20030724Comments.pdf

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 -1UI- 24 PN '1: 21
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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-OP, INc. AND THE
FARMERS ELECTRIC COMPANY, LTD FOR
AN ORDER APPROVING A SERVICE
TERRITORY AGREEMENT PURSUANT TO
IDAHO CODE ~ 61-333(1).
CASE NO. GNR-O3-
STAFF COMMENTS
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. 29284 issued on July 8, 2003.
APPLICATION
On June 20, 2003 , United Electric Co-op, Inc. and The Farmers Electric Company filed
an Application for approval of a Service Territory Agreement pursuant to the Idaho Electric
Supplier Stabilization Act (ESSA). United is the successor entity following the consolidation of
Rural Electric Company and Unity Light & Power. Both Co-operatives supply electric service to
their respective consumers in adjacent and contiguous service territories.
On April 23 , 2003 , United and Farmers' entered into their Stabilization Agreement. In
the Agreement, the parties established separate territories for each party. Each party is
responsible for serving all new customers in their defined service areas. Exhibit No.1 at ~ 2. To
the extent that either party is currently providing services to consumers within the service area
STAFF COMMENTS JULY 24, 2003
assigned to the other party, the existing supplier shall continue to serve these pre-existing
customers. !d. at ~ 3; Exhibit No.
The Agreement also states that there may be instances where it is more efficient for a new
customer located in one service territory to be served by the other electric supplier. In such
cases, the parties may enter
into a written agreement to permit the service of a new customer by (the)
party whose distribution system is located in the service area of the other
supplier). . .. Such agreement shall be in writing, authorized by the
respective governing board of each party, and when executed shall be
appended to this agreement. The entering into such agreement is
discretionary with either party and neither party shall have the right of
action against the other for the exercise of such discretion.
Id. at ~ 6.
ST AFF COMMENTS
In December 2000 and February 2001 , the Idaho Legislature amended portions of the
ESSA. In particular Idaho Code g 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 g 61-333(1) now provides in pertinent part that
the commission shall after notice and opportunity for hearing, review
and approve or rej ect ( such) contracts, between 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 g 61-333(1) (2001). As set out more fully in Idaho Code g 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.
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 fulfils the purposes and
provisions of the ESSA that have been previously stated.
STAFF COMMENTS JULY 24, 2003
The Agreement also provides:
To the extent that either party is currently providing service to customers
within the service area assigned to the other party by this agreement, said
parties shall continue to serve said customer.
Id. at ~ 3; Exhibit No.
Finally, Staff notes that Paragraph 5 of the 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 g 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 g 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
gg 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 g 61-617 A. See Idaho Power Company v. Idaho PUC 102 Idaho 744
639 P.2d 442 (1981).
STAFF RECOMMENDATION
Staff recommends approval of the Agreement.
J/fL.
Respectfully submItted thIS
Donald L. well, II
Deputy Attorney General
Technical Staff: Keith Hessing
i: :umisc/comments/gnrtO3 ,7 dhkh
STAFF COMMENTS JULY 24, 2003
CERTIFICATE OF SERVICE
HEREBY CERTIFY THAT I HAVE THIS 24TH DAY OF JULY 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
P ARSONS SMITH & STONE LLP
PO BOX 910
BURLEY ID 83318
MAILED TO:
wparsons~pmt.org
GOODMAN & BOLLAR
PO BOX D
RUPERT ID 83350
CERTIFICATE OF SERVICE