HomeMy WebLinkAbout20060925min.docIDAHO PUBLIC UTILITIES COMMISSION
MINUTES OF DECISION MEETING
September 25, 2006 – 1:30 P.M.
In attendance were Commissioners Paul Kjellander, Marsha Smith and Dennis Hansen.
Commissioner Kjellander called the meeting to order. The first order of business was APPROVAL OF MINUTES FROM PREVIOUS MEETING on September 11, 2006. Commissioner Kjellander moved to approve the minutes. A vote was taken on the motion and it carried unanimously.
The second order of business was approval of the CONSENT AGENDA. Commissioner Kjellander announced that if there were no objections, item 12 would be moved under the heading of MATTERS IN PROGESS. There were no objections. Commissioner Kjellander moved for approval of the remaining Consent Agenda items 2 – 11 and 13. There was no discussion. A vote was taken on the motion and it carried unanimously.
The next order of business was MATTERS IN PROGRESS:
Scott Woodbury’s September 20, 2006 Decision Memorandum re: Case No. IPC-E-06-21 (Idaho Power), Cassia Wind Farm LLC et al. v. Idaho Power.
Mr. Woodbury reviewed his Decision Memo. He stated he had proposed a procedure for processing the case, essentially adopting what had been proposed by Cassia Wind Farm but limiting the scope to the policy procedural question as to whether it is appropriate for QFs to pay for transmission upgrades. He said Idaho Power has some concerns with respect to how this case will be framed and asked for the opportunity to address the Commission. He said Idaho Power contends the issue should be procedurally addressed by the Commission in the same manner as a Motion for Summary Judgment, assuming the company’s engineering study and planning assumptions are true. Mr. Woodbury stated that the company’s proposal makes sense to staff and from a decision perspective provides the quickest route to an early preliminary policy decision by the Commission. He noted that the policy decision would be preliminary because the matter is not being submitted as binding arbitration. He said there are other parties interested in the issue, such as PacifiCorp and Avista, because of the generic policy implications. He noted this is an avoided cost QF that has an approved contract, and avoided costs do not include a transmission element. He added that if it weren’t for the request for interconnects in the Magic Valley, Idaho Power would not be required to make the upgrades it believes are necessary.
Bart Kline of Idaho Power then addressed the Commission. He said he wanted to make it clear that Idaho Power understands Cassia Wind’s desire to move expeditiously in this case because it is running up against a limit on tax credits. He said the company thinks it is possible to process at least the first phase of the case on a paper record, but cautioned that the Commission should proceed very carefully in structuring the procedure used to process the case. He said it is hard to convey in a Decision Memo the magnitude of the policy questions that the Commission is going to be asked in this proceeding. He said it is more than just whether costs can be allocated to QFs connected to the system but whether they should be. He said there are legal issues associated with whether the costs can be allocated to QFs and policy issues as to whether the Commission should assess those costs. He said the “should” part is a big one, and depending upon how the Commission decides the case, it can have a large impact on how transmission dollars are spent, whether they are going to be spent in locations determined by where QF projects develop or whether they are going to be spent in other areas subject to prior review, and there are a number of FERC issues as well. Mr. Kline stated that one of Idaho Power’s concerns is that there ought to be a presumption on the part of the Commission when it makes a policy decision in this case that Idaho Power is correct in its analysis of the engineering issues and the costs associated with that kind of construction, and if the Commission makes that assumption that solves part of the company’s problem. He said as far as Idaho Power is concerned, from a procedural standpoint it might sense for the parties to spend a period of time with some of the intervenors and other interested parties to make sure the case is well framed because the last thing the company wants is to have a record that is not adequate to stand review at the Idaho Supreme Court. He said any time you do things on modified procedure, where you have a big policy question like this one, you need to make sure to have the best record possible for defense at the Supreme Court.
Commissioner Smith asked if there is any way for the Commission to have an expedited process to determine the answer to this question for Cassia Wind without setting in stone the policy of the Commission for other projects.
Mr. Kline said he hasn’t been able to see how the Commission would do that just for this project. He said the problem is there are a cluster of projects that are driving these costs. If the Commission makes a policy decision for Cassia, it is probably making a policy decision for others.
Commission Hansen asked if he thought the other two IOUs would be involved in this case. Mr. Kline said there is a good chance they will be interested in participating because it would set a policy that would direct where transmission dollars are spent.
Mr. Woodbury said he has talked with attorneys for both PacifiCorp and Avista and they are interested in the issues raised in the case and have indicated they will follow the case, and if they believe they can provide information to help the Commission make a more informed decision they will do so.
Joe Miller, attorney for Cassia Wind, addressed the Commission. He said in preparing the pleadings, they made every effort to present the issue in a straight forward way that could be decided in a relatively expedited schedule, but not require the resolution of any disputed factual issues. Mr. Miller said that from Mr. Kline’s comments, he takes it that the company feels Cassia may have crossed the line between law and policy on one hand and facts on the other in a couple of instances, but it seemed to him that can be resolved by an appropriate pleading—i.e. if the company feels Cassia Wind has presented things that shouldn’t be considered in this context it can raise that issue in an appropriate pleading. Mr. Miller said Cassia’s suggestion at this point would be for the Commission to provide them with some general guidance, such as by agreeing this is a matter that should be processed on a schedule something like that proposed in their initial complaint. He said if the Commission could provide just that guidance at this point they would be prepared to follow up with Mr. Kline’s suggestion to work out a schedule that fits within the Commission’s guidance or adopt the proposed schedule.
Commissioner Hansen asked about the tax credit and if there is a time table in regard to those tax benefits. Mr. Miller referred the Commission to the affidavit filed by Mr. Grover in support of his complaint, where the urgency is explained.
Commissioner Smith asked Mr. Kline how his suggestion that this be handled as a Motion for Summary Judgment differs from the schedule that Cassia proposed with the 30-day period that includes arguments, legal authorities and a 14-day reply period with an oral argument thereafter. Mr. Kline replied that it doesn’t necessarily conflict with that, but what’s important is that the Commission indicate to Idaho Power how it is going to review these issues so it knows what to put in and what not to put in. Commissioner Smith said the Commission would review them thoroughly. Mr. Kline said it depends to some extent on what Idaho Power presents to the Commission as to how it is going to view some of those issues.
Mr. Miller responded that it may be difficult for the Commission to pre-define what Mr. Kline is asking for and it may be better to simply require the filing of responsive pleadings that the Company thinks appropriate, and likewise Cassia Wind would have the opportunity in its reply pleadings to question whether the Company had improperly injected factual issues. He said it seemed to him they could proceed much along the lines of Cassia’s suggested schedule and resolve those problems if and when they come up.
Commissioner Smith asked Mr. Kline if the 30-day comment period was necessary and if it would take Idaho Power that long to prepare its response. Mr. Kline replied that there is no question that it will. He said in Mr. Woodbury’s Decision Memo, it says the engineering and planning assumptions of Idaho Power and its underlying claim that system upgrades are in fact necessary are not at issue. He said he is not sure it is sufficient simply to say those aren’t at issue. He stated if the Commission is going to make a policy decision then in order to do that, it has to assume that Idaho Power is correct in its assumptions and with that then established, it can decide. He said it can be done on a paper record if we have that kind of basis for the Commission to start its consideration.
Commissioner Smith asked if Cassia is disputing the fact that the company did this study. Mr. Kline said there are portions of their pleading that question those assumptions by Idaho Power.
Mr. Miller said there is one footnote in both the Complaint and the Memorandum that refers to Idaho Power’s planning and engineering design assumptions, which indicates that this case would proceed to a phase two when those things become an issue, and Cassia would in all likelihood dispute those assumptions. Commissioner Smith confirmed that Cassia Wind wants the right to dispute Idaho Power’s numbers if the Commission determines on a policy level that wind developers do have to pay. Mr. Miller replied that she was correct—Cassia Wind didn’t want to file a pleading that conceded that issue for all time and foreclosed future litigation ability. He said if the Commission reaches the policy decision that those costs are primarily assignable to Cassia, then the question of what is the correct quantity of those costs would have to be resolved, but that is not an issue before the Commission now. In answer to a question by Commissioner Kjellander, Mr. Miller replied that Mr. Grover’s affidavit indicates that if at the end of that two-step process the costs at the magnitude requested by Idaho Power were assigned to Cassia, it would have a materially adverse result and likely render the projects infeasible.
Commissioner Smith made a motion that the Commission adopt the process suggested in the Decision Memo with a 30-day comment period for Idaho Power to respond and a 14-day period for reply briefs or memorandums, then the Commission may have enough information to answer the policy question of how to assign these costs, and in its Order the Commission can also designate further process or not, depending upon how it sees things at that time. There was no further discussion. A vote was taken on the motion and it carried unanimously.
Cecelia Gassner’s September 22, 2006 Decision Memorandum re: Avista’s Application to Increase the Company’s Energy Efficiency Tariff Schedule 191, Case No. AVU-G-06-04.
Ms. Gassner reviewed her Decision Memo. She said staff would like to modify the recommendation in the memo so that the procedure for this matter coincides with the schedule proposed for the Avista PGA matter. She said the decision is whether to proceed by modified procedure to coincide with the PGA. Commissioner Smith asked what the PGA schedule is. Ms. Gassner replied that comments are to be filed by October 24 with an effective date of November 1st.
Commissioner Kjellander made a motion to approve Staff’s modified recommendation for the matter to coincide with the PGA. A vote was taken on the motion and it carried unanimously.
Don Howell’s September 20, 2006 Decision Memorandum re: The Commission’s Review of the Five New PURPA Standards Contained in the Energy Policy Act of 2005, Case No. GNR-E-06-02.
Mr. Howell reviewed his Decision Memo. There was no discussion. Commissioner Kjellander moved that the Commission issue another Notice of Modified Procedure with a 21-day comment period and a subsequent 14-day reply comment period. Commissioner Smith stated she supported the motion but noted that in order to avoid confusion, when the press release is issued it should be clear that this is not the same as Idaho Power’s case, which numerous people have already commented on. There was no further discussion. A vote was taken on the motion and it carried unanimously.
Donovan Walker’s September 19, 2006 Decision Memorandum re: Avista’s 2006 Purchased Gas Cost Adjustment (PGA), Case No. AVU-G-06-03.
Mr. Walker reviewed his Decision Memo. Commissioner Hansen stated that because the price of natural gas has decreased over the last month or so the public probably would benefit from a workshop in this case in order to understand why Avista is requesting this particular amount. He said he has received more comments lately from people wondering about the price of natural gas and how that is going to affect the PGA. He moved to process the case by modified procedure with a workshop conducted by Staff. He said after the workshop and after the Commission has received comments in this case, it can then be decided whether or not to hold a public hearing. Commissioner Smith asked if it is possible to conduct the workshop and get the comments by November 1st. Mr. Walker replied that the proposed comment deadline of October 24th is the latest possible date to have comments due and on the agenda by November 1st. Commissioner Smith suggested that if the Commission can hold the workshop sooner, then it should move up the comment deadline. There was no further discussion. A vote was taken on the motion and it carried unanimously.
Wayne Hart’s September 22, 2006 Decision Memorandum re: Rocky Mountain Power Petition to Confirm the Payment Structure of Schedule 21 (Low Income Weatherization), Case No. PAC-E-06-10.
Mr. Hart reviewed his Decision Memo. There was no discussion. Commissioner Kjellander made a motion to issue a Notice of Petition, schedule the informal conference to discuss dates and procedures, and to go ahead and grant CAPAI’s request for intervention. Commissioner Smith noted that this should be accomplished as quickly as possible. A vote was taken on the motion and it carried unanimously.
Commissioner Kjellander stated that items 18 –21 under the category of FULLY SUBMITTED MATTERS would be deliberated privately. He then adjourned the meeting.
DATED this _______ day of September, 2006.
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COMMISSION SECRETARY
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