20260127APPLICATION.pdf

RECEIVED
January 27, 2026
IDAHO PUBLIC
UTILITIES COMMISSION
_ ROCKY MOUNTAIN 1407 W.North Temple,Suite 330
POWER. Salt Lake City,UT 84116
A DIVISION OF PACIFICORP
January 27, 2026
VIA ELECTRONIC DELIVERY
Commission Secretary
Idaho Public Utilities Commission
11331 W. Chinden Blvd
Building 8 Suite 201A
Boise, ID 83714
RE: CASE NO. PAC-E-26-02
IN THE MATTER OF THE APPLICATION OF ROCKY MOUNTAIN POWER FOR AN
ACCOUNTING ORDER FOR EXCESS LIABILITY INSURANCE COSTS RELATED TO
WILDFIRE
Attention: Commission Secretary
Please find Rocky Mountain Power's application in the above-referenced matter.
Informal inquiries may be directed to Mark Alder, Idaho Regulatory Manager at(801) 220-2313.
Very truly yours,
94_za-�D
Joe Steward
Senior Vice President, Regulation
Enclosures
CC: Donn English

Joe Dallas (ISB# 10330)
PacifiCorp,Assistant General Counsel
825 NE Multnomah Street, Suite 2000
Portland, OR 97232
Email:joseph.dallas(ibpacificorp.com
Attorney for Rocky Mountain Power
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF ) CASE NO. PAC-E-26-02
ROCKY MOUNTAIN POWER FOR AN )
ACCOUNTING ORDER FOR EXCESS )
LIABILITY INSURANCE COSTS RELATED ) APPLICATION
TO WILDFIRE )
PacifiCorp, d/b/a Rocky Mountain Power ("Rocky Mountain Power" or "Company")
pursuant to Idaho Code (I.C.) § 61-524 and Idaho Public Utilities Commission Rule of Procedure
052 submits this application to the Idaho Public Utilities Commission ("Commission"). Rocky
Mountain Power respectfully applies to the Commission for an accounting order authorizing the
Company to establish a balancing account. This account will track, on a monthly basis beginning
February 15, 2026: (1)the annualized revenues of approximately$8.63 million currently included
in Idaho base rates associated with excess liability insurance premium expenses related to
wildfires; and (2) 80 percent of any Idaho wildfire liability claims and/or associated outside
defense counsel expenses. The purpose of this deferral is to facilitate Rocky Mountain Power's
transition to a reserve fund for wildfire events effective February 15, 2026—the date on which its
current policies expire—and pending the Commission's future consideration of establishment of
an Idaho reserve fund.
In support of this Application, Rocky Mountain Power states as follows:
APPLICATION OF ROCKY MOUNTAIN POWER Page I

I. NAME AND ADDRESS OF THE APPLICANT
1. Rocky Mountain Power, a division of PacifiCorp, an Oregon Corporation whose
address is 1407 West North Temple, Suite 320 Salt Lake City,Utah 84116, is authorized to do and
is doing business in the state of Idaho. The Company provides retail electric service to
approximately 91,000 customers in the state and is subject to the jurisdiction of the Commission.
The Company's retail certificated service territory encompasses portions of Fremont, Madison,
Teton, Clark, Jefferson, Lemhi, Oneida, Bannock, Franklin, Caribou, Butte, Bingham, Bear Lake,
and Bonneville counties. Rocky Mountain Power is a public utility in the state pursuant to I.C.
§ 61-129.
2. Formal correspondence and requests for additional information regarding this
matter should be addressed to:
By email (preferred): datarequest(d),pacificorp.com
By regular mail: Data Request Response Center
PacifiCorp
825 NE Multnomah, Suite 2000
Portland, Oregon 97232
With copies to:
Mark Alder
Idaho Regulatory Affairs Manager
1407 W.North Temple, Suite 330
Salt Lake City, Utah 84116
Telephone: [phone]
Email: mark.alder(d),pacificorp.com
Joe Dallas
Assistant General Counsel
Rocky Mountain Power
825 NE Multnomah, Suite 2000
Portland, Oregon 97232
Email:joseph.dallas&pacificorp.com
APPLICATION OF ROCKY MOUNTAIN POWER Page 2

Informal inquiries related to this Application should be directed to Mark Alder, Idaho
Regulatory Affairs Manager, at(801) 220-2313.
II. BACKGROUND
3. In the Commission's Order approving the Stipulation and Settlement Agreement in
Rocky Mountain Power's most recent general rate case(the"2024 GRC Order"),the Commission
authorized the inclusion, in base revenue requirement, of approximately $9.8 million' of Idaho-
allocated test period excess liability insurance premium expenses. The 2024 GRC Order also
approved the creation of the Insurance Cost Adjustment("ICA")to track insurance costs exceeding
the amount set in case rates. The approved Stipulation also provided a provision to allow the
PacifiCorp Idaho Industrial Customers ("PIIC") and Idaho Irrigation Pumpers Association
("IIPA") to participate in the ongoing Wildfire Insurance Working Group ("Working Group"),
subject to execution of the applicable non-disclosure agreement.
4. As part of the Working Group, Rocky Mountain Power, Idaho Public Utility
Commission Staff("Staff'), P4 Productions, L.L.C., an affiliate of Bayer Corporation ("Bayer"),
PIIC,and IIPA(collectively"Parties")are actively working towards a joint application to establish
the creation of a reserve fund that would allow PacifiCorp to recover the costs associated with
third-party claims and outside defense costs incurred as a result of wildfires occurring in Idaho.
The reserve fund, if approved, would allow Rocky Mountain Power to avoid the expense
associated with maintaining commercial excess liability insurance for claims arising from Idaho
wildfires. While the Parties have been working diligently on creating the agreements necessary to
make the joint application filing,those agreements are complicated and have taken more time than
1 In the Matter of Rocky Mountain Power's Application for Authority to Increase Its Rates and Charges in Idaho,
Case No.PAC-E-24-04,Order No.36452($8.63 million of this amount is attributable to excess liability insurance
costs related to wildfire risk).
APPLICATION OF ROCKY MOUNTAIN POWER Page 3

anticipated to complete.
5. Rocky Mountain Power's current excess liability insurance policies covering
wildfire risks in Idaho expire at midnight on February 14,2026.The Parties agree that the proposed
reserve fund is very likely to be less costly for customers than the cost of commercial insurance.
Therefore,it is in the public interest if Rocky Mountain Power does not renew that insurance going
forward. However, since the Commission has not and will not have an opportunity to review and
approve the future application prior to February 15, 2026, Staff supports and no other party has
communicated opposition to this deferral accounting as an intermediate step. Specifically,after the
Company's existing excess liability insurance policies expire,Rocky Mountain Power proposes to
defer: (a) the portion of its revenue requirement approved by the Commission for payment of
excess liability insurance costs(which has historically been used to pay premiums for commercial
insurance policies); and (b) any prospective liabilities and outside defense costs arising from
wildfires in Idaho that ignite on or after February 15, 2026. The deferral requested herein will
allow the Commission to place customers and the Company in the same position as if the reserve
fund went into effect on February 15, 2026, if the Commission ultimately approves the reserve
fund. If the Commission does not ultimately approve the reserve fund, Rocky Mountain Power
believes the deferral requested will allow it to seek recovery of deferred costs in a future rate
proceeding, subject to any Commission directive to the contrary. But in any case,Rocky Mountain
Power will be able to avoid incurring the expense of renewing commercial insurance for excess
liability claims associated with Idaho wildfires from at least February 15, 2026 through February
14, 2027—when, if necessary, commercial insurance can be reacquired.
6. As will be detailed in the future application, the requested approval by the
Commission of the reserve fund mechanism will include a request to authorize the prospective
APPLICATION OF ROCKY MOUNTAIN POWER Page 4

transfer of revenues paid by Idaho customers to a reserve fund Trust. If the Commission approves
deferred accounting, the deferred revenues in excess of deferred costs will also be transferred into
the Trust once it takes effect. If approved, the Trust will be established to hold and invest funds
dedicated to the payment of wildfire liability claims.
III. REQUEST FOR APPROVAL OF ACCOUNTING ORDER
7. In accordance with I.C. § 61-524, Rocky Mountain Power requests approval of a
balancing account that would authorize the tracking of revenues beginning February 15, 2026, in
the amount of approximately$8.63 million annually attributable to the Company's excess liability
insurance costs related to wildfire risk from the Company's last rate case along with the tracking
of any costs incurred associated with Idaho wildfire liability claims and/or associated outside
defense counsel expenses incurred during the deferral period and associated with wildfire events
that occur on or after February 15, 2026.
8. In the 2024 GRC Order, the Commission approved an annual $9.8 million in total
excess liability cost—$8.63 million of this amount is attributable to excess liability insurance costs
related to wildfire risk. The deferral would track the revenues associated with annual$8.63 million
figure.
9. The Company expects the deferred accounting to be temporary until the earlier of
the date a mechanism for a reserve fund is approved by the Commission and implemented or new
commercial excess liability insurance can be acquired on or after February 15, 2027. This deferral
will allow the net revenues recovered from Idaho customers not otherwise used to pay for wildfire
claims and outside defense counsel costs to be, subject to Commission approval, deposited in the
Trust to build a reserve fund for prospective Idaho wildfire liabilities. The accounting order will
APPLICATION OF ROCKY MOUNTAIN POWER Page 5

ensure that the transition to the reserve fund does not result in any potential over-recovery or under-
recovery of costs.
A. Description of Utility Expense
10. The balancing account is limited to revenues in the amount of $8.63 million
annually consistent with the costs approved for recovery in the 2024 GRC Order related to the
Company's excess liability insurance policies and any Idaho wildfire liability claims and/or
associated outside defense counsel expenses that may occur during the deferral period before a
self-insurance mechanism is approved and implemented. The exact amount to be deferred within
the balancing account will depend on the length of the time between February 15, 2026 (the date
the Company's existing excess liability insurance policies expire), and the implementation date of
a future reserve fund mechanism.
11. The amount being tracked in the deferred balancing account would be transferred
and deposited into the Trust if approved by the Commission in the future.
12. In the event the Commission does not approve the Trust, the proposed deferral will
terminate on February 15, 2027, and any amounts in the balancing account will be eligible for
consideration in a subsequent rate filing.
B. Reasons for Deferral
13. When its existing excess liability insurance policies covering Idaho expire on
February 14, 2026, the Company plans to hold the revenues it receives from customers that would
have been historically used to pay insurance premiums. These amounts will not be used to pay
commercial insurance premiums; rather, they will be held in a balancing account and, pending
Commission approval, used to make the initial deposits into the Trust to support the proposed
reserve fund mechanism.
APPLICATION OF ROCKY MOUNTAIN POWER Page 6

14. A deferred accounting order will make clear that the revenues authorized to pay the
Company's insurance costs will be used for that purpose after the establishment of the reserve fund
mechanism. The deferral is necessary to account for the timing difference between the date when
the Company is no longer paying commercial insurance premiums for its Idaho excess liability
coverage related to wildfire risk, and the date the Company is authorized to transfer funds into the
Trust for reserve fund purposes if approved by the Commission.
15. The Company will be without commercial excess liability coverage for any wildfire
event(s)that occur in Idaho for the interim period beginning when the current policies expire until
either: (1) the Commission approves the proposed reserve fund mechanism; or (2) the Company
is otherwise able to procure commercial coverage if the reserve fund mechanism is denied. The
deferral would track 80 percent of the cost of claims and outside defense costs related to wildfires
that occur in Idaho during the interim period. The Company has agreed to pay (and not seek
recovery from customers for purposes of the deferral requested in this Application) a 20 percent
share of claims and outside defense costs in the proposed reserve fund mechanism.
16. The Company acknowledges that the Commission's approval of deferred
accounting treatment does not constitute a prudence determination or approval for any costs and
revenues. Prudence review would occur in the future application proceeding and/or in a future rate
proceeding.
C. Proposed Accounting
17. The Company requests to record the deferral in Account 254 (Other Regulatory
Liabilities). The Company estimates that approximately $0.72 million of revenues per month may
be deferred, beginning on February 15, 2026, and ending on the earlier of the effective date of the
Commission approving a future wildfire reserve fund mechanism or February 15, 2027. The
Company is unable to estimate any Idaho wildfire liability claims and/or associated outside defense
APPLICATION OF ROCKY MOUNTAIN POWER Page 7

counsel expenses that may be deferred during this period. This account will accrue interest at the
Commission-authorized rate for deferred accounts.
IV. REQUEST FOR MODIFIED PROCEDURE
18. Rocky Mountain Power believes that a hearing is not necessary to consider the
issues presented herein and respectfully requests that this Application be processed under Modified
Procedure, i.e., by written submissions rather than by hearing, in accordance with Idaho Public
Utilities Commission Rules of Procedure 201 —204.
V. CONCLUSION
WHEREFORE, Rocky Mountain Power respectfully requests an order authorizing the
establishment of a balancing account for: (1) $8.63 million in annualized revenues that the
Commission approved as part of the Company's revenue requirement in the last rate case
associated with excess liability insurance costs related to wildfires; and(2) 80 percent of any Idaho
wildfire liability claims and/or associated outside defense counsel expenses associated with
wildfires that ignite on or after February 15, 2026, from February 15, 2026 until the earlier of the
effective date of the implementation of a future wildfire reserve fund mechanism or February 15,
2027. The Settling Parties support this deferral request and are in the process of developing and
negotiating the future application that will be filed for Commission consideration in the near future.
Rocky Mountain Power requests that the Commission approve this Application on or
before February 15, 2026.
APPLICATION OF ROCKY MOUNTAIN POWER Page 8

Respectfully submitted this 27th day of January 2026.
Joe Dallas (ISB# 10330)
PacifiCorp,Assistant General Counsel
825 NE Multnomah Street, Suite 2000
Portland, OR 97232
Email:joseph.dallaskpacificorp.com
Attorney for Rocky Mountain Power
APPLICATION OF ROCKY MOUNTAIN POWER Page 9