20210602Comments.pdf

DAYN HARDIE
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 9917
Street Address for Express Mail:
I I33I W CHINDEN BLVD, BLDG 8, SUITE 201-A
BOISE, ID 83714
Attomey for the Commission Staff
BEFORB THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF AVISTA'S ANNUAL
RATE ADJUSTMENT FILING FOR
ELECTRIC LINE EXTENSION SCHEDULE
51
CASE NO. AVU.E.21.O3
COMMENTS OF THE
COMMISSION STAFF
STAFF OF the Idaho Public Utilities Commission ("Staff'), by and through its Attorney
of record, Dayn Hardie, Deputy Attomey General, submits the following comments.
BACKGROUND
On March 29,2021, Avista Corporation dba Avista Utilities ("Company") applied for
Commission approval to update costs to the Company's Electric Line Extension Schedule 51. In
Order No. 28562, the Commission directed Avista to update its Schedule 51 charges on or before
April I of each year. The Company proposes updates to the basic costs based on 2020 material
and equipment costs but is not proposing to update the construction allowances in this case and
states it will update the construction allowances following the conclusion of its next general rate
case. The Company requested a May 15,2021effective date, but the Commission suspended the
date until July 1 ,2021to allow adequate time to comment on the case.
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ISTAFF COMMENTS JLINE 2,2021
STAFF ANALYSN
Staff reviewed the Company's Application. As a result of its investigation, Staff
concludes the Company's method for calculating average costs is consistent with past Schedule
51 filings and believes that the proposed basic costs are reasonable.
Basic Costs
Staff has reviewed the filing, including the workpapers provided, and agrees with the
changes to basic costs. Basic costs are calculated using recent average actual costs for facilities
including transformers and conduit. The Company has consistently used this method to
determine its line extension tariffs, including prior versions of Schedule 51. The Company
proposes to update the primary, secondary, service, and transforner average costs. Residential
development costs are also updated for the most current Construction Standardsl and average
2020 construction costs. The current and proposed basic costs are shown in Table No. I below.
I The Construction and Material Standards comply with the 2017 National Electric Safety Code.
STAFF COMMENTS 2 JI.TNE 2,202I
Table No. 1: Basic Costs - Present and Proposed Cost of Facilities
Sinele Phase Current Proposed
Overhead Primary Circuit:
Fixed Cost $4,205 54,677
Variable Cost 58.22 $9.17
Underground Circuit
Fixed Cost $1,934 $1,920
Variable Cost $11.34 $10.01
Underground Secondary Circuit
Fixed Cost $428 $394
Variable Cost $10.47 $8.60
Overhead Secondary Circuit
Fixed Cost $1,732 $1,936
Overhead Service Circuit
Variable Cost Only $3.74 $4.27
Underground Service Circuit
Variable Cost Only $9.54 S8.43
Overhead Transformer
Fixed Cost Only 52,242 $2,345
Padmount Transformer
Fixed Cost Only $3,546 $3,477
Difference
$472
$0.9s
($14)
($1.33)
($3+;
($ 1.87)
$204
$0.s3
($1.11)
$ 103
($6e;
The major drivers affecting changes in average cost were decreased vehicle usage and a
business process improvement that changes how vehicle rates are applied in the Company's
workorder system. Application at 4-5. The average cost for overhead circuit costs increased
from 1 1.2%o to 14.2% this year compared with last year's costs. In the Company's response to
Staff s Production Request No. l, the Company states the reason for decreased vehicle usage is
due to the cyclical nature of construction projects and operational changes. From Staff s review
of vehicle usage in overhead electrical work during the last three years, Staff believes the
Company's explanation for the decrease in vehicle usage is reasonable.
JSTAFF COMMENTS JUNE 2,2021
The decrease in the underground costs relates to the business process improvement,
which reallocated costs in the Company's workorder system and more closely aligns with how
vehicles are being utilized in the field. Application at 5. The business process improvement had
a greater effect on underground costs than it did on overhead costs. Production Request
Response No. 1. Staff believes the decrease in underground costs is reasonable.
Re s ident i al Development s
Staff analyzed the Company's method for calculating residential development costs and
determined it is consistent with the Commission authorized method in Order No. 28562.
Developers are responsible for the basic cost of a development, which can be refunded as new
customers receive service within five years from the date the extension is completed. The basic
cost represents the cost of a development line extension minus the cost of service line extensions
within the development. It is computed by subtracting the average service cost from the average
total cost per lot. A builder must pay the difference between the average total cost per lot and the
allowance. The proposed builder non-refundable payment in this case is zero because the
Company's allowance exceeded the average total cost per lot. The current and proposed
residential amounts are found in Table No. 2.
Table No. 2: Present and Proposed Residential Payment Amounts
Residential Developments Current Proposed
Total Cost per Lot $1,938 $1,772
Less: Service Cost $478 $422
Developer Responsibility (Basic Cost) $1,460 $1,350
Developer Refundable Payment $1,460 $1,350 ($l lo)
$ 1,938
$1.900
s38
$1,772
$1.900
$0
Difference
($166)
($s6)
($l l0)
($166)
$0
($3s1
Average Total Cost per Lot
Less: Allowance
Builder Non-Refundable Payment
4STAFF COMMENTS JLINE 2,2027
CUSTOMER NOTICE
The Company's customer notice was included with its Application. Staff reviewed the
document and determined that it meets the requirements of Rule 125 of the Commission's Rules
of Procedure (IDAPA 31.01.01). The notice was mailed to the relevant customers on April 12,
2021, providing a reasonable opportunity to file timely comments with the Commission by the
June 2, 2021 comment deadline. As of June 1,2021, the Commission has received no comments
from customers.
STAFF RECOMMENDATION
Staff believes the Company's proposals are reasonable and conform with Commission
Order No. 28562. Staff recommends the Company's proposed costs be approved.
Respecttully submitted this L& day of June 2021.
Dayn Hardie
Deputy Attorney General
Technical Staff: Michael Eldred
Travis Culbertson
Kevin Keyt
Curtis Thaden
i:umisc/comments/avue2 l.03dhmeksktncct comments
5STAFF COMMENTS JI.INE 2,2021
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS 2ND DAY oF JUNE 2021, SERVED
THE FOREGOING COMMENTS OF' THE COMMISSION STAFF, IN CASE NO.
AVU.E-21-03, BY E-MAILING A COPY THEREOF TO THE FOLLOMNG:
DAVID J MEYER
VP & CHIEF COUNSEL
AVISTA CORPORATION
PO BO)( 3727
SPOKANE WA99220-3727
E-mail : [e-mail]
avi stadockets @av i stacorp. com
PATRICK EHRBAR
DIR OF REGULATORY AFFAIRS
AVISTA CORPORATION
PO BOX3727
SPOKANE W499220-3727
E-mail: [e-mail]
SECRET Y
CERTIFICATE OF SERVICE