20060324Decision memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
CO MMISSI 0 NER SMITH
CO MMISSI 0 NER HANSEN
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM:DONOVAN E. WALKER
DATE:MARCH 24, 2006
SUBJECT:INVESTIGATION OF THE APPROPRIATE RA TEMAKING
TREATMENT OF IDAHO POWER COMPANY'S S02 ALLOWANCE
SALE PROCEEDS - CASE NO. IPC-05-
BACKGROUND
On June 9, 2005 , Idaho Power Company (Idaho Power, Company) filed an
Application requesting: (1) blanket authority to sell surplus sulfur dioxide (S02) allowances;
and (2) an accounting order to provide for recording any sale(s) of such allowances. Case No.
IPC-05-20. The Company s Application also suggested that a determination of ratemaking
treatment for the proceeds be made at a later date.
On August 22, 2005, the Idaho Public Utilities Commission (Commission) approved
the Company s Application. Order No. 29852. The Commission, while reserving the review of
the reasonableness of each sale, granted Idaho Power s request for blanket authority to sell S02
emissions allowances and approved the accounting treatment proposed by the Company, on an
interim basis, until such time as the Commission determines the appropriate ratemaking
treatment of the proceeds from the sale of the S02 allowances. Id. The Company was ordered
to file a report with the Commission within 60 days of the receipt of any S02 proceeds. Id.
Additionally, the Commission ordered that a separate docket be opened for Staff to conduct
workshops and make a recommendation to the Commission regarding the appropriate
ratemaking treatment of S02 proceeds. Id.
This docket, IPC-05-, was opened and two workshops were held on November 7
and November 23 , 2005, respectively. During the workshops the parties were unable to reach
DECISION MEMORANDUM
agreement upon the ratemaking treatment of the proceeds. On March 6, 2006, the Commission
issued Order No. 29989 , establishing the following schedule: Comment deadline of March 31
2006; Company s Brief and Company s Reply Comments due on April 14, 2006; Staff and
Intervenor Briefs due on April 28, 2006; Company s Reply Brief due on May 12 2006.
The parties met on March 23 , 2006, and reached agreement upon an appropriate
ratemaking treatment for the allowance proceeds. The parties are currently working on a
stipulation that will be signed and submitted to the Commission.
STAFF RECOMMENDATION
Staff recommends that the Commission vacate the March 31 , 2006, comment
deadline, as well as the briefing schedule, that was previously ordered for this matter. Because
the agreement was just reached yesterday, the parties do not yet have a signed Stipulation to file
with the Commission but one should be forthcoming. Once the Stipulation is filed, Staff
recommends that the Commission issue a Notice of the Stipulation and open a comment period.
Staff anticipates filing comments in support of the Stipulation.
COMMISSION DECISION
Does the Commission wish to vacate the March 31 , 2006, comment deadline and the
subsequent briefing schedule for this matter?
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DECISION MEMORANDUM