HomeMy WebLinkAboutSection I 2019 Annual Report.pdf
ANNUAL REPORT
2019
IDAHO PUBLIC UTILITIES COMMISSION
11331 W. Chinden Blvd., Building 8
Suite 201-A Boise, ID 83714
PO Box 83720 83720-0074
208.334.0300
www.puc.idaho.gov
Idaho Public Utilities Commission
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Table of Contents
COMMISSIONERS ................................................................................... 8
FINANCIAL SUMMARY FUND 0229* ........................................................... 11
Fiscal Years 2015 – 2019 ........................................................................ 11
COMMISSION STRUCTURE AND OPERATIONS ............................................... 12
Administration ................................................................................... 14
Legal .............................................................................................. 15
Utilities Division ................................................................................. 15
Railroad and Pipeline Safety Section ......................................................... 16
WHY CAN’T YOU JUST TELL THEM NO? ..................................................... 17
ELECTRIC ......................................................................................... 18
Avista ............................................................................................. 19
Idaho Power ...................................................................................... 23
Rocky Mountain Power ......................................................................... 27
WATER…………………………………………………………………………………………………………………………….29
TELECOMMUNICATION…………………………………………………………………………………………………..31
NATURAL GAS .................................................................................... 34
CONSUMER ASSISTANCE ........................................................................ 38
REGULATING IDAHO’S RAILROADS ........................................................... 39
REGULATING IDAHO’S PIPELINES ............................................................. 40
Idaho Public Utilities Commission
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Idaho Public Utilities Commission
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Idaho Public Utilities Commission
Contact us: 208-334-0300 www.puc.idaho.gov
Commission Secretary 334-0338
Public Information 334-0339
Utilities Division 354-0367
Legal Division 334-0324
Rail Section and Pipeline Safety 334-0330
Consumer Assistance Section 334-0369
Outside Boise, Toll-Free Consumer Assistance 1-800-432-0369
Voice: 1-800-377-3529
Text Telephone: 1-800-368-6185
TRS Information: 1-800-368-6185
This report and all the links inside can be accessed online from the Commission’s Website at www.puc.idaho.gov. Click on “File Room,” in the upper-left-hand-
corner and then on “IPUC 2019 Annual Report.”
Front cover photograph courtesy of Idaho Power Company. Langley Gulch Plant in New Plymouth, Idaho.
Idaho Public Utilities Commission
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Idaho Public Utilities Commission
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November 27, 2019
The Honorable Brad Little
Governor of Idaho
Statehouse
Boise, ID 83720-0034
Dear Governor Little:
It is our distinct pleasure to submit to you, in accordance with Idaho Code §61-214, the Idaho Public Utilities
Commission 2019 Annual Report. This report is a detailed description of the most significant cases, decisions
and other activities during 2019. The financial report on Page 10 is a summary of the commission’s budget
through the conclusion of Fiscal Year 2019, which ended June 30, 2019.
It has been a privilege and honor serving the people of Idaho this past year.
Sincerely,
Paul Kjellander
President, Idaho Public Utilities Commission
Kristine Raper
Commissioner
Eric Anderson
Commissioner
Idaho Public Utilities Commission
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Idaho Public Utilities Commission
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Idaho Public Utilities Commission
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COMMISSIONERS
P A U L K J E L L A N D E R
Commissioner Paul Kjellander serves as President of the Idaho Public Utilities
Commission, having been appointed to his current six-year term in 2017 by
Gov. C.L. “Butch” Otter. His term expires in 2023.
It is Commissioner Kjellander’s second term in his second stint on the
Commission, having previously served from January 1999 until October 2007.
Gov. C.L. “Butch” Otter reappointed Kjellander in April 2011, following his
service as administrator of the newly created state Office of Energy Resources
(OER).
A member of the National Association of Regulatory Utility Commissioners’
(NARUC) board of directors and executive committee, Kjellander serves as First
Vice President of the association and is a member of the subcommittee on
Education and Research. He previously served on NARUC’s Committee on
Consumer Affairs and its Electricity Committee and is past Chair of the Committee on Telecommunications.
Kjellander serves as President of the National Council on Electricity Policy, which is funded by the US
Department of Energy and managed by NARUC. He is a member of the Federal Communications Commission’s
706 Joint Board and has served as chairman of the FCC’s Federal-State Joint Board on Jurisdictional Separations.
During his time at OER, which is now known as the Office of Energy and Mineral Resources, Kjellander created
an aggressive energy efficiency program funded through the federal American Recovery and Reinvestment Act
of 2009. He also served on the board of the National Association of State Energy Officials.
Before joining the Commission in 1999, Kjellander was elected to three terms in the Idaho House of
Representatives, where he served from 1994-1999. As a legislator, Kjellander served on a number of
committees, including the House State Affairs, Judiciary and Rules, Ways and Means, Local Government and
Transportation. During his final term in office, Kjellander was elected chairman of the House Majority Caucus.
Prior to his legislative service, Kjellander was director of Boise State University’s College of Applied Technology
Distance Learning, where he earned tenured faculty status and served as program head of broadcast
technology, station manager of BSU Radio Network, director of the Special Projects Unit for BSU Radio and as
BSU Radio’s director of News and Public Affairs.
Commissioner Kjellander earned undergraduate degrees in communications, psychology, and art from
Muskingum College in Ohio, and earned a master’s degree in telecommunications from Ohio University.
Idaho Public Utilities Commission
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K R I S T I N E R A P E R
Commissioner Kristine Raper was appointed to the Commission in February
2015 by Gov. C.L. “Butch” Otter. Her term expires in 2021.
Prior to her appointment, Raper served for seven years as a deputy
attorney general assigned to the Commission. Raper managed a caseload
representing a myriad of regulatory and energy law matters, with a strong
emphasis on the federal Public Utility Regulatory Policies Act (PURPA).
Commissioner Raper has defended the Commission’s decisions at the Idaho
Supreme Court, District Court and Federal Energy Regulatory Commission.
In 2017, Raper testified before the Congressional Subcommittee on Energy
regarding PURPA and its modern-day impacts.
Commissioner Raper currently serves on the Electricity Committee of the
National Association of Regulatory Utility Commissioners’ (NARUC). She is a
member of the Body of State Regulators which contributes to matters involving the Energy Imbalance
Market, a real-time energy market operated by the California ISO.
Commissioner Raper earned an undergraduate degree in Criminal Justice from Boise State University. She
earned her juris doctor degree from the University of Idaho College of Law.
The Commissioner and her husband, Mark, share three children.
Idaho Public Utilities Commission
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E R I C A N D E R S O N
Commissioner Eric Anderson was appointed to his current six-year term in
January 2019 by Gov. Brad Little. It is his second term on the Commission,
having been initially appointed in December 2015 by former Gov. C.L. “Butch”
Otter.
Commissioner Anderson serves on the National Association of Regulatory
Utilities Commissioners (NARUC) Committee on Water as well as its Committee
on International Relations. In November 2019 Commissioner Anderson was
appointed Chair of NARUC’s Committee on Water.
Before joining the Commission, Anderson served five terms in the Idaho
Legislature, from 2004-2014, and was chairman of the House Ways and Means
Committee in his final term in the state Legislature.
As a member of the Idaho House of Representatives, Anderson served on a number of committees, including
Environment, Energy and Technology, Commerce and Human Resources, Resource and Conservation, Business,
and State Affairs. He also chaired a legislative Interim Subcommittee on Renewable Energy.
Anderson received a bachelor of art degree in political science and government from Eastern Washington
University in 1979.
A general contractor and real estate broker, Anderson also served as director and vice president of Sandpoint-
based Northern Lights Inc., an electric cooperative.
He has also served as a director of the Idaho Consumer-Owned Utilities Association, the National Rural Electric
Cooperative Association and the Idaho Energy Resources Authority. He is a past member and advisor to the
Pacific States Marine Fisheries Council and the Pacific Northwest Economic Region’s Executive Council.
Idaho Public Utilities Commission
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FINANCIAL SUMMARY FUND 0229*
Fiscal Years 2015 – 2019
Description FY 2015 FY 2016 FY 2017 FY 2018 FY 2019
Personnel Costs $3,563,500 $3,835,900 $4,070,200 $3,962,400 $3,990,800
Communication Costs $23,500 $28,700 $23,400 $25,000 $23,100
Employee Development Costs $99,200 $98,700 $81,400 $98,800 $95,400
Professional Services $8,500 $8,600 $11,900 $49,000 $35,800
Legal Fees $538,400 $569,100 $482,100 $573,500 $602,600
Employee Travel Costs $152,500 $159,200 $173,900 $204,300 $219,700
Fuel & Lubricants $5,600 $2,900 $4,900 $6,400 $7,700
Insurance $4,300 $2,000 $3,500 $4,500 $3,900
Rentals & Leases $308,600 $223,800 $147,000 $274,400 $76,100
Misc. Expenditures $84,400 $104,300 $114,900 $697,900 $1,663,500
Computer Equipment $73,600 $52,200 $44,700 $9,400 $5,300
Office Equipment $16,500 $8,100 $4,200 $2,100 $0
Motorized/Non-Motorized Equip $32,500 $0 $0 $0 $0
Specific Use Equipment $0 $1,700 $4,500 $2,600 $1,300
Total Expenditures $4,911,100 $5,095,200 $5,166,600 $5,910,300 $6,725,200
Fund 0229-20 Appropriation $5,595,600 $5,766,500 $5,902,700 $6,039,300 $8,556,700
Fund 0229-20 Encumbrances
$32,000 $49,200 $93,800 $393,200
Unexpended Balance $684,500 $639,300 $686,900 $35,200 $1,438,300
*This summary represents assessment funded expenses only. It does not include federal or other funds.
Idaho Public Utilities Commission
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COMMISSION STRUCTURE AND OPERATIONS
Under state law, the Idaho Public Utilities commission supervises and regulates
Idaho’s investor-owned utilities – electric, gas, telecommunications and water –
assuring adequate service and affixing just, reasonable and sufficient rates.
The commission does not regulate publicly owned, municipal or cooperative
utilities.
The governor appoints the three Commissioners with confirmation by the Idaho Senate. No more than two
Commissioners may be of the same political party. The Commissioners serve staggered six-year terms.
The governor may remove a Commissioner before his/her term has expired for dereliction of duty, corruption or
incompetence.
The three-member commission was established by the 12th Session of the Idaho Legislature and was organized
May 8, 1913 as the Public Utilities Commission of the State
of Idaho. In 1951 it was reorganized as the Idaho Public
Utilities Commission. Statutory authorities for the
commission are established in Idaho Code Titles 61 and 62.
The IPUC has quasi-legislative and quasi-judicial as well as
executive powers and duties.
In its quasi-legislative capacity, the commission sets rates
and makes rules governing utility operations. In its quasi-
judicial mode, the commission hears and decides
complaints, issues written orders that are similar to court
orders and may have its decisions appealed to the Idaho
Supreme Court. In its executive capacity, the commission
enforces state laws and rules affecting the utilities and rail
industries.
Commission operations are funded by fees assessed on the
utilities and railroads it regulates. Annual assessments are
set by the commission each year in April within limits set by
law.
The commission president is its chief executive officer.
Commissioners meet on the first Monday in April in odd-numbered years to elect one of their own to a two-year
term as president. The president signs contracts on the commission’s behalf, is the final authority in personnel
matters and handles other administrative tasks. Chairmanship of individual cases is rotated among all three
Commissioners.
Idaho Public Utilities Commission
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The commission conducts its business in two types of meetings – and . Decision
meetings are typically held once a week, usually on Tuesday.
Formal are held on a case-by-case basis, sometimes in the service area of the impacted utility. These
hearings resemble judicial proceedings and are recorded and transcribed by a court reporter.
There are and
. At technical hearings, formal
parties who have been granted “intervenor
status” present testimony and evidence,
subject to cross-examination by attorneys
from the other parties, staff attorneys and
the commissioners. At public hearings,
members of the public may testify before
the commission.
In 2009, the commission began
conducting telephonic public hearings to
save expense and allow customers to
testify from the comfort of their own
homes. Commissioners and other interested
parties gather in the Boise hearing room and
are telephonically connected to ratepayers who call in on a toll-free line to provide testimony or listen in. A court
reporter is present to take testimony by telephone, which has the same legal weight as if the person testifying
were present in the hearing room. Commissioners and
attorneys may also direct questions to those testifying.
The commission also conducts regular decision meetings
to consider issues on an agenda prepared by the
commission secretary and posted in advance of the
meeting. These meetings are usually held Tuesdays at
1:30 p.m., although by law the commission is required to
meet only once a month. Members of the public are
welcome to attend decision meetings.
Typically, decision meetings consist of the commission’s
review of decision memoranda prepared by commission
staff. Minutes of the meetings are taken. Decisions
reached at these meetings may be either final or
preliminary, but subsequently become final when the
commission issues a written order signed by a majority of
the commission. Under the Idaho Open Meeting Law,
commissioners may also privately deliberate fully
submitted matters.
PUC hearing room
PUC headquarters 11331 W. Chinden Blvd.
Building, 8 Suite 201-A, Boise, Idaho 83714.
Idaho Public Utilities Commission
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Commission Staff
OUR MISSION
- Determine fair, just and reasonable rates and utility practices for electric, gas,
telephone and water consumers.
- Ensure that delivery of utility services is safe, reliable and efficient.
- Ensure safe operation of pipelines and rail carriers within the state.
To help ensure its decisions are fair and workable, the commission employs a staff of about 50 people – engineers,
rate analysts, attorneys, accountants, investigators, economists, secretaries and other support personnel. The
commission staff is organized in three divisions – administration, legal and utilities.
Administration
The Administrative Division is responsible for coordinating overall IPUC activities. The division includes the three
commissioners, a policy strategist, a commission secretary, an executive administrator, and support personnel.
The are executive level positions reporting directly to the commissioners with policy and
technical consultation and research support regarding major regulatory issues in the areas of electricity,
telecommunications, water and natural gas. Strategists are also charged with developing comprehensive policy
strategy, providing assistance and advice on major litigation before the commission, public agencies and
organizations.
Contact Stephen Goodson, policy strategist 334-0354.
The , a post established by Idaho law, keeps a precise public record of all commission
proceedings. The secretary issues notices, orders and other documents to the proper parties and is the official
custodian of documents issued by and filed with the commission. Most of these documents are public records.
Contact Diane Hanian, commission secretary, at 334-0338.
The has primary responsibility for the commission’s fiscal and administrative operations,
preparing the commission budget and supervising fiscal, administration, public information, personnel,
information systems, rail section operations and pipeline safety. The executive director also serves as a liaison
between the commission and other state agencies and the Legislature.
Contact Maria Riley-Barratt, executive director, at 334-0337.
The is responsible for public communication between the commission, the general public
and interfacing governmental offices. The responsibility includes news releases, responses to public inquiries,
coordinating and facilitating commission workshops and public hearings and the preparation and coordination of
any IPUC report directed or recommended by the Idaho Legislature or Governor.
Contact Adam Rush, public information officer, at 334-0339.
Idaho Public Utilities Commission
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Legal
Five are assigned to the commission from the Office of the Attorney General and have
permanent offices at IPUC headquarters. The IPUC attorneys represent the staff in all matters before the
commission, working closely with staff accountants, engineers, investigators and economists as they develop their
recommendations for rate case and policy proceedings.
In the hearing room, IPUC attorneys coordinate the presentation of the staff’s case and cross-examine other
parties who submit testimony. The attorneys also represent the commission itself in state and federal courts and
before other state or federal regulatory agencies.
Contact Karl Klein, legal division director, at 334-0320.
Utilities Division
The Utilities Division, responsible for technical and policy analysis of utility matters before the commission, is
divided into four sections.
The staff analyzes each petition, complaint, rate increase request or application for an operating certificate
received by the commission. In formal proceedings before the commission, the staff acts as a separate party to
the case, presenting its own testimony, evidence and expert witnesses. The commission considers staff
recommendations along with those of other participants in each case - including utilities, public, agricultural,
industrial, business and consumer groups.
Contact Terri Carlock, utilities division administrator, at 334-0356.
The of seven auditors audits utility books and records to verify reported revenue, expenses
and compliance with commission orders. Staff auditors present the results of their findings in audit reports as well
as in formal testimony and exhibits. When a utility requests a rate increase, cost-of-capital studies are performed
to determine a recommended rate of return. Revenues, expenses and investments are analyzed to determine the
amount needed for the utility to earn the recommended return on its investment.
Contact Donn English, accounting section program manager, at 334-0362.
The of four engineers reviews the physical operations of utilities. The Staff of engineers and
analysts develops computer models of utility operations and compares alternative costs to repair, replace and
acquire facilities to serve utility customers. The group establishes the price of acquiring cogeneration and
renewable generation facilities and identifies the cost of serving various types of customers. They evaluate the
adequacy of utility services and frequently help resolve customer complaints.
Contact Mike Louis, engineering section program manager, at 334-0316.
The of five utility analysts determines the cost effectiveness of all Demand Side
Management (DSM) programs including energy efficiency and demand response. They identify potential for new
DSM programs and track the impact on utility revenues. They review utility forecasts of energy, water and natural
gas usage with focus on residential self-generation and rate design.
Contact Stacey Donohue, technical analysis program manager, at 334-0363.
Idaho Public Utilities Commission
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The oversee tariff and price list filings, area code oversight, Universal Service, Lifeline
and Telephone Relay Service. They assist and advise the commission on technical matters that include advanced
services, 911 and other matters as requested.
Contact Daniel Klein, telecom analyst 334-0352.
The includes three division investigators who resolve conflicts between utilities and
their customers. Customers faced with service disconnections often seek help in negotiating payment
arrangements. Consumer Assistance may mediate disputes over billing, deposits, line extensions and other
service problems. Consumer Assistance monitors Idaho utilities to verify they are complying with commission
orders and regulations. Investigators participate in general rate and policy cases when rate design and customer
service issues are brought before the commission.
Contact Terri Carlock, utilities division administrator, at 334-0356.
Railroad Safety Section
The oversees the safe operations of railroads that move freight in and through Idaho and
enforces state and federal regulations safeguarding the transportation of hazardous materials by rail in Idaho.
The commission’s rail safety specialists inspect railroad crossings and rail clearances for safety and maintenance
deficiencies. The Rail Section helps investigate all railroad-crossing accidents and makes recommendations for
safety improvements to crossings.
As part of its regulatory authority, the commission evaluates the discontinuance and abandonment of railroad
service in Idaho by conducting an independent evaluation of each case to determine whether the abandonment
of a particular railroad line would adversely affect Idaho shippers and whether the line has any profit potential.
Should the commission determine abandonment would be harmful to Idaho interests, it then represents the state
before the federal Surface Transportation Board, which has authority to grant or deny line abandonments.
Contact Wayne Andrews, rail section manager, at 334-0317.
Pipeline Safety Section
The oversees the safe operation of the intrastate oil and natural gas pipelines in Idaho.
The commission’s pipeline safety personnel verify compliance with state and federal regulations by on-site
inspections of intrastate pipeline distribution systems. Part of the inspection process includes a review of record-
keeping practices and compliance with design, construction, operation, maintenance and drug/alcohol abuse
regulations.
Key objectives of the program are to monitor accidents and violations, to identify their contributing factors and to
implement practices to avoid accidents. All reportable accidents are investigated and appropriate reports filed
with the U.S. Department of Transportation in a timely manner.
Contact Darrin Ulmer, pipeline safety program manager, at 334-0331.
Idaho Public Utilities Commission
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WHY CAN’T YOU JUST TELL THEM NO?
One of the most frequently asked questions the PUC receives after a utility files a rate increase
application is, “Why can’t you just tell them no?” Actually, we can, but not without evidence.
For more than 100 years, public utility regulation has been based on this
between utilities and regulators: Regulated utilities agree to invest in the generation,
transmission and distribution necessary to adequately and reliably serve all the customers in
their assigned territories. In return for that promise to serve, utilities are guaranteed recovery of
their prudently incurred expense along with an opportunity to earn a reasonable rate of return.
The rate of return allowed must be high enough to attract investors for the utility’s capital-
intensive generation, transmission and distribution projects, but not so high as to be
unreasonable for customers.
In setting rates, the commission must consider the needs of the utility and its customers. The commission serves the
public interest, not the popular will. It is not in customers’ best interest, nor is it in the interest of the State of Idaho, to have
utilities that do not have the generation, transmission and distribution infrastructure to be able to provide safe, adequate
and reliable electrical, natural gas and water service. This is a critical, even life-saving, service for Idaho’s citizens and
essential to the state’s economic development and prosperity.
Unlike unregulated businesses, utilities cannot cut back on service as costs increase. As demand for electricity, natural gas
and water grows, utilities are statutorily required to meet that demand. In Idaho recently, and across the nation, a continued
increase in demand as well as a number of other factors have contributed to rate increases on a scale we have not witnessed
before. It is not unusual now for Idaho’s three major investor-owned electric utilities to file annual rate increase requests.
In light of these continued requests for rate increases, the commission walks a fine line in balancing the needs of utilities to
serve customers and customers’ ability to pay.
When a rate case is filed, our staff of auditors, engineers and attorneys will take up to six months to examine the request.
During that period, other parties, often representing customer groups, will “intervene” in the case for the purpose of
conducting discovery, presenting evidence and cross-examining the company and other parties to the case. The commission
staff, which operates independently of the commission, will also file its own comments that result from its investigation of
the company’s request. The three-member commission will also conduct technical and public hearings.
Once testimony from the company, commission staff and intervening parties is presented and testimony from hearings and
written comments is taken, all of that information is included in the official record for the case. It is only from the evidence
contained in this official record that the commission can render a decision.
If the utility has met its burden of proof in demonstrating that the additional expense it incurred was 1) to serve
customers and 2) , the commission must allow the utility to recover that expense. The commission can --
and often does -- deny recovery of some or all the expense utilities seek to recover from customers if the commission is
confident it has the legal justification to do so. Utilities and parties to a rate case have the right to petition the commission
for reconsideration. Following reconsideration, utilities or customer groups can appeal the commission’s decision to the state
Supreme Court.
In the end, the commission’s job is to ensure that customers are paying a reasonable rate and are receiving adequate and
reliable service and that utilities are allowed to recover their prudently incurred expenses and earn a fair rate of return.