20060508final_order_no_30033.pdf

Office of the Secretary
Service Date
May 8, 2006
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE PETITION FILED
BY IDAHO POWER COMPANY FOR AN CASE NO. IPC-06-
ORDER RESCINDING ORDER NO. 28804
IT APPLIES TO IDAHO POWER COMPANY
TO DISCONTINUE THE REQUIREMENT
TO FILE BIENNIAL COST INFORMATION-
UNBUNDLING REPORTS
IN THE MATTER OF THE PETITION FILED
BY A VISTA CORPORATION DBA A VISTA CASE NO. A VU-06-
UTILITIES FOR AN ORDER TO
DISCONTINUE THE REQUIREMENT TO
FILE BIENNIAL COST INFORMATION-
UNBUNDLING REPORTS
IN THE MATTER OF THE PETITION OF
PACIFICORP DBA UTAH POWER & LIGHT CASE NO. P AC-06-
COMPANY REQUESTING THAT ITS
BIENNIAL UNBUNDLED COST
INFORMATION REPORTING
REQUIREMENT BE DISCONTINUED ORDER NO. 30033
On February 28 , 2006, Idaho Power Company ("Idaho Power ) filed a Petition
seeking relief from the requirements of Order No. 28804, as it applies to Idaho Power. Order
No. 28804 requires Idaho Power, Avista Corporation ("A vista ) and PacifiCorp dba Utah Power
Light ("PacifiCorp ) to file biennial cost information-unbundling reports with the
Commission. On March 10, 2006, A vista filed a similar Petition, asking for relief from the filing
requirements of Order No. 28804 as it applies to Avista. On March 10, 2006, PacifiCorp also
filed a similar Petition, asking for relief from the filing requirements of Order No. 28804 as it
applies to PacifiCorp.
On March 30, 2006, the Commission issued a Notice of Petitions, Notice of Modified
Procedure and a request for comments. Order No. 30009. The Commission also approved the
consolidation of these matters for hearing. The only comments received were submitted by
Staff.
ORDER NO. 30033
BACKGROUND
Order No. 28804 was issued by the Commission on August IS, 2001. Under this
Order, Idaho Power, A vista and PacifiCorp are obligated to file biennial cost reports that include
inter alia unbundled cost information at the actual earned rate of return and not adjusted to
authorized return levels, as well as the actual earned rate of return for each customer class.
In its Petition, Idaho Power states that it intends to regularly file general rate actions
with the Commission that would enable the Commission to routinely examine its costs. Idaho
Power believes that these more frequent rate case filings will allow the Commission and its Staff
the opportunity to review Idaho Power s costs in greater detail than afforded in the biennial cost
reports.
PacifiCorp similarly states in its Petition that it anticipates that regular rate case
actions will be needed in the future, and that such rate case filings will afford the Commission
and its Staff the opportunity to review PacifiCorp s costs. It further states that in addition to the
review allowed by rate case filings , the Commission and its Staff receive PacifiCorp s annual
results of operations.PacifiCorp will file these results for the 10 years following the
Commission ratification of the Revised Protocol, PacifiCorp inter-jurisdictional cost
allocation methodology.
A vista states that given the anticipated frequency with which it intends to file general
rate cases, it believes the Commission and its Staff will continue to have access to Avista s costs
through the cost of service studies that are part of the rate cases.
COMMENTS
Staff noted that unbundled cost studies breakout the costs of providing service by rate
schedule or by delivery voltage level. Costs are identified as generation related, transmission
related, distribution related or other. Some of the four major categories are further divided into
subcategories. Staff acknowledged that by Commission Order, the three electric utilities
participating in these matters have filed unbundled cost studies with the Commission for 1996
1998, 1999, 200 I and 2003. The Staff uses or references this unbundled cost information from
time to time.
The Staff believes that with the larger staffs that the three electric utility companies
employ, and the fact that the companies' staffs are more acquainted with their own models and
data, it is easier for the companies to do these studies than it would be for the Staff to complete
ORDER NO. 30033
them. However, Staff observes that this information is only occasionally needed and that, in
general, unbundled cost results change slowly and, therefore, this type of analysis can be done on
an infrequent basis.
The Staff observes that there is every indication that all three utilities will have more
frequent rate cases in the near term. General rate cases require the companies to file cost of
service information, which contains the elements of the companies' costs used to derive
unbundled costs. The Staff believes, however, that there is a substantial effort involved in
putting the data in the unbundled cost format. Staff further believes it will have an opportunity
during the course of a rate case to request this information from the relevant company if it is
deemed necessary.
Due to the infrequent requirements for unbundled cost information, Staff supports the
three Companies' Applications to discontinue the biennial filings required by Order No. 28804.
However, Staff requests that the Commission order the Companies to provide unbundled cost
information upon Staff request in a general rate case. As time allows, Staff commits to work to
develop the models necessary to extract and organize the information.
FINDINGS
After reviewing these Petitions and the written comments, the Commission finds that
the Companies shall not be required to file these biennial cost reports with the Commission. Due
to the Companies' statements that they will be filing for more frequent general rate cases , thus
allowing for more frequent scrutiny of their costs, the need to file the unbundled reports
biennially is reduced. As these reports can provide information that is important and insightful
however, the Commission finds that the Companies should be prepared to provide such reports
to Commission Staff upon Staff s request during a general rate case, and they may assume that
the Commission will reinstate the requirement ifthe Companies do not comply with the request.
ORDER
IT IS HEREBY ORDERED that Idaho Power Company, Avista Corporation and
PacifiCorp are not subject to the requirement under Order No. 28804 to file biennial cost reports
containing unbundled cost information, unless and until the Commission reinstates the
requirement.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days of the service date of this Order. Within seven (7)
ORDER NO. 30033
days after any person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code 9 61-626.
DONE by Order ofthe Idaho Public Utilities Commission at Boise, Idaho this
gf/o-
day of May 2006.
MARSHA H. SMITH, COMMISSIONER
(kz
ATTEST:
~Cj
J a D. Jewe
Commission Secretary
0: IPC-06-A VU-06-PAC-06-cg2
ORDER NO. 30033