1. Regulatory-Utility Dispute Settlement Process Dennis J. Buckley Office of Administrative Law Judge Pennsylvania Public Utility Commission

2. Formal Complaints The filing of a formal complaint entitles the complainant to a formal hearing before the Commission except that the Commission may dismiss any complaint without a hearing if, in its opinion, a hearing is not necessary in the public interest. 52 Pa. Code § 5.21(d).

3. Common Complaints Billing disputes - incorrect amount or “inability to pay” cases “Adequacy of service” disputes Landlord-tenant disputes (NOTE: Not within PUC jurisdiction) “Complaints” associated with rate cases are handled differently.

4. Process A formal Complaint, downloadable from the PUC website, is filed with the Secretary of the Commission. – May be a new Complaint or an appeal from a decision by the Bureau of Consumer Services – Complaint is served on the utility by the Secretary – Utility files an Answer to the Complaint – Utility may also file a Preliminary Objection seeking to have the Complaint dismissed

5. Process (cont.) If Complaint does not go to Mediation, or if Mediation is not successful, then the case is heard by an Administrative Law Judge (ALJ). – Hearing may be in person or telephonic – Complainant has the burden of proof – After the hearing, the ALJ issues an Initial Decision which is served on the Complainant and the utility. – Either party may filed “exceptions” to the decision

6. Process (concluded) All Initial Decisions may be subject to Commission review. – If exceptions are filed, the Commission will review the Initial Decision and the exceptions. – If exceptions are not filed, the Commission may still review the Initial Decision, at its discretion.

7. PA Electric Company Service Areas

8. PJM Interconnection

9. Base Rate Cases The pricing methodology for utility service regulated by the Pennsylvania Public Utility Commission is focused on costs related to the distribution system, not the cost of the commodity. The utility may only charge those rates published in its PUC approved, publicly filed tariff.

10. Base Rate Cases (cont.) Tariffed rates are established as the result of a base rate case filed with the Commission. Typically, the effect of the rate increase is suspended while the Commission holds public hearings before an ALJ to determine the justness and reasonableness of the proposed rates. The Office of Consumer Advocate (OCA), the Office of Small Business Advocate (OSBA), and the PUC Office of Trial Staff all represent the “public interest” in these cases.

11. Base Rate Cases (cont.) The utility, which files the case and the related tariff, is represented by its own counsel. Large industrial customers typically join together to hire counsel. “Public input hearings” are held at various locations to allow members of the public to express their opinion about the proposed rates.

12. Base Rate Cases (cont.) Base rate cases are filed at the discretion of the utility. Given the time and expense of base rate cases, utilities generally do not file these until compelled by economic necessity. This can lead to “rate shock,” for consumers. – The base rate case (or general rate case) focuses on a period of time called a “test year,” which is a 12 month period used to calculate the revenue requirements to cover the utility’s distribution system non-gas costs. In essence, the case: – Establishes the Revenue Requirement – Assigns Costs to Customer Classes – Designs Rates to Collect Revenue Requirement by Class

13. Base Rate Cases (concluded) Consumer “complaints” or dissatisfaction with utility rates, terms and conditions of service are usually dealt with in rate case proceedings. “Vulnerable” customers, such as low-income customers, are represented in rate cases by the Office of Consumer Advocate and by organizations that specialize in low-income advocacy.

14. Questions? Dennis J. Buckley Pennsylvania Public Utility Commission Office of Administrative Law Judge (717)346-9396 debuckley@state.pa.us