26 Del. Admin. Code § 1002-A-5.0

Current through Register Vol. 27, No. 12, June 1, 2024

Section 1002-A-5.0 - Net Operating Income

5.1 Jurisdictional Summary of Net Operating Income

5.1.1 Complete Schedule 3 providing a jurisdictional summary of net operating income for the historic test year on an actual basis and for the test period.

5.2 Revenues

5.2.1 Complete Schedule 3A showing operating revenues by major revenue category, including other operating revenues and uncollectible operating revenues, for the test year, and for the test period.

5.2.2 Electric, Gas and Water Utilities. For each tariff rate, submit a schedule showing the volume of tariff unit sales for two years preceding the test year, the test year, and the test period. For the purpose of this section, the volume of tariff unit sales means:

Electric - KWH sold

Gas - MCF sold

Water - Gallons sold and hydrant fees.

5.2.3 If test period volumes of sales or tariff units are based on an estimate or forecast, provide a full and complete explanation of the basis and assumptions underlying such forecast, including weather assumptions and any price elasticity effects.

5.2.4 Test period revenues should be fully detailed and explained including all mathematical calculations related thereto. This information should follow Schedule 3A with appropriate adjustments referenced to the amounts shown on Schedule 3A.

5.3 Operating Expenses

5.3.1 Complete Schedule 3B showing operating expenses, by major expense category for the test year and for the test period.

5.3.2 Test period operating expenses should be fully detailed and explained including all mathematical calculations related thereto. This information should follow Schedule 3B with appropriate adjustments referenced to the adjustment amounts shown on Schedule 3B.

5.3.3 Complete Schedule 3C showing test year and test period payroll and employee benefit experience. The expense portion of the total payroll costs should equal the payroll and benefit expense included in the various categories of Schedule 3B.

5.3.4 Complete Schedule 3D for the five highest paid executives showing the most recently approved base salary and itemization of all other compensation (current and deferred) on an annual basis using the most recent actual data publicly available.

5.3.5 Provide a statement of procedures used for determining depreciation rates utilized to compute the depreciation expense claim (Schedule 3B). State whether the utility is basing its depreciation rates on a study conducted for this rate application, or whether the utility is using depreciation rates previously approved by the Commission or implicit in a rate determination approved by the Commission. If the latter, state when the most recent depreciation study was performed, the docket number of the case in which it was submitted, and the numbers and dates of the order or orders approving those depreciation rates.

5.3.6 Provide a schedule showing the current and proposed depreciation accrual rate and expense by individual plant account (if not provided in the detailed supporting adjustments in Schedule 2C.

5.3.7 If a change in depreciation rates is proposed, provide a copy of the most recent depreciation study that is relied on to support the depreciation rates used for the purpose of Schedule 3B.

5.3.8 Complete Schedule 3E providing a test year summary of sales promotion, advertising and miscellaneous sales expenses. Classify advertising expense by purpose, i.e., product or service promotion, service aids, personnel and institutional.

5.3.9 Complete Schedule 3F providing all test year contributions for educational or other charitable purposes which are included in the operating expense totals which applicant seeks to recover from rate payers on. Provide the organization names, a description of the organization, tax status, and reason for inclusion in rates.

5.3.10 Submit a statement listing all test year and test period lobbying fees paid or to be paid influencing legislation both at the state and national levels that the utility seeks to recover from ratepayers. Where a utility employee performed this activity is less than full time, furnish the basis for allocations of payroll and related costs.

5.3.11 Complete Schedule 3G listing test year and test period dues paid or to be paid by the company for social and service clubs that the utility seeks to recover from ratepayer. Include costs paid directly by the utility for any executive or employee recreational or "conference" facilities. Provide the organization name, a description of the organization, tax status, and reason for inclusion in rates.

5.3.12 Complete Schedule 3H providing an analysis of actual and projected rate case expenses. If the utility is using outside consultants and counsel and used a bidding process, provide copies of the utility's request for proposals and all bids received in response. Provide the amount paid to outside consultants and counsel that provided services in the utility's last rate case.

5.3.13 Provide a schedule by major expense category of all the amounts charged or credited from each affiliated company for the test year and the test period. Provide the basis of allocation or basis of charging. State whether there has been a change in allocation method or pricing formula since the last general rate case and, finally, describe the services or products provided in Delaware and the benefits of such arrangements.

5.3.14 Operating Taxes.

5.3.14.1 Complete Schedule 3I to agree with the amount shown on Schedule 3, line 4 titled Total Operating Taxes, for the test year and for the test period.

5.3.14.2 Complete Schedules 3J and 3K in support of the amount of current and deferred state and federal income tax claimed by the utility for ratemaking purposes as reflected in total on Schedule 3I.

5.3.14.3 Provide a statement of the utility's income tax accounting practice with respect to timing differences related to liberalized depreciation, the Asset Depreciation Range System, accelerated amortization and cost of removal and all other timing differences such as employee benefits and taxes capitalized.

5.3.14.4 . Provide a statement of the utility's accounting practice with respect to all federal tax credits applicable to this filing, including a copy of all elections filed with the Internal Revenue Service related thereto.

5.3.14.5 Utilities which "normalize" all or any portion of tax credits must complete Schedule 3L.

5.3.14.6 If the utility is part of an affiliated group of companies and its federal income tax return is filed as part of a consolidated federal income tax return, please provide a statement of the procedure used to allocate the consolidated federal income tax liability, the benefits of the consolidated return, and how those benefits are reflected on the utility's books.

5.3.14.7 Complete Schedule 3M for all other Federal, State and local taxes for the test year and for the test period

5.4 Allowance for Funds Used During Construction (AFUDC)

5.4.1 Provide a schedule showing the following:

5.4.1.1 The AFUDC rate employed by the Commission in the last rate Decision.

5.4.1.2 The AFUDC rate used in each month from the end of the test period in the last case through the end of the test year and test period.

5.4.2 Provide a statement describing the methodology employed to complete the AFUDC rates for all periods of time specified in subsection 5.4.1 above.

5.4.3 Provide a statement fully describing how the AFUDC is applied in the accounting procedures.

5.5 Other Income

5.5.1 Provide a schedule describing the nature and amount of each item of other income for the test year and test period.

26 Del. Admin. Code § 1002-A-5.0

27 DE Reg. 117 (8/1/2023)
27 DE Reg. 890 (5/1/2024) (Final)