20180914Decision Memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER RAPER
COMMISSTONER ANDERSON
COMMISSION SECRETARY
COMMISSTON STAFF
LEGAL
FROM:BRANDON KARPEN
DEPUTV ATTORNEY GENERAL
DATE: SEPTEMBER 11,2018
SUBJECT:JOINT APPLICATION OF HYDRO ONE LIMITED AND AVISTA
CORPORATTON FOR APPROVAL OF MERGER AGREEMENT;
cAsE NOS. AVU-E-I7-09 AND AVU-G-17-05
On September 14,2017, Hydro One and Avista ("Applicants") jointly applied for
Commission approval of a merger between the two Companies. Applicants also sought approval
from utility regulators in Washington, Oregon, Alaska, and Montana. Assuming approval in the
other states, this Commission's approval would result in Avista becoming a wholly owned
subsidiary of a Hydro One holding company. The following parties intervened in this case: Idaho
Forest Croup, Clearwaler Paper, Idaho Conservation League, the Community Action Partnership
Association of ldaho, the Washington and Northern ldaho District Council of Laborers, an
unincorporated nonprofit called Avista Customer Group (ACG), and the Idaho Department of
Water Resources (IDWR).
On April 13, 2018, the Applicants and Commission Staff filed a Motion for Approval
of settlement stipulation to approve the proposed merger. The Motion notified the Commission
that all parties (except for ACG and IDWR, which had not yet intervened in the case) had signed
a settlement Stipulation to fully resolve the case. As part of its review process, the Commission
issued notice of the proposed settlement and set deadlines for interested persons to submit
written comments. The Commission also held public hearings in Moscow, Sandpoint, and Coeur
d'Alene for Avista's customers and other interested persons to testify. The Commission also
scheduled a July 23,2018, technical hearing for the parties to specifically address the concerns
and issues raised in public comments and testimony.
DECISION MEMORANDUM I
In mid-July, the Hydro One CEO and board of directors resigned-apparently
removed by the company's largest shareholder, the province of Ontario, Canada. The
management change and the post-settlement intervention of ACG and IDWR led the
Commission to vacate the technical hearing. Order No.34lll. On August 31,2018, the
Commission directed the parties to meet and confer to develop a proposed case processing
schedule. On September 10,2018, the parties met and agreed to a proposed case processing
schedule.
STAFtr' RECOMMENDATION
Staff can now report that the parties developed a proposed schedule to process the
remainder of the case. The parties request the Commission to approve the following:
l. Applicants' Deadline for Supplcrnental. Testimony: September 24, 2018;
2. Settlement Conference: October 16,2018, at 09:00 MDT;
3. Staffand Intervenor Testimony: November l, 2018;
4. Company Rebuual Testimony: November 14, 2018;
5. Technical Hearing: November 26,2018; and
Additionally, the parties request that the Commission allow for written closing
arguments within 24 houn of thc end of the technical hearing, but no later than noon on
November 28, 2018, unless all parties agree to, or the Commission orders, oral closing
arguments. Finally, Applicants request that the Commission issue a final order in this matter by
December 14,2018, in order to parallel with other state jurisdictions, and enable the merger to
close by the end of the year,
COMMISSION DECISION
Does the Commission wish to issue an order adopting the proposed case processing
schedule as described in the Staff recommendation?
B
Deputy Attorney Ceneral
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')DECISION MEMORANDUM