20011211_sw.doc

DECISION MEMORANDUM

TO: COMMISSIONER KJELLANDER
COMMISSIONER SMITH
COMMISSIONER HANSEN
JEAN JEWELL
RON LAW
LOU ANN WESTERFIELD
BILL EASTLAKE
TONYA CLARK
DON HOWELL
LYNN ANDERSON
DAVE SCHUNKE
RICK STERLING
RANDY LOBB
BEV BARKER
GENE FADNESS
WORKING FILE
FROM:
DATE:
DECEMBER 11, 2001 RE: CASE NO. AVU-E-01-16 (Avista)
TARIFF SCHEDULE 95—OPTIONAL WIND POWER RATE

On December 3, 2001, Avista Corporation dba Avista Utilities (Avista; Company) filed an Application with the Idaho Public Utilities Commission (Commission) for approval of an Optional Wind Power Rate under proposed Tariff Schedule 95.
Avista’s wind power option is priced in increments, or “blocks”, of $1.00. Each $1.00 block of wind purchased by customers equals 55 kilowatt hours (kWh). Under this “buck-a-block” pricing, customers may consider one of two purchase approaches. Some customers may elect to purchase wind power in one or two dollar monthly amounts with no linkage to their energy usage. These customers, the Company states, may view this payment as a contribution to support alternative energy production. Alternatively, customers can calculate and buy a selected percentage to serve their average monthly load, e. g., a customer who wishes to have half of his or her 1,100 kWh average monthly load served by wind power would pay an incremental $10 per month (i.e., 10 blocks at 55 kWh per block multiplied by $1.00). The optional wind power charge is in addition to all other charges contained in a customer’s applicable tariff schedule. Avista represents that wind power will be delivered to the Company within one year of when the energy was purchased by a customer under this schedule.
Avista states its intention to have its offering “certified” as renewable energy by the regional entity providing such endorsements, Renew 2000. Such certification would support the Company’s marketing efforts and would aid allied marketing by environmental organizations. Renew 2000’s board of directors has indicated that the utility’s minimum 55 kWh block “was ‘certifiable’ if, on average, participating residential customer usage averaged greater than 150 kWh.”
As reflected in the Company’s Application, Avista Utilities is in the process of contracting with PacifiCorp to purchase output from its Stateline Wind Facility on the Oregon-Washington border. The sales agreement would specifically provide for the delivery of wind power to Avista Utility’s system to support customer purchases under Tariff Schedule 95.
All customer classes are eligible to participate in this program. Because the tariff is optional, the rate change associated with this filing is voluntary. The Company estimates that approximately $150,267 (system) in incremental revenue will result from this offering. All incremental revenue will be applied to program costs. The Company represents that there are no earnings associated with this program.
The Company requests that the Commission approve the proposed Schedule 95 Optional Wind Power Rate for an effective date of February 1, 2002.
Commission Decision
Staff recommends that this matter be processed pursuant to Modified Procedure, i.e., by written submission rather than by hearing. Reference Commission Rules of Procedure, IDAPA 31.01.01.201-204. Does the Commission agree with Staff’s proposed procedure? If not, what is the Commission’s preference?

vld/M:AVU-E-01-16_sw

DECISION MEMORANDUM 2