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Home My WebLink About20101122_3151.pdfKRISTINE A. SASSER DEPUTY ATTORNEY GENERAL IDAHO PUBLIC UTILITIES COMMISSION PO BOX 83720 BOISE, IDAHO 83720-0074 TELEPHONE: 208-334-0357 MAIL: kris.sasser~puc.idaho.gov IDAHO BAR NO. 6618 Street Mailing Address: 472 West Washington Street Boise, Idaho 83702-5918 Attorney for the Commission Staff BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF THE COMMISSION' INQUIRY INTO LOAD GROWTH ADJUSTMENTS THAT ARE PART OF POWER COST ADJUSTMENT MECHANISMS. COMMISSION STAFF MOTION TO CONSIDER PROPOSED METHODOLOGY CASE NO. GNR-IO- Power supply costs represent a significant portion of a utility s total revenue requirement and are subject to a high degree of volatility largely outside the utility s control. Power cost adjustment mechanisms allow a utility to collect from customers or credit to customers the majority of the difference between actual net power costs incurred by the utility to serve its customers and the normalized amount of power supply costs collected from customers through rates set in a general rate case. In a recent case (P AC- E-l 0-0 1), the Commission observed that in periods of declining load the mechanism "appears to operate much the same as a decoupling mechanism reimbursing the Company for lost revenue for reductions in customer usage (sales)." Order No. 31033. The Commission directed Staff to hold a workshop "to discuss this phenomenon and report continued justification for use of an LGAR (load growth adjustment rate) when loads decline.Id. COMMISSION STAFF MOTION TO CONSIDER PROPOSED METHODOLOGY On June 9, 2010, Commission Staff met with representatives from Avista, Idaho Power and Rocky Mountain Power to identify and discuss differences in the three load growth adjustment mechanisms. On September 10 2010, the Commission initiated this case and issued a Notice of Workshop to provide a forum for the exploration of issues related to load growth adjustments. The workshop was held September 28 , 2010. Representatives from Avista, Idaho Power, and Rocky Mountain Power were in attendance as well as Commission Staff and other interested parties. A vista and Idaho Power utilize a Power Cost Adjustment mechanism (PCA). Rocky Mountain Power s mechanism is characterized as an Energy Cost Adjustment Mechanism (ECAM). All three mechanisms are designed to recover/rebate abnormal power supply costs in similar ways. All three currently contain a load growth adjustment mechanism. The Commission and other parties have expressed concern over costs added to the adjustment mechanisms due to declining loads. Some parties support an asymmetrical approach that would remove dollar amounts from recovery by the utilities when load grows with no adjustment when load declines. Others believe that the adjustment can be made symmetrical and fair by eliminating the load growth adjustment mechanism entirely. At the September 28 workshop, A vista offered a compromise position that amounts to a revision of current methodology. The proposal maintains symmetry in growing and declining load scenarios and substantially reduces the load growth adjustment rate (LGAR) such that the impact of imputed costs to the various utilities in declining load scenarios is reduced but not eliminated. The proposal bases the rate on the energy classified portion of embedded production revenue requirement. Presently, the rate for Idaho Power and Rocky Mountain Power is based on all embedded production revenue requirement. Avista s current rate is based on all production and transmission revenue requirement. The proposed change reduces load decline imputed costs that accumulate in the three cost adjustment mechanisms. It also potentially eliminates the issue of decoupling from the cost adjustment mechanisms and avoids the possibility of double recovery of demand classified embedded production revenue requirement that Idaho Power recovers from residential and small commercial customers through a Fixed Cost Adjustment (FCA) mechanism. The following table shows the LGARs under present methodology and Avista s proposed methodology for all three utilities. COMMISSION STAFF MOTION TO CONSIDER PROPOSED METHODOLOGY CURRENT PROPOSED UTILITY UNITS METHODOLOGY METHODOLOGY A vista $/MWH 48.30. Idaho Power $/MWH 26.15.43 Rocky Mountain Power $/MWH 19. By this Motion, Staff requests that the Commission allow the interested parties to proceed on the consideration of this proposal through the use of Modified Procedure, set a comment deadline of January 14 2011 , and a response comment deadline of January 28, 2011. Respectfully submitted this ih day of November 2010. 4-j;~ 110 Kristine A. Sasser Deputy Attorney General N:GNR-IO-O3 ks LGAR Motion COMMISSION STAFF MOTION TO CONSIDER PROPOSED METHODOLOGY CERTIFICA TE OF SERVICE HEREBY CERTIFY THAT I HAVE THIS DAY OF NOVEMBER 2010 SERVED THE FOREGOING COMMISSION STAFF MOTION TO CONSIDER PROPOSED METHODOLOGY, IN CASE NO. GNR-I0-03, BY MAILING A COpy THEREOF, POSTAGE PREPAID, TO THE FOLLOWING: LISA NORDSTROM IDAHO POWER COMPANY PO BOX 70 BOISE ID 83707-0070 MIKE YOUNGBLOOD IDAHO POWER COMPANY PO BOX 70 BOISE ID 83707-0070 MARK C MOENCH DANIEL E SOLANDER ROCKY MOUNTAIN POWER 201 S MAIN STREET SUITE 2300 SALT LAKE CITY UT 84111 TED WESTON ROCKY MOUNTAIN POWER 201 S MAIN STREET SUITE 2300 SALT LAKE CITY UT 84111 DAVID J MEYER A VISTA UTILITIES PO BOX 3727 SPOKANE W A 99220 KELLY NORWOOD A VISTA UTILITIES PO BOX 3727 SPOKANE W A 99220 ATLANTA POWER COMPANY PO BOX 10 ATLANTA ID 83601-0010 SECRETARY CERTIFICA TE OF SERVICE