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Docket No, 20170179 -GU <br />Florida 00Gas <br />Commissiori allow the Company an overall rate of return of 6.32 percent, including a mid -point <br />ROE of 11.25 percent. The resulting revenue deficiency is $15:8 million. When the additional <br />revenue requirement of $3.5 million associated. with moving the Safety, Access, and Facility <br />Enhancement program ("SAFE") installments into rate base is included, as contemplated by <br />Commission order and as further discussed herein, this results in a total revenue increase request <br />of $19.3 million. It should, however, be noted that moving the SAFE investments into rate base <br />is ultimately revenue neutral to the Company as it is also proposing to make a corresponding <br />adjustment to the current SAFE surcharge. The details regarding FCC's rate base, O&M <br />expense, and the key drivers; as noted below; are included in the testimony and exhibit of FCC's <br />witnesses and clearly demonstrate that the Company will be unable to recover the costs of <br />,providing safe and reliable natural gas service for its customers through current rates. <br />8) As further set forth in the testimony and exhibits of FCG's witnesses, there are three key <br />drivers for FCG's request in this proceeding: (1) capital investments to enhance the safety and <br />reliability of FCC's distribution system; (2) capacity challenges; which have prompted FCG to <br />develop a liquefied natural gas ("LNG") strategy; and (3) the challenges associated with an aging <br />workforce and the costs associated. with .proactively addressing the pending skills and knowledge <br />gap. Signif cant investments have been made by FCG to its system in response to federal <br />regulatory changes regarding safety of natural gas facilities. FCG has also made investments to <br />improve the reliability of its system and to enhance the ability of its employees to access <br />facilities for maintenance and repairs, as well as to extend facilities to provide natural gas service <br />to customers who would otherwise be -unable to obtain such service. As further addressed <br />herein, and in the testimony and exhibits of FCC's witnesses, the Company is also faced with <br />capacity challenges that it proposed to address through a two-pronged approach involving the <br />_....—. – - <br />5 1 P a g e <br />