Hillman, PIE&G differ on judge's decision
Patty RamusThe Village of Hillman and the Presque Isle Electric & Gas Co-op have different interpretations of the recent decision issued by Administrative Law Judge Sharon L. Feldman, regarding a natural gas rate case currently before the Michigan Public Service Commission.
For more than a year, PIE&G and Hillman have been unable to reach a consensus on a proposed price structure agreement. In June 2007, Circuit Court Judge John Kowalski ordered the village to go to the Michigan Public Service Commission to reach an agreement with Presque Isle Electric & Gas Co-op. The village has since been in the process of appealing Kowalski’s ruling.
Feldman issued the proposal for decision on April 23.
In a press release issued by PIE&G, President and CEO Brian Burns said he was encouraged by a number of key elements reached by Feldman which supports its case.
“We see this as a positive development which will enable the parties to settle the case in a manner consistent with our initial goals,” he said.
According to PIE&G, Feldman said in the document that the MPSC has the jurisdiction and authority to rule on natural gas rates in Hillman and Allis Township.
“Furthermore, it is appropriate for PIE&G to set rates based upon a reasonable allocation of their system costs and that a times interest earned ratio is reasonable to use in setting natural gas rates,” the press release states. “Finally Judge Feldman encouraged all parties to reach an agreement on a mechanism for adjusting rates to ‘reflect changes in the cost of gas that is consistent with the interests of Presque Isle and the resident of Hillman and Allis.’”
According to a press release issued by the village, Feldman’s document rejected PIE&G’s proposed TIER rate making mechanism, concluding the proposal was not reasonable and prudent. The village opposes the TIER proposal.
The village stated in the release that the document also determined the proposed rate making mechanism does not allow negotiations or review of rates.
“Thus the PFD rejected PIE&G’s attempt to be self regulating. The PFD supports the village’s position that negotiation with the village is required,” it said.
President Myron McIntire said the village continues to oppose any attempt by PIE&G to become self-regulating.
“It is important to the village that it continue to have the rights secured in the franchise granted to PIE&G,” he said in the release. “The village has a vital role to play in negotiating fair and reasonable rates. PIE&G must be accountable to its customers. It would be a dereliction of duty for the village council to simply go along with whatever PIE&G proposes.”
According to the village, the document is not a final decision. The village will file exceptions to the document and point out areas where it disagrees with Feldman’s conclusions. All parties have the opportunity to file exceptions by May 28.
PIE&G said it will continue to review Feldman’s document and is hopeful the parties will be able to work together to address concerns or issues raised in a manner that serves the interest of all its natural gas members.
Patty Ramus can be reached via e-mail at pramus@thealpenanews.com or by phone at 358-5687.
