20090515final_order_no_30811.pdf

Office of the Secretary
Service Date
May 15 2009
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF ANNUAL REVISIONS
TO A VISTA CORPORATION'S ELECTRIC
SERVICE SCHEDULE 51 REGARDING LINE
EXTENSIONS, CONVERSIONS AND
RELOCATIONS.
CASE NO. A VU-09-
ORDER NO. 30811
On March 31 , 2009, Avista Corporation filed Tariff Advice No. 09-01-E proposing
various revisions to its tariff Schedule 51 that sets out the Company s line extension, conversion
and relocation charges. The purpose of this annual filing is to update the Company s line
extension charges for electric service to reflect actual costs incurred in the previous calendar
year. The Company requested an effective date of May 18 2009.
On April 22, 2009, the Commission issued a Notice of Modified Procedure inviting
written comments about Avista s proposed changes to Schedule 51.Commission Staff
submitted the only comments in response to the Notice. After reviewing the tariff schedule and
the Staff comments, the Commission approves Tariff Advice No. 09-01-E and the proposed
changes to Schedule 51.
BACKGROUND
In November 2000, the Commission issued Order No. 28562 directing Avista to
annually update its Schedule 51 charges on or before April 1 each year. The purpose of the
annual filing is to reset the Company s line extension charges for electric service to reflect the
average actual costs incurred in the previous calendar year. Order No. 28562 at 3. The
Commission observed that the annual update to line extension costs appropriately assigns
connection costs to new customers and avoids putting "increased (upward) pressure on the rates
for all customers.Id. at 7.
In Tariff Advice No. 09-01-, the Company maintained that the cost for line
extensions increased from the prior year by approximately 10.11 %. The Company asserted the
fixed costs for an overhead primary service increased about 13 % during the past 12 months from
an average cost of $3 323 to $3 774. The fixed costs for an underground secondary also
increased about 13% from $175 to $199.
ORDER NO. 30811
ST AFF COMMENTS
After reviewing the supporting workpapers and the proposed tariff revisions, Staff
recommended the Commission approve the proposed changes in Tariff Advice No. 09-01-
Staff confirmed that many line extension costs have increased from the prior year. For example
Staff determined that the extension cost per lot for a residential development increased about
12% from $523 to $587. Staff Comments at 2. Combining the service costs for primary and
secondary connections and transformers, Staff reported that the total cost per lot for serving a
residential development increased by approximately 9% from $2 090 to $2 288. Id.
Staff did note that the costs of overhead transformers decreased by approximately 5%
and the costs of pad-mounted transformers decreased by about 11
%.
This is the first time in
recent years that Staff observed a decrease in transformer costs. Id.
Staff asserted the proposed changes to the line extension charges contained in
Schedule 51 were reasonable. Staff confirmed that the proposed costs reflect the actual costs
incurred by the Company in the previous calendar year. Updating line extension and relocation
costs annually results in "new customers bearing their fair share of extension costs, rather than
burdening existing ratepayers with the cost of serving new customers.Id.
COMMISSION FINDINGS
After reviewing the proposed amendments to Schedule 51 and the Staff comments
the Commission finds the proposed rate changes set out in Tariff Advice No. 09-01-E are just
and reasonable. We find the proposed changes to the Schedule 51 charges are based upon actual
costs incurred by the Company in the previous calendar year. These cost increases are consistent
with recent increases in the construction and materials industries. We further find that updating
line extension and relocation costs annually results in new customers bearing their fair share of
extension costs, rather than burdening existing ratepayers with the cost of serving new
customers. Consequently, we approve the proposed changes to Avista s Schedule 51.
ORDER
IT IS HEREBY ORDERED that Avista Corporation s proposed revisions to its
Schedule 51 (Line Extension, Conversion, and Relocation Schedule) are approved. The
revisions to Schedule 51 shall become effective on May 18 2009.
ORDER NO. 30811
THIS IS A FINAL ORDER. Any person interested in this Order (or in issues finally
decided by this Order) or in interlocutory Orders previously issued in this Case No. A VU-09-
03 may petition for reconsideration within twenty-one (21) days of the service date of this Order
with regard to any matter decided in this Order or in interlocutory Orders previously issued in
this case. Within seven (7) days after any person has petitioned for reconsideration, any other
person may cross-petition for reconsideration. See Idaho Code 9 61-626.
DONE by Order ofthe Idaho Public Utilities Commission at Boise, Idaho this /5""+-1-.
day of May 2009.
~cJ:. KEMPT N, P SIDENT
MARSHA H. SMITH, COMMISSIONER
~ ~"..
MAC A. REDF ISSIONER
ATTEST:
Commission Secretary
bls/O:A VU-09-03 dh2
ORDER NO. 30811