20080728Application.pdf

Avista Corp.
1411 East Mission P.O. Box 3727
Spokane. Washington 99220-0500
Telephone [phone]
Toll Free 800-727-9170
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Corp.
July 25, 2008
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VIA OVERNGHT MAI
State of Idaho
Idaho Public Utilities Commission
472 W. Washington St.
Boise, ID 83702-5983
Attention: Ms. Jean Jewell, Secretar
Case No. A VU-E-08-os
Power Cost Adjustment (PCA) Anual
Rate Adjustment Filng of A vista Corporation
Enclosed is Avista's Power Cost Adjustment (PCA) annual rate adjustment filing. The filing
consists of an original and seven copies of Avista's Application and nine copies of prefied
testimony and exhibits. Also enclosed are three copies of supporting workpapers and
documentation, including Monthly PCA reports for the months of July 2007 through June 2008.
Also enclosed is a certificate of service, three copies of a customer notice, and three copies of a
press release. A computer readable copy of the testimonies, exhibits, and workpapers, required
under Rule 231.05, are included on an enclosed compact disk.
The Company is requesting that the Commission issue an order approving recovery of power
costs deferred through June 30, 2008, and approving a PCA surcharge of 0.610~ per kilowatt-
hour to be effective October 1, 2008. The proposed surcharge wil replace the existing surcharge,
which expires on September 30, 2008. The proposed surcharge is about $21.7 milion, which is
approximately $12.2 milion more than the existing surcharge of about $9.5 milion. The
requested revenue increase of $12.2 milion results in an overall 5.94 percent increase. The
actual percentage increase for an individual customer wil depend on the rate schedule that the
customer receives service under and on how much energy a customer uses.
Under the Company's proposal, the surcharge rate for residential customers wil increase from
0.267~ per kilowatt-hour to 0.610~ per kilowatt-hour, or an increase of0.343~ per kilowatt-hour.
For an average residential customer using 1,000 kilowatt-hours per month, the monthly increase
wil be $3.43. Under present rates, a residential bil for 1,000 kilowatt-hours amounts to $63.44.
With the proposed surcharge in place the monthly bil would be $66.87, or about 5.4% higher
than the bil under present rates.
Please note that A vista has deemed certain supporting documents to be classified as
CONFIDENTIA, rendering these documents exempt from public inspection, examination and
copying pursuant to Sections 9-340A through 9-340F ofthe Idaho Code. Avista believes that the
identified CONFIDENTIA supporting documents contain valuable commercial information.
As suoh, A vista is submitting a separate electronic CD containing the electronic form of the
CONFIDENTIA supporting documents, in compliance with Idaho rule 67.01.b. Please adhere
to Avista's request by treating those supporting documents identified as CONFIDENTIA by not
disclosing to any pary outside of this proceeding without the specific wrtten permission of
Avista.
Please direct any questions regarding this filing to Ron McKenzie at [phone].
Sincerely,~ ~..i.
Kelly Norwood
Vice President, State and Federal Regulation
Enclosure
RM
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that I have served Avista Corporation's Power Cost
Adjustment (PCA) Annual Rate Adjustment Filing by mailing a copy thereof,
postage prepaid, to the following:
Ms Jean D Jewell, Secretary
Idaho Public Utilities Commission
472 W. Washington St.
Boise, ID 83702-5983
Pamela Mull
Vice President & General Counsel
Potlatch Corporation
601 W. First Ave.
Suite 1600
Spokane, WA 99201
Howard Ray
Technical Services Manager
Potlatch Corporation
803 Mil Road
PO Box 1126
Lewiston, ID 83501-1126
Dated at Spokane, Washington this 25th day of July 2008.
p~
Rates Coordinator
1 David J. Meyer
2 Vice President and Chief Counsel of
3 Regulatory and Governental Affairs
4 A vista Corporation
5 1411 E. Mission Avenue
6 P. O. Box 3727
7 Spokane, Washington 99220
8 Phone: [phone], Fax: [phone]
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9 BEFORE THE IDAHO PUBLIC UTILITIES COMMSSION
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) CASE NO. A VU-E-08-0S
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IN THE MATTER OF THE POWER COST
ADmSTMENT (PCA) ANAL RATE
ADmSTMENT FILING OF A VISTA
CORPORATION
I. INTRODUCTION
16 Avista Corporation, doing business as Avista Utilities (hereinafter Avista or Company), at
17 1411 East Mission Avenue, Spokane, Washington, respectfully files its Power Cost Adjustment
18 (PCA) annual rate adjustment filing in the above referenced case. The Company requests the
19 Commission issue an order approving recovery of power costs deferred for the period July 1, 2007
20 through June 30, 2008, and approving a PCA surcharge of 0.61 O~ per kilowatt-hour to be effective
21 October 1, 2008. The Company requests that this filing be processed under the Commission's
22 modified procedure rules.
23 Communications in reference to this Application should be addressed to:
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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 Governental Affairs
A vista Corporation
1411 E. Mission Avenue
Spokane, Washington 99220
Phone: [phone]
Fax: [phone]
32 II. BACKGROUND
AVISTA'S peA ANNAL RATE ADJUSTMENT FILING PAGE 1
1 Avista's PCA is used to track changes in revenues and costs associated with variations in
2 hydroelectric generation, secondary prices, thermal fuel costs, and changes in power contract
3 revenues and expenses. A vista's existing PCA methodology and method of recovery were
4 approved in Case No. A VU-E-07-01 by Order No. 30361 dated June 29,2007. In that case the
5 Commission approved a change in the PCA methodology from a trigger and cap mechanism to a
6 single anual PCA rate adjustment filing requirement. The Commission approved the following
7 procedural schedule for administering the anual PCA filings:
8 August 1 Company filing for prior July - June deferral period
9 September 1 Review and comments by Staff and other interested parties
10 October 1 Commission Order and effective date of PC A rate adjustment
11 The Commission also approved a change in the method of PCA deferral recovery from a uniform
12 percentage basis to a uniform cents per kilowatt-hour basis effective with the October 1,2007 PCA
13 rate change. On July 31, 2007 Avista filed its first PCA annual rate filing pursuant to the
14 modifications and procedural schedule approved by Order No. 30361. Order No. 30429 in Case No.
15 A VU-E-07-07 dated September 14,2007 approved the existing PCA rate surcharge ofO.267~ per
16 kilowatt-hour effective for the period October 1, 2007 through September 30, 2008.
17 III. DEFERRLS - JULY 1, 2007 THROUGH JUNE 30, 2008
18 The amount of power cost deferrals for the perod July 1, 2007 through June 30, 2008 is
19 shown below, as well as interest for the same period. Mr. Johnson's testimony provides an
20 explanation of the factors causing the deferral entries for the period.
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Deferrals (July 2007 - June 2008)
Interest
Balance at June 30, 2008
$20,348,374
618,541
$20,966,915
AVISTA'S peA ANNAL RATE ADJUSTMENT FILING PAGE 2
1 Monthly reports have been filed with the Commission regarding actual PCA deferral
2 entries to date. To facilitate Staffs review, additional copies of those reports for the months of
3 July 2007 through June 2008 have been included with this filing and have also been provided to
4 Potlatch Corporation.
5 iv. PROPOSED SURCHARGE TO BE EFFECTIVE OCTOBER 1, 2008
6 The Company is proposing a uniform cents per kilowatt-hour PCA surcharge ofO.610~ to
7 be effective October 1, 2008. The existing PCA surcharge of 0.267 ~ expires on September 30,
8 2008. Attached as Exhibit "A" is a copy of the proposed tariff, Schedule 66 (Tenth Revision),
9 which contains the proposed PCA surcharge rate. Also included in Exhibit "A" is a tariff sheet
10 that shows the proposed changes to Schedule 66 (Ninth Revision) by the use of strkeouts and
11 underlining. Page 2 of Mr. McKenzie's Exhibit No. _ (RLM-l) shows the calculation of the
12 proposed surcharge. The proposed surcharge is designed to recover the deferrals and interest
13 during the recovery period of October 1, 2008 through September 30, 2009.
14 Since the proposed surcharge is spread on a uniform cents per kilowatt-hour basis, the
15 resulting percentage increases var by rate schedule. Page 1 of Mr. McKenzie's Exhibit No. _
16 (RLM -1) shows the effect of the proposed PCA surcharge by rate schedule. The proposed surcharge
17 is approximately $21.7 milion, which is approximately $12.2 milion more than the existing
18 surcharge of approximately $9.5 milion. Column G) on page 1 of Exhibit No. _ (RLM-1) shows
19 the breakdown of the $12.2 milion increase over the existing surcharge by rate schedule and column
20 (k) shows the resulting percentage increases by rate schedule.
21 Under the Company's proposal, the surcharge rate for residential customers wil increase
22 from 0.267~ per kilowatt-hour to 0.610~ per kilowatt-hour, or an increase ofO.343~ per kilowatt-
AVISTA'S peA ANNAL RATE ADJUSTMENT FILING PAGE 3
1 hour. For an average residential customer using 1,000 kilowatt-hours per month, the monthly
2 increase wil be $3.43. Under present rates, a residential bil for 1,000 kilowatt-hours amounts to
3 $63.44. With the proposed surcharge in place the monthly bil would be $66.87, or about 5.4%
4 higher than the bil under present rates.
5 V. REQUEST FOR RELIEF
6 The Company requests the Commission issue an order approving recovery of power costs
7 deferred through June 30, 2008, and approving a PCA surcharge of 0.61 O~ per kilowatt-hour to be
8 effective October 1, 2008. The Company requests that the matter be processed under the
9 Commission's Modified Procedure rules through the use of written comments.
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11 Dated at Spokane, Washington this 25th day of July 2008.
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13 AVISTA CORPORATION
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BY 7a ti",~
Kelly No ood
Vice President
State and Federal Regulation
AVISTA'S peA ANNAL RATE ADJUSTMENT FILING PAGE 4
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VERIICATION
STATE OF WASHINGTON)
)County of Spokane )
Kelly Norwood, being first duly sworn on oath, deposes and says: That he is the Vice
President of State and Federal Regulation of Avista Utilities and makes this verification for and on
behalf of A vista Corporation, being thereto duly authorized;
That he has read the foregoing filing, knows the contents thereof, and believes the same to be
true.
7~ ¿,w-
SIGNED AN SWORN to before me this 25th day of July 2008, by Kelly Norwood.
NOTAR UBLIC in and for the State of
Washington, residing at Spokane.
Commission Expires: /tJ /.R7' M%, . ¡
AVISTA'S peA ANNAL RATE ADJUSTMENT FILING PAGES
Case No. A VU-E-08- oS-
Exhibit "A"
I.P.U.C. NO.28
Tenth Revision Sheet 66
Canceling
Ninth Revision Sheet 66
AVISTA CORPORATION
d/b/a Avista Utilities
66
SCHEDULE 66
TEMPORARY POWER COST ADJUSTMENT - IDAHO
APPLICABLE:
To Customers in the State of Idaho where the Company has electric service
available. This Power Cost 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 Rate Adjustment is
designed to recover or rebate a portion of the difference between actual and allowed
net power supply costs.
MONTHLY RATE:
The energy charges of electric Schedules 1, 11, 12, 21, 22, 25, 25P, 31, and 32
are to be increased by 0.61 Orl per kilowatt-hour in all blocks of these rate schedules.
Flat rate charges for Company-owned or Customer-owned Street Lighting and
Area Lighting Service, Schedules 41-49, are to be increased by 0.610rl per kilowatt-
hour times the monthly usages of the various light sizes and types on these schedules.
SPECIAL TERMS AND CONDITIONS:
The rates set forth under this Schedule are subject to periodic review and
adjustment by the IPUC based on the actual balance of deferred power costs.
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 25, 2008 Effective October 1, 2008
Issued by Avista Utilities
By ~ ~_ u: O. Norwoo - Vice PrèSident, State & Federal Regulation
I.P.U.C. NO.28
Ninth Revision Sheet 66
Canceling
Eighth Revision Sheet 66
AVISTA CORPORATION
d/b/a Avista Utilities
66
SCHEDULE 66
TEMPORARY POWER COST ADJUSTMENT - IDAHO
APPLICABLE:
To Customers in the State of Idaho where the Company has electric service
available. This Power Cost 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 Rate Adjustment is
designed to recover or rebate a portion of the difference between actual and allowed
net power supply costs.
MONTHLY RATE:
The energy charges of electric Schedules 1, 11, 12, 21, 22, 25, 25P, 31, and 32
are to be increased by fJø per kilowatt-hour in all blocks of these rate schedules.
0.610
Flat rate charges for Company-owned or Customer-owned Street Lighting and
Area Lighting Service, Schedules 41-49, are to be increased by fJø per kilowatt-
hour times the monthly usages of the various light sizes and types on these schedules.
0.610
SPECIAL TERMS AND CONDITIONS:
The rates set forth under this Schedule are subject to periodic review and
adjustment by the IPUC based on the actual balance of deferred power costs.
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 30, 2007 Effective October 1,2007
Issued by Avista Utilities
By Kelly O. Norwood - Vice President, State & Federal Regulation