FTC comments on JPS submission for rate increase

The FTC’s comments focused on JPS’ proposals which are likely to increase the price of electricity to customers.   With regard to JPS’ proposal, the FTC advised that:

  • replacing the current Price Cap regime with a Revenue Cap regime is likely to lessen the incentives for JPS to establish an efficient tariff structure.
  • increasing its residential tariff by 21% on average; (ii) increasing its general service tariff by 15% on average; and (iii) reducing its commercial and industrial tariff by 1.5% on average, is likely to deviate from accepted rules of efficient pricing.
  • introducing a wholesale rate designed to encourage its largest customers to remain entirely on the grid is internally inconsistent with the JPS’ proposal to replace the price cap regime with a revenue cap regime.
  • reducing the rate review period from five years to three years would likely frustrate the ability of the OUR to monitor and evaluate the JPS.