20030725Comments.pdf

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DONALD L. HOWELL, II
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720-0074
[phone]
IDAHO BAR NO. 3366
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2003 JUL 25 Pr1 3: 35
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UTlLiT IES COt"lhiSSiON
Street Address for Express Mail:
472 W. WASHINGTON
BOISE, IDAHO 83702-5983
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF
UNITED ELECTRIC CO-, INC. AND THE
CITY OF BURLEY FOR AN ORDER
APPROVING A SERVICE TERRITORY
AGREEMENT PURSUANT TO IDAHO CODE
~ 61-333(1).
CASE NO. GNR-O3-
COMMENTS OF THE
COMMISSION STAFF
COMES NOW the Staff of the Idaho Public Utilities Commission, by and through its
attorney of record, Donald L. Howell, II, Deputy Attorney General, and submits the following
comments in response to Order No. 29289 issued on July 9 2003.
APPLICATION
On June 20, 2003 , United Electric Co-op, Inc. and the City of Burley filed an Application
for approval of a Service Territory Agreement pursuant to the Idaho Electric Suppliers
Stabilization Act (ESSA). United is the successor entity following the consolidation of Rural
Electric Company and Unity Light & Power. Both United and the City supply electric service to
their respective consumers in adjacent and contiguous service territories. Idaho Code ~ 61-
332A(4).
STAFF COMMENTS JULY 25, 2003
The parties asked the Commission to approve their "Territory Service Agreement" dated
May 21, 1985, and two subsequent "amendments" dated November 19, 1996 1 and May 6 2003
respectively. The 1985 Agreement and its subsequent amendments establish service territories
for each party. The Agreement and the amendments also recognize that the parties serve
customers located in the other party s service area. The Application states that the initial
Agreement and the two amendments were negotiated to settle and establish service territories
between the parties, to provide stability and safety in service to consumers, and to eliminate
duplication of services. Application at ~
The 1996 amendment provides that the City shall have the right to install its own
streetlights, pumps and other facilities for the delivery of city services located within United'
service territory. Exhibit No. 2, ~ 8. United also agrees to deliver electrical service to the City
facilities within United's service area.
STAFF COMMENTS
In December 2000 and February 2001 , the Idaho Legislature amended portions of the
ESSA. In particular Idaho Code ~ 61-333 was amended to provide that all service agreements
that allocate territory or customers between electric suppliers be filed with the Commission.
Idaho Code ~ 61-333(1) now provides in pertinent part that
the commission shall after notice and opportunity for hearing, review and
approve or reject (such) contracts.. ..between municipalities and cooperatives....
The commission shall approve such contracts only upon finding that the allocation
of territories or consumers is in conformance with the provisions and purposes of
this act.
Idaho Code ~ 61-333(1) (2001). As set out more fully in Idaho Code ~ 61-332, the
purposes of the ESSA are to: (1) promote harmony among and between electric suppliers; (2)
prohibit the "pirating" of consumers served by another supplier; (3) discourage duplication of
electric facilities; (4) stabilize the territory and consumers served by the suppliers; and, (5)
actively supervise certain conduct of the suppliers.
1 The fIrSt amendment (identified as Exhibit No.2) is actually a "Service Area Agreement" entered into between
Rural Electric Company and the City of Burley. As previously mentioned, United is the successor to Rural Electric.
This Agreement superseded a Service Area Agreement between Burley and Rural Electric dated June 6, 1988.
STAFF COMMENTS JULY 25 2003
The Agreement appears to provide the least cost service option for customers and
complies with the ESSA by drawing boundaries that partially identify each supplier s service
territory. Staff believes that the Agreement contained in this Application fulfills the purposes
and provisions of the ESSA that have been previously stated.
Paragraph 7 of the 1996 Agreement provides for the parties to the exchange United'
customer Norco with the City s customer Ag-West. United has advised the Staff that the
exchange was completed in the summer of 2002. Under these circumstances, granting an
exception" to the anti-pirating provision of the ESSA appears reasonable when considering the
purposes of the ESSA. Idaho Code ~ 61-334B(1).
Finally, Staff notes that Paragraph 13 of the 1996 Agreement provides that the prevailing
party in any action arising under the Agreement is entitled to recover reasonable attorney fees.
Prior to the aforementioned modifications to the ESSA Idaho Code ~ 61-334B provided that any
supplier whose rights under the ESSA are in jeopardy, may bring suit in district court. This
section was repealed and amended in December 2000 and February 2001.
Idaho Code ~ 61-334A now provides that an aggrieved customer or supplier "may file a
complaint with the commission" and the Commission shall resolve the matter. See Idaho Code
~~ 61-334A(2-3); 61-334B(3). In other words, resolution of disputes was removed from the
court's jurisdiction and was to be submitted to the Commission. Under the Public Utilities Law
the Commission does not have authority to award attorney fees other than intervenor funds
pursuant to Idaho Code ~ 61-617A. See Idaho Power Company v. Idaho PUC 102 Idaho 744
639 P.2d 442 (1981).
STAFF RECOMMENDATION
Staff recommends approval of the Agreement.
Respectfully submitted this of)....Z -oJ day
Donald L. well, II
Deputy Attorney General
Technical Staff: Keith Hessing
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STAFF COMMENTS JULY 25 2003
CERTIFICATE OF SERVICE
HEREBY CERTIFY THAT I HAVE THIS 25TH DAY OF mLY 2003
SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF, IN CASE
NO. GNR-03-, BY MAILING A COpy THEREOF, POSTAGE PREPAID, TO THE
FOLLOWING:
WILLIAM A PARSONS
PARSONS SMITH & STONE LLP
PO BOX 910
BURLEY ID 83318
MAILED TO:
wparsons~pmt.org
RC STONE
P ARSONS SMITH & STONE LLP
PO BOX 910
BURLEY ID 83318
MAILED TO:
rcstone~pmt.org
SECRETARY
CERTIFICATE OF SERVICE