20080415_2229.pdf

DECISION MEMORANDUM
TO:CO MMISSI 0 NER RED FORD
COMMISSIONER SMITH
COMMISSIONER KEMPTON
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM:WELDON STUTZMAN
DEPUTY ATTORNEY GENERAL
DATE:APRIL 22, 2008
SUBJECT:CASE NO. P AC-08-
P ACIFICORP'S REQUEST FOR AN ACCOUNTING ORDER
AUTHORIZING THE COMPANY TO ESTABLISH A
REGULATORY ASSET
On April 11 , 2008, Rocky Mountain Power a division of PacifiCorp filed an
Application for an accounting order authorizing the Company to establish a regulatory asset for
costs associated with a payment made to the owner of a generation facility. The payment gives
PacifiCorp an exclusive opportunity to negotiate for the purchase of all tangible and intangible
assets, contracts , permits and other rights associated with the generation facility. The details of
the payment and potential purchase were provided by the Company in confidential proprietary
documents filed with the Application. The Application states that PacifiCorp made a payment
the amount of $8.7 million for the exclusive right to negotiate with the seller during a specific
period regarding the proposed transaction. During the exclusivity period, the seller is prohibited
from negotiating with other potential buyers or lessors of the property. The $8.7 million
payment also is a deposit toward the total purchase price.
PacifiCorp requests by its Application an accounting order authorizing the Company
to establish a regulatory asset for the payment made by the Company. PacifiCorp acknowledges
that an accounting order would not determine the prudency or rate treatment of the payment.
That review would be made in a future rate proceeding.
PacifiCorp requested that its Application be processed by Modified Procedure.
Staff recommends that the Application of PacifiCorp for an accounting order be
processed by Modified Procedure with comments due June 5 , 2008.
DECISION MEMORANDUM
COMMISSION DECISION
Should the Application of PacifiCorp for an accounting order authorizing a regulatory
asset be processed by Modified Procedure with comments due June 5 , 20087
~--
Weldon B. Stutzman
Deputy Attorney General
bls/M:PAC-O8-02 ws
DECISION MEMORANDUM