NAC704.876. Operating expenses of utility; recovery of expenses.

     1. Except as otherwise provided by subsection 3, all amounts incurred in carrying out the provisions of NAC 704.800 to 704.876, inclusive, must be treated as current operating expenses of the utility and may be recovered as follows:

     (a) Such expenses must be deferred by making appropriate credits to Accounts 908 and 909 and debiting FERC Account 186.

     (b) Appropriate deferred income tax amounts must be calculated and recorded by debiting FERC Account 410.1 and crediting FERC Account 283. Separate subaccounts for such amounts must be maintained.

     (c) The Commission will establish a monthly base cost at the time of each general rate case. The monthly base cost will be calculated by dividing such expenses by 12.

     (d) Each month the utility must compare the amount of the base cost with the actual amount of such expenses incurred in the month. If the actual charges are greater than the base cost, the difference must be credited in separate subaccounts in Accounts 908 and 909, and a debit in the same amount must be recorded in a separate subaccount in Account 186, Other Deferred Debits. If the actual charges are less than the base cost, the difference must be recorded as a debit in those subaccounts in Accounts 908 and 909, and a credit in the same amount must be recorded in the subaccount in Account 186.

     (e) Any accumulated debit or credit balance in the subaccount in Account 186 must be cleared once each year through an amortization charge or credit to be paid or received by each of the utility’s customers.

     (f) Prior approval of the amount to be amortized must be obtained from the Commission. A petition for such an approval may be filed concurrently with an application for a Deferred Energy Accounting Adjustment or a Purchased Gas Adjustment.

     (g) Each petition for such an approval must include the appropriate rate for amortization, based on cents per kilowatt-hour or cents per therm and based upon recorded sales in the test year. In addition, the petition must be accompanied by an exhibit showing the derivation of the rate and a summary of any entries made to Account 186 for such expenses.

     2. All revenues received through such an amortization must be credited to Account 186, less an allowance for mill assessments and uncollectible expenses in an amount equal to the rate derived from the utility’s last general rate case times gross revenues received from the amortization. A debit to the account must be made in an amount equal to the carrying charges on the balance at the end of the month of the entries made to the account pursuant to NAC 704.800 to 704.876, inclusive. The carrying charges must be calculated at a rate equal to one-twelfth of the overall rate of return last authorized for the utility by the Commission.

     3. Expenses incurred in supplying or installing material or equipment for conserving energy, except for measures required to be offered by subsection 1 of NAC 704.832, must be charged directly to the customer for whom those measures were provided.

     (Added to NAC by Pub. Service Comm’n, 1-19-84, eff. 5-17-84; A by Pub. Utilities Comm’n by R058-06, 6-28-2006)