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Home My WebLink About20261014Staff Comments.pdf RECEIVED October 14, 2026 KELSEA E. ROSS IDAHO PUBLIC DEPUTY ATTORNEY GENERAL UTILITIES COMMISSION IDAHO PUBLIC UTILITIES COMMISSION PO BOX 83720 BOISE, IDAHO 83702 (208) 334-0318 IDAHO STATE BAR NO. 12050 Attorney for the Commission Staff BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION IN THE MATTER OF AVISTA ) CORPORATION'S APPLICATION FOR AN ) CASE NO. AVU-G-26-05 ORDER AUTHORIZING A DECREASE IN ) RATES CHARGED FOR NATURAL GAS ) DEMAND SIDE MANAGEMENT ) COMMENTS OF THE PROGRAMS ) 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 July 31, 2026, Avista Corporation, doing business as Avista Utilities ("Company"), applied to the Commission requesting authorization to decrease the rates under its natural gas tariff Schedule 191—Energy Efficiency Rider Adjustment ("Rider"), effective November 1, 2026, ("Application") in alignment with its application to suspend its natural gas demand-side management("DSM")programs in Case No.AVU-G-26-01 ("Suspension Request"). Application at 1. If approved,the Company's annual natural gas revenues would be reduced by approximately 1.6% and an Idaho residential natural gas customer using approximately 66 therms per month would see a $1.03 decrease in their monthly bill (i.e., decrease from $59.28 to $58.24). Id. at 7. The Company represented that it expects the Rider to be overfunded by approximately$1.2 million by November 1, 2026. Id. at 5. The Company projected that the Rider would be overfunded by almost$935,000 at the beginning of 2027. Id. STAFF COMMENTS 1 OCTOBER 14, 2026 The Company stated it was not proposing returning the Rider's overfunded balance to its customers at this time because the Company's DSM programs were going to continue to incur costs through 2026 and into 2027, as the Company continued to manage contractual obligations associated with its DSM programs. Id. at 5-6. The Company requested approval to change its tariff rider rate to$0.00 per therm, effective November 1, 2026. Id. at 6. STAFF ANALYSIS Staff reviewed the Company's Application and supporting workpapers. Based on its review, Staff recommends that the Commission approve the Company's Application and proposed Schedule 191 tariff, including the decrease in the Schedule 191 rate to $0.00 per them, effective November 1, 2026. The Company's natural gas revenues would decrease by approximately $1.4 million. Id. at 1-2. As provided in its Suspension Request in Case No.AVU-G-26-01, the Company proposed to temporarily suspend its natural gas DSM programs effective December 31, 2026. Id. at 3. The Company requested to suspend its natural gas DSM programs due to a lack of cost-effectiveness anticipated as a result of the latest natural gas avoided costs released as part of the Company's most recent Integrated Resource Plan. Id. The Commission approved the Company's Suspension Request, effective September 24, 2026, in Order No. 37181. The goal of DSM is to reduce costs passed to customers through rates by meeting demand with cost-effective demand-side resources. Cost-effective DSM, including energy efficiency programs and load management programs, is a significant resource that helps customers better control their utility bills, reduces the need for higher-cost supply-side resources, and increases system reliability. Cost-effectiveness is expressed as a using a ratio of the program's expenses to the monetized benefits of the energy saved from the Company's perspective known as the utility cost test("UCT").A UCT ratio greater than one indicates that the program is considered successful by generating more financial benefit than it cost to implement the program. As the cost of demand- side resources are ultimately passed to customers through rates, cost-effective DSM programs create downward pressure on rates. Staff believes that because the Company has requested suspension of its natural gas DSM programs due to a lack of cost-effectiveness, that it would not be prudent to continue charging customers for these non-cost-effective DSM programs. STAFF COMMENTS 2 OCTOBER 14, 2026 Staff agrees that the Schedule 191 Rider rates should decrease to $0.00 per therm effective November 1, 2026. Staff reviewed the Company's forecasted Schedule 191 Rider balance and believes that the projected balance is sufficient to cover the Company's forecasted remaining expenditures. Schedule 191 Rate Adiustment As of July 1, 2026, the Company reported that the Schedule 191 Rider balance was overfunded by approximately $2.3 million. Application at 5. The Company proposes to use the overfunded balance to honor its existing DSM program commitments and contractual obligations through December 31, 2026. Id. at 3-4. Programs with projected expenditures include Site- Specific Programs, the Residential Prescriptive Rebate Program, the Midstream Rebate Program, Northwest Energy Efficiency Alliance ("NEEA"), and the Limited Income Program. Id. at 4-5. The Company may continue to incur Site-Specific Program costs through 2027, and potentially into 2028, for projects accepted through December 31, 2026. Schedule 190 Proposed Tariff. The Limited Income Program has contracts with Community Action Partnership agencies through December 31, 2027. Application at 5. The Company's contract with NEEA includes a funding cycle extending through 2029. Id. at 4. In Order No. 37181 the Commission approved that the Company could continue funding the NEEA and the Limited Income contracts until the end of 2027, or until the rider balance reaches $0, whichever comes earlier. Order 37181 at 5. After finalizing program expenditures in 2026, the Company forecasts that the Schedule 191 Rider balance will be overfunded by approximately $935,000 at the beginning of 2027. Application at 5. The Company anticipates approximately $890,763 in DSM Rider expenditures in 2027. Id. at 6. The Company is not proposing to return the remaining Schedule 191 balance to customers at this time. Id. at 5. However,the Company will work with Staff if there is a remaining balance that needs to be refunded to customers after all natural gas DSM expenditures have been paid. Id. at 6. The Company provided a forecast of Schedule 191 revenues and DSM expenditures through October 2029, which Staff reviewed along with the associated rate calculations. The Company's workpapers show that the projected Schedule 191 Rider balance should be sufficient to cover the Company's forecasted natural gas DSM program expenditures through the end of its existing obligations. STAFF COMMENTS 3 OCTOBER 14, 2026 If approved, an average residential customer using 66 therms per month would see the customer's monthly bill decrease from $59.28 to $58.24, a decrease of $1.03 per month or approximately 1.7%. Application at 7. Staff verified that the Company properly applied the proposed Schedule 191 rates to the applicable customer classes, as shown in Table No. 1 below. Table No. 1: Schedule 191 Rates SCHEDULE PROPOSED RATE EXISTING RATE General Service - Sch. 101 $.00000 per Therm $.01568 per Therm Large General Service - Sch. 111 &. 112 $.00000 per Therm $.00711 per Therm Interruptible Sales Service - Sch. 131 & 132 $.00000 per Therm $.00711 per Therm Staff did not evaluate the prudency or cost-effectiveness for any of the Company's energy efficiency programs in this case. Such validation and additional review were not requested in this case and are occurring in Case No. AVU-G-26-06, which is currently pending before the Commission. Overall Impact of Three Filings (Rider, PGA, and FCA) Effective November 1, 2026 The Company filed two other applications with rate adjustments and requested effective dates of November 1,2026. The Company's natural gas Purchased Gas Cost Adjustment("PGA"), Case No.AVU-G-26-03 ("PGA Application"),was filed on July 31,2026, and requests a decrease in natural gas revenues of approximately $2.5 million, or 3.0%. PGA Application Customer Notice at 1. The Company's natural gas Fixed Cost Adjustment ("FCA"), Case No. AVU-G-26- 02 ("FCA Application"), was filed on July 31, 2026, and requests an increase in the Company's overall natural gas revenues of approximately $2.4 million, or 2.8%. FCA Application Customer Notice at 1. The net effect of the Company's three filings (FCA, Rider, and PGA) would decrease natural gas revenues by approximately $1.5 million, or 1.8%. Rider Customer Notice at 1. The average residential natural gas customer's monthly bill would decrease by approximately $0.90, or 1.5%, if all three filings are approved as filed. Application at 7. STAFF COMMENTS 4 OCTOBER 14, 2026 Table No. 2 below shows the effect of all three cases if approved as filed. Table No. 2: Summary of Overall Impact to Natural Gas Revenues Case $ Revenue Change %Revenue Change EE Tariff ($1.4 million) (1.6%) PGA ($2.5 million) (3.0%) FCA $2.4 million 2.8% Total ($1.5 million) (1.8%) CUSTOMER NOTICE AND PRESS RELEASE The Company's press release and customer notice' were included with its Application. Staff reviewed the documents and determined 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 statements mailed to customers from August 4 through September 1,2026. 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 October 14, 2026,which Staff believes provides customers with a reasonable opportunity to file timely comments. As of October 14, 2026, no customer comments have been submitted to the Commission. STAFF RECOMMENDATION Staff recommends that the Commission approve the Company's Application and the proposed Schedule 191 tariff, as filed, including the decrease in the Schedule 191 Rate to $0.00 per therm, effective November 1, 2026. Additionally, Staff recommends that the Commission consider any late-filed customer comments. 1 The press release and customer notice addressed the following cases. Electric: AVU-E-26-05 Power Cost Adjustment (PCA), AVU-E-26-06 Fixed Cost Adjustment (FCA), and AVU-E-26-07 Bonneville Power Administration Residential Exchange (ResEx). Natural Gas: AVU-G-26-02 Fixed Cost Adjustment(FCA),AVU- G-26-05 Energy Efficiency,and AVU-G-26-03 Purchased Gas Cost(PGA). STAFF COMMENTS 5 OCTOBER 14, 2026 Respectfully submitted this 14th day of October 2026. Kelsea E. Ross Deputy Attorney General Technical Staff. Laura Conilogue STAFF COMMENTS 6 OCTOBER 14, 2026 CERTIFICATE OF SERVICE I HEREBY CERTIFY THAT I HAVE THIS 141h DAY OF OCTOBER 2026, SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF , IN CASE NO. AVU-G-26-05, BY E-MAILING A COPY THEREOF TO THE FOLLOWING: ANNI GLOGOVAC SHAWN BONFIELD COUNSEL FOR REGULATORY SR. MGR. REGULATORY POLICY & STRATEGY AFFAIRS AVISTA CORPORATION AVISTA CORPORATION PO BOX 3727 PO BOX 3727 SPOKANE WA 99220-3727 SPOKANE WA 99220-3727 E-mail: shawn.bonfieldkavistacorp.com E-mail: anni.glo og vac(cavistacorp.com avistadocketskavistacorp.com 4 PATRICIA JORDA1q, SECRETARY CERTIFICATE OF SERVICE