20070706Decision Memo.pdf

DECISION MEMORANDUM
TO:CO MMISSI 0 NER KJELLAND ER
CO MMISSI 0 NER SMITH
CO MMISSI 0 NER RED FO RD
COMMISSION SECRETARY
COMMISSION STAFF
FROM:DON HOWELL
DATE:JUNE 26, 2007
SUBJECT:APPLICATION FOR APPROVAL OF A SERVICE TERRITORY
AGREEMENT FILED BY VISTA UTILITIES AND NORTHERN
LIGHTS, CASE NO. A VU-07-
On June 20, 2007, Avista Corporation dba Avista Utilities filed an Application
seeking the Commission s approval of a contract between Avista and Northern Lights to allocate
service territories and future consumers. Northern Lights is an electric cooperative operating in
northern Idaho. The parties
' "
Customer Allocation Agreement" is last dated May 23, 2007. The
Agreement was executed pursuant to the provisions of the Electric Supplier Stabilization Act
(ESSA) and specifically Idaho Code ~ 61-333(1).
THE APPLICATION
A vista and Northern Lights propose to allocate service territory in a 15-10t residential
subdivision known as Spring Haven in Sandpoint, Idaho. The subdivision is being developed by
Jerry VanOoyen and Mike Dougherty. Both electric suppliers have existing facilities that can
serve the initial 15 lots. The parties have agreed that Northern Lights will serve the initial 15 lots
because its facilities are closer to the majority of lots. Agreement at ~ 1. A plat of the
subdivision is attached to the Agreement.
The parties assert that the allocation of service territory will avoid duplication of
facilities, avoid dispute between the parties, and provide consumers with the best possible
service. The Agreement recognizes that A vista does not give up "its rights to serve future phases
of the Development or adjoining plats thereto, and (the Agreement) may not be used to
determine which supplier may serve other new customers. Id. at ~ 3.
DECISION MEMORANDUM
The Agreement is also endorsed by Jerry VanOoyen, the owner-developer of the
property. The developers agreed to comply and be bound by the Agreement. Given the
agreement of the parties, they recommend that the Application be processed under Modified
Procedure. The parties also acknowledge that the Agreement is subject to the Commission
approval. Id. at ~ 4.
THE ESSA
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
Avista and Northern Lights 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 ~ 61-333A(I). As set out in Idaho
Code ~ 61-332(2), the purposes of the ESSA are to: discourage duplication of facilities; prohibit
pirating" of consumers; stabilize service territories and consumers; and promote harmony
between electric suppliers.
ST AFF RECOMMENDATION
Given the agreement of the parties and the consent of the developers, Staff
recommends that this Application be processed under Modified Procedure.
COMMISSION DECISION
Does the Commission concur that this matter should be processed under Modified
Procedure?
Don Howell
blsfM:A VU-O7-05 dh
DECISION MEMORANDUM