20211102Notice_of_Application_Order_No_35215.pdf

NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 35215 1

Office of the Secretary
Service Date
November 2, 2021

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

On October 22, 2021, Commission Staff applied to update the cost of capital inputs
used in the Surrogate Avoided Resource model (“SAR model”) for Avista Corporation (“Avista”).
Under the Public Utility Regulatory Policies Act of 1978 (“PURPA”), the Commission calculates
published avoided cost rates for PURPA qualifying facilities (“QFs”) using the SAR Method for
all three major public electric utilities in Idaho: Avista, Idaho Power, and PacifiCorp dba Rocky
Mountain Power.
The Commission now issues this Notice of Application and sets deadlines for interested
persons to comment on the Application, and for Commission Staff to reply.
NOTICE OF APPLICATION
YOU ARE HEREBY NOTIFIED the Commission calculates and publishes SAR
Method rates for QFs that are under the applicable resource type project eligibility cap. The SAR
Model uses each utility’s approved cost of capital from their last general rate case. On September
1, 2021, the Commission issued Order No. 35156 in Avista’s most recent general rate case (Case
No. AVU-E-21-01). That order triggered a necessary update of Avista’s cost of capital inputs in
the SAR Model.
YOU ARE FURTHER NOTIFIED that Avista’s cost of debt changed from 5.2% to
4.70%, and its cost of common equity changed from 9.5% to 9.40%. As a result, the weighted cost
of capital—which depends on the cost of debt and the cost of common equity—changed from
7.35% to 7.05%.
YOU ARE FURTHER NOTIFIED that Staff first updated several inputs to Avista’s
SAR Model.
IN THE MATTER OF COMMISSION
STAFF’S APPLICATION TO UPDATE
AVISTA CORPORATION’S COST OF
CAPITAL INPUTS IN THE SURROGATE
AVOIDED RESOURCE METHOD
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CASE NO. AVU-E-21-16

NOTICE OF APPLICATION

NOTICE OF
MODIFIED PROCEDURE

ORDER NO. 35215
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 35215 2

YOU ARE FURTHER NOTIFIED that attached to the Application are: (1) an updated
SAR Model incorporating the proposed updates; (2) Avista’s Avoided Cost Rates for New
Contracts; and (3) Avista’s Avoided Cost Rates for Renewal Contracts.
YOU ARE FURTHER NOTIFIED that the Application is available for public
inspection during regular business hours at the Commission’s office. These documents are also
available on the Commission’s website at www.puc.idaho.gov. Click on the “ELECTRIC” icon,
select “Open Cases,” and click on the case number as shown on the front of this document.
YOU ARE FURTHER NOTIFIED that all proceedings in this case will be held
pursuant to the Commission’s jurisdiction under Title 61 of the Idaho Code.
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be conducted
pursuant to the Commission’s Rules of Procedure, IDAPA 31.01.01.000 et seq.
NOTICE OF MODIFIED PROCEDURE
YOU ARE FURTHER NOTIFIED that the Commission has determined that the public
interest may not require a formal hearing in this matter and will proceed under Modified Procedure
pursuant to Rules 201 through 204 of the Idaho Public Utilities Commission’s Rules of Procedure,
IDAPA 31.01.01.201 through .204. The Commission notes that Modified Procedure and written
comments have proven to be an effective means for obtaining public input and participation.
YOU ARE FURTHER NOTIFIED that people desiring to state a position on this
Application may file a written comment explaining why the person supports or opposes the
Application. Persons who would like a hearing must specifically request a hearing in their written
comments. Persons interested in filing written comments must do so within twenty-one (21)
days of the service date of this Order. Comments must be filed through the Commission’s
website or by e-mail unless computer access is unavailable. To comment electronically, please
access the Commission’s website at www.puc.idaho.gov. Click the “Case Comment Form” and
complete the form using the case number as it appears on the front of this document. To file by e-
mail, the customer must e-mail the comment to the Commission Secretary and the Commission
Staff at the e-mail addresses listed below. If computer access is unavailable, then comments may
be mailed to the Commission Secretary and the Commission Staff at the following addresses:
NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 35215 3

YOU ARE FURTHER NOTIFIED that Commission Staff must file any reply
comments within twenty-eight (28) days of the service date of this Order.
YOU ARE FURTHER NOTIFIED that if no written comments or protests are received
within the time limit set, the Commission will consider this matter on its merits and enter its order
without a formal hearing. If written comments are received within the time limit set, the
Commission will consider them and, in its discretion, may set the same for formal hearing.
O R D E R
IT IS HEREBY ORDERED that this Application be processed by Modified Procedure,
Rules 201-204 (IDAPA 31.01.01.201-.204). Persons interested in submitting written comments
must do so within twenty-one (21) days of the service date of this Order. Commission Staff must
file any reply comments within twenty-eight (28) days of the service date of this Order.
IT IS FURTHER ORDERED that parties should continue to comply with Order No.
35058, issued June 3, 2021. All pleadings should be filed with the Commission electronically and
shall be deemed timely filed when received by the Commission Secretary. See Rule 14.02. Service
between parties should also be accomplished electronically. Voluminous discovery-related
documents may be filed and served on CD-ROM or a USB flash drive.
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For the Idaho Public Utilities
Commission:

Commission Secretary
Idaho Public Utilities Commission
P.O. Box 83720
Boise, Idaho 83720-0074
[e-mail]

Street Address for Express Mail:

11331 W. Chinden Blvd.
Building 8, Suite 201-A
Boise, Idaho 83714

For Commission Staff:

Riley Newton
Deputy Attorney General
Idaho Public Utilities Commission
P.O. Box 83720
Boise, Idaho 83702-0074
[e-mail]

NOTICE OF APPLICATION
NOTICE OF MODIFIED PROCEDURE
ORDER NO. 35215 4

DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 2nd day
of November 2021.

PAUL KJELLANDER, PRESIDENT

KRISTINE RAPER, COMMISSIONER

ERIC ANDERSON, COMMISSIONER

ATTEST:

______________________
Jan Noriyuki
Commission Secretary

I:\Legal\ELECTRIC\AVU-E-21-16 SAR\Orders\AVUE2116_ntc app_mod_rn.docx