[{"_1":2,"_87":-5,"_88":-5},"loaderData",{"_3":4,"_26":27},"root",{"_5":6,"_17":10,"_18":19,"_20":21,"_22":10,"_23":-5,"_24":-5,"_25":10},"user",{"_7":8,"_9":10,"_11":10,"_12":-5,"_13":-5,"_14":15,"_16":-5},"roles",[],"isAuthenticated",false,"isPremium","planName","subscriptionStatus","featureFlags",{},"insightsBudget","isDevelopmentHost","userPreferences",{},"recaptchaSiteKey","6LcvOJcUAAAAAHsB-gPGfGktcRlKpH7OTIU_dMTD","isImpersonating","impersonation","affiliateStatus","isFreedomPortal","routes/v2/article/layout",{"_28":29,"_30":31},"notFound",true,"relatedArticles",[32,75],{"_33":34,"_35":36,"_37":38,"_39":40,"_41":42,"_43":44,"_45":46,"_47":48,"_49":50,"_51":52,"_53":54,"_55":56,"_57":58,"_59":60,"_61":62,"_63":64,"_65":66,"_67":68,"_69":70,"_71":72,"_73":56,"_74":56},"mediaId",6363386,"mediaKeyId","2166300-423baea7f8a759875ecff673856f2e79","parentId",2166300,"title","Former utility analyst tells Utah PSC a 47.5% common equity ratio and ROE near 9.3–9.4% would be reasonable for Rocky Mountain Power","audioSeconds",518,"startMs",1554000,"endMs",2072000,"viewUrl","/Search/View?dp=1&key=2166300-423baea7f8a759875ecff673856f2e79&start=1554&end=2072","thumbnailUrl","https://assets.pipeline.soar.com/2166300-423baea7f8a759875ecff673856f2e79/thumbnail_1554000.jpg","articleUrl","/articles/6363386/Utah/Former-utility-analyst-tells-Utah-PSC-a-475-common-equity-ratio-and-ROE-near-9394-would-be-reasonable-for-Rocky-Mountain-Power","mediaUrl","https://secure.pipeline.soar.com/6363386-b32a33796343143047395de25aa78509/orig.mp4?Expires=1771151577&Signature=Kk1olL8lYpW0pwBGQjsWIEy9Jcz~rCITgt~VWoAzgYvTnN36hRayEOLQfVE50VBiHkc4Okpdp7SIQGuV1V5VB3OkuCcUZqERRr5B6p-5QS1jmtKyrSU~Je9wRoF3l-vTZjKG9Pk02D4FrBl7tNK1iMD~P9Qarw7ROZ6A1OJygv4HL7IvSKuKFETY5LqcKP-Qlo1yCfoYxXDyjNj~68KBLzFxmcfEnHbxrNcFWodLQOcudGroTcc46f1ZSW9m5Ts3Q8~zQjk3LfhrOFWAAaEBVmNME1f97tI7g5vpUl8LaAkmj50Ot5J~dtWeNKPnzySCCdoJXyWjn~rAWlgrr0k37g__&Key-Pair-Id=KUT5TJCACFTXG","author","","date","2025-01-28T18:49:50Z","article","Charles Peterson, who said he worked for 15 years on rate cases for the state division that reviews utility filings, told the Utah Public Service Commission in Cedar City that a hypothetical capital structure with a 45–50% common equity component is appropriate for Rocky Mountain Power and that a 47.5% common‑equity ratio is a reasonable compromise.

Peterson recommended an ROE decision range near 9.3–9.4% and said the commission could support the company's requested 9.65% only if it placed greater weight on expert testimony arguing for higher returns. \"A range of 45 to 50% for common equity appears to be…appropriate,\" Peterson said. He summarized competing expert positions in the case and said consultant estimates above 10% were driven by aggressive growth-rate and market‑risk assumptions.

Peterson referenced classic regulatory literature — correcting a transcription error he noted in his remarks, he cited the work of James Bonbright on utility regulation — and argued that regulators historically have allowed utilities some latitude to earn premiums above book returns when market evidence supports those outcomes. He said that, as a rough rule of thumb, adding approximately 3 percentage points to the current market yield on utility long‑term debt produces a reasonable ballpark ROE under normal conditions; using recent yields he estimated an ROE consistent with the low‑to‑mid 9% range.

Why it matters: The commission's decision on capital structure and ROE affects the utility's cost of capital, which in turn influences the rates paid by all customers. Peterson's testimony gives the commission an independent, technical assessment designed to inform where within the contested expert ranges the commission might set ROE and equity ratio.

Peterson concluded by offering to answer questions; commissioners thanked him for the prepared analysis. The hearing included public comment from rural customers after Peterson's testimony and continues as part of the broader docket (24-035-04).","mediaType","Video","parentTitle","Second Public Witness Hearing (24-035-04, RMP's Rate Case)","oneSentenceSummary","Charles Peterson, a former Division of Public Utilities staffer, told the Utah Public Service Commission that a hypothetical capital structure with roughly 47.5% common equity and a return on equity (ROE) in the low‑to‑mid 9 percent range is defensible in Rocky Mountain Power's general rate case.","taxTitle","Utah Public Service Commission, Utah Subcommittees, Commissions and Task Forces, Utah Legislative Branch, Utah","taxId",72399,"location","Utah","headline","shortSummary",{"_33":76,"_35":36,"_37":38,"_39":77,"_41":78,"_43":79,"_45":80,"_47":81,"_49":82,"_51":83,"_53":84,"_55":56,"_57":58,"_59":85,"_61":62,"_63":64,"_65":86,"_67":68,"_69":70,"_71":72,"_73":56,"_74":56},6363390,"Rural customers tell Utah Public Service Commission Rocky Mountain Power rate increase would strain farms; cite outages and damaged equipment",2011,617000,2628000,"/Search/View?dp=1&key=2166300-423baea7f8a759875ecff673856f2e79&start=617&end=2628","https://assets.pipeline.soar.com/2166300-423baea7f8a759875ecff673856f2e79/thumbnail_617000.jpg","/articles/6363390/Utah/Rural-customers-tell-Utah-Public-Service-Commission-Rocky-Mountain-Power-rate-increase-would-strain-farms-cite-outages-and-damaged-equipment","https://secure.pipeline.soar.com/6363390-cbfab8f656579c770ba7fa919c61c319/orig.mp4?Expires=1771151577&Signature=IvO8YBqxqX-gjKuRygBX7jgUAh4DoYTckJQXpXuLc4hkCMU0Kc3OaDD8BhRg7ZouwpxiEnknWXn0GCN7~nI1yEvJnqHBnWsGZA-Q0VT966KXZ6xKrT9suLhO0j9kd00-oqnV381ogf3o4rROks8XgcRvD6vw9b8uzS1w4cNGLGtUv2QaRYp9iDlbv3Drs8YCBcQXYhyVUcEt4HJowI92B7qM40-urlC1zfz3KgBRqY1F1xu6lzFPSlRf65sOaX6iwSztYedK88tEwAlKjlkOHQu-qbsRhl3~DovzCMK4EkLvioTV2hNhZUnyyJO1kWqj~sUM38R-8VbrQHLWh01-Jg__&Key-Pair-Id=KUT5TJCACFTXG","Chairman Jerry Phan of the Utah Public Service Commission heard public comment in Cedar City on the general rate case for Rocky Mountain Power (Docket No. 24-035-04), where several rural customers said a proposed rate increase would worsen financial pressure on farms and ranches and that repeated outages have damaged costly irrigation and processing equipment.

Speakers from Iron County and surrounding areas emphasized the stakes for producers who depend on reliable, high-quality power for irrigation and processing. \"This rate increase is significant and it's going to make an impact on what can be done and how it's gonna be done,\" said Stuart Bowler, vice president of the Utah Association of Conservation Districts and a Rocky Mountain Power customer. He told commissioners that producers already operate on narrow margins and face hard choices if rates rise.

The concerns combined two related complaints: the direct cost of higher rates and what speakers described as declining power quality. \"We keep being asked to tighten our belts and I think we've run out of holes,\" said Scott Stubbs, a rancher representing the Iron County Farm Bureau, which he said has about 600 members. Several speakers said outages and power \"bumps\" have increased repair costs and downtime.

David Burton, a producer from the Permamon Valley, described equipment failures and higher replacement costs when pumps or motors are harmed by repeated outages and surges. He said many producers have invested in variable frequency drives (VFDs) and other mitigation equipment but that the upfront cost is prohibitive for some operations. \"They're worth their weight in gold,\" Burton said of VFDs, but he added not all producers can afford them.

Travis Law, who operates an alfalfa cubing operation in the area, described frequent, sometimes multi-hour outages that extended his harvest and processing time. \"My power rates went up, but my quality of power decreased,\" Law said, adding that unplanned outages can take two to three hours to recover from and sometimes extend to five or six hours of downtime because equipment must be cleaned and restarted slowly.

Commissioners and staff asked follow-up questions about whether outages were related to wildfire mitigation shutoffs or other distribution problems, and farmers described both types: planned public-safety or wildfire-related shutoffs and shorter unplanned interruptions that they said occur multiple times during harvest periods. Speakers also said some producers had worked directly with Rocky Mountain Power and the company offers incentive programs for equipment such as VFDs, but that incentives did not fully offset costs for many smaller operators.

Why it matters: Commissioners are considering changes to rates that will affect residential and commercial customers statewide. Rural producers told the commission the combined effect of higher per‑kilowatt-hour charges and ongoing power-quality problems would raise production costs, increase equipment failures and could force scaling back operations.

The hearing in Cedar City was one of several public sessions in the general rate case; commissioners said the docket has generated hundreds of written comments and the commission will issue a final order within the statutory 240‑day period.

Speakers in this hearing asked Rocky Mountain Power and staff from the Division of Public Utilities and Office of Consumer Services to consider the rural impacts and possible additional incentives or mitigations for producers who face both high fixed costs and frequent outages. Commissioners encouraged continued dialogue between producers and the utility about incentive qualification and monitoring of power quality.

The public hearing in Cedar City concluded after no additional members of the public appeared to speak.","Farmers, ranchers and conservation officials told the Utah Public Service Commission in Cedar City that a proposed Rocky Mountain Power rate increase would hit agricultural operations hard and that frequent outages and surges are already damaging irrigation pumps and processing equipment.","actionData","errors"]

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Former utility analyst tells Utah PSC a 47.5% common equity ratio and ROE near 9.3–9.4% would be reasonable for Rocky Mountain Power

Rural customers tell Utah Public Service Commission Rocky Mountain Power rate increase would strain farms; cite outages and damaged equipment