20251105Direct Leyko.pdf

RECEIVED
NOVEMBER 5, 2025
IDAHO PUBLIC
UTILITIES COMMISSION
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF INTERMOUNTAIN )
GAS COMPANY'S APPLICATION FOR )
AUTHORITY TO INCREASE ITS RATES ) CASE NO. INT-G-25-02
AND CHARGES FOR NATURAL GAS )
SERVICE IN THE STATE OF IDAHO )
Direct Testimony of
James A. Leyko
in Support of the Stipulation and Settlement
On behalf of
Micron Technology, Inc.
November 5, 2025

Table of Contents
I. SUMMARY..................................................................................................................1
II. RECOMMENDATIONS ..............................................................................................2
Appendix A: Qualifications of James A. Leyko
Leyko, DI (Settlement) i
Micron Technology, Inc.

1 I. SUMMARY
2 Q PLEASE STATE YOUR NAME AND BUSINESS ADDRESS.
3 A James A. Leyko. My business address is 16690 Swingley Ridge Road, Suite 140,
4 Chesterfield, MO 63017.
5 Q WHAT IS YOUR OCCUPATION?
6 A I am a Senior Consultant in the field of public utility regulation with the firm of Brubaker
7 &Associates, Inc. ("BAI"), energy, economic and regulatory consultants.
8 Q PLEASE DESCRIBE YOUR EDUCATIONAL BACKGROUND AND EXPERIENCE.
9 A This information is included in Appendix A to my testimony.
10 Q ON WHOSE BEHALF ARE YOU APPEARING IN THIS PROCEEDING?
11 A I am appearing on behalf of Micron Technology, Inc. ("Micron"), a large customer of
12 Intermountain Gas Company ("IGC" or"Company").
13 Q WHAT IS THE PURPOSE OF YOUR TESTIMONY?
14 A The purpose of my testimony is to support the unanimous Stipulation and Settlement
15 ("Settlement') filed by the Company and the other parties to this proceeding on
16 October 20, 2025. The Settlement resolves all revenue requirement, class cost of
17 service, and rate design issues in this proceeding.
Leyko, DI (Settlement) 1
Micron Technology, Inc.

1 II. RECOMMENDATIONS
2 Q DO YOU RECOMMEND APPROVAL OF THE SETTLEMENT?
3 A Yes. I recommend approval of the Settlement. The Settlement is a comprehensive
4 agreement that represents give and take among the parties and resolves the revenue
5 requirement, cost allocation, and rate design issues that would have likely been raised
6 by the parties in this proceeding. The Settlement is a result of extensive arms-length
7 negotiations between the settling parties in order to reach a comprehensive settlement
8 of the issues presented. Notably, the Settlement is within the range of outcomes that
9 would have resulted from a litigated case.
10 In sum, the Settlement should be approved for the following reasons:
11 1. The stipulated overall revenue requirement will result in an overall level of revenue
12 for the Company that is just and reasonable and will allow the utility a reasonable
13 opportunity to earn a fair return on its investments. The revenue requirement
14 adjustments contained in the Settlement represent a compromise on the issues that
15 would have been contested in this case.
16 2. The stipulated revenue allocation reflects a compromise between the parties to
17 resolve the issues that would have been contested in this case and is reasonably
18 based on cost-of-service principles. The compromise revenue allocation in the
19 Settlement is within the range of what would have likely been the parties' litigated
20 positions in this case.
21 3. The stipulated rate design for the various customer rates is fair, reasonable, and in
22 the public interest.
23 4. The Settlement includes IGC's commitment to participate in a series of workshops
24 with the Settling Parties to include topics such as renewable natural gas, installation
25 and extension of mains and services, and class cost of service. The outcome of
26 these workshops will result in better data in future rate cases on which IGC and
27 interested parties can propose alternative revenue allocation and rate design
28 methodologies.
29 5. The Settlement is likely to reduce the Idaho Public Utilities Commission's
30 ("Commission") administrative burden and save rate case expenses for all parties.
Leyko, DI (Settlement) 2
Micron Technology, Inc.

1 Q PLEASE DESCRIBE THE SETTLEMENT'S RESOLUTION OF THE COMPANY'S
2 REVENUE REQUIREMENT IN THIS PROCEEDING.
3 A The Settlement resolves the revenue requirement issues that would have been raised
4 by parties in this rate case.
5 The Company's original filing in this docket proposed to increase base rate
6 revenues by $26.5 million, or a system average increase of 22.2%. Under the
7 Settlement, the increase in total revenue was reduced to $13 million, or a system
8 average increase of 10.4%, effective January 1, 2026.
9 The Settlement reflects several adjustments to the Company's originally filed
10 revenue requirement, which are summarized on page 3 and Exhibit 1 of the Settlement.
11 The Commission Staff ("Staff") and intervenors, including Micron, conducted robust
12 discovery prior to settlement discussions and provided a thorough and detailed
13 assessment of the Company's cost of service in settlement negotiations. Staff's and
14 the other intervenors' review and input was very useful in identifying and reaching an
15 agreement on the revenue requirement adjustments included in the Settlement.
16 Q DID MICRON HAVE CONCERNS ABOUT ANY SPECIFIC COMPONENTS OF THE
17 COMPANY'S PROPOSED REVENUE REQUIREMENT?
18 A Yes. Micron had several concerns with the Company's originally proposed revenue
19 requirement, which are resolved by the compromise represented in the Settlement.
20 First, Micron was concerned that the Company's proposed Return on Equity ("ROE")
21 of 10.8% was excessive based on current market conditions. Micron conducted an
22 independent analysis of the Company's proposed ROE and concluded that we would,
23 in the context of a litigated case, likely advocate for an ROE in the range of 9.20% to
24 9.80%. The Settlement provides for a reasonable compromise between these
25 positions and recommends the Commission approve a 9.50% ROE.
Leyko, DI (Settlement) 3
Micron Technology, Inc.

1 In addition, Micron had several other concerns with the Company's proposed
2 revenue requirement including the Company's measurement of rate base and the
3 inclusion of 2026 salary increases (which were outside the test year). Micron also had
4 questions about the treatment of any potential excess deferred income taxes and those
5 questions were answered in discovery and in settlement negotiations. In total, Micron
6 estimated that its adjustments related to these issues would have reduced the
7 Company's claimed revenue deficiency by at least the amount agreed to in the
8 Settlement. The adjustments are the same or incremental to other adjustments that
9 Micron understands that the Staff and other intervenors would have recommended.
10 The Settlement reflects several adjustments to the Company's originally filed revenue
11 requirement, some of which are summarized on page 3 of the Settlement. The
12 Settlement addresses several of Micron's various revenue requirement adjustments
13 and reflects a reasonable compromise of the various issues presented in this
14 proceeding and the parties' positions in those issues.
15 Q DID THE SETTLING PARTIES REACH AN AGREEMENT ON THE REVENUE
16 ALLOCATION?
17 A Yes. Settlement Exhibit No. 2 provides the parties' agreement regarding revenue
18 allocation. Settlement Exhibit No. 2 also identifies the settlement rates agreed to by all
19 settling parties. As particularly applicable to Micron, the Settlement provides for an
20 increase of approximately 6.46% for Micron's under the Firm Transportation Rate
21 Schedule T-4.
22 This outcome generally follows the results of the Company's class cost of
23 service study, with adjustments to recognize the need for gradualism for certain rate
24 classes. The Settlement reflects a cap of about 1.23 times the system average
25 increase, and a floor of 0.5 times the system average increase. The stipulated revenue
Leyko, DI (Settlement) 4
Micron Technology, Inc.

1 spread recognizes that the Company's class cost of service study concluded that the
2 T-4 class warranted a very small cost-based rate change compared to the system
3 average rate increase. In addition, Micron is satisfied with the rate design for Rate
4 Schedule T-4, as it generally reflects cost-based rates based on its preferred class cost
5 of service study methodology.
6 With regard to the other customer classes, Micron analyzed the Company's
7 class cost of service study and finds the revenue allocation reasonable based on the
8 class cost of service study proposed by the Company, including any adjustments to
9 that study that Micron would have proposed had this case been fully litigated.
10 Q DID THE SETTLING PARTIES AGREE UPON A PARTICULAR CLASS COST OF
11 SERVICE STUDY?
12 A No. The parties did not agree on any particular class cost of service methodology.
13 Instead, the Settling Parties negotiated a revenue allocation to adjust rates and charges
14 for each customer class.
15 Micron believes the Company's class cost of service study is generally
16 reasonable and accurately reflects cost-causation. However, Micron recognizes that
17 other parties may have different opinions, and therefore has agreed to the negotiated
18 revenue allocation identified in the Settlement.
19 Micron supports the Settlement rate design for the T-4 class, as it reflects a
20 more balanced spread of revenue collection through demand and usage charges than
21 the Company's filed proposal.
22 Further, the Settlement provides that the Company and Staff will hold one or
23 more workshops to discuss the components of the Company's class cost of service
24 study and related matters for inclusion in the Company's next rate case.
Leyko, DI (Settlement) 5
Micron Technology, Inc.

1 Q IN YOUR OPINION, IS THE SETTLEMENT REASONABLE AND IN THE PUBLIC
2 INTEREST?
3 A Yes. The settling parties compromised on their various positions to reach a Settlement
4 that economically and efficiently resolves issues that would have been contested in this
5 case. The Settlement provides the Company with the ability to update its rates to better
6 reflect current costs and a reasonable opportunity under current conditions to finance
7 new investments while maintaining just and reasonable rates for its customers.
8 Furthermore, approving the Settlement will result in administrative efficiencies for the
9 Commission, Staff, and parties, and reduced rate case expenses to the benefit of all
10 IGC customers.
11 Q DOES THIS CONCLUDE YOUR DIRECT TESTIMONY?
12 A Yes, it does.
Leyko, DI (Settlement) 6
Micron Technology, Inc.

Qualifications of James A. Leyko
1 Q PLEASE STATE YOUR NAME AND BUSINESS ADDRESS.
2 A James Leyko. My business address is 16690 Swingley Ridge Road, Suite 140,
3 Chesterfield, MO 63017.
4 Q PLEASE STATE YOUR OCCUPATION.
5 A I am a Senior Consultant in the field of public utility regulation with the firm of Brubaker
6 & Associates, Inc. ("BAI"), energy, economic and regulatory consultants.
7 Q PLEASE SUMMARIZE YOUR EDUCATIONAL BACKGROUND AND EXPERIENCE.
8 A I received a Bachelor of Arts Degree in History from Tulane University in 2007. 1
9 attended Saint Louis University and received a Master of Business Administration
10 Degree in 2011. 1 joined BAI and served in the analyst department until 2012. Prior to
11 rejoining BAI as a Consultant in 2018, 1 worked as a Regulatory Economist for the
12 Maryland Public Service Commission and as the Regulatory Affairs Manager for the
13 Efficiency Maine Trust.
14 1 have written testimony and appeared as an expert witness before the Illinois
15 Commerce Commission, the Maine Public Utilities Commission, the Maryland Public
16 Service Commission, and the Oklahoma Corporation Commission, and have supported
17 filings for several regulated utility matters as a Consultant for BAI. These assignments
18 included revenue requirement issues such as incentive compensation and vegetation
19 management, income taxes, the impact of the Tax Cuts and Jobs Act of 2017, and
20 resource planning.
21 BAI was formed in April 1995. BAI and its predecessor firm have participated
22 in more than 700 regulatory proceedings in 40 states and Canada.

1 BAI provides consulting services in the economic, technical, accounting, and
2 financial aspects of public utility rates and in the acquisition of utility and energy
3 services through RFPs and negotiations, in both regulated and unregulated markets.
4 Our clients include large industrial and institutional customers, state regulatory
5 agencies, and some utilities. We also prepare special studies and reports, forecasts,
6 surveys and siting studies, and present seminars on utility-related issues.
7 In general, we are engaged in energy and regulatory consulting, economic
8 analysis, and contract negotiation. In addition to our main office in St. Louis, the firm
9 also has branch offices in Corpus Christi, Texas; Louisville, Kentucky; and Phoenix,
10 Arizona.
551722
11

I DECLARATION OF JAMES A. LEYKO
2 I, James A. Leyko, declare under penalty of perjury under the laws of the state of
3 Idaho:
4 1. My name is James A. Leyko. I am employed by Brubaker &
5 Associates, Inc. ("BAI") a consultant in the field of public utility regulation.
6 2. On behalf of Micron Technology, Inc., I present this pre-filed
7 testimony in support of the settlement stipulation in this matter.
8 3. To the best of my knowledge, my pre-filed testimony in support of
9 the settlement stipulation is true and accurate.
10 1 hereby declare that the above statement is true to the best of my knowledge
11 and belief, and that I understand it is made for use as evidence before the Idaho
12 Public Utilities Commission and is subject to penalty for perjury.
13 SIGNED this 5th day of November 2025, at Chesterfield, Missouri.
14 Signed:%.-
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17 36183425_v1

CERTIFICATE OF SERVICE
I hereby certify that on November 5, 2025, a true and correct copy of the within and
foregoing DIRECT TESTIMONY OF JAMES A. LEYKO IN SUPPORT OF THE
STIPULATION AND SETTLEMENT was served in the manner shown to:
Intermountain Gas Company
Preston N. Carter Lori A. Blattner
Megann E. Meier Intermountain Gas Company
Givens Pursley LLP P.O. Box 7608
601 W. Bannock Street Boise, ID 83707
Boise, ID 83702 lori.blattnergint-ag s.com
prestoncarter(&, 1g venspursley.com igcre ulatory(&jnt ag s.com
mem&givenspursle.
stephaniew(&, la g venspursle.
Commission Staff Micron Technology, Inc.
Jeffrey R. Loll Austin Rueschhoff
Monica Barrios-Sanchez Thorvald A. Nelson
Idaho Public Utilities Commission Austin W. Jensen
11331 W. Chinden Blvd., Building 8, Kristine A.K. Roach
Suite 201-A Holland& Hart, LLP
Boise, ID 83714 555 17th Street, Suite 3200
jef£loll@,puc.idaho.gov Denver, CO 80202
secretM( puc.idaho.gov darueschhoff2hollandhart.com
monica.barriossanchez(kpuc.idaho.gov tnelson(ae,hollandhart.com
awj ensen(ahollandhart.com
karoach(a,hollandhart.com
acleeAhollandhart.com
tlfriel(a,hollandhart.com
Alliance of Western Energy Customers
Chad M. Stokes
Tyler R. Whitney
Cable Huston LLP
1455 SW Broadway, Suite 1500
Portland, OR 97201
cstokes&cablehuston.com
twhitney(&,cablehuston.com
brmullins(a,mwanalytics.com
s/Tracy Friel
36201092_v1