The Federal Energy Regulatory Commission (FERC) has set for hearing issues related to a proposed, open-access transmission tariff for point-to-point service in Citizens Utilities Co.'s (CU) Arizona service territory. It also approved CU's agreement requiring a transmission customer, Aha Macav Power Systems, Inc., to pay a $190,000 contribution in aid of construction (CIAC) to interconnect to CU's grid (Docket No. ER94-1561-000).

CU claimed that its point-to-point transmission tariff is consistent with the comparability requirements set forth in American Electric Power Service Corp., 67 FERC  61,168, clarified, 67 FERC  61,317 (1994). CU said it uses its own system on a point-to-point basis, using the grid primarily to pick up purchased power where it interconnects with the Western Area Power Administration and to deliver the power to its distribution point.

The FERC's preliminary analysis, however, found indications that the tariff may be not be just and reasonable. To meet the comparability principle of American Electric Power, a tariff must offer service that gives the customer with the same degree of flexibility enjoyed by the transmission owner. CU has multiple resources and load centers, and the FERC suspects it may use its transmission network to integrate them. If CU so, the utility's proposed tariff will not satisfy the comparability standard.

The FERC accepted the CIAC agreement, but noted that CU had billed Aha Macav for all the charges about two weeks before the initial filing. Waiver of notice for new services undertaken prior to the date of filing is granted only in extraordinary circumstances, and the FERC found none present. Therefore, the FERC granted waiver of notice on condition that CU refund the time value of the CIAC charges for the entire period the rate was collected without FERC authority.

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