20060914Application.pdf

Avista Corp.
1411 East Mission PO Box 3727
Spokane, Washington 99220-3727
Telephone [phone]
Toll Free 800-727-9170 RECEIVED
200& SEP I AM 9: 4 ,
September 13 , 2006 \D/:J-j.o Pl!~~\C '
UTIL\T\E~ COi~"M\SSIOI"
Ms. Jean D. Jewell, SecreTary
Idaho Public Utilities Commission
472 W. Washington St.
Boise, ID 83720
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'V'STA.
Corp.
Dear Ms. Jewell:-A V "6- 4-0
Tariff LP.C. No. 28, Electric Service
Temporary Rate Adjustment Schedule 65
Enclosed for filing with the Commission is an original and seven copies of the following tariff
sheet:
First Revision Sheet 65 Canceling Original Sheet 65
The proposed tariff sheet eliminates or zeros-out the temporary rate adjustment rate credits that
have been used to pass through the customer portion of the gain on the sale of the Centralia Power
Plant. The proposed effective date is November 1 , 2006. The Company expects that the customer
portion of the gain on the sale of the Centralia Power Plant will be fully refunded to customers by
November 1 , 2006. Elimination of the rate credit will result in an overall annual increase in Idaho
electric revenue of approximately $2.5 million or 1.45% and will affect all electric customers.
The elimination of the rate credit will have no effect on Avista s net income.
A residential customer using 1 000 kilowatt-hours per month will see an increase of $0.91 or
1.45% in their monthly bill due to the elimination of the temporary Centralia gain rate credit. In a
separate filing the Company is proposing, also effective November 1 , 2006 , to increase the rate
credit applicable to residential and small farm customers to pass through increased residential
exchange benefits it will receive from the Bonneville Power Administration. That filing will
result in a proposed decrease of $0.47 or 0.75% per month for a residential customer using 1 000
kilowatt-hours per month. The net increase to a residential customer using 1 000 kilowatt-hours
per month from the elimination of the temporary Centralia gain rate credit and the increase in the
residential and small farm exchange credit amounts to $0.44 or 0.70%.
Enclosed are copies of the existing tariff Schedule 65 with the old rates crossed out and with the
proposed zero-rates underlined, an Application that provides information supporting the proposed
tariff, a notice to customers that will be posted in the Company s offices and included as an insert
in customer bills, a copy of a press release, and a set of workpapers. If you have any questions
regarding this filing, please contact Ron McKenzie at [phone].
Sincerely,
70r ~,,
Kelly Norwood
Vice President State and Federal Regulation
Enclosures
I.P.C. No.
First Revision Sheet 65
Canceling
Original Sheet 65
AVISTA CORPORATION
d/b/a Avista Utilities
SCHEDULE 65
TEMPORARY RATE ADJUSTMENT -IDAHO
AVAILABLE:
To Customers in the State of Idaho where the Company has electric service
available. This Temporary Rate Adjustment shall be applicable to all retail
customers for charges for electric energy sold and to the flat rate charges for
Company-owned or Customer-owned Street Lighting and Area Lighting Service.
This Temporary Rate Adjustment is designed to pass through the customer portion
of the gain on the sale of the Centralia Power Plant.
MONTHLY RATE:
The energy charges for the individual rate schedules are to be decreased by
the following amounts:
Schedule 1
Schedule 11 & 12
Schedule 21 & 22
Schedule 25
Schedule 31 & 32
oooit
0001t
0001t
0001t
0001t
Flat rate charges for Company-owned or Customer-owned Street Lighting
and Area Lighting Service (Schedules 41-49) are to be decreased by 0.000%.
SPECIAL TERMS AND CONDITIONS:
Service under this schedule is subject to the Rules and Regulations
contained in this tariff.
The above Rate is subject to increases as set forth in Tax Adjustment
Schedule 58.
Issued September 13, 2006 Effective November 1 , 2006
Issued by Avista Utilities
By
~.:...
Kelly Norwood - Vice President, State and Federal Regulation
I.P.C. No.Original Sheet 65
AVISTA CORPORATION
d/b/a Avista Utilities
SCHEDULE 65
TEMPORARY RATE ADJUSTMENT - IDAHO
AVAILABLE:
To Customers in the State of Idaho where the Company has electric service
available. This Temporary Rate Adjustment shall be applicable to all retail
customers for charges for electric energy sold and to the flat rate charges for
Company-owned or Customer-owned Street Lighting and Area Lighting Service.
This Temporary Rate Adjustment is designed to pass through the customer portion
of the gain on the sale of the Centralia Power Plant.
MONTHLY RATE:
The energy charges for the individual rate schedules are to be decreased by
the following amounts:
Schedule 1
Schedule 11 & 12
Schedule 21 & 22
Schedule 25
Schedule 31 & 32
001 ~
121~
085~
050~
073~
ooo
OOO
OOO
OOO
OOO
Flat rate charges for Company-owned or Customer-owned Street Lighting
and Area Lighting Service (Schedules 41-49) are to be decreased by 777%
000%
SPECIAL TERMS AND CONDITIONS:
Service under this schedule is subject to the Rules and Regulations
contained in this tariff.
The above Rate is subject to increases as set forth in Tax Adjustment
Schedule 58.
Issued July 7, 2000 Effective August 1 , 2000
Issued by Avista Utilities
Thomas D. Dukich Manager, Rates & Tariff Administration
RECEIVED
David J. Meyer 200& SEP I (; AM 9:
Vice President and Chief Counsel of
. ~
DAHO PubliCRegulatory and Governmental Affalr~'TILI
(:'
.; HI SIOCJ - v ,Vj NI 1";A vista Corporation
1411 E. Mission Avenue
P. O. Box 3727
Spokane, Washington 99220
Phone: [phone], Fax: [phone]
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MA TIER OF THE APPLICATION OF
A VISTA CORPORATION FOR ELIMINATION OF )
THE TEMPORARY RATE ADJUSTMENT TO
P ASS THROUGH THE CENTRALIA GAIN
CASE NO. AVU-06-
APPLICATION OF
A VISTA CORPORATION
I. INTRODUCTION
A vista Corporation doing business as A vista Utilities (hereinafter A vista or Company), at
1411 East Mission Avenue, Spokane, Washington, respectfully requests that the Commission
approve the elimination of the temporary rate adjustment rate credits that have been used to pass
through the customer portion of the gain on the sale of the Centralia Power Plant. Temporary Rate
Adjustment Schedule 65 is the tariff sheet that contains the rate credits currently in effect. The
Company is proposing that the Schedule 65 rate credits be eliminated , or zeroed-out effective
November 1 , 2006. The Company expects that the customer portion of the gain on the sale of the
Centralia Power Plant will be fully refunded to customers by November 1 2006. Elimination ofthe
rate credit will result in an overall annual increase in Idaho electric revenue of approximately $2.
million or 1.45% and will affect all electric customers. In a separate filing the Company is
proposing, also effective November 1 , 2006, to increase the rate credit applicable to residential and
A VISTA'S APPLICA nON TO ELIMINATE TEMPORARY RATE ADJUSTMENT PAGEl
small farm customers to pass through increased residential exchange benefits it will receive from the
Bonneville Power Administration. The increase in the residential exchange rate credit amounts to a
decrease of approximately 0.75%, which, for residential and small farm customers, will partially
offset the increase caused by eliminating the Centralia gain credit.
The Company requests that this filing 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. BACKGROUND
The Commission approved the sale ofthe Company s interest in the Centralia Power Plant in
Order No. 28297 dated March 7 2000 in Case No. A VU-99-6. The customer portion ofthe gain
was deferred and was originally to be passed on to customers over an eight-year period. Potlatch'
Lewiston facility was exempted from receiving any portion of the gain as the facility was served
under a special service contract. The Centralia gain rate credits contained on Original Sheet 65 were
effective August 1 , 2000. Beginning January 1 , 2002 Potlatch began receiving service under
Schedule 25 - Extra Large General Service and began receiving and has continued to receive the
Centralia gain credit applicable to Schedule 25 of 0.059~ per kilowatt-hour.
The Commission approved the sale of the Company s interest in the Skookumchuck
hydroelectric generation facility, which is operated to supply cooling water to the Centralia Power
A VISTA'S APPLICATION TO ELIMINATE TEMPORARY RATE ADJUSTMENT PAGE 2
Plant, in Order No. 29484 dated April 28, 2004 in Case No. A VU-04-2. As proposed by the
Company and approved by the Commission, the customer portion of the gain on the sale
Skookumchuck was deferred and added to the deferred gain on the Centralia Power Plant.
The customer portion of the net of tax Centralia gain amounted to approximately $7 507 000
and the customer portion ofthe net oftax Skookumchuck gain amounted to approximately $154 000.
The Company expects that the total amount of the net of tax gains of approximately $7 661 000, and
the benefit of a carrying cost on the unamortized gains, will have been passed on to customers at the
end of October 2006. With a termination date of November 1 2006, the Centralia gain credits will
have been in place for a period of six years and three months, which is shorter than the original eight-
year pass-through period. The shorter pass-through period is due primarily to having Potlatch
receive the gain credit applicable to Schedule 25 beginning January 1 , 2002. In addition, customer
loads have grown since the gain credits were made effective on August 1 , 2000 , also resulting in a
shorter pass-through period.
There will be a small under-refunded or over-refunded balance when the Centralia gain
credits are terminated on November 1 2006. Based on forecasted loads for September and October
2006, the result will be an over-refund of approximately $18 000 before tax, $12 000 net of tax. The
Company proposes that any under-refunded or over-refunded balance be transferred to the deferred
Power Cost Adjustment (PCA) deferral account as well as the remaining balance of associated
deferred federal income tax being transferred to the PCA deferred tax account.
III. IMPACT OF ELIMINATING TEMPORARY RATE CREDITS
The Company proposes that the Centralia gain temporary rate credits be eliminated effective
November 1 , 2006. The elimination of the temporary rate credits results in an overall increase in
A VISTA'S APPLICATION TO ELIMINATE TEMPORARY RATE ADJUSTMENT PAGE 3
annual revenue of approximately $2.5 million. Elimination ofthe temporary rate credits will have no
effect on Avista s net income. A residential customer using 1 000 kilowatt-hours per month will see
an increase of $0.91 or 1.45% in their monthly bill due to the elimination of the temporary rate
credit. The proposed simultaneous increase to the rate credit applicable to residential and small farm
customers to pass through increased residential exchange benefits it will receive from the Bonneville
Power Administration will amount to a decrease of $0.47 or 0.75% per month for a residential
customer using 1 000 kilowatt-hours per month. The net increase to a residential customer using
I ,000 kilowatt-hours per month from the elimination of the Centralia credit and the increase in the
residential and small farm exchange credit amounts to $0.44 or 0.70%.
IV. REQUEST FOR RELIEF
The Company respectfully requests an order from the Commission approving the elimination
or zeroing-out of the Centralia gain rate credits contained on Temporary Rate Adjustment Schedule
, effective November 1 2006. Any under-refunded or over-refunded balance ofthe Centralia gain
would be transferred to the PCA deferral account and PCA deferred tax account. The Company
requests that this filing be processed under the Commission s Modified Procedure rules. Due to the
straightforward nature of the filing, the Company does not believe that a hearing is required.
Dated at Spokane, Washington this 13th day of September 2006.
A VISTA CORPORATION
C/ ~:f'-
David f.Meyer
Vice President and Chief Counsel of
Regulatory and Governmental Affairs
A VISTA'S APPLICATION TO ELIMINATE TEMPORARY RATE ADmSTMENT PAGE 4
VERIFICATION
STATE 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.
/-!I
SIGNED AND SWORN to before me this 13th day of September 2006, by David J. Meyer.
NOTARY PO IC in and for the State of
Washington, residing at Spokane.
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A VISTA'S APPLICATION TO ELIMINATE TEMPORARY RATE ADmSTMENT PAGE 5