Qualified Capital Project Adjustment Charge (QCPAC)

Pennichuck Water Works, Inc.’s (“Pennichuck”) primary goal is to provide exceptional service and delivery of quality water 24 hours a day, 365 days a year. We regularly evaluate the infrastructure of our systems to identify areas that require improvement. As part of PWW’s rate proceeding in 2016 and 2017 associated with public docket DW16-806, the New Hampshire Public Utilities Commission (PUC) granted approval for PWW to implement a Qualified Capital Project Adjustment Charge (QCPAC).  The QCPAC will allow PWW to bill a monthly surcharge based on a percentage of your monthly bill.  The surcharge will recover the costs of Pennichuck’s ongoing investment in capital projects necessary to provide service to its customers, in compliance with State and Federal regulations, and to maintain its overall water supply and treatment infrastructure in a proactive and responsive manner.

The PUC order can be viewed here

The QCPAC surcharge replaces the Water Infrastructure and Conservation Adjustment (WICA) surcharge that was in effect prior to the PUC’s approval of the QCPAC surcharge.  The WICA surcharge only existed for a portion of PWW’s customers, whereas the QCPAC applies to all PWW customers.  The WICA allowed the Company to recover the cost of debt and property taxes associated with the replacement of water mains, valves, and hydrants that had either reached the end of their useful life or were negatively impacting water quality or service reliability. The QCPAC expands the WICA surcharge by allowing Pennichuck to recover 1.10 times the annual principal and interest for the debt issued, plus the property taxes associated with capital expenditures that Pennichuck made on plant and equipment placed into service during the prior year.  As a part of this annual process, Pennichuck’s capital expenditures will be audited by the PUC for prudency and confirmation of actual expenditure levels.  The benefits of the QCPAC program to our customers is that it provides the funding necessary for Pennichuck to maintain a consistent plan for the replacement of aging infrastructure, which in turn increases reliability and quality of service. The QCPAC program will also result in smaller annual rate changes for customers by permitting Pennichuck to recover the expenses associated with the replacement of aging infrastructure between rate cases.

Pennichuck will be filing a proposed three-year capital expenditure plan for 2018-2020 QCPs (Qualified Capital Projects) with the PUC on or before February 16, 2018. The 2018-2020 proposed QCP’s submitted will update a submission of Pennichuck’s 2017 through 2019 proposed capital expenditures placed on file with the PUC in January of 2017 in conjunction with its DW 16-806 rate filing for QCP capital expenditures planned for 2017 to 2019. As part of the February 2018 QCPAC filing, Pennichuck is requesting the PUC to allow it to establish a QCPAC surcharge of 1.62%.  The QCPAC surcharge will apply to meter classes and charges for service rendered after March 1, 2018.

The requested QCPAC surcharge of 2017 QCPs, if approved, would result in the average single family residential bill increasing by approximately $0.81 per month, and resulting in the average single family residential bill increasing from about $54.00 per month to $54.87 per month.

If you have any questions or concerns related to Pennichuck’s February 2018 QCPAC filing, please contact Pennichuck Customer Service at 800-553-5191 or the New Hampshire Public Utilities Commission at 800-852-3793.