20250505Staff Comments.pdf

RECEIVED
Monday, May 05, 2025
ERIKA K. MELANSON IDAHO PUBLIC
DEPUTY ATTORNEY GENERAL UTILITIES COMMISSION
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 11560
Street Address for Express Mail:
11331 W CHINDEN BLVD, BLDG 8, SUITE 201-A
BOISE, ID 83714
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE ELECTRIC LINE )
EXTENSION SCHEDULE 51 ANNUAL RATE ) CASE NO. AVU-E-25-04
ADJUSTMENT FILING OF AVISTA )
CORPORATION )
COMMENTS OF THE
COMMISSION STAFF
COMMISSION STAFF ("STAFF") OF the Idaho Public Utilities Commission
("Commission"), by and through its Attorney of record, Erika K. Melanson, Deputy Attorney
General, submits the following comments.
BACKGROUND
On March 31, 2025, Avista Corporation, doing business as Avista Utilities ("Company")
filed an application("Application") with the Commission for an order approving the update in
costs and administrative changes to the Company's Electric Line Extension Schedule 51. The
Company requested an effective date of May 15, 2025, and that its filing be processed by
Modified Procedure.
The Company updated the allowances for new residential, industrial, and commercial
customers' services. Application at 3. The Company based the updated allowances on an
STAFF COMMENTS I MAY 5, 2025

embedded cost method that seeks to ensure investments in facilities for new customers and track
embedded costs included in base rates. Id. The Company proposes to update the Primary
distribution, Secondary distribution, service line extension, and transformer average cost. Id. at
4-6. The residential development costs changed to reflect the most current Construction and
Material Standards and average 2024 construction costs. Id. at 6. The Company proposes to add
an application fee of$1,000 for load requests of 3 megavolt-amperes ("MVA") or greater, in an
effort to reflect the considerable amount of time, effort, and complexity to evaluate large load
requests. Id. The Company also added language to clarify that any additional capacity impact
studies beyond standard design will be paid in full by the customer who is requesting the service.
Id.
STAFF ANALYSIS
Staff reviewed the Application and attachments, comparing the proposed costs to the
approved costs in Case No. AVU-E-24-05, Order No. 36182. Based on the review, Staff
recommends the Commission:
l. Approve the updated costs and allowances, as filed;
2. Approve the $1,000 application fee for load requests of 3 MVA or greater; and
3. Direct the Company to submit a compliance filing updating the tariff language to
include "all customers" with a load request who require an impact study to pay for the
cost.
Additionally, Staff believes that the customer notice meets the requirements of Rule 125
of the Commission's Rules of Procedure (IDAPA 31.01.01).
Construction Allowances
The Company updated the allowances applicable to new residential, commercial, and
industrial customers' services. The Company continues to use an embedded cost method for
calculating the revised allowances that are designed to ensure similar investment in
distribution/terminal facilities as those in current facilities reflected in base rates. Table No. 1,
below, summarizes the proposed allowance changes.
STAFF COMMENTS 2 MAY 5, 2025

Table No. 1. Proposed Allowance Changes
Service Schedule Existing Proposed
Schedule 1 Individual Customer (per unit) $ 2,475 $ 2,545
Schedule 1 Duplex (per unit) $ 1,980 $ 2,035
Schedule 1 Multiplex (per unit) $ 1,490 $ 1,530
Schedule 11/12 (per kWh) $ 0.19321 $ 0.19912
Schedule 21/22 (per kWh) $ 0.17749 $ 0.18388
Schedule 31/32 (per kWh) $ 0.31838 $ 0.32929
Average Costs
The Company proposed to update the primary, secondary, service, and transformer
average costs as described on tariff sheets 5 1 H and 511. To determine if the increases were
justified, Staff compared the proposed average costs to the current average costs that were
approved through Order No. 36182, as shown in Table No. 2. Staff believes all of the cost
increases (including some costs that decreased) were reasonable, including the cost of
transformers, which exhibited the largest cost increase.
When the updated costs are compared to the current approved costs, the overhead
transformer and padmount transformer costs increased by 5.63% and 18.90%, respectively. In
response to Production Request No. 1, the cost of a 25kVA transformer increased by 36.6% from
$4,820 to $6,586. The Company states that the increase in transformer costs is a national
problem due to high demand and low availability. Application at 5. Staff believes these
increases are consistent with other transformer cost increases that were recently provided by
other utilities, such as those reported by Idaho Power in Case No. IPC-E-25-01. The Company
states that it has been attempting to mitigate these costs by working with different vendors to
source the transformers both on availability and through cost-saving efforts. Application at 5.
See also response to Production Request No. 1.
STAFF COMMENTS 3 MAY 5, 2025

Table No. 2: Proposed Average Cost Changes
Costs Existing Proposed Increase Rate
Overhead Primary Circuit
Fixed Cost $ 5,379 $ 5,536 2.92%
Variable Cost $ 10.69 $ 11.2 4.77%
Underground Primary Circuit
Fixed Cost $ 2,516 $ 2,583 2.66%
Variable Cost $ 13.48 $ 13.55 0.52%
Underground Secondary Circuit
Fixed Cost $ 666 $ 647 -2.85%
Variable Cost $ 14.17 $ 12.75 -10.02%
Overhead Secondary Circuit
Fixed Cost $ 2,212 $ 2,279 3.03%
Overhead Service Circuit $ 5.02 $ 5.06 0.80%
Underground Service Circuit $ 10.46 $ 10.29 -1.63%
Overhead Transformer $ 5,025 $ 5,308 5.63%
Padmount Transformer $ 8,413 $ 10,003 18.90%
Labor cost also contributed to the increase in the cost of installing a padmount
transformer. Application at 5. The Company discovered it needed to update the required labor
hours from 2.69 hours to 12.19 hours, resulting in a 400% increase in labor costs. Id. at 5-6. The
current labor costs to install a padmount transformer accounted for one installation crew taking
three-man hours to complete the work. Id. The costs did not consider that one installation team
in comprised of a four-man crew, totaling 12 hours of work to complete the installation. Id.
Staff believes the increase in the number of man-hours is reasonable and that the cause was due
to legitimate Company oversight.
STAFF COMMENTS 4 MAY 5, 2025

Residential Developments
The Company proposed updated residential development costs as shown in Table No. 3
below. Id. at 6. The developer responsibility cost increased by 17.65%. The increase is a result
of the proposed changes in the standard or basic development costs and allowances to reflect
2024 material and labor costs. Staff believes that the increase in the developer responsibility cost
is reasonable.
Table No. 3: Proposed Residential Development Cost Changes
Residential Development Existing Proposed Increase Rate
Total Cost per Lot $ 3,358 $ 3,849
Less: Service cost $ 525 $ 516 -1.71%
Developer Responsibility $ 2,833 $ 3,333 17.65%
Developer Refundable Payment $ 2,475 $ 2,545
Builder Non-Refundable Payment $ 883 $ 1,304
Allowance $ 2,475 $ 2,545
Administrative Changes
The Company proposed two administrative changes and corresponding changes to the
Company's Schedule 51 tariffs: (1) an application fee of$1,000 for load requests of 3 MVA or
greater, and (2) language to clarify that any capacity impact studies beyond standard design
should be paid by customers requesting service. Id. at 6-7. Staff believes that the cost of the
application fee for large loads has a cost basis and is reasonable, and that customers who require
impact studies as a result of their line extension should pay the cost. Staff recommends the
Commission approve both of these changes. However, the language in the proposed tariff
regarding the impact studies was not clear. Thus, Staff further recommends the Company submit
a compliance filing that clarifies the language in the tariff to include all customers, within 30
days of the final Commission order.
Staff requested and verified that the steps and costs involved in processing a large load
application for load requests of 3 MVA or greater was approximately the cost of the proposed
$1,000 application fee. Response to Production Request No. 2. Staff also requested information
STAFF COMMENTS 5 MAY 5, 2025

on why this was only limited to customers with load requests of 3 MVA or higher. The
Company explained that the 3 MVA threshold is aligned with Schedule 25, Extra Large General
Service customers and that processing requests less than 3 MVA requires significantly less time
and effort to interconnect these loads and the Company did not believe it was appropriate to
charge a significant application fee for smaller size load requests. Id. However, the Company
did commit to re-evaluating the amount of the application fee in future filings. Id.
The Company also proposed that "[fJor large load requests, the actual costs of any
additional system impact studies will be paid by the customer." Application- Proposed Tariff
Fourth Revision Sheet 51 M. Staff requested clarification regarding the size threshold that
constitutes a large load. The Company stated that it intends that all customers should pay the
actual cost of the additional system impact studies, regardless of the size of the system, if the
impact studies are required. Response to Production Request No. 3. The Company stated and
Staff agree that charging customers for the actual cost of an impact study is aligned with industry
practice. Application at 7. Staff verified that similar costs are charged to customers requiring
impact studies by Idaho's two other large investor-owned electric utilities. This prevents these
costs from being borne by the utilities' existing customers. However, the proposed language in
the tariff specifies that these charges be limited to large load requests. Staff recommends the
Commission order the Company to submit a compliance filing to update the tariff language to
include all customers.
Consumer Notice
The Company's customer notice was included with its Application. Staff reviewed the
document and determined that it meets the requirements of Rule 125 of the Commission's Rules
of Procedure(IDAPA 31.01.01). The notice was mailed to the relevant customers on April 18,
2025, providing a reasonable opportunity to file timely comments with the Commission by the
May 5, 2025, comment deadline. As of May 5, 2025, the Commission has received no
comments from customers.
STAFF COMMENTS 6 MAY 5, 2025

STAFF RECOMMENDATION
Staff recommends the Commission:
1. Approve the updated costs and allowances as filed;
2. Approve the $1,000 application fee for load requests of 3 MVA or greater; and
3. Direct the Company to submit a compliance filing updating the tariff language to
include "all customers" with a load request who require an impact study to pay for the
cost.
Respectfully submitted this 5th day of May 2025.
Erika K. Melanson
Deputy Attorney General
Technical Staff. Seungjae Lee
Leena Gilman
Curtis Thaden
I:\Utility\UMISC\COMMENTS\AVU-E-25-04 Comments.docx
STAFF COMMENTS 7 MAY 5, 2025

CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS _,.DAY OF MAY 2025,
SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF , IN CASE
NO. AVU-E-25-04, BY &MAILING A COPY THEREOF TO THE FOLLOWING:
PATRICK EHRBAR DAVID J. MEYER
DIR OF REGULATORY AFFAIRS VP & CHIEF COUNSEL
AVISTA CORPORATION AVISTA CORPORATION
PO BOX 3727 PO BOX 3727
SPOKANE WA 99220-3727 SPOKANE WA 99220-3727
E-mail: patrick.ehrbarnavistacorp.com E-mail: david.meyergavistacorp.com
avistadocketsgavistacorp.com
PATRICIA JORDAN, CRETARY
CERTIFICATE OF SERVICE