Order No 28677.pdf

Office of the Secretary
Service Date
March 22, 2001
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE APPLICATION TO
APPROVE THE SERVICE TERRITORY
AGREEMENT BETWEEN AVISTA AND
CLEARWATER POWER COMPANY
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CASE NO. AVU-E-01-3

ORDER NO. 28677

On February 1, 2001, Avista filed an Application for approval of a Service Territory
Agreement between itself and Clearwater Power Company. Submission of the Application was
prompted by amendments to the Electric Supplier Stabilization Act (ESSA) enacted in December
2000.1 In an Order dated February 16, 2001, the Commission issued a Notice of Application and
a Notice of Modified Procedure. Only the Commission Staff submitted comments, which
supported adoption of the Service Territory Agreement. In this Order the Commission approves
the Service Territory Agreement as set out in greater detail below.
THE SETTLEMENT AGREEMENT
The Service Territory Agreement submitted for the Commission’s review was a
settlement agreement executed on July 12, 1993. This agreement was reached after Clearwater
filed a complaint against Washington Water Power Company (now known as Avista) in the
Second Judicial District and later in the United States District Court in 1992. Clearwater alleged
that Washington Water Power had violated the Electric Suppliers Stabilization Act by providing
electrical service to an area commonly known as the Vista Addition and Vista Addition
Subdivision (“Vista”) in the city of Moscow. After Washington Water Power filed a

1 Following submission of the Application, the Idaho Legislature approved and the governor signed into law HB
142. HB 142 removed the sunset provision from the ESSA legislation enacted in December 2000. In particular,
Idaho Code § 61-333 was amended to read in pertinent part:

The commission shall after Notice and opportunity for hearing, review and approve or reject
[such] contracts…between cooperatives and utilities…. The commission shall approve such
contracts upon finding that the allocation of territories or customers is in conformance with the
provisions and purposes of this Act.

Idaho Code § 61-333(1)(amended 2001).

ORDER NO. 28677 1
counterclaim, the parties settled the dispute under Idaho Code § 61-333, which authorizes
contracts among electric suppliers to resolve or allocate territories between electrical suppliers.
In the settlement agreement, Washington Water Power and Clearwater split the
electrical service customers in the area in and around the city of Moscow. First, Washington
Water Power would have the exclusive right to continue to serve the area known as Vista.
Agreement § 1. Second, Washington Water Power would exclusively serve the areas numbered
3 and 14 on Latah County Assessor map 10A. Id. § 2. However, Clearwater retained the
exclusive right to serve those lots fronting the north boundary of the Robinson Lake Road right-
of-way not to exceed 300 feet north of the road. Id. § 2. Third, Clearwater would exclusively
serve the area number 2 and that portion of number 15 north of Robinson Lake Road on the
attached map. Id. § 3. Fourth, Clearwater agreed to remove within 90 days the existing
distribution service line on the southern boundary of the Vista subdivision from the end point
east to the last distribution service pole then in use. Id. § 4. Finally, Washington Water Power
agreed not to provide new service or new connections to Syringa Trailer Park, except for any
new accounts or upgrades of existing accounts. Id. § 5. In doing so, Washington Water Power
agreed that it would not provide new connections from the Syringa Trailer Park service line to
the north of the common line between sections 10 and 15 of Range 5W, Township 39N. Id. § 5.
Although neither party admitted liability, they intended this Agreement to settle a
disputed court case. Id. § 6. This settlement agreement does not contain provisions that address
breach of the contract or other standard contract conditions.
STAFF COMMENTS
After reviewing provisions of the Service Territory Agreement according to the
provisions of Idaho Code § 61-333(1), Staff recommended that the Commission approve the
Agreement. Staff noted that in the eight years this agreement has been in effect, “no further
service territory disputes have occurred to Staff’s knowledge, either in this particular area or in
any other area where the two utilities’ service territories are adjacent.” Staff Comments at 3.
Although the Agreement only covers a small portion of the utilities’ service areas near Moscow,
Staff believes “these general provisions have provided and will continue to provide adequate
guidance in most cases.” Staff Comments at 4. Because this Agreement resolved the only
known conflict between Avista and Clearwater, Staff finds “the Agreement has served a valuable
purpose and has clearly met the purposes of the ESSA as amended.” Staff Comments at 3.

ORDER NO. 28677 2
DISCUSSION
After reviewing the Application, the Service Territory Agreement and the pertinent
provisions of the ESSA, we find that the Service Territory Agreement should be approved. We
note that there were no opposing comments and the only comments submitted supported
approval of the Agreement. Avista and Staff agree that the Agreement reduces the possibility of
disputes arising between Avista and Clearwater Power concerning the provision of electrical
service to residential subdivisions. We agree and find that the Service Territory Agreement
promotes “harmony among and between electrical suppliers furnishing electricity within the state
of Idaho.” Idaho Code § 61-332(2) (2001). We also find that the Agreement discourages
“duplication of electrical facilities” by allocating residential customers. Id. Consequently, we
conclude that the Service Territory Agreement is in conformance with the purposes of the ESSA.
O R D E R
IT IS HEREBY ORDERED that Avista Corporation’s Application for approval of a
Service Territory Agreement formed on July 12, 1993, between Avista Utility and Clearwater
Power Company is approved.
THIS IS A FINAL ORDER. Any person interested in this Order (or in issues finally
decided by this Order) or in interlocutory Orders previously issued in this Case No. AVU-E-01-3
may petition for reconsideration within twenty-one (21) days of the service date of this Order
with regard to any matter decided in this order or in interlocutory Orders previously issued in this
Case No. AVU-E01-3. For purposes of filing a petition for reconsideration, this order shall
become effective as of the service date. Idaho Code § 61-626. Within seven (7) days after any
person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code § 61-626.

ORDER NO. 28677 3

ORDER NO. 28677 4
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this
day of March 2001.

DENNIS S. HANSEN, PRESIDENT

MARSHA H. SMITH, COMMISSIONER

PAUL KJELLANDER, COMMISSIONER

ATTEST:

Jean D. Jewell
Commission Secretary

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