20190910Comments.pdf

DAYN HARDIE
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 9917
R EC E IVED
2019 SEp t0 plt t: !3
. i ,, IJ{J F)UTLIC,.I ; :I:r CO.l.II,IISSICN
Street Address for Express Mail:
472W. WASHINGTON
BOISE, IDAHO 83702-5918
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE RESIDENTIAL AND
SMALL FARM ANNUAL RATE ADJUSTMENT
FILING OF AVISTA CORPORATION.
CASE NO. AVU-E-19-08
COMMENTS OF
COMMISSION STAFF
COMES NOW the Staff of the Idaho Public Utilities Commission, by and through its
attorney of record, Dayn Hardie, Deputy Attorney General, and in response to the Notice of
Application and Modified Procedure issued in Order No.34422 on August 23,2019, in Case No.
AVU-E-I9-08, submits the following comments.
BACKGROUND
On July 30,2019, Avista Corporation dba Avista Utilities applied to the Commission for
authorization to implement a Residential and Small Farm Energy rate credit, for Rate Schedules
1,12,22,32, and 48, of 0.387 cents per kilowatt-hour. Avista requested that the Application be
processed under Modified Procedure and requests an effective date of October 1,2019. The
proposed rate credit would be effective through September 30,2020. The Company files its
Residential and Small Farm Energy rate credit on an annual basis to adjust this rate based on
how much of the credit is amortized throughout the year.
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ISTAFF COMMENTS SEPTEMBER 10,2019
The current Residential and Small Farm credit rate is 0.069 cents per kilowatt-hour. The
proposed credit rate of 0.387 cents per kilowatt-hour is designed to pass through approximately
$4.8 million which is the Idaho jurisdictional share of BPA benefits starting October 1,2019.
The increased credit results in an overall decrease to qualifying customers under the proposed
credit rate of $3.9 million, or 1 .6oh. The change in the credit rate does not affect the Company's
net income. The proposed rate change results in a monthly bill decrease of $2.86 for an average
residential customer using 898 kwh per month - approximately three and a half percent (35%).
The Company provides workpapers for the calculation of the Residential and Small Farm
Energy credit rate in Attachment A to its Application. The Company also provides a copy of the
proposed tariff, Schedule 59, containing the new rate credit.
STAFF ANALYSIS
The Residential and Small Farm Energy credit rate results from an agreement between
the Company and the Bonneville Power Administration ("BPA") regarding the Residential
Exchange Program ("REP"). The Residential Exchange Program provides a share of the benehts
of the federal Columbia River power system to the residential and small-farm customers of the
six investor-owned utilities of the Pacific Northwest, including Avista. The BPA credit is
allocated between Washington and Idaho and based on the actual usage in each jurisdiction.
The calculation of the BPA benefit for residential and small farm customers has two
inputs. The first, is usage by Avista's residential and small farm customers over the previous two
years, 20T6 and2017. These are averaged to create an annualized usage figure. The seconcl, is
the difference between two variables calculated by BPA: Avista's Average System Cost rate and
the Priority Firm Exchange Rate. These variables are calculated by BPA every two years. The
difference between these rates is multiplied by the annualized usage to calculate the BPA benefit
to be passed on to qualifying customers for the next two years.
Avista's Residential and Small Farm Credit rate is calculated by taking the projected
remaining balance of the BPA benefit from the previous year and adding the BPA benefit for the
next year. The total is then divided by the projected annual kWh sales to residential and small
farm customers to calculate the rate.
2STAFF COMMENTS SEPTEMBER IO,2019
Staff reviewed the methodology and calculation of the proposed Residential and Small
Farm Credit rate and the approach is consistent with the terms and conditions of Schedule 59 -
Residential and Farm Energy Rate Adjustment - Idaho. Staff recommends the proposed rate of
0.387 cents per kilowatt-hour be approved.
CUSTOMER NOTICE AND PRESS RELEASE
The Company's press release and customer notice were included with its Application.
Each document addresses two cases: this case (AVU-E-l9-08) and the Power Cost Adjustment
(AVU-E-19-09). Staff reviewed the documents and determined both meet the requirements of
Rule 125 of the Commission's Rules of Procedure. See IDAPA 31.01.01.125. The notice was
included in bills mailed to customers beginning August 16,2019.
For this case, the Commission set a comment deadline of September 10, 2019. Because
the customer notices were not inserted into the bills until August 16,2019, some customers in the
last billing cycles will not have received their notices or had adequate time to submit comments
before the deadline. Customers must have the opportunity to file comments and have those
comments considered by the Commission. Staff recommends that the Commission accept late-
filed comments from customers. As of September 9,2079, no comments had been filed in this
case
RECOMMENDATION
Staff recommends the following:
1. The Commission approve the new Residential and Farm Energy Rate
Schedule 59, with a credit rate of 0.387 cents per kilowatt-hour, effective
October 1,2019 through September 30,2020.
2. The Commission accept late-filed comments from customers.
JSTAFF COMMENTS SEPTEMBER 1O,20I9
Respectfully submitted this /O * day of September 2019.
Davn
Deputy Attorney General
Technical Staff: Bentley Erdwurm
Travis Culbertson
Jolene Bossard
i : umisc:comments/avue I 9. 8dhbetncjb comments
4STAFF COMMENTS SEPTEMBER IO,2O19
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS IOth DAY OF SEPTEMBER 2019,
SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN
CASE NO. AVU-E-I9-08, BY MAILING A COPY THEREOF, POSTAGE PREPAID,
TO THE FOLLOWNG:
PATRICK EHRBAR
DIRECTOR REGULATORY AFFAIRS
AVISTA CORPORATION
PO BOX 3727
SPOKANE WA99220-3727
E-mail: [e-mail]
DAVID J MEYER
VP & CHIEF COLINSEL
AVISTA CORPORATION
PO BOX3727
SPOKANE WA99220-3727
E-mail : [e-mail]
SECRET
CERTIFICATE OF SERVICE