Last week, the Minnesota Public Utilities Commission approved an increase to Otter Tail Power’s monthly fixed fee from $8.50 to $9.75. The case wraps up roughly a year after Otter Tail Power submitted its initial proposal. In February 2016, Minnesota-based investor-owned utility Otter Tail Power filed its first rate case since 2010, asking for an overall rate increase of 9.8 percent that would have increased revenue by more than $19 million. Fresh Energy intervened in the case to provide expert testimony challenging the requested customer charge increase, and recommending alternative rate designs.
The next step for Fresh Energy is to work with investor-owned utilities on choosing aggregation levels that help set a clear market for efficient buildings – which, in turn, will drive investment into energy efficiency improvements that cut waste and reduce emissions.
In several recent filings before the Minnesota Public Utilities Commission, Minnesota’s rate-regulated electric and gas utilities have requested changes to the rates they charge customers to recover costs of providing service. Through these and other proceedings, rate design has become a primary focus of utility policy due to its impact on how customers use and pay for the energy they receive. Fresh Energy has provided analysis, testimony, and recommendations in these proceedings to ensure rates encourage energy efficiency and allow fair compensation for onsite generation like solar.
Today, Fresh Energy filed expert testimony in Otter Tail Power’s current rate case at the Public Utilities Commission (PUC), proposing a full revenue decoupling mechanism that could improve energy conservation investments for consumers. Otter Tail Power had proposed increasing the monthly customer charge from $8.50 to $13.30. This monthly charge is largely seen as discouraging energy conservation and energy efficiency because customers will pay the same amount no matter how much energy they use. Fresh Energy instead put forward a decoupling proposal that would help address Otter Tail Power’s concerns around stable revenue streams while allowing for substantial energy efficiency efforts and cost savings by the utility and its customers