20080820ATL to Greene Tree 1-3.pdf

ATLANTA POWER COMPANY INC.
I I 140 CHICKEN DINER ROAD
CALDWELL, IDAHO 83406 I. . ....,.:t,~ :;:
August 20, 2008
Idaho Public Utilities Commission
P.O. Box 82720
Boise, Idaho 83720-0074
ATL-E-08-02
ATTENTION COMMISSION SECRETARY AND HEAD LEGAL SECRETARY
Enclosed is Atlanta Power Company's reply to Intervener Greene Tree Incorporated's
discovery request dated August 8, 2008. Also enclosed is a "Certficate of Service".
Sincerely,(~~Israel Ray
President
Israel Ray
Atlanta Power Company, Inc.
11140 Chicken Dinner Rd.
Caldwell, 1083406
TeL. [phone]
Fax [phone]
Representative for Atlanta Power Company, Inc.
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF )ATLANTA POWER COMPANY )
FOR AN ORDER AUTHORIZING INCREASES IN)
THE COMPANY'S RATES AND CHARGES FOR)
ELECTRIC SERVICE IN THE STATE OF IDAHO)
CASE NO. ATL-E-ÐS-2
REPLY TO
GREEN TREE INC.
DISCOVERY REQUEST
COMES NOW Atlanta Power Company Inc., ("Atlanta Powet', "Applicant"
or "Company") and hereby files the following reply to the discovery request of
intervener Greene Tree Inc. (Intervener or Greene).
Request NO.1. Please provide Any and all cost of service studies or
analysis used to develop the proposed 10 cents/ kwh charge for residential
customers and the proposed 20 cents/kwh charge for commercial customers.
Reply. First, Applicant draws interveners attention to the" Amendment to
Application" filed by Atlanta Power Company on August 8, 2008. That
amendment changed Applicants proposed rate design. In response to
Interveners question regarding "Any and all cost of service studies or
analysis", Applicant did not and has not penormed any cost of service studies
as typically penormed for much larger electric companies. Atlanta Power
Company is a very small electric system. It is not interconnected with any
other electrical system or grid, does not buy or sell excess wholesale power.
The Company relies primarily on a single hydro-electric generator with a
RESPONSE TO DISCOVERY REQUEST
OF GREENE TRE INC. 1 Augu 20, 2008
back-up diesel powred generator for use when the hydro generator is out of
service. The hydro and diesel generators are not synchronized and cannot
be used simultaneously to follow customer power demands on the system.
There are no demand meters installed for measurement of customers
electrical demands on the system. Atlanta Power Company's initial rate
proposal was intended to demonstrate that the Company's costs are primarily
fixed costs (do not vary with the amount of power produced and sold) except
when there is a problem with the Company's hydro-electric plant and the
back-up diesel generator must be operated. Please see the statement made
by Robert Smith at the "Public Hearing" in this case on June 12, 2008.
The amended rate proposal was developed in response to customets
comments regarding affordabilit and to try and maintain relative ratios
among the rate schedules. Enclosed is a compact disc containing an Excel
file titled "Rates" that may be useful in your review. Response prepared by
Robert Smith, Consultant. Witness, Robert Smith.
Request NO.2. With respect to Exhibit 2 accompanying your Application,
please identify the listed categories of expense you consider to reflect
variable costs, i.e. those costs which fluctuate depending on the amount of
electrical generation produced.
Reply. Fuel expenses vary depending upon the need to use the Company's
back-up diesel generator. The Company's commercial general liability
Insurance policy premium is base upon the amount of energy produce by
the Company. See also our reply to Request No. 1 above. Response
prepared by Robert Smith. Witness, Israel Ray, President.
Request No.3. Please provide in narrative form your rationale, whether
based on cost of service or otherwise, for the proposed 10 cents/kwh charge
for residential customers and the proposed 20 cents/kwh charge for
commercial customers and the disparity between the two charges.
RESPONSE TO DISCOVERY REQUEST
OF GREENE TRE INC. 2 August 20, 2008
Reply. See Reply to Request No. 1 above. Following is a chronological
history of Atlanta Power Company's basic rate schedules. In 1988, (Case No.
U-1147-6l Atlanta Power Company proposed just two rate schedules, a
residential rate and a commercial rate. Atlanta proposed uniform energy
rates for both classes of customers. The Company proposed a customer
charge for residential customers of $30 per month and a customer charge
333% greater or $100 for commercial customers. The Idaho Public Utilties
Commission in its Order No. 21928 expressed concern over the elasticity of
demand for service from the Company's customers and initiated separate
rates for part-time or seasonal customers of Atlanta. The Commission
approved uniform energy rates for permanent residential and commercial
customers. Residential minimum charges were set at $50 per month and
commercial minimum rates were set 100% greater at $100 per month. Both
permanent classes were allowed a basic block of energy of 500 KWh/ month
before the energy charge would be applied to the excess over the 500 KWh
monthly allowance. The Commission established a single seasonal rate
applicable to both residential and commercial customers of $25 per month
plus an energy charge of $0. 12/KWh. In recognition of the extra costs the
Company was subject to in winter months when hydro generation was limited
and the Company had to rely upon diesel generation, the Commission
established a winter charge of $0. 12/KWH for all energy used in excess of
1,000 KWh/month to encourage conservation.
Reconsideration Order No. 22167 reduced the residential energy rate from
$.068/KWh to $0.05/KWh and increased the seasonal commercial minimum
charge from $25 to $50 per month. All other rates remained the same.
Case No ATL-E-91-1 dealt solely with an emergency surcharge that treated
all customer classes alike. A $0.1023 surcharge was authorized for all KWh's
sold regardless of customer class.
RESPONSE TO DISCOVERY REQUEST
OF GREEN TRE INC. 3 August 20, 2008
Case ATL-E-93-1 was Atlanta Power Company's last general rate case. The
Commission by its Order No. 24925 effective June 15, 1993 increased the
permanent residential minimum bil from $50 per month to $81 per month
(62%) and the permanent commercial minimum charge from $100 per month
to $144 per month (44%). The commercial minimum charge was now 77.8%
larger than the permanent residential minimum charge. Permanent
residential KWh charges over the 500 KWh allowance were left unchanged at
$0.05/KWh. Permanent comercial KWh charges over the 500 KW
allowance were increased from $0.068/ KWh to $0. 18/KWh (164.7%). The
Commission eliminated the $0. 12/Kh winter charge for use over 1,000
KWh's. Seasonal residential customer charges were increased by 40% from
$25/month to $35/month. Seasonal commercial customer charges were
increased by 30% from $50/month to $65/month. Seasonal residential
energy charges were left unchanged at $0. 12/KWh for all consumption.
Seasonal commercial energy charges wefe increased by 75% from
$0. 12/KWh to $0.21/KWh. The Commission in its order indicated that the
rates were intended to increase revenues across the board by 36% in each
class. A three page attachment to the Commission's Order No. 24925
demonstrates the new rate design though not uniform to all rate schedules
would indeed be uniform to the revenue generated by all classes of
customers.
Atlanta Power Co. in its amended application has attempted to follow the
Commissions lead in proposing rates that allocate the revenue requirement
evenly across the classes of customers while at the same time making the
proposed rates easy to understand by rounding to whole dollars and cents
father than fractions of a cent.
Respectfully submitted this day of August 2008.
RESPONSE TO DISCOVERY REQUEST
OF GREENE TRE INC. 4 August 20, 2008
Case No.
U-1147-6
Cae No.
U-1147-6
Reconsideration
Case No.
ATl-E-91-1
Rae
ScheduleReal
Customer Chg
Hydro Power
Diesel Power
Commrcial
Customer Chg
Hydro Power
Diesel Power
Rate
Schedule
Reidentl
Customer Chg
HydroPower
Diesel Power
Commercl
Customer Chg
HydroPower
Diesel Power
ATLANTA POWER COMPANY
Historical Base Rate Comparisons
(Excludes Separate Surcharges)Company PUC
Proposed ApprovedRates Rates *
$30/Month
$O.l13/KWh
$O.17/KWh
$l00/Month
$O.113/KWh
$0.17/KWh
$50/Month
$O.068/KWh
$0.12/KWH
500 Kwh / Month
$25/Month
$O.12/KWH
PUC
Approved
categories *
Minimum Bil
Over Allowance
Winter over 1.00 KWh / Mo.
KWh Allowance New
Seasonal Cust Chg New Sch 3
Seasonal aU KWh New Seh 3
$100 / Month Minimum Bil
$0.068/ KWh Over AHowace
$0.12/ KWH Winter over 1,00 KWh / Mo.
500 KWh / Month KWh Allowance New
$25/ Month Seasonal Cust Chg New Sch 3
$0.12/ KWH Seasonal all KWh New Sch 3
* See Order 21928 effctiv June 1, 1988
Company
Proposed
Rates
$30/Month
$0.113/KWh
$0.17/KWh
$l00/Month
$O.113/KWh
$O.17/KWh
PUC
Approved
Rates **
$5O/Month
$O.as/KWh
$O.12/KWH
50 KWh / Month
$25/Month
$0.12/KWH
$15/Mo
PUC
Approved
categories * *
MlnjmumBil
Over Allowance
Winter over 1,00 KWh / Mo.
KWh Allowance
Sesonal Cust Chg
Seasonal all KWh
7 Month Surcharge
$100 / Month Minimum Bill
$0.06/ KWh Over Allowance
$0.12/ KWH Winter over 1.00 KWh / Mo.
50 KWh / Month Kwh Allowance
$50 / Month Seasonal Cust Chg
$0.12/ KWH Seasonal all KWh
** See Order 22167 effecive November 1. 1988
Temporary Surcarge $0.1023/ KWh All Schedules, All KWh
Order 23740 efecive June. July & August 1991
Surcharge Continued $0.1023/ KWh All SChedules. All KWh
Bench Ruling August 29. 1991 effective Sept 91 Through Aug 92
See Order No. 23895
Suspend Winter
Excess Charge -$0.12/ KWH Winter over 1,00 KWh / Mo.
Order No. 23935 effective November 1. 1991
case No.
ATl-£93-1
REPLY TO GREENE TREE
DISCOVERY REQUEST
Resenial
Minimum Bil
Over Allowance
Winter over 1,00 KWh / Mo.
KWh Allowance
Seasonal Cust Chg
Seasonal all KWh
COa!
Minimum Bil
Over Allowance
Winter over 1,00 KWh / Mo.
KWh Alloance
Seasonal Cust Chg
Seasonal all KWh
Existing
Rates
$5O/Month
$O.OS/KWh
$0.12/KWH
500 KWh / Month
$25/Month
$O.12/KWH
PUC
Approved
Rates ***
$81/Month
$0.05/KWh..
500 KWh / Month.
$3S/Month
$0.12/KWH
$100 / Month $144/ Month
$0.068/ KWh $0.18/ KWh$O.12/KWH ..
50 KWh / Month 500 KWh / Month
$50/ Month $65 / Month
$0.12/ KWH $0.21/ KWH
*** Order No. 24925 effective June 15. 1993
ATTACHMENT "An
ATl-E-D8-2
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS DAY OF AUGUST, 2008,
SERVED THE FOREGOING REPLY TO GREENE TREE INC. DISCOVERY
REQUEST, IN CASE NO. ATL-E-08-2, BY HAND DELIVERY OF A COPY THEREOF
TO THE FOLLOWING:
SCOTT WOODBURY
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720-0074
BOISE, IDAHO 83720
DEAN J. MILLER
MCDEVITT & MILLER LLP
PO BOX 2564
BOISE, IDAHO 83701
~
Israel Ray, President
Atlanta Power Co. Inc.