20020507Preston Public Hearing.pdf

1 PRESTON, IDAHO, TUESDAY, MAY 7, 2002, 7:30 P. M.

2

3

4 COMMISSIONER SMITH: Welcome. This is the

5 time and place set for a public hearing before the Idaho

6 Public Utilities Commission in Case No. PAC-E-02-1,

7 further identified as in the matter of the application of

8 PacifiCorp dba Utah Power & Light Company for approval of

9 changes to its electric service schedules.

10 I would first like to begin by introducing

11 the Commission. My name is Marsha Smith. I'm going to

12 be Chairman of tonight's hearing. On my right is

13 Commissioner Paul Kjellander who is also president of the

14 Commission, and on my left is Commissioner Dennis

15 Hansen. The three of us make up the entire Commission

16 and are the decision makers for this matter.

17 Next, we'll take appearances of the

18 parties. For the Applicant.

19 MR. FELL: My name is James Fell. I'm the

20 attorney for PacifiCorp.

21 COMMISSIONER SMITH: For the Staff.

22 MR. WOODBURY: Scott Woodbury, Deputy

23 Attorney General, for Commission Staff.

24 COMMISSIONER SMITH: Mr. Budge.

25 MR. BUDGE: Randy Budge for Monsanto

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1 Company.

2 COMMSSIONER SMITH: Are there any -- oh,

3 Mr. Shurtz.

4 MR. SHURTZ: Tim Shurtz, pro se.

5 COMMISSIONER SMITH: Are there other

6 intervenors which are present at tonight's hearing who

7 wish to make an appearance? The record will show that

8 there are none. The next thing I'd like to do is

9 recognize some distinguished guests. We have present

10 tonight, we have Senator Bob Geddes is here with us,

11 Representative Tom Lurcher, Representative Bradford,

12 Representative Eulalie Langford, Representative Wheeler,

13 and then we also have some special guests that members of

14 the Commission were excited to see, our former

15 legislators John Tibbetts, Representative Robert Geddes,

16 Sr. and Representative Sherret. It's a pleasure to see

17 all of you again.

18 Tonight's hearing is a public hearing which

19 means we're here to listen to the comments of the members

20 of the public who are customers of Utah Power & Light.

21 When the Commission sits in a case like this, it's in a

22 quasi judicial capacity. We have a court reporter here

23 who will take down verbatim minutes of everything that is

24 said. That way your comments will be part of the record

25 in this case and part of the material upon which the

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1 Commission relies when it makes its decision.

2 Because when we sit like this, we're like a

3 district court, it is not appropriate to call out from

4 the audience, to clap or to in any way disrupt the

5 proceeding. It's also impossible for the court reporter

6 to make a verbatim transcript if more than one person

7 speaks at a time, so we hope you'll cooperate in keeping

8 our process orderly.

9 The other thing that may be different is

10 that this is our opportunity to listen to you, but it is

11 not an opportunity for you to ask questions of the

12 Commission. When we're concluded or if we take a break,

13 that's the time to talk to the parties who are present

14 about your concerns with the issues in the case, so when

15 I call your name of those who have signed up to testify,

16 you'll come forward to the mike at the table in front of

17 us. Commissioner Kjellander will ask you to raise your

18 hand and promise to tell the truth and then when you sit

19 down, our Staff attorney Scott Woodbury will ask you your

20 name and your address and that way, we will have you

21 properly identified for the record.

22 With that introduction, then let's go to

23 our first name which is Herbert Rallison.

24

25

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1 HERBERT S. RALLISON,

2 appearing as a public witness, having been first duly

3 sworn, testified as follows:

4

5 EXAMINATION

6

7 BY MR. WOODBURY:

8 Q Mr. Rallison, will you please state your

9 full name and spell your last name for the record?

10 A Herbert S. Rallison. My last name is

11 spelled R-a-l-l-i-s-o-n.

12 Q Mr. Rallison, where do you live?

13 A 908 South 1200 East, Preston, Idaho.

14 Q Thanks, you may give your comments.

15 A I have in my hand three contracts with

16 utility companies. One was the gas company, one was the

17 light company and the phone company. I had to make

18 these -- I have three hats on, you might say. I'm an

19 irrigator, so I pay a pumping cost; I'm a consumer of

20 electricity; plus I developed my own land into a housing

21 project. These contracts are on the housing project. I

22 had to honor them and when I got to Utah Power & Light,

23 it changed to Scottish Power. I called up and they said,

24 well, we don't know anything about them, but after I gave

25 them the contract and everything, I finally got my money

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1 back from them.

2 Now, I consider that they made a contract

3 with us in Idaho. We really didn't agree on it here to

4 the merger, but the Public Utilities Commission board

5 seen fit to go ahead and accept this merger, but the

6 people here didn't and I've heard the comment lately why

7 go to this meeting, they didn't do what we wanted last

8 time, but I still think that we made a contract and they

9 made the statement that they wouldn't raise rates.

10 Now, I don't care how you cut and dry it,

11 this Bonneville kickback that we get for letting them use

12 the water and the dams in Idaho, we're still getting a

13 rate increase if they cut that in any way, shape or form,

14 and didn't they say four years? I don't think it's up.

15 That's all I have to comment on the

16 situation, but I don't think it's fair when they can

17 state statements and then turn around and change those

18 statements and go ahead and do what they want. I thank

19 the Commission for hearing me and that's my feelings on

20 it.

21 COMMISSIONER SMITH: Okay, if you would

22 just stay seated for a moment, let's see if there are any

23 questions for you. Mr. Woodbury?

24 MR. WOODBURY: Mr. Rallison, Senator Geddes

25 I think in his presentation before showed a couple of

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1 press releases indicating the Company's representations

2 that they would keep rates, not raise rates for, I think,

3 three to five years, somewhere in there. I'm not sure

4 where four years lies, except somewhere in the middle of

5 that, but this Commission, tonight we are establishing a

6 record and these Commissioners are bound to issue their

7 orders based upon the written record, so I'm not sure

8 whether three to five years was part of the written

9 record, but the Commissioners sat on the case and they

10 could bring that up. This case got quite a lot of play

11 in eastern Idaho in the newspapers and with politicians

12 and with the Company coming through and talking to

13 people, but nevertheless, the Commission is a creature of

14 statute and it's bound to make its decisions based upon

15 the written record before it.

16 COMMISSIONER SMITH: I don't think that was

17 a question, Mr. Woodbury.

18 MR. WOODBURY: It wasn't. It was a

19 comment.

20 COMMISSIONER SMITH: Well, this is not the

21 time for Staff comments.

22 MR. WOODBURY: Essentially I was asking

23 does he understand how the Commission makes its

24 decisions.

25 COMMISSIONER SMITH: If you would like to

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1 respond to that, you may, but you don't have to.

2 THE WITNESS: I'm not going to waste my

3 time to respond to that.

4 COMMISSIONER SMITH: Let's see, are there

5 questions from the Commission? Thank you very much.

6 (The witness left the stand.)

7 COMMISSIONER SMITH: Garth Esplin? No

8 longer here. Charles Ross.

9 MR. ROSS: I changed my mind.

10 COMMISSIONER SMITH: All right, Dan

11 Keller.

12

13 DANIEL M. KELLER,

14 appearing as a public witness, having been first duly

15 sworn, testified as follows:

16

17 EXAMINATION

18

19 BY MR. WOODBURY:

20 Q Mr. Keller, will you please state your full

21 name and give your address?

22 A Daniel Martin Keller. I live at 194 Valley

23 View Drive, Preston, Idaho.

24 Q Thanks. You can give your statement.

25 A I can go ahead? Well, first of all, thanks

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1 for coming down, Commissioners. Our input didn't do a

2 lot of good last time two years ago, but hopefully, it

3 will do a little bit of good this time. I'm concerned

4 about the implied agreement. Legally, I guess it was not

5 a formal contract. I can buy that, but I do have the

6 impression as do most of the other citizens in this area

7 anyway that the moral equivalency of this agreement

8 counted for something and just because of the excess

9 power costs that were incurred because of no one's fault,

10 I don't believe the local ratepayers should have to pay

11 for that.

12 Now, in spite of all the reasons, my

13 biggest concern is this: I'm concerned about the

14 precedent that this will set. Say next week, two years,

15 four years, any time down the road, say we have another

16 volatile period in our country or in our economy when

17 power costs reach record levels again. Here we are, we

18 have this excess power problem again. Is the Company

19 going to come running back and hey, we've got these

20 excess power costs again, it's no fault of our own, we

21 didn't manage correctly, we didn't manage appropriately.

22 It doesn't matter to me if some equipment failed. I

23 mean, that's just part of business.

24 In business, unanticipated things happen

25 and I'm concerned that we're setting a precedent here,

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1 Commissioners, where if the power costs go up or if

2 there's any other unanticipated expenses, the Company can

3 come running back to the Commission because it worked

4 last time and they can get additional increases in the

5 rates.

6 Now, I pulled out the Company's 10-Q report

7 that was sent to the United States Securities and

8 Exchange Commission. This 10-Q report only gave income

9 and expense information as well as other information of

10 the Company through the third quarter of 2002. Now, as

11 you know, PacifiCorp is on a fiscal year-end basis.

12 Their fiscal year ends on March 31st of every year. The

13 fiscal year-end income and expense information for 2002

14 was not available as near as I can tell, but I do have

15 third quarter information and I'd like to read a couple

16 of things, if you don't mind, from this 10-Q report.

17 Again, this is for three-quarters of the

18 fiscal period of 2002. The report says, "The Company

19 recorded net income of $214 million in the 2002 period

20 compared to the net loss of 90 million in the 2001

21 period," just a quick editorial here. I'm curious if

22 PacifiCorp is going to propose another rate reduction

23 because of this excess profit they received in 2002

24 compared to their excess power costs in 2001.

25 The Company goes on and says, "During the

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1 third quarter of 2002, the Company experienced

2 electricity prices that were at levels closer to those

3 embedded in its tariff structure. These were the lowest

4 prices that the Company had seen in over a year," so as

5 far as -- and there's other comments in here about how

6 the increase in the quarter in profit was primarily

7 attributable to much lower purchased power costs.

8 The issue is very fundamental. They had

9 excess power expenses in 2001. In 2002, they had much

10 lower power costs. It seems to me like they should abide

11 and structure their operation like any other blue chip

12 company does in this country, absorb the losses when they

13 occur and then make better management decisions as they

14 move forward and that's all I have at this time. I just

15 want to express that I am not in favor of their proposed

16 increase.

17 COMMISSIONER SMITH: Okay, Mr. Keller,

18 thank you. Let's see if there are questions.

19 Mr. Fell.

20

21 CROSS-EXAMINATION

22

23 BY MR. FELL:

24 Q Good evening, Mr. Keller.

25 A Hello.

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1 Q I appreciate you being here, too, and I

2 appreciate your reading the 10-Q. On the 10-Q, let me

3 just point out to begin with that there are -- I'm not

4 sure how things are reported with regard to financial

5 reporting, because sometimes deferred accounts are

6 treated as revenues for purposes of deferred reporting, I

7 mean, for financial reporting purposes, so I'm not sure

8 how, whether that statement reflects the partial recovery

9 that the Company has been getting on its deferred costs.

10 Do you understand what I've said on that?

11 A I do understand that and I didn't want to

12 take more time on the 10-Q. If I was going to take more

13 time, though, I would also emphasize that because of

14 interest rate reductions the last 12 months, the 10-Q

15 reports an interest savings of $64 million from 2001 to

16 2002. I could go on and on, but I didn't want to take

17 all the time doing that. I don't profess to be an expert

18 on PacifiCorp. I'm just reading what was given to me as

19 was filed to the SEC, so I do appreciate what you're

20 saying, but I think there are much other issues that

21 could be discussed if the time would allow for that.

22 Q Now, the other issue I wanted to explore,

23 the Company had an obligation to serve its load, do you

24 understand that point? That if customers wanted to use

25 electricity, the Company had an obligation to provide

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1 that, do you understand that?

2 A Well, I do understand that they have the

3 obligation primarily because they're a monopoly.

4 Q Yes, that's correct, but there is an issue

5 here because the power prices went so high, power prices

6 went absolutely through the roof, unprecedented levels,

7 there is an issue about whether in the future whether the

8 Company should be buying power at those prices or should

9 curtail service and I'm wondering if you have an opinion

10 about which way you think they should proceed on that,

11 because the only way in a sense for consumers to gain

12 some power over high market prices is to consume less.

13 A I do have an opinion. I do not have a

14 problem with PacifiCorp asking for the increase if when

15 their costs are reduced they would ask for a rate

16 reduction, and I am not schooled in the recent history of

17 the Company other than I do not recall us ever having a

18 public hearing asking the Commission for a reduction

19 because of lower costs. I'm saying you shouldn't be able

20 to have it both ways. If you want an allowance because

21 costs are up, great, then give us a benefit when costs go

22 down. That's my opinion.

23 Q Were you a customer when Utah Power and

24 Pacific Power merged back in 1989?

25 A I was.

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1 Q And do you recall any rate increase that

2 Utah Power has come to this Commission for this service

3 territory since then?

4 A Not specifically, no.

5 Q All right, but that's a pretty long time

6 with no increase. There are some situations where

7 decreases are good and others where no increase is good

8 for a long period of time.

9 A But because I do not recall it, you're

10 implying that there was none?

11 Q I think there was none. Yes, I think

12 that's the situation, there was none basically since 1989

13 or before that time.

14 A All I know is since that time we were

15 paying half the cost that Idaho Power customers were

16 paying, so you're probably correct, but it seems like

17 we've always been on the short end of the stick down here

18 in southeast Idaho.

19 MR. FELL: I respect that opinion. I

20 regret it, but I respect it and thank you. That's all.

21 THE WITNESS: Thank you.

22 COMMISSIONER SMITH: Commissioner Hansen.

23

24

25

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1 EXAMINATION

2

3 BY COMMISSIONER HANSEN:

4 Q Mr. Keller, I've got a couple of

5 questions. In your mind, what was the public's

6 perception of the two-year rate moratorium?

7 A In my mind, Commissioner Hansen, the

8 perception was that was the carrot that was needed for

9 the Commission to approve the merger between Scottish

10 Power and PacifiCorp. That was the straw that broke the

11 camel's back, if you will. That was the only reason it

12 was finally approved. That's the public's perception.

13 Q Thank you. Do you think there is a value

14 to the customer that rates wouldn't raise for two years,

15 but after the two years was up, the Company could go back

16 and collect on costs they incurred during the two-year

17 moratorium period, do you think that's a value to the

18 customer?

19 A That's a bunch of nonsense. There's no

20 value to the customer there, no.

21 Q Well, don't you think it was a value that

22 they could go two years without a rate increase?

23 A Not if they could come back and get it

24 later, no.

25 Q So you don't see a value in that?

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1 A I would like to try that in the banking

2 business.

3 COMMISSIONER HANSEN: Thank you very much.

4 THE WITNESS: You're welcome.

5 COMMISSIONER SMITH: Thank you for your

6 testimony, Mr. Keller. I'd just say that if you'd like

7 to trade rates with Idaho Power customers any time after

8 the 16th of May, I'm sure that they'd be happy, because I

9 believe that the short end of the stick has been passed

10 to the western part of the state.

11 (The witness left the stand.)

12 COMMISSIONER SMITH: Frank Priestley.

13

14 FRANK PRIESTLEY,

15 appearing as a public witness, having been first duly

16 sworn, testified as follows:

17

18 EXAMINATION

19

20 BY MR. WOODBURY:

21 Q Mr. Priestley, will you please state your

22 full name and spell your last name?

23 A Frank Priestley, P-r-i-e-s-t-l-e-y. I live

24 at 3473 South 3200 East, Franklin, Idaho.

25 Q Thank you. You may proceed.

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1 A Madam Chairman, I'm Frank Priestley. I'm

2 the president of the Idaho Farm Bureau Federation and I'm

3 speaking tonight on behalf of our 52,700 family members

4 and Idaho Farm Bureau opposes the stipulated agreement

5 and the power cost surcharge agreement for the following

6 reasons: If the Commission approves the stipulated

7 agreement, then the Commission has circumvented the

8 two-year rate freeze it placed on Scottish Power and the

9 benefit it provided to the ratepayers who had the

10 expectations of no rate increase for two years.

11 Granting PacifiCorp the opportunity to

12 recover the deferred costs incurred during that time

13 frame undermines the benefits of the merger agreement to

14 ratepayers and the Commission Staff. PacifiCorp claims

15 it is not asking for a rate increase, but instead asking

16 ratepayers to reimburse it for the cost of doing business

17 during that time.

18 What good is a rate moratorium if

19 PacifiCorp is reimbursed for the cost of doing business

20 during the same time period? Neither the ratepayers nor

21 the Commission Staff would have supported the merger if

22 they had known that PacifiCorp could petition the

23 Commission for cost reimbursements under the rate

24 freeze. Allowing PacifiCorp to recover deferred costs as

25 requested allows rates to increase based on an isolated

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1 look at wholesale power costs while ignoring its revenue

2 and responsibilities.

3 The stipulated agreement also includes a

4 rate mitigation adjustment, or MA, intended to assure

5 that no customer's class will receive an increase during

6 the two-year period of the surcharge. The RMA will be

7 implemented in a line item charge on the customer's bill

8 if the Commission approves the excess power costs. Now,

9 how can the ratepayers trust the Commission that the RMA

10 will be honored and, lastly, the ratepayers should

11 receive the full 44 percent rate decrease provided

12 through the BPA credits instead of the 27 percent

13 provided by the stipulated agreement.

14 Madam Chairman, I feel that as was brought

15 out earlier by Mr. Keller the fact that when there is a

16 profit made, I hail the Company, I think that they should

17 sell wholesale power if they have excess power,

18 especially at the rates that they was able to sell it to

19 here last year, but is that money turned back, is the

20 profits turned back to the ratepayers and if it is not,

21 then why should the ratepayers pay for the expenses that

22 was accrued previous.

23 Thank you, Ma'am.

24 COMMISSIONER SMITH: Thank you. Let's see

25 if there are questions. Questions for Mr. Priestley?

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1 Mr. Fell.

2

3 CROSS-EXAMINATION

4

5 BY MR. FELL:

6 Q Yes, Mr. Priestley, I'd like to ask you one

7 question that I asked Mr. Keller because I don't know

8 that I got that it was clear in what his answer was. If

9 you have a choice as an irrigation customer of Utah Power

10 to have Utah Power go out and buy high-cost power to meet

11 summer irrigation load to make sure that your load is

12 served or have them have rolling blackouts or other

13 curtailment methods so that they can avoid having to buy

14 that high-priced power, which choice would you want them

15 to take?

16 A Sir, I have got the power that I pump with

17 and we are on the plan that you can shut the power off if

18 you need to; however, we need the power. I think the

19 answer to that is I would rather have the power and pay

20 the cost, but I think that the problem that we have here

21 is not only the fact that we have the high cost of

22 electricity, but there was also a mechanical failure

23 which had to be -- it wasn't anybody's fault, I mean, it

24 happens, but that's part of doing business and I think

25 that that's a major part of what the cost is that you're

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1 trying to pass on to us.

2 MR. FELL: Thank you.

3 COMMISSIONER SMITH: Questions? Thank you

4 very much. Oh, I'm sorry, Mr. Shurtz.

5

6 CROSS-EXAMINATION

7

8 BY MR. SHURTZ:

9 Q Mr. Priestley, during the merger hearings,

10 did the Farm Bureau intervene? I noticed that they were

11 listed as an intervenor and correct me if I'm wrong,

12 during the --

13 A You know, I'm not positive if we did or

14 not. We were against the merger, but I'm not sure if we

15 were an intervenor. Maybe one of the Commissioners can

16 answer that for us.

17 Q Also -- do you want to answer that?

18 COMMISSIONER SMITH: No.

19 Q BY MR. SHURTZ: Also, you mentioned rate

20 moratorium, and in your mind, what did the rate

21 moratorium mean just flat out?

22 A I think a moratorium is when they said that

23 they would do what they told us they would do and that

24 was no rate increase; however, this is not a rate

25 increase according to their verbiage, but when I pay more

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1 out of my pocket, it's an increase.

2 MR. SHURTZ: Okay, thank you.

3 COMMISSIONER SMITH: Commissioner Hansen.

4

5 EXAMINATION

6

7 BY COMMISSIONER HANSEN:

8 Q Mr. Priestley, I do have one question and I

9 guess it's because you represent such a large body of

10 people with the Farm Bureau, but it would be the same

11 question I asked Mr. Keller, do you think there was a

12 value to the customers that the rates were not raised for

13 the two years knowing now that the Company could go back

14 and collect on the costs they incurred during that time?

15 Do you still think there's a value, though, to the Farm

16 Bureau customers that rates didn't go up for the last two

17 years?

18 A Well, yes, we thought that there would be

19 some value there for two years. I mean, two years isn't

20 a very long time when you look at the time that we're

21 here and going be supplied by Utah Power or by

22 PacifiCorp. We hope that we always have electricity and

23 so, yes, that was somewhat of a carrot.

24 COMMISSIONER HANSEN: Thank you.

25 COMMISSIONER SMITH: Commissioner

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1 Kjellander.

2

3 EXAMINATION

4

5 BY COMMISSIONER KJELLANDER:

6 Q I guess I'd like to ask the same question

7 maybe a different way. With the merger condition that

8 was imposed, condition No. 2, which is the focus of a lot

9 of your discussion there, and also coupled with the

10 merger credit, was it a benefit to members of your

11 organization to actually see rates go down and be

12 stabilized and stay down as a result of those two

13 conditions?

14 A Certainly it's an advantage to us if the

15 rates go down and stay down. Our pumping cost is one of

16 the big expenses that we have on our farms and when the

17 crop commodity prices are down and pumping rates go

18 higher, certainly it affects the bottom line.

19 COMMISSIONER KJELLANDER: Thank you.

20 COMMISSIONER SMITH: Thank you very much,

21 Mr. Priestley.

22 (The witness left the stand.)

23 COMMISSIONER SMITH: William B. Handy.

24

25

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1 WILLIAM B. HANDY,

2 appearing as a public witness, having been first duly

3 sworn, testified as follows:

4

5 THE WITNESS: William Handy, H-a-n-d-y, 60

6 East Second North, Preston, Idaho. Basically the

7 condition in the Order that was for the approximate two

8 years says a rate moratorium. The other thing is the

9 timing of the loss of the Hunter coal plant and the

10 Company's sales contracts of 2000 and 2001, the question

11 or the comment that I'd like to make is the system

12 started out as a distributed power system, generating

13 system, before there was anything that was called Utah

14 Power & Light. Preston City used to have its own power

15 supply, then it was rolled into another system and then

16 into another system. Eventually, as has been stated, we

17 were bought out by a foreign company.

18 When this all came about, we were brought

19 into this meeting and we were told there were going to be

20 benefits derived from it and I have heard about past

21 benefits and future benefits. My main question is or

22 comment, to be more precise, is this: PacifiCorp is an

23 international company now, just part of Scottish Power.

24 Let's call it what it is. It is a foreign company.

25 My question or comment is simply and stated

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1 this way: The BPA credit is for the people in this area

2 who have a right to the credit because of use and right

3 of the water in this state. The Idaho Public Utilities

4 Commission, in my opinion, has the obligation to take

5 care of all of the citizens of this state and we have the

6 responsibility as people here to ask these questions.

7 The question or comment that I would like

8 to make on the final issue of this whole thing is the

9 Northwest Power Planning and the concept of the Power

10 Commission that give us the BPA credit passed it to us.

11 Now a foreign company wants to take it away from us. It

12 might sound academic, but when my parents' phone bill

13 goes up or my phone bill goes up or my electric bill goes

14 up or when my rates go up, I don't care what you call it,

15 I don't want to be Enron, I don't want you to play like

16 I'm Arthur Andersen, I don't want the accounting

17 gimmicks. If you're going to raise my rates, tell me

18 so. If you're not going to raise them, tell me so.

19 Don't tell me this week, yes, we're going to give you a

20 rate increase. Next week, no, we're not going to. Yes,

21 we're going to give you a credit on the 21st of this

22 month and three months later, no, we're not. When you

23 start giving us mixed signals, then who can we trust.

24 That's my comment. I just don't trust you any more.

25 COMMISSIONER SMITH: Thank you. Let's see

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1 if there are comments or I mean questions for Mr. Handy.

2 MR. FELL: No questions.

3 MR. WOODBURY: No questions. Thank you.

4 COMMISSIONER SMITH: Mr. Shurtz.

5

6 CROSS-EXAMINATION

7

8 BY MR. SHURTZ:

9 Q Mr. Handy, do you feel that a lot of your

10 confusion, and I've got to tell you I had a lot, a lot of

11 your confusion is because of just a lot -- it's very

12 complex and there's been a lot of -- not a lot of

13 information and a lot of conflicting stories that you've

14 heard on this issue?

15 A We've been out of the loop. The large

16 people in this situation are in the loop. The Power

17 Company is in the loop, Monsanto is in the loop, the

18 irrigators are in the loop, the general residential

19 customer, he's standing outside looking in and then you

20 wonder why we're unhappy. When you come to us after

21 everything is all said and done and say what do you

22 think, what do you expect us to think. We've been left

23 out. Of course, we're mad as hell.

24 It would be nice to have you come up to us

25 and say okay, what do you think before this all happens.

409

CSB REPORTING HANDY (X)
Wilder, Idaho 83676 Public

1 Give us some credit for knowing that a credit is a

2 credit, that a moratorium is a moratorium, that more

3 money out of my pocket is more money out of my pocket,

4 that if a company tries to go into a contract and can't

5 meet their obligations that they're not going to want to

6 have to pay it, they're going to want somebody else to,

7 that's human nature, but at least give me the common

8 courtesy of letting me part of the system when it starts,

9 not when it finishes.

10 It gives the impression that everything is

11 all done, it's a done deal. That's the way I look at

12 it. It's kind of like you've come down to go through the

13 motions because it's all done, it's all stipulated. All

14 we have to do now is sign off and just come out and show

15 up just to make it look good so that it will look good on

16 the paper for history.

17 MR. SHURTZ: Thank you.

18 THE WITNESS: Thank you.

19 COMMISSIONER SMITH: Thank you for your

20 testimony.

21 (The witness left the stand.)

22 COMMISSIONER SMITH: Jane Lucas.

23

24

25

410

CSB REPORTING HANDY (X)
Wilder, Idaho 83676 Public

1 JANE LUCAS,

2 appearing as a public witness, having been first duly

3 sworn, testified as follows:

4

5 EXAMINATION

6

7 BY MR. WOODBURY:

8 Q Please state your full name and spell your

9 last name for the record.

10 A Pardon?

11 Q State your full name.

12 A Jane Lucas.

13 Q L-u-c-a-s?

14 A Pardon?

15 Q How do you spell your last name?

16 A L-u-c-a-s.

17 Q Where do you live?

18 A 1502 West 4400 North, Preston, but that is

19 Winder, if you know the area.

20 Q Thank you very much.

21 A I'm really glad to see and find out who the

22 members here are from PUC. I was beginning to think this

23 was a meeting run by Scottish Power after the first

24 workshop. When I first came here, it was about the time

25 this merger was happening. I thought oh, how lovely,

411

CSB REPORTING LUCAS
Wilder, Idaho 83676 Public

1 they'll drop the rates, they'll have better service, they

2 won't cut off water on the Snake River so they can run

3 their turbines a little faster, et cetera.

4 From what I read in the paper, they want to

5 raise the rates again. I did have one month of a lower

6 rate and my dogs got real excited, they thought they were

7 going to get more food, but the rates are going back up.

8 This week four times I've had to reset my clocks because

9 we've had power flickers and I understand they're going

10 to be cutting off water in the Snake River which is going

11 to affect the recreational usage people, certain parts of

12 it, not all of it, and I don't know where because it's

13 something I read in the paper, so I have to assume it's

14 right.

15 One thing that really bothers me, I didn't

16 see with all those lovely graphics and so on where any

17 money was being set aside to repair, I think it's, the

18 Hunter plant down in Utah which caused all this problem.

19 Right at their peak time it decided to quit because it

20 hadn't been taken care of. Well, I can understand that.

21 If I drive my car without oil, it would probably quit on

22 me, too, but as a so-called prudent automobile driver, I

23 put oil in it and I should think as prudent business

24 people, whatever their name is, PacifiCorp, Scottish

25 Power, whoever, would have noticed this plant was in bad

412

CSB REPORTING LUCAS
Wilder, Idaho 83676 Public

1 shape, because I've had several neighbors tell me oh,

2 that's given them trouble for years, so they apparently

3 came in, counted on the power to come from that plant

4 without putting in the necessary repairs or additions and

5 I didn't see in those lovely graphics profits to their

6 investors which I'm sure are a criteria.

7 You know, most people do expect to get a

8 profit when they invest in a company and I think all of

9 us would be a little more willing to go with these

10 changes if we knew that the Company and the executives,

11 the investors, et cetera were doing the same thing that

12 we were, having to tighten our belt.

13 I don't want to take the porridge out of

14 the wee baron's mouth, but I don't want to take it out of

15 our mouths either. I guess I'd really like to challenge

16 Scottish Power, whoever, to drop their Enron tendencies

17 and I don't mean this personally because I have no idea

18 about you folks. I've been places where they have pretty

19 dirty politics. I'm going to hope that you don't, but I

20 would like to challenge you to remember the Public

21 Utilities Commission is on the side of the public, not

22 the utility company.

23 COMMISSIONER SMITH: Does that conclude

24 your statement?

25 THE WITNESS: That concludes it.

413

CSB REPORTING LUCAS
Wilder, Idaho 83676 Public

1 COMMISSIONER SMITH: Let's see if there are

2 any questions.

3 Mr. Fell.

4

5 CROSS-EXAMINATION

6

7 BY MR. FELL:

8 Q This may be unfair, but --

9 A I can't hear you.

10 Q I'd like to clarify that the Company did

11 have insurance on the generator that failed and that the

12 insurance company is going to be paying that money. That

13 money is not being sought in any of this proceeding.

14 A Then why are we having to pay for the money

15 that was spent on the excess costs of buying the material

16 because they didn't have it?

17 Q Well, the cost the Company is seeking to

18 recover here are the costs to buy the power that Hunter

19 wasn't able to produce.

20 A They didn't get insurance to help cover the

21 cost of extra power?

22 Q No, they did not have that. They rely

23 on --

24 COMMISSIONER SMITH: Mr. Fell, I think that

25 would be an interesting --

414

CSB REPORTING LUCAS (X)
Wilder, Idaho 83676 Public

1 MR. FELL: She's cross-examining me.

2 COMMISSIONER SMITH: -- this would be an

3 interesting discussion for you and Ms. Lucas to have at a

4 break or after the hearing.

5 MR. FELL: I concede.

6 THE WITNESS: To me that isn't necessarily

7 prudent management.

8 COMMISSIONER SMITH: Are there other

9 questions?

10 Commissioner Hansen.

11 COMMISSIONER HANSEN: Just one quick

12 question.

13

14 EXAMINATION

15

16 BY COMMISSIONER HANSEN:

17 Q You mentioned that this last month you

18 finally got some lower rates. I was kind of curious, do

19 you use the time of day metering?

20 A Pardon?

21 Q Do you use the time of day metering where

22 it's a different price if you use the electricity on the

23 weekends or in the late evenings?

24 A Afternoon and early evening.

25 Q Uh-huh. Well, I think they have it, so I

415

CSB REPORTING LUCAS (Com)
Wilder, Idaho 83676 Public

1 was wondering, are you familiar with the time of day

2 metering?

3 A Well, a couple of times it was during the

4 afternoon.

5 Q Well, it's more in the evenings, like, I

6 believe, after 10:00 o'clock and before 7:00 in the

7 morning?

8 A Yeah, between, like 6:00 and --

9 Q Are you on that system?

10 A Pardon?

11 Q Are you on that system?

12 A Uh-huh.

13 Q Are you?

14 A Yeah, I live out there where the power pole

15 goes like this [indicating] and they assured me that

16 nothing was wrong with that pole.

17 COMMISSIONER HANSEN: Okay.

18 THE WITNESS: At least it goes away from my

19 house, not towards it.

20 COMMISSIONER SMITH: That's good. Thank

21 you very much.

22 THE WITNESS: You're welcome.

23 (The witness left the stand.)

24 COMMISSIONER SMITH: Eldon Wilcox.

25

416

CSB REPORTING LUCAS (Com)
Wilder, Idaho 83676 Public

1 ELDON WILCOX,

2 appearing as a public witness, having been first duly

3 sworn, testified as follows:

4

5 EXAMINATION

6

7 BY MR. WOODBURY:

8 Q Mr. Wilcox, will you please state your name

9 and spell your last name for the record?

10 A Eldon Wilcox, W-i-l-c-o-x.

11 Q Where do you reside, sir?

12 A 6008 East Highway 36 in Preston.

13 Q You may give your statement.

14 A I'm just a little guy. I'm here for my

15 family. I'm personally disappointed we don't have more.

16 I thought this room would be filled today, but it isn't

17 and I'm here to stand up for myself. I don't agree with

18 this recovering costs or whatever it is. It's called

19 here in the matter of the application of PacifiCorp for

20 approval of changes. Well, those changes are going

21 upward it looks like and I don't agree with it. That's

22 as simple as I can state it. It represents to me a rate

23 increase because it's more money out of my pocket. It

24 can't be any simpler than that for a little guy like

25 myself and there's got to be thousands of us out there

417

CSB REPORTING WILCOX
Wilder, Idaho 83676 Public

1 that didn't show up tonight.

2 I have friends that didn't come tonight

3 because they think the decisions are already made. They

4 think there's no point in standing up because they don't

5 have a voice. Essentially, that's the essence of my

6 remarks.

7 COMMISSIONER SMITH: Okay, let's see if

8 there are questions.

9 COMMISSIONER SMITH: Mr. Shurtz.

10

11 CROSS-EXAMINATION

12

13 BY MR. SHURTZ:

14 Q Mr. Wilcox, how did you find out about the

15 hearings?

16 A I read it in the newspaper and I hear

17 things at the Post Office, that's where I work.

18 Q Okay, how much time or notice, when did you

19 find out about the meetings?

20 A My guess is about a week ago and I planned

21 on coming as soon as I knew that I had a chance to speak.

22 MR. SHURTZ: Okay, thank you.

23 THE WITNESS: Oh, Mr. Hansen.

24 COMMISSIONER HANSEN: I believe I do.

25

418

CSB REPORTING WILCOX (X)
Wilder, Idaho 83676 Public

1 EXAMINATION

2

3 BY COMMISSIONER HANSEN:

4 Q You mentioned, did I hear you correctly,

5 that you said you thought many stayed away because they

6 thought the decision had already been made?

7 A Yes.

8 Q And you even, did you kind of allude to

9 that, too, that you thought the decision had been made?

10 A No, that's not my feeling. I hope my voice

11 counts here. I think that a lot of the individual little

12 guys think that with things happening like Enron and

13 shenanigans being pulled higher up in big firms or big

14 places, we have no voice. You know, what would it matter

15 what we said, so that was the feeling of one neighbor,

16 it's already made up, their minds are made up.

17 Q Thank you very much.

18 A One more comment. My house is an energy

19 efficient home, supposedly when it was built and triple

20 windows and extra insulation and so forth, so I'm all

21 electric and you asked about the time of day metering. I

22 don't even qualify for that program because of our low

23 usage, but nevertheless, in other words, I'm off the

24 chart on the bottom end. I don't even get on the chart

25 how we use our electricity in our family, but

419

CSB REPORTING WILCOX (Com)
Wilder, Idaho 83676 Public

1 nevertheless, I'm still opposed to rates going up and to

2 me, this still is a rate increase and I'm opposed that

3 they be going up.

4 Q A follow-up question. I'm kind of curious,

5 in the winter months, what's the average kilowatt usage a

6 month you use, would you know?

7 A I didn't study it. I've got it right here,

8 I've got a power bill right here. My wife does the

9 accounting. 3,015, if I can read it, does that sound

10 like a possible number? Yeah, 3,200 kilowatts another

11 month. Well, there's a couple of examples of

12 kilowatt-hours.

13 COMMISSIONER HANSEN: Well, thank you very

14 much. We've had some that had total electric homes, this

15 was more in Idaho Power's district, but were using

16 7-9,000 kilowatts a month.

17

18 EXAMINATION

19

20 BY COMMISSIONER SMITH:

21 Q Well, yeah, I wanted to follow up on that,

22 how many square feet?

23 A A couple thousand.

24 Q Okay, and how many persons?

25 A Right now six.

420

CSB REPORTING WILCOX (Com)
Wilder, Idaho 83676 Public

1 Q And you use about 3,000 to 3,500?

2 A Uh-huh.

3 COMMISSIONER SMITH: I was trying to figure

4 out what people could possibly do to use seven, so I

5 guess you're to be congratulated. That's very

6 admirable. Thank you, sir, for your testimony.

7 THE WITNESS: Thank you.

8 (The witness left the stand.)

9 COMMISSIONER SMITH: Jeff Johnson.

10

11 JEFF JOHNSON,

12 appearing as a public witness, having been first duly

13 sworn, testified as follows:

14

15 THE WITNESS: Jeff Johnson, J-o-h-n-s-o-n,

16 1990 North 4000 West, Dayton, Idaho. I'm a residential

17 user. I'm a farmer. I'm also president of a small canal

18 company on the west side of this valley that has 220

19 irrigators. There's parts of this proposal that work

20 well for us and parts that we don't like. First, the

21 part we don't like is the fact that there is, in essence,

22 a rate increase, call it what you want, go through the

23 BPA credit, whatever you want, there's a rate increase

24 that we're asked to bear the burden of a Company loss and

25 any time a shareholder goes out and buys common stock in

421

CSB REPORTING JOHNSON
Wilder, Idaho 83676 Public

1 a company, they're taking the risk. They ought to be the

2 ones taking the loss.

3 I feel that buying stock is a risky

4 venture. Sometimes it works out, sometimes it doesn't.

5 Asking us as ratepayers to pick that up I don't think is

6 fair; however, the part of this proposal I do like as an

7 irrigation company on a canal, we cannot have any

8 interrupted service, so that forces all of our irrigators

9 to be on A rate or B rate and this tiered rate system

10 will be eliminated under this proposal which would

11 essentially mean a decrease in our irrigation pumping

12 costs which would work well for our shareholders and that

13 part I do support. I support anything we can do to help

14 the farmers reduce the pumping costs, but that is

15 essentially all I have to say.

16 COMMISSIONER SMITH: Thank you. Let's see

17 if there are questions.

18 Commissioner Hansen.

19

20 EXAMINATION

21

22 BY COMMISSIONER HANSEN:

23 Q I'm sorry, but I kind of missed on your

24 comment, could you repeat what you said about when you

25 referred that you thought the stockholders should be

422

CSB REPORTING JOHNSON (Com)
Wilder, Idaho 83676 Public

1 responsible for --

2 A Stockholders of Scottish Power. The

3 shareholders or whoever owns the Company, the common

4 shareholders, I feel they should be at risk, risk for

5 profit or risk for loss, and if bad things happen in a

6 company and things go wrong, I had a chopper burn down, I

7 have things go wrong in my business, things have to --

8 you either get insurance for that or you just bite the

9 bullet and go get a loan and you just make it up and I

10 feel the shareholders ought to take the risk there.

11 Q So you're saying with the Hunter plant

12 generation going down, generator going down, and the

13 Company having to go out on the market and buy expensive

14 power, you're saying that that should be borne by the

15 shareholders or stockholders?

16 A You bet I do. I had a chopper burn down

17 last fall. I had to go out and rent an expensive chopper

18 to go out and finish my contracts. That's a business

19 decision. That's a hit I had to take. I think that's a

20 hit that PacifiCorp or Scottish Power ought to take, too.

21 COMMISSIONER HANSEN: I thought that's what

22 you said. I just wanted to clarify it. Thank you.

23 COMMISSIONER SMITH: Thank you, sir, for

24 your testimony.

25 (The witness left the stand.)

423

CSB REPORTING JOHNSON (Com)
Wilder, Idaho 83676 Public

1 COMMISSIONER SMITH: Representative

2 Langford.

3

4 EULALIE T. LANGFORD,

5 appearing as a public witness, having been first duly

6 sworn, testified as follows:

7

8 EXAMINATION

9

10 BY MR. WOODBURY:

11 Q Representative, would you please state your

12 fall name?

13 A My full name is Eulalie Teichert Langford

14 and my last name is spelled L-a-n-g-f-o-r-d.

15 Q And how do you spell your first name?

16 A Eulalie, E-u-l-a-l-i-e.

17 Q And your address?

18 A My address is 333 North Second Street in

19 Montpelier.

20 Q Thank you.

21 A I have written comments here that I would

22 like to submit and I'll be reading from them and then I

23 would like to respectfully request that they be entered

24 as part of the proceedings of this meeting, but before I

25 begin those written comments, first of all, I want to

424

CSB REPORTING LANGFORD
Wilder, Idaho 83676 Public

1 thank the Commissioners for coming to Preston and

2 second,, I want to apologize for the small crowd.

3 I think that the building should be filled

4 and I think that the length of time from the time the

5 decision was made to hold this meeting until this date

6 was rather short and perhaps had there been more public

7 notice that there might have been a better crowd. I do

8 know that it's planting season and a great many people

9 are in the field and it's impossible for them to come at

10 this time. In a farming community, quite often that is

11 the case.

12 Mr. Fell made a comment that I would like

13 to respond to before I go into my written comments. He

14 indicated that there had not been any increases in costs

15 for a long time from Utah Power, and going back over the

16 history of things, many years ago the power companies or

17 the utility companies sued the State of Idaho in the

18 Supreme Court and the court ruled in favor of the utility

19 companies and it forced an adjustment in taxes. Taxes

20 had been like this: Here were the public utility taxes,

21 here were everybody else's taxes and the court ordered an

22 equalization of taxes and that took place back during the

23 1960s. The assessors became very unpopular at that time

24 because everyone was complaining because their taxes were

25 going up. Public utility taxes were doing this,

425

CSB REPORTING LANGFORD
Wilder, Idaho 83676 Public

1 everybody else's taxes were doing this until they were

2 equalized and the public utilities told us at that time

3 well, don't be concerned because as our taxes go down,

4 we'll be able to lower your rates.

5 About that time we built a total electric

6 home and the rate we paid at that time was nine mills.

7 We're now paying nearly nine cents, so the fact that the

8 public utilities' taxes went down did not include a

9 decrease in taxes for the ratepayers.

10 I'm an elected official and I'm here to

11 speak on behalf of my constituents and as an elected

12 official and a member of the Idaho Legislature, I oppose

13 any and every attempt to raise taxes on the basis that

14 higher taxes take money from the private sector where

15 jobs are created and stifle the economy. For the same

16 reason, I am opposed to the request by PacifiCorp for the

17 use of deferred accounting. This, if allowed, would have

18 a greater negative impact on the local economy than a

19 multi-million dollar tax increase. It would take

20 millions of dollars from the local economy and give it to

21 stockholders of Scottish Power, many of whom live outside

22 of the United States, and the reason that I say that this

23 would have a greater impact than the multi-million dollar

24 tax increase, if we in the legislature were to increase

25 taxes, it would be for the purpose of investing more

426

CSB REPORTING LANGFORD
Wilder, Idaho 83676 Public

1 money in the State of Idaho, in our schools, in our

2 roads, we would invest the money locally, so that

3 although we took money out of the pocket of the

4 taxpayers, we would put the money back into the State of

5 Idaho.

6 I'm opposed to doing that, but that's what

7 would happen, but if the Public Utilities Commission

8 allows this rate increase, it will take money out of the

9 people of Idaho and give it to stockholders who live in

10 foreign countries, so this is worse than a tax increase,

11 so you can see as a legislator how I feel that this would

12 have a very negative effect on the local economy.

13 Not only that, allowing the Power Company

14 to do deferred accounting would amount to a de facto rate

15 increase and would violate the terms set forth by

16 Scottish Power at the time of the merger when they

17 asserted through their newspaper ads that there would be

18 no rate increase for at least two years.

19 Perhaps it's necessary at this point to

20 define the word "no." According to my dictionary, no is

21 a negative response. When the Public Utilities

22 Commission conducted public hearings regarding the

23 proposed merger with PacifiCorp and Scottish Power, the

24 public answer was an overwhelming no, a negative

25 response. Yet, the merger occurred.

427

CSB REPORTING LANGFORD
Wilder, Idaho 83676 Public

1 Continuing the definition of no, my

2 dictionary says that no means not any. The newspaper ads

3 just referred to stated that there would be no rate

4 increase. That does not mean $38 million, it does not

5 mean $22 million, it means not any, not any rate increase

6 for at least two years. That is what Scottish Power

7 promised the ratepayers at the time of the merger.

8 Allow me to summarize my position by saying

9 that I am opposed to allowing the deferred accounting

10 requested by Utah Power/PacifiCorp/Scottish Power, one,

11 because it amounts to a rate increase and therefore

12 violates the promise made to the ratepayers by Scottish

13 Power at the time of the merger and two, because it takes

14 millions of dollars out of the local economy. The per

15 capita income of my constituents is among the lowest in

16 the State of Idaho. We cannot afford to have this drain

17 on the local economy.

18 Furthermore, my husband and I owned and

19 operated an electrical contracting business in southeast

20 Idaho for many years. We always honored every bid,

21 contract and agreement that we made with our customers.

22 Many times there were unforeseen expenses or

23 circumstances that drove up our costs, but we never

24 passed those costs on to our customers even though that

25 sometimes meant that we lost money on the job.

428

CSB REPORTING LANGFORD
Wilder, Idaho 83676 Public

1 It is time for the Public Utilities

2 Commission to realize that they are obligated to the

3 taxpayers of Idaho, the people who pay their salaries, to

4 require honest compliance on the part of all public

5 utilities under their jurisdiction with the agreements

6 and contracts entered into with the ratepayers.

7 It is time for Scottish Power and its

8 shareholders to recognize that businesses must honor

9 every agreement that they enter into with their

10 customers. This is the only honorable way to do

11 business.

12 Thank you for your time. Sincerely,

13 Eulalie Teichert Langford.

14 COMMISSIONER SMITH: Thank you,

15 Representative Langford. Let's see if there are any

16 questions.

17 THE WITNESS: Thank you.

18 COMMISSIONER SMITH: Mr. Shurtz. Oh, go

19 ahead, Mr. Shurtz.

20

21 CROSS-EXAMINATION

22

23 BY MR. SHURTZ:

24 Q Representative Langford, you mentioned

25 time, did you feel -- do you feel that the public was not

429

CSB REPORTING LANGFORD (X)
Wilder, Idaho 83676 Public

1 given enough time to really take in that this was going

2 on and get informed so that they could come and make an

3 informed --

4 A Yes, I do feel that the time was too short

5 and there wasn't sufficient notice.

6 Q How much time did you -- you know, you're a

7 representative, how much time did you have on this?

8 A I think I knew first about this meeting a

9 week ago yesterday and when I knew that, I then let the

10 newspapers know. I sent a letter to the editors of the

11 newspapers in this area to let them know that there would

12 be a public meeting.

13 Q Okay, also a question on your newspapers,

14 do most of them tend to be weekly newspapers?

15 A Yes, they are.

16 Q So in some cases, could you have missed, is

17 it possible to miss the date or miss the opportunity with

18 as much notice as you had, was it possible that you could

19 have --

20 A Yes, that is possible because -- and I

21 probably misspoke. It was probably two weeks ago

22 yesterday that I first heard because I immediately sent a

23 letter to the editor of the paper, but it was too late to

24 get it in that week's paper, so it appeared the following

25 week.

430

CSB REPORTING LANGFORD (X)
Wilder, Idaho 83676 Public

1 Q Did you see any other notice other than

2 just what you entered?

3 A I saw an article by Senator Geddes.

4 MR. SHURTZ: Okay, thank you.

5 COMMISSIONER SMITH: Thank you very much.

6 THE WITNESS: Thank you. May I submit

7 this?

8 COMMISSIONER SMITH: Please. Would you

9 give it to the court reporter?

10 THE WITNESS: Thank you.

11 (The witness left the stand.)

12 COMMISSIONER SMITH: Chris Barton.

13

14 CHRIS BARTON,

15 appearing as a public witness, having been first duly

16 sworn, testified as follows:

17

18 THE WITNESS: My name is Chris Barton,

19 B-a-r-t-o-n. I live at 825 North 800 East in Preston.

20 I'm just a homeowner and I manage a title company here in

21 Preston. My rates are regulated by the Department of

22 Insurance for what I charge. If I was to go to the

23 Department of Insurance and say, gee, last year was

24 really bad and so I want to charge more next year to make

25 up for last year, when they were done laughing, I think

431

CSB REPORTING BARTON
Wilder, Idaho 83676 Public

1 they would probably tell me no.

2 We're not here today to discuss what the

3 technicalities were of the agreement. We were told no

4 rate increase. We don't use the Clinton dictionary

5 here. No rate increase means no rate increase. Because

6 we get a rebate back from Bonneville credits, that

7 doesn't mean they can charge more and make up for that.

8 That's our money. To allow the rate increase to go

9 through at this time, which I feel it is, I feel is

10 wrong. It's not what they agreed to. It's not

11 honorable, it's not reasonable and it's not just. We had

12 a deal.

13 My employees, my family, we have electric

14 rates right now that we're paying. It's part of what all

15 of us look at as our budget. If those go up through no

16 fault of southeastern Idaho, that is an increase to us.

17 It's hurts us economically and it hurts our community and

18 it's just not right.

19 COMMISSIONER SMITH: Let's see if there are

20 questions.

21 COMMISSIONER SMITH: Mr. Shurtz.

22

23

24

25

432

CSB REPORTING BARTON
Wilder, Idaho 83676 Public

1 CROSS-EXAMINATION

2

3 BY MR. SHURTZ:

4 Q You mentioned -- you referred to -- are you

5 considering this a retro -- do you think this is a

6 retroactive increase?

7 A Absolutely.

8 MR. SHURTZ: Okay, that's the only question

9 I had.

10 COMMISSIONER SMITH: Thank you very much.

11 (The witness left the stand.)

12 COMMISSIONER SMITH: Senator Bob Geddes,

13 Jr.

14

15 ROBERT L. GEDDES, JR.,

16 appearing as a public witness, having been first duly

17 sworn, testified as follows:

18

19 EXAMINATION

20

21 BY MR. WOODBURY:

22 Q Senator Geddes, could you please state your

23 full name, spell your last name and give your address?

24 A My name is Robert L. Geddes, G-e-d-d-e-s.

25 I reside at 370 Mountain View Avenue, Soda Springs,

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1 Idaho.

2 Q Thank you. Madam Chairman and

3 Commissioners, thank you very much for scheduling this

4 hearing. I think it's great that the public has an

5 opportunity to provide input and I think it's very

6 valuable for the Commission to base their decision on the

7 input that you've heard both last night and tonight.

8 When I arrived home from Rigby last night

9 at a little after 1:00 this morning, I have a hard time

10 turning off my mind, and I got up this morning at

11 3:00 o'clock and I started to write testimony and when I

12 arrived at the meetings this afternoon, I read that and

13 it looked like I had written it at 3:00 o'clock in the

14 morning.

15 I've heard so much and I've thought so much

16 about this issue that I'm really kind of at a loss to

17 know what to say that you haven't already heard. Last

18 night, though, we had an opportunity to hear a letter

19 that was written by Senator Lee and let me give you a

20 little bit of background. During the merger process,

21 Senator Lee was the chairman of the Legislative

22 Electrical Restructuring Committee. He references

23 Representative Linford as being also a member of that

24 committee and involved in the negotiations that occurred

25 shortly before the merger was approved.

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1 Senator Lee and I were seatmates for four

2 years. I value him as a great friend and somebody that I

3 have total confidence and trust in. I called him this

4 morning. He's suffering from the final effects of cancer

5 and that's the reason that he couldn't attend last night,

6 but I thought it would be valuable just to share with the

7 public what he said in his letter. This letter is dated

8 May 6, 2002, and I apologize because this is already on

9 the record, but I think it is of value.

10 "Dear Madam Chairman: As a former state

11 Senator from Rexburg, Idaho, I was directly involved in

12 the Scottish Power negotiations that led to the PUC Order

13 freezing power rates until January 1st, 2002. It was

14 certainly understood that power rates were to be frozen

15 until January 1st, 2002, and that any extraordinary costs

16 from interest rate hikes, the merger, inflation, market

17 purchases, maintenance breakdowns or other factors were

18 to be absorbed entirely by Scottish Power.

19 During negotiations, these costs were never

20 discussed with me as being deferred costs to be assessed

21 against ratepayers, plus interest after the price

22 freeze. Assessing deferred charges, plus interest to the

23 ratepayers clearly cancels any benefit from a rate

24 freeze. There is no net economic benefit to ratepayers

25 from such a program. I find it hard to believe that the

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1 PUC is now considering passing the rate freeze costs on

2 to the ratepayers rather than requiring Scottish Power to

3 absorb them.

4 In addition, the PUC should refrain from

5 using the BPA exchange credit as an offset to these

6 deferred costs. The BPA exchange credit was a

7 hard-fought gain and should be used to benefit the

8 ratepayers, not Scottish Power. Sincerely, Robert R.

9 Lee."

10 You know, I've listened with interest as we

11 have talked about the need for the Power Company to honor

12 the contracts that were entered into, even to the

13 consequence of paying very, very high prices for spot

14 market power. As I've heard those discussions today and

15 yesterday, I've wondered why was that contract any more

16 sacred or any more credible than the contract that was

17 negotiated and agreed to in the final stages of the

18 merger process.

19 As I remember late in the process, there

20 was a slight inference that perhaps Idaho would not grant

21 the merger and at that point in time I was involved in

22 several meetings. I was entertained at dinner by the

23 chief executive officer of Scottish Power, as were many

24 other legislators. I attended meetings where power point

25 presentations were given to convince legislators, mayors,

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1 city councilmen, county commissioners and other public

2 elected officials of the benefits of a merger and what a

3 merger would provide in the form of better service, more

4 stable costs and even a guarantee that costs would not

5 increase.

6 Those commitments were made, an Order was

7 issued by the Public Utilities Commission requiring them

8 to hold those costs for two years. Verbal commitments

9 were made in other forms. We saw newspapers. I was even

10 interested to wonder why full page ads were purchased in

11 the Idaho Daily Statesman in Boise since Boise is not

12 their service territory, but these were the type of ads

13 that were placed in newspapers around the state, many in

14 papers where no ratepayers or customers of Scottish Power

15 would reside.

16 I think it was an effort to convince

17 perhaps the Public Utilities Staff, Public Utilities

18 Commissioners that this would be in the interest of Idaho

19 ratepayers. We've talked a little bit about some of the

20 devastating impacts of an energy crisis and we've talked

21 about how irrigators, for example, have been subsidized

22 by other ratepayers. Well, they were and perhaps they

23 are and perhaps they should be.

24 I saw a bumper sticker recently that said

25 if you like depending on foreign oil, wait until you have

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1 to depend on foreign food. The irrigators in this area

2 have already paid the price. Irrigators in this area, my

3 father and brother, for example, were curtailed three

4 days a week. That means their power was literally shut

5 off. They could not pump even if they wanted to pump and

6 wanted to pay. They suffered the loss of their

7 production and they suffered a loss because of the

8 economy. They suffered the same risk that a power

9 company suffers.

10 I've had hundreds of contacts with people.

11 I had a little lady who's a neighbor of mine call me in

12 March and she said, "Something is wrong." She said, "My

13 power bill is too low," and then when she started to read

14 the articles in the paper and get a little bit of

15 information, she called me in another panic and she says,

16 "Am I going to have to pay it back?" People are

17 concerned and I'm concerned for them.

18 I think this meeting was appropriate to be

19 held back in the early stages, perhaps even before the

20 negotiated settlement was scheduled so that public could

21 be involved in the process. That's what I see as lacking

22 in this process. As I look at the intervenors who

23 negotiated that settlement, I see that there was very

24 little public input, that the public really didn't have a

25 significant part to play.

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1 I was interested in Conley Ward's testimony

2 this afternoon where even a customer as large as Nu-West

3 let this fall through the crack and were not aware that

4 their rates would potentially increase to the tune of

5 $159,000 for two years. That surprised me.

6 I think that the public has not been

7 properly informed about the BPA credit and if they were,

8 we would have had a number of people here tonight who

9 would be fighting and testifying to maintain and preserve

10 that credit. I was a little surprised that the

11 negotiated settlement turned out the way it was. We

12 heard in presentations in the workshop that reasonable

13 and prudent costs incurred by the Power Company should be

14 reimbursed. I agree with that. We don't want the Power

15 Company to go out of business. We want them to be there

16 when we need them; however, if they could document those

17 costs as being reasonable and prudent, why did they

18 settle for only 51 percent? That seems like a very, very

19 poor business practice to me.

20 I'm concerned that it seems to be the

21 trend, at least since 1988, to look at piecemeal rate

22 processes and proceedings. I personally think that we

23 should have a rate case. I'm not sure that in the

24 economy that we're facing right now that a return on

25 investment of over 10 percent is justified. I don't

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1 think that we should see a rate increase. I think with

2 increased customer base that there would be a potential

3 that costs should in fact go down.

4 I would hope that the comments that are

5 heard tonight are taken into serious consideration as you

6 deliberate and as you decide what the outcome should be.

7 I've researched the Idaho statutes. I don't know that I

8 would like to be in your positions to determine what's

9 reasonable and fair. That's a hard thing to do, but I

10 think that that has to be the effort, but in order to do

11 that, we have to know what the increases were.

12 I had a caller call me and say, "What

13 benefit did it create for me as a customer of Scottish

14 Power or PacifiCorp to have them sponsor the 2002

15 Olympics and will those costs go into the rate case?" I

16 understand that that was a multi-million dollar

17 sponsorship. I'm not sure how those will be sorted out.

18 A question that I heard today in the

19 technical hearing was would we want last year to be the

20 test year for a rate case. I have no problem with that

21 because I have confidence in the Commission that even in

22 an extraordinary year that they could take that

23 information and normalize it and determine what is

24 prudent, what is reasonable, what is just and what is

25 fair, so I don't have any concerns at all about

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1 implementing a rate case. For us to go 12 years or

2 perhaps longer based on the economic changes that we've

3 seen recently, I think a rate case is justified.

4 With that, I would conclude my statement,

5 once again expressing my appreciation that you took the

6 time and effort to come to Preston and hold this

7 hearing.

8 COMMISSIONER SMITH: Thank you, Senator.

9 Let's see if there are any questions.

10 MR. WOODBURY: Thank you, Senator.

11 COMMISSIONER SMITH: Mr. Shurtz.

12

13 CROSS-EXAMINATION

14

15 BY MR. SHURTZ:

16 Q Again, Senator Geddes, what I've heard, as

17 others have testified, is lack of information on this.

18 How would you solve, in a perfect world, maybe, how would

19 you solve the question of lack of information? Do you

20 have any thoughts of, you know, what we could do as a

21 state or as a public to improve that?

22 A Well, Mr. Shurtz, I appreciate that

23 question and I don't have an easy answer for that. I do

24 know, however, that people tend to procrastinate and

25 there will be people here that if it's decided that the

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1 deferred costs should be awarded that I'll probably hear

2 from more of my constituents after their rates go up than

3 I did while the potential of them going down was still a

4 possibility.

5 Power issues are complex. I know just

6 enough to be dangerous. I've read the cases from

7 Wyoming, I've read the cases from Utah. I've looked at

8 some of the questions that those utility commissioners

9 have asked and some of the decisions that they have made

10 and, quite frankly, I would like to see this decision

11 delayed until some of those issues are sorted out, until

12 we know for sure why the Hunter plant went down.

13 I know where I work from an engineering

14 standpoint if something fails, the answer I don't know

15 why would not be an answer that would sell very well. I

16 would just further say that I have a hard time

17 understanding how a company can say the ratepayers should

18 pay the cost. The Company built it, the Company operated

19 it, the Company contracted to rebuild it, the Company

20 maintained it. It wasn't an act of God. It was a

21 mechanical failure. They have to take responsibility for

22 that.

23 Q So you're recommending that we take the

24 time to see what happens in the entire case before we

25 make a decision or, I should say, excuse me, Commission,

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1 you're recommending the Commission take the time to look

2 at all the aspects and all the litigation that happens in

3 the other states before we make a decision or before,

4 excuse me again, they make a decision?

5 A Well, I think in some of the other cases,

6 Wyoming especially, and I think they're the ones that

7 focused on the Hunter outage, they looked at that and

8 they said, boy, this is complex, we would rather not just

9 make a decision on the Hunter meltdown and I believe I

10 read that they encouraged the Company to come in with a

11 rate case so that they could look at the increases, the

12 decreases, the whole financial picture of the Company so

13 that they could make a better and more informed decision,

14 so yes, I think we should wait. I don't think it's in

15 the benefit of our customers to make a decision if some

16 of those other states can have a potential of sorting out

17 some of those major questions that remain unanswered.

18 MR. SHURTZ: Thank you.

19 COMMISSIONER SMITH: Commissioner Hansen.

20

21 EXAMINATION

22

23 BY COMMISSIONER HANSEN:

24 Q Senator Geddes, I've had to appear before

25 the committee over there at the State Affairs and you

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1 haven't let me off the hook, so I just had to come up

2 with a question or two.

3 A Life is tough wherever you sit, isn't it?

4 Q I just wanted to clarify a couple of

5 things. Did I hear you correctly in your testimony --

6 and you've been to the hearings and I noticed you have a

7 copy of all the filed testimony; is that correct?

8 A I do have copies of a lot of testimony that

9 I pulled off the Internet.

10 Q And did I hear you correctly, did you feel

11 that PacifiCorp has not properly documented the 25

12 million they're asking for?

13 A My statement, I believe, was that I don't

14 think that we should base a decision on just an instant

15 in time. I agree that the circumstances this summer or

16 last summer were extraordinary and unusual, but I think

17 we've gone for a long time without taking a total look at

18 the financial picture, where are the expenses, where are

19 the profits, where are the contracts and all of those

20 things that tie into the total economic outlook of

21 PacifiCorp so that we can decide what the rates should

22 be.

23 Q A question I had asked earlier, but from

24 what you said, I'd like to kind of add to that. Well,

25 first of all, what is your perception of the two-year

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1 rate moratorium?

2 A My perception is the same as Senator

3 Lee's. It was a commitment that was given voluntarily by

4 the Company. You know, if it would have been Utah Power

5 & Light, a company that existed for a long, long time and

6 they had extraordinary expenses, then I could understand

7 that we might have to step up and try to help them, but

8 when a company comes in and buys another company or

9 merges with another company, they made those offers not

10 necessarily because they thought that they were going to

11 be able to decrease the rates, but simply as an effort,

12 in my opinion, to sway the public so that they could get

13 public support, legislative support and Commissioner

14 support to make sure that the merger was approved.

15 Q If a company could profess that this rate

16 increase they're asking for, cost recovery of this

17 deferral, what they're asking for is fair and just, then

18 are you supportive of them going back and collecting on

19 that even though it occurred during the two-year rate

20 moratorium?

21 A Well, you know, I totally agree with what

22 the state law says, that the Company should receive

23 prudent and reasonable costs, plus a margin of profit. I

24 understand how difficult that is for three Commissioners

25 to sort out, but I don't think that you can sort that out

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1 if you don't look at the entire financial picture of the

2 Company; however, it seems to me that there's an

3 extraordinary circumstance here and whether we're playing

4 semantics with the words and it seems like we are to some

5 degree where we say that the Company would not have a

6 general rate increase, but I'm like most of these folks

7 here, if it costs me more to cover my power bill, it's

8 going to be an increase and I think that was the

9 commitment that the Company implied, that was the

10 commitment that Senator Lee and Senator Linford

11 understood.

12 Senator Lee told me he was still even after

13 that commitment was made not in favor of the merger, but

14 he did feel like it was the best they could negotiate to

15 provide price and rate stability for the consumers at

16 least for a short two-year period.

17 COMMISSIONER HANSEN: Thank you very much,

18 Senator.

19

20 EXAMINATION

21

22 BY COMMISSIONER SMITH:

23 Q Senator, I guess I just have one area and

24 that's because I don't want the record to -- the

25 impression to be left on the record that no one has

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1 looked at PacifiCorp's books since 1989 and so I wanted

2 to ask if you're aware that the Commission has periodic

3 and ongoing audits of the Company's books to determine

4 their level of earnings?

5 A Madam Chairman, I do understand that and it

6 was brought out in the testimony today during the

7 technical hearing and also in the workshop that there

8 have been many cost of service evaluations, but I don't

9 think that there has been a full evaluation of the entire

10 picture which, as I understand it, only occurs in a

11 general rate case.

12 Q Yes, but when our auditors go do these

13 audits, they audit as if they were in a rate case and

14 come down to the recommendation if they saw any

15 opportunity where they had a reasonable degree of

16 confidence that we could engage in a rate case and get a

17 rate reduction, that would be the recommendation. Of

18 course, the downside is that you never really know what

19 you'll get in a rate case and the concern is that you

20 might not end up with a decrease, you might end up with

21 an increase and it will look really bad that we initiated

22 a case that resulted in a rate increase, so I just wanted

23 to make you aware that our auditors audit the books of

24 all these utilities we regulate to make sure that they're

25 not within arrange that we can call them in and get their

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1 rates reduced.

2 A So did the benefits of sponsoring the

3 Olympics help me?

4 Q I believe that the benefits of sponsoring

5 the Olympics will never reach anyone's rates.

6 A So who paid for those?

7 Q The shareholders.

8 A Good.

9 Q Because the way a rate case works is you

10 have a test year and those expenses would be removed from

11 any test year, because your test year is adjusted for

12 known and measurable changes and one-time expenses that

13 happened would be out unless there was a deferral

14 mechanism to preserve the right to argue their recovery

15 and there's no such thing for those Olympic expenses and

16 also corporate image advertising and other things,

17 lobbying, none of that goes into rates.

18 A Good.

19 COMMISSIONER SMITH: Thank you for coming

20 tonight.

21 THE WITNESS: Thank you.

22 (The witness left the stand.)

23 COMMISSIONER SMITH: Brice Checketts.

24

25

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1 BRICE CHECKETTS,

2 appearing as a public witness, having been first duly

3 sworn, testified as follows:

4

5 EXAMINATION

6

7 BY MR. WOODBURY:

8 Q Sir, will you please state your name for

9 the record?

10 A Brice Checketts, C-h-e-c-k-e-t-t-s.

11 Q And your address?

12 A 2250 North Westside Highway.

13 COMMISSIONER SMITH: Is that Dayton?

14 THE WITNESS: Dayton, Idaho. Can I start?

15 Q BY MR. WOODBURY: Yes, you can.

16 A I'm glad to have the opportunity to be here

17 and respond. I didn't have much time for response. I

18 got a call at about 4:00 or 5:00 today and that's when I

19 heard about it. I have a dairy, probably one of the few

20 dairies left in this part of Idaho, so we use

21 electricity. We milk 24 hours a day, so we appreciate

22 your power. We can't get by without it.

23 I was late getting here for several

24 reasons. First of all, I was pouring concrete today for

25 a project on the barn and it's interesting that the

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1 cement bill now comes from a Irish company, yet we buy it

2 here in the State of Idaho, and so I suspect that a lot

3 of that goes back out of the country, too, which is

4 okay. The power bills, I guess some will go back to

5 shareholders somewhere else.

6 I'm not very good at public speaking, but I

7 haven't heard a person here, Commissioners, say that they

8 were in favor of this increase on our power, so I hope

9 you've listened closely. I don't think we need to have

10 the building clear full. I think you get the idea that

11 no one here accepts this or thinks it should be.

12 As much as I appreciate the power which

13 these folks generate and I need every day, I've still had

14 to go out even though the power comes most the time, but

15 I've had to go out and purchase a generator to operate my

16 dairy when the power stops coming from the Power

17 Company. I have a backup for everything on my farm so I

18 can be self-sufficient and I suspect maybe these

19 gentlemen here have backup generators for their power

20 plants, too, so we all suffer losses in our businesses.

21 Economic, how the economics of this affects

22 us here in the valley, I buy feed from many farmers here

23 in the valley. My feed costs are all represented through

24 their pumping costs. Their pumping costs represent as

25 much as 10 percent of their costs each year for growing a

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1 crop.

2 In our business, in the dairy business, I

3 know this may be boring to you, but in September we were

4 getting $16.00 for 100 pounds of milk. My last milk

5 check come, we're getting $11.30 for 100 pounds of milk

6 and I was just wondering where I could go back and

7 recover some of those losses. If I could go back and

8 hey, Power Company, you know, I spent -- oh, and I can't

9 break out all my expenses, I know that basically one

10 percent of my expenses go to power, which is a minute

11 amount, probably $30,000 a year goes to power, but I

12 need -- I still don't understand how they can come back

13 and say we need more because we had losses occur in those

14 two years.

15 I think everybody here related to

16 agriculture primarily has had terrible losses the last

17 few years in agriculture and who are they going to go

18 back on? I mean, business is business and we make our

19 own decisions and I think we should be able to keep what

20 we have separated. I don't think it's fair for the Power

21 Company to come back on us and say yeah, we need more

22 money because we had a loss. It's just not right.

23 I think that's about all I have to say, but

24 I can understand the gentleman over here has got a pretty

25 hard job to come and ask us. You're pretty brave to even

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1 show up and that's the end of my comments.

2 COMMISSIONER SMITH: Thank you,

3 Mr. Checketts. Let's see if there are questions.

4 MR. FELL: I don't have any.

5 THE WITNESS: It would make it easier if

6 there were some questions.

7 COMMISSIONER SMITH: Thank you.

8 MR. FELL: You did very well without them.

9 (The witness left the stand.)

10 COMMISSIONER SMITH: Wayne Tilley.

11

12 WAYNE S. TILLEY,

13 appearing as a public witness, having been first duly

14 sworn, testified as follows:

15

16 EXAMINATION

17

18 BY MR. WOODBURY:

19 Q Mr. Tilley, please state your full name and

20 spell your last name for the record.

21 A Wayne Sylvester Tilley, T-i-l-l-e-y.

22 Q And where do you live, sir?

23 A 510 North Main, Malad, Idaho.

24 Q Thank you.

25 A Thank you for giving us the opportunity to

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1 say a few words here. I will try and make this brief,

2 short and sweet. I am a residential customer. I took a

3 few notes here and so I'll take some information from my

4 notes. My personal -- I've had some personal experience

5 working with city councils, school boards and school

6 committees, and on the PacifiCorp request to recover the

7 power supply costs, the rate increase, it looks like to

8 me the rate increase would affect each of the customer

9 classes, especially the residential and irrigators.

10 The public believed that there would be no

11 rate increase and I base that on when I was involved with

12 this, everyone that I talked to was four to five years

13 there would be no rate increase and that was general

14 knowledge and in fact, there wasn't anybody that I know

15 of that believed anything different, so I think that was

16 common knowledge at the time.

17 Also, I'm a firm believer that a promise is

18 a promise, that a contract is a contract. It's called

19 integrity and when a person or a company breaks or tries

20 to break a promise or a contract, you can no longer trust

21 that person or company. I personally do not want to do

22 business with somebody I cannot trust, somebody that

23 would try to break a contract.

24 Another point would be that the reason I

25 think this room is not filled is I've talked to several

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1 of my neighbors and their feeling is that they have been

2 sold down the river. They didn't want to come. I talked

3 to my one neighbor and I said, "Well, did you read about

4 it in the paper?" "No." I said, "Well, go home and read

5 about it." He turned his back on me and walked away and

6 this person is a person that likes to talk, and I talked

7 to another neighbor, they felt like they had no choice in

8 the matter and that it was literally pushed on them.

9 This is their feelings of people that I've talked to.

10 Like I say, I was going to make this short

11 and sweet, but I want to go back to, and I have a firm

12 belief in this, a promise is a promise, a contract is a

13 contract and at this time I see no reason and certainly

14 not enough evidence that has been presented to me to show

15 any kind of rate increase at this time. Thank you.

16 COMMISSIONER SMITH: Let's see if there are

17 any questions.

18 MR. FELL: No questions.

19 MR. WOODBURY: No.

20 COMMISSIONER SMITH: Commissioner Hansen.

21 Oh, Mr. Tilley, Commissioner Hansen has a question for

22 you.

23

24

25

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1 EXAMINATION

2

3 BY COMMISSIONER HANSEN:

4 Q Just to follow up on your comment that a

5 promise is a promise and I guess, Mr. Tilley, wasn't the

6 promise not to raise the rates for two years and if that

7 was the promise, that was up on January the 1st, 2002, so

8 did they keep their promise?

9 A Okay, then I ask this question: How come

10 the general public believed that was four to five years

11 and it was published in the paper and I have, and I wish

12 I could find it, we received something saying that it

13 was, I believe, five years on it, but I could not find it

14 and that was general common knowledge. To me, if the

15 public generally believes something, that is important

16 even though they may say well, the actual contract is

17 only two years, but the perception of the public was four

18 to five years and I found no one at that time when this

19 was being done, I found no one at this time that believed

20 anything different, so this was general common knowledge.

21 Q If you were able, though, to now look at

22 the Order that was issued at that time approving the

23 merger and see in that Order that it said that the

24 moratorium was for two years, then if you saw that and

25 that was in the Order two years ago, then my question

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1 would be to you, by them not raising the rates for two

2 years until 2002, do you think they kept their promise if

3 that's what it said in the written Order that approved

4 the merger, that it would be -- the moratorium would be

5 for two years?

6 And my question, even though I know that

7 you may have read something in the paper, you may have

8 heard something different, but if that's what went out in

9 the Order that approved it, would you say, then, that

10 they kept their promise or do you think they still didn't

11 keep their promise?

12 A I still don't think they kept their

13 promise. I still think that there are problems there. I

14 don't see where there's enough evidence for a rate

15 increase, for going back. It's common sense to me,

16 they've had problems, but in any kind of form of

17 business, you can't go back and charge for something. If

18 you have problems on a farm, you have problems in a bank,

19 you have problems anywhere, you cannot go back and say

20 well, we were overcharged, so now we're going to pass it

21 on to you.

22 COMMISSIONER HANSEN: I see. Thank you

23 very much.

24 COMMISSIONER SMITH: Thank you for your

25 testimony.

456

CSB REPORTING TILLEY (Com)
Wilder, Idaho 83676 Public

1 (The witness left the stand.)

2 COMMISSIONER SMITH: That brings us to the

3 end of the list of persons who have signed up to

4 testify. At this time if there are any others in the

5 audience who wish to add to what we've heard tonight or

6 make a statement, you may come forward and do so now.

7 Okay.

8 MR. FELL: Madam Chairwoman?

9 COMMISSIONER SMITH: Mr. Fell.

10 MR. FELL: At the end of the evidentiary

11 hearings, we had a discussion about the treatment of

12 Nu-West.

13 COMMISSIONER SMITH: Yes.

14 MR. FELL: And we do not have anything in

15 the record that shows what the rate spread would be under

16 the various proposals that were presented to the

17 Commission.

18 COMMISSIONER SMITH: Yes, that's true.

19 MR. FELL: And I would propose to have the

20 Company prepare those and send them in, because the

21 reallocation of the rates is not intuitive in that. The

22 model works differently from how you might expect and so

23 those allocations based on the different proposals should

24 be simply presented.

25 COMMISSIONER SMITH: I agree, Mr. Fell, and

457

CSB REPORTING COLLOQUY
Wilder, Idaho 83676

1 I would request that you do so in the form of a

2 late-filed exhibit consecutively numbered from where we

3 left off this afternoon.

4 MR. FELL: We shall do that. Thank you.

5 COMMISSIONER SMITH: Do you have any idea

6 when those will be prepared and served on the parties?

7 MR. FELL: We can do that by Monday.

8 COMMISSIONER SMITH: Okay.

9 MR. FELL: And we'll do it as soon as

10 possible, if earlier.

11 COMMISSIONER SMITH: All right, I believe

12 that our proceeding tonight has reached its end. This is

13 the final hearing scheduled for this matter; however,

14 written comments will be accepted until Friday, May 10th

15 and the late-filed exhibits will arrive no later than

16 Monday, that would be the 13th, and then I believe we

17 also established the date of the 17th of May for

18 intervenor funding requests, so I believe, then, the

19 Commission upon the receipt of the exhibits next Monday

20 will consider the case or the record in this matter to be

21 closed and we'll deliberate and issue an order on this

22 matter as soon as possible.

23 With that, we want to thank all of you for

24 your interest and your attendance tonight. We appreciate

25 it very much. We're adjourned.

458

CSB REPORTING COLLOQUY
Wilder, Idaho 83676

1 (All exhibits previously marked for

2 identification were admitted into evidence.)

3 (The Hearing concluded at 9:15 p.m.)

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459

CSB REPORTING COLLOQUY
Wilder, Idaho 83676

1 AUTHENTICATION

2

3

4 This is to certify that the foregoing

5 proceedings held in the matter of the application of

6 PacifiCorp dba Utah Power & Light Company for approval of

7 changes to its electric service schedules, commencing at

8 7:30 p.m. on Monday, May 6, and continuing through May 7,

9 2002, at the Rigby Senior Citizens Center, 391 Community

10 Lane, Rigby, Idaho, and the Robinson Building, 200 West

11 200 North, Preston, Idaho, is a true and correct

12 transcript of said proceedings and the original thereof

13 for the file of the Commission.

14 Accuracy of all prefiled testimony as

15 originally submitted to the Reporter and incorporated

16 herein at the direction of the Commission is the sole

17 responsibility of the submitting parties.

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21
CONSTANCE S. BUCY
22 Certified Shorthand Reporter #187

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460

CSB REPORTING AUTHENTICATION
Wilder, Idaho 83676