20040212Application.pdf

BARTON L. KLINE ISB #1526
MONICA B. MOEN ISB #5734
Idaho Power Company
O. Box 70
Boise , Idaho 83707
Phone: [phone]
FAX: [phone]
Attorneys for Idaho Power Company
Express Mail Address
1221 West Idaho Street
Boise , Idaho 83702
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UTILI i iC:S CUi'U-iiSSION
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IDAHO POWER COMPANY
Complainant
CITY OF EAGLE, IDAHO
Respondent.
CASE NO. IPC-04-
COMPLAINT TO OBTAIN COMMISSION
ORDER DIRECTING IDAHO POWER TO
CONSTRUCT IMPROVEMENTS TO
SECURE ADEOUA TE SERVICE TO ITS
CUSTOMERS
COMES NOW , Idaho Power Company ("Idaho Power" or the "Company")
and , in accordance with the provisions of Idaho Code ~~ 61-501 , 61-503 and 61-508 and
RP 054 , hereby requests that the Commission issue its Order directing Idaho Power to
construct improvements to its electric transmission system to secure adequate service to
its customers. More specifically, the Company requests that the Commission issue an
Order directing Idaho Power to construct additional 138-kV transmission facilities on one
of two transmission corridors through the City of Eagle , Idaho ("City" or "Eagle ) or, in the
IDAHO POWER'S COMPLAINT, Page
alternative , if the City insists that the needed 138-kV transmission facility be located
underground or on routes other than on the existing transmission corridor routes, that the
Commission order Idaho Power to file tariffs to establish a surcharge to be added to the
rates charged to the Company s customers within the boundaries of the City to recover
the incremental additional costs associated with underground construction or with
construction on the alternative route chosen by the City. This Complaint is based on the
following:
Electric loads in western Ada County have increased significantly in
the last few years. Idaho Power has identified the area surrounding the city of Star
Idaho, as particularly vulnerable to service degradation because the facilities serving that
area are severely strained. While the situation in the Star area has been specifically
identified as critical , electric load growth in the entire Eagle-Star-Meridian area has been
substantial. Serving existing and future electrical loads in this area will require the
construction of several new 138 000 volt (138-kV) sub-transmission facilities into and
within this area. The specific facility at issue in this proceeding is a single pole, single
circuit 138-kV sub-transmission line originating from the existing Eagle Substation and
running to a new substation to be constructed east of the City of Star, Idaho, between
Plummer Lane and Highway 16. The Star Substation site is located approximately 625
feet north of Highway 44. A map showing the alternative routes proposed for the above-
described 138-kV line is attached as Exhibit 1 .
Idaho Power's long-range planning process identified the need for
additional transmission facilities several years ago. In 1999 , Idaho Power met with the
City on several occasions to discuss the need to upgrade the existing 69-kV structures
IDAHO POWER'S COMPLAINT, Page 2
that run through the City to a 138-kV configuration. To comply with the requirements of
the National Electric Safety Code, a 138-kV line with distribution line under-build requires
structures that will exceed the City s 35-foot building height restriction.
In December of 2000 , after numerous discussions with City planning
staff, Idaho Power applied to the City for a conditional use permit (CUP) for the 138-
line and for an exception to the City's 35-foot height restriction. In an attempt to reduce
the overall height of the structures and to eliminate the number of visible conductors in
the downtown business district, the Company proposed to replace the existing 69-
structures with the 138-kV line within the existing corridor containing the 69-kV structures.
The Company also offered to reconstruct a number of distribution lines along the 69-
route to an underground configuration from the Eagle Substation to the present location
of Jackson Square at no additional cost to the City. Additionally, the Company proposed
to bury the overhead distribution lines along the alley located south of State Street
between Eagle Substation and Eagle Road and eliminate the overhead distribution lines
crossing State Street at Second Street and at Eagle Road. By burying the distribution
lines , the total height of the 138-kV structures could be reduced by several feet. The
Company met with City planning staff on several occasions in 2000 to explain its
proposal.
On February 20, 2001 , the Eagle Planning and Zoning Commission
conducted a public hearing on the Company s CUP application. A number of residents
testified in opposition of the proposed 138-kV routing along the existing 69-kV route.
Their opposition was primarily based on the adverse aesthetics of the line within the City'
IDAHO POWER'S COMPLAINT, Page 3
downtown business district. The Planning and Zoning Commission formally
recommended that the City Council deny the Company s application.
Prior to a vote on the CUP by the City Council, at the suggestion of
the City, the Company withdrew the pending application for a CUP and agreed to
undertake a program to obtain additional public input on what should be the preferred
route for the 138-kV line through the City.
As agreed , Idaho Power formed a Community Advisory Committee
(CAC) to assist the Company in evaluating potential routes and identifying important
criteria for selecting the eventual preferred route. The Company held a series of
meetings with the CAC, as well as an open house, to educate the City's residents on the
project scope and need for the 138-kV line. In the course of the meetings with the CAC
the Company received valuable input from the community representatives regarding the
criteria that they believed were important for rating various line route alternatives. In
conjunction with the CAC, the Company conducted quantitative and subjective
evaluations of approximately sixteen different route configurations. The CAC first advised
the Company that it preferred that the 138-kV line be constructed underground through
the City of Eagle. However, when the CAC was advised that the additional cost for
underground construction would be extremely high , in the range of $5 - $6 million , and
that by necessity the additional cost would have to be borne by the residents of the City,
they agreed that the underground alternative was not a viable option. The CAC strongly
advised the Company to avoid locating the line adjacent to residential properties.
Considering the routes using overhead construction through
commercial areas , the CAC's preferred route was to tap the existing 138-kV line at
IDAHO POWER'S COMPLAINT, Page 4
Edgewood , build out to Highway 44, and proceed west within the road right-of-way of
State Highway 44 (the Eagle Bypass) through the commercial areas along Highway 44 to
Ballentyne Road. The line would then follow the existing power line corridor from
Ballentyne Road to the Star Substation. This line route is identified as Alternative #1 on
Exhibit 2 which is attached hereto. Based on the guidance received from the CAC, the
Company held another general public meeting to describe the preferred route selection
process and to take additional public comment. Public comments submitted at that time
still favored an underground solution , but concurred that, among the overhead options
the CAC's preferred route , Alternative #1 , the "Eagle Bypass" route, was the best route to
pursue.
On September 9, 2002, the Company submitted another CUP
application to the City requesting permission to site the 138-kV line on the Eagle Bypass
route. The Planning and Zoning Commission held a public meeting on the proposal on
October 28 , 2002. The hearing was continued until November 13 , 2002 to allow the
Commission to gather additional information. The Planning and Zoning Commission then
requested that the City Council authorize funding for a study by an independent
engineering consulting firm to evaluate the costs and feasibility of constructing the 138-
line underground. The City hired Black and Veatch to conduct the study. Black and
Veatch's study was presented to the Eagle City Council on July 15 , 2003. In its study,
Black and Veatch advised the City that 1.6 miles of 138-kV underground construction
would cost approximately $9.5 million , or approximately $9 million more than the
overhead alternative.
IDAHO POWER'S COMPLAINT, Page 5
On July 15, 2003, the City's Planning and Zoning Commission held a
public hearing in which the results of the Black and Veatch study were considered in
conjunction with the Company s CUP application. On September 8 2003, the City'
Planning and Zoning Commission issued its recommendation that the City Council deny
the Company s application primarily on the grounds that the line would be unsightly and
would have an adverse effect on the commercial development taking place at the junction
of Highway 44 and Eagle Road. On October 14, 2003 , the Eagle City Council took up the
Company s application , including the Planning and Zoning Commission s recommended
denial of the application. A public hearing was held and testimony was received. A
number of citizens and commercial developers testified that the Bypass route was
aesthetically unfavorable and, in their opinion, could adversely affect commercial property
values in the area. The public hearing was continued until October 28, 2003. At the
October 28 meeting, the City Council remanded the application back to the planning Staff
for further evaluation of alternatives and information gathering. At that time, Idaho Power
representatives advised the City Council that construction lead times would not allow for
extensive evaluations. Because four years had elapsed since Idaho Power s initial
contacts with the City on this matter, the situation had become critical.
10.On January 12, 2004, representatives of Idaho Power and the City of
Eagle met informally with representatives of the IPUC Staff to discuss the situation. At
the conclusion of the meeting, Idaho Power agreed to immediately meet with
representatives from the City to address the feasible alternative routes one more time and
to present cost estimates for these alternative routes.
IDAHO POWER'S COMPLAINT, Page 6
11.On January 21 2004, representatives of Idaho Power again met with
the Mayor and members of the City's land use planning staff to discuss the routing
alternatives and their associated costs. A copy of the information presented to the City is
attached as Exhibit 3.
12.As shown on Exhibit 3 , Idaho Power presented six alternative
proposals to the City. In developing its proposals, Idaho Power followed the philosophy
that, if the City desired to have the line located on a route that materially increased the
cost to Idaho Power, then the City and its citizens should bear the incremental
difference in cost between routing the line in an overhead configuration on one of the
two current transmission corridors and the cost of underground construction or
overhead construction on one of the more aesthetically acceptable alternative routes
preferred by the City.
13.As shown on Exhibit 3, alternatives 1 , 2 and 3 involve no additional
cost to the City of Eagle. Alternatives 4, 5 and 6 involve a contribution from the City to
offset the additional cost associated with the City s preferred routing. Alternatives 5 and
6 involve routing the line adjacent to residential properties. The alternative of
constructing the 138-kV line underground was not discussed with the City at the
January 21 , 2004 meeting. If the City still desires to pursue underground construction
the additional incremental cost would not be less than $5 - $6 million and could be as
much as $9 million.
14.Idaho Power believes it is appropriate to require the City to
contribute to the additional cost associated with a line routing or with underground
facilities that would substantially increase the cost of the 138-kV facilities. If the City
IDAHO POWER'S COMPLAINT, Page 7
does not bear that incremental additional expense, Idaho Power s other customers will
ultimately pay higher rates as a result of the City s dissatisfaction with the aesthetics of
overhead transmission facilities located within existing transmission corridors through
the City. Such increased cost would ultimately result in the Company s other customers
paying rates that are unjust , unreasonable , discriminatory and preferential. Idaho
Power is requesting that the Commission exercise its statutory authority to prevent such
a result.
15.The Company s service territory in western Ada County is
experiencing substantial real estate development and commercial growth. With that
growth and development comes rapidly-increasing electrical loads. Idaho Code ~ 61-302
obligates Idaho Power to serve those loads in a manner that is efficient, just and
reasonable. The Commission is legally authorized to "do all things necessary to carry out
the spirit and intent of the provisions of this act." (Idaho Code, ~ 61-501). The
Commission is also charged with ensuring that the rates that Idaho Power charges its
customers are just and reasonable and are not discriminatory or preferential. (Idaho
Code, ~ 61-503).
16.For the past four years, Idaho Power has been working diligently to
secure land use planning permissions from the City to construct a 138-kV sub-
transmission line on one of the existing transmission corridors. While the Company
believes that the City at all times has acted in good faith , nevertheless , the City has
refused to grant the requested land use planning authorizations on the grounds that the
proposed 138-kV line is unsightly and should either be constructed underground or
located on a route that bypasses the central business district. Either of these alternatives
IDAHO POWER'S COMPLAINT, Page 8
would substantially increase the cost of the line as compared to the cost of using the
existing transmission corridors.
17.Idaho law clearly contemplates that the Commission has the
authority to address the concerns raised by Idaho Power in this pleading. Idaho Code
~ 61-508 provides in pertinent part that:
Whenever the commission , after hearing had upon its own motion
or upon complaint, shall find that additions , extensions, repairs or
improvements to or changes in the existing plant, scales
equipment, apparatus , facilities or other physical property of any
public utility. . . ought reasonably to be made , or that a new
structure or structures should be erected to promote the security
or convenience of . . . the public , or in any other way to secure
adequate service or facilities, the commission shall make and
serve an order directing such additions , extensions , repairs
improvements or changes be made or such structure or structures
be erected in the manner and within the time specified in said
order.
18.Idaho Code ~ 61-501 provides:
The public utilities commission is hereby vested with power and
jurisdiction to supervise and regulate every public utility in the
state and to do all things necessary to carry out the spirit and
intent of the provisions of this act.
19.Title 67 of the Idaho Code addresses local land use planning.
Idaho Code ~ 67-6528 provides in pertinent part:
If a public utility has been ordered or permitted by specific order
pursuant to Title 61 , Idaho Code , to do or refrain from doing an
act by the public utilities commission , any action or order of a
governmental agency pursuant to Titles 31 , 50 or 67, Idaho Code
in conflict with said public utilities commission order, shall be
insofar as it is in conflict, null and void if prior to entering said
order, the public utilities commission has given the affected
governmental agency an opportunity to appear before or consult
with the public utilities commission with respect to such conflict.
IDAHO POWER'S COMPLAINT, Page 9
Idaho Code ~~ 61-508 and 67-6528 clearly demonstrate that the Idaho
Legislature intended that the Commission have the authority to grant the relief prayed
for in this complaint. The Legislature has declared that the Commission has exclusive
power to regulate public utilities and has vested it with the authority to carry out its
regulation. Any other scheme would place the utility and the general body of utility
customers in an untenable situation. Local governmental agencies could require
utilities to expend unreasonably large amounts of money to satisfy local aesthetic
concerns. Those additional expenses would then be passed on to all of the utility
other customers thereby resulting in unreasonable , preferential and discriminatory
rates.
20.Idaho Power has discussed with the City possible ways that the
City could fund the additional costs associated with the more aesthetically pleasing
routings it prefers. Idaho Code Title 50 allows mayors and city councils to create local
improvement districts to fund line extensions or to fund conversion of existing overhead
electric facilities to an underground configuration.
21.In addition, Idaho Power would be willing to accept installment
payments, including interest, to recover the additional costs if the City chooses to
proceed with route options 4, 5 or 6 shown on Exhibit 3. It should be noted that Idaho
Power is offering to contribute the amount of $476 000 to reduce the cost the City
would experience under alternatives 3 through 6. The City could fund the installment
payments by applying the proceeds of the franchise fees it collects from Idaho Power to
make the installment payments. The City currently levies a franchise fee at the 1 %
level, but that level could be increased if such an increase is acceptable to the citizens
IDAHO POWER'S COMPLAINT, Page 10
of the City. This is the procedure Idaho Power followed with the City of Ketchum
Idaho , when Ketchum desired to relocate Idaho Power s overhead power lines in
downtown Ketchum to an underground configuration. The difference in cost was
funded by the City of Ketchum using franchise fee proceeds.
22.Idaho Power has made extraordinary efforts to accommodate the
City of Eagle s concerns. Unfortunately, the long period of time it has taken to reach the
current point of impasse with the City has placed Idaho Power in an precarious situation.
The Company s current analyses indicate that, unless the 138-kV line is constructed and
available for service by May of 2005 , the risk of service degradation in the Star-Eagle
area in the summer of 2005 is material. Final design, materials procurement and
construction of a 138-kV line, depending on the route , can require a year or more from
start to finish. This is why the Company is requesting that the Commission consider this
request on an expedited basis.
23.If the City is unwilling to grant the requested zoning permission or
enter into a contract to voluntarily fund the differential in cost to satisfy the City
aesthetic concerns, Idaho Power respectfully requests that the Commission issue its
order as follows:
Ordering Idaho Power to construct the 138-kV line on its choice of
route options 1 , 2 or 3 with no additional cost being attributable to the City of Eagle or
In the alternative, if the City of Eagle requires that the line be
constructed underground or on route options 4 , 5 or 6, that the Company be ordered to
file tariffs to be applicable within the boundaries of the city limits of the City of Eagle
which would impose a surcharge on the electric rates of the citizens of the City of
IDAHO POWER'S COMPLAINT, Page
Eagle. The proceeds of that surcharge would be used to amortize the incremental
increase in cost for underground construction or for the route selected by the City over
a reasonable period of time not to exceed ten (10) years.
Idaho Power requests that the Commission convene a prehearing
conference in this matter at its earliest convenience and consider this request on an
expedited basis.
DATED at Boise, Idaho, this 11 th day of February, 2004.
BARTON L. KLINE
Attorney for Idaho Power Company
IDAHO POWER'S COMPLAINT , Page 12
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