Public Utilities Disclosure [Text Block] | 3. Below are descriptions of OTP’s major capital expenditure projects that are expected to have a significant impact on OTP’s revenue requirements, rates and alternative revenue recovery mechanisms, followed by summaries of specific electric rate or rider proceedings with the Minnesota Public Utilities Commission (MPUC), the North Dakota Public Service Commission (NDPSC), the South Dakota Public Utilities Commission (SDPUC) and the FERC, impacting OTP’s revenues in 2020 2019. Major Capital Expenditure Projects Merricourt Wind Energy Center (Merricourt) November 16, 2016 150 November 16, 2016, 2020 June 11, 2019, July 16, 2019 August 2019. April 2019. OTP is earning a return in all three June 30, 2020, 19 December 31, 2020. Astoria Station 2021. November 3, 2017, August 3, 2018 September 26, 2018 March 6, 2019 December 2018 January 2019. May 2019, June 30, 2020, 2020 2021. General Rates Minnesota 2016 March 2017 May 1, 2017. The MPUC’s order also included: ( 1 2 November 1, 2017. North Dakota March 23, 2018 In a September 26, 2018 2017 February 1, 2019, April 2019 January February 2018. South Dakota April 20, 2018 first two October 18, 2018. second March 1, 2019 second January 1, 2018 October 17, 2018 first 2019. May 14, 2019 May 30, 2019 August 1, 2019. October 18, 2018 October 2019 On July 9, 2019 May 30, 2019 first October 18, 2018, October 1, 2019. To ensure rates are appropriately set under the stipulation, the parties agreed to establish an earnings sharing mechanism to share with customers any weather-normalized earnings above the authorized ROE of 8.75%. OTP's annual weather-normalized earnings are reported each year by June 1 9.50% 30 Rate Riders In addition to general rates, OTP has several rate riders in place in each of its state jurisdictional service areas. These rate riders are designed to recover expenses, costs and returns on rate base investments not ● In Minnesota: Transmission Cost Recovery (TCR), Environmental Cost Recovery (ECR), Renewable Resource Adjustment (RRA), Energy Intensive Trade Exposed and Conservation Improvement Program riders. ● In North Dakota: TCR, ECR, Renewable Resource Cost Recovery and Generation Cost Recovery (GCR) riders. ● In South Dakota: TCR, ECR, Phase-In Rate Plan and Energy Efficiency Plan (conservation) riders. Following is a brief summary of recent proceedings of riders in place in each state served by OTP, followed by tables showing revenues recorded under rate riders for the three six June 30, 2020 June 30, 2019 2020 2019. 10 December 31, 2019. Minnesota Minnesota Conservation Improvement Programs (MNCIP) May 1, 2020 2019 2019 not Transmission Cost Recovery Rider 2016 May 1, 2017, two August 18, 2017 On June 11, 2018 July 11, 2018 On November 30, 2018 two two April 1, 2019, April 22, 2020, On May 7, 2020 15 three January 1, 2021 three January 1, 2020. one December 2020 January 1, 2021 January 1, 2021. June 4, 2020 July 6, 2020 July 21, 2020. three three August 14, 2020 August 24, 2020, June 30, 2020, Renewable Resource Adjustment June 21, 2019 December 19, 2019 Fuel and Purchased Power Costs Recovery December 2017 October 31, 2019 2020 January 1, 2020. North Dakota Renewable Resource Adjustment December 31, 2019 November 30, 2019. February 25, 2020 March 18, 2020. 25 10 Generation Cost Recovery Rider May 15, 2019 July 1, 2019. June 10, 2020 2020 July 1, 2020. South Dakota Phase-In Rate Plan Rider May 31, 2019 August 21, 2019 September 1, 2019. June 1, 2020 first September 1, 2020. Rate Rider Updates The following table provides summary information on the status of updates since January 1, 2018 Rate Rider R - Request Date A - Approval Date Effective Date Requested or Annual ($000s) Rate Minnesota Conservation Improvement Program 2019 Incentive and Cost Recovery R – May 1, 2020 October 1, 2020 $ 8,247 $0.00485 /kwh 2018 Incentive and Cost Recovery A – December 27, 2019 January 1, 2020 $ 11,926 $0.00710 /kwh 2017 Incentive and Cost Recovery A – October 4, 2018 November 1, 2018 $ 10,283 $0.00600 /kwh Transmission Cost Recovery 2018 Annual Update–Updated Request R – May 7, 2020 January 1, 2021 $ 10,264 Various 2017 Rate Reset A – October 30, 2017 November 1, 2017 $ (3,311 ) Various Environmental Cost Recovery 2018 Annual Update A – November 29, 2018 December 1, 2018 $ - 0% of base Renewable Resource Adjustment 2019 Annual Update – Revised A – December 19, 2019 January 1, 2020 $ 12,506 $0.00467 /kwh 2018 Annual Update A – August 29, 2018 November 1, 2018 $ 5,886 $0.00219 /kwh North Dakota Renewable Resource Adjustment 2020 Annual Update A – March 18, 2020 April 1, 2020 $ 5,762 5.637% of base 2019 Annual Update A – May 1, 2019 June 1, 2019 $ (235 ) -0.224% of base 2018 Rate Reset for effect of TCJA A – February 27, 2018 March 1, 2018 $ 9,650 7.493% of base Transmission Cost Recovery 2019 Annual Update A – December 18, 2019 January 1, 2020 $ 5,739 Various 2018 Supplemental Update A – December 6, 2018 February 1, 2019 $ 4,801 Various 2018 Rate Reset for effect of TCJA A – February 27, 2018 March 1, 2018 $ 7,469 Various Environmental Cost Recovery 2019 Update A – October 22, 2019 November 1, 2019 $ - 0% of base 2018 Update A – December 19, 2018 February 1, 2019 $ (378 ) -0.310% of base 2018 Rate Reset for effect of TCJA A – February 27, 2018 March 1, 2018 $ 7,718 5.593% of base Generation Cost Recovery 2020 Annual Update A – June 10, 2020 July 1, 2020 $ 6,184 6.041% of base 2019 Initial Request A – May 15, 2019 July 1, 2019 $ 2,720 2.547% of base South Dakota Transmission Cost Recovery 2020 Annual Update A – February 19, 2020 March 1, 2020 $ 2,327 Various 2019 Rate Reset A – September 17, 2019 October 1, 2019 $ 2,046 Various 2019 Annual Update A – February 20, 2019 March 1, 2019 $ 1,638 Various 2018 Interim Rate Reset A – October 18, 2018 October 18, 2018 $ 1,171 Various Environmental Cost Recovery 2018 Interim Rate Reset A – October 18, 2018 October 18, 2018 $ (189 ) -$0.00075 /kwh Phase-In Rate Plan Recovery 2020 Annual Update R – June 1, 2020 September 1, 2020 $ 1,931 7.753% of base 2019 Initial Request A – August 21, 2019 September 1, 2019 $ 864 3.345% of base Revenues Recorded under Rate Riders The following table presents revenue recorded by OTP under rate riders in place in Minnesota, North Dakota and South Dakota. Three Months Ended June 30, Six Months Ended June 30, Rate Rider (in thousands) 2020 2019 2020 2019 Minnesota Renewable Resource Recovery $ 3,088 $ 1,317 $ 6,342 $ 2,633 Conservation Improvement Program Costs and Incentives 1,521 1,841 2,607 2,728 Transmission Cost Recovery (314 ) (56 ) 401 585 Environmental Cost Recovery - - - (1 ) North Dakota Transmission Cost Recovery 840 874 2,322 2,646 Renewable Resource Adjustment 1,070 (93 ) 2,199 636 Generation Cost Recovery 900 222 1,848 470 Environmental Cost Recovery - (12 ) - 563 South Dakota Transmission Cost Recovery 371 371 933 844 Conservation Improvement Program Costs and Incentives 210 96 554 340 Environmental Cost Recovery - (23 ) - (27 ) Phase-In Rate Plan (670 ) - (24 ) - Total $ 7,016 $ 4,537 $ 17,182 $ 11,417 FERC Wholesale power sales and transmission rates are subject to the jurisdiction of the FERC under the Federal Power Act of 1935 MVPs ROE November 2013 February 2015, may June 30, 2020 ● a $0.1 million refund for the first November 2013 February 2015 ● a $1.5 million refund related to the second February 2015 May 2016 ● a $1.3 million refund for the period from September 2016 June 2020 Various FERC orders have been made that remain under appeal. All or some of the current liability will be refunded to customers or reversed and recognized as revenue depending on various factors including MISO’s determination of refund amounts and FERC’s final determination of the reasonableness of base ROE over various periods. |