20100525Staff 71-106 to AVU.pdf

DONALD L. HOWELL, II
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 3366
£'11: í'f-r\.~..Vi.
26m"AY 25 AM 9: 59
KRISTINE A. SASSER
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
BAR NO. 6618
Street Address for Express Mail:
472 W. WASHINGTON
BOISE, IDAHO 83702-5918
Attorneys for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF A VISTA CORPORATION DBA A VISTA )
UTILITIES FOR THE AUTHORITY TO )
INCREASE ITS RATES AND CHARGES FOR )
ELECTRIC AND NATURAL GAS SERVICE )IN IDAHO. )
)
)
)
CASE NO. AVU-E-lO-l
AVU-G-I0-l
FOURTH PRODUCTION
REQUEST OF THE
COMMISSION STAFF
TO A VISTA CORPORATION
The Staff of the Idaho Public Utilities Commission, by and through its attorney of record,
Kristine A. Sasser, Deputy Attorney General, requests that Avista Corporation (Company;
A vista) provide the following documents and information on or before TUESDAY, JUNE 15,
2010.
FOURTH PRODUCTION REQUEST
TO AVISTA 1 MAY 25, 2010
This Production Request is to be considered as continuing, and A vista is requested to
provide, by way of supplementary responses, additional documents that it or any person acting
on its behalf may later obtain that wil augment the documents produced.
Please provide answers to each question, supporting workpapers that provide detail or are
the source of information used in calculations. The Company is reminded that responses
pursuant to Commission Rules of Procedure must include the name and phone number of the
person preparing the document, and the name, location and phone number of the record holder
and, if different, the witness who can sponsor the answer at hearing if need be. Reference
IDAPA 31.01.01.228.
In addition to the written copies provided as response to the questions, please provide all
Excel and electronic fies on CD with formulas activated.
REQUEST NO. 71: Please demonstrate that investors supply the working capital funds
for the utility to operate during the lag period (reference Staff Production Request No. 16).
REQUEST NO. 72: In Christie's testimony, page 4, lines 18-21, he says "Therefore, a
portion of cushion gas is estimated to be non-recoverable from the facility and that portion is
depreciated over the estimated life of the facility (account 352.3-Nonrecoverable natural gas)."
Please explain how this cushion gas is valued (i.e.-original cost over the life of the facilty).
REQUEST NO. 73: In Christie's testimony, page 7, lines 20-22, regarding the
assignment of Jackson Prairie (JP) capacity costs to Oregon customers vs. Idaho customers, he
says "This proportion was based on forecasted jurisdictional sales volumes for the Nov. 2008-
Oct. 2009 period." Please explain why you used a sales volume forecast associated with a 2007
deliverabilty expansion (FERC docket CP06-412-000), instead of using actual sales volumes or
a more recent forecast. In your response, please provide an executable electronic comparison of
forecasted vs. actual sales volumes for the Nov. 2008 - Oct. 2009 period.
REQUEST NO. 74: In Christie's testimony, page 10, lines 10-15, regarding the
estimated value of the seasonal Sumas price spread, he says "Page 1, Schedule 1 of Exhibit No.
11 shows the present monthly forward prices at Sumas over the next three years. These forward
FOURTH PRODUCTION REQUEST
TO AVISTA 2 MAY 25, 2010
prices reflect the purchase price today for gas delivered during that future month. As shown, the
average seasonal price spread over the next three years is $1.79 Dth." Please explain:
a. Why you decided to use monthly forward prices over the next three years for
estimating the value of the seasonal price spread.
b. Why you did not weight the seasonal price spread (including and excluding
transportation) of all the basins used to supply JP storage.
c. Why you did not use a similar weighting factor to figure 1.3 in the recent IRP, or
in your short term gas procurement planning, to incorporate the spread (risk
margin) built into forward market prices.
d. Why you did not use historical seasonal prices for estimating the value of the
seasonal Sumas price spread.
REQUEST NO. 75: Please provide all of the executable electronic workpapers used in
Christie's testimony to estimate the value of the seasonal Sumas price spread shown on Exhibit
No. 11, Schedule 1, page 1.
REQUEST NO. 76: In Christie's testimony, page 12, lines 11-15, regarding the
operational benefits storage provides, he says "This flexibilty is critical to maintaining mandated
tolerances on pipelines and allows for active supply management during pipeline entitlements
and operational flow orders. This level of management reduces the likelihood of incuring
pipeline penalties." In executable electronic format, please provide the number, date, and
duration of entitlements and operational flow orders over the last 10 years. As par of your
response, explain how storage has been utilzed in these situations to avoid pipeline penalties.
REQUEST NO. 77: In Christie's testimony, page 15, lines 15-20, regarding how the
cost of injections during the pro forma period are estimated, he says "Injections into storage are
priced at the 'forward' gas price for that month, i.e., the price at which gas can be purchased at
today for delivery in a future month. In estimating the cost of injections during the pro forma
period, the Company used a 60-day average of forward prices from November 5, 2009 to
February 1,2010." Please explain why a 60-day average of forward prices was used to
FOURTH PRODUCTION REQUEST
TO AVISTA 3 MAY 25, 2010
determine the cost of injections instead of a 30-day average, and why November 5, 2009 to
Februar 1, 2010 was selected instead of some earlier timeframe when the majority of injections
are actually taking place (i.e.-summer or early fall).
REQUEST NO. 78: In Knox's testimony, page 8, lines 14-17, she says "The natural gas
weather adjustment is developed from a regression analysis of ten years of biled usage-per-
customer and biling period heating degree-day data." Please explain why a regression analysis
of ten years was used. As part of your response, please include an executable electronic copy of
your regression analysis.
REQUEST NO. 79: In Ehrbar's testimony, page 5, lines 4-7, regarding why the
Company is proposing an increase of such magnitude in the customerlbasic charge, he says "A
significant portion of the Company's costs are fixed and do not vary with customer usage. These
costs include distribution plant and operating costs to provide reliable service to customers."
(Emphasis added). He then says this again on page 32, lines 20-23. Given the recent outage on
May 3rd that left 18,000 customers without power throughout the Eastern Washington and North
Idaho service territory, please explain what the Company's criteria is for determining the
performance reliabilty it provides to customers. Please include as part of your response an
explanation of:
a. How the Company quantifiably measures its reliabilty performance.
b. How the Company incorporates the measurement parameters included in the
"IEEE Guide for Electric Power Distribution Reliabilty" to make distribution
plant and operating investment decisions.
c. How the Company uses its Outage Management System (OMS) to determine
what, where and how much improvement is needed.
d. How the Company measures circuit performance, determines its tree trimming
cycle, determines outage locations, dispatches crews to trouble areas, and
identifies outages as uncontrollable events.
e. The causes of momentar and sustained outages over the last 5 years.
FOURTH PRODUCTION REQUEST
TO AVISTA 4 MAY 25, 2010
REQUEST NO. 80: In Ehrbar's testimony, page 31, lines 4-8, regarding the proposed
changes to Schedule 111, he says "The present rates for Schedules 101 and 1 1 1 provide guidance
for customer placement: customers who generally use less than 200 therms/month should be
placed on Schedule 101, customers who consistently use over 200 therms per month should be
placed on Schedule 1 i I." Given guidance for customer placement is 200 therms, please explain
why the "present (breakeven) relationship between the schedules" continues to be 192 therms. If
the Company has apprehensions because of customers shifting, please explain why it has not
designated Schedule 101 as "residential" or made slight moves toward 200 therms as the
breakeven point.
REQUEST NO. 81: Please provide an executable electronic workpaper summarizing by
year, over the last five years, the customers who have transferred between Schedule 111 and
Schedule 101. As par of this summary, please provide the annual median monthly usage and the
average monthly usage of these customers.
REQUEST NO. 82: In Ehrbar's testimony, page 32, lines 9-15, regarding the
Company's proposal to change Schedule 150 concurrent with the rate case, he says "The rates
contained in Purchase Gas Cost Adjustment Schedule 150 have been incorporated into the
present and proposed rates." He then goes on to say "present rates under the schedule have been
zeroed-out and included in the Company's proposed general service tariffs." Please provide a
detailed explanation and all supporting executable electronic analyses used to support the
Company's decision to zero-out Schedule 150 and include it in base rates. In your response,
please include an explanation of how gas costs in base rates wil change, and how customers wil
benefit.
REQUEST NO. 83: In Ehrbar's testimony, page 36, lines 8-14, regarding why
increasing the basic charge won't send the wrong price signal through the energy rates, he says
"one might argue that a lower basic charge results in higher commodity prices and a stronger
price signal related to volume usage. However, sending a price signal to customers through a
residential rate design that contains a two tier increasing block rate for electric (natural gas has
FOURTH PRODUCTION REQUEST
TO AVISTA 5 MAY 25, 2010
just one volumetric rate) was developed just for that reason." Please explain how the proposal to
increase residential natural gas customers' basic charge by nearly 69% and maintaining one
volumetric rate where the increase is approximately 6%, preserves the "ability to provide price
signals for conservation purposes."
REQUEST NO. 84: In Ehrbar's testimony, page 37, lines13-17, regarding the
Company's proposal having adequate price signals, he says "For natural gas, the Company
included several forecasts in its 2009 Integrated Resource Plan which, for the most par, all show
forecasted natural gas prices at Henry Hub over the next ten years being lower than Avista's
retail rates." Please explain the forecasts in Figure 1.3 of the 2009 IRP. Also include an
explanation of how the NYMEX weightings were derived and applied.
REQUEST NO. 85: In Ehrbar's testimony, page 42, lines 8-13, he explains that
"traditional thinking might lead one to believe that a low income electric customer would tend to
be a low user of electricity," and then he goes on to say "Although the Company has not
conducted a demographic survey of its customers in recent years, the limited data that we do
have would suggest that just the opposite is true." Please provide the limited data you have in
executable electronic format suggesting that "just the opposite is true." In your response, please
explain why you have not completed a demographic surveyor analysis to confirm your
assumption.
REQUEST NO. 86: In Ehrbar's testimony, page 42, lines 16-22, he says "many low
income customers, I believe, tend to stil use electricity for space and water heating. These
customers, in my view, tend to live in aparments (which in Avista's service territory
predominantly have electric space and water heat), live in areas where natural gas is not
available, or live in areas with natural gas, but cannot afford to convert." Please provide all the
data in electronic executable format that leads you to believe these assumptions are true.
REQUEST NO. 87: In Ehrbar's testimony, page 43, lines 13-17, regarding the
implications of the Company's proposed rate design on limited income natual gas customers, he
FOURTH PRODUCTION REQUEST
TO AVISTA 6 MAY 25, 2010
says "Data gathered as par of the review of the Company's Washington natural gas Decoupling
Mechanism showed that limited income natural gas customers tend to use slightly less natural
gas (58 therms per month) than the traditional residential customer (63 therms per month)."
Please provide all the data "gathered as par of the review of the Company's Washington natural
gas Decoupling Mechanism," specifically data comparing income levels and demographics of
customers to natural gas usages.
REQUEST NO. 88: In Ehrbar's testimony, pages 38-44, he prepares several tables
ilustrating the impact the proposed rate design changes would have on customers, please provide
these tables in executable electronic format. As par of your response, please include all the data
used to determine low, average, and high usage levels.
REQUEST NO. 89: In the case of a customer receiving both electric and gas service,
please provide a detailed explanation summarizing all of the economic efficiencies gained by
providing electric and natural gas service. In your response, please provide an executable
electronic summary ilustrating each class's annual percentage of Idaho dual service customers
over the last 10 years.
REQUEST NO. 90: Please explain how you have determined the Schedule 111 four-tier
declining block-rate differentials. In your response, explain why these differentials have been
chosen. Include all executable electronic workpapers associated with these decisions (e.g. - bil
frequency study, load factor study, etc.).
REQUEST NO. 91: In Case AVU-G-09-01, the Company changed from a 25-year to a
30-year average for determining "normal" heating and cooling degree days reported for each
month. Since the case settled without a decision regarding the change, please provide a detailed
explanation and all supporting executable electronically formatted analysis (with the exception
of the 2007 & 2008 "Factors WC_1209_w_30 yr rollng") ilustrating:
a. Why a 30-year average more accurately captures "normal" heating and cooling
degree days than a 25-year average. If less variability is the determining factor,
FOURTH PRODUCTION REQUEST
TO AVISTA 7 MAY 25, 2010
include an explanation of why this should be the determining factor, even though
it is important to capture recent climactic cycles and the Company continues to
fie frequent rate cases.
b. A comparison ofthe change from a 25-year to a 30-year average for normal
degree days. In your response include all comparisons ilustrating how the final
Revenue Requirement is different with respect to the change from a 25-year to a
30-year average for normal degree days.
REQUEST NO. 92: Please provide a comparative explanation and analysis ilustrating
the Company's interpretation of the similarities and differences between the services Advantage
IQ provides vs. A vista Utilities DSM department. In your response, please explain how these
similarities and differences might evolve over time.
REQUEST NO. 93: Please provide copies of the planed Coyote Spring 2 Inventory
Audit and the planned Green House Gas Inventory Audit (reference Avista's response to Audit
Request No.9) when they are available. Staff understands that these audits may be completed in
the 3rd or 4th quarter of2010.
REQUEST NO. 94: Please provide a detailed discussion and the underlying
documentation related to the decision to conduct a Coyote Springs 2 Inventory Audit.
REQUEST NO. 95: Please provide copies of the "Unusual Journal Entry Analysis"
performed quarterly for 2008,2009, and 2010 to date.
REQUEST NO. 96: Please provide a list, in Excel format with formulas activated, of all
charges to the following accounts for 2009. The list should include FERC account, FERC
subaccount, date, vendor, amount, a brief description, and some method of tracking, i.e. voucher
number or invoice number.
598000
813000
824000
DISTRIBUTION MAINT-MISC
OTHER EXPENSE
NAT GAS STORAGE-OTHER EXPENSES
FOURTH PRODUCTION REQUEST
TO AVISTA 8 MAY 25, 2010
837000
874000
879000
880000
887000
889000
892000
894000
903000
905000
908000
909000
910000
912000
913000
916000
921000
922000
923000
924000
925100
925200
925300
928000
930100
930200
935000
NA T GAS STRGE MAINT -OTHER EQUIP
DIST EXPENSES OPER-MAINS&SVCS EXP
DIST EXP OPER-CUST INSTALL EXP
DIST EXP OPER-OTHER EXPENSES
DIST EXP MAINT-MAINS
DIST EXP MAINT-MEA & REG STAT EQP GEN
DIST EXP MAINT-SERVICES
MAINT OF OTHER DISTRIBUTION EQUIPMENT
CUST ACCOUNTS EXP-RECORDS & COLLECT
MISC CUST AC EX
CUST SVC & INFO EXP-CUST ASST EXP
INFO AND INSTRUCT ADVERT EXP
CUST SVC & INFO EXP-MISC
SALES EXPENSES-DEMONSTRATING
ADVERTISING EXPENSE
MISC SALES EXPENSES
OFFICE SUPPLIES & EXPENSES
ADMINISTRA TIVE EXPENSE TRANSFERRD
OUTSIDE SERVICES EMPLOYED
PROPERTY INSURANCE
INJURIES & DAMAGES NON PB
INJURIES & DAMAGES PB
INJURIES & DAMAGES PB CLEARIG
REGULATORY COMMISSION EXPENSES
GENERAL ADVERTISING EXPENSE
MISC GENERAL EXPENSE
MAINT OF STRUCTURE & IMPROVEMENTS
REQUEST NO. 97: Please provide a list of all outside legal expenses incured by the
Company during 2009 and 2010 to date, with a brief description of the services performed. If
services were performed in support of a docketed state or federal court or regulatory action,
please identify the case name, case number and jurisdiction.
REQUEST NO. 98: Please provide a list, in Excel format, of all charges to the Idaho
DSM rider accounts for natural gas and electricity for 2008 and 2009. Please include date,
vendor, amount, voucher number, and a brief description of the expense. Please separate the
expenses by DSM program offering and by year.
FOURTH PRODUCTION REQUEST
TO AVISTA 9 MAY 25, 2010
REQUEST NO. 99: Please provide copies of the 2009 and 2010 actuarial reports for the
Company's pension plan.
REQUEST NO. 100: Please identify any costs associated with the Rearden Project
referenced in Company witness Storro' s testimony that are included in the test year. Please
identify all costs included by FERC account.
REQUEST NO. 101: Company witness Storro, page 11, states, "In addition, the
Company continues to place met towers at other locations within its service terrtory to collect
wind data and explore other sites for potential development." Please identify all costs associated
with the placement of the met towers that are included in the test year. Please identify all costs
included by FERC account.
REQUEST NO. 102: Please provide a detailed description of the Clark Fork PM&E
measures and projects for 2009 and those planned and/or implemented for 2010. Please provide
a list, in Excel format, of all charges, by FERC account, for the 2009 PM&E measures and
projects. The list should include the date, vendor, amount, a brief description, and some method
of tracking, i. e. voucher number or invoice number.
REQUEST NO. 103: For the Clark Fork Project, please provide a schedule showing the
various PM&E measures and projects, by calendar year, for thePM&E's, including the cost for
each project for the years 2002 through 2008.
REQUEST NO. 104: Please describe how actual Clark Fork Project PME expenditures
from 2002 through 2009 compare to the expenditures originally specified for the period under
the current project license.
REQUEST NO. 105: Please provide a narrative description of how the collaborative
group decides which projects to approve, and how much to expend per project.
FOURTH PRODUCTION REQUEST
TO AVISTA 10 MAY 25, 2010
REQUEST No. 106: Please provide Staff access to any and all reports describing the
Clark Fork PM&E projects that have been planned or implemented.
~
Dated at Boise, Idaho, this ~5day of May 2010.
rlcn
~rd.~
Kristine A. Sasser
Deputy Attorney General
Technical Staff: Patricia Harms171
Matt Elam172-92
Kathy Stockton/93-1 06
i :umisc: prodreq/avue ~ 10. i ksphmekls prod req4.doc
FOURTH PRODUCTION REQUEST
TO AVISTA 11 MAY 25, 2010
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 25TH DAY OF MAY 2010,
SERVED THE FOREGOING FOURTH PRODUCTION REQUEST OF THE
COMMISSION STAFF TO AVISTA, IN CASE NOS. AVU-E-I0-0l AVU-G-IO-Ol, BY
E-MAILING AND MAILING A COPY THEREOF, POSTAGE PREPAID, TO THE
FOLLOWING:
DAVID J MEYER
VP & CHIEF COUNSEL
A VIST A CORPORATION
PO BOX 3727
SPOKANE WA 99220-3727
E-MAIL: david.meyerCfavistacorp.com
PETER J RICHARDSON
GREG M ADAMS
RICHARDSON & O'LEARY
515 N 27TH ST
BOISE ID 83702
E-MAIL: peterCfrichardsonandoleary.com
gregCfrichardsonandoleary.com
DEAN J MILLER
MCDEVITT & MILLER LLP
PO BOX 2564
BOISE ID 83701
E-MAIL: joeCfmcdevitt-miler.com
ROWENA PINEDA
ID COMMUNITY ACTION
NETWORK
3450 HILL ROAD
BOISE ID 83703
E-MAIL: RowenaCfidahocan.org
BRAD MPURDY
ATTORNEY AT LAW
2019N17THST
BOISE ID 83702
E-MAIL: bmpurdyCfhotmail.com
KEN MILLER
SNAKE RIVER ALLIANCE
PO BOX 1731
BOISE ID 83701
E-MAIL: kmilerCfsnakeriverallance.org
KELL YO NORWOOD
VP STATE & FED REG
A VIST A CORPORATION
PO BOX 3727
SPOKANE WA 99220-3727
E-MAIL: kelly.norwoodCfavistacorp.com
HOWARD RAY
CLEARWATER PAPER CORP
803 MILL ROAD
PO BOX 1126
LEWISTON ID 83501-1126
E-MAIL: howard.rayCfclearaterpaper.com
LARRY CROWLEY
ENERGY STRATEGIES INSTITUTE
5549 S CLIFFS EDGE AVE
BOISE ID 83716
E-MAIL: crowleylaCfaol.com
LEEANNHALL
3518 S EDMUNDS ST
SEATTLE WA 98118
BENJAMIN J OTTO
ID CONSERVATION LEAGUE
PO BOX 844
BOISE ID 83701
E-MAIL: bottoCfidahoconservation.org
ROB PLUID PRESIDENT
NORTH IDAHO ENERGY LOGS
PO BOX 571
MOYIE SPRINGS ID 83845
E-MAIL: robpluidCfgmail.com
CLARK FAIRCHILD
VICE PRESIDENT
NORTH IDAHO ENERGY LOGS
PO BOX 571
MOYIE SPRINGS ID 83845
E-MAIL: energylogsCfgmaiL.com
TOM OXFORD
SECRETARY TREASURER
NORTH IDAHO ENERGY LOGS
E-MAIL: oxfordCfmeadowcrk.com
(ELECTRONIC SERVICE ONLY)
-.~SECRET Y