REGULATION

Shareholder-owned electric utilities filed 22 new general rate cases in the second quarter, breaking the previous record of 21 filings in the third quarter of 2008 and resulting in the most active quarter in decades. Consistent with the trend in recent years, capital investment in infrastructure additions and upgrades, including new generation, was a prominent driver of the quarter’s filed cases. Wind generation accounted for a large part of those investments.

Infrastructure spending has historically been a frequent reason for new filings, yet within the past two quarters economic conditions have also emerged as a factor. Costs related to the economic recession, such as higher cost of capital and higher pension expenses associated with the declining financial asset values, reduced sales, and increased uncollectible accounts, were cited among the quarter’s filed cases.  Several filings also mentioned utilities’ efforts to moderate requested rate increases in order to minimize the impact on customers during this time of economic stress. Other issues mentioned as prompting new case filings included implementation of new tracking mechanisms, reliability improvements, operation and maintenance expenses, and energy efficiency investments.