20050422Decision Memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER SMITH
CO MMISSI 0 NER HANSEN
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM:DONOVAN E. WALKER
DATE:APRIL 19, 2005
SUBJECT:CONSUMER ALLOCATION AGREEMENT BETWEEN AVISTA
UTILITIES AND INLAND POWER & LIGHT - CASE NO. A VU-05-
On February 17 , 2005, Avista Corporation dba Avista Utilities filed an Application
seeking the Commission s approval of a contract between Avista and Inland Power & Light
Company (Inland Power) to release a customer. The parties
' "
Agreement to Release Customer
is dated January 25, 2005. The Agreement was executed pursuant to the provisions of the
Electric Supplier Stabilization Act (ESSA) and specifically Idaho Code ~ 61-333(1).
On March 28, 2005, the Commission issued Order No.29741 requesting that
interested persons file comments regarding the ESSA Agreement no later than April 18 , 2005.
Only the Commission Staff filed comments and it recommended that the Commission approve
the ESSA Agreement.
THE APPLICATION
A vista and Inland Power have proposed an Agreement whereby Inland Power has
agreed to relinquish the right to serve the West Bonner Library Districts' new facility located in
Spirit Lake, Idaho. The West Bonner Library District intends to construct a library in Spirit
Lake. Avista has existing service lines near the property, however, Inland Power s existing
service lines are closer and therefore it had the right to serve the customer. Based upon the
physical location of Inland Power s infrastructure, with a building in the way of the service
access, its cost to serve the new library would be substantially more than A vista s cost to serve.
The Application states that the Agreement is in the best interest of the customer, will avoid
duplication of facilities, avoid disputes between parties, and provides the consumer with the best
DECISION MEMORANDUM
possible serVIce. The Agreement and property description are attached to the Company
Application. The Agreement is also endorsed by a representative of the West Bonner Library
District, the customer to be served by this Agreement. The customer approves, and agrees to be
bound by, the Agreement.
Idaho Code ~ 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
A vista and Inland Power are defined as electric suppliers. Idaho Code ~ 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 ~~ 61-333(1), 61-334B(I). The
purposes of the ESSA are to: discourage duplication of facilities; prohibit the "pirating" of
consumers; stabilize service territories and consumers; and promote harmony between electric
suppliers. Idaho Code ~ 61-332(2).
ST AFF COMMENTS
After reviewing the Application and the accompanYIng Agreement Staff
recommends that the Commission approve the Agreement. Staff noted that the Agreement will
allow A vista and Inland Power to avoid duplication of services, stabilize their respective service
territories and customers, and promote harmony by avoiding interconnection disputes. Idaho
Code ~ 61-332(2).
COMMISSION DECISION
Does the Commission wish to approve the territory and customer allocation
Agreement between A vista and Inland Power & Light? Does the Commission find that the
Agreement comports with the purposes of the ESSA?
DECISION MEMORANDUM