Vermont utility regulators approved an overall rate increase of $31.9 million for Green Mountain Power Corp. The rate increase is premised upon a 9.1% return on equity.
The Vermont Public Utility Commission's Dec. 21 decision follows a memorandum of understanding between Green Mountain and the Vermont Department of Public Service. The MOU, reached in early November, outlined an agreement that would increase Green Mountain Power's rates by 5.02%, effective Jan. 3, 2018.
Green Mountain Power and the Department of Public Service requested the commission to approve a rate increase that is "slightly higher" than Green Mountain's original request or 4.98%.
The commission agreed to a return on equity of 9.1% for the 2018 rate year but declined a component of the MOU that set the return at 9.3% for the 2019 rate year. The PUC said there was no evidence filed to support the 2019 rate year return and Green Mountain Power intends to file a traditional cost-of-service tariff filing that would take effect in the 2019 rate year.
Green Mountain Power in April filed a traditional rate case for a $31.7 million increase due to increased transmission costs, ISO New England capacity costs and increased net metering expenses. This increase reflected revenues of $10.3 million from the JV Microgrid projects during the 2018 rate year, but those were later eliminated from rate base on the department's recommendation.
The increase is premised upon a 9.5% return on equity (48.63% of capital) and a 7.07% return on a $1.46 billion rate base. The filing was based on Green Mountain's test year 2016 and rate year 2018.
The commission told Green Mountain Power to file tariffs within 10 days of the order.
Green Mountain Power is a subsidiary of Northern New England Energy Corp., which is a subsidiary of Gaz Métro LP. (Case No. 17-3112-INV)