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Docket No. 20170179 -GU <br />Florida City Gus <br />approximately 108,000 residential, commercial and industrial natural gas customers in Florida's <br />Miami -Dade, Brevard, St. Lucie, Palm Beach, Glades, Hendry, Broward, and Indian River <br />counties. <br />I, REQUEST FOR PERMANENT RATE RELIEF <br />4) FCG filed its last rate case in 2003 and its current rates were established in Docket No. <br />20030569 -GU, by Order No. PSC -2004 -0128 -PAA -GU, issued February 9, 2004, using a test <br />year ending September 30, 2004. The case was handled as a Proposed Agency Action <br />proceeding under Section 366,06(4), Florida Statutes. The outcome of that case was that the <br />Commission determined that FCG's rate base for the projected test year was $119,897,447. The <br />Commission then granted the Company a revenue increase of $6,699,655 with a return on <br />common equity ("ROE") midpoint of 11.25%. <br />5) Since that time, FCG has maintained its focus on the customer as reflected by its service <br />quality, while also effectively managing its costs such that it has been able to avoid seeking a <br />base rate increase for nearly 14 years. As set forth in the testimony and exhibits of FCG's <br />witnesses, cost saving measures, such as becoming a part of the AGLR shared services model <br />and FCG's deployment of various technology solutions, have created significant operational <br />efficiencies that have helped the Company maintain its rates at the same level over this extended <br />period. The Company has seen, however, an increase in its cost to serve customers, which has <br />contributed to its declining rate of return. At present, the Company's current rates and charges <br />no longer allow it to earn a fair and reasonable rate of return nor do they yield reasonable <br />compensation for services provided, which FCG is entitled to under Section 366.06(3), Florida <br />Statutes. As of June 2017, FCG was earning an overall rate of return of 4.86% on a pro forma <br />adjusted basis with an ROE of 7.91%, excluding the AGLR acquisition adjustment and <br />---._. - ---...-- - - - — - — 3 I p a g e <br />I : L4-4 <br />