20150812AVU to Staff 72.docx

AVISTA CORPORATION
RESPONSE TO REQUEST FOR INFORMATIONJURISDICTION:IDAHODATE PREPARED:08/05/2015CASE NO.:AVU-E-15-05/AVU-G-15-01WITNESS:Don KopczynskiREQUESTER:IPUCRESPONDER:Heidi EvansTYPE:Production RequestDEPARTMENT:EnvironmentalREQUEST NO.:Staff- 072TELEPHONE:[phone]REQUEST:
Please explain how current and proposed expense and capital investment compare to the estimated relicensing costs when the relicense was originally approved.RESPONSE:
The Clark Fork Project License was issued by the Federal Energy Regulatory Commission in February, 2000.  The Protection, Mitigation, and Enhancement measures included in the license were based on a multi-party settlement agreement with state and federal agencies, native american tribes, and non-governmental parties in Idaho and Montana.  While some of the measures of the license require specific funding commitments, these requirements did not define specific projects, but established a planning and implementation process that Avista and stakeholders have followed for the past 15 years, and which applies to the next 30 years of the License. 
At the outset of the license, we expected costs of approximately $4.7 million per year (capital and expense) for Implementation of the Protection, Mitigation and Enhancement measure.  However, several major issues (Fish Passage and Total Dissolved Gas Abatement) were unresolved at this time. The costs of these have become clearer as we continued negotiating their resolution in recent years.  Each year, specific projects are proposed, evaluated and either approved or denied through a collaborative process that includes the agencies, tribes and other parties of the settlement agreement.  As a result, each year, the overall budget, and the mix of capital and expense investments vary. Through this process, the Company has been able to estimate the expected expense and capital costs for specific projects as well as license compliance overall.