20060815Application.pdf

August 14, 2006
RECEIVED
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IOAHO P4EH.
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UTILITIES COt\E
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Corp.
Avista Corp.
1411 East Mission P.Box3727
Spokane. Washington 99220-0500
Telephone [phone]
Toll Free 800-727-9170
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State of Idaho
Idaho Public Utilities Commission
Statehouse
Boise, ID 83720
Attention: Ms. Jean Jewell, Secretary
Submission of Power Cost Adjustment (PCA) Status Report of A vista Corporation
And Request for Recovery of Power Costs Deferred through June 30,2006
Enclosed for filing with the Commission are an original and seven copies of the PCA Status
Report of Avista Corporation and Request for Recovery of Power Costs Deferred through June
, 2006. Also enclosed are nine copies of prefiled direct testimony and exhibits. Three copies
of supporting workpapers including monthly PCA reports for the months of July 2005 through
June 2006 are enclosed. Also enclosed is a Certificate of Service.
Please direct any questions regarding this filing to Ron McKenzie at [phone].
Sincerely,
70r ~ ~ ..m-J
Kelly Norwood
Vice President, State and Federal Regulation
Enclosures
David J. Meyer
Vice President and Chief Counsel of
Regulatory and Governmental Affairs
A vista Corporation
1411 E. Mission Avenue
P. O. Box 3727
Spokane, Washington 99220
Phone: [phone], Fax: [phone]
RECE\VED
100G AUG \ 5 AM \0:
IDAHO p~~!,
UTILITIES COMI"IlISSION
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE SUBMISSION OF THE
POWER COST ADJUSTMENT (PCA) STATUS
REPORT OF AVISTA CORPORATION AND
REQUEST FOR RECOVERY OF POWER COSTS
DEFERRED THROUGH JUNE 30, 2006
CASE NO. AVU-06-
I. INTRODUCTION
A vista Corporation, doing business as A vista Utilities (hereinafter A vista or Company), at
1411 East Mission Avenue, Spokane, Washington, respectfully files the status report as required by
the Commission 1 , and requests the Commission issue an order approving recovery of power costs
deferred through June 30, 2006, and the continuation of the existing PCA surcharge. The existing
PCA surcharge of2.448% was approved effective April 15, 2005 by Order No. 29752 dated April
, 2005 in Case No. A VU-05-1. In that case the PCA surcharge was reduced to offset the
increase in base tariff rates to recover costs associated with the purchase of the second half of the
Coyote Springs 2 generating plant.
As stated by the Commission at page 2 of its Order No. 29881 dated October 4, 2005 in Case No. A VU-05-
The Company is directed to file a status report on or before August 15, 2006, accounting for PCA funds and
payment of the power cost deferral, covering the period from July 1 , 2005 through June 30, 2006.
A VISTA'S APPLICATION FOR RECOVERY OF DEFERRED POWER COSTS PAGEl
A 19.4% surcharge was originally authorized by this Commission by Order No. 28876 dated
October 11 2001 in Case No. A VU-Ol-ll. The surcharge was extended by Order No. 29130
dated October 11 , 2002 in Case No. A VU-02-, and by Order No. 29377 dated November 18
2003 in Case No. A VU-03-6. The surcharge was reduced to 4.385% effective September 9 2004
in conjunction with a general rate increase authorized by Amended Interlocutory Order No. 29588 in
Case No. A VU-04-1 dated September 9 2004. The surcharge was then reduced to the existing
level of2.448% effective April 15, 2005 in Case No. A VU-05-1. The surcharge was extended by
Order No. 29881 in Case No. A VU-05-6 dated October 4 2005.
Pursuant to Order No. 29881 in Case No. A VU-05-, this filing, along with the attached
testimony and associated workpapers (incorporated herein by reference), serves as the PCA status
report for twelve months ended June 30, 2006. In this filing the Company has identified the power
cost deferrals during the review period, and has explained the primary factors causing the PCA
deferrals.
The Company requests that this status report be processed under the Commission s Modified
Procedure rules.
Communications in reference to this Application should be addressed to:
Kelly O. Norwood
Vice President
State and Federal Regulation
A vista Corporation
1411 E. Mission Avenue
Spokane, Washington 99220
Phone: [phone]
Fax: [phone]
David J. Meyer
Vice President and Chief Counsel of
Regulatory and Governmental Affairs
A vista Corporation
1411 E. Mission Avenue
Spokane, Washington 99220
Phone: [phone]
Fax: [phone]
II. DEFERRAL ACTIVITY AND REPORTING
A VISTA'S APPLICATION FOR RECOVERY OF DEFERRED POWER COSTS PAGE 2
The deferral balance of $5.9 million at June 30, 2005 is shown below, together with the
changes in the balance through June 30 2006. Mr. McKenzie s testimony explains the changes in
the deferral balance and Mr. Storro s testimony provides additional explanation of the factors
causing the deferral entries for the period July 2005 through June 2006. Net deferrals for the twelve
month period were $98 317 in the rebate direction.
Unrecovered balance at June 30, 2005
Net Deferral Activity (July 2005 - June 2006)
Amortizations Related to Surcharge Revenues (July 2005 - June 2006)
Interest
Unrecovered balance at June 30, 2005
935 324
317
599 432
279,528
$1.517.103
Monthly reports have been filed with the Commission regarding actual PCA deferral entries
to date. To facilitate Staffs review, additional copies of those reports for the months of July 2005
through June 2006 have been included with this filing and have also been provided to Potlatch
Corporation who intervened in A VU-Ol-ll and A VU-02-
III. NO TARIFF CHANGES
The Company is not proposing to change the existing PCA surcharge rates as set forth under
Eighth Revision Sheet 66 as a result of this filing. While the annual amount of revenue under the
existing surcharge of approximately $4.3 million is greater than the unrecovered surcharge balance at
June 30, 2006 of$I.5 million, the unrecovered surcharge balance is expected to grow. Mr. Storro
testimony explains the reasons that actual power costs are expected to exceed authorized power costs
and what the effect is forecasted to be on the deferral balance. At July 31 2006 the deferral balance
had grown to $3.2 million. In all likelihood, the deferral balance by the end of August will be higher
than the annual surcharge revenue level of $4.3 million. With the existing surcharge remaining in
place the deferral balance is expected to be approximately $8.7 million at the end of the year.
A VISTA'S APPLICATION FOR RECOVERY OF DEFERRED POWER COSTS PAGE 3
However, should conditions turn out to be more favorable than expected, resulting in the deferral
balance reaching zero at some point, the Company will make a filing to either zero-out the surcharge
rates, or to continue or modify the rates depending upon actual and expected power supply
conditions at the time. Should the surcharge rates not be modified prior to filing the next PCA
status filing covering the July 2006 through June 2007 twelve-month period, the surcharge rates will
be reviewed as a part of that filing.
IV. REQUEST FOR RELIEF
The Company respectfully requests the Commission for an order approving recovery of
power costs deferred through June 30 , 2006 and the continuation of the existing PCA surcharge
rates. The Company requests that this status report filing and request for recovery of deferred power
costs be processed under the Commission s Modified Procedure rules.
Dated at Spokane, Washington this 14th day of August 2006.
A VISTA CORPORATION
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Vice President and Chief Counsel of
Regulatory and Governmental Affairs
A VISTA'S APPLICATION FOR RECOVERY OF DEFERRED POWER COSTS PAGE 4
VERIFICATION
ST ATE OF WASHINGTON)
County of Spokane
David J. Meyer, being first duly sworn on oath, deposes and says: That he is the Vice
President and Chief Counsel of Regulatory and Governmental Affairs of A vista Corporation and
makes this verification for and on behalf of said corporation, being thereto duly authorized;
That he has read the foregoing filing, knows the contents thereof, and believes the same to be
true.
~//
SIGNED AND SWORN to before me this 14th day of August 2006, by David 1. Meyer.
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NOTARY ' BLIC in and for the State of
Washington, residing at Spokane.
Commission Expires:
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A VISTA'S APPLICATION FOR RECOVERY OF DEFERRED POWER COSTS PAGE 5
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that I have served Avista Corporation s filing related to
Avista Corporation s submission of the Power Cost Adjustment (PCA) Status
Report and Request for Recovery of Power Costs Deferred through June 30
2006, by mailing a copy via overnight mail thereof, postage prepaid to the
following:
Ms Jean D Jewell, Secretary
Idaho Public Utilities Commission
PO Box 83702
West 472 Washington
Boise , ID 83720-5983
Pam Mull
Potlatch Corporation
601 W. Riverside Ave.
Suite 1100
Spokane , WA 99201
(Workpapers Not Included)
Conley E. Ward
Givens Pursley LLP
601 W. Bannock St.
Boise, ID 83701-2720
Dated at Spokane, Washington this 14th day of August 2006.
Rates Coordinator