Annual report, 1981

AI
't 'l
I7I b
OFFICE OF THE CONSUMERS' UTILITY COUNSEL OF GEORGIA
Received SEP 13 1982
DOCUMENTS
UGA LIBRARIES

1981 ,/ANNUAL REPORT ~ OF THE
..-.
CONSUMERS' UTILITY COUNSEL OF GEORGIA

TABLE OF CONTENTS
INTRODUCTORY LETTER I. CREATION AND PURPOSE OF THE OFFICE II. BUDGET III. CASE ACTIVITIES DURING 1981
Electric Cases Telephone Cases Gas Cases Transportation Cases Other Cases IV. CONSUMER EDUCATION V. ADVISORY COMMITTEE

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5 7
8
9
16 21 23
24
25
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CONSUMERS' UTILITY COUNSEL
Peachtree Street, Suite 933, Atlanta, GA 30303-3187 16
December, 1981

(404) 656-3982
Victor Baird, Counsel

This is the fourth annual report on the activities of the Office of Consumers' Utility Counsel. This year was the busiest ever. Every major utility in the state sought and obtained rate increases.
Millions of dollars in savings to consumers resulted from the Office's efforts in those cases.
This report details the work of the Office not only in these cases but in other areas, such as consumer education.

Victor M. Baird, Counsel

An Equal Opportunity Employer

cREATION AND PURPOSE OF THE OFFICE
I.

The Office of Consumers' Utility Counsel (CUC) was initially

create d

nits
~

present

form by the .

Consumers'

Utility Counsel

Act

o f

l977 '

which

establ~shed

the

Counsel

on

a

full-time

basis

for

two

Years

and

upgraded

the

Office

to .

agency

status.

In

the Georgia General Assembly cont~nued the 1977 Act for

1979

one year and amended it to provide that the Governor appoint

the Counsel and that the Office be attached to the Office of

Planning and Budget for administrative purposes only.

During the 1980 legislative session of the General Assembly

the consumers' Utility Counsel Act expired. There was a bill

to renew the Office , but this was part of a controversial

utility regulation reform bill of broad scope, House Bill

1252, which the General Assembly did not pass. As an interim

measure Governor Busbee appointed the Counsel to his staff,

and conferred on him substantially the same responsibilities

as he had hel d by statute.

The 1981 Session of the Georgia General Assembly recreated

the Office of Consumers' Utility Counsel essentially with the

same rights and responsibilities as had been provided in the

amended 1977 legislation ; however , a sunset provision was again

added to repeal the Act effective July 1, 1983 .

II. BUDGET
The Office of Consumers' Utility Counsel has received its funding from two sources since it was established as a fulltime agency in FY 1977.
During the Office's first three years (FY 1978, 1979, and 1980) state funds paid the salaries of a core staff and basic office expenses only . A federal grant enabled the Counsel to

7

hire staff necessary to conduct case-related research and to present expert testimony in electric cases. It also funded a utilities library for use by the public as well as the staff , and paid expenses of the Consumers' Advisory Committee which assists the Counsel in policy making. However, in FY 1981 no federal funds were anticipated and increased state funding was authorized.
Fortunately, the federal authorities unexpectedly responded to Counsel's request to fund a one year consumer education project, and to hire consultants to conduct studies and present expert testimony in rate hearings. Without this additional fe money Counsel could not have responded to the heavy caseload during the FY 1981 period.
The budget for FY 1981 was:

Personal Services Regular Operating Expenses
Travel
Publications & Printing
Real Estate Rentals Telecommunications Per Diem, Fees, Contracts

$ 258,029
10,413
7,000 630
13,000
5,000 20,000

TOTAL BUDGET

$ 314,072

State Funds Allocated Federal Funds Anticipated
Federal Funds Received
(FY-81/82) TOTAL FUNDS

$ 314,072
0
$ 151,899
$ 465,971

Of the $151,899 federal funds received, the following amounts

were expended in FY 1981:

Personal Services Regular Operating Expenses Travel
Printing & Publications
Real Estate Rentals Telecommunications Per Diem, Fees, Contracts
TOTAL EXPENDITURES

$ 17,8661

j 5 ,600 lcconsumer Education

12,'028358

Project)

0

1,437

49,490-(expert witnesses for

rate cases)

$ 77,716

8

FY 1982 federal grants were available although Counsel

No

carry over FY 1981 federal funds through

.,as allowed to

pecember 1981. Federal and

State

funds

available

for

FY

1982

are:

State

Federal

(7-1-81/6-30-82)

(7-1-81/12-31-81)

er sonal Servi~es Exp. $ :egular Operatlng
~~~~ing & Publications
TPReeelrae1cDoEimesmmta' uteFn. lecReaset!lnotnCaslosntracts

276,510 11,706 7,000 900 13,000 30,000 5,700

$ 50,533 2,400 2 , 762 915 6,000
10,510 1,063

TOTAL

$ 344,816

$ 74,183

All federal funds r emaining December 31, 1981 were lapsed , and as of January 1, 1982 the Office will be operated with state f unds only. The Consumer Education Project personnel were t erminated December 31, 1981.

III. CASE ACTIVITIES DURING 1981
Following is a review of the major case activities of the Office during 1981.
ELECTRIC CASES:
Savannah Electric and Power Company (SEPCO) GPSC 3220-U) - On September 7, 1980, SEPCO , a utility serving approximately 89 , 000 customers in and around Savannah, requested a rate increase of $12,945,678, amounting to 10.7% of total revenues. SEPCO pro~ posed to maintain existing relationships between customer classes and to continue residential rate designs which were promotional. Counsel petitioned the Commission to have SEPCO submit alternative rate designs which would eliminate the promotion discounts for total electric residential and for electric water heater customers, and would contain a seasonal differential. Counsel also parti~ cipated in revenue requirements issues and initiated two other matters, the consideration of management prudence in restoring its service area following hurricane David, and Counsel's proposal that resl. dentl. al conservatl.on pro gram energy aud.lt expenses be recovere d t hrough general rates and n ot through a direct charge
9

to the audited customer . On January 6 a Commission order incorporating Counsel's recommendations to exclude from the rate base Construction Work in Progress (CWIP), Property Held for Future Use, and Cash Working Capital associated with disallowed expenses was issued. The Commission found that there was no imprudence in restoring service.
The Commission did accept Counsel's proposal that residential energy audits be free of charge to the individual customer. Residential rate design hearings are still in progress .
SEPCO Fuel Cost Recovery Case (GPSC 3276-U) - In May, 1981 SEPCO requested an increase in its fuel recovery charge from the current 2.6512/kwh to 2 . 9913/kwh due to underrecovery of a total of $4.4 million during the previous months . Following the filing, new reports revealed an additional $1.5 million underrecovery during May . The total of $5.9 million in uncollected fuel costs resulted from unexpected increases in the costs of both oil and purchased power from the Georgia Power Company while SEPCO was retrofitting its largest plant for conversion to coal generation . In June the Commission awarded SEPCO a new fuel cost recovery rate of 3.0393/kwh.
Georgia Power Company (GPC) Retail Rate Case (GPSC 3270-U) On April 30, 1981 the Georgia Power Company filed a request for a $346.3 million increase in yearly retail revenues, the largest request ever filed by this utility. The Company sought to earn a return on equity of 18%, greater than any United States electr utility is now allowed. Several items disallowed by the Commission in its last Georgia Power rate case decision (GPSC 3129-U), in agreement with Counsel's position in that case, were omitted from the Company's filing.
10

concurrently with i ts application for a rate increase, asked t he Commis s i on to allow the rate increase to
e company i nt o effect under bond and subject to refund on June 1, Counsel v i gorous l y opposed this request and the Com-
':~ ~on denied the Company's motion and suspended the new
ate sche dules unt i l Nov embe r 1, 1981. In June, the Cons umers ' Ut i lity Counsel and another
intervenor filed separate motions asking the Commission to dismiss the Company 's r equest for rate relief on the grounds that the Company h a d failed to comply with the provisions of Ga. Code Ann. 893 -307 . 3(b ) ( Senate Bill 29) . The Commission
denied both mot i ons. Hearings on t he case began July 20. Counsel presented
experts who te sti fied on cost of equity; capital structure; cash working cap i tal allowance ; the accounting treatment of the Company's new headquarters at 333 Piedmont Avenue; vacation pay; taxes from pl ant s ale s ; and rate design .
After the c a se wa s h eard by the Commission, Counsel, the Commission s t af f , an d s evera l other intervenors in the case agreed that a $265.2 mil lion award would be fair to the Company and to the con sumers. The Georgia Power Company also agreed to this compromis e amount and agr e ed (absent unforseeable emergency) not to request an a ddi tional r ate increase until at least January 1983.
On Octob er 22 the Commission voted to award the Company a r ate increas e of $18 0 . 5 mi llion instead of the $265.2 million comp romise amount . The Comp any, threatening to appeal the decision to Ful t on County Superior Court and to apply for another rate i ncre as e in December 1981 asked the Commission t o reconsider it s de c ision . On November 24, the Commission voted to give the Company an additional $85 million, bringing t he total award to the re commended $265.2 million. As a condition for receivi ng t he additional money, the Company affirmed i ts earlier comm~ tment not to appeal the case and not to seek another rat e ~ nc re ase be f ore January , 1983. This agreement bshould s ave consumers a t lea st $40-50 million dollars in rates etween now and July 19 83 .
11

Testimony presented by Counsel supported adjustments which reduced the award in this case by $30 million.
Georgia Power Securities Case (GPSC 3221-U) - The Georgia Power Company had requested approval in 1980 to issue bonds for the purpose of financing its current construction progr~ Counsel subpoenaed the Company's officers and determined that the Company had conducted new energy and load forcasts s a decline in demand growth and an increased reserve margin. also questioned the officers as to the procedures they planned to carry out to evaluate the construction program in light of these forecasts. The Commission approved the bond issue but added a supplemental Order requiring the Company to complete the planned cost studies of its construction program and file a report, which the Company submitted in April, 1981. A ruling from Fulton Superior Court placed this report under protective order. Counsel then petitioned the Commission to hire a consultant to study the Company's present construction program and advise whether it should be modified. The Commission granted Counsel's petition and issued a request for proposals to consulting firms. However, due to the heavy caseload and the need for expert testimony, funds to conduct the study were not available in the Commission's budget.
Subsequent reports (Sept. 1981) of sharp cost increases for plants Vogtle and Scherer prompted the Commission to again a generation expansion plan study by an independent consultant, this time to be jointly funded by the Company. This study snu~~ be complete before mid-1982.
Georgia Power Fuel Cost Recovery Case (GPSC 3281-U) On June 12, 1981 Georgia Power Company applied to the Commission for permission to increase its fuel cost recovery rate from 1.6022 per kwh to 1.8528 per kwh, effective for bills rendered on or after August 1, 1981
CUC and the Commission staff submitted data requests to the Company during the course of the proceedings. CUC also parti-
12

d

. ely
act~v

in

the hearing process,

submitting

exhibits

qAuefstte~r. onanin~ao

wit naly

nes sis

s

es of

.

the

data

cue

. JO~ned

.
Wlth

the

.
Commls-

on staff ~n recommending a rate of 1 . 7327 per kwh . After
most re cent data on actual fuel cost undercollection was

ailable, the Commission authorized a rate of 1.8528 per kwh.

rgia Power Company Unit Power Sale Contracts (FERC-ER81-678) (;unsel intervened in this proceeding before the Federal Energy
gulatory Commission (FERC) for the sale of power from Plant erer in Georgia and Plant Daniel in Alabama. The power sales, oj ected to begin in 1983 and end in 1992 , would make use of be capacity of Plant Scherer before it is needed by Georgia

consumers. counsel intervened on the basis that, as representative
of retail ratepayers , cue had a vital interest in the sale of
power from plants financed in part by those ratepayers. In the most recent Georgia Power bond case (Docket 3221-U),
the Commission had ordered that a consultant be selected to
evaluate Georgia Power's ongoing generation expansion plan.
This plan is contained in a confidential report submitted to
the Commission as part of Docket 3221-U. Ideally, the sale of
unit power from Plant Scherer should not be consummated until the consultant has had the opportunity to evaluate the genera-
tion expansion plan. Unit power sales are among the many options
available in optimizing the Company's construction program.
Among the others are cancellation of plants, deferral of plants, outright sale of portions of plants, and numer ous combinations
of the foregoing opt i ons . cue contends that no option should
be e 1lmlnated before the consultant's recommendations have been considered b y the Commission. Also at issue in the Unit
Power Sale is the dist r ibution of profits, if any, which accrue to Georgl a power from the sales. For retail ratepayers this Wi ll be an issue befor e the GPSC rather than FERC . Since the
construction of Plant Scherer is being financed in part by Georgia rat epay er s , any profits from the sale should be pro-
Por tionat e 1Y a 1located to the ratepayers.

13

Georgia Power Plant Sales Case (U . S. SEC 70-6573) -For time Georgia Power Company has planned to sell to out-of-s utilities large percentages of a four-unit coal-fired el generating plant called Plant Scherer, while continuing to construct a more expensive two-unit nuclear facility, Plant Vogtle. During 1979 the Company announced its intention to sell a large portion of the Vo g tle plant as well.
Counsel intervened in the Securities and Exchange Commission's consideration of Georgia Power's proposed sale of 25% of Plant Scherer to Gulf Power, a related company. Counsel petitioned SEC to distinguish plant already built from plant under construction , whic~ under Section 13B of the Public Utility Holding Company Act of 1935, must be sold at cost to an affiliated company. Section 10B2 of the Act
J
which applies to plant already built, does not impose such a price restraint, and would permit the Company to sell Scherer units at a profit so as to return part of the profit to Georgia ratepayers. The case is pending and no decisions have been announced at this time.
Investigation of Past Plant Sales (GPSC 3255-U) - The Cv~u~~v~ has opened a proceeding to have Georgia Power Company account for the proceeds from past sales of Plant Hatch and Plant This proceeding has not progressed, again due to the many r cases tried during the year.
Georgia Power Wholesale Rate Case (FERC-ER-378, 730, 731) Counsel's participation in these cases has been for information gathering purposes and will continue to be so, because the Company's wholesale customers, the EMC's and municipally-owned utilities are represented by their own attorneys. Considerable data, useful in other proceedings involving Georgia Power, has been received through Counsel's intervention in these hearings.
14

15

TELEPHONE CASES:
Federal Communications Commission License Contract (Docket No. 80-742) - On March 31, 1981 Counsel intervened in an investigation of the reasonableness and appropria of license contract expenses charged to the Bell operatin companies for services rendered by American Telephone andg Telegraph and Bell Labs. This proceeding has important implications. For example, Southern Bell claimed expenses for license contract services in the latest rate case to be $20 million.
State of California et. al. vs. Federal Communications Commission. Second Computer Inquiry. Appeal of the FCC Ruling Before U.S. Court of Appeal for the District of Columbia (Docket No. 81-1193) - Counsel intervened in this ongoing proceeding on March 21, 1981. At issue is the power of the FCC to order the deregulation of customer premises equipment provided by AT&T and its operating telephone companies, including Southern Bell Telephone and Telegraph. Counsel questions the right of the FCC to usurp the authority of the state commissions and is concerned about the impact of this FCC order on local exchange rates.
Southern Bell Rate Case (GPSC 3231-U) - On October 3, 1980 Southern Bell filed for a rate increase to yield $148.6 million a year in additional revenues, later updated to $159.4 million. Among the issues in the case addressed by Counsel were a proposal to implement local measured service (local long distance) in the metropolitan Atlanta area, a proposal to raise the charge for local pay telephone calls from 10 to 25, a request that the revenues and expenses from the yellow-page operations be excluded from the rate case, and a request for a 16% return on common equity. Counsel also questioned the method the Company used in separating interstate and intrastate plant and expenses.
16

counSe l successfully opposed the implementation of

10 cal

sured service, arguing that such an optional rate mea
antifies and charges for each outgoing call on the

(which qu

f distance, duration, time of day, and time of week)

basis o

would quickly force the flat rate for service to a level

unaff ordable to most consumers and would eventually result

the elimination of this flat rate altogether. This

rineques t for "local long distance" will surely be made again. Counsel disputed the Company's request for a 25 charge

for pay phone calls . The higher charge will decrease the

usefulness of this telephone service to the general public

and properly-done cost studies show it's paying its own

ay at 10 per call . Counsel also argued that revenues

and expenses for yellow-page operations not be removed

from the case, on the grounds that the yellow page is a

part of the basic exchange telephone service and cannot be

separated for ratemaking purposes.

A'telephone separations expert hired by Counsel presented

convincing evidence of errors in Southern Bell's method for

separating interstate and intrastate plant and expenses.

Based upon this expert testimony the Company's request was

reduced $8,091,888.

Testimony presented by Counsel supported adjustments

which reduced the award by a total of $40 million.

Southern Bell vs. GPSC, Fulton County Superior Court (Docket
No. C-75044) - Southern Bell filed an appeal of the Commis-
sion's decision in GPSC 3231-U on April 15, 1981 before the Fulton County Superior Court. Counsel participated in the oral argument of the case and filed a brief defending the Commission's April decision. On September 21, 1981 Judge Charles A. Wofford issued an interim Order upholding, reversing and remand1 ng var1ous 1 ssues. After t he Comrn 1ss1 on

17

reconsidered its decision and submitted further evidence, the Court upheld the issues previously remanded, one of which was the cost of equity capital. Unfortunately, the Court allowed Southern Bell to keep about $25 million in yellow-page profits despite the Commission's factual f
-~~'1.441~1
that this profit is inextricably related to providing basic telephone service .
Southern Bell Telephone and Telegraph Case (GPSG 3286-U) _ On July 1, 1981 Southern Bell filed for yet another rate increase that would yield $180 million in additional annual revenues. The Company requested a 17.5% return on equity and an overall rate of return of 13.26%. Once again Counsel opposed the Company's exclusion of the yellow-page revenues and expenses from the rate case, acceleration of depr--~Qiw4,~ rates prior to FCC approval, and the proposed 25 charge for pay telephone calls. The Company dropped its request for "local long distance." Couns e l also addressed new issues raised by a recent Order of the Federal Communications Commission (FCC) requi ring that inside station connections be treated as expense items instead of as capital investments
Under the FCC order a four year phase-in (25% per year) to the full expensing of station connections must be implemented by Southern Bell, unless the Public Service Commission approves a flash - cut (100%) to station connection expensing. The flash-cut method, as opposed to phase-in, increased the immediate burden on ratepayers by raising the revenue requirement in this case by $20.9 million.
The Commission was persuaded by Counsel on tne following major points and included them in its Order: yellow-page operations revenues and expenses are included when determining the Company's revenue deficiency; the Company's proposed change to equal life group depreciation was denied; and the increase in non-recurring service charges should be low as possible in order to encourage universal service.
18

However, the Commission voted for: the flash-cutting of . connection expenses, approval of remaining life de8tatl..Ontion rates, and a 25 charge for local coin telephone Pserervcll...ace. Further, the Commission did not adopt the recoma.endatl.on of Counsel's expert witness on separations, who testl'.fied that as a result of unrepresentative sampling methods employed by Southern Bell, the Company's revenue deficiency was overstated by $17.3 million. The Commission order in this case was a settlement with Bell of the serious appeal in Docket No. 3231-U and included
an agreement not to ask for higher rates until March 1983.
eounsel sought reconsideration of the settlement because it included about $50 million in discretionary funds, but reconsideration was denied.
Testimony presented by Counsel supported adjustments which reduced the award by $34 million.
General Telephone Company of the Southeast (GPSC 3268-U) On April 17 General Telephone asked the Public Service Commission for permission to collect an additional $9.9 million from its 155,000 Georgia customers.
The Company proposed an increase in coin telephone rates from 10 to 25, adoption of a flexible pricing tariff for single-line instruments and a substantial increase in nonrecurring charges. Though the Company proposed that the revised tariffs become effective on May 17, the Commission suspended the proposed rates until October 17.
After discovery and prior to hearings, the Company, the Commission staff, and the Consumers' Utility Counsel stipulated some adjustments to the Company's rate base and net operating income which reduced the Company's request for additional revenues to $5.4 million. Accounting issues adjusted in the Stipulation included cash working capital, treatment of customer depos~ts, toll separations, construction work in progress, char~ table contributions, and lobbying expenses.
19

Other issues were tried at the hearings. Though the

Company requested a 17% return on equity and a 13.18% over-

all rate of return,

the

Commission allowed a

14



5~
to

return

on equity and a 12% overall rate of return.

Counsel opposed an increase in the pay telephone charge

and the Commission's Final Order adopted that position.

Counsel's proposal for a residual pricing approach to

rate design that resulted in a lower service charge, monthly

charge, and telephone instrument charge for the residential

customer was accepted by the Commission.

Continental Telephone Company of South Georgia (GPSC 3307-U) _ Continental Telephone asked Septe~ber 1 for permission to increase service charges for connecting telephone service, an increase of $209,709 annually. The rate increase request was based on the simultaneous request for an immediate change in accounting methods, treating station connection (inside wiring) as current expense, rather than capital expenditure on which a profit is due and which is recovered (as depreciati expense) equally in each year of its useful life. The Federal Communications Commission had earlier ordered a four year phasein of this change unless the state commission specially approved an immediate change, which Counsel has consistently opposed. Counsel questioned at the November 25 hearing the justification of the two requests, and also noted the lack of showing what other expense, revenue, and investment charges would occur in a typical year (a test year), without which it cannot be determined if a rate could be increased and still be "just and reasonable" as required by law. On December 15, the Connnission granted Counsel's November 25 motion and dismissed the rate increase application based on the lack of such a showing.

20

~:

Atlanta Gas Light Rate Case (GPSC 3288 -U) - On July 2, 1981,

;n ~l
At an a.

Gas

Light

requested

$47.1

mi llion

in

additional

annua1 revenues, later update d to $45.3 million. The

CotnP any requested a 19 . 5% return on common equity.

counsel objected to various accounting procedures

utilized by the Company in p r eparing its case, and hired

an expert consultant who testified that the Company had

overstated its working capital requirements, had failed to

annualize its revenues, and had not eliminated all ratepayer

supplied funds from the rate base. Another expert, testifying

on behalf of Counsel, urged the elimination of the higher

residential rate charged to mobile horne park and space-heating-

only customers. These higher rates were opposed as being

discriminatory and contrary to public policy considerations.

The accounting adjustments proposed by Counsel that were

accepted by the Commission reduced Atlant a Gas Light's revenue

deficiency by over $6 million. Also, the Commission withdrew

the mobile horne rate and placed all existing mob i le horne cus-

tomers on the regular residential rate schedule.

Testimony presented by Counsel supported adjustments

which reduced the award by $6 million .

In addition, Counsel presented testimony on the impact

of a recent change in the accounting procedures associated

with the Company's purchased gas adjustment clause. The

purchased gas adjustment transition could have resulted in

an overrecovery from ratepayers of over $14.5 million. The

Commission directed its staff to review this matter and to

report its findings to the Commission. Further hearings

are expected on this issue.

21

Columbia Nitrogen Corporation (CNC) and Ni-pro , Inc . vs.
Atlanta Gas Light (GPSC 3195-U) - In 1980 two large 1.-n-dustrial firms, CNC and Nipro, Inc . filed a complaint agai nat Atlanta Gas Light requesting an increase in their firm gas
entitlement. Counsel suggested that this increase would not only reduce the availability of gas to existing residential customers of Atlanta Gas Light, but would also limit Atlanta Gas Light's ability to add new residential customers and require the Company to accelerate its construction schedule for expensive new storage facilities. Hearings took place in July, September, and October of 1980. The Commission denied the complaint of CNC and Nipro, Inc. on February 3, 1981.
Gas Light of Columbus (GPSC 3282-U) - In June, 1981, Gas Light of Columbus filed a request for $1.7 million in additional annual revenues . Later the Company amended its request to $2.3 million. The Company asked for an overall rate of return of 13.02% including a .75% attrition allowance to offset inflation and increased expenses that might be incurred after the end of the test year. Counsel objected to the attrition allowance as not being appropriate under recognized ratemaking principles. An attrition allowance is not ordinarily added to the Company's rate of return when a year-end test period has been adopted by the Company .
Counsel also objected to various items claimed as operating expenses by the Company on the grounds that these expenses were not directly related to the furnishing of utility service .
22

On october 19, 1981, all parties to the proceeding entered

to an agreement which set forth the expense and rate base

in items

to

be

use d

l n

determl nlng-

t h e

company ' s

revenue

de f"lclency.

part of the stipulation agreement, the Company dropped its

AreSquest for an attrition allowance and stated that it would make a best faith effort not to file for another rate increase before June 1983 . The annual revenue increase awarded the

company was $1 . 53 million.

-TRANSPORTATION CASES:
~plicatlon of Class "A" Carriers (Docket 10491-M) - In September Class "A" carriers (Greyhound Lines, Inc., Trailways, Trailway Taimiani) requested an 18% increase in passenger and express rates, a 26.34% increase in commuter fares, and a 9.6% increase in charter fares . Counsel cross-examined the Companies' witnesses on their methods of accounting for recently eliminated routes and allocating revenues to intrastate operations. The Commission awarded the requested increase in full.
Application of Bekins Van Lines, Inc. to Implement Binding Estimate Tariff (Docket No. 10408-M) - Bekins Van Lines, Inc. petitioned the Public Service Commission for authority to establish an optional system of binding estimates for household goods carriers. Under the pre-existing procedure such carriers gave their customers nonbinding estimates of the charges based on the distance and time required to complete the move; however, the price ultimately paid is based not on the original estimate but on the actual time and distance incurred. The frequent after-the-fact divergence between the original estimate and the actual price charged is a constant source of consumer dissatisfaction and skepticism.
Comments submitted to the Commission by Counsel indicated general agreement with the Bekins proposal provided that suff"~c~. ent safeguards were incorporated in the system to guarantee

23

that abuse does not take place through the use of inflated estimates. Counsel suggested that (1) the binding estimate system should be established on an experimental basis pending a year-end review of all contracts entered into under the guarantee price option, and (2) carriers be required to offer each customer the option of initially selecting either the binding or nonbinding procedure.
On November 3, 1981, the Commission, after conducting a full hearing on the matter, granted Bekins authority to offer binding and nonbinding estimate tariffs provided that the charges ultimately assessed in the case of the binding estimate option is limited to the price that would have been charged if the hourly rates were applied to the actual time incurred in performing the move. Bekins subsequently filed a Petition for Rehearing, Reconsideration, and Oral Argument seeking a reversal of that part of the Commission's Order limiting the charge to the hourly rate applied to the actual time incurred in completing the move. The Commission, upon reconsideration, modified its original Order by eliminating the limitation.
OTHER CASES:
Residential Conservation Service Program (GPSC 3256-U, 3264-U, and 3272-U) - The National Energy Conservation Policy Act of 1978 required that natural gas and electric utilities offer energy audits to their customers. The financing of these energy audits was the main issue in these three cases.
Parties at the hearings discussed what portion of the total cost of the energy audit should be charged to the customer receiving the audit and how the remaining expenses of the audit should be recovered. After numerous hearings, the Commission ordered Atlanta Gas Light and Gas Light of Columbus to charge the customer receiving the audit a $15 fee. It was
24

determined that the remaining costs to the Company would be recovered from amounts returned to the Company from their natural. gas pipeline suppliers.
The cost of the energy audits have already been included in the base rates of Georgia Power Company and Savannah Electric and Power Company. Customers receiving the energy audit from those electric companies pay no fee.
Generic Hearings on Cogeneration and Small Power Production (GPSC 3252-U) - Hearings were held February 25, 1981 to determine proper procedure for state implementation of the Public Utility Regulatory Policies Act of 1978 (PURPA) , Sections 201 and 210.
The Public Service Commission voted to suspend all activity under PURPA pending final adjudication of the Mississippi suit challenging the constitutionality of the Act.
IV. CONSUMER EDUCATION:
Consumer Education Project - In the FY 1981 application to The United States Department of Energy, Counsel submitted a proposal to hire two additional personnel to develop and conduct workshops around the state, to prepare a consumers' handbook to the regulatory process in Georgia, and to produce a slide show to be used both in the workshops during the grant period and afterwards by civic and consumer groups. This special one-year project was funded by the federal grant.
A director and a consumer education specialist were hired and, after becoming familiar with the Consumers' Utility Counsel operations, electric regulation procedures in Georgia, and the objectives of the education project, designed a workshop that could be adapted to groups with both high and low educational levels. The project staff travelled throughout
25

the state educating groups about electric rate regulation in Georgia , including information about service termination regulations, reading an electric bill and meter, and solving problems with the utility companies.
The consumer education staff wrote a handbook, "A Look at Electric Rate Regulation in Georgia" and distributed it to individuals at the workshops . This twenty-seven page pamphlet, still available from this office, describes the regulatory process in Georgia, lists procedures for obtaining help with individual utility problems, describes the Public Service Commission's termination regulations, provides an interpretation of a typical bill, .and offers other information useful to residential consumers.
A slide show was also produced to simplify some of the information about the ratemaking process, with the consumer education staff writing the script, compiling the slides, and supervising the taping. Copies are now available for loan to interested groups upon request.
All of the workshops received publicity through office mailings, local sponsorship, radio and television appearances, and newspaper articles.
A total number of 61 workshops were presented in 23 cities throughout Georgia in 1981, reaching a total audience of approximately 1,721.
V. ADVISORY COMMITTEE The Advisory Committee of the Consumers' Utility Counsel
was established to provide Counsel with information on the views and concerns of residential and small business consumers of Georgia.
The Committee is composed of persons from a variety of areas and interests, including representatives of consumer groups, the academic community, and public agencies (other than regulatory agencies). Additionally, the membership includes consumers from every region of the State to ensure presentation of the widest possible spectrum of viewpoints.
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The members of the Committee are selected by Counsel and serve at his pleasure . Nominees are required to submit a brief resume showing their interest and qualifications to serve, after which Counsel makes selections with the advice of Committee members and CUC staff .
Meetings are held as the need arises to discuss issues relating to the regulated utilities in the State. The Committee makes recommendations to Counsel on the formation of appropriate policies and activities. While final decisionmaking authority is vested in Counsel, considerable weight is given to the policy recommendations of the Committee
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University of Georgia Athens, Ga. 30602 Attn: Library

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