20200204_dh2.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER RAPER
COMMISSIONER ANDERSON
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM:DAYN HARDIE
DEPUTY ATTORNEY GENERAL
DATE:JANUARY 31,2020
SUBJECT:IN THE MATTER OF IDAHO POWER COMPANY'S APPLICATION TO
MODIFY SCHEDULE 30,SPECIAL CONTRACT WITH UNITED
STATES DEPARTMENT OF ENERGY;CASE NO.IPC-E-20-01.
On January 14,2020,Idaho Power Company ("Company"or "Idaho Power")applied to
the Commission for an order authorizing the Company to (1)modify Schedule 30-Electric
Service Rate for United States Department of Energy Idaho Operations Office-("Schedule30"),
and (2)true-up charges related to the Company's Schedule 30 assets that have been suspended
since November 2015.The Company requests an effective date of April 1,2020 and that its
Application be processed by Modified Procedure.
BACKGROUND
The genesis of the proposed modification to Schedule 30 is an August 21,2019 transfer of
title agreement entered between the Department of Energy ("DOE")and the Company-
transferring ownership of DOE owned asset to the Company.See Attachment 1.Concurrentlywith
the transfer agreement between the DOE and the Company,the Company transferred partial
ownership of those same assets'under a separate transfer of title agreement entered between the
Company and PacifiCorp,dated August 22,2019.See Attachment 2.
The Company supplies electricity to the DOE at Idaho National Laboratory via the
Antelope transmission substation facilities from the Antelope substation ("Substation")under
Schedule 30.Prior to the transfer agreements,the Company,PacifiCorp,and DOE jointly or
1 Regarding the assets transferred from Idaho Power to PacifiCorp,and for purposes of the JOOA,the Weighted Average
Ownership Percentage will be 53.365%for Idaho Power and 46.635%for PacifiCorp.
DECISION MEMORANDUM l
individually owned Substation assets and PacifiCorp operated it.PacifiCorp's operation of the
Substation.and the assets located therein,flow from a Joint Ownership and Operating Agreement
("JOOA").Before the DOE to Idaho Power transfer,the Company's point of delivery to the DOE
under Schedule 30 was at the DOE-owned assets at the Substation.
The DOE "no longer wish[ed]to own,operate [or]maintain"its Substation assets and
voluntarily transferred them to the Company at no cost.In turn,the Company transferred partial
ownership of the DOE's assets to PacifiCorp,again at no cost.As a result of the change in
ownership of the assets transferred from DOE to the Company,the Company filed with the Federal
Energy Regulatory Commission ("FERC")for an updated JOOA,which was approved by FERC
on October 21,2019.
THE APPLICATION
After transferring its assets to the Company,the DOE no longer owns any Substation
assets.But the Company continues to incur operating costs because it still serves the DOE.The
Company proposes to modify Schedule 30 by adding a monthlyAntelope Asset Charge ("AAC").
See Attachment 3.The AAC would include two components:1)PacifiCorp Pass-Through Charge,
and 2)Company Ownership Costs.The AAC charge would enable the Company to recover its
costs to own,operate,and maintain the Substation assets required to serve the DOE.According to
the Application,PacifiCorp would continue to operate the Substation under the updated JOOA.
In November 2015,the Company and DOE agreed to suspend payment of pass-through
expenses related to Substation assets until regulatory approvals were in place and the new Schedule
30 charge had commenced.If the modifications to Schedule 30 are approved,the Company
proposes to collect about $288,000 from the DOE for the suspended pass-through charges the
Company incurred on behalf of the DOE from PacifiCorp between November 2015 and December
2019.
STAFF RECOMMENDATION
Staff recommends that the Commission issue a Notice of Application and Notice of
Modified Procedure setting a March 10,2020 comment deadline,a March 17,2020 reply comment
deadline.
DECISION MEMORANDUM 2
COMMISSION DECISION
Does the Commission wish to issue a Notice of Application and Notice of Modified
Procedure setting a March 10,2020 comment deadline and a March 17,2020 reply comment
deadline?
Dayn S.Hardie
Deputy Attorney General
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DECISION MEMORANDUM 3