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South Dakota Public Utilities Commission Meeting
May 31, 2011, at 1:30 P.M. CDT

Room 413, Capitol Building
Pierre, South Dakota

NOTE:  If you wish to join this meeting by conference call, please contact the Commission at 605-773-3201 by 9:00 a.m. CDT on Tuesday, May 31, 2011.  Lines are limited and are given out on a first come, first served basis, subject to possible reassignment to accommodate persons who must appear in a proceeding. Ultimately, if you wish to participate in the Commission Meeting and a line is not available you may have to appear in person.

 NOTE:  To listen to the Commission Meeting live please go to the PUC's Web site www.puc.sd.gov and click on the LIVE link on the home page. The Commission requests persons who will only be listening to proceedings and not actively appearing in a case listen via the web cast to free phone lines for those who have to appear.  The Commission meetings are archived on the PUC's Web site under the Commission Actions tab, Click on "Commission Meeting Archives," to access the recordings.

NOTE:  Notice is further given to persons with disabilities that this Commission meeting is being held in a physically accessible place.  If you have special needs, please notify the Commission and we will make all necessary arrangements.

 AGENDA OF COMMISSION MEETING 

Administration

1.     Approval of the Minutes of the Commission Meeting Held on May 3, 2011. (Staff: Lennis Axdahl)

Consumer Reports

1.     Status Report on Consumer Utility Inquiries and Complaints Received by the Commission.  (Consumer Affairs: Deb Gregg)

Electric

1.     EL11-001     In the Matter of the Petition of Black Hills Power, Inc. to Establish an Environmental Measures Cost Recovery Tariff (Staff Analysts: Jon Thurber, Brittany Mehlhaff, Chris Daugaard, Staff Attorney: Ryan Soye)

On January 25, 2011, the Commission received a petition from Black Hills Power, Inc. (BHP) requesting the Commission approve its new tariff establishing an Environmental Improvement Adjustment (EIA) pursuant to legislation enacted during the 2007 Legislative Session.  SDCL Chapter 49-34A, Sections 97 through 100, authorize the Commission to approve a tariff mechanism for the automatic annual adjustment of charges for a public utility to recover the South Dakota jurisdictional portion of eligible investments in and expenses related to new environmental measures. The statute defines eligible new environmental measures as any environmental improvements required under the Clean Air Act, the Clean Water Act, or any other federal law or rule, or any state law or rule implementing a federal law or rule, or voluntary environmental measures designed to protect the environment. At its regularly scheduled meeting on March 8, 2011, the Commission approved the assessment of a filing fee up to the statutory limit of $50,000. The parties have advised that they expect to file a Joint Motion for Approval of the Settlement Stipulation and associated tariff sheets on or before May 27, 2011.

     TODAY, shall the Commission grant the Joint Motion for Approval of the Settlement Stipulation and approve the rates, terms and conditions stipulated therein?

2.     EL11-007     In the Matter of the Petition for Declaratory Ruling of Black Hills Power, Inc., regarding the Proposed Black Hills Power Wind Project (Staff Analysts: Chris Daugaard, Brian Rounds, Staff Attorneys:  Kara Semmler, Ryan Soye)

On April 28, 2011, Black Hills Power, Inc. (BHP) filed a petition asking the Commission to make a declaratory ruling on whether BHP properly evaluated and determined under SDCL 49-34A-101 through 104, that the proposed BHP Wind Project is: i) reasonable and cost effective considering other electricity alternatives; and ii) an appropriate resource addition to meet BHP's resource or customer needs. SDCL 49-34A, Sections 101 through 104, address the South Dakota renewable, recycled, and conserved energy objective that ten percent of all electricity sold at retail within the state by the year 2015 be obtained from renewable, recycled and conserved energy sources. The objective is explicitly stated to be voluntary. The statutes also provide guidance on qualifying sources of renewable energy and relevant cost considerations of any renewable, recycled and conservation investments. On May 18, 2011, Commission Staff filed a Motion to Dismiss BHP's Petition for failure to state a claim on which relief may be granted and lack of subject matter jurisdiction.

     TODAY, shall the Commission grant Staff's Motion to Dismiss?

3.     EL11-009     In the Matter of the Application of Black Hills Power, Inc. for Approval of its Electric Cost Adjustment (Staff Analyst: Dave Jacobson, Staff Attorney: Ryan Soye)

On April 29, 2011, the Commission received an application by Black Hills Power, Inc. for approval of 2011 Electric Cost Adjustment. The ECA for Black Hills Power was approved in Docket No. EL09-018 (the "EL09-018 ECA"). The EL09-018 ECA consists of two separate adjustments: 1) the Fuel and Purchased Power Adjustment (FPPA); and 2) the Transmission Cost Adjustment (TCA). Each adjustment applies to all rate schedules for all classes of service authorized by the Commission. The annual increase in the cost of service is approximately $1,000,000 or 0.68% higher than the revenue billed to customers during the twelve months ending March 31, 2011. The Company states that overall, the increase to customers is primarily related to increased transmission costs for its system.

     TODAY, shall the Commission approve the 2011 Electric Cost Adjustment?

Natural Gas

1.     NG11-003     In the Matter of the Application of NorthWestern Corporation dba NorthWestern Energy for Authority to Increase its Natural Gas Rates (Staff Analyst: Jon Thurber, Brittany Mehlhaff, Bobbi Bourk, Staff Attorney: Karen Cremer)

On May 20, 2011, the Commission received an application by NorthWestern Corporation dba NorthWestern Energy (NorthWestern) for approval to increase rates for natural gas service in its South Dakota service territory by $4,123,035 annually or 7.20% based on NorthWestern's test year ending December 31, 2010.  The company states that the proposed increase for a residential customer would be $8.31 per month based on an average usage of 63 therms per month. The proposed rates may potentially affect approximately 43,750 customers in NorthWestern's South Dakota service territory.

     TODAY, shall the Commission suspend the imposition of the tariff for 180 days beyond May 20, 2011? AND, shall the Commission assess a filing fee for actual expenses not to exceed $100,000?

One Call

1.     OC10-006     In the Matter of the Complaint Filed by NorthWestern Energy, Huron, South Dakota, Against Scott Olson Digging, Inc., Huron, South Dakota (One Call Executive Director: Larry Janes, Staff Attorney: Kara Semmler)

On September 13, 2010, the Commission received a complaint from NorthWestern Energy (NorthWestern) against Scott Olson Digging, Inc. NorthWestern stated it was not notified by Scott Olson Digging of a pipe Scott Olson Digging damaged while excavating.  Pursuant to SDCL 49-7A-22 a panel was appointed and determined probable cause exists to find a violation of SDCL 49-7A-12 occurred.  The panel recommended one-thousand dollar ($1,000) penalty for the violation.  Neither party requested a hearing and the Board approved the panel's recommendation.  Scott Olson Digging failed to make payment of the penalty.  The Board requests the Public Utilities Commission bring an action in the name of the State of South Dakota for recovery of the penalty pursuant to SDCL 49-7A-28.   

     TODAY, shall the Commission grant the request of the South Dakota One Call Board?

2.     OC10-007     In the Matter of the Complaint Filed by NorthWestern Energy, Huron, South Dakota, Against Scott Olson Digging, Inc., Huron, South Dakota (One Call Executive Director: Larry Janes, Staff Attorney: Kara Semmler)

On September 13, 2010, the Commission received a complaint from NorthWestern Energy (NorthWestern) against Scott Olson Digging, Inc. NorthWestern alleges it was not notified by Scott Olson Digging of a pipe Scott Olson Digging damaged while excavating.  Pursuant to SDCL 49-7A-22 a panel was appointed and determined probable cause exists to find a violation of SDCL 49-7A-12 occurred.  The panel recommended a $5,000 penalty for the violation and further agreed to suspend half of the penalty under specific conditions including prompt payment.  Neither party requested a hearing and the Board approved the panel's recommendation.  Scott Olson Digging failed to make payment of the penalty and the full $5,000 penalty is now due.  The Board requests the Public Utilities Commission bring an action in the name of the State of South Dakota for recovery of the penalty pursuant to SDCL 49-7A-28.   

     TODAY, shall the Commission grant the request of the South Dakota One Call Board?

3.     OC10-008     In the Matter of the Complaint Filed by NorthWestern Energy, Huron, South Dakota, Against Scott Olson Digging, Inc., Huron, South Dakota (One Call Executive Director: Larry Janes, Staff Attorney: Kara Semmler)

On September 13, 2010, the Commission received a complaint from NorthWestern Energy (NorthWestern) against Scott Olson Digging, Inc. NorthWestern alleges excavation occurred prior to the start time on the One Call locate ticket.  Pursuant to SDCL 49-7A-22 a panel was appointed and determined probable cause exists to find a violation of SDCL 49-7A-5 occurred.  The panel recommended a $5,000 penalty for the violation and further agreed to suspend half of the penalty under specific conditions including prompt payment.  Neither party requested a hearing and the Board approved the panel's recommendation.  Scott Olson Digging failed to make payment of the penalty and the full $5,000 penalty is now due.  The Board requests the Public Utilities Commission bring an action in the name of the State of South Dakota for recovery of the penalty pursuant to SDCL 49-7A-28.   

    TODAY, shall the Commission grant the request of the South Dakota One Call Board?

4.     OC10-009     In the Matter of the Complaint Filed by Otter Tail Power Company, Fergus Falls, Minnesota, Against Robert Kohl Construction, Peever, South Dakota (One Call Executive Director: Larry Janes, Staff Attorney: Kara Semmler)

        On November 29, 2010, the Commission received a complaint from Otter Tail Power Company (Otter Tail) against Robert Kohl Construction (Kohl). Otter Tail is alleging that Kohl dug without a locate ticket.  Pursuant to SDCL 49-7A-22 a panel was appointed and determined probable cause exists to find a violation of SDCL 49-7A-5 occurred.  The panel recommended a $1,000 penalty for the violation and further agreed to suspend half of the penalty under specific conditions including prompt payment.  Neither party requested a hearing and the Board approved the panel's recommendation.  Kohl failed to make payment of the penalty and the full $1,000 penalty is now due.  The Board requests the Public Utilities Commission bring an action in the name of the State of South Dakota for recovery of the penalty pursuant to SDCL 49-7A-28.

     TODAY, shall the Commission grant the request of the South Dakota One Call Board?

Items for Commission Discussion

Announcements

1.     The Public Utilities Commission offices will be closed Monday, May 30, 2011, in observance of Memorial Day.

2.     Commissioners will attend the Sioux Valley Energy Annual Meeting on Tuesday, May 31, 2011, at 4:30 p.m., CDT, at Brandon Valley High School, Brandon, S.D.

3.     The next regularly scheduled commission meeting will be held Tuesday, June 14, 2011, at 9:30 a.m., CDT, in Room 413 at the State Capitol Building, Pierre, S.D.

4.     Commissioners and staff will meet with representatives of MidAmerican Energy Co. on Wednesday, June 1, at 10:00 a.m. CDT in Room 413 of the State Capitol Building, Pierre, S.D. to discuss natural gas hedging.

5.     Commissioners will attend the Black Hills Electric Cooperative Annual Meeting on Friday, June 3 at 6 p.m. at the Ramkota Conference Center, Rapid City, S.D.

6.     Commissioners and staff will attend the annual meeting of the Mid-America Regulatory Conference, June 5-8, 2011, at the Ramkota Hotel and Conference Center, Rapid City, S.D.

7.     Commission meetings are scheduled for June 14, and June 28, 2011.

8.     Commissioners will attend the Summer Committee Meetings of the National Association of Regulatory Utility Commissioners on July 17-20, 2011, at the L.A. Live JW Marriott, Los Angeles, Calif.

 

/S/ Cindy Kemnitz
Cindy Kemnitz
Finance Manager
puc@state.sd.us
May 24, 2011