20180622final_order_no_34095.pdf

Office of the Secretary
Service Date
June 22,2018
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )OF ONVOY,LLC AND FRONTIER )CASE NO.VZN-T-18-02
COMMUNICATIONS NORTHWEST INC.)FOR APPROVAL OF THE )INTERCONNECTION AGREEMENT )ORDER NO.34095
On May 22,2018,Onvoy,LLC (Onvoy)and Frontier Communications Northwest Inc.
(Frontier)applied to the Commission for an Order approving an Interconnection Agreement
(Agreement).With this Order,the Commission approves their Agreement.
BACKGROUND
Under the provisions of the Telecommunications Act of 1996,interconnection
agreements must be submitted to the Commission for approval.47 U.S.C.§252(e)(1).The
Commission may reject an agreement adopted by negotiations only if it finds that the agreement:
(1)discriminates against a telecommunications carrier not a party to the agreement;or (2)
implementation of the agreement is not consistent with the public interest,convenience and
necessity.47 U.S.C.§252(e)(2)(A).As the Commission noted in Order No.28427,companies
voluntarily entering into interconnection agreements "may negotiate terms,prices and conditions
that do not comply with either the FCC rules or with the provision of Section 251(b)or (c)."
Order No.28427 at 11 (emphasis in original).This comports with the FCC's regulation that "a
state commission shall have authority to approve an interconnection agreement adopted by
negotiation even if the terms of the agreement do not comply with the requirements of [Part 51]."
47 C.F.R.§51.3.
THE APPLICATION
The Application stated that the Agreement was reached through voluntary negotiation
without resort to mediation or arbitration and was submitted for approval pursuant to Section
252(e)of the Communications Act of 1934,as amended by the Telecommunications Act of
1996.The Agreement establishes terms and conditions for Interconnection,Unbundled Network
Elements (UNE),Ancillary Services,and Resale Telecommunications Services.
STAFF RECOMMENDATION
Staff reviewed the Application and Agreement and believes the terms and conditions are
not discriminatory or contrary to the public interest.Staff also believes the Agreement is
ORDER NO.34095 1
The variable energy component is composed of two parts,fuel costs for PacifiCorp
Utah thermal plants and variable O&M costs.Commission Order No.28708 clarified how each
of these two parts to the variable energy component is to be calculated:
For those PacifiCorp contracts with 1992 Addendum language,we note by
way of clarification,that the fuel component calculation is to remain
unchanged,i.e.,"average fuel costs as reported in FERC Form 1 forPacifiCorpCarbon,(Hale-presently out of service),Naughton,Huntington
and Hunter plants."The variable O&M under the PacifiCorp QF contractswhilepresentlyfixed,is to be tied to Colstrip beginning in 2003.The
Commission notes that pursuant to the '92 Addendum language in the
PacifiCorp QF contracts,generation taxes and a line loss adjustment arespecificallyexcludedfromthecalculationofanyvariableO&M.It is not ourintentiontochangethiscontractterm.The Commission notes,as calculated
by Staff,that the exclusion of line loss (5%)and generation tax (20¢/MWh)
from the variable Colstrip calculation for affected PacifiCorp contracts
(beginning in 2003)results in an adjusted O&M figure of $1.51/MWh.
In Commission Order No.29316 in Case No.PAC-E-03-10 the Commission
authorized and approved a new variable energy rate for PacifiCorp/QF contracts with approved
1992 amendment language and ordered the Company as follows:
Recognizing the variable rate change we approve today is the first of what
will be an annual change in the variable rate for PacifiCorp/QF contracts with
92 Amendment language,IT IS FURTHER ORDERED and the Commission
does hereby direct PacifiCorp to make an annual filing with the Commission
on or before June 1 of each year showing its computation of the revised
variable energy costs for these contracts.
Order No.29316.
In accordance with Order No.29316,the adjustable portion of the avoided-cost rate
for existing PacifiCorp contracts with year 1992 amendments has been recomputed.Beginning
on July 1,2003,the adjustable portion for these contracts was ordered to be equal to the average
cost of fuel for the Carbon,Hale,Naughton,Huntingtonand Hunter generatingplans,including a
variable O&M component of $1.51/MWh but exclusive of generation taxes and a line-loss
adjustment.The variable energy rate applicable to deliveries commencing July 1,2018,
extending through June 30,2019,has been computed to be $23.67/MWh,an increase from
$23.29 last year.
ORDER NO.34097 2
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this
day of June 2018.
PAUI KJFI l \NDI R.PRESIDENT
KRISÌlNE RAPER,C MISSIONER
ERIC ANDERSON,COMMISSIONER
ATTEST:
Diane M.Hanian
Commission Secretary
VZNTl802 intercon sci
ORDER NO.34095 3