20250603Final_Order_No_36628.pdf

Office of the Secretary
Service Date
June 3,2025
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION ) CASE NO. PAC-E-25-05
OF ROCKY MOUNTAIN POWER FOR A )
DEFERRED ACCOUNTING ORDER )
RELATED TO CHEHALIS COMPLIANCE ) ORDER NO. 36628
COSTS )
On March 28, 2025, Rocky Mountain Power, a division of PacifiCorp, ("Company")
applied for an accounting order authorizing the Company to record a regulatory asset associated
with the Company's 2024 Energy Cost Adjustment Mechanism(`SCAM)for approximately$2.33
million in costs the Company incurred to comply with the Washington Climate Commitment Act
("WCCA").
On April 25,2025,the Commission issued a Notice of Application and Notice of Modified
Procedure, establishing public comment and company reply deadlines. Order No. 36580. Staff
filed comments to which the Company replied.
Having reviewed the record, the Commission issues this Order approving the Company's
Application as follows.
BACKGROUND
The Company's appeal of the Commission's Order Nos. 36207 and 36367, in which the
Commission disallowed recovery of$2.3 million in costs the Company incurred to comply with
the WCCA in the Company's 2023 ECAM, is currently pending before the Idaho Supreme Court.
Consequently, depending on the Court's decision, there is a possibility that the Company will be
allowed to recover its 2023 compliance costs for the WCCA in Idaho rates. The Company states
it filed its 2024 ECAM and excluded WCCA compliance costs from its filing since the outcome
of the appeal with the Idaho Supreme Court is unknown. This will allow the 2024 ECAM
proceeding to conclude more efficiently.
THE APPLICATION
The Company proposes tracking its 2024 WCCA compliance costs in a separate deferral
account. Once the Idaho Supreme Court issues its opinion in the appeal of Order Nos. 36207 and
36367, the Company will seek recovery of these costs, if appropriate. The Company estimates
ORDER NO. 36628 1

Idaho's share of the WCCA compliance costs it incurred during the 2024 ECAM deferral period
to be about $2.33 million.
STAFF COMMENTS
Staff reviewed the Company's Application, its supporting documents, documentation of
2024 WCCA compliance costs, and information about the pending appeal to the Idaho Supreme
Court. Staff agreed with the Company's plan to defer WCCA costs in a separate regulatory deferral
account until the Court makes a final decision in the appeal of Order Nos. 36207 and 36367.
However, Staff also recommended that no interest or carrying charges be added to the deferred
balance.
Staff believed that removing the WCCA costs from the 2024 ECAM filing benefits
everyone. Considering prior Commission decisions denying recovery of WCCA costs, the
Commission almost certainly would have denied recovery of such costs had the 2024 ECAM filing
requested them. Thus, Staff reasoned that excluding WCCA costs from the 2024 ECAM simplifies
this case and streamlines the review process. Deferring 2024 WCCA compliance costs also
benefits customers by reducing ECAM rates and avoiding additional legal costs from a potential
second appeal to the Idaho Supreme Court.
Although not expressly addressed in the Application, Staff opposed any request to apply a
carrying charge to the deferral balance. By removing WCCA costs from the ECAM,the Company
avoids certain administrative and regulatory expenses. Thus, Staff asserted that adding a carrying
charge to the deferral would give the Company an unjustified financial benefit.
COMPANY REPLY COMMENTS
The Company opposed only Staff's recommendation to prohibit a carrying charge on the
deferred WCCA costs. The Company argued that a carrying charge is appropriate as compensation
for the time value of money the Company spends on costs incurred on behalf of customers that are
not immediately recovered in rates. Thus,according to the Company,the lack of a carrying charge,
the Company would be providing interest-free financing for 2024 WCCA compliance costs,which
is not equitable. Because deferred costs are not included in current rates, carrying charges help
recover reasonable financing expenses, such as loan interest, that the utility may incur.
The Company further argued that allowing a carrying charge on deferred WCCA-costs is
consistent with Commission precedent. The ECAM deferral balance has a Commission approved
carrying charge of the customer deposit rate. The Company characterized the deferred WCCA
ORDER NO. 36628 2

costs as net power costs for which the Commission typically allows a carrying charge. The
Company asserted that denying a carrying charge solely because the WCCA costs are subject to a
pending Idaho Supreme Court appeal is contrary to the public interest. Despite acknowledging that
deferring WCCA costs results in more efficient proceedings, the Company asserted that any
savings generated by these administrative efficiencies do not compensate the Company for the lost
time value of money while recovery is delayed.
DISCUSSION AND FINDINGS
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.
Based upon our review of the record, we find it reasonable to grant the Company's request
to track its 2024 WCCA compliance costs in a separate deferral account. Considering our prior
disallowance of recovery of these costs in the 2023 ECAM in Order Nos. 36207 and 36367,
removing the Company's 2024 WCCA compliance costs from this year's ECAM simplifies this
case, facilitating a more efficient resolution. This benefits the Company and its customers by
reducing both the resources expended on this case and the overall deferral amount. However, we
further find that relieving the Company of the expense of requesting recovery of its 2024 WCCA
compliance in its ECAM filing and authorizing a carrying charge on those expenses would give
the Company an unjustified financial benefit. Accordingly,the Company is not granted a carrying
charge on the deferred 2024 WCCA compliance costs.
ORDER
IT IS HEREBY ORDERED that the Company's request for authorization to record a
regulatory asset for the approximately $2.33 million in costs the Company incurred during 2024
to comply with the WCCA is approved without a carrying charge.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days of the service date of 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. 36628 3

DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 3rd day of
June 2025.
G
Q
E WARD LODGE, PR IDENT
J R. HAMMOND JR., COMMISSIONER
DAYN HA IE, COMMISSIONER
ATTEST:
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Ba i - c z
Commission Secre ary
I ALegal\ELECTRIC\PAC-E-25-05_Chehalis\ordersTACE2505_final_at.docx
ORDER NO. 36628 4