HomeMy WebLinkAbout20090318Stipulation.pdfRECEI rit..
Morgan W. Richards, Jr.
ISB#1913
804 East Pennsylvania Lane
Boise, Idaho 83706
Telephone (208) 345-8371
2089 HAR 18 PM I: fI
Attorney for Intermountain Gas Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF INTERMOUNTAIN GAS COMPANY )
FOR APPROVAL TO PLACE INTO )
EFFECT A CHANGE IN ITS COMPOSITE )DEPRECIATION RATE )
CASE NO. INT-G-08-05
STIPULATION
This Stipulation ("Stipulation") is entered into by and among Intermountain Gas
Company ("Company" or "Intermountain") and the Staff of the Idaho Public Utilities
Commission ("Staff') also known collectively as the "Parties."
i. Background
1. On November 21,2008, Intermountain Gas Company filed an Application
as part of Case No. INT-G-08-05 requesting approval to change its composite
depreciation rate. Intermountain's currently effective depreciation rate of 3.35% (3.34%
when the accrual rates per Order 29975 are weighted by 09/30/07 assets) was
approved by the Commission in February 2006. The Commission directed the
Company to update its depreciation study and submit it to the Commission for review
no later than three years from entry of the February 2006 Order. Intermountain
subsequently retained a consultant to update its 2005 Depreciation Study. The
consultant's study indicated a decrease in the composite rate from 3.34% to 2.96% is
appropriate. The effect of the lower rate would be a decrease in the Company's annual
depreciation accrual by $1,462,205. The Company asked that its new composite
depreciation rate be effective January 1, 2009.
Stipulation - 1
2. Subsequent to the Company's initial filing in Case No. INT-G-08-05 the
Commission, by way of Order No. 30695, established an intervention deadline of
December 17, 2008. There were no interventions filed in this Case. The same Order
No. 30695 directed the Staff and Company, following the intervention deadline, to
"convene informal workshops to attempt to resolve Intermountain's request by
agreement."
3. On March 4, 2009, the Staff and the Company convened an informal
workshop to resolve any outstanding issues in the Case and stipulated to the following
Agreements.
II. AGREEMENTS
4. The Parties agree for the purposes of this Stipulation to exclude from
consideration in Case No. INT-G-08-05 the 2007 removal activity included as part of
account 376 (Mains). The agreed upon net salvage based on the exclusion of 2007
removals is negative 55%. The resulting depreciation accrual rate for account 376 is
2.69%.
5. The Parties further agree that an explanation of the account activity that
made up the removals during 2007 for account 376 has been provided to the Staff.
6. The Parties further agree that the 2007 removal activity for account 376
wil again be considered for inclusion at such time the Company files subsequent or
follow-on depreciation studies. The parties agree the next study wil be conducted on
the three-year cycle or as may be required by the Commission.
7. The Parties agree that, prior to the Company's next Application to modify
its depreciation rates, the Company will provide to the Staff the sub-accounts that make
up account 363 (LNG Plant). At such time this information is made known to the Staff,
the Parties will evaluate the appropriate listing of LNG Plant related accounts for future
separate and unique depreciation treatment.
8. The Parties further agree that, pursuant to the changes made as part of
the above sub-paragraph 4, a decrease in the composite rate from 3.34% to 2.90% is
appropriate. The effect of the lower rate would be a decrease in the Company's annual
Stipulation - 2
depreciation accrual by $1,683,747 (an additional decrease of $221,542 as compared
to the Company's original Application in Case No. INT-G-08-05). The applicable
information by account supporting this adjustment are shown in Attachment No. 1
9. The Parties agree that, subject to the Commission's final approval in the
matter, the Company should be authorized to record the decrease in the annual
depreciation on an account-by-account basis effective January 1, 2009 as shown on
Attachment NO.1.
Dated this i~itday of March 2009.
Intermountain Gas Company Idaho Public Utilties Commission Staff
By ¿.~ W , J4 ByA~
Morgan W. Richards Jr.
Attorney for Intermountain Gas Company
Weldon B. Stutzman
Deputy Attorney General
Stipulation - 3
ATTACHMENT NO.1
CASE NO. INT .G.08.5
INTERMOUNTAIN GAS COMPANY
(Revised Depreciation rates)
(2 pages)
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Attachment i
Case No. INT-G-Q8-5
Page i of 2
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