20140730Application.pdf

Avista Corp.
1411 East Mission P.O. Box3727
Spokane. Washington 99220-0500
Telephone [phone]
TollFree 800-727-9170
FILED VIA OVERNIGHT MAIL
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?BIq JUL 30 AH 9: 57
luly 29,2014
Ms. Jean D. Jewell, Commission Secretary
Idaho Public Utilities Commission
472W. Washington St.
Boise,ID 83702-5983
RE: Case No. AVU-E-l4-Ab
Power Cost Adjustment (PCA) Annual Filing of Avista Corporation
Dear Ms. Jewell:
Enclosed for filing with the Commission is Avista's Power Cost Adjustment (PCA) annual
filing. The filing consists of an original and seven copies of Avista's Application and nine
copies of prefiled testimony and exhibits. Also enclosed are three copies of supporting
workpapers and documentation. A certificate of service, three copies of a customer notice, and
three copies of a press release are also enclosed. 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 for the period July 1, 2013 through June 30,2014, and approving a PCA surcharge
of 0.252( per kilowatt-hour to be effective October 1,2014. Under the Company's proposal, the
PCA rate for all customers, including residential customers, would increase from a rebate of
0.152fi per kilowaff-hour to a surcharge of 0.2521, per kilowatt-hour, or an increase rate of
0.404i, per kilowaff-hour. Therefore,38% of the proposed PCA rate adjustment is related to the
expiration of a rebate to customers and 620/o is related to increased power supply costs over the
last twelve months. Since PCA rate adjustments are spread on a uniform cents per kilowatt-hour
basis, the resulting percentage increases vary by rate schedule. The overall increase is 4.99o/o.
For an average residential customer using 930 kilowatt-hours per month, the monthly increase
will be $3.76. Under present rates, a residential bill for 930 kilowatt-hours amounts to $81.88.
With the proposed surcharge in place the monthly bill would be $85.64, or 4.59%o greater than
the bill under present ratesl.
Please note that Avista has deemed certain supporting documents to be classified as
CONFIDENTIAL, rendering these documents exempt from public inspection, examination and
copying pursuant to Sections 9-3404 through 9-340F of the Idaho Code. Avista believes that the
identified CONFIDENTIAL supporting documents contain valuable commercial information.
t On July 30,2014, Avista filed with the Commission changes to Residential Exchange Program (Schedule 59),
which will decrease the average residential customer monthly bill by $0.31 or 0.4o/o. The requested effective date
for this filing is October 1,2014, the same requested effective date in this PCA filing.
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As such, Avista is submitting a separate electronic CD containing the electronic form of the
CONFIDENTIAL supporting documents, in compliance with Rule 067.02.b.
Please direct any questions regarding this filing to Jeanne Pluth at [phone].
Sincerely,
Vice President and Chief Counsel for Regulatory and Governmental Affairs
Enclosures
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
ldaho Public Utilities Commission
472W. Washington St.
Boise, lD 83702-5983
Marv Lewallen
Clearwater Paper
601 W. Riverside Avenue
Suite 1100
Spokane, WA 99201
marv. lewa I len@clearwaterpaper. com
(Excluding Confidential lnformation)
Dean J. Miller
McDevitt & Miller LLP
P.O.Box 2564
Boise, ID 83701
Emai! : ioe@mcdevitt-m iller.com
(Excluding Confidential lnformation)
Larry A Crowley
The Energy Strategies lnstitute lnc
5549 S. Cliffsedge Ave
Boise, !D 83716
Email: [e-mail]
(Excluding Confidential lnformation)
ay of July 2014.
Patrick Ehrbar
Manager, Rates & Tariffs
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DAVID J. MEYER
VICE PRESIDENT AND CHIEF COUNSEL FOR
REGULATORY AND GOVERNMENTAL AFFAIRS
AVISTA CORPORATION
1411 E. MISSION AVENUE
P. O.BOX3727
SPOKANE, WASHINGTON 99220
PHONE: [phone], FAX: [phone]
IN THE MATTER OF THE POWER COST
ADJUSTMENT (PCA) ANNUAL RATE
ADJUSTMENT FILING OF AVISTA
CORPORATION
Kelly O. Norwood
Vice President
State and Federal Regulation
Avista Corporation
1411 E. Mission Avenue
Spokane, Washington 99220
Phone: [phone]
Fax: [phone]
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
)) CASE NO. AVU-E-I4-DQ,
) APPLICATION OF AVISTA
) CoRPORATTON
David J. Meyer
Vice President and Chief Counsel for
Regulatory and Governmental Affairs
Avista Corporation
141I E. Mission Avenue
Spokane, Washington 99220
Phone: [phone]
Fax: [phone]
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I. INTRODUCTION
Avista Corporation, doing business as Avista Utilities (hereinafter Avista or Company),
at 1411 East Mission Avenue, Spokane, Washington, respectfully files its Power Cost
Adjustment (PCA) annual rate adjustment filing in the above referenced case. The Company
requests the Commission issue an order approving the level of power costs deferred in the
surcharge direction for the period July l, 2013 through June 30,2014, and approving a PCA
surcharge of 0.252(, per kilowaff-hour to be effective October 1,2014. The Company requests
that this filing be processed under the Commission's Modified Procedure Rules.
Communications in reference to this Application should be addressed to:
AVISTA'S PCA ANNUAL RATE ADJUSTMENT FILING PAGE I
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II. BACKGROUND
Avista's PCA is used to track changes in revenues and costs associated with variations in
hydroelectric generation, secondary prices, thermal fuel costs, and changes in power contract
revenues and expenses. Avista's existing PCA methodology and method of recovery were
approved in Case No. AVU-E-07-01 by Order No. 30361 dated Jwrc 29,2007. In that case 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 1 Company filing for prior July - June deferral period
September I Review and comments by Staff and other interested parties
October 1 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 1,
2007 PCA rate change. By Order No. 32206 in Case No. GNR-E-I0-03 dated March 15,2011,
the Commission modified the retail revenue credit methodology and approved a Load Change
Adjustment Rate based on the energy classified portion of embedded production revenue
requirement effective April 1, 2011.
The existing PCA rebate was made effective on October 1,2013. On July 31,2013,in
Case No. AVU-E-13-04, Avista filed its annual PCA report for the period July l, 2012 through
June 30, 201 3 and requested a PCA rebate of 0.1521, per kilowatt-hour effective October I , 2013 .
The Commission approved that proposal by Order No. 32892, dated September 19,2013.
AVISTA'S PCA ANNUAL RATE ADJUSTMENT FILING PAGE 2
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III. DEFERRALS - JULY 1,2013 THROUGH JUNE 30,2014
The amount of power cost deferrals for the period July 1,2013 through June 30,2014 is
shown below, as well as interest for the same period. Company witness Mr. Johnson's testimony
provides an explanation of the factors causing the deferral entries for the period. Company
witness Ms. Pluth's testimony addresses the interest amount.
Deferrals (July 2013 - June 2014) 7,705,909
Interest 63.725
Rebate Balance at June 30,2014 [ZJ05J09
Monthly reports have been filed with the Commission regarding actual PCA defenal
entries to date. An additional copy of those reports for the months of July 201 3 through June
2014 have been included with this filing and have also been provided to Clearwater Paper
Corporation.
IV. PROPOSED SURCHARGE TO BE EFF'ECTI\rE OCTOBER 1,2014
The Company is proposing a uniform cents per kilowatt-hour PCA surcharge of 0.252f to
be effective October 1,2014. Attached as Exhibit'oA" is a copy of the proposed tarifl Schedule
66 (Sixteenth Revision), which contains the proposed PCA surcharge rate. Also included in
Exhibit "A" is a tariff sheet that shows the proposed changes to Schedule 66 (Fifteenth Revision)
by the use of strikeouts and underlining. Page I of Ms. Pluth's Exhibit No. _ (JMP-I) shows
the calculation ofthe proposed surcharge. The proposed surcharge is designed to collect a) the
deferrals for the period July 1, 2013 through June 30,2014, b) recovery of the estimated rebate to
customers in excess of the rebate balance for the October 1,2013 to September 30, 2014 rate
period, c) estimated interest to be recorded during the twelve months the surcharge will be in
effect (October 1,2014 through September 30,2015), and d) an adjustment to correct an error
related to the allocation of natural gas transport costs between the Company's power supply
AVTSTA'S PCA ANNUAL RATE ADruSTMENT FILING PAGE 3
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operations and the Company's natural gas distribution operations. In addition, the proposed
surcharge has been adjusted to reflect the $713,000 credit for the 2013 earning test, that has been
proposed in Docket No. AVU-E-14-05.
Since PCA rate changes are spread on a uniform cents per kilowatt-hour basis, the
resulting percentage increases vary by rate schedule. Page I of Ms. Pluth's Exhibit No. JMP-I
shows the effect of the proposed PCA rebate by rate schedule. The proposed surcharge is 0.2521,
per kilowatt-hour, which is 0.404(, per kilowatt-hour greater than the existing rebate of 0.152(,
per kilowatt-hour. Therefore, 38% of the proposed PCA rate adjustment is related to the
expiration of a rebate to customers and 62% is related to increased power supply costs over the
last twelve months. Column (0 on page I of Exhibit No. JMP-I shows the percentage increases
by rate schedule. The overall increase is 4.99%.
Residential customers using an average of 930 kilowatt-hours per month would see their
monthly bills increase from $81.88 to $85.64, an increase of $3.76 per month, or 4.59o/o. These
impacts do not include other proposed rate changes to become effective on October l,2}l4.r
V. REQUEST FOR RELIEF
The Company requests the Commission issue an order approving the level of power costs
deferred in the surcharge direction for the period July l, 2013 through June 30, 2014, and
approving a PCA surcharge of 0.252(, per kilowatt-hour to be effective October 1,2014. The
Company requests that the matter be processed under the Commission's Modified Procedure
rules through the use of written comments.
' On July 30,2014, Avista filed with the Commission changes to Residential Exchange Program (Schedule 59),
which will decrease the average residential customer monthly bill by $0.31 or 0.4o/o. T\e requested effective date
for this filing is October 1,2014, the same requested effective date in this PCA filing.
AVISTA'S PCA ANNUAL RATE ADruSTMENT FILING PAGE 4
Dated at Spokane, Washington this 2%hday of July 2014.
AVISTA CORPORATION
VicerPresident and Chief Counsel
for Regulatory and Governmental Affairs
AVISTA'S PCA ANNUAL RATE ADruSTMENT FILING PAGE 5
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VERIFICATION
STATE OF WASHINGTON )
)
County of Spokane )
David J. Meyer, being first duly sworn on oath, deposes and says: That he is the Vice
President and Chief Counsel for Regulatory and Govemmental Affairs for Avista Corporation
and makes this verification for and on behalf of said corporation, being thereto duly authoized;;
That he has read the foregoing filing, knows the contents thereof, and believes the same
to be true.
SIGNED AND SWORN to before me this 29thday of July 2014, by David J. Meyer.
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AVISTA'S PCA ANNUAL RATE ADruSTMENT FILING PAGE 6
Case No. AVU-E-L4-
Exhibit $A)'
l.P.U.C. No.28
Sixteenth Revision Sheet 66
Canceling
Fifteenth Revision Sheet 66
AVISTA CORPORATION
d/b/a Avista Utilities
SCHEDULE 66
TEMPORARY POWER COST ADJUSTMENT - IDAHO
APPLICABLE:
To Customers in the State of ldaho where the Company has electric service
available. This Power Cost Adjustment shal! be applicable to all retail customers for
charges for electric energy sold and to the flat rate charges for Company-owned or
Customer-owned Street Lighting and Area Lighting Service. This Rate Adjustment is
designed to recover or rebate a portion of the difference between actual and allowed
net power supply costs.
MONTHLY RATE:
The energy charges of electric Schedules 1,11,12,21,22,25,25P,31, and 32
are to be increasedby 0.252$ 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 4149, are to be increasedby 0.2521 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.
lssued by
By
Avista Utilitiesry Ait". Nonrvood - Vice President, State & Federal Regulation
AVISTA CORPORAT]ON
d/b/a Avista Utilities
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 increased Ce€r€ased by 0.252G, W$, 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 Ceereased by 0.2526
W 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.
Effective October 1,20142€4a
l.P.U.C. No.28
Sixteenth Fifteenth Revision Sheet 66
Canceling
Feurteenth Revision Sheet 66
lssued by
By
Avista Utilities
Kelly O. Norwood -Vice President, State & Federal Regulation