20061023Comments.pdf

DONOV AN E. WALKER
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 5921
RECEIVED
200& OCT 23 Pli 2: 32
101\1-:0 \:JUfJLiC
UTilitIES COMtAISSIOi';
Street Address for Express Mail:
472 W. WASHINGTON
BOISE, ID 83702-5983
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF
A VISTA CORPORATION TO APPROVE AN
AGREEMENT ALLOCATING TERRITORY
WITH NORTHERN LIGHTS, INc. CASE NO. A VU-O6-
COMMENTS OF THE
COMMISSION STAFF
The Staff of the Idaho Public Utilities Commission, by and through its Attorney of record
Donovan E. Walker, Deputy Attorney General, respectfully submits the following comments in
response to Order No. 30133 , issued on October 2 2006.
BACKGROUND
On September 7 2006, Avista Corporation dba Avista Utilities filed an Application to
approve an agreement allocating service territory with Northern Lights, Inc. pursuant to the
Electric Supplier Stabilization Act (ESSA), Idaho Code 99 61-332 et seq.
The parties have entered into an agreement pursuant to the ESSA in order to allow A vista
to supply electric service to a Northern Lights customer, Treeland Partners LLC (the Developer).
Northern Lights has agreed to relinquish the right to serve the Developer s 34-lot parcel in
Sandpoint, Idaho to A vista.
STAFF COMMENTS OCTOBER 23, 2006
The Application states that Northern Lights currently provides electric service to two
structures adjacent to a portion of the Development. These two structures are currently scheduled
for demolition, and a new access road is scheduled to go in at the demolition site. The Developer
has requested Northern Lights to remove its electric facilities from the demolition site to enable
the construction of the access road. Once the facilities are removed A vista will be the closest
utility to the majority ofthe 34 lots within the Development.
According to the Customer Allocation Agreement (Attachment #1 to the Application) the
Developer has requested A vista to provide the backbone infrastructure and to provide electric and
natural gas services to the entire development, and that it is in the Developer s best interest to
have a single source utility provider to serve the development. Northern Lights has agreed to
allow A vista to provide electric service to the entire Development.
Idaho Code 9 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 Avista
and Northern Lights are defined as electric suppliers. Idaho Code 9 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 9 61-333A(1). As set out in Idaho
Code 9 61-332(2), the purpose of the ESSA is to: discourage duplication of facilities; prohibit
pirating" of consumers; stabilize service territories and consumers; and promote harmony
between electric suppliers.
ANALYSIS
Staffhas reviewed the Application submitted by Avista Utilities (Avista) to determine if
the customer allocation is in conformance with the ESSA. This particular case is closely related
to pending Case No. A VU-06- 7, in which Avista and Northern Lights have entered into
agreement regarding the actual service territory to be assumed by the respective utilities. The
service territory agreements are necessary as Sandpoint and its surrounding areas receive electric
service from multiple vendors, and concerns by Staff over the lack of a comprehensive expansion
plan in Northern Idaho are addressed in the comments filed in Case No. A VU-06- 7. Avista and
Northern Lights have entered into an agreement concerning the service to the Developer, assuring
that the stability and harmony standards of the ESSA are satisfactorily met.
STAFF COMMENTS OCTOBER 23, 2006
The removal of the existing Northern Lights facilities located within the Spring Creek
Development area alleviates the concern of duplication of electrical facilities. Northern Lights
has agreed to remove existing facilities at the request of the Developer that enter from the west
side into the proposed development approximately midway from the southern edge of the
development. A vista has existing service entering from the south of the proposed development
which follows a natural path created by Boyer Avenue, a main thoroughfare in Sandpoint. Spring
Creek Development is situated along the east side of Boyer Avenue, which serves as a clear
delineating feature for the two utilities. See Exhibit B submitted in Case No. A VU-06- 7.
Given the location of the proposed development and the existing service territories, it is logical
that A vista be the sole provider of electric (and natural gas) service to the Developer.
Within its filing, A vista has submitted the Application for line extension into the
Development, along with the primary plat. There were some discrepancies as to the size of the
Development. Originally the development plan had a total of 41 lots delineated rather than the
final number of 34 lots. A vista has stated to Staff that a different developer, who has separated
himself from the group that has entered into this particular customer allocation agreement, owns
the parcel that includes the 7 additional lots. This parcel is located on the southern edge of the
Development, which currently is part of Avista s service territory, though the ESSA may require
a service territory allocation filing from A vista prior to providing service.
The submitted line extension agreement has been amended to include only the final 34 lots
making up the Spring Creek Development. As such, the Developer has signed a promissory note
for the amount of $31 280, or 34x$920. Under Section 4c of the Line Extension policy, a
Developer may receive a $413 per lot reduction from the basic cost of $1 333 per lot if providing
the ditching associated with the electric infrastructure. A vista s natural gas line extension policy
does not require the Developer to include any additional cash payment or credit instrument for
extension of natural gas services into the development.
STAFF RECOMMENDATIONS
Avista and Northern Lights have demonstrated that the customer allocation and
subsequent service territory allocation agreement entered into by both parties is in conformance
with the provisions and intent of the ESSA. Avista has also entered into a contractual agreement
with the Developer that meets the guidelines of Schedule 51 , Section 4, A vista s line extension
STAFF COMMENTS OCTOBER 23, 2006
policy. Staff therefore recommends that the Commission approve the service territory allocation
as submitted.
Respectfully submitted this 23 ttf day of October 2006.
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Donovan E. Walker
Deputy Attorney General
Technical Staff: Dave Schunke
Bryan Lanspery
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STAFF COMMENTS OCTOBER 23 , 2006
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 23RD DAY OF OCTOBER 2006
SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN CASE
NO. AVU-06-, BY E-MAILING A COpy THEREOF AND BY MAILING A COpy
THEREOF, POSTAGE PREPAID, TO THE FOLLOWING:
BRIAN HIRSCHKORN
MGR PRICING/ RATES & REG
A VISTA CORPORATION
PO BOX 3727
SPOKANE W A 99220-3727
LINDA GERV AIS
REGULATORY ANALYST
A VISTA CORPORATION
1411 EMISSION AVE
SPOKANE W A 99220
SE TARY
CERTIFICATE OF SERVICE