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Utah Administrative Code (Current through November 1, 2019) |
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R746. Public Service Commission, Administration |
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R746-407. Annualization of Test-year Data |
| R746-407-1. Applicability |
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Latest version.
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A. This rule shall apply to each gas corporation, electrical corporation, wholesale electrical cooperative, telephone corporation, telegraph corporation, water corporation, sewerage corporation, heat corporation, and independent energy producer (except independent energy producers exempt from the jurisdiction of the Commission) operating as a public utility in the state of Utah under the jurisdiction of the Commission. This rule will enable the Commission to more accurately coordinate a utility's rates with the utility's anticipated revenues and costs by recognizing that some of the conditions which arise during a test period are ongoing and must be spread over the entire period. |
| R746-407-2. Definitions |
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Latest version.
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For purposes of this rule: A. "Annualize" or "annualization" shall refer to adjustments made to test-year data to reflect the partial-period effects of events that occurred or were ongoing during only a portion of the test year and are either recurring or have terminated. B. "Price-level change" shall mean a change in the utility's costs or revenues that occurs or would occur with no change in the level of the utility's operations. C. "Volume-level change" shall mean a change in the utility's costs or revenues due to changes in the level of the utility's operations. D. "Interdependent investment/revenue/cost relationships" shall mean relationships among investments, revenues, and costs such that a change in one produces a change in one or both of the others. |
| R746-407-3. Criteria |
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Latest version.
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An item of test-year data may be annualized in the determination of a utility's rates if it meets the following criteria: A. Annualization of price-level changes will normally be allowed. B. Annualization of volume-level changes with minimal interdependent investment/revenue/cost relationships will normally be allowed. C. Annualization of volume-level changes with significant interdependent investment/revenue/cost relationships will be considered on a case-by-case basis, and annualization of such changes will not constitute precedent. D. The change must be known to occur at a specific moment or moments in time. E. The effects of the change must be measurable. F. The change must occur on or before the effective date of a final Commission order setting rates. G. The change must be expected to be ongoing after final rates become effective. |