20070709_1974.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
CO MMISSI 0 NER SMITH
COMMISSIONER REDFORD
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM:NEIL PRICE
DATE:JUNE 26, 2007
SUBJECT:APPLICATION FOR APPROVAL OF A SERVICE TERRITORY
AGREEMENT FILED BY VISTA UTILITIES AND NORTHERN
LIGHTS, CASE NO. A VU-07-
On June 15 , 2007, Avista Corporation dba Avista Utilities filed an Application
seeking the Commission s approval of a contract between Avista and Northern Lights, Inc.
Northern Lights ) to allocate service territories and future consumers. Northern Lights is an
electric cooperative operating in northern Idaho. The parties have entered into a "Customer
Allocation Agreement" which is last dated May 19, 2007 and attached to A vista s Application.
The Agreement was executed pursuant to the provisions of the Electric Supplier Stabilization
Act ("ESSA"), specifically Idaho Code 9 61-333(1).
THE APPLICATION
Avista and Northern Lights propose to allocate service territory in a 13-10t residential
subdivision development known as Lakewood Estates in Sandpoint, Idaho. A vista customer
Alpine Property Development, Inc. ("Developer ) is developing the subdivision. Both electric
suppliers have existing facilities that can serve the 13-10t subdivision. The parties recite in their
Agreement that Northern Lights already serves two existing homes in the development and will
serve the remaining lots because its facilities are in closer proximity to the development.
Agreement at 1. A plat of the subdivision is attached to the Agreement.
The parties assert that allowing Northern Lights to provide electric service to the
subdivision will avoid duplication of facilities, avoid dispute between the parties and provide
consumers the best possible service. For the aforementioned reasons, the parties agree that it is
in the best interest of the customer "to have a single source-utility provider.Id. The Agreement
DECISION MEMORANDUM
recognizes that A vista does not give up "its rights to serve future phases of the Development or
adjoining plats thereto, and the Agreement may not be used to" determine which supplier may
serve other new customers. Id. at 1 , ~ 3.
The owner-developer of Alpine Property Development, Richard Lewis, has endorsed
the Agreement. The Developer agrees to comply and be bound by the Agreement. Pursuant to
their Agreement, the parties recommend that the Application be processed under Modified
Procedure. Finally, the parties acknowledge that the Agreement is subject to the Commission
approval. Id. at 1 , ~ 4.
THE ESSA
Idaho Code 9 61-333(1) provides that electric suppliers may contract for the purpose
of "allocating territories, consumers, and future consumers. . . and designating which territories
and consumers are to be served by which contracting electric supplier." Under the ESSA, both
Avista and Northern Lights are defined as electric suppliers. Idaho Code 9 61-332A(4). After
notice and opportunity for hearing, the Commission may approve agreements allocating service
territories and customers between electric suppliers only upon finding that the allocation is in
conformance with the purposes of the ESSA. Idaho Code 9 61-333A(1). As set out in Idaho
Code 9 61-332(2), the purposes of the ESSA are to: (1) discourage duplication of facilities; (2)
prohibit "pirating" of consumers; (3) stabilize service territories and consumers; and (4) promote
harmony between electric suppliers.
STAFF RECOMMENDATION
In accordance with the agreement between the parties and the consent of the affected
Developer, Staff recommends that this Application be processed under Modified Procedure.
CO MMISSI 0 N D ECISI ON
Does the Commission concur that this mater should be processed under Modified
Procedure?
/I "'--
/f\)
Neil Price
M:A VU-O7-
DECISION MEMORANDUM