20240515Final_Order_No_36182.pdf

Office of the Secretary
Service Date
May 15,2024
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF AVISTA'S ) CASE NO. AVU-E-24-05
ANNUAL RATE ADJUSTMENT FILING )
FOR ELECTRIC LINE EXTENSION )
SCHEDULE 51 ) ORDER NO. 36182
On March 29, 2024, Avista Corporation dba Avista Utilities ("Company") applied for
Commission approval of an update in costs and administrative changes to the Company's Electric
Line Extension Schedule 51 ("Application"). The Company requested a May 15, 2024, effective
date and that its Application be processed by Modified Procedure.
On April 18, 2024,the Commission issued a Notice of Application,Notice of Intervention
Deadline, and set dates for public comments and the Company's reply. Order No. 36154. No one
intervened.
On April 24, 2024, the Company filed a revision to update the workpaper and tariff sheet
for the Underground and Overhead Transformers.
The Commission Staff("Staff') filed the only comments to which the Company did not
reply.
Having reviewed the record, we issue this Order approving the Company's Application.
THE APPLICATION
Schedule 51 incorporates average costing for electrical facilities commonly used to extend
service. Schedule 51 sets forth "Basic and Exceptional Costs" that have a fixed and variable
component, with the variable component stated on a cost-per-foot basis. These Basic and
Exceptional Costs apply to facilities like transformers and conduit and are based on recent average
costs. The Company represents average costing works well and does not propose to change the
conceptual structure of the tariff in the Application.
In compliance with Order No. 35757 the Company included workpapers detailing the
"hours,materials, and vehicle support for each job."Application at 3.Actual work order estimates
were also included for each job type.
The Company updated the allowances for new residential, industrial, and commercial
customers' services. The updated allowances are based on an embedded cost method which seeks
to ensure investments in facilities for new customers track embedded costs included in base rates.
ORDER NO. 36182 1

Costs that exceed the allowance must be paid by the customer and will be booked as a contribution
in aid of construction. The embedded costs are based on a cost-of-service study used for the
Stipulation and Settlement approved in the Company's recent general rate case. See Case No.
AUV-E-23-01. The proposed changes are as follows:
Service Schedule Existin Proposed
Schedule 1 Individual Customer per $ 2,095 $ 2,475
unit
Schedule 1 Duplex per unit $ 1,675 $ 1,980
Schedule 1 Multiplex per unit $ 1,260 $ 1,490
Schedule 11/12 per kWh $ 0.16986 $ 0.19321
Schedule 21/21 per kWh $ 0.15731 1 $ 0.17749
Schedule 31/32 per kWh $ 0.27217 1 $ 0.31838
The Company is not proposing to update the Construction and Material Standards because
the current standards comply with and reflect the most recent National Electric Safety Code. The
Company does propose to update the primary, secondary, service, and transformer average cost as
follows:
Present' Proposed
Overhead Primary Circuit
Fixed Cost $ 4,875 $ 5,379
Variable Cost $ 9.63 $ 10.69
Underground Primary Circuit
Fixed Costs $ 2,232 $ 2,516
Variable Costs $ 13.07 $ 13.48
Underground Secondary Circuit
Fixed Costs $ 600 $ 666
Variable Costs $ 14.38 $ 14.17
Overhead Secondary Circuit
Fixed Costs $ 1,976 $ 2,212
Overhead Service Circuit $ 4.04 $ 5.02
Underground Service Circuit $ 11.41 $ 10.46
Overhead Transformer $ 3,615 $ 4,436
Padmount Transformer $ 7,598 $ 7,470
1 The Company's Application mistakenly included the term"Proposed"in this column.
ORDER NO. 36182 2

The Company indicates the primary driver of higher costs are increased labor and
transformer cost. The driver of reduced costs for some underground work stems from a reduction
in conduit costs. Overall,the Company notes demand outpaces supply in the utility sector, driving
prices upward. To highlight this the Company provided the following illustration related to
transformer costs:
December 2021 December 2022 December 2023 22-23 change
Transformer— $1,700 $4,820 $7,095 47.2%
25KVA
Transformer— $2,255 $5,660 $8,021 41.7%
50KVA
The Company proposed to update its residential development costs to reflect the most
current Construction and Material Standards and average 2023 construction costs as follows:
Residential Developments Present Proposed
Total Cost per Lot $ 2,947 $ 3,358
Less: Service Cost $ 572 $ 525
Developer Responsibility $ 2 375 $ 2 833
Developer Refundable Payment $ 2095, $ 2,475
Builder Non-Refundable Payment $ 852 $ 883
Allowance $ 2,095 $ 2,475
STAFF'S COMMENTS
Staff reviewed the Company's Application and revision plus the workpapers and proposed
tariffs and recommends approval of the Company's update to average costs and construction
allowance for Schedule 51.
Staff s review led it to believe that the Company used the method to calculate average costs
consistent with past updates to Schedule 51. The Company's average cost updates for primary and
secondary service and transformer costs were calculated using the recent average actual costs most
commonly used for line extensions. Staff mentioned the Company's revision and the subsequent
updates that were applied to residential development costs. Staff acknowledged the Company's
workpapers were included to comply with Order No. 35757 in Case No. AUV-E-23-03, the
Company's most recent Schedule 51 update. Staff believed these workpapers satisfied the
requirements of that Order. Staff s discussion of average cost updates moved to the drivers of
increases and decreases, which Staff agreed justified the changes. Last, Staff determined the
ORDER NO. 36182 3

Company's method for calculating residential development costs followed the authorized method
from Order No. 28562.
Staff verified the proposed updated construction allowances for new residential,
commercial, and industrial customers are based on embedded line extension costs in the Cost-of-
Service study from the most recent general case and are therefore reasonable.
Staff reviewed the Company's notice that was sent to impacted customers and agreed it
both met the requirements of Rule 125 of the Commission's Rules of Procedure, IDAPA
31.01.01.125, and provided adequate time for customers to review and respond to the Company's
Application.
COMMISSION FINDINGS AND DISCUSSION
The Commission has jurisdiction over the Company's Application and the issues in this
case under Title 61 of the Idaho Code including, Idaho Code §§ 61-501, -502, and -503. The
Commission is empowered to investigate rates, charges,rules,regulations,practices, and contracts
of all public utilities and to determine whether they are just, reasonable, preferential,
discriminatory, or in violation of any provisions of law, and to fix the same by order. Idaho Code
§§ 61-501, -502, and-503.
The Commission has reviewed the Company's Application including all submitted
materials, Staff comments, and the Company's revision to Overhead and Underground
Transformers. Based on its review of the record,the Commission finds it fair,just, and reasonable
to approve the Company's Application as revised by the April 24, 2024, filing for Underground
and Overhead Transformers.
ORDER
IT IS HEREBY ORDERED that the Company's Application to update costs for Schedule
51 is approved.
IT IS FURTHER ORDERED that the Company's revised tariff sheets filed with its
Application as supplementally updated for Underground and Overhead Transformers, are
approved, effective May 15, 2024.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days of the service date upon this Order regarding any
matter decided in this Order. Within seven (7) days after any person has petitioned for
ORDER NO. 36182 4

reconsideration, any other person may cross-petition for reconsideration. See Idaho Code § 61-
626.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 151h day of
May 2024.
ERIC ANDERSON, PRESIDENT
?HiNR. HAMMOND JR., COMMISSIONER
�
DWARD LOD /E4, MgMISSIONER
ATTEST:
n arri c z
Commission Secretary
I:\Legal\ELECTRIC\AW-E-24-05_Sch51\orders\AW E2405_final_dh.docx
ORDER NO. 36182 5