20260512Staff Comments.pdf

RECEIVED
May 12, 2026
KELSEA E. ROSS IDAHO PUBLIC
DEPUTY ATTORNEY GENERAL UTILITIES COMMISSION
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83702
[phone]
IDAHO STATE BAR NO. 12050
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER IDAHO POWER )
COMPANY'S APPLICATION FOR ) CASE NO. IPC-E-26-06
AUTHORITY TO IMPLEMENT FIXED COST )
ADJUSTMENT ("FCA") RATES FOR )
ELECTRIC SERVICE FROM JUNE 1, 2026 ) COMMENTS OF THE
THROUGH MAY 31, 2027 ) COMMISSION STAFF
COMMISSION STAFF ("STAFF") OF the Idaho Public Utilities Commission
("Commission"),by and through its attorney of record,Kelsea E. Ross, Deputy Attorney General,
submits the following comments.
BACKGROUND
On March 13, 2026, Idaho Power Company ("Company") applied to the Commission
requesting: (1) authorization to implement Fixed Cost Adjustment ("FCA") rates for the
Residential classes and Small General Service classes, for electric service from June 1, 2026,
through May 31, 2027; and(2)approval of the Company's corresponding Schedule 54,Fixed Cost
Adjustment. The Company requested its Application be processed through modified procedure
with an effective date of June 1, 2026.
The FCA is a rate adjustment mechanism designed to break the link between the energy a
utility sells and the revenue it collects to recover fixed costs of providing service,1 thus removing
the disincentive to promote cost-effective energy efficiency by ensuring the Company can recover
1 "Fixed costs"are a utility's cost to provide service, such as infrastructure and customer service,which do not vary
with energy use, output,or production,and remain relatively stable between rate cases.
STAFF COMMENTS 1 MAY 12, 2026

its fixed costs due to lost sales. It applies to Residential and Small General Service ("R&SGS")
customers.
The Company represents that it under collected fixed costs it is authorized to recover in the
amount of$2,026,190.18 ("2025 FCA Deferral Balance").2 Id. at 5-7. The Company represents
it intends to collect the 2025 FCA Deferral Balance by increasing the FCA rates for the R&SGS
classes in 2026 and 2027. Id. at 7. The Company represents that the proposed 2026-2027 FCA
rates will increase annual billed revenue by $5,117,270, or 0.65 percent, for the R&SGS classes.
Id.
The Company represents that the 2026-2027 FCA rates will be a charge of 0.0330 cents
per kilowatt-hours ("kWh") for the Residential classes, and 0.0402 cents per kWh for the Small
General Service classes. Id. The Company represents if the 2026-2027 FCA rates are approved,
a residential customer who uses 900 kWh per month will see an increase of$0.75 on their monthly
bill. Id. at 1-2.
STAFF ANALYSIS
Staff reviewed the Company's Application and its calculations of its R&SGS FCA rates,
along with the Company's workpapers and supporting testimony provided by Company witness
Connor Allen. Based on its review, Staff recommends the Commission approve the Company's
proposed Schedule 54 as filed and accept the FCA deferral balance of$2,026,190. This balance
is composed of$2,125,276 for the Residential class and ($99,086) for the Small General Service
class. This is a 0.65%increase in rates,resulting in a monthly bill increase of$0.75 for the average
customer.
Staff audited the components used to calculate the FCA balance and believes that they
comply with Commission Orders and were calculated accurately by the Company. Staff verified
that the Fixed Cost per Customer ("FCC") and Fixed Cost per Energy ("FCE") were updated
consistent with Order No. 36042 in Case No. IPC-E-23-11. Staff also verified that the use per
customer for new and existing customers for the two affected classes was calculated correctly
using the appropriate annual kWh sales and customer counts. These inputs are based on actual
2 Application,page 7,originally states$2,025,793;this amount is revised to$2,026,190 in the Company's Errata
filed April 16,2026.
STAFF COMMENTS 2 MAY 12, 2026

billed sales and average annual customer counts derived from monthly data, consistent with Case
No. IPC-E-23-11.
Impact of Company-Sponsored Energy Efficiency
The Commission adopted the FCA in part to remove the Company's disincentive to invest
in energy efficiency that reduces energy sales. However,the Company's energy sales may decrease
for several reasons including, but not limited to, weather, economic cycles, better building codes
and standards, improved appliance standards, fuel switching (e.g., increased electric to gas
conversions), energy efficiency programs, or various consumer responses to higher electric bills
(i.e., elasticity measures). The FCA rate adjustment mechanism provides for fixed cost recovery
regardless of the cause of decreased energy sales and revenues.
Since the implementation of the FCA,the Company has stated that the mechanism reduces
its financial disincentive to promote energy efficiency programs, such as Demand Side
Management ("DSM"). See Case No. IPC-E-04-15. Cost-effective DSM programs can defer or
eliminate capital costs needed by the Company to serve load. The Company continues to
effectively achieve these benefits through its DSM programs, reporting 153,099 megawatt-hours
of system-wide energy savings. Application at 2. These energy savings are enough to power
approximately 14,000 average homes a year in the Company's service area. Id. The energy
savings are described in the 2025 DSM Annual Report filed in Case No. IPC-E-26-05.
Modifications to the FCA
In Order No. 35273, Case No. IPC-E-21-39, the Commission authorized the Company to
modify the FCA mechanism and institute separate and reduced fixed cost tracking for R&SGS
customers added to the Company's system after a specific date. In Order No. 35273, the
Commission established January 1, 2022, as the date that would separate new and existing
customers. In Order No. 36042, Case No. IPC-E-23-07, the Commission revised this date to
January 1, 2024.
The FCA modification works identically for both the R&SGS classes. Pursuant to the
modification approved in Order No. 35273, the number of customers connected to the system
before the determined date is calculated using the current FCC and FCE. However,the authorized
level of fixed cost recovery for customers added to the system after the date excludes generation
STAFF COMMENTS 3 MAY 12, 2026

and transmission-related fixed costs but continues to include distribution and other customer-
related fixed costs. This modification reduces the amount of FCC for new customers since the
Company does not invest in new generation and new transmission when individual R&SGS
customers are added to the system.
Calculation of the 2026-2027 FCA Rate
The Company proposes a rate surcharge for both the R&SGS customer classes. The
surcharge is based on the 2025 FCA Deferral Balance amount,which is $5,077,964 more than the
2024 FCA deferral balance of($3,051,774) in Case No. IPC-E-25-11. The Company's proposed
change to the Residential Service rate from the present rebate rate of 0.0503 cents per kWh to a
surcharge rate of 0.0330 cents per kWh, is an increase of 0.65% or$4,972,195, for the Residential
class. For the Small General Service class, the Company's proposed change to the present rebate
rate of 0.0614 cents per kWh to a surcharge rate of 0.0402 cents per kWh, is an increase of 0.65%
or$145,075. If the Application is approved, Staff calculates that the overall total increase for both
R&SGS classes is 0.65% or$5,117,270.
The Company proposes to increase the FCA rate for the R&SGS customer classes for the
2026-2027 FCA collection period to recover under-collection of fixed costs caused by actual
energy consumption falling below the baseline established in Case No. IPC-E-23-11. The
Company states that the rate change is based on 2026-2027 FCA annual sales,which are forecasted
to be higher than 2025-2026 FCA sales. Allen Direct at 18. Staff verified that these forecasted
sales are reasonable and align with the forecast used in the Company's concurrent Power Cost
Adjustment Mechanism application.
Using forecasted sales for June 1, 2026,through May 31, 2027, Staff agrees that surcharge
rates of 0.0330 cents per kWh for the Residential class and 0.0402 cents per kWh for the Small
General Services class, or a 0.65% increase, will provide the Company sufficient opportunity to
recover the 2025 FCA Deferral Balance.
Customer Notice and Press Release
The Company's press release and customer notice were included in the Application. Staff
reviewed the documents and determined that both met the requirements of Rule 125 of the
Commission's Rules of Procedure. IDAPA 31.01.01.125. The notice was included with billing
STAFF COMMENTS 4 MAY 12, 2026

statements mailed to customers from March 27 through April 25,2026. For customers enrolled in
paperless billing, the notice was e-mailed during the same period and included a link to the digital
version of the notice.
The Commission set a public comment deadline of May 12, 2026, and Staff believes the
deadline provided a reasonable opportunity for the public to submit comments. As of May 12,
2026, six customer comments have been submitted to the Commission opposing the Company's
proposal.
STAFF RECOMMENDATION
Staff recommends the Commission approve:
1. The Company's FCA filing with a net deferral balance of$2,026,190 for June 1, 2026,
through May 31, 2027; and
2. The Company's proposed Schedule 54 as filed.
Respectfully submitted this 12th day of May 2026.
Kelsea E. Ross
Deputy Attorney General
Technical Staff. Leena Gilman
I:\Utility\UMISC\COMMENTS\Comments.docx
STAFF COMMENTS 5 MAY 12, 2026

CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 12th DAY OF MAY 2026, SERVED
THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN CASE NO. IPC-
E-26-06, BY E-MAILING A COPY THEREOF, TO THE FOLLOWING:
LISA C. LANCE TIMOTHY E. TATUM
MEGAN GOICOECHEA ALLEN GRANT T. ANDERSON
REGULATORY DOCKETS CONNOR L. ALLEN
IDAHO POWER COMPANY IDAHO POWER COMPANY
PO BOX 70 PO BOX 70
BOISE ID 83707 BOISE ID 83707-0070
E-MAIL: llance(a�idahopower.com E-MAIL:
mgoicoecheaallengidahopower.com ttatum(a,idahopower.com
dockets(Jdahopower.com ganderson(Jdahopower.com
[e-mail]
PATRICIA JORDAII, SECRETARY
CERTIFICATE OF SERVICE