[BETA] Fortnightly

The North Dakota Public Service Commission (PSC) has approved a request by Northern States Power Co., an electric utility, to treat all of its demand-side management (DSM) expenditures as expenses rather than capitalizing them. The PSC found that the change would strengthen the company's financial and competitive positions as it initiates its transition to a restructured electric industry.

In a 1992 rate order the PSC directed the utility to capitalize a substantial portion of the DSM costs over a five-year period. The PSC contended that allowing the utility to expense the costs would reduce the rate base and annual revenue requirement, yielding significant savings to ratepayers: Without the change, the utility's DSM rate base would grow to approximately $2 million; with the change, DSM rate base would shrink to zero by 2000. Re Northern States Power Co., Case Nos. PU-400-92-399; PU-400-95-401, Dec. 27, 1995 (N.D.P.S.C.).

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