PU&C division to review Provgas fine formula

The Division of Public Utilities and Carriers will reconsider the
formula it used when ordering Providence Gas Co. to reimburse six
natural gas suppliers nearly $300,000 earlier this year. It also agreed
to drop five of 23 fines levied against the company for violating
marketing rules.
Providence Gas filed a petition on Sept. 28 asking the Division to
reconsider its Aug. 31st decision in a case involving complaints filed
by Aurora Natural Gas of Dallas.
Stephen Scialabba, the Division official who presided over the hearings,
said Providence Gas objected to the financial penalty, because it was
ordered to reimburse all money paid to it by six supply companies to
transport natural gas to a certain category of commercial gas customers.
Division officials ruled that Providence Gas had allowed some customers
to sign up for service without having the required meters installed, but
didn’t give competitors enough time to take advantage of the same
exemption.
“They (Providence Gas) said, ‘Hey, now you’re giving them free gas, now
you’ve gone overboard,'” Scialabba explained. “They said it was not
unduly discriminatory, that they (the supply companies) received the
service they paid for.”
In a nine page order released last Tuesday, Division officials indicated
they would grant the request for reconsideration and rehearing “for the
limited purpose of reconsidering the amount of restitution originally
ordered to be made to Aurora and the other FT-2 marketers.” The order
also states that “the Division finds no new or compelling reason to
reconsider its initial determination that (Providence Gas’s) offering of
non-operational FT-1 service resulted in a form of rate discrimination.”
Also, the Division rescinded $5,000 in fines against Providence Gas
stemming from newspaper advertising and other marketing efforts that
were believed to be in violation of rules established by the Public
Utilities Commission. Scialabba said “we felt on reconsideration they
(the marketing rules) are vague enough” that there would be room for
interpretation.
The Division will ask PUC officials to clarify those rules.
Providence Gas must still pay 18 other fines totaling $18,000 for
alleged marketing violations. It can, however, file an appeal of those
fines in Superior Court.
A follow up hearing with officials from Providence Gas and Aurora had
not been scheduled as of last Wednesday.
A spokesman from Aurora could not be reached last Wednesday morning.
The case appears to be among the first asking state regulators to handle
complaints against an incumbent, regulated utility company by an
unregulated energy marketing firm, which has been trying to enter a
market recently opened to competition through deregulation. When the
original 90-page decision was released in August, PUC Chairman James
Malachowski said the order sent the message that Rhode Island utility
regulators would take action on allegations of improper conduct between
regulated and unregulated companies.