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Home My WebLink About20130731Direct Patrick Ehrbar.pdf;-l i- j-l -' . DAVID J. MEYER VICE PRESIDENT AND CHIEF COUNSEL FOR REGULATORY AND GOVERNMENTAL AFFAIRS AVISTA CORPORATION I4I I E. MISSION AVENUE P. O.BOX3727 SPOKANE, WASHINGTON 99220 PHONE: (509) 495-4316, FAX: (s09) 495-8851 ?il:: _tll!_ 3 I Pit t?: l6 BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION rN THE MATTER OF THE POWER COST ) CASE NO. AW-E-l3-I!-+ ADJUSTMENT (PCA) ANNUAL RATE ) ADJUSTMENT FILING OF AVISTA ) DIRECT TESTIMONY OFCORPORATION ) PATRICK D. EHRBAR FOR AVISTA CORPORATION 1 2 3 4 5 6 7 8 9 10 ll t2 13 t4 15 t6 t7 l8 t9 20 2t 22 23 a. Please state your name, the name of your employer, and your business address. A. My name is Patrick D. Ehrbar. I am employed by Avista Corporation ("Avista" or "Company'') at l4ll East Mission Avenue, Spokane, Washington. O. In what capacity are you employed? A. I am employed by Avista as Manager of Rates and Tariffs in the State and Federal Re gulation Department. a. Phase state your educational background and professional experience. A. I am a 1995 graduate of Gonzaga University with a Bachelors degree in Business Administration. ln 1997 [ graduated from Gonzaga University with a Masters degree in Business Administration. I started with Avista in April 1997 as a Resource Management Analyst in the Company's Demand Side Management (DSM) department. Later,I became a Program Manager, responsible for energy efficiency program offerings for the Company's educational and governmental customers. In 2000,I was selected to be one of the Company's key Account Executives. In this role I was responsible for, among other things, being the primary point of contact for numerous commercial and industrial customers, including delivery of the Company's site specific energy efficiency programs. I joined the State and Federal Regulation Department as a Senior Regulatory Analyst in 2007. Responsibilities in this role included being the discovery coordinator for the Company's rate cases, line extension policy tariffs, as well as miscellaneous regulatory issues. In November 2009,I was promoted to my current role. a. Have you previously testilied before this Commission? A. Yes. I have provided pre-filed direct testimony before this Commission in several prior proceedings. Ehrbar, Di Avista Page I I 2 3 4 5 6 7 8 9 l0 1l l2 13 t4 15 16 I7 18 t9 20 2l 22 23 a. What is the scope of your testimony in this proceeding? A. My testimony provides a status report of the accounting entries and account balances related to the Power Cost Adjustment (PCA) for the twelve months ended June 30, 2013. MytestimonyalsoaddressestheproposedrebatetobeeffectiveOctoberl,2013,which will replace the existing rebate. a. Are you sponsoring an Exhibit? A. Yes. I am sponsoring Exhibit No. PDE-I. Page I consists of a sheet showing the calculation of the proposed uniform cents per kilowatt-hour PCA rebate of 0.152$,, as well as the impact of the proposed PCA rate decrease by rate schedule. Page 2 is the proposed PCA tariff, Schedule 66. a. Would you please explain the Order that was issued regarding Avista's existing PCA methodology? A. Yes. On June 29,2007 the Commission issued Order No. 30361 in Case No. AVU- E-07-01. That case dealt with the review of the PCA methodology and method of recovery. The Commission approved a change in the PCA methodology from a trigger and cap mechanism to a single annual PCA rate adjustment filing requirement. The Commission approved the following procedural schedule for administering the annual PCA filings: August I Company filing for prior July - June deferral period September I Review and comments by Staff and other interested parties October I Commission Order and effective date of PCA rate adjustment The Commission also approved a change in the method of PCA deferral recovery from a uniform percentage basis to a uniform cents per kilowatt-hour basis effective with the October l, 2007 rate change. By OrderNo.32206 in CaseNo. GNR-E-10-03 dated March 15,2011, the Ehrbar, Di Avista Page2 I Commission modified the retail revenue credit methodology and approved a Load Change 2 Adjustment Rate based on the energy classified portion of embedded production revenue 3 requirement effective April l,20ll. 4 a. Would you please summarize the filing and Order associated with the existing 5 PCA rate? 6 A. Yes. On July 30, 2012, Avista filed its annual PCA report for the period July 1, 7 201I through June 30, 2012 and requested a PCA rebate of 0.0900 per kilowatt-hour effective 8 October 1,2012. The Commission approved that proposal in Case No. AW-E-12-06, by Order 9 No. 32654, dated September 28, 2012. l0 a. Does the present filing conform to the requirements of the prior Commission 1l Orders regarding the PCA? 12 A. Yes. The proposed PCA rate adjustment is based on the following: 13 l) Defenals for the period July l, 2012through June 30,2013, including interest, 14 2) The unrecovered balance related to the July I ,2011 through June 30, 2012 deferral 15 period, including interest, 16 3) The remaining balance related to the Deferred State Income Tax (DSIT) credits as of 17 September 30,20121, and 18 4) Interest during the recovery period of October 1,2013 through September 30,2014. 19 The proposed PCA rebate rate is a uniform cents per kilowatt-hour rate of 0.1521 to be 20 effective October 1,2013. I In Case No. AW-E-10-01, the Company agreed to credit to electric customers $17.0 million of accumulated deferred state income tax over a two-year period, beginning October l, 2010. The remaining balance not credited to customers through Tariff 99 at the end of the two-year period (ending September 30, 2012) was to be transferred to the PCA defenal account. The Company transferred $484,663 in November 2012. Ehrbar, Di Avista Page 3 I 2 J 4 5 6 7 8 9 l0 ll t2 l3 l4 t5 t6 a. What were the amounts of deferrals and through June 30, 2013? A. The amounts are shown below: Deferrals (July 2012 - June 2013) Interest Rebate Balance at June 30,2013 interest for the period July 1,2012 $(3,875,180) (22.309) s(3.897.489) t7 l8 t9 Company witness Mr. Johnson discusses the components that make up the deferrals shown above. The ($22,309) interest amount represents interest for the twelve-month period July 1, 2012 through June 30,2013. Interest for the twelve-month period was calculated using the Customer Deposit Rate of 1%. a. What rebate rate is the Company proposing to be effective October 1,2013? A. The Company is proposing a uniform cents per kilowatt-hour PCA rebate of 0.152(, to be effective October l, 2013. Page I of Exhibit No. PDE-I shows the calculation of the proposed rebate. Page 2 of Exhibit No. PDE-I is a copy of the proposed tariff Schedule 66, which contains the proposed PCA rebate rate. The proposed rebate is designed to pass through the following: Deferrals and interest for the July l, 2012through June 30,2013 period Unrecovered balance related to the July I , 20 I I through June 30, 2012 deferral period Remaining balance of DSIT Estimate of interest for July 1,2013 through September 30,2014 Total Amount to Rebate to Customers ($3,897,489) (142,134) (484,663) (.33.574) ($4.5s7.860) After applying the conversion factor related to commission fees and uncollectible customer accounts receivable, the resulting decrease in revenue requirement of $4,581,000 is Ehrbar, Di Avista Page 4 I 2 aJ 4 5 6 7 8 9 l0 l1 t2 13 t4 15 I6 t7 l8 t9 20 2t 22 23 divided by forecasted kilowatt-hours to derive the proposed rebate rate of 0.152i, per kilowatt- hour. a. What is the impact of the proposed PCA rate decrease by rate schedule? A. Page I of Exhibit No. PDE-I shows the effect of the proposed PCA rate decrease by rate schedule. The proposed rebate is 0.1521 per kilowatt-hour, which is 0.062(, per kilowaff- hour greater than the existing rebate of 0.0900 per kilowatt-hour. Column (f) shows the percentage decreases by rate schedule. The overall decrease is 0.83%. a. What will be the impact of the proposed rebate on an average residential customer? A. Under the Company's proposal, the PCA rebate rate for all customers, including residential customers, will increase from a 0.0901 per kilowatt-hour rebate to a 0.1521, per kilowatt-hour rebate, an increase in the rebate rate of 0.062(, per kilowatt-hour. Residential customers using an average of 930 kilowatt-hours per month would see their monthly bills decrease from $78.69 to $78.1 l, a decrease of $0.58 per month, or 0.74%o. a. Is the Company continuing with its customer bill paying assistance programs? A. Yes. The Company has several programs available to assist customers with paying their bills. Avista's Comfort Level Billing (CLB) program offers the option for customers to pay the same bill amount each month of the year by averaging their annual usage. Under this program, customers can avoid unpredictable winter heating bills. The Customer Assistance Referral and Evaluation Services (CARES) program provides assistance to special-needs customers through access to specifically trained CARES representatives who provide referrals to area agencies and churches for help with housing, utilities, medical assistance, etc. Low Income Home Energy Assistance Program (LIHEAP) is a Federal program aimed to assist low income Ehrbar, Di Avista Page 5 1 2 5 4 5 6 7 8 9 10 1l t2 13 t4 l5 t6 t7 customers pay their electric and natural gas bills. These funds are distributed through local agencies. Project Share is a voluntary contribution option allowing customers to contribute donations that are distributed through local community action agencies to customers in need. Idaho customers who have children, elderly or infirm persons in the household may qualiff for the Winter Moratorium plan. From December I through February 28, customers are not required to pay their bills in full and can defer payment or make partial payments. In addition, the Winter Payment Plan provides for lower winter bill payments by allowing customers to make monthly payments equal to one-half of the levelized bill amounts, with balance in full or a new payment arrangement due by April I't. The Company also works out payment arrangements with customers having difficulty paying their bills. In addition, the Company has convenient options that help those who need flexibility, but are generally able to pay. APS, or automatic payment service (money is deducted from a customer's checking account automatically each month), is one example. Other services include debit and credit card service, check-by-phone or over the web, preferred due date (the customer picks a more convenient date to pay than the one the Company states on the bill), and e-billing. a. Does that conclude your pre-filed direct testimony? A. Yes, it does. Ehrbar, Di Avista Page 6 DAVID J. MEYER VICE PRESIDENT AND CHIEF COUNSEL FoR ?T:: -},jI- 3 I I-']1 13. I I REGULATORY AND GOVERNMENTAL AFFAIRS AVISTA CORPORATION il!-.=l'i,I4I1 E. MISSION AVENUE I -I ! . P. O.BO){3727 SPOKANE, WASHINGTON 99220 PHONE: (509) 489-0500, FAX: (509) 495-8851 BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION rN THE MATTER OF THE POWER COST ) CASE NO. AW-E-13- ADJUSTMENT (PCA) ANNUAL RATE ) ADJUSTMENT FILING OF AVISTA ) EXHIBIT NO. PDE.I 2+ CORPORATION ) PATRICK D. EHRBAR FOR AVISTA CORPORATION AVISTA UTILITIES IDAHO ELECTRIC IMPACT OF PROJECTED SCHEDULE 66 PCA DECREASE PROPOSED RATE TO BE EFFECTIVE OCTOBER 1.2013 (000s of Dollars) (000s of kWh) Line Type ofNo. Service (a) 1 Residential2 GeneralService3 Large GeneralService4 Extra Large GeneralService5 Clearwater6 Pumping Service7 Street & Area Lights8 Total Proposed rebate rate Existing rebate rate lncrease in rebate rate Schedule Number (b) 1 Pro Forma Kilowatt-hours (cX1) 1,161,019 TotalBilled Revenue Proposed at Present Sch.66Rates Decrease(d)(1) (e) $96,390 -$715 Percent Decrease on Billed Revenue (0 -0.740/o -0.66% -0.82o/o -'1.2'lo/o -1 .37o/o -0.69% -0.25o/o -0.83% 11,12 348,963 32,597 -2152',t,22 684,215 51,597 42125 314,356 16,024 -19425P 444,403 19,962 -274 31,32 54,894 4,867 -3441-49 13,807 3,444 -9 I 10 11 -$0.00152 -0.00090 -$4,581 -$2.719 -$0.00062 -$1,861 -$4,382 -11 -142 _23 -j4-555' 0.995010 -67 3,021,657 -$0.00152 Proposed rebate rate'12 Deferrals including interest 711112-6130113 13 lnterestTl'1113-913011314 Projected under-recovered balance at 9/30/1315 Forecasted interest 101'1113-913011416 Totalto rebate including interest17 Conversion factor18 Revenue requirement19 kWh's from above20 Proposed rebate rate'1011113 (1) Source: Revenue forecast forthe twelve month period October '1,20'13 - September 30,2014. lncludes all present rate adjustments: Schedule 59 - Residentialand Farm Energy Rate Adjustment, Schedule 66 - Temporary Power Cost Adjustment, and Schedule 91 - Energy Efficiency Rider Adjustment. Exhibit No. PDE-1 Case No. AVU-E-13._ P. Ehrbar, Avista Page 1 of 2 !.P.U.C. No.28 Fifteenth Revision Sheet 66 Canceling Fourteenth Revision Sheet 66 66 AVISTA CORPORATION d/b/a Avista Utilifies SCHEDULE 66 TEMPORARY POWER COST ADJUSTMENT - IDAHO APPLICABLE: To Customers in the State of ldaho 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 decreased by 0.152i, per kilowatt-hour in all blocks of these rate schedules. Flat rate charges for Gompany-owned or Customer-owned Street Lighting and Area Lighting Service, Schedules 4149, are to be decreased by 0.152i, 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 defened povver 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. lssued July 30, 2013 lssued by Avista UtilitiesBy _ , Kelly O. Nonrood -Mce President, State & Federal Regulationru J^,^,GJ .*"*TT)'..llEi- P. Ehrbar, Avista Page 2 of 2