20071204order_no_30471.pdf

Office ofthe Secretary
Service Date
December 4, 2007
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF A VISTA CORPORATION FOR
AUTHORITY TO IMPLEMENT A PILOT
PROGRAM FOR REMOTE DISCONNECTS
AND RECONNECTS ORDER NO. 30471
CASE NO. A VU-07-
On August 31 , 2007, A vista Corporation filed an Application seeking approval to
implement a one-year pilot program for the remote disconnection and reconnection of customers
to its system. The Company also requested a limited waiver of Utility Customer Relations Rule
311.03 and .04 (IDAPA 31.21.01.03 and .04) related to the final customer notification prior to
disconnection. The Company requested that its Application be processed by Modified
Procedure. IDAPA 31.01.01.201-.204.
On September 19, 2007, the Commission issued a Notice of Application and Notice
of Modified Procedure, establishing a deadline for the submission of comments and/or protests.
Commission Staff filed comments supporting the Company s Application. The American
Association of Retired People, Idaho (AARP) filed comments opposing the Company
Application. Likewise, the Community Action Partnership Association of Idaho (CAP AI) filed
comments opposing approval of the Company s Application as well as the Commission s use of
Modified Procedure. Additionally, CAP AI requested that the Commission convene a technical
hearing and order a workshop regarding the Company s proposal.
The Commission, with this Order, defers judgment on the Company s Application
and orders the parties to conduct workshops to further refine and develop the details of the
program, as more fully set forth below.
THE COMPANY'S APPLICATION
The Company proposed to install approximately 250 remote disconnect coHars which
would utilize Power Line Carrier (PLC) as the communication protocol in rural areas and
approximately 350 wireless meter devices for use in urban areas. The devices would allow for
the remote enabling and disabling of electric service from A vista s office. According to the
Company s Application, customers selected for the pilot would include customers with 200 amp
services that either have had multiple disconnects, are located in rural areas, or otherwise occupy
ORDER NO. 30471
premises where the A vista employee may be "at risk" for manually performing disconnects
and/or reconnects.
The Company stated that the anticipated benefits of remote disconnect and reconnect
capability include: (1) reducing operating and maintenance expenses related to multiple
disconnections and reconnections for urban and rural accounts; (2) productivity gains of
employees by eliminating multiple trips to customer homes for collections; (3) enhancing
employee safety; (4) quicker response time to reconnect service leading to increased customer
satisfaction; and (5) recognizing a reduction in bill defaults and write-offs by encouraging
prompt consumer payment over time. A vista proposes to report on the following at the
conclusion of the one-year pilot program: (1) number of disconnect devices installed; (2) reason
for installation; (3) utilization of the disconnect devices after installation; and (4) costs together
with realized savings.
COMMENTS OF AARP IDAHO
AARP's comments opposed approval of the pilot program and asked the
Commission to deny the Company s Application. AARP Comments at 1. AARP stated that the
Company s Application is deficient, the Company has not provided sufficient information
regarding the pilot such as costs to the ratepayers, and that the proposal is poor public policy and
increases risks to health and safety.
AARP urged the Commission to deny the proposed pilot because Avista
Application is deficient. Id AARP argued that A vista has provided no cost information.
AARP stated that A vista did not disclose how it intends to recover the costs of the devices, and
whether shareholders will cover the costs of the pilot, or if the Company will ask the
Commission for ratepayers to cover the expense through rates, through a surcharge to all
customers, or a surcharge on pilot participants. Id AARP stated that for this reason alone the
pilot should be denied. Id Additionally, AARP argued that Avista has not provided adequate
information regarding how pilot participants will be chosen, and that there is no customer
education component to the pilot. Id at 2.
AARP also urged the Commission to deny the proposed pilot because it is bad public
policy. Id. at 3. AARP argued that maintaining service is a health and safety issue, and that
remote disconnection may raise the number of disconnections, impacting health and safety.
AARP stated that faster and easier disconnection of service has severe health and safety
ORDER NO. 30471
implications citing extreme weather, and particularly high temperatures, as putting the health and
safety of more households at risk. Id AARP stated that there is currently some percentage of
accounts which are slated for disconnection that are not actually disconnected because the
customer makes payment at the time the utility employee comes to the premises to perform the
disconnection, and without this last opportunity more households will lose service and be at risk.
Id They also argued that elimination of the premise visit prior to shutoff removes the
opportunity for the utility employee to observe signs of a health or safety danger, such as a
customer using a respirator or other medically necessary devices requiring electric service. Id
4. AARP also argued that the terms of the pilot are skewed against the customer because they do
not include a waiver of the reconnection fee and do not propose any measurement and evaluation
to consider the impact of the program on customers.
Finally, AARP stated that if the Commission were to approve the pilot it should place
a number of conditions that are in the public interest upon the pilot prior to proceeding.
Those conditions are: (1) shareholders should be required to cover the costs of the pilot; (2)
costs of the meters and installation should be disclosed; (3) criteria for selecting customers for
the pilot should be more detailed and disclosed; (4) vulnerable customers, including low-income
seniors, ill and disabled, and families with young children should not be included; (5) all pilot
participants should have telephones; (6) the pilot should use representative sampling; (7)
reconnection fees should be waived, and reconnection should occur within one hour of payment;
(8) a customer education program should be required; (9) notices should emphasize that
disconnection will be done remotely; (10) telephone notice should be done by a live operator
able to take electronic payment and offer bill payment-plans; (11) measurement and evaluation
should include impact on customers. Id at 4-
COMMENTS OF CAP AI
CAPAI opposed the approval of the Company s Application, objected to the
Commission s use of Modified Procedure, and requested that the Commission "conduct a brief
technical hearing in this matter." CAP AI Comments at 1. CAP AI stated that the Company was
clearly proposing the program because it believed it would benefit shareholders. Id. CAP AI
stated that while not sending a representative to personally attempt collection from the customer
could decrease costs for the Company, the proposed pilot not only fails to offer a quid pro quo to
customers, but also diminishes the level of service currently being provided. Id.
ORDER NO. 30471
CAP AI contends that the number of disconnects will "increase dramatically" if the
pilot is approved, as the Company will no longer be limited by the number of available field staff
and vehicles. Id. CAP AI stated that by losing the "premise visits" the customers lose the benefit
of a "health and human safety check that the company field representatives frequently provide.
/d. CAPAI also expressed concern for the "very low-income customers residing in the
Company service territory who might not have the benefit of either a telephone or
transportation./d. CAP AI stated that currently 15% of potential disconnections avoid being
disconnected by paying at the door when the Company is there to disconnect them, and that
presumably" this is at least partially due to an inability to arrange transportation to the nearest
pay station making it more difficult for them to avoid disconnection or get reconnected. Id. at 1-
2. CAP AI recommended that the existing notice requirement remain unchanged. /d. at 2.
CAP AI stated that it was "disturbed" that remote disconnections and even reconnections takes
away a vital communication connection between low-income customers and the Company. Id.
CAP AI also stated that it was "concerned" about: (1) the precedent that the program
would set for other utilities that do not have the same customer service record that A vista has; (2)
that approval of the program "could easily lead to time-of-use issued and their disproportionate
effect on low-income customers ; and (3) it is concerned about the cost of the program and how
those costs will be allocated, and ultimately if the program is to reduce costs, why should there
be cost recovery at all. Id.
CAP AI closed its comments by stating that as an alternative to conducting a full
technical hearing the Commission defer approval of the program "for a limited, reasonable
period of time for all interested persons to express their concerns and attempt to work out
reasonable solutions with the company.Id. CAP AI suggested that the Commission also order a
workshop, "to include any interested person and possibly avoid regretting mistakes that could
have been corrected at the commencement of the pilot period.Id.
COMMENTS OF COMMISSION STAFF
Staff supported approval of the Company s Application with certain conditions.
Staff Comments at 2. Staff stated generally that the Commission has encouraged utilities to
implement "smart meter" technology, and as with any new technology, evaluation and
adjustments are necessary. Id Staff stated the proposed pilot would provide an opportunity to
determine the costs and benefits of remote connection and disconnection, test the equipment, and
ORDER NO. 30471
perhaps more importantly, allow all interested parties to evaluate the impact of such a program
on customers.
Staff was concerned with the Company s selection criteria for inclusion of customers
in the pilot program. The selection criteria was stated as customers with multiple disconnections
location in a rural area, or the customer occupies a premise where an A vista employee may be at
risk. Staff worked with the Company on its definitions of "multiple disconnections
" "
rural
area " and "at risk.Id.
Staff supported the Company s request for a limited waiver of Utility Customer
Relations Rule 311.03 and .04 relating to an actual visit by a company representative to the
premises prior to disconnection, and that would no longer take place with remote disconnections.
Id. at 4. Currently, the first disconnection notice is sent to the customer at least seven calendar
days before the proposed date of disconnection (Rule 304., Utility Customer Relations Rules
(UCRR)). Id. at 3. A final (second) notice is sent at least three days before the proposed date of
disconnection. Id.A call must be made to the customer at least 24 hours before actual
disconnection (Rule 304., UCRR). Id. at 3-4. All notices must provide information on steps
the customer may take to avoid disconnection. Id. at 4. Under the pilot, the Company intends to
continue providing these written and oral notices. Id. The day service is disconnected, the utility
is required to knock on the door to give the customer a final opportunity to pay the amount
required to prevent disconnection (Rule 311., UCRR). Id. If no one is at the premises at that
time, the employee must leave a notice advising the customer that service has been disconnected
and what steps must be taken to get service reconnected (Rule 311., UCRR). Id.
The Company has proposed a special notice that would be given to customers or left
at the premises when the remote connect/disconnect equipment is initially installed. Id. The
notice will advise the customer that the device has been installed and explain how that will
change the disconnection and reconnection procedure from that point forward. Id. The notice
also requests updated customer contact information so that the Company can call the customer
immediately prior to disconnection.Id.The notice provided to the customer includes
information on action the customer needs to take after the Company restores service, i., push
the reset button on the meter. Id. at 4-5. The customer will be given the same information when
the customer contacts the Company to request reconnection. Id. at 5. Staff supports this special
notice, but believes the text of the draft/special notice could be rewritten to provide greater
ORDER NO. 30471
assistance to program participants. Id. Staff recommended the Company work with Staff in
preparing this special notice for customers selected for the pilot program. Id. In particular, Staff
believes the notice should encourage customers to contact the Company if there are any
questions or concerns or if there are reasons why the customer would not be able to reset the
meter. Id.
Staff reported the evaluation effort identified by the Company in its Application
focuses on the hardware used in the pilot program and a financial costlbenefit analysis. Id. at 6.
The Company does not mention any effort to evaluate the impact upon customers and customer
payment behavior. Id. A vista has expressed a willingness to work with Staff and other
interested parties to develop an evaluation plan designed to make meaningful analysis of
customer impacts possible. Id.
Staff reported the advantage of the pilot program is the ability of the Company to
restore service within minutes, 7 days a week, 24 hours a day, once the customer has satisfied all
the conditions required to restore service. Id. Normally, it can take up to several hours to restore
service, taking into account scheduling and drive time to the customer s premises.Id.
Customers who request reconnection outside of Avista s normal business hours (8 a.m. to 7 p.
weekdays and 8 a.m. to 4 p.m. on weekends and holidays) must wait until the following day to
be reconnected. Id. For these customers, remote reconnection will be a major benefit, since
service will be restored much more quickly. Id.
Staff stated the Company estimates the cost of the pilot to be $104 000. Id. Staff
noted that A vista is already in the process of installing metering equipment under its Advanced
Meter Reading (AMR) program to enable the Company to read meters remotely. Id. The same
technology used to read meters remotely can be used to connect and disconnect service remotely.
Id. Therefore, the Company anticipates that it will not necessarily incur additional equipment
cost for every customer selected for the pilot. Id. To the extent that is true, it will reduce the
overall cost of the pilot program. Id.
Staff recommended the Commission approve the proposed pilot program and grant a
limited waiver of Rule 311.03 and .04 (IDAP A 31.21.01.311.03 and .04) with respect to
customers selected for the pilot under the following conditions: (1) the Company modify its
selection criteria to define "multiple disconnections" as two or more disconnections within the
past 12 months and change its location focus to customers whose premises are in remote areas;
ORDER NO. 30471
(2) direct the Company to work with Staff on preparing its special notice for customers selected
for participation in the pilot program; and (3) direct the Company to work with Staff and other
interested parties to prepare a plan for evaluation that includes the pilot's impact on customers
and customer behavior as well as the technological and financial aspects of the program. Id. at 7.
FIND IN GS/D ISCUSSI
We have reviewed the record in this case, including the Application and comments.
Under Modified Procedure, if protests, supports, or comments are filed within the deadline, the
Commission must consider them and may set the matter for hearing or may decide the matter and
issue its Order on the basis of the written positions before it. Procedural Rule 204, IDAP A
31.01.01.204. Persons desiring a hearing must specifically request a hearing in their written
protests or comments. Rule 203, IDAPA 31.01.01.203.
CAP AI filed a protest to the use of Modified Procedure and specifically requested a
brief technical hearing" in its comments. CAP AI Comments at 1. CAP AI also proposed as an
alterative that the Commission defer approval of the program, convene a workshop, and allow a
reasonable period of time for all interested to attempt to work out an agreement. Id. at 2. AARP
did not protest the use of Modified Procedure, but urged the Commission to deny the
Application. AARP Comments at 1. AARP also stated that, should the Commission be inclined
to approve the program, that several conditions be placed upon the pilot to protect the p~blic
interest. Id. at 4-5. Finally, Commission Staff supported approval of the Company
Application, but also recommended changes and/or refinements to the definitions , notice, and
evaluation process of the pilot. Staff Comments at 7.
We continue to find that the public interest does not require a hearing to consider the
issues presented in this case and that Modified Procedure is appropriate. IDAPA 31.01.01.204.
The Commission has jurisdiction over A vista, its Application for authority to implement the
proposed pilot program, and the issues involved in this case by virtue of Title 61 , Idaho Code
including Idaho Code 99 61-129, 61-118, 61-119, 61-301 , 31-302, 61-303 , 61-307 , and 61-501
and the Commission s Rules of Procedure, IDAPA 31.01.01.000 et seq.
The Commission has long supported the implementation of advanced metering
technology. See Order No. 30229 at 7-10 (discussing implementation of "smart metering
technology and programs for Idaho Power, Rocky Mountain Power, and A vista in Idaho). The
remote disconnect and reconnect equipment proposed for use and evaluation in this pilot is a
ORDER NO. 30471
functional part of Avista s advanced metering deployment in Idaho, and we find value in the
continued and proper evaluation of this technology.
Based upon our review of the record in this case, we find that the details of the pilot
program need further development and refinement. We order the parties to conduct workshops
to further refine and develop the details of the program. The workshops will be scheduled under
a separate Notice. No later than 30 days after the last workshop the Company shall submit a
supplement to its Application incorporating the refinements to the program and reporting any
consensus of the parties from the workshops. This supplemental filing should be served on all
participants of the workshops, as well as any other interested person in the same manner as the
initial Application. Once the supplemental filing is made, the Commission will commence a 14-
day comment period for any interested person to submit comments relevant to the supplemental
material and the Commission s decision.
The parties should address such issues at the workshops as the various definitions
and parameters of the pilot, costs of the pilot including reconnection fees and ultimate cost
recovery/savings, and the plan for evaluation of the pilot. Discussion should include, but not be
limited to: (1) the criteria for selecting customers for inclusion in the program; (2) the
distinction(s) between urban and rural customers and any links with the Company s AMR
distribution; (3) the notice, any special notice, and any customer education for those selected for
participation; (4) the plan for evaluation of the pilot, including both technological and customer
impacts; (5) capital costs, cost recovery, reconnection fees, cost savings; and (6) the public
interest issues surrounding the abandonment of the final, in-person home visit and opportunity to
pay at the door" prior to disconnection.
ORDER
IT IS HEREBY ORDERED that CAPAI's request for a technical hearing is denied.
CAP AI's request for the Commission to defer approval of the pilot, and to order workshops to
allow the parties to further refine and develop the details of the pilot program is granted.
IT IS FURTHER ORDERED that the parties shall conduct two workshops, one in
Coeur d' Alene and one in Lewiston, for the purposes stated above. These workshops shall be
scheduled by a separate Notice issued by the Commission Secretary.
IT IS FURTHER ORDERED that the Company shall submit, no later than 30 days
after the last workshop, a supplement to its Application incorporating the parties' input
ORDER NO. 30471
refinements, recommendations, and any consensus from the workshops. The Company shall
serve the supplemental filing upon all participants of the workshops, as well as any other
interested person in the same manner as the initial Application. A 14-day comment period shall
commence with the filing of the supplemental material with the Commission.
IT IS FURTHER ORDERED that the Commission hereby defers judgment on the
Company s Application pending the supplemental filing of the parties and comment period
following the workshops.
DONE by Order ofthe Idaho Public Utilities Commission at Boise, Idaho this if-ofI\
D~c.(:Mhc.(
day of No.c:mbcr 2007.
MARSHA H. SMITH, COMMISSIONER
ATTEST:
Je ~n) D. Jewell
Co'rtlmission Secretary
O:A VU-07-09 dw2
ORDER NO. 30471