SD utility companies told to inform regulators about tax savings
PIERRE — Investor-owned companies selling electricity or natural gas to customers in South Dakota should share the savings from federal tax reductions coming in 2018 so that consumers benefit, state Public Utilities Commission members decided Friday.
The three commissioners voted unanimously for a Feb. 1 deadline when companies must provide general information about estimated effects of Congress cutting the federal corporate-income tax rate from 35 percent to 21 percent.
The commission's staff in turn would work with each company on applying reductions to rates, riders and federal transmission tariffs that South Dakota customers pay.
Chairwoman Kristie Fiegen said the tax changes overall were the largest in 31 years.
"We don't do this every day," she said.
The proceeding covers MidAmerican Energy, Black Hills Energy, Montana-Dakota Utilities, Otter Tail Power, NorthWestern Energy, Xcel Energy and South Dakota Intrastate Pipeline.
Their representatives agreed Friday the companies would be parties in the docket.
The commission held the special meeting specifically ahead of the Jan. 1, 2018, start of the new tax year. The meeting lasted about 45 minutes.
"I think it's really important we expedite this process," Fiegen said.
Commissioner Chris Nelson asked for a firm deadline. Commissioner Gary Hanson said that made sense but suggested flexibility for each company to develop its plan.
"I want to be certain they have enough time," Hanson said.
Commission analyst Brittany Mehlhaff suggested the scope cover more than basic rates charged by each company.
"I understand it may take a while to get all the numbers together," Mehlhaff said.
The commissioners emphasized they want customers to see savings.
"It would appear this is going to be a significant amount of money that is going to be returned to customers," Hanson said. "I want the public to know the commission is not twisting arms here."
Fiegen said each company is in a separate financial and regulatory situation. In some instances, the tax savings might be applied to hold down future rate increases, she said.
"It will look differently with every company," Fiegen said.