20250522Final_Order_No_36613.pdf

Office of the Secretary
Service Date
May 22,2025
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE ELECTRIC ) CASE NO. AVU-E-25-04
LINE EXTENSION SCHEDULE 51 )
ANNUAL RATE ADJUSTMENT FILING )
OF AVISTA CORPORATION ) ORDER NO. 36613
On March 31, 2025, Avista Corporation dba Avista Utilities ("Company") applied to the
Idaho Public Utilities Commission ("Commission") for approval of an update in costs and
administrative changes to the Company's Electric Line Extension Schedule 51 ("Schedule 51").
The Company requested a May 15, 2025, effective date.
On April 22, 2025, the Commission issued a Notice of Application,Notice of Suspension
of Proposed Effective Date, and Notice of Modified Procedure, establishing a May 5, 2025,
deadline for public comments, and a May 15, 2025, deadline for the Company to file reply
comments. Order No. 36566. Commission Staff("Staff") filed comments on May 5, 2025. The
Company filed reply comments on May 5, 2025. One late filed comment was filed by the public.
Having reviewed the record, we issue this Final Order approving the Company's
Application with modifications.
THE APPLICATION
The Company represented that Schedule 51 incorporates average costing for electrical
facilities commonly used to extend service. Application at 2. 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.Id. These Basic and Exceptional Costs apply to facilities like transformers
and conduit and are based on recent average costs. Id. The Company represented that average
costing works well and the Company did not propose to change the conceptual structure of the
tariff in the Application. Id.
The Company represented that, in compliance with Order No. 35757, the Company
included workpapers detailing the "hours, materials, and vehicle support for each job."Id. Actual
work order estimates were also included for each job type. Id.
The Company updated the allowances for new residential, industrial, and commercial
customers' services. Id. at 3. The updated allowances were based on an embedded cost method
which seeks to ensure investments in facilities for new customers will be similar to the embedded
ORDER NO. 36613 1

costs of the same facilities reflected in base rates.Id. Costs that exceed the allowance must be paid
by the customer and are booked as a contribution in aid of construction. Id. The embedded costs
were based on the cost-of-service study used for the Settlement approved in Case No.AUV E-23-
01.Id. The proposed changes were as follows:
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 21/21 per kWh $ 0.17749 $ 0.18388
Schedule 31/32 per kWh $ 0.31838 $ 0.32929
Id.
The Company did not propose updating the Construction and Material Standards because
the Company believed that the current standards comply with and reflect the most recent National
Electric Safety Code.Id. at 3-4. The Company proposed to update the primary, secondary, service,
and transformer average cost as follows:
Present! Proposed
Overhead Primary Circuit
Fixed Cost $ 5,379 $ 5,536
Variable Cost $ 10.69 $ 11.20
Underground Primary Circuit
Fixed Costs $ 2,516 $ 2,583
Variable Costs $ 13.48 $ 13.55
Underground Secondary Circuit
Fixed Costs $ 666 $ 647
Variable Costs $ 14.17 $ 12.75
Overhead Secondary Circuit
Fixed Costs $ 2,212 $ 2,279
Overhead Service Circuit $ 5.02 $ 5.06
Underground Service Circuit $ 10.46 $ 10.29
Overhead Transformer $ 5,025 $ 5,308
Padmount Transformer $ 8,413 $ 10,003
Id. at 4.
'The Company's Application mistakenly included the term"Proposed"in this column.
ORDER NO. 36613 2

The Company stated that the primary driver of higher costs was increased transformer and
labor costs. Id. With respect to transformer costs, the Company noted that the demand for
transformers outpaced supply and significant cost increases drove transformer prices upward. Id.
at 5. With respect to labor costs, the Company stated that in 2024, the Company's Distribution
Standard Group reviewed labor hours and codes applied to the compatible units within the
Company's work management system and found that certain compatible units needed to be
updated to modify the crew hours to more accurately reflect actual labor costs. Id. The Company
stated that the labor hour update affected the underground transformer compatible unit because the
system was assigning a labor value of three man-hours for one installation crew, when the
installation crew has four workers, and therefore 12 hours should have been applied.Id.
The Company proposed updating its residential development costs to reflect the most
current Construction and Material Standards and average 2024 construction costs as follows:
Residential Developments Present Proposed
Total Cost per Lot $ 3,358 $ 3,849
Less: Service Cost $ 525 $ 516
Developer Responsibility $ 2,833 $ 3,333
Developer Refundable Payment $ 2,475 $ 2,545
Builder Non-Refundable Payment $ 883 $ 1,304
Allowance $ 2,475 $ 2,545
Id. at 6.
The Company proposed adding an application fee of$1,000 for load requests of 3,000 kVA
(3 MVA) or greater, to reflect the 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 would be paid in full by the customer requesting service. Id. The
Company stated that both changes align with industry practices among other utilities.Id.
STAFF'S COMMENTS
Staff reviewed the Company's Application and attachments, and Staff recommended the
Commission approve the Company's update to average costs and construction allowance for
Schedule 51. Staff Comments at 2.
Staff compared the proposed average costs and construction allowances to the current
average costs and construction allowances that were approved in Case No.AVU-E-24-05, Order
No. 36182.Id. at 2-3. Staff stated that all of the cost increases were reasonable, including the cost
of transformers, which exhibited the largest cost increase. Id. at 3. Staff believed that the increase
ORDER NO. 36613 3

in transformer cost was 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. Id.
Staff also verified the Company's request to update the required labor hours to install a padmount
transformer. Id. at 4. Staff believed the increase in the number of man-hours was reasonable and
that the cause was due to legitimate Company oversight. Id.
Staff verified that the proposed updated residential development costs were a result of the
proposed changes in the standard or basic development costs and allowances to reflect 2024
material and labor costs. Id. at 5. Staff believed that the increase in the developer responsibility
cost was reasonable. Id.
Staff reviewed the proposed administrative changes, including the $1,000 proposed
application fee and the cost of additional impact studies. Id. at 5-6. Staff believed that the cost of
the application fee for large loads had a cost basis and was reasonable, and that customers who
require impact studies for their line extension should pay the cost. Id. at 6. Staff verified that the
steps and costs involved in processing a large load application for load requests of 3 MVA or
greater was approximately equal to the cost of the proposed $1,000 application fee. Id. However,
Staff stated that the language in the proposed tariff regarding the impact studies was not clear. Id.
While Staff agreed that charging customers for the actual cost of an impact study is aligned with
industry practice, Staff recommended the proposed language of the tariff be updated to include"all
customers."Id.
Staff reviewed the Company's notice that was sent to impacted customers and Staff
believed it 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.Id.
PUBLIC COMMENTS
The Commission received one late filed comment from the public. The public comment
was opposed to the increased charges— specifically the builder non-refundable payment increase
and the developer contribution increase. The comment argued that the cost increases would pose
a significant burden on project feasibility and long-term housing affordability. The comment also
requested that the Company and the Commission consider the regional impact of these increases
and seek solutions that support infrastructure needs and the goal of sustainable, affordable housing
development.
ORDER NO. 36613 4

COMPANY REPLY COMMENTS
The Company supported Staff's recommendation that the Company submit a compliance
filing updating the tariff language to include "all customers" with a load request who require an
impact study pay for the cost. Company Reply Comments at 1.
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, Public Comments, and the Company's Reply Comments. Based on its
review of the record, the Commission finds it fair,just, and reasonable to approve the Company's
Application to update costs to Schedule 51, with modification. We also find that Staff's
recommendation to update the tariff language to include "all customers" with a load request who
require an impact study pay for the cost is reasonable.The Company shall submit the updated tariff
language as a compliance filing in this case.
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 shall update the tariff language to include
"all customers" with a load request who require an impact study pay for the cost. The Company
shall submit the updated tariff language as a compliance filing in this case.
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
reconsideration, any other person may cross-petition for reconsideration. See Idaho Code § 61-
626.
ORDER NO. 36613 5

DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 22°d day of
May 2025.
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I:\Legal\ELECTRIC\AVU-E-25-04_Sch 51\orders\AVUE2504_final_em.docx
ORDER NO. 36613 6