20180730Brandon Direct.pdf

DAVID J. MEYER
VICE PRESIDENT AI\TD CHIEF COUNSEL FOR
REGULATORY AND GOVERNMENTAL AFFAIRS
AVISTA CORPORATION
1411 E. MISSTON AVENUE
P. O. BOX 3727
SPOKANE, WASHINGTON 99220
PHONE: [phone]L5, FAX: [phone]
RTCEIVED
Zill8 JIL 30 AH g: 29
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BEFORE THE TDAIIO PT]BIJIC I'TILTTIES COMMISSION
IN THE MATTER OF THE POWER COST
ADJUSTMENT (PCA) ANNUAL RATE
AD.]USTMENT FILING OF AVISTA
CORPORATION
CASE NO. AVU-E-1-8-07
DIRECT TESTIMONY OF
ANNETTE M. BRANDON
FOR AVTSTA CORPORATION
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O. Please etate your name, busiaess address aad
present positioa with Avista Corporation?
A. My name is Annette M. Brandon and my business
address is l-41-1- East Mission Avenue, Spokane, Washington. f
am presently assigned to the Regulatory Affairs Department
as a Senior Regulatory Analyst.
A. Would you briefly describe your educational
backgror:nd and professional ocperience?
A. Yes. f am a 2002 graduate of Eastern Washington
Uniwersity with a Bachelor of Arts degree in Business
Administration Professional Accounting. I started with
Avista in .Tanuary 1999 as a Budget Analyst in t.he Company's
Transmission department. I spent three years in the
Company's Tax Department before moving to Resource
Accounting for the next eight years. In this role, I was
primarily responsible for accounting for natural gas and
associated budgeting and reporting requirements. I joined
the Regulatory Affairs department as a Regulatory Analyst in
20L2 and was promoted to my current role in 201,3. My
primary responsibilities relate to natural gas procurement
(including purchase gas adjustment filings), monthly/annual
Washington Energy Recovery Mechanism (ERM) filings and Idaho
Power Cost Adjustment (PCA) f ilings. I am a1so the
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Regulatory Affairs lead for the Company's labor,
compensation and benefits programs.
a. Wtrat is the scope of your testimony in this
proceeding?
A. My testimony provides a summary of the accounting
entries and account balances related to the Power Cost
Adjust.ment (PCA) for the l2-months ended June 30,201-8. My
effectivetestimony also addresses the proposed rebate to be
October l, 20L8, which will replace the existing rebate.
O. Are you sponsoring an Exhibit?
A. Yes. I am sponsoring Exhibit No. AMB-1. page l-
details the calculation of the proposed uniform cents per
kilowatt-hour PCA rebate of 0.326+, as well as the impact of
the proposed PCA rebate rate by rate schedule. Page 2 Ls
the proposed PCA t.ariff , Schedule 56.
O. Wou1d you please provide an overview of the moet
recent history of Avista's PCA methodology that has been
approved by the Idaho Public Utilities Commission (*IPUC-) ?
A. Yes. On June 29, 2007 the Commission issued Order
No. 30351 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.
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The Commission a1so approved a change in the
from a uniformthe PCA deferral rate adjustment percentage
effectivebasis to a uniform cents per kilowatt-hour basis,
with the October 1, 2007 rate change. By Order No. 32206 in
Case No. GNR-E-10-03 dated March 15, 201L, the Commission
modified the retail revenue credit methodology and approved
a Load Change Adjustment Rat.e based on the energy-classified
portion of embedded production revenue requirement effective
April 1-, 20L1,.
The Commission approved the following procedural
schedule for administering the annual- PCA filings:
August 1 Company filing for prior ,Ju1y ,June
deferral period
September 1- Review and commenLs by Staff and other
October 1
interested parties
Commission Order and effective date of
PCA rate adjustment
O. Would you please summarize the filing and Order
20 associated with the existing PCA rate?
A. Yes. On July 31, 201-7, Avista filed its annual PCA
rate adjustment for the period .Tu1y 1, 201-6 through ,June 30,
2Ol7 and requested a PCA rebate rate of 0.240Q per kilowatt-
hour effective October L, 2017. The Commission approved
that request in Case No. AW-E -1,7 -O7 , by Order No. 33894 ,
dated September 29, 20L7 .
method of
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O. Does the present filing conform to the requirements
of the prior Commission Orders regarding the PCA?
A. Yes. Consistent with prior years, the proposed PCA
rate adjustment is based on the following:
Deferrals for t.he period ,Ju1y 1-, 201-7 through June
30, 20L8, including interest,
Unamortized balance remai-ning from the period
October 1- , 201"7 through June 3 0 , 201.8, including
interest, and
Forecast amortization and interest f rom ,JuIy L,
20Lg through September 30 , 2078.
O. What were the amounts of deferrals and interest for
the period iluly L, 2OL7 througb ilr:-ne 30, 20L8?
A. The table below summarizes the charges for this
period:
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a
a
a
20 Company
that make up
well as the
witness Mr. ,Johnson discusses the components
the $9,293,696 deferral balance shown above, as
$1,706 credit to Idaho customers related to
Washington'srenewable energy credits retired
renewable portfolio standards. The
to meet
$L8,223 interest amount
represents interest for the twelve-month period JuIy 1, 20L7
through ,June 30, 20L8. Interest for the l-2-month period was
calcul-ated using the Customer Deposit Rate of Le,, per prior
Commission order.
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Deferrals (,July 2017 - June 2018)
fnterest
Total Deferral Balance
Renewable Ene rgy Credit Retirement Benefit 7$
$ (g,zgl ,596)
(L8 ,223)
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calculation of the proposed rebate. Page 2 of Exhibit No
AMB-1 is a copy of the proposed tariff, Schedule 66, which
rate. The proposed rebatecontains the proposed PCA rebate
is designed to rebate the following:
O. Irltrat rebate rate
effective october 1, 20L8?
A. The Company is
kilowatt-hour PCA rebate
October 1-, 2018. Page 1
is the Company proposing to be
proposing a uniform cents per
rate of 0.326C to be effective
of Exhibit. No. AMB-1 shows the
the conversion factor related to
uncollectible customer accounts, the
$9,843,538 is divided by forecasted
After applying
commission fees and
resulting rebate of
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Deferrals (JuIy 201-7 - June 201-8)
Renewable Energy Credit Retirement Benefj-t
Projected Amortj-zation and Interest (,:uty 2018-
September 201-8 )
$ (9, 3L3,525)
Total
TOTAL BALANCE FOR AMORTIZATION (g 786 L7L)
Amortization Bal-ance
$ L,702,587
i (2 ,1_75, l-33 )
Total Deferral Bal-ance
$ (g,zgz ,695)
$ (1,,706)
$ (]-8,223)
$ (2,:80,935)
$ 5,251-,699
$ (55,897)
Unamortized Balance from
(prior to ,Ju]y 1, 201,7)
Amortization July 201-7
Interest
Previous Deferrals
June 201-8
Interest
I kilowatt-hours to derive the proposed rebate rate of 0.325Q
2 per kiLowatt-hour. I
3 Q. What is the impact of the proposed PCA rate
4 increase by rate schedule?
5 A. Page l- of Exhibit. No. AMB-1 shows t.he effect of t.he
6 proposed PCA rate increase by rate schedule. The proposed
7 rebate rate is 0.326+ per kilowatt-hour, which is 0.0850+
8 per kilowatt-hour more than the existing rebate rate
9 decrease of O.24OQ per kilowatt-hour. Column (g) shows the
l0 percentage decrease by rate schedule. The overall decrease
ll is 1.0?, or 52,597,000.
12 O. what will be t,he impact of the proposed rebate on
13 aa average residential customer?
14 A. under the
15 for all customers,
16 from a o.240+ per
Company's proposal, the PCA rebate rate
including residential
kilowatt-hour rebate
customers, will go
a 0.326C per
of 0.085+ per
an average of
monthly bills
of $0.79 per
to
17 kilowat.t-hour rebate, dD increased rebate
l8 kilowatt-hour. Resj-dential customers using
19 910 kilowat.t-hours per month would see their
20 decrease from $88.49 to i87.70, a decrease
2l month, or 0.9?.
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O. IE the Company continuing with its cuEtomer bill
payiag aseistance programs?
rToEal Balance for Amortizat.ion $9,786,171 divided by conversion factor
0.994aG2 = $9,843,G38
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A. Yes. The Company has several programs available to
assist customers with paying their biIls. Avista's Comfort
Level Billing (CLe) plan is based on historical charges or
an estimate of future charges and will approximate a monthly
average of the customer's estimat.ed annual bilIings.
The concept of this plan is to help the customer budget
for their utility bi1Is throughout the year by leveling out
seasonal highs and lows in their monthly utility bil1s. The
Customer Assistance Referral and Evaluation Services (CARES)
program provides assisLance to special-needs customers
through access to specifically trained CARES representatives
who provide referrals to area agencies and churches for help
with, among other things, housing, utilities and medical
assistance.
The Low Income Home Energy Assistance Program (LIHEAP)
is a Federal program aimed to assist low income customers
pay their electric and natura1 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 cusLomers who have children, elderly or infirmed
persons living in the household may qualify for the Winter
through February 28,Moratorium p1an.From December I
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I customers are not reguired to pay their bi1ls in full and
2 can defer payment or make partial pa)rments. In addition,
3 the Winter Palrment Plan provides for lower winter biII
4 payments by allowing customers to make monthly payments
5 egual to one-hal-f of the levelized bill amounts, with t.he
6 balance in fu1l or a new payment arrangement due by April
7 1-sE. The Company also works out payment arrangements with
8 customers having difficulty paying their bil1s.
9 fn addition, the Company has convenient opt.ions t.hat
10 help those who need flexibility, but are generally able to
ll pay. APS, or aut.omaLic payment service (money is deducted
12 from a customer's checking account automatically each
13 month), is one example. Other services include debit and
14 credit card service, check-by-phone or over the web,
15 preferred due dat.e (the customer picks a more convenient
16 date to pay than t.he one the Company states on the bill),
17 and e-bi11ing.
18 O. Does that conclude your pre-filed direct testimony?
19 A. Yes, it does.
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