20110831notice_of_hearings_order_no_32348.pdf

Office of the Secretary
Service Date
August 31.2011
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )OF AVISTA CORPORATION DBA AVISTA )CASE NOS.AVU-E-11-O1
UTILITIES FOR AUTHORITY TO )AVU-G-ll-Ol
INCREASE ITS RATES AND CHARGES FOR )ELECTRIC AND NATURAL GAS SERVICE )NOTICE OF
IN IDAHO )PROPOSED SETTLEMENT
)
)NOTICE OF PUBLIC AND
)TECHNICAL HEARINGS
)
________________________________
ORDER NO.32348
On July 5,2011,Avista Corporation dba Avista Utilities filed an Application seeking
authority to increase the Company’s general rates for electric and natural gas service in Idaho by
averages of 3.7%and 2.7%,respectively.The Company requested an effective date of August 5,
2011,but the Commission suspended the proposed effective date for a period of thirty days plus
five months,as authorized by Idaho Code §61-622,or until such time as the Commission enters
an Order on the Company’s Application.Order No.32292.Petitions to Intervene,all of which
were granted,were filed by Clearwater Paper Corporation;Idaho Forest Group,LLC;
Community Action Partnership Association of Idaho (CAPAI);and the Idaho Conservation
League (ICL).The Commission Staff also participated as a party.
The parties scheduled a settlement conference in this matter on August 17,2011.All
parties attended and participated in the settlement conference,and the parties subsequently
agreed to resolve and settle all issues raised in this proceeding.On August 26,2011,the parties
filed a Motion to Approve the Settlement Stipulation.The Commission is not bound by any
settlement reached by the parties,although the parties represent that the settlement is in the
public interest and that all its terms and conditions are fair.just and reasonable.
NOTICE OF PROPOSED SETTLEMENT
The settlement provides that annual revenues for Avista’s electric and natural gas
service may increase by $2.8 million (1.1%)and $1.1 million (1.6%),respectively,effective
October 1,2011.By separate filings not a part of the Settlement Agreement,several other rate
adjustments are proposed to also take effect on October 1.2011.With respect to electric service,these
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF PUBLIC AND TECHNICAL HEARINGS
ORDER NO.32348 1
proposed adjustments include the following:an increase of $2.2 million for residential exchange credits
for residential and small farm customers (Schedule 59);a decrease of$15.5 million in Schedule 66 Power
Cost Adjustment (PCA)rates.In addition,an increase of $8.7 million for the previously-approved
adjustment for deferred state income taxes (DSIT)in Schedule 99,as part of the Settlement approved in
Case Nos.AVU-E-l0-01 and AVU-G-l0-01 will take effect on October 1,2011.After taking into
account the settlement-proposed increase of $2.8 million in electric general rate revenues,the net overall
reduction resulting from all of the proposed aforementioned adjustments,if approved as filed would total
approximately $6.2 million.The following table summarizes these proposed revenue adjustments:
Electric —October 1,2011 Revenue Change
Schedule 99 —DSIT Increase $8,698,844
Schedule 59 —Residential Exchange $(2,207,088)
Schedule 66 —PCA Decrease $(1 5,5 1 7,483)
GRC Rate Increase $2,800,000
Total Revenue Change $(6,225,757)
With respect to natural gas service,the following rate adjustments,by means of separate
filings,are proposed to take effect on October 1,2011:an increase of $0.8 million in Schedules 150/1 55
for Purchased Gas Costs (PGA);a decrease of $2.9 million in demand-side management (DSM)tariff
rider Schedule 191.In addition,an increase of $0.5 million for the previously-approved adjustment for
deferred state income taxes (DSIT)in Schedule 199,as part of the Settlement approved in Case Nos.
AVU-E-10-01 and AVU-G-10-0l will take effect on October 1,2011.After taking into account the
settlement-proposed increase of $1.1 million in natural gas general rate revenues,the net overall decrease
resulting from all of the proposed aforementioned adjustments,if approved as filed,would be $0.525
million.The following table summarizes these proposed revenue adjustments:
Natural Gas —October 1,2011 Revenue Change
Schedule 199 -DSIT Increase $470,423
Schedule 150/155 —PGA Increase $776,190
Schedule 191 —DSM Decrease $(2,871,236)
GRC Rate Increase $1,100,000
Total Revenue Change $(524,623)
Limitation on Effective Date of Any New Rates Established By Subsequent General Rate
Filing.As part of the Settlement,the Company agrees that it will not seek to make effective a change in
base electric or natural gas rates prior to April 1,2013,by means of a general rate filing.(Any filing of a
general rate case prior to April 1,2013,may not request an effective date prior to April 1,2013.)This
will not prevent the Company,however,from otherwise seeking to implement other rate changes
affecting the rates billed to customers,including,but not limited to,adjustments under the power cost
adjustment (PC A)mechanism,purchased gas cost adjustments (PGA);DSM tariff rider adjustments;etc.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF PUBLIC AND TECHNICAL HEARINGS
ORDER NO.32348 2
Cost of Service.As part of this rate case,the Company prepared an analysis of a peak credit
method of classifying production costs,allocating 100%of transmission costs to demand,and allocating
transmission costs to reflect any peak and off-peak seasonal cost differences on a weighted 1 2-month
basis.The Parties have agreed to exchange information and convene a public workshop,prior to the
Company’s next general rate case,with respect to the method of allocation of demand and energy among
the customer classes,such as the possible use of a revised peak credit method for classifying production
costs,as well as consideration of the use of a 12 Coincident Peak (CP)(whether “weighted”or not)versus
a 7 CP or other method for allocating transmission costs.This workshop will also address the merits of
inclining or declining block rates for service schedules 11,21,25 and 3 1.
Rate Spread/Rate Design.The Parties agree that the increase in base revenue would be
spread to all electric and natural gas rate schedules on a uniform percentage basis.The Settlement
provides that the current residential electric basic charge of $5.00 per month will be increased to $5.25,
and the residential natural gas basic charge of $4.00 per month will be increased to $4.25.The following
tables reflect the agreed-upon percentage increase by schedule for electric and natural gas service:
Electric Increase Percentage by Schedule
Net Increase in
Rate Schedule Increase in Base Rates Billing Rates*
Residential Schedule 1 1.1%-2.1%
General Service Schedule 11/12 1.1%-1.1%Large General Service Schedule 2 1/22 1.1%-1.4%
Extra Large General Service Schedule 25 1.1%-3.9%
Clearwater Paper Schedule 25P 1.1%-5.2%Pumping Service Schedule 31/31 1.1%0.0%Street &Area Lights Schedules 1.1%2.7%
Overall 1.1%-2.4%
*Net increase includes the effects of the proposed changes in Schedule 59(Residential Exchange),Schedule 66 (Power Cost Adjustment),Schedule 99(Deferred State Income Tax)and the General Rate Increase,all effective on October1,2011,if approved.
Natural Gas Increase Percentage by Schedule
Net Increase in
Rate Schedule Increase in Base Rates Billing Rates**
General Service Schedule 101 1.6%-0.5%Large General Service Schedules 111/112 1.6%-1.8%Interruptible Sales Schedules 13 1/132 1.6%-10.6%Transportation Service Schedule 146 1.6%3.0%
Overall 1.6%-0.8%
**Net Increase includes the effects of the proposed changes in Schedule 150/155
(PGA),Schedule 191 (Energy Efficiency Rider),Schedule 199 (Deferred State
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF PUBLIC AND TECHNICAL HEARINGS
ORDER NO.32348 3
Income Tax)and the General Rate Increase,effective on October 1,2011,if
approved.
Customer Service-Related Issues.(a)Funding for Outreach for Low-Income Conservation.
The Parties agree to annual funding of $50,000 for purposes of providing low-income outreach and
education concerning conservation (representing an increase of $10,000 from previous funding levels).
This amount will be funded through the Energy Efficiency Tariff Rider (Schedules 91 and 191),and will
be in addition to the $700,000 of Low-Income Weatherization funding currently in place.
(b)Collaboration on Low-Income Weatherization.The Company and interested parties will
meet and confer prior to the Company’s next general rate filing in order to assess the Low Income
Weatherization and Low Income Energy Conservation Education Programs and discuss appropriate levels
of low-income weatherization funding in the future.
NOTICE OF PUBLIC HEARING
AND TECHNICAL HEARING
YOU ARE HEREBY NOTIFIED that the deadline for filing direct testimony in
support or opposition to the proposed settlement is September 9,2011.The parties shall serve
their testimony on each other via e-mail.Testimony and exhibits filed in this case must conform
to Rules 230 and 231,IDAPA 31.01.01.230 and 231.Parties shall file an original and nine (9)
paper copies of testimony with the Commission Secretary on the date documents are due.
YOU ARE FURTHER NOTIFIED that the public hearing in this matter will convene
on TUESDAY,SEPTEMBER 13,2011,AT 7:00 P.M.(PST)IN THE DRIFTWOOD BAY
ROOM AT THE STUDENT UNION BUILDING,NORTH IDAHO COLLEGE,1000
WEST GARDEN AVENUE,COEUR D’ALENE,IDAHO.The purpose of the public hearing
will be for the Commission to take the formal testimony of customers and interested members of
the public.Testimony will be recorded and made part of the Commission’s formal record for
decision in this matter.The Company’s customers and any other interested members of the
public are encouraged to attend and give testimony.
YOU ARE FURTHER NOTIFIED that the technical hearing in this matter will
convene on TUESDAY,SEPTEMBER 13,2011,AT (APPROXIMATELY)7:30 P.M.
(PST)IN THE DRIFTWOOD BAY ROOM AT THE STUDENT UNION BUILDING,
NORTH IDAHO COLLEGE,1000 WEST GARDEN AVENUE,COEUR D’ALENE,
IDAHO.All parties intending to offer testimony in this matter shall present their testimony at
the technical hearing in Coeur d’Alene.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF PUBLIC AND TECHNICAL HEARINGS
ORDER NO.32348 4
YOU ARE FURTHER NOTIFIED that the Settlement Stipulation together with its
accompanying Motion and attachments can be viewed at the Commission’s office in Boise.
Idaho.The Settlement Stipulation is also available for viewing on the Commission’s web site at
www.puc.idaho.gov by clicking on “File Room”and then “Electric Cases.”
YOU ARE FURTHER NOTIFIED that the Commission is not bound by any
settlement reached by the parties.The Commission will independently review any settlement
proposed to determine whether the settlement is just,fair and reasonable,and in the public
interest,or otherwise in accordance with law or regulatory policy.The Commission may accept
the settlement,reject the settlement,or state additional conditions under which the settlement
will be accepted.IDAPA 31.01.Ol.274-.276.
YOU ARE FURTHER NOTIFIED that written public comments concerning the
proposed settlement be served upon the Commission and Avista at the following addresses:
Commission Secretary Kelly Norwood,Vice President
Idaho Public Utilities Commission State &Federal Regulation
P0 Box 83720 Avista Utilities
Boise,ID 83 720-0074 P0 Box 3727
1411 East Mission Avenue
Street Address for Express Mail:Spokane,WA 99220-3727
E-mail:kii’.norwood(avistacorp.com
472 W.Washington Street
Boise,ID 83702-5918 David J.Meyer
Vice President &Chief Counsel
Reg.&Gov’t Affairs
Avista Corporation
P0 Box 3727
1411 East Mission Avenue
Spokane,WA 99220-3 727
E-mail:david.meyer@avistacorp,com
These comments should contain the case caption and case number shown on the first page of this
document.Persons desiring to submit comments via e-mail may do so by accessing the
Commission’s home page located at ‘.puc.idaho.gov.Click the “Comments and Questions”
icon and complete the comment form using the case number as it appears on the front of this
document.These comments must also be sent to Avista at the e-mail addresses listed above.
YOU ARE FURTHER NOTIFIED that all hearings and prehearing conferences in
this matter will be held in facilities meeting the accessibility requirements of the Americans with
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF PUBLIC AND TECHNICAL HEARINGS
ORDER NO.32348 5
Disabilities Act (ADA).Persons needing the help of a sign language interpreter or other
assistance in order to participate in or to understand testimony and argument at a public hearing
may ask the Commission to provide a sign language interpreter or other assistance at the hearing.
The request for assistance must be received at least five (5)working days before the hearing by
contacting the Commission Secretary at:
IDAHO PUBLIC UTILITIES COMMISSION
P0 BOX 83710
BOISE,IDAHO 83720-0074
[phone] (Telephone)
[phone] (FAX)
Email:secretary(puc.idaho.gov
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be
conducted pursuant to the Commission’s Rules of Procedure,IDAPA 31.01.01.000 el seq.
ORDER
IT IS HEREBY ORDERED that the public hearing and the technical hearing in this
case are scheduled for September 13,2011,in Coeur d’Alene,Idaho.
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF PUBLIC AND TECHNICAL HEARINGS
ORDER NO.32348 6
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this 3/
day of August 2011.
ATTEST:
MACK A.REDFORD,COMMIS.
Y I ‘v—1
A I /1 ‘\i1
.MARSHA H.SMITH,COMMISSIONER
Jean D.JeweWJ
Commission Secretary
O:AVU-E-11 -01 AVU-G-11-01 wsSettlement
NOTICE OF PROPOSED SETTLEMENT
NOTICE OF PUBLIC AND TECHNICAL HEARINGS
ORDER NO.32348 7