ENGINEER ANALYST III Persson Brad CHIEF UTILITY ENGINEER ANALYST V Manaois John Paul UTILTY ENGINEER ANALYST IV Struempf James UTILITY ENGINEER ANALYST III Tauaese Puletapuai Dorothy ADMINISTRATIVE CLERK II Finance Staff Clark
3. 28 28 RES INSTA 28 Telecommunications 29 i Watara Wastewater Event m 29 i a Con sumer Protection 4 mE for mal Complaints 77 Tle BEC 30 lfl T e ts F Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 6 Fiscal year 2002 was the third year of operation for the Regulatory Commission of Alaska RCA It was another year of significant progress for the agency Sif The Regulatory Commission of Alaska significantly reduced the backlog inherited from the Alaska Public Utilities Commission Since the RCA s inception in 1999 we have closed over 700 dockets while opening an average of 175 new dockets each year The number of pending dockets has been substantially reduced and our active caseload is stabilizing at less than 350 dockets Overall the Commission decreased the number of pending cases by 11 percent from fiscal year 2001 To improve the Commission s operations we implemented a computerized management information system designed to improve our efficiency The Commission electronically records all filings submitted to the Commission and links these filings to a daily Mailsheet that is available electronically to the public This system has increased the agency s productivity and allows the public to access data quickly We continue to increase
4. 1997 1999 Da COLLO svenska 1995 1999 ess vs 1994 1999 ase 1993 1999 ACC _ 1993 1999 Bet 199 1997 an tteFnonPsop By 1995 1996 i il Mee 1992 1995 Daniel 1989 1994 Mark Foster Sih 5 8 Mk 1990 1993 Susan M Knowles 9M a 1975 1993 Din May e dee ya 1990 1992 Bate cmokoles 1987 1991 Kathleen BewWitellore ame 1985 1990 KouiS LESE Seas LR 1983 1989 ETOS Cruessss ME g 1975 1989 Marvit N Wemer y ad 1975 1987 Diana E Snowden 5 T ei 4 1981 1985 Stuart C Hall RETE ERE 1976 1983 Gordon J tm OM X 1963 1981 B Richard Edw ids s 4250 1974 1976 James 7 2 757 8 1971 1975 steth BB 1971 1973 Loren HBV WX 1967 1971 James Rs 1967 1971 L t 1966 1966 Harold sa RB i 1965 1966 0 i J 1965 1965 mh A M F A 1964 1965 i afl 1960 1964 Semmes Heert gt 1960 1963 Clyllgsngurtiiboe 7 1960 1963 Regulatory Commissi
5. D MISSION STATEMENT To protect consumer interests by ensuring affordable reliable utility and pipeline services and ensuring that the utility and pipeline infrastructure is adequate to support community needs impr 3 wis W Ene E _ mU FL 1 a TUV VM Chair Thompson center is flanked left to right by Commissioners Abbott Smith DeMarco and Strandberg Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 4 Table of Contents TABLE OF CONTENTS Mission Statement 4 Message From the RCA Commissioners Cre amett j Thompson AC Wath 8 BErnic o Tine irre Nw o E Sos 8 esos d 9 Will ABIDO 4 EU us n ER LO M 9 1 James o Strandberg T 10 Former Commissioners Ee _ a E refuse Event APTE T n Iecomn 1 Lid Dee Water amp Was ewater Events um Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 5 Table of Contents B TABLE OF CONTENTS Public Advocacy 26 Significant Events ElectrpiejEvempsw rrr tl crim 27 28 Naturals
6. 2002 Annual Report 5 Regulatory Con of A 701 West Eighth Avenue Suite 300 Anchorage Alaska 99501 3469 PHONE 907 276 6222 FAX 907 276 0160 TTY 907 276 4533 http www state ak us rca Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 2 STATE OF ALASKA 0 701 WEST EIGHTH AVENUE SUITE 300 DEPARTMENT OF COMMUNITY ANCHORAGE ALASKA 99501 3469 AND ECONOMIC DEVELOPMENT PHONE 907 276 6222 FAX 907 276 0160 TTY 907 276 4533 REGULATORY COMMISSION OF ALASKA WEB SITE http www state ak us rca January 2 2003 Honorable Pete Kott Speaker of the House and Honorable Gene Therriault President of the Senate Dear Speaker Kott and President Therriault On behalf of the Regulatory Commission of Alaska we are pleased to submit to the Alaska State Legislature the Thirty third Annual Report of the Regulatory Commission of Alaska covering the fiscal year ending June 30 2002 This 1s filed pursuant to AS 42 05 211 and AS 42 06 220 Respectfully yours REGULATORY COMMISSION OF ALASKA P uu F F 7 ft Lit fem ER chair AS Arercte Commissioner X ri s um zc M NN Commissioner E so af gc gt left mm Qu f A me FF 4 fo 0 0 MEE A y amp _ F ri ar im V af Zorans Commissioner Mission Statement
7. s purchase of one third interest from Beluga River Gas Field using the rate base rate of return methodology Subsequently the PAS proposed using the Debt Service Coverage methodology which the Commission approved Docket U 96 36 pending oe i Transfer Price of Gas Methodology Argued Municipality of Anchorage d b a Municipal Light amp Power Department Wholesale Rates Determined Chugach Electric Association Inc Chugach Electric Association Inc Chugach proposed rates for its wholesale customers Matanuska Electric Association Inc Homer Electric Association Inc Alaska Electric Generation amp Transmission Cooperative Inc AEG amp T under the terms of the Settlement Agreement The PAS argued that certain costs incurred by Chugach should not be included in the rate and recommended other cost reductions The Commission agreed and ordered the cost reductions Matanuska Electric Association Inc and AEG amp T disputed the cost allocations proposed by Chugach The PAS argued against changing the allocations pointing out the Settlement Agreement specified that allocations were to remain unchanged until a general rate case is filed The Commission agreed and required compliance with the approved Settlement Agreement Docket U 96 37 pending ee Methodology for Line Loss Factor Established Chugach Electric Association Inc Chugach Electric Association Inc Chugach and its wholesale customers disagreed
8. In 2002 the Commission received plans from each of the regulated incumbent ETCs These plans were uncontested and have gone into effect as allowed under federal regulation Docket R 00 01 pending Universal Service Support for Local Service GCI Communication Corporation The Commission granted GCI Communication Corporation GCICC status as an Eligible Telecommunications Carrier ETC in Fort Wainwright Fairbanks and Juneau study areas of Alaska Through the ETC status GCICC is allowed to file and obtain Federal Universal Service Fund support for the provision of local service Docket U 01 11 pending Granted Partial Interim and Refundable Rate Relief Alaska Communications Systems Inc Alaska Communications Systems Inc ACS filed for the first time in ten years a rate increase in the service areas of Anchorage Fairbanks Juneau and Sitka The Commission granted a 24 percent interim and refundable rate increase to allow ACS to earn a reasonable rate of return on their investments Docket U 01 34 pending Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 22 An Arctic Slope Telephone Association Cooperative Inc ASTAC telephone technician splices wires Photo is courtesy of ASTAC Biennial Intrastate Interexchange Access Charge Review Methodology Adopted on a Test Basis On a test basis the Commission adopted a biennial review methodology propo
9. TAPS quality bank proceedings and ordered hearings before a FERC administrative law judge In order to place the Commission s quality bank proceedings in the same procedural status as those of the FERC the Commission reopened Docket P 98 09 consolidated the Commission s quality bank dockets directed that concurrent hearings be held with the FERC and appoint an administrative law judge Hearings in this docket will be held concurrently with FERC hearings regarding the quality bank proceedings in the fall of 2002 Docket P 89 02 pending The Commission approved the transfer of a 3 0845 percent interest in the Trans Alaska Pipeline System pipeline and terminal assets from BP Pipelines Alaska Inc BP to Phillips Transportation Alaska Inc In previous years BP owned approximately 50 percent of the pipeline but currently owns approximately 47 percent Phillips Transportation Alaska Inc ownership has increased from approximately 24 to 27 percent Docket P 01 08 pending Transfer of Ownership Phillips Transportation Alaska Inc Alaska Power amp Telephone Company AP amp T wireless technician Dave Pflaum works on the High Mountain Web Camera Photo is courtesy of AP amp T ANNUAL REVIEW The Public Advocacy Section PAS was established by the Legislature in 1999 to operate independently from the Commission and represent the public interest As a party the PAS investigates all relevant issues presents the re
10. closed Golden Heart Utilities Inc v Regulatory Commission of Alaska Golden Heart Utilities Inc listed numerous points on appeal of the Commission s decisions in its last rate case Case 4FA 02 1444 CI pending Manager of Alaska Power amp Telephone Co AP amp T Wendell Hewes works in the Wrangell Central Office Photo is courtesy of AP amp T Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage 99501 907 276 6222 38 91H CIRCUIT COURT OF APPEALS T ACS of Fairbanks Inc et al v Regulatory Commission of Alaska and GCI Communication Corporation These consolidated appeals arose from Alaska Communications Systems Inc s ACS original action in federal court seeking injunctive and declaratory relief from the Regulatory Commission of Alaska s decisions approving the results of arbitration in Communication Corporation s request for interconnection under the Telecommunications Act of 1996 The issue in Case No 01 35344 is whether by conducting interconnection proceedings under the Telecommunications Act the Commission has waived the state s 11 amendment immunity from suit in federal court In the cross appeal Case No 01 35375 ACS appealed the federal district court s grant of a stay of the entire action pending the 9 Circuit s decision on the 11 amendment issue Cases 01 35344 01 35375 pending STATUTES The Alaska Legislature reorganized and renamed
11. formal proceedings to consider rate changes rule changes special contracts complaints against utilities and pipeline carriers investigations of service quality or management practices and regulations Frequently requests for general rate changes include or necessitate a restructuring of rates Formal proceedings impact the Commission s workload due to considerable time and resources required to audit investigate prepare prefiled testimony conduct public hearings determine and issue decisions and process requests for reconsideration The figure to the right represents categories of formal proceedings excluding certifications Rate related filings continue to dominant the Commission s formal proceedings Prepared by Joyce McGowan Formal Proceedings 1999 2000 Access Charge Filing 21 21 Contracts 2 1 Generic Regulations 5 10 Investigations Complaints T Management Practices Interconnection Eligible Carrier Designation Investigations Other Rate amp Rule Change General Rate Change Rate Restructure Service Equipment Offering 12 Rate Change Other Rule Change Miscellaneous Equal Access Ballots Protected Confidential Status Miscellaneous Other Totals The act involves more than one type of utility 2001 19 6 5 Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 30 ALASKA SUPREME COURT CASES 1 Bi Chugach Electric Associatio
12. 000 972 000 981 000 757 000 Electric 41 455 886 42 773 482 36 904 719 31 188 177 Natural Gas 15 710 652 15 010 521 8 789 246 6 580 788 Refuse 2 817 821 3 885 765 2 632 125 3 497 368 Steam Heat Not reported 2 796 173 1 492 060 1 057 779 Telecommunications 24 105 402 32 992 147 37 839 669 39 501 928 Wastewater 4 067 810 5 016 028 4 088 554 4 058 481 Water 6 224 657 208 994 6 811 516 5 857 628 Total Net Income 95 166 228 101 062 764 97 454 769 90 383 591 Customers Cable Television 9 420 7 822 8 130 8 130 Electric 218 621 225 821 229 306 233 199 Natural Gas 98 220 99 285 103 728 108 487 Refuse 52 116 50 359 51 160 52 315 Steam Heat Not reported 124 159 148 Telecommunications 427 000 534 555 502 815 570 216 Wastewater o 964 62 949 59 219 60 057 Water 58 212 60 586 60 292 60 150 Total Customers 920 953 1 041 501 1 104 785 1 092 702 Figures have been restated to correct compilation errors in summarizing reported data in previous annual reports 2 Cable television is not regulated by the Commission as to rates and services with the exception of GCI Cable in Juneau which is rate regulated for basic tier channels gt Includes local exchange carriers only Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 19 ELECTRIC EVENTS Disputed Settlement Agreement Resolved Chugach Electric Association Inc The Commission issued an order resolving disputes arising
13. 02 Acceptance of Gas Sales Agreement Alaska Pipeline Company E Rate Settlement Cook Inlet Pipe Line 1 Company The Commission approved a multi year rate settlement based on an agreement between the State of Alaska and Cook Inlet Pipe Line Company The Commission accepted filed rates for the periods of 1993 through 1997 rates prescribed by the Settlement Agreement for 1998 1999 and 2000 a settlement methodology whereby rates were calculated for the years of 2001 and 2002 and will be calculated for future years Docket P 92 05 pending E The Commission processed an application from Kenai Kachemak Pipeline Company LLC KKPL for a certificate to construct and operate a gas pipeline from Ninilchik to Kenai The pipeline will transport natural gas from supplies near Ninilchik for delivery to connecting pipelines at Kenai If granted a certificate KKPL will be the first certificated natural gas pipeline under Alaska Statutes 42 06 Docket P 02 06 pending Application for Certification Kenai Kachemak Pipeline Company LLC Figures have been restated to correct compilation errors in summarizing reported data Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 24 Salmon Creek Dam in Juneau generates over 10 percent of the city s hydroelectric power Photo is courtesy of Alaska Electric Light amp Power Company NORTH SLOPE PIPELINE EVENTS The Commission accep
14. 850 1 440 629 200 904 581 438 668 104 686 2 16 0 76 Pipeline Carriers Prepared by Felix Melendez 2000 2001 11 422 190 371 4 169 113 782 11 531 079 380 4 107 233 114 1 307 978 918 306 261 965 1 531 197 148 381 926 530 122 123 334 794 350 768 1 81 2 03 0 42 0 51 This figure above shows the amount of Property and Revenue for regulated pipeline carriers The Throughput of oil has increased 4 and 0 22 per barrel in Gross Revenue from fiscal year 2000 to fiscal year 2001 Cook INLET PIPE LINE EVENTS The Commission accepted the amended Gas Sales Agreement GSA between Alaska Pipeline Company a wholly owned subsidiary of SEMCO Energy Inc of which the ENSTAR Natural Gas Company ENSTAR is a Division of the Union Oil Company of California Unocal ENSTAR filed a tariff advice letter requesting approval of anew GSA between Unocal and ENSTAR The tariff was suspended for six months to allow ENSTAR the opportunity to show that the GSA provisions were in the public interest that a reasonably competitive procurement process was undertaken and to explain the GSA s impact on long term regional gas supply The Commission amended the GSA after reviewing evidence testimony and public comments The GSA serves to provide ENSTAR ratepayers with a reliable supply of reasonably priced gas and creates an incentive for more than one gas producer to remain in Cook Inlet Docket U 01 07 closed 6 10
15. Commission bifurcated the proceeding into two phases The first phase established an appropriate revenue requirement and the second phase established the appropriate rate design for ENSTAR to recover its approved revenue requirement Dockets U 00 88 pending An employee for ENSTAR Natural Gas Company ENSTAR a Division of SEMCO repairs a residential gas meter ona new home Photo is courtesy of ENSTAR Keep Alaska s bears wild handle your garbage responsibly Photo is courtesy of Waste Management of Alaska Inc REFUSE EVENT Consolidation of Refuse Certificates Waste Management of Alaska Inc Waste Management of Alaska Inc WMA a wholly owned subsidiary of USA Waste Management Inc filed to consolidate all refuse utilities owned under a single certificate and tariff The Commission approved WMA s application to merge its refuse public utility operations in Alaska under a single certificate The Commission also approved an application to change the utility s name to Waste Management of Alaska Inc d b a Anchorage Refuse Andersen Services Arrow Refuse Peninsula Sanitation Star Sanitation Service Tongass Sanitation Wasilla Refuse and Williwaw Services The Commission will review the rate impact of this consolidation in 2003 Docket U 00 30 pending TELECOMMUNICATIONS EVENTS Local Competition in Fairbanks and Juneau The Commission prevailed on appeals filed by incumbent carriers who see
16. Regulatory Commission of Alaska Alaska Exchange Carriers Association Inc AECA filed a proposed tariff revision to change the procedure for modifying the first point of switching After receiving written comments regarding the proposed tariff revision the Commission rejected it without holding an evidentiary hearing Alaska Exchange Carriers Association Inc and Alaska Communications Systems Inc appealed the order contending that the Commission could not deny the tariff revision without holding an evidentiary hearing The superior court remanded these to the Commission for an evidentiary hearing Case 3 AN 00 3714 CI pending T Alaska Communications Systems Inc filed in the Alaska Superior Court for the same injunctive and declaratory relief it sought in the federal district court Alaska Communications Systems Inc seeks relief from the local exchange interconnection terms arbitrated in U 99 141 142 143 The Superior Court appeal has been stayed while the same issue 1s litigated in the federal courts Case 3AN 00 3725 CI pending ACS of Fairbanks Inc et al v Regulatory Commission of Alaska and GCI Communication Corporation Court Proceedings GTE Communications Corporation v Regulatory Commission of Alaska GTE Communications Corporation GTE appealed the Commission s order denying petitions to grant confidential status to financial statements filed in compliance with AS 42 05 451 b Case 3AN 00 3733 CI
17. TECH Accounting Technician MCN TECH Microcomputer Network Technician UEA Utility Engineer Analyst AN PROG Analyst Programmer UFA Utility Financial Analyst cc Common Carrier CPIO Consumer Protection amp Information Officer UTA Utility Tariff Analyst PUBL SPEC Publication Specialist ORGANIZATIONAL FLOWCHART Positions funded under contract All positions are located in Anchorage Last revised November 15 2002 ADMINISTRATION ADMIN MGR Vacant 1 Vacant RECORDS amp FILING ADMIN SPVSR McGowan ADMIN CLERK III Renteria ADMIN CLERK II Magro Vacant ADMIN CLERK I Macon Wright 11 Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 RCA ROSTER The Commission 15 divided into nine major sections and employs 61 people with an operating budget of 5 871 300 for the fiscal year 2002 The Chair supervises staff and serves as a liaison between staff and Commissioners and between the Commission and the Legislature Commissioners POD Will so COMMISSIONER DeMarco 1 1 eere sausie tases COMMISSIONER Smith Bernie sd aa an COMMISSIONER Sandberg Jamies si eee COMMISSIONER Thompson G Nanette COMMISSIONER CHAIR Commission Support Staff Beard BIJ sa ances LAW OFFICE ASSISTANT I Bingham Mary Margaret PARALEGAL II Bishop Kleweno Dawn
18. a new bulk water supplier The Commission reopened the evidentiary record and scheduled a videoconference to take additional testimony in Fairbanks and Anchorage regarding the provision of bulk water service The Commission learned that GHU had removed all equipment that would allow continuation of bulk water service at its former location Golden Heart Utilities Inc testified it was not the only available source for bulk water As a result a request was filed by another entity to provide bulk water service The Commission granted a waiver of the certificate requirement and approved the new applicant to provide service Dockets U 00 115 U 00 116 closed 5 21 02 View of Aspund Wastewater treatment facility near Pt Woronzof in Anchorage Photo is courtesy of Municipality of Anchorage d b a Alaska Water and Wastewater Utility Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 32 Consumer Protection a TARIFF FILINGS Tariffs are the written terms conditions rules and rates governing a utility s conduct in providing public utility service They are similar to the bylaws of a corporation In approving a certificate of public convenience and necessity the Commission reviews the applicant s tariff All regulated utilities and pipeline carriers are required to maintain a tariff and to operate under its terms Regulated utilities and pipeline carriers must notify th
19. kept the residential account current Chugach could not disconnect residential service for the outstanding business account However Chugach would disconnect the residential account if it became delinquent Additionally if the residential service was ever permanently disconnected at the customer s request or temporarily disconnected to transfer from one location to another Chugach would require the delinquent business balance to be paid in full as a condition before starting new service In review of the customer s account Chugach found unclaimed capital credits for the business account and together with the customer reached agreement for the unpaid balance that would be paid over the next few years with the proceeds from the capital credit The complaint was resolved to the customer s satisfaction when Chugach agreed to remove the balance that was transferred to the residential account Consumer Protection File C 02 180 closed 4 29 02 Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 31 TELECOMMUNICATIONS EVENT Customers Blocked from Internet Access Summit Telephone amp Telegraph Company d b a Summit Telephone Company Summit Telephone amp Telegraph Company d b a Summit Telephone Company Summit established a two way Extended Area Service EAS between local exchanges in Chatanika Haystack Cleary Summit and Fairbanks through the Basic Exchange Telecommunicatio
20. on how to measure and allocate line loss In fiscal year 2001 the PAS and other parties Chugach Alaska Electric Generation amp Transmission Cooperative Inc Matanuska Electric Association Inc and Homer Electric Association Inc presented a panel of experts to agree upon an approach through the use of a consultant The Commission accepted the consultant s study and all issues have been stipulated with the Commission s approval pending The PAS participated in numerous technical meetings and negotiations Docket U 99 106 pending Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 27 Public Advocacy Inclusion of Fixed Costs in Cost of Power Adjustment Argued Homer Electric Association Inc The Commission opened an investigation into the use of Homer Electric Association Inc s HEA Cost of Power Adjustment COPA to recover the fixed costs of an affiliate Alaska Electric Generation amp Transmission Cooperative Inc The PAS argued against the use of HEA s COPA to recover fixed costs The Commission approved the exclusion and the affiliate s fixed costs will be determined in a pending docket Docket U 00 18 pending Electric Rates Stipulated Golden Valley Electric Association Inc Golden Valley Electric Association Inc GVEA filed revenue requirements cost of service study and a rate design study to justify a rate reduction The PAS reviewed GVE
21. the Northland Inc and ACS of Fairbanks Inc v Regulatory Commission of Alaska and GCI Communication Corporation The Alaska Communications Systems Inc s local exchange companies appealed from the superior court decision affirming the Commission s order terminating the rural exemption under the Telecommunications Act of 1996 Case S 10466 pending Court Proceedings SUPERIOR COURT CASES Chugach Electric Association Inc v Regulatory Commission of Alaska A fier Municipality of Anchorage d b a Municipal Light amp Power Department ML amp P filed an application to provide electric service to a non military customer located on Fort Richardson Army Post the Regulatory Commission of Alaska RCA ruled that ML amp P should list its Army Post customers in its tariff rather than in the service area description 1 its certificate Municipality of Anchorage d b a Municipal Light amp Power Department petitioned for reconsideration and Chugach Electric Association Inc Chugach sought to intervene After extensive briefing the RCA ruled that it has concurrent jurisdiction on the military bases so long as there is no conflict with federal law The RCA held there is no conflict with federal law where no issue of competitive procurement is involved The RCA determined that it would continue to follow the past practice of listing ML amp P s Army Post customers in the service area description of its certificate The superio
22. transfer of 332 478 63 on August 20 1999 and 12 171 32 on November 9 1999 D Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 17 ECONOMIC DEVELOPMENT ite Commission supports economic development through the use of the following three tools to ensure reliable utility services at affordable rates Comparative Information Consumer Protection staff provides public information to consumers about comparative utility services and rates based on filed tariffs Certification Proceedings The Commission issues certificates of public convenience and necessity to qualified applicants that possess the financial technical and management capabilities to stimulate economic development and meet the present and future demands for services Rate Regulation The Commission regulates utilities and pipeline carriers to ensure consumers have reasonable and just rates with fair rates of return to the utilities The Commission considers and approves economic development incentive rates special contracts and promotions that are in the public interest Encouraging rural economic development requires innovative solutions One of the keys 1s the improvement of infrastructure to offer advanced telecommunications and energy services in rural areas Better delivery systems mean a lower cost of power and phone service Once these communities are linked to the communications sup
23. under a Settlement Agreement between Chugach Electric Association Inc Chugach and its two largest wholesale customers Matanuska Electric Association Inc and Homer Electric Association Inc Alaska Electric Generation amp Transmission Cooperative Inc The Settlement Agreement provided for the determination of Chugach s current wholesale rates and the effective rates since 1997 for the two wholesale customers Docket U 96 37 pending Defining the Future Market Structure of Alaska s Electric Industry Through hearings and extensive comments from interested parties the Commission examined the electric utility market structure study that was commissioned jointly with the State Legislature Having considered gathered information and the issues highlighted by the study the Commission found insufficient evidence in the record to show that retail electric competition would be in Alaska s public interest There was no compelling evidence that rates would be lowered and pursuing competition would have required an extensive investment to create a well functioning power market exposing ratepayers to significant risks The Commission decided to continue to monitor the dynamics that influence electric utility policy specifically the natural gas supply and improvements to power transmission up and down the Railbelt and should the Legislature take up policy concerning electric utility restructuring in the future the Commission will strive
24. 0 2002 Dr DeMarco was reappointed by Governor Tony Knowles to serve for six more years She serves on the National Association of Regulatory Utility Commissioners Committee on Consumer Affairs Dr DeMarco previously occupied the position of President of the Anchorage Economic Development Corporation for four years She brings to the Commission a strong interest in utility infrastructure as a mechanism to expand the economic potential of Alaska She has a multi disciplined approach to solving problems and views the role of regulation as a catalyst for change Dr DeMarco came to Alaska in 1995 from Connecticut where her experience included a twenty year career in various aspects of electric utility regulation planning and operation She also started a nonprofit corporation to diversify the defense dependent economy especially the area served by the five utilities in the Connecticut Municipal Electric Energy Cooperative Dr DeMarco received formal education at the University of Pittsburgh She holds a Bachelor of Science and a Doctorate degree in biology and spent seven years in biochemical genetics research Dr DeMarco 1s married with two adult children She serves as Treasurer of the Anchorage Symphony Orchestra and as Secretary of the Anchorage Downtown Rotary Club Commissioner Will Abbott was appointed to the Regulatory Commission of Alaska on July 1 1999 He was reappointed in 2001 for a term expiring March 1 2007 Mr Abbo
25. 2002 the Commission adopted several significant sets of regulations These regulation projects included restructuring long distance telecommunications to protect telephone consumers from slamming the unauthorized switching of a consumer s long distance or local phone service provider adopting rules to clarify how utilities compensate each other for pole attachments and defining the role of the Public Advocacy Section The Commission started several new regulatory projects during the year including drafting a new regulatory framework for small rural water and wastewater utilities and considering revisions to the telecommunications access charge process The 2001 Legislative Audit analysis stated the Commission operates effectively and efficiently and therefore recommended that we continue to regulate public utilities and pipeline carriers for the next four fiscal years After a special session the Legislature extended the agency and operations for one year and adopted deadlines for the Commission to resolve filings Legislators also changed the process for nomination of the Commission chair to allow Commissioners to elect a chairperson every year The Commission is proud of its accomplishments in fiscal year 2002 and will continue to strive to improve the way the agency conducts business Sincerely i AL y r y fel Jn EO uu F i G Nanette Thompson Chair Regulatory Commission of Alaska 701 West Eigh
26. 90 4 E public utility also includes a petroleum or petroleum product distributor when the consumer has no alternative in the choice of supplier of an alternative product or service at an equal or lesser price No entities meeting this definition of public utility are currently certificated or regulated by the Commission 2 The utilities of the Municipality of Anchorage are the only utilities operated by a political subdivision that are currently subject to economic regulation by the Commission m Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 39 6 The RCA also has discretion under AS 42 05 711 d to exempt a utility from all or a portion of AS 42 05 if it determines the exemption is in the public interest The Alaska Public Utilities Commission and the RCA have exercised discretion under this statute to exempt some utilities particularly small water and competing refuse utilities from economic regulation requirements CERTIFICATE OF PUBLIC CONVENIENCE AND NECESSITY Alaska Statutes 42 05 221 requires a public utility to obtain a certificate of public convenience and necessity from the Regulatory Commission of Alaska RCA before commencing service to the public A certificate describes the nature and extent of authority granted to the utility including if appropriate a description of the authorized service area and the scope of operations of the utility Befor
27. A s financial records and applied general rate making principles to reach a settlement agreement with GVEA The result was a 2 6 percent reduction in rates The Commission approved the stipulation and the rate decrease was implemented Docket U 00 93 pending Taken out of service in 1998 this 15 one of two power houses built to generate power that used water from the Salmon Creek Dam Photo is courtesy of Alaska Electric Light amp Power Company Contributions for Line Extensions Chugach Electric Association Inc Chugach Electric Association Inc proposed to reduce contributions to the cost of primary line extensions for residential and commercial construction with the intent to eliminate its line extension credit to new homebuyers The PAS and the Anchorage Homebuilders Association opposed the change The Commission accepted a stipulation among the parties to provide continued contributions at reduced levels Docket U 01 01 pending t Policy on Guaranteed Recovery Argued Chugach Electric Association Inc Chugach Electric Association Inc Chugach filed its first complete general rate case since 1987 The filing included a revenue requirement depreciation study cost of service study and rate redesign Chugach requested a rate increase of four percent The Commission decided some issues in advance of considering the overall rate increases One issue was a request by Chugach to create two regulatory assets by
28. Immediately following the Commission s order GHU filed a second request for an increase in rates which is still pending Dockets U 00 115 U 00 116 U 00 146 closed 5 21 02 U 02 13 U 02 14 pending Alaska Water and Wastewater Utility AWWU replaces old wooden water pipes Photo is courtesy of Municipality of Anchorage d b a AWWU INFORMAL COMPLAINTS nvestigating and resolving complaints has become a vital element in the Commission s public protection role The Commission urges consumers to resolve complaints directly with the utility or pipeline carrier If the matter cannot be settled with the utility or pipeline carrier consumers and pipeline shippers may seek relief from the Commission If Commission Staff determines the complaint results from a violation of a tariff Staff can require the utility or pipeline carrier to conform to the minimum standards spelled out in the tariff Staff will investigate the complaint review the tariff and contact the utility Staff also reviews Commission orders applicable statutes and regulations to determine the Consumer Protection validity of the complaint and then recommend an appropriate course of action Consumers are notified with a summary of the facts and explanation of the recommended resolution Although a vast majority of complaints are resolved informally if consumers are not satisfied with Staff s decision a formal complaint may be filed directly with the Commis
29. NE EVENT Rates for the Trans Alaska Pipeline System Argued The owners of the Trans Alaska Pipeline System affiliates of Amerada Hess Pipeline Corporation have separate transportation tariffs that have been in contention since 1986 The PAS filed several briefs supporting a cost based transportation rate Docket P 97 04 pending The Alaska pipeline Photo is courtesy of Alaska Division of Community and Business Development REFUSE EVENT Revenue Requirement Studies Argued Waste Management of Alaska Inc Waste Management of Alaska Inc WMA filed proposed revenue requirement studies in an attempt to justify rate increases in eight areas they serve The PAS investigated and recommended the studies be rejected due to critical deficiencies At hearing after PAS cross examined WMA s expert witness WMA requested that the Commission allow a withdrawal of filings and to submit new studies using a new test year The Commission approved a stipulation between WMA and the PAS to allow the submission of new test year revenue requirements Docket U 00 30 pending TELECOMMUNICATIONS EVENTS Alaska Communications Systems Inc ACS local exchange companies filed for rate increases in the service areas of Anchorage Fairbanks Juneau and Sitka The PAS filed testtmony of two outside consultants and a PAS witness During the proceeding the PAS ACS and GCI Communication Corporation agreed to stipulate operating expenses and
30. NG BY Camai Printing Company 301 Calista Court Suite B Anchorage Alaska 99518 The annual report was published in accordance with AS 42 05 221 and 42 05 220 by the Regulatory Commission of Alaska Department of Community and Economic Development at a cost of 5 83 per booklet 701 West Eighth Avenue Suite 300 Anchorage Alaska 99501 3469 907 276 6222 www state ak us rca
31. aska Pipeline Commission G In 1999 the Legislature reorganized and renamed the agency to the Regulatory Commission of Alaska and established the Public Advocacy Section to advocate public interests Utility commissions were originally created to protect consumers because most utility services are provided by monopolies Today commissions are faced with the challenge of evaluating regulations and considering policy changes to encourage telecommunications and refuse competition while protecting consumer interests The Regulatory Commission of Alaska RCA strives to balance the utilities and pipeline carriers investment recovery and the public s right to receive quality service at a fair price In doing so the Commission issues certificates of public convenience and necessity to qualified service providers The RCA regulates the rates services practices or facilities of 257 utilities and 16 pipeline carriers in Alaska A service technician with Anchorage Water and Wastewater Utility AWWU works inside a caisson Photo is courtesy of Municipality of Anchorage d b a AWWU Ln i de ec n 0t Menzi muck machine carves out a trench to bury power lines Photo is courtesy of Alaska Electric Light amp Power Company The RCA has specific jurisdiction over the operation of electric utilities natural gas utilities refuse collection water and wastewater treatment
32. astate interexchange market access charge reform and a variety of other matters The review of interexchange market rules includes whether to change the responsibilities of the carrier of last resort within the state and what regulations should apply to the rates and services provided by long distance carriers to consumers and to other carriers The Commission is considering the appropriate manner for incumbent carriers to recover the cost of using the local network to originate and terminate interexchange services as part of the access charge reform review One of the primary issues in the proceeding 1s whether these access costs should be recovered directly from consumers e g through a flat monthly surcharge or should the costs continue to be recovered through long distance rates The Commission 15 evaluating options for streamlining the processes for authorizing long distance carriers to operate in Alaska Such streamlining may improve the agency s efficiency and reduce regulatory burden placed on utilities Dockets R 98 01 R 00 04 R 01 01 pending i Disaggregate Study Areas for Distributing Federal Universal Service Funds The Federal Communications Commission allowed incumbent Eligible Telecommunications Carriers ETC to submit plans for distributing Federal Universal Service Funds within a geographic area in order to better target federal funding to high cost areas and consequently reduce funding to low cost areas
33. atory framework for small and government owned water and wastewater systems Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 Regulated Utilities FINANCIAL OPERATIONS AND REPORTED CUSTOMERS Prepared by Felix Melendez Fiscal Year 1998 1999 2000 2001 Net Plant Cable Television 6 751 000 6 232 000 6 574 000 6 380 000 Electric 1 233 579 201 1 307 506 511 1 361 572 213 1 389 426 622 Natural Gas 179 757 326 180 458 522 186 650 434 180 965 146 Refuse 6 638 960 5 998 254 3 072 122 3 184 025 Steam Heat Not reported 1 776 628 7 991 033 8 484 229 Telecommunications 417 024 290 660 653 316 625 546 641 999 831 476 Wastewater 97 823 582 103 568 947 84 272 842 94 340 320 Water 153 698 530 162 073 055 125 579 941 141 494 274 Total Net Plant 2 095 272 889 2 428 267 233 2 401 259 226 2 424 106 092 Gross Revenue Cable Television 5 372 000 5 811 000 6 189 000 6 563 000 Electric 904 513 606 913 714 260 925 626 713 997 262 581 Natural Gas 100 865 752 110 451 278 99 580 257 117 028 010 Refuse 26 633 726 31 250 540 33 077 014 33 342 330 Steam Heat Not reported 1 414 788 1 540 413 1 895 793 Telecommunications 235 846 988 360 273 600 357 197 021 369 760 452 Wastewater 31 473 874 32 343 760 32 518 942 32 488 857 Water 35 647 884 35 503 989 36 029 727 36 959 311 Total Gross Revenue 940 353 830 1 090 763 221 1 091 759 087 1 155 300 334 Net Income Cable Television 784
34. cConnell back row from left Steve DeVries Katherine Koch and Parker Nation RECORDS amp FILING STAFF Records amp Filing staff manages all of the Commission s public records orders and information requests from staff the public attorneys and utilities Staff processes new filings and documents maintains current and archive filings and posts public documents to the Commission s web site Front row Joyce McGowan back row from left Letitia Renteria Holly Magro and Carolyn Wright E TARIFF STAFF Tarife staff investigates and analyzes tariff filings and presents recommendations to the Commission at bimonthly tariff action meetings Staff coordinates tariff meetings complies with all public notice requirements for tariff filings and maintains current master tariffs for all utilities and pipeline carriers Front row from left Jennifer Meiwes Wendy Arnett Judy Goggins back row from left Brian Beard and Matthew Angner Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 15 2002 OVERVIEW The Commission has worked with the hundreds of public utilities in Alaska with the mission to ensure reliable continued service sound utility management and fair rates for residents in all communities of the state G In 1981 the agency s role was expanded to include oversight of pipeline carriers and pipelines when it merged with the Al
35. chael Mora CONSUMER PROTECTION STAFF C Protection staff interacts with consumers utility personnel members of the media and staff Staff investigates and resolves informal consumer complaints promotes public relations responds to information reguests and may assist Commission staff with formal complaints Staff also educates consumers on utility services and rates and disseminates information to the public and media regarding Commission proceedings Front row from left Rose Weaver Agnes Pitts Tamara Alexander back row from left Catherine Sabrowski and Judy Goggins Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 13 RCA Organization e ENGINEERING STAFF Engineering staff develops and recommends policies concerning utilities for electric natural gas steam heat refuse water and wastewater and pipeline carriers Staff administers rates services and facilities for certificated utilities and pipeline carriers Staff also reviews legal descriptions for service areas plans for plant expansion plant in service schedules and depreciation schedules Staff presents analyses and evaluations to the Commission for adjudication FINANCE STAFF Finance staff analyzes and evaluates utilities and pipeline carriers financial records including cost of service studies Power Cost Equalization and revenue requirements Staff audits utility financial s
36. e Commission of any proposed changes to its tariffs In most cases the Commission must approve tariff revisions before they can take effect The Commission considers most tariff filings at Tariff Action meetings which are held in public bi monthly For certain kinds of utilities the Commission allows proposed tariff revisions to take effect automatically at the end of a thirty day period The most common occurrence of tariff revisions taking effect automatically is with respect to interexchange telecommunications utilities Prepared by Wendy Arnett Percent 0 29 2 11 2 2 47 2 5 100 Tariff Filings Cable Television Electric Natural Gas Pipeline Refuse Steam Heat Telecommunications 299 Wastewater 12 Water 2r Totals The figure above shows the number and percentage of tariff flings by entity The number of telecommunications tariff filings represents 168 filings made by local exchange carriers and 85 filings made by interexchange telecommunications carriers Prepared by Wendy Arnett Tariff Filings 1999 Processed Routinely 560 Suspended 40 Withdrawn Rejected Pending Totals The figure above the comparison of filed tariffs by category Tariff Revisions General Rate Change General Rate Restructure Simplified Rate Filing New Service Equipment Offering Nonrecurring Rate Universal Access Surcharge Regulatory Cost Charge Contracts Fuel gas andpurchased power surcharges Po
37. e issuing a certificate the RCA must under AS 42 05 241 find that the applicant is fit willing and able to provide the service and that the service is required for the convenience and necessity of the public Alaska Statutes 42 05 241 also authorizes the RCA to eliminate undesirable duplication of utility service The RCA has authority under AS 42 05 271 to amend modify revoke or suspend certificates Snettisham Powerplant produces 80 percent of Juneau s electricity Photo is courtesy of Alaska Electric Light amp Power Company Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 40 Legal Authority RATE REGULATIONS The Regulatory Commission of Alaska RCA is responsible for making or requiring just fair and reasonable rates classifications regulations practices services and facilities for public utilities The rate review process prescribed by AS 42 05 361 42 05 441 most often begins with a tariff filing by a utility Within 45 days the RCA approves the filing or suspends it for further investigation The RCA may permit an interim and refundable rate increase If after investigation the RCA finds the proposed rate or term of service unjust and unreasonable the RCA will determine a just and reasonable rate or term of service The RCA also works with the Alaska Energy Authority in administering the Power Cost Equalization program The RCA determines the
38. eived in 2002 would be appropriately used Docket U 01 90 pending New sewer pipes to be installed in Anchorage Photo is courtesy of Municipality of Anchorage d b a Anchorage Water and Wastewater Utility WATER WASTEWATER EVENTS Water Service Expanded to Girdwood Municipality of Anchorage d b a Anchorage Water and Wastewater Utility The Commission approved Municipality of Anchorage d b a Anchorage Water and Wastewater Utility s AW WU application to amend its certificate and expand service into the entire Girdwood area The Commission found AWWU would meet the fire flow needs of a proposed Girdwood Post Office Anchorage Water and Regulated Utilities Wastewater Utility will also offer a viable alternative to an existing small water utility if the utility experiences financial managerial or technical difficulties Docket U 01 35 closed 6 10 02 Consideration of the Regulations for Certificated Small Public Water and Wastewater Systems C The Commission initiated an inquiry into the development of new regulations for small public water and wastewater systems as part of the State of Alaska s responsibility to the U S Environmental Protection Agency to implement the Safe Drinking Water Act The State must demonstrate an effective strategy with control points to achieve statewide technical financial and managerial fitness or available funds could be reduced for Alaska s safe drinking water progra
39. eligibility of electric utilities and the kilowatt hour amount paid under AS 42 45 100 42 45 190 PIPELINE CARRIERS The Regulatory Commission of Alaska RCA also regulates the intrastate transportation services of oil and gas pipelines in Alaska Under AS 42 06 240 42 06 305 the RCA grants certificates of public convenience and necessity for pipeline transportation service and for construction or operation of any pipeline facilities in the state The RCA has authority under AS 42 06 350 42 06 420 to review and determine intrastate service rates and charges of pipelines in the state The RCA is also authorized under AS 31 15 010 31 15 050 to determine if unjust and unreasonable discrimination has occurred in the sale of oil offered for purchase within Alaska ALASKA ADMINISTRATIVE CODE As authorized under AS 42 05 151 and other statut ory provisions the Regulatory Commission of Alaska has adopted regulations to carry out its statutory duties The Commission s regulations are set out in the Alaska Administrative Code at Title 3 Part 5 Chapter 47 Regulatory Cost Charge Chapter 48 Practice and Procedure Chapter 49 Deregulation Chapter 50 Energy Conservation Chapter 51 Telecommunications Relay Service Chapter 52 Operation of Public Utilities and Chapter 53 Telecommunications PHOTO CREDITS The photos presented in this publication are courtesy of the following utilities and businesses G Alaska Div
40. erhighway there will be more local opportunities for economic interaction in the global marketplace Thomas Knight Network Administrator grasps the OC3 fiber patch panel where he will tap light speed Photo is courtesy of Matanuska Telephone Association Inc Fiscal Year Operations 2003 COMMISSION PLAN A helicopter crew replaces old aircraft marker balls on the 69kv transmission line in Juneau Photo is courtesy of Alaska Electric Light amp Power Company The Commission will continue to Review and approve electric rates charged by regulated electric utilities statewide Monitor refuse services statewide and allow competition when it is in the public interest Review rates of existing gas utilities and applications to expand the availability of natural gas heating in the state Resolve disputes over pipeline tariff rates and participate in the process to develop a regulatory framework to operate a natural gas pipeline from the North Slope 5 Fulfill the directives ofthe 1996 Telecommunications Act to allow competition and to provide choices to consumers Support improvements to the statewide network to allow the delivery of affordable high speed data and voice services to all communities in Alaska Coordinate with state and federal agencies to implement the Federal Clean Water Act standards The Commission will complete its effort to design an alternative regul
41. for the greatest public benefit Docket R 97 10 closed 9 28 01 Rate Increase and Methodology Change Chugach Electric Association Inc Afer reconsideration the Commission granted a 3 98 percent interim and refundable rate increase to Chugach Electric Association Inc Chugach and began proceedings to determine appropriate rates and the recovery of environmental remediation costs related to its Cooper Lake Hydro Project and to change from a Times Interest Earned Ratio to a Rate Base Rate of Return methodology of establishing rates The proceeding will constitute the first comprehensive review of Chugach s retail and wholesale rates since 1989 Docket U 01 108 pending Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 20 Regulated Utilities NATURAL GAS EVENT Approved Cook Inlet Natural Gas Supply Contract and Review of Base Rates ENSTAR Natural Gas Company a Division of SEMCO The Commission approved a gas supply contract to help satisfy projected long term supply requirements for the customers of ENSTAR Natural Gas Company ENSTAR a Division of SEMCO to stimulate further Cook Inlet natural gas exploration efforts Docket U 01 07 closed 6 10 02 The Commission investigated ENSTAR s base rates and approved their request to update the revenue requirement to the 2000 test year as a result of the 1999 acquisition of ENSTAR by SEMCO Energy Company The
42. gins Judy ADMINISTRATIVE CLERK II Meiwes Jennifer UTILITY TARIFF ANALYST III Employee of the Department of Law contracted to the Commission Last revised November 15 2002 Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 12 RCA Organization COMMISSION SUPPORT STAFF ls Support staff provides legal and administrative assistance to the Chair and Commissioners The Chair directs these functions with the aid of a special assistant assistant attorney general hearing examiners paralegal support staff and clerical support staff Leteasha Macon Receptionist Olson back row from left Mary Margaret Bingham Jennifer Guigley Anita Hammond and Ann Wilde COMMON CARRIER STAFF C Carrier staff develops and recommends policies concerning local and long distance telephone services cable radio and satellites Staff administers telecommunication rates services and facilities for certificated utilities and presents analyses to the Commission for adjudication Staff also participates on federal state joint boards with the Federal Communications Commission and staff from other States RE LIU qmm ihe A m yam usd DE LIP AD NO lt gt mn 2 LU Front row from left Richard Gazaway Lorraine Kenyon Philip Treuer back row from left Robin Boysen and Mi
43. granting explicit approval for the guaranteed recovery of two specific expenditures The PAS argued against the creation of a regulatory asset in both instances as being contrary to generally accepted rate making The Commission approved the creation of the assets The remainder of the rate increase is being considered in fiscal year 2003 Docket U 01 108 pending NATURAL GAS EVENT Terms of Gas Sales Agreement Argued ENSTAR Natural Gas Company a Division of SEMCO Energy Inc Enstar Natural Gas Company ENSTAR a Division of SEMCO Inc requested approval of the Gas Sales Agreement GSA between Union Oil Company of California Unocal and Alaska Pipeline Company a subsidiary of ENSTAR The proceeding included the price index peaking and transportation fee GSA term and opportunity for arbitrage The PAS argued for an alternative price against the peaking and transportation fees a definition of termination and a means to limit arbitrage The Commission granted the existing terms for price peaking and transportation fees but set limits on the GSA term and Unocal s ability to arbitrage ENSTAR filed Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 28 Public Advocacy revenue requirements without proposed rate changes The PAS supported a decrease of 2 39 and the Commission approved a 1 96 decrease Dockets U 00 88 pending U 01 07 closed 6 10 02 PIPELI
44. ion In total the PAS spent 31 days at hearing The PAS also attended numerous prehearing and discovery conferences before Commission hearing examiners and participated in workshops The PAS regularly participated in settlement conferences to narrow or settle issues and jointly filed stipulations to resolve issues in eight dockets The PAS counsel regularly engaged in motion practice including legal briefs when necessary Currently the PAS is named a party to 39 open dockets that are in various stages of investigation Summary of Regulation Dockets The PAS participated in two regulation proceedings In Docket R 02 02 the PAS proposed to amend existing regulations and add a new section to the Commission s regulations that would define powers and duties of the Public Advocacy Section The PAS petitioned the Commission to adopt the proposed amendments presented argument at a public meeting and filed extensive reply comments The PAS also participated in Docket R 02 03 regarding the proposed rules that govern fuel cost adjustment clauses The PAS filed comments supporting regulations that would allow only costs directly associated with fuel to be passed on to ratepayers In the proceeding the PAS joined in a workshop with Commission staff and utilities ELECTRIC EVENTS 9 Municipality of Anchorage d b a Municipal Light amp Power Department ML amp P proposed to compute the transfer price of gas associated with ML amp P
45. iscal year 2002 appropriation Change 2001 2002 Fiscal Year 2002 Appropriations Personal Services Travel Contractual Commodities Equipment Total Appropriations Expenditures Personal Services Travel Contractual Commodities Equipment Relocation Costs Total Expenditures Revenue Receipts General Fund Program Receipts Total Revenues 2 839 900 35 000 1 525 200 62 500 13 800 4 476 400 2 616 802 42 773 1 373 854 64 623 22 421 O 4 120 473 3 926 597 3 926 597 3 287 000 35 000 1 300 900 62 500 13 800 4 699 200 2 989 089 56 692 1 145 843 77 919 19 689 4 289 232 4 289 232 4 289 232 3 422 400 52 200 1 808 700 62 500 13 800 5 359 600 3 402 786 72 399 1 583 573 48 615 10 589 140 249 9 258 171 5 258 171 5 258 171 3 734 500 55 000 2 005 500 62 500 13 800 5 871 300 3 584 182 38 008 1 821 477 82 997 127 401 5 654 065 5 654 065 5 654 065 The Commission received revenues under various provisions of its statutes including copying and postage charges AS 42 05 201 and cost allocations in proceedings AS 42 05 651 and AS 42 06 610 Revenues from the Regulatory Cost Charge user fee are recognized on the modified accrual method of accounting for fiscal years 2000 through 2002 Fourth quarter revenues are generated as of June 30 but collected in July of the following fiscal year Reporting did not include the
46. ision of Community and Business Development page 28 Alaska Division of Tourism pages 33 34 and inside back cover Alaska Electric Light amp Power Company pages 5 6 16 18 25 26 27 40 and back cover G Arctic Slope Telephone Association Cooperative Inc pages 22 and back cover G Danny Daniels Photography pages 4 7 8 9 and 10 Dept of Fish amp Game Div of Tourism pages 33 34 and inside back cover G ENSTAR Natural Gas Company a Division of SEMCO pages 20 and back cover G Holly Parsons Photography pages 9 13 14 and 15 G Mark S McCready Alaska Power amp Telephone Company pages front cover 21 25 29 35 37 38 and back cover G Matanuska Telephone Association Inc page 18 Municipality of Anchorage d b a Anchorage Water and Wastewater Utility pages 16 23 29 32 and back cover G Rex Melton Alaska Division of Tourism pages 33 34 and inside back cover Waste Management of Alaska Inc pages 21 and back cover ACKNOWLEDGEMENTS The Commission sincerely appreciates the hard work of the Consumer Protection Staff editors G Agnes Pitts Chief Consumer Protection amp Information Officer Tammy Alexander Consumer Protection amp Information Officer G Rose Weaver Consumer Protection amp Information Officer G Catherine Sabrowski Publication Specialist 6 Judy Goggins Administrative Clerk PRINTI
47. k to overturn the Commission s orders to open up local competition in the Fairbanks and Juneau areas U 97 82 143 144 and U 99 141 142 143 litigation is still pending If the incumbent carrier is successful in overturning key Commission decisions in these areas local competition Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 21 Regulated Utilities in rural Alaska markets could be delayed or halted The Commission spent significant resources to review and resolve various disputes and requests concerning carrier to carrier practices and interconnection agreements Dockets U 96 89 U 01 37 U 01 41 U 02 18 pending Designation of Public Interest Pay Telephones The Commission requested applications from eligible providers following the adoption of regulations for the provision of public interest pay telephones in 2000 After final selections are made at least one public pay telephone will be available in each community where a need for service exists The public pay telephones will be subsidized through the Alaska Universal Service Fund Dockets R 97 03 U 01 124 pending Alaska Power amp Telephone Company AP amp T customer representatives make a call Photo is courtesy of AP amp T Consideration of the Reform of Intrastate Interexchange Telecommunications Market Structure and Regulations The Commission continued to review regulations governing the intr
48. m The Alaska Department of Environmental Conservation ADEC is pursuing a Capacity Development Program to improve the operation of small water and wastewater systems The Commission has been working closely with ADEC and other stakeholders to develop a unified strategy to effectively implement the Capacity Development Program so that the U S Environmental Protection Agency s requirements are met while minimizing regulatory redundancies Docket R 02 04 pending Denied Request to Recover Acquisition Adjustment and Approved Cost Based Interim and Refundable Rate Relief Golden Heart Utilities Inc Golden Heart Utilities Inc GHU water and wastewater divisions was denied a rate relief to recover an amount in excess of the price purchased for the systems acquired from Fairbanks Municipal Utilities System U 00 115 116 However GHU was granted an interim and refundable rate relief based on reported increases in actual investment and operating costs for the utility in test year filings Dockets U 02 13 U 02 14 pending a Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 23 FINANCIAL OPERATIONS Fiscal Year 1998 Property Gross Net Revenue 11 143 942 613 4 409 150 310 1 395 820 949 24 463 173 Gross Net Throughput barrels Gross Revenue per barrel Net Revenue per barrel 686 390 088 2 03 0 40 1999 11 167 509 117 4 202 504
49. n Inc v the M Regulatory Commission of Alaska In fiscal year 1997 Chugach Electric Association Inc Chugach attempted to arrange power sales contracts with customers in the exclusive service territory of Municipality of Anchorage d b a Municipal Light amp Power Department ML amp P After which ML amp P filed a complaint with the Alaska Public Utilities Commission APUC After briefing the APUC issued an order prohibiting Chugach from selling power to customers in ML amp P s service territory without obtaining a certificate for that service The Alaska Supreme Court affirmed the APUC order Case S 09692 closed Matanuska Electric Association Inc v Chugach Electric Association Inc In 1997 Matanuska Electric Association Inc MEA complained that the Cost of Power Adjustment COPA for wholesale power it purchased from Chugach Electric Association Inc Chugach was unjust and unreasonable because Chugach used an excessive line loss factor in the computation The Alaska Public Utilities Commission APUC issued U 97 36 13 which required Chugach to recalculate the COPA balancing account for 1995 through 1997 and refund excessive charges to its wholesale customers The superior court reversed the APUC decision and MEA appealed to the Alaska Supreme Court The Regulatory Commission of Alaska filed an amicus curiae brief asking the court to remand the case to the RCA Case S 09839 pending T ACS of Alaska Inc ACS of
50. ns Radio Service BETRS The service allows customers to call on the BETRS system to and from certain communities without incurring long distance charges Summit became concerned when customers found it difficult to place telephone calls due to the congestion caused by increased Internet usage and the limited capacity of BETRS Therefore Summit notified customers and the Commission that it would immediately block EAS access to Internet providers causing customers to pay a long distance charge when they connect to the Internet The Commission received complaints opposing Summit s actions blocking EAS and argued that charges for Internet use violated the Commission s approved stipulation providing for two way EAS Summit was granted an interim EAS blocking of Internet calls and required to report improvements to the BETRS in the Chatanika Haystack and Cleary Summit areas Docket U 02 17 pending WATER WASTEWATER EVENT Bulk Water Service Discontinued in Fairbanks Golden Heart Utilities Inc The Commission granted Golden Heart Utilities Inc s GHU request to discontinue bulk water service to customers in Fairbanks who were not connected to GHU s water system As a result the Commission received informal complaints from GHU s bulk water customers who stated they had no other source of water supply in terms of the water s quality or rates Also customers complained they had not been given adequate notification to find
51. on of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 10 E S e S S O E PUBLIC ADVOCACY CHIEF PAS Craig UFA Nation Koch UEA IV McConnell COMMISSIONER Smith HEARING EXAMINER Clark ASST ATTY GEN Zobel DeVries COMMISSIONER DeMarco CHAIR Thompson HEARING EXAMINER PROCESS COORD Olson Nizich PARALEGAL II Hammond Bingham Wilde PARALEGAL 1 Young COMMISSIONER Abbott COMMISSIONER Strandberg ASST ATTY GEN Rusch LAW OFF ASST I Guigley LAW OFF ASST I Beard SPECIAL ASST Bishop Kleweno COMMON CONSUMER INFORMATION ENGINEERI FINANCE TARIFFS ECONOMIST II aes ns mds CARRIER TARIFE PROTECTION SYSTEMS Scott UEA V CC SPEC IV UFA IV UTA III CPIO II AN PROG V LAW OFFC ASST I Persson Kenyon Day Arnett Pitts Norton Collins UEA IV CC SPEC III UFA III UTA II CPIO I ADMIN CLERK II Manaois Treuer Melendez Meiwes Alexander Vacant Smith Weaver UEA III Gazaway UTA I Struempf Mora Angner PUBL SPEC II Keen UEA II Burton ADMIN CLERK II CC SPEC I Boysen ADMIN CLERK II Vacant UFA II Clark UFAI Russell ADMIN CLERK III Vacant Sabrowski ADMIN CLERK II Goggins 50 SHARED WITH TARIFFS AN PROG II Krieger MCN TECH II Joseph AN PROG Vacant ADMIN CLERK II Mike LEGEND T Puletapuai ADMIN MGR Administrative Manager ACCT
52. r court affirmed in the fiscal year of 2002 the RCA s order holding that the issue Chugach attempted to appeal is not ripe for adjudication Case 3AN 01 8288 CI closed Alaska Power amp Telephone Company AP amp T Metlakatla crew Richard Booth and Kathy Brendible are shown working on a power pole Photo is courtesy of AP amp T a Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 37 ACS of Alaska Inc ACS of the Northland Inc and ACS of Fairbanks Inc v Regulatory Commission of Alaska and GCI Communication Corporation T The local exchange companies now known as the Alaska Communications Systems Inc ACS companies appealed the Regulatory Commission of Alaska s order terminating its rural exemption under the Telecommunications Act of 1996 After the Iowa Utilities Board II decision by the Eighth Circuit Court of Appeals the ACS companies moved for a stay of the Commission s order The superior court denied the stay and the Alaska Supreme Court rejected a petition for review The court also denied ACS motion to vacate the Commission s decision The superior court issued its substantive order affirming the Commission s decision Cases 3AN 98 4759 CI 3AN 98 4903 CI 3AN 98 4905 CI Consolidated Telephone Utilities of Alaska Inc et al RCA Cases 3AN 99 3494 CI 3AN 99 3499 CI Consolidated closed Alaska Exchange Carriers Association Inc v
53. r must obtain a certificate of public convenience and necessity to provide service to the public for compensation The Commission must approve all amendments to or transfers of certificates as well as acquisitions of controlling interest in certificate holders In fiscal year 2002 the Commission processed 63 applications for certificates The figure to the right shows the number of certification proceedings by entity The criteria for issuing certificates is prescribed by law The service must be required for the public convenience and necessity and the applicant must be fit willing and able to provide the service Most small electric utilities in the Power Cost Equalization program applied for certificates prior to fiscal year 1989 Several of these applications are still pending approval because of incomplete financial information or system safety considerations The figure to the right shows the number of certification proceedings by category SUMMARY OF FILINGS A substantial part of the Commission s mission 1s to handle and process tariff filings formal proceedings informal complaints and certification proceedings Each document filed with the Commission is electronically scanned categorized appropriately routed and filed All documents received are posted daily to the Mailsheet Daily Filings and available to the public for viewing on the Commission s website Certification Proceedings Cable Tele
54. re above shows the Commission s docket summary Filings amp Proceedings ORDERS amp DOCKETS The Commission issued 546 decisions or orders in fiscal year 2002 They are categorized into two groups substantive and procedural Substantive orders reflect findings and conclusions based on evidence included in the formal record of the Commission Procedural orders relate to the process and schedule used to handle a case All formal proceedings before the Commission are identified as dockets Dockets are numbered functionally to denote the type of proceeding the year of its initiation and numerical sequence in that year R represents regulatory dockets F am P represents pipeline dockets and F i G U represents utility dockets For example P 01 03 is the third pipeline docket opened by the Commission in the 2001 calendar year All material legal pleadings and decisions are identified by this number and filed in the docket After the Commission has issued a final order the docket is closed Generic refers to regulatory dockets involving more than one type of entity The percentage figures have been restated to correct compilation errors reported in prior annual reports Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 34 CERTIFICATION PROCEEDINGS Every utility with limited exceptions and pipeline carrie
55. ry activities 00 Informal Complaints 234 313 2002 10 350 951 11 301 Billing Practices Quality of Service 44 Rates and Charges 137 Service Availability and Line Extensions 728 Total 6 7 change from fiscal year 2001 The figure to the right shows the number of informal complaints that were opened processed and closed Complaints that were pending during the fiscal year were carried over into Consumer Protection Prepared by Tamara Alexander 1999 Complaints Opened 793 Complaints Closed 818 Complaints Pending 47 start of fiscal year Complaints Complaints Pending 22 end of fiscal year 2000 2001 2002 590 682 128 605 670 719 22 7 19 T 19 28 the next year ELECTRIC EVENT amp Customer Disputes Utility s Billing Practice Chugach Electric Association Inc A customer of Chugach Electric Association Inc Chugach filed an informal complaint with the Commission disputing the utility s billing practice The utility had transferred a delinquent balance from the customer s business account to the customer s residential account Staff investigated the complaint and notified the customer that Chugach could not disconnect residential service for an outstanding business account balance nor could Chugach disconnect service for nonpayment of a bill related to another class of service at a different service location Chugach acknowledged that as the customer
56. sed by utilities that participated in the annual review of intrastate interexchange access charge rates Under this process the local exchange carriers LEC who participate in the annual pooled rate calculation file their revenue requirements in alternating years with approximately half of the LECs filing in a given year The individual utility revenue requirement reported in the prior year would be included in the pooled calculation for those LECs not filing in the current year This methodology is anticipated to provide some overall reduction in costs for the LECs that are required to produce the revenue requirement studies while generally improving the quality of each annual regulatory review by reducing workload compression and allowing for a more detailed review of individual company revenue requirements Docket U 01 49 closed 5 31 02 Appropriate Use of Federal Universal Service Funds by Telecommunications Carriers As a prerequisite for continued receipt of Federal Universal Service Funds the Federal Communications Commission FCC requires the Commission to annually certify whether Eligible Telecommunications Carriers ETC in Alaska will use the funds only for the provision maintenance and upgrading of facilities and services for which the support was intended The Commission reviewed the information concerning the use of federal funds by each ETC in Alaska and on September 26 2001 certified to the FCC that the funds rec
57. sion through the appeal process A formal complaint that is accepted by the Commission for adjudication 1s assigned a docket number and an investigation is instituted into the issues raised in the complaint In fiscal year 2002 six informal complaints appealed Staff s decision and were docketed for adjudication Prepared by Tamara Alexander Complaints Cable Television 1 Electric TT Natural Gas 26 Pipeline Refuse 9 oteam Heat O 638 Wastewater 3 Water 43 Totals Telecommunications The figure above shows the number of informal complaints filed by customers for regulated utilities and pipeline carriers 1999 11 198 298 11 496 2000 9 400 363 9 709 Contact Summary Telephone Conferences Totals The figure above shows the number of telephone contacts and personal conferences handled by the Consumer Protection Staff Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 30 2001 10 366 340 10 706 Telephone Complaints 153 291 13 Rates and Charges 130 Billing Practices Quality of Service Service Availability and Line Extensions 587 Total The data demonstrates that electric and telephone utilities generate the majority of informal complaints received by the Commission This is generally to be expected because these utilities account for the greatest number of customers the largest plant investment and the most frequent regulato
58. steam heat producers telephone companies local and instate services as well as oil and gas pipeline carriers The Commission computes the power costs and resultant state assistance amounts for customers of electric utilities participating in the Power Cost Equalization program The Commission carries out its regulatory responsibilities through several means It conducts audits investigations public meetings Tariff Action meetings informal and formal proceedings and resolves consumer complaints The Commission functions as a quasi judicial body when rendering decisions in formal proceedings and as a quasi legislative body when establishing and enforcing its regulations The statutes and regulations of the state govern the Commission s proceedings and determinations Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 Fiscal Year Operations OPERATING BUDGET In 1992 following the mandate of the Legislature the Commission enacted regulations to recover operating costs through an assessment on the revenues of regulated utilities and pipeline carriers The Regulatory Cost Charge shows up as a recurring surcharge on the monthly billing statements to consumers and shippers The Legislature appropriated and the Governor approved a fiscal year 2003 budget of 6 04 million funded entirely from the Regulatory Cost Charge There are no unrestricted general funds in the f
59. sults of its investigation to the Commission as necessary and may submit stipulations of agreed upon issues for the Commission s approval The PAS staff has the responsibility of participating as a party when named by the Commission and testifying in proceedings before the Commission The PAS generally investigates historical and subject area research of the utility proposal conducts onsite audits of the utility s records discovery and pre filed written testimony and prepares cross examinations of utility witnesses at hearings The PAS may also engage in settlement discussions A remote weather station beams weather reports to Anchorage as part of a statewide reporting system Photo is courtesy of Alaska Electric Light amp Power Company Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 26 Public Advocacy Public Advocacy Staff In fiscal year 2002 the PAS staffed two utility financial analysts utility engineering analyst law office assistant and a section chief Two Assistant Attorneys General provided a combined 150 percent of their time on legal support and representation for the PAS with 50 percent of time devoted to Commission appeals Outside consultants were employed for two cases during the fiscal year Summary of Utility Dockets The PAS staff filed testimony reports or comments in 12 dockets and participated in nine separate hearings before the Commiss
60. t in 1994 and on the Campfire Boys and Girls Board from 1995 to 2000 She and her husband have five children ranging in age from 13 to 27 Commissioner Bernie Smith was appointed to the Regulatory Commission of Alaska on July 1 1999 with a term expiring on June 30 2003 Mr Smith came to the Regulatory Commission of Alaska after serving sixteen years with Tesoro Alaska Petroleum Company While employed with Tesoro he held positions as Manager of Alaska Government Affairs and Special Projects Senior Engineer and Project Engineer In 1973 Mr Smith graduated from Texas A amp M University with a Bachelor of Science degree in Engineering Technology He has been active in several community organizations currently serving as board member of the Chugiak Eagle River Chamber of Commerce and a board member of the State Chamber of Commerce At the time of his appointment Mr Smith was a member of the Alaska Board of Marine Pilots He served as President and board member of the Boys and Girls Club of the Kenai Peninsula and was a board member of Nikiski Fire Service Board Mr Smith has two sons ages 18 and 20 Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 COMMISSIONER PATRICIA DEMARCO RCA Commissioners COMMISSIONER WILL ABBOTT Commissioner Patricia M DeMarco Ph D was appointed to the Regulatory Commission of Alaska on July 1 1999 with a term ending June 3
61. tatements examines historical operating year data and pro forma financial adjustments for all certificated utilities and pipeline carriers y NFORMATION SYSTEMS STAFF Information Systems staff develops computer programs for the agency s operations educates staff on software programs and provides computer support to the Commission Staff also maintains the Commission s web site and works to automate parts of the Commission s processes Front row from left James Keen Dorothy Tauaese Puletapuai Brad Persson back row from left James Struempf John Paul Manaois and Jerry Burton Front row from left Chris Smith Tyler Clark Keith Day back row from left Felix Melendez and Buell Russell Vince Joseph and seated Christin Krieger Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 RCA Organization 5 B PUBLIC ADVOCACY STAFF ra ee ee ee ee ee ee ee a E Public Advocacy staff provides the Commission with A einem mm sek a third party perspective in proceedings to advocate P inp EHHH public interest The Commission assigns cases to the y Public Advocacy Section to investigate and participate in proceedings for utilities and pipeline carriers Staff audits records engages in settlement discussions and presents findings with testimony to the Commission E ua Front row from left Deborah Collins Lew Craig Tim M
62. ted the rate settlement for the 2001 transportation rates based on a Settlement Agreement between the State of Alaska and Alpine Transportation Company The agreement prescribes a methodology under which the pipeline carrier must file rates at or below the maximum calculated rate Docket P 00 15 pending Transportation Rate Settlement Agreement Alpine Transportation Company Pipeline Certification BP Transportation Alaska Inc The Commission granted on an interim basis a connection permit to BP Transportation Alaska Inc to connect the Northstar Oil Pipeline to the Trans Alaska Pipeline System at Pump Station No 1 The Commission will grant a final permit if specific terms and conditions of the connection are found reasonable Docket P 01 06 pending Pipeline Certification Milne Point Pipeline Company The Commission granted on an interim basis a connection permit to Milne Point Pipeline Company to connect to the Oliktok Pipeline Company The Commission will grant a final permit if specific terms and conditions of the connection are found reasonable Docket P 01 07 pending Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 25 Pipeline Carriers TRANS ALASKA PIPELINE SYSTEM EVENTS Reopened Quality Bank Proceedings Trans Alaska Pipeline System Carriers The Federal Energy Regulatory Commission FERC consolidated its Trans Alaska Pipeline System
63. th Ave Suite Anchorage AK 99501 907 276 6222 CHAIR G NANETTE THOMPSON RCA Commissioners COMMISSIONER BERNIE SMITH Chair G Nanette Thompson was appointed to the Regulatory Commission of Alaska on July 1 1999 with a term expiring June 30 2004 Ms Thompson served on the Alaska Public Utilities Commission from 1995 to 1996 Ms Thompson is admitted to the practice of law in Alaska since 1983 and Washington since 1982 She has seventeen years of experience as a lawyer in private practice representing business and individual clients and as an Assistant Attorney General for the State of Alaska After graduating with honors in International Relations from Stanford in 1978 she earned her law degree from the University of Washington in 1982 Ms Thompson is an active member of the National Association of Regulatory Utility Commissioners Committee on Telecommunications and was appointed to the Board of Directors in October of 2002 for a two year term She was appointed by the Federal Communications Commission FCC to serve on the Federal State Joint Conference on Delivery of Advanced Services in November 1999 and served as State Chair from 1999 to 2001 She was appointed by the FCC to the Universal Service Joint Board in August 2000 and was elected State Chairin 2001 Ms Thompson is active in community activities She served on the Salvation Army s Booth Home Advisory Board from 1989 to 1994 acting as Presiden
64. the Commission to the Regulatory Commission of Alaska RCA in 1999 as the state agency responsible for regulation of utilities and pipeline carriers The RCA exists as an independent agency within the Department of Community and Economic Development under AS 42 04 010 Other provisions in the same chapter of AS 42 04 establish the RCA s structure provide for the appointment and terms of commissioners and the employment of staff specify powers and duties of the chair and describe decision making procedures for the RCA The RCA has authority to investigate hold hearings prescribe systems of accounts require the filing of reports adopt regulations and take other lawful actions necessary to accomplish the stated purposes of the Alaska Public Utilities Regulatory Act AS 42 05 and the Pipeline Act AS 42 06 The RCA s principal regulatory functions are certification and economic regulation 3 AAC 48 820 43 which includes regulation of rates quality of service management practices and consumer complaints Legal Authority The RCA has jurisdiction over public utilities providing electric telecommunications interexchange local exchange and cable television steam heat water and wastewater natural gas and refuse The term public utility 1s defined in AS 42 05 990 4 to mean in general an entity that provides any of these utility services to ten or more customers for compensation or that sells wholesale service to a
65. the amount and type of information available on our website In fiscal year 2003 the Commission will begin to incorporate the statutory deadlines and reporting requirements established by the Legislature at the end of the last session We held several significant hearings including proceedings on rate change requests from Golden Heart Utilities Inc College Utilities Corporation Alaska Communications Systems Inc ENSTAR Natural Gas Company a Division of SEMCO and Chugach Electric Association Inc As with all rate cases we review economically regulated utility s rates to allow providers to recover reasonable costs while protecting consumers interests The telecommunications industry has seen dynamic changes occur at a national level and in our own Alaskan market The Commission continues to be actively involved in the federal regulatory process advocating for the interests Message From the Chair of Alaskan telecommunications carriers that deliver services to high cost areas with federal support By our efforts to balance the Telecommunications Act s dual goals of competition and universal service we assure that Alaskans have affordable and reliable telecommunications options During the fiscal year the agency submitted a successful application to the U S Department of Agriculture for a grant program to spread broadband Internet access to Alaskan communities not yet connected to the Internet In fiscal year
66. to include profits in the rates A five day hearing was held on depreciation expense the largest single expense included in rates Dockets U 01 34 U 01 82 U 01 83 U 01 84 U 01 85 U 01 87 pending Local Exchange Rates for 75 Percent of Ratepayers Statewide Argued Alaska Communications Systems Inc Rural Exemption for Wireless Service Examined Alaska Power amp Telephone Wireless Inc Alaska Power amp Telephone Wireless Inc filed an application to provide local wireless service in Ketchikan The Commission requested information to evaluate the applicability of the rural exemption The PAS filed a legal brief regarding rural exemption issues and the utility s requirement to meet eligible telecommunications carrier laws under the Telecommunications Act of 1996 Docket U 01 109 pending E ot F da O Alaska Power amp Telephone Company AP amp T technician Celinda Hanson is with the Power Division of Wales Island Photo is courtesy of AP amp T Regulatory Commission of Alaska 701 West Eighth Ave Suite 300 Anchorage AK 99501 907 276 6222 29 Public Advocacy WATER WASTEWATER EVENT Rate Increases Argued Golden Heart Utilities Inc Golden Heart Utilities Inc GHU filed revenue requirements and rate design studies for a proposed rate increase The PAS countered with several proposed reductions The Commission agreed with most of the PAS reductions in cost and issued an order
67. tt previously worked for the Alaska Housing Finance Corporation Municipality of Anchorage a local environmental firm and 1s retired from the United States Air Force Mr Abbott is married and has two sons Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 COMMISSIONER JAMES S STRANDBERG Commissioner James S Strandberg was appointed to the Regulatory Commission of Alaska on July 1 1999 and reappointed in 2000 for a six year term A life long Alaskan Mr Strandberg has twenty nine years of experience as a Professional Engineer Born in Anchorage he attended the University of Alaska Fairbanks and received a Bachelor of Science degree in Mechanical Engineering in 1970 and a Masters of Science in Arctic Engineering in 1983 Mr Strandberg is a registered mechanical and civil engineer in Alaska and has worked in rural and urban areas in his professional practice Early in his career Mr Strandberg worked on the design team for the Trans Alaska Pipeline and was stationed 1n Anchorage Fairbanks and Houston Texas As a Mechanical and Utilities Designer he worked in private practice designing heating ventilating and air conditioning district heating and power plant systems Married for 30 years Mr Strandberg and his wife have two grown children RCA Commissioners FORMER COMMISSIONERS Commissioner Service Date James M
68. utility serving ten or more customers However AS 42 05 711 provides statutory exemptions from economic regulation and in some cases from the certification requirement for certain kinds of utilities 1 Under AS 42 05 711 b public utilities owned and operated by a political subdivision of the state are exempt from economic regulation unless the political subdivision elects to be regulated by the RCA However if any utility of a political subdivision is in competition with any other utility then all that political subdivision s utilities are regulated 2 Under AS 42 05 711 e electric and telephone utilities with gross revenues less that 50 000 are exempt from both certification requirements and economic regulation unless 25 percent of their customers petition for regulation 3 Under AS 42 05 711 1 refuse utilities with annual gross revenues of 300 000 or less are exempt from economic regulation unless customers that pay 25 percent of the utility s gross revenues petition the RCA for regulation under AS 42 05 712 h 4 Under AS 42 05 711 k cable television utilities are exempt from economic regulation unless subscribers petition the RCA for regulation under the procedures in AS 42 05 712 5 Under AS 42 05 711 f g and h customers of various kinds of utilities may vote for exemption from regulation by the RCA under the procedures in AS 42 05 712 Under AS 42 05 9
69. vision Electric Natural Gas Pipeline Refuse steam Heat NM OC Telecommunications Wastewater Water Totals Certification Proceedings Acquisitions Amendments New Certificates Certificate Transfers Exemption from Certification Discontinuation of Service 1 Temporary Operating 3 Authority Other 8 Totals 87 Filings amp Proceedings Prepared by Joyce McGowan Aerial photo of Haines Alaska Photo is courtesy of Alaska Power amp Telephone Company Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 35 Filings amp Proceedings Prepared by Tamara Alexander Wendy Arnett and Joyce McGowan Tariff Filings Formal Utility Type Proceedings Informal Certification Complaints Proceedings Cable Television 3 O Electric 72 Generic Natural Gas 19 Pipeline O Refuse steam Heat Telecommunications Wastewater Water Totals The figure above illustrates the distribution of the Commission s workload for filings made in 2002 The table does not include Commission obligations arising from government actions or from initiatives taken by the Commission Telecommunications represents 168 filings made by Local Exchange Carriers and 85 filings made by Interexchange Telecommunications Carriers FORMAL PROCEEDINGS In addition to tariff and certification filings the Commission institutes
70. wer Cost Equalization filings and nonfirm power purchase rates Rule Change Miscellaneous Promotions Totals Percent Change The figure above shows the number of requests for tariff changes by category Each request is counted only once regardless of the number of proposed tariff changes it includes n previous annual reports some filings now shown in this category were classified as Miscellaneous The General Rate Change category does not include simplified rate filings There were no Power Cost Equalization PCE base rate changes for 2000 one PCE funding level change in 2001 and two PCE funding level changes in 2002 n previous annual reports Promotions were counted under Miscellaneous Regulatory Commission of Alaska 701 West Eighth Ave Suite Anchorage AK 99501 907 276 6222 33 Prepared by Joyce McGowan Orders Issued 1999 509 144 653 Substantive Procedural Totals The figure above illustrates the number of orders issued by category Orders Issued Substantive Procedural Cable Television 6 Electric 99 Generic o4 Natural Gas 12 Pipeline 62 Refuse 35 224 Wastewater 2 Water 24 Totals Telecommunications O O O O NO Co The figure above shows the number of orders issued by entity in fiscal year 2002 Docket Summary Dockets Opened Dockets Closed Dockets Pending start of fiscal year Dockets Pending end of fiscal year Percent Change The figu

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