20251231Final_Order_No_36894.pdf

Office of the Secretary
Service Date
December 31,2025
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION ) CASE NO. IPC-E-25-22
OF IDAHO POWER COMPANY FOR )
AUTHORITY TO UPDATE ITS OPERATION ) ORDER NO. 36894
AND MAINTENANCE CHARGES )
APPLICABLE TO SCHEDULE 72, )
GENERATOR INTERCONNECTIONS TO )
PURPA QUALIFYING FACILITY SELLERS )
On May 8,2025,Idaho Power Company("Company"),applied to the Idaho Public Utilities
Commission ("Commission") requesting authority to update its operation and maintenance
("O&M") charges applicable to Schedule 72, generator interconnections to Public Utility
Regulatory Policies Act ("PURPA") qualifying facility QF sellers effective January 1, 2026
("Application"). The Company requests that the Application be processed under modified
procedure. Application at 5.
On June 9,2025,the Commission issued a Notice of Application and Notice of Intervention
Deadline. Order No. 36631. The Commission granted intervention to Idaho Hydroelectric Power
Producers Trust, an Idaho Trust, d/b/a IdaHydro ("IdaHydro") and the Renewable Energy
Coalition ("REC") (collectively, "Intervenors"). Order Nos. 36629 and 36668. Within its petition
to intervene, IdaHydro objected to the Company's request for modified procedure and requested a
technical hearing. IdaHydro's Petition to Intervene at 2.
After hearing arguments concerning IdaHydro's request for a technical hearing at its
August 5, 2025, Decision Meeting, the Commission issued a Notice of Modified Procedure that
set a public comment deadline,an all-party response deadline, and a final Company reply deadline.
Order No. 36714. The Commission did not preclude the parties from making further requests for
a technical hearing. Commission Staff("Staff') and the Intervenors filed comments on September
16, 2025. On October 14, 2025, the Company filed reply comments.
In its comments, IdaHydro requested that this matter be set for full evidentiary hearing if
the Commission is unwilling to provide the relief sought by IdaHydro based on written
submissions. Memorandum in Support of Comments for IdaHydro at 7. Subsequently, on October
14, 2025, IdaHydro filed a Renewed Request for Hearing and Request for Additional Time to
Conduct Discovery ("Renewed Request").
ORDER NO. 36894 1

The Commission heard arguments concerning IdaHydro's Renewed Request at its October
28, 2025, Decision Meeting and found no compelling argument as to why the record cannot be
fully developed through written submissions. However,the Commission also found good cause to
grant additional time for the parties to conduct discovery and to allow for supplemental and new
comments. Accordingly, the Commission issued an Amended Notice of Modified Procedure,
establishing deadlines for an additional round of comments. Order No. 36833. Staff and IdaHydro
filed supplemental comments to which the Company replied.
On December 24, 2025, IdaHydro filed a Motion for Oral Argument, requesting the
Commission schedule oral arguments regarding certain issues IdaHydro contended were
overlooked in written submissions filed under modified procedure. On December 30, 2025, the
Company filed an Objection and Answer to IdaHydro's motion.
Based on our review of the record, we now issue this Order denying IdaHydro's Motion
for Oral Argument and approving the Company's Application with the modifications described
herein.
BACKGROUND
The Company received authority from the Commission to implement Schedule 72 in April
of 1991. Order No. 23631. Previously, the Company had individually negotiated the terms and
conditions for the interconnection of non-utility generation to the Company's transmission and
distribution system. Id. at 1. When the Company applied to the Commission for authority to
implement Schedule 72, it contended that such interconnections should be addressed on a single
schedule, ensuring uniform treatment of the generator interconnections.Id.
Following its approval of Schedule 72, the Commission granted a petition for
reconsideration of Order No. 23631 as to two issues raised by the petitioner. Order No. 24025 at
1.Firstly,the Commission considered the inclusion of interconnection costs in the administratively
determined avoided cost rate. Id. Secondly, the Commission examined the calculation and
reasonableness of Schedule 72's O&M service charge. Id. The Commission determined the
Schedule 72 O&M to be appropriate because interconnection costs were included in the
administratively determined avoided cost rate, and the underlying system averages methodology
used to calculate the O&M charges was reasonable. Order No. 24025 at 2, 4.
ORDER NO. 36894 2

THE APPLICATION
The Company represented that when a QF seller interconnects to the Company's system,
the QF is responsible for the capital costs of the facilities necessary to connect to the Company's
system. Application at 2. Following interconnection, ownership of the facilities prior to the QF
interconnection point is transferred to the Company, which assumes responsibility for continuing
O&M costs. Id. According to the Company, the Schedule 72 O&M service charge is based on
system averages associated with the O&M of interconnection facilities and is intended to
compensate the Company to ensure O&M costs caused by a QF interconnection are not passed to
the general body of Company customers.Id.
The Company stated that Commission Order No. 36042, approving the settlement
stipulation regarding the Company's 2023 General Rate Case ("2023 GRC"), required the
Company to work with IdaHydro, which was an intervenor in the 2023 GRC and signatory to the
settlement stipulation, to update the monthly O&M charge in Schedule 72 to reflect current
operating metrics and assumptions. Application at 2-3. The Company stated that since the
conclusion of the 2023 GRC, it has held informal discussions with and provided documentation to
IdaHydro regarding the methodology used to determine O&M charges applicable to Schedule 72.
Id. at 3.
According to the Company, the Schedule 72 O&M rates that are currently in effect were
subjected to a "de-levelization" process, wherein the rate was lower early in the life of the
interconnection equipment and escalated for 35 years using an inflation factor. Id. at 4. The
Company proposed an updated Schedule 72 O&M charge calculation in which rates are
"levelized." Id. The Company sought to implement the updated O&M charges utilizing the
levelized, average rates to collect O&M going forward.Id. The Company proposed to remove the
de-levelization concept from the rate and instead charge the same calculated average rate each
year. Id. The Company also proposed to update Schedule 72's O&M charge, along with the
associated revenue credit, on a more frequent basis in conjunction with each general rate case
proceeding. Id.
The Company stated that it calculated its proposed O&M charges based on 13-month
average plant balances and such plant's associated O&M expenses, resulting in a proposed
monthly 0.90 percent rate applied to the original cost of distribution interconnection equipment
(up from 0.70 percent per month from the existing O&M charge) and a 0.26 percent rate applied
ORDER NO. 36894 3

to the original cost of transmission interconnection equipment(down from 0.40 percent per month
from the existing O&M charge). Id.; Errata and Corrected Pages to Application and Direct
Testimony of Riley Maloney at 2.
INITIAL COMMENTS
A. Staffs Initial Comments
After reviewing the Company's Application and accompanying materials and conducting
written discovery concerning the Company's position, Staff filed its initial comments. Staff s
analysis focused on the proposed Schedule 72's: (1) satisfaction of the requirements contained in
the settlement stipulation approved in Order No. 36042; (2) distinction between transmission
voltages; (3) methodology for calculating O&M charges; and (4) removal of the de-levelization
process. Staff Comments at 2.
Staff believed that the Company's Schedule 72 proposal satisfied the requirements of Order
No. 36042.Id. at 2. Staff noted that the Company modified the original O&M charge methodology
to reflect current assumptions, as directed, to arrive at its proposal. Id. at 2-3. According to Staff,
the Company calculated the proposed rates by dividing O&M expenses by plant investments,
consistent with the currently authorized methodology.Id. at 3. Among the modifications noted by
Staff, the Company excluded property taxes from the calculation to account for the Idaho State
Tax Commission's discontinuation of assessing property taxes on"contributed property."Id. The
Company also excluded expenses in Federal Energy Regulatory Commission ("FERC") Account
565 (Transmission of Electricity by Others) from calculations for the proposed O&M charges,
because such expenses are not costs associated with generator interconnections. Id. Finally, the
Company changed its recording of payroll taxes so that the taxes are allocated to the O&M
accounts that include the associated labor expenses. Id. Staff believed each of the modifications
were reasonable.Id.
According to Staff,transmission O&M charges currently apply only to 138-kilovolt("kV")
and 161 kV lines, and distribution O&M charges apply to lines below 138 W.Id. Staff noted that
QFs can be interconnected to the Company's system at transmission voltages other than 138 kV
and 161 W. Id. at 4. Staff believed Schedule 72 should be modified to capture the range of
transmission voltages.Id.
Staff also stated that the Company calculated the current transmission O&M charges using
transmission-categorized costs in various FERC accounts from the Company's Transmission Sub-
ORDER NO. 36894 4

Functionalization report. Id. Because the Company stopped producing the report years ago, it
proposed using costs associated with the 138 kV and 161 kV lines to replace the transmission-
categorized costs from the Transmission Sub-Functionalization report.Id. Staff,however,believed
both the transmission O&M charges and distribution O&M charges should be calculated based on
O&M costs and plant investments of interconnection facilities at specific voltage levels. Id. Staff
also recommended a weighting mechanism for calculating O&M charges designed to factor QF
interconnection capacity at each voltage level. Id. at 4-5.
Staff supported the Company's proposed removal of the de-levelization process. Id. at 5.
Staff believed this approach was more straightforward and reduced the risk of the Company under-
recovering O&M costs shorter than the maximum PURPA contract length. Id.
Ultimately, Staff recommended the Commission require the Company to submit a
compliance filing that: (1) modifies Schedule 72 so that the transmission O&M charge applies to
transmission lines of 138 kV and above; (2) uses the voltage-based calculation for both the
transmission and distribution O&M charges; (3)uses all levels of transmission voltages of 138 kV
and above to develop the transmission O&M charges and use all levels of distribution voltages
below 138 kV to develop the distribution O&M charge; (4) determines the transmission and
distribution O&M charges using the weighted average of the respective O&M rate at each voltage
level, weighted by the QF interconnection capacity percentage at each level as of December 31,
2024.
B. IdaHydro's Initial Comments
Rather than opposing the specific inputs and modifications the Company sought to
implement regarding calculation of its Schedule 72 O&M charges, IdaHydro more broadly
objected to the approved methodology. IdaHydro characterized the system average framework for
determining Schedule 72 O&M charges as "phantom costs based on averages." Memorandum in
Support of Comments for IdaHydro at 3. IdaHydro believed the Company does not track actual
O&M costs and instead sweeps each QF into general plant accounts.Id. at 4. IdaHydro argued that
without tracking actual costs there can be no verification of whether the assessed O&M charges
bear any resemblance to actual incremental costs in excess of baseline utility expenditures. Id. at
5. IdaHydro contended the typical four-pole interconnection used for many small hydro facilities
cost far less to operate and maintain than the Company's wider transmission and distribution
network and usually last for 20-30 years while requiring little maintenance.Id. at 5-6; Comments
ORDER NO. 36894 5

of Ted Sorenson for IdaHydro at 2. According to IdaHydro, under the system average
methodology, QFs with low-cost interconnections are forced to subsidize the Company's larger
system expenses. Memorandum in Support of Comments for IdaHydro at 6.
Much of IdaHydro's initial comment submission focused on its understanding—arising
from the Company's response to a discovery request that was later modified by supplementation
that the Company's proposal (and the currently used methodology) did not include factoring
avoided interconnection costs into the Schedule 72 O&M charges. Id. at 1, 3. IdaHydro argued
that by failing to account for avoided O&M costs, the Company was violating federal regulation,
which defines "interconnection costs" as those "in excess of the corresponding costs which the
electric utility would have incurred if it had not engaged in interconnected operations..."Id. at 3
(quoting 18 C.F.R. § 292.101(b)(7)).
IdaHydro requested the Commission: (1) reject the Company's proposal regarding
Schedule 72 O&M charges; (2)require future Schedule 72 charges be based on actual incremental
O&M costs in excess of what the Company would pay for O&M costs on interconnection from a
third party; (3) explicitly order the Company to subtract avoided interconnection costs from its
Schedule 72 O&M charges; and (4) forbid the Company from using system-wide averages as a
substitute for actual cost data.Id. at 7.
C. REC's Comments
REC filed comments stating it was not taking a position as to the Company's proposed
Schedule 72 O&M charge calculation revisions. REC Comments at 1-2. REC instead focused its
comments on advancing the position that the Commission should ensure avoided O&M costs are
factored into the Company's PURPA pricing. Id. at 2. Like IdaHydro, REC quoted 18 C.F.R. §
292.101(b)(7),and emphasized that interconnection costs are defined as those costs directly related
to the installation and maintenance of physical facilities necessary for the QF's interconnection,to
the extent such costs exceed those that the utility would have incurred generating or acquiring an
equivalent amount of energy or capacity from alternative sources. Id. at 3.
D. Company's Initial Reply Comments
The Company stated that it was not opposed in principle to the recommendations expressed
in Staff s initial comments, however, the Company represented that it does not currently have
"sufficiently granular accounting data" that would allow it to implement each of Staff s
recommendations without modification. Company Initial Reply Comments at 5. For instance, the
ORDER NO. 36894 6

Company stated that it does not track voltage-based data for all line investments below 138 kV,
and that it is therefore unable to use a voltage-based methodology for both transmission and
distribution O&M charges.Id. at 6. The Company indicated its willingness to "work with Staff to
develop a hybrid methodology that applies the voltage-based weighted average approach for
interconnections at 46 kV and above, while continuing to use the existing, previously approved
methodology for interconnection voltages below 46 kV, in determination of the distribution O&M
charge."Id. at 7.
However, the Company represented it does have sufficient data to implement Staff s
recommendations to rely on all transmission line plant investment of 138 kV and above and to
apply the proposed voltage-based weighted average methodology for the Schedule 72 transmission
O&M charge. Id. at 6-7.
The Company challenged IdaHydro's contention regarding the relative simplicity and lack
of maintenance activities required for the typical four-pole interconnection used for many small
hydro facilities.Id. at 8. According to the Company, due to its obligation to maintain its system in
accordance with applicable standards, interconnection facilities require routine inspection,testing,
and repair. Id. The Company represented that even passive infrastructure requires perpetual
attention, creating recurring costs, to remain compliant and functional. Id. The Company argued
that it appropriately recovers these costs through system average Schedule 72 O&M charges. Id.
The Company emphasized that it was seeking only to update the inputs to previously
approved methodology. Id. at 9. According to the Company, the Commission specifically
considered the issues raised by IdaHydro when it approved Schedule 72 in Case No. IPC-E-90-20.
Id. at 10. On reconsideration in that case,the Commission specifically considered two issues: "(1)
The inclusion of interconnection costs in the administratively determined avoided cost rate; and
(2) The calculation and reasonableness of the Schedule 72 operation and maintenance service
charges." Id. at 10-11 (quoting Order No. 24025 at 1, 2, 4). According to the Company, the
Commission found that the administratively determined avoided cost rate included reasonable
interconnection costs and that the underlying O&M charge methodology was reasonable.Id. at 11.
The Company maintained that QFs are compensated for avoided interconnection costs through the
avoided cost rate under both the Surrogate Avoided Resource ("SAR") and Integrated Resource
Plan ("ICIRP") methodologies. Id. at 11-13. The Company also argued that the system average
approach to O&M charges are intended to promote administrative efficiency, fair treatment among
ORDER NO. 36894 7

projects, and consistency with Commission precedent. Id. at 14. The Company represented that
"the system average O&M cost basis is exactly what is included in retail customers' rates."Id. at
14.
In addition to requesting the Commission to approve its Application, the Company
requested the Commission find that the Company has satisfied its compliance obligation from the
2023 GRC to update the Schedule 72 O&M charges to reflect current operating metrics and
assumptions. Id. at 17-18. The Company also requested that, if the Commission adopted Staff s
recommendations, the Commission provide the Company with 60 days from the order date to
submit a compliance filing for the Commission's review. Id. at 17.
SUPPLEMENTAL COMMENTS
A. Staff s Supplemental Comments
Staff filed supplemental comments reiterating its support for the system average framework
for determining Schedule 72 O&M charges. Staff Supplemental Comments at 2. Staff maintained
its recommendation regarding transmission O&M rates. Id. However, Staff recommended using
the currently approved methodology for updating the distribution O&M rates "so that both the
transmission O&M rates and the distribution O&M rates can be updated immediately." Id. Staff
also recommended the Commission order the Company to meet with Staff and other interested
parties to explore the possibility of implementing a fully voltage-based methodology for
calculating the distribution O&M rate in the future. Id.
If the Commission decides to explore alternatives to the system average framework for
determining Schedule 72 O&M charges, Staff recommended that it open a new docket for that
purpose. Id. Staff stated that any alternative considered, such as an approach based on direct-
assigned actual O&M costs, should include recovery of continuing overhead costs associated with
interconnection O&M. Id. Staff believed there are overhead costs related to interconnection that
cannot be directly assigned, such as sufficient inventory of replacement parts and staffing needed
to maintain the Company's transmission and distribution system.Id. at 3.
B. IdaHydro's Supplemental Comments
After conducting additional discovery, IdaHydro filed supplemental comments. IdaHydro
represented that the Company confirmed it does not track actual interconnection O&M costs and
that it cannot determine what interconnection O&M it embedded in avoided cost payments.
Supplemental Comments of IdaHydro at 2.According to IdaHydro,in the absence of these figures,
ORDER NO. 36894 8

the Company is unable to comply with the PURPA requirement that any Schedule 72 charge
represent incremental costs in excess of what the utility would have spent without the
interconnection because any such determination is impossible. Id.
IdaHydro noted that after initially stating that interconnection O&M was not included in
the avoided cost calculation, the Company now takes the position that QFs receive avoided
interconnection O&M through the SAR and ICIRP proxy-resource methodologies. Id. at 3.
IdaHydro represents that the Company's witnesses testified at deposition that the avoided cost
model used by the Commission does not allow for the isolation of interconnection O&M. Id.
Rather, according to IdaHydro, the witnesses testified that the avoided cost framework includes
only broad categories of fixed and variable O&M for proxy gas generators and no breakout for
interconnection facilities. Id. IdaHydro stated that the witnesses were unable to identify any
avoided O&M attributable to PURPA interconnections within the rates. Id.
Additionally, IdaHydro argued that QFs are demonstrably overcharged under the current
Schedule 72 methodology.Id. at 9. According to IdaHydro, data provided by the Company during
the 2023 GRC indicated the Company recovered an aggregate amount of O&M charges that
exceeded the original construction costs of the interconnection over several years. Id. IdaHydro
contends there is no reasonable cost-causation theory that would justify the Company recovering
enough O&M to replace the asset multiple times during its useful life. Id. at 10.
IdaHydro requested the Commission: (1) disapprove the current Schedule 72 proportional
O&M methodology as inconsistent with PURPA's excess-cost standard; (2) direct the Company
to track actual interconnection O&M on a facility-specific basis, which IdaHydro represented is
consistent with the FERC Uniform System of Accounts; (3) direct the Company to identify and
quantify interconnection O&M embedded in its avoided cost rate; (4)direct the Company to justify
all Schedule 72 O&M charges as "excess," as defined in 18 C.F.R. § 292.101(b)(7); (5) require
the Company to charge QFs the actual interconnection O&M costs that can be justified by discrete
billing and invoicing.Id. at 12.
C. Company's Supplemental Reply Comments
The Company reiterated its position that the previously approved Schedule 72 O&M
charge methodology is consistent with PURPA regulations and results in fair,just, and reasonable
allocation of incremental additional costs to the Company created by QF interconnection.
Company Supplemental Reply Comments at 4. According to the Company, under PURPA's
ORDER NO. 36894 9

mandatory purchase obligation, a utility's retail customers must be unaffected by a QF's
interconnection. Id. The Company argued that the system average approach to Schedule 72 O&M
charges is designed to match the impact imposed on its customers. Id. at 5. The Company
contended IdaHydro's proposed Schedule 72 O&M methodology fails to account for the entirety
of O&M needed for the system and would thus fail to protect retail customers from incurring costs
associated with the interconnection of QFs. Id. at 14. The Company also represented that a
requirement to track QF-specific costs would create an undue administrative burden,requiring the
Company to establish a separate system of work orders and billing for QFs. Id. at 10-11.
Rather than maintain its previous recommendation that the Company collaborate with Staff
to develop a hybrid methodology for determining O&M charges applicable to interconnections
less than 138 W, the Company recommended the Commission require the Company to meet with
Staff and other interested parties to discuss implementing a fully voltage-based methodology for
determining future distribution O&M rates. Id. at 15, 16.
IDAHYDRO'S MOTION FOR ORAL ARGUMENT
IdaHydro filed a Motion for Oral Argument on December 24, 2025. IdaHydro contended
certain issues were not sufficiently addressed in written comments under modified procedure.
IdaHydro's Motion for Oral Argument at 1. Specifically, IdaHydro requested oral arguments
concerning its positions that(1)the Company bears the burden of proof in charging expenses; and
(2)FERC's definition of interconnection costs as those in excess of what the Company would have
otherwise incurred. Id. The Company's motion included support for its positions regarding the
specified issues, including a recap of witness testimony from Case No. IPC-E-90-20.Id. at 1-4.
The Company filed an Objection and Answer to IdaHydro's motion on December 30,2025.
The Company asserted that IdaHydro has had sufficient opportunity to examine the Company's
positions related to this case through its use of depositions and written discovery and that setting
oral arguments would not contribute meaningfully to a resolution of the case. Company's
Objection and Answer at 3. Additionally, the Company argued that the motion was untimely and
that the late submission does not justify delay of the requested January 1, 2026, effective date.
COMMISSION FINDINGS AND DECISION
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 §§ 61-301 through 303. The
Commission is empowered to investigate rates, charges,rules,regulations,practices, and contracts
ORDER NO. 36894 10

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 through 503. The Commission has reviewed the Application, all other submitted
materials, including IdaHydro's Motion for Oral Argument. Based on our review of the record,
the Commission denies IdaHydro's Motion for Oral Argument and finds it fair, just, and
reasonable to approve the Company's Application, with modifications.
A. IdaHydro's Motion for Oral Argument
Under the Commission's Rules of Procedure, it "may set and hear oral argument on any
matter before it on reasonable notice." IDAPA 31.01.01.254. The Commission may decide
motions either with or without oral argument or hearing. IDAPA 31.01.01.256. If the Commission
denies a moving party's request for oral argument, it must state the grounds for the denial.Id. The
Commission will not act on a motion on fewer than 14 days' notice unless the movant complies
with the requirements for requesting Commission action on shorter notice. IDAPA
31.01.01.256.02-03.
We find IdaHydro's Motion for Oral Argument was late-filed. While IdaHydro did not
specify a date by which it requested the Commission act upon the motion, the Company's
requested January 1, 2026, effective date meant that the Commission either had to rule on the
motion on an expedited basis or suspend the effective date.1 IdaHydro did not follow the
requirements for requesting Commission action on fewer than 14 days' notice.
We also find that the relief sought by IdaHydro is unnecessary. IdaHydro alleged that the
Company did not address the burden of proof required for charging expenses or FERC's definition
of interconnection costs. IdaHydro's Motion for Oral Argument at 1. However, the Company's
written submissions repeatedly set forth the Company's position that its Schedule 72 O&M charges
are reasonably and lawfully calculated and that avoided cost rates paid to QFs include
compensation for avoided interconnection costs.E.g. Company Initial Reply Comments at 11, 13;
Company Supplemental Reply Comments at 8-13. The Commission understands both IdaHydro's
and the Company's arguments and does not require oral arguments from the parties to render an
informed decision.
1 Under the Commission's Rules of Procedure,if the Commission did not approve the Company's proposed
changes or suspend its requested effective date, the changes would have automatically gone into effect on
January 1, 2026. See IDAPA 31.01.01.123.01.
ORDER NO. 36894 11

B. The Company's Application
With regard to the opposition to the Company's proposed Schedule 72 changes, we find
that this docket—which was opened for the purpose of updating the inputs used to calculate the
O&M charges—is not the appropriate forum for a full-scale challenge to the previously approved
methodology. Should IdaHydro or any other party desire a full re-examination of the system
average methodology, they may petition the Commission to open a docket for that purpose.
Potential replacements to the system average framework for determining Schedule 72 O&M
charges, such as an approach based on direct-assigned actual O&M costs, should be thoroughly
reviewed with possible implications considered prior to implementation. For the purpose of this
docket, the Commission finds system average methodology to be a fair, just, and reasonable
approach to calculating O&M charges.
The Company shall use the voltage-based methodology to calculate Schedule 72
transmission O&M rates. The Commission directs the Company to modify Schedule 72 so that the
transmission O&M charge applies to transmission lines of 138 kV and above; use all levels of
transmission voltage of 138 kV and above to develop the Schedule 72 transmission O&M rates;
and calculate Schedule 72 transmission O&M rates based on the weighted average of the
transmission O&M rate at each transmission voltage level, weighted by the QF interconnection
capacity percentage at each voltage level as of December 31, 2024.
The Commission believes the Company should endeavor to implement a full-voltage based
methodology for both the transmission and distribution O&M rates. However, based on the
Company's representation that it does not currently collect data sufficient to implement such
methodology for the calculation of the distribution O&M charge,the Company is permitted to use
the currently approved methodology for updating the Schedule 72 distribution O&M rates. We
direct the Company to meet with Staff and other interested parties to explore the possibility of
implementing a fully voltage-based methodology for calculating the distribution O&M rate in the
future.
We approve of the Company's proposals to exclude property taxes and expenses in FERC
Account 165 from calculations for the proposed O&M charges; change its recording of payroll
taxes so that the taxes are allocated to the O&M accounts that include the associated labor
expenses; and to update Schedule 72's O&M charge, along with the associated revenue credit, in
conjunction with each general rate case proceeding. We find that the Company has satisfied its
ORDER NO. 36894 12

compliance obligation from the 2023 GRC to update the Schedule 72 O&M charges to reflect
current operating metrics and assumptions.
ORDER
IT IS HEREBY ORDERED that IdaHydro's Motion for Oral Argument is denied.
IT IS FURTHER ORDERED that the proposed monthly Schedule 72 O&M rates from the
Application(as amended by the Company's Errata and Corrected Pages to Application and Direct
Testimony of Riley Maloney) are approved, effective January 1, 2026.
IT IS FURTHER ORDERED that the Company shall modify Schedule 72 so that the
transmission O&M charge applies to transmission lines of 138 kV and above.
IT IS FURTHER ORDERED that the Company shall use the voltage-based methodology
to calculate Schedule 72 transmission O&M rates.
IT IS FURTHER ORDERED that the Company shall use all levels of transmission voltage
of 138 kV and above to develop the Schedule 72 transmission O&M rates.
IT IS FURTHER ORDERED that the Company shall calculate Schedule 72 transmission
O&M rates based the weighted average of the transmission O&M rate at each transmission voltage
level, weighted by the QF interconnection capacity percentage at each voltage level as of
December 31, 2024.
IT IS FURTHER ORDERED that the Company shall use the currently approved
methodology for updating Schedule 72 distribution rates effective January 1, 2026.
IT IS FURTHER ORDERED that the Company shall meet with Staff and other interested
parties to explore the possibility of implementing a fully voltage-based methodology for
calculating the distribution O&M rate in the future.
IT IS FURTHER ORDERED that within sixty (60) days of the issuance of this Order, the
Company shall submit a compliance filing reflecting all modifications described in this Order.
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. Idaho Code §§ 61-626.
N
ORDER NO. 36894 13

DONE by order of the Idaho Public Utilities Commission at Boise, Idaho this 3 1" day of
December 2025.
YRD
je-
DDGE, RE ZIN T
HN R. HAMMOND JR., COMMISSIONER
NX—Y—NHARDI , COM KiISSIONER
ATTEST:
?4UZ A
L a Calderon Robles
Interim Commission Secretary
I:\Legal\ELECTRICUPC-E-25-22_Gen I0ordersUPCE2522_FOjl.docx
ORDER NO. 36894 14