20080327Customer Notice.pdf

i 1SIDA~POR(8
An IDACORP Company
LISA D. NORDSTROM
Attorney II
March 26, 2008
Jean D. Jewell, Secretary
Idaho Public Utilities Commission
472 West Washington Street
P. O. Box 83720
Boise, Idaho 83720-0074
Re: Case No. IPC-E-08-04
IN THE MATTER OF THE APPLICATION OF IDAHO POWER
COMPANY FOR AUTHORITY TO IMPLEMENT FIXED COST
ADJUSTMENT (FCA) RATES FOR ELECTRIC SERVICE FROM
JUNE 1,2008 THROUGH MAY 31, 2009
Dear Ms. Jewell:
Please find enclosed for filing an original and seven (7) copies of the
Company's bil insert referenced on page 6 of the Application filed March 14, 2008.
I would appreciate it if you would return a stamped copy of this transmittal
letter in the enclosed self-addressed, stamped envelope.
Very truly yours,
¿¡tØQ1t~~
Lisa D. Nordstrom
LDN:sh
Enclosures
P.O. Box 70 (83707)
1221 W. Idaho St.
Boise, 10 83702
l/--:~~'
LISA D. NORDSTROM, ISB No. 5733
BARTON L. KLINE, ISB No. 1526
Idaho Power Company
P.O. Box 70
Boise, Idaho 83707
Tel: [phone]
Fax: [phone]
Inordstrom(i idahopower.com
fiiAR 26 Ai, 2= 59
Attorneys for Idaho Power Company
Street Address for Express Mail:
1221 West Idaho Street
Boise, Idaho 83702
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MAnER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
AUTHORITY TO IMPLEMENT FIXED
COST ADJUSTMENT (FCA) RATES FOR
ELECTRIC SERVICE FROM JUNE 1, 2008
THROUGH MAY 31,2009
)
) CASE NO. IPC-E-08-04
)
) CUSTOMER NOTICE
)
)
)
As referenced on page 6 of the Application fied March 14, 2008, Idaho
Power Company hereby files the following bill insert that the Company will mail to
its customers from March 26, 2008 to April 24, 2008.
DATED this 26th day of March, 2008.
£QtJ~
LISA D. NORDSTRO .
Attorney for Idaho Power Company
CUSTOMER NOTICE, Page 1
-:IDA~PO.
An IDACORP Company
Information About
Your Electricity Bil
Offering programs and information to help our customers save energy and
money is part of providing safe, reliable and fair priced electricity. Building
power plants to ensure future energy needs are met is another. Meeting
these commitments requires periodic fiings with the Idaho Public Utilties
Commission (IPUC) to adjust the prices you pay for elecricity. Idaho Power
filed three request with the IPUC in March which may affec your rates.
Energy Effciency Programs
Energy effciency programs can help you save energy and dollars They
also help Idaho Power meet a growing need for elecricity by reducing the
amount of elecricity we buy or generate. Our energy efficiency programs
provide cash incentives, information and services to our residential,
commercial, industrial and irrigation customers. To expand these
programs we're seeking approval to adjust the amount colleced through
the existing Conservation Program Funding Charge from 1.5 percent of
your monthly energy bil, to 2.5 percent. All of the funds colleced by this
charge go directy to energy effciency. None is retained by Idaho Power.
The fiing was made March 14, 2008 and proposes to collect $16 milion
annually or an increase of $7 million over the current annual amount. To
learn more about these programs or to enroll visit ww.idahopower.com/
energycenter.
Fixed Cost Adjustment
The purpoe of the Fixed Cost Adjustment (FCA) is to encourage utilities
to invest in energy efficiency programs and activities. Your elecricity rates
include a variable cost component that contains the cost of elecricity, and
a fixed cost component tied to the cost of power lines and infrastructure
required to deliver elecricity.
Normally utilties recover these two cost components through electricity
sales. When recovery of fixed costs is tied to the sale of electricity, utilties
have a disincentive to encourage reduced energy usage since it results in
the loss of the fixed cost recovery.
The FCA is a three-year pilot program approved last year by the IPUC.
It authorizes Idaho Power to separate the recovery of the fixed costs of
providing elecrical service to its residential and commercial customers
from the actual sale of electricity to these customer groups. It is intended
to make the company financially neutral when it invests in energy
efficiency programs for residential and small business customers.
-~._-~...////
The FCA provides for an IPUC-determined amount of fixed costs to be
recovered from residential and small commercial customers. If, because
of reduced electricity use during the year, the company under-eollect
the authorized fixed cost amount, it can collect the difference through
a surcharge. If Idaho Power over-collect the authorized amount, the
company refunds the difference through a credit.
During 2007, the company over-collected fixed costs from residential
customers and under-colleced fixed costs from its commercial customers.
Therefore, residential customers are proposed to receive a 1.17 percent
credit beginning June 1. Due to under-eollection, small commercial
customers are proposed to receive a 3.0 percent surcharge beginning
June 1.
New Power Plant
Having adequate resources today and tomorrow is another part of our
commitment. On March 7, Idaho Power filed an application with the IPUC
for approval to place the construction costs for a 170 megawatt natural
gas-fired power plant into base rates. Part of the Evander Andrews Power
Complex near Mountain Home, Idaho, this plant helps meet energy needs
during peak times such as long, hot summer afternoons when energy
supplies are low and cost for power are high. If approved, this action will
increase all customers' rates uniformly by an average of 1.4 percent and
would produce an estimated $9 millon in additional revenue per year.
Overall Impact of These Actions
If approved, these requests collecively wil have differing impact on the
rates paid by our customers. The chart below shows the average change:
Customer Group Overall Perrent ChangeI;".
5mallCommercii 5.3%
U;;.i"¡..i;,,e!l
Irrigation 2.7%
'l#li
:: 3% _
24% .
~ - ,2.:% -
For an average residential customer using 1,050 kilowatt-hours of
elecricity each month, the monthly bil would increase by $1.01
per month during June, July and August and by 78 cents during
non-summer months.
Idaho Power's applications are proposals open to public review and
comment and subjec to IPUC approval. They are available on the
companls "Regulatory Information" Web page at ww.idahopower.com/
aboutus. Copies also are available at Idaho Power offices or at the Idaho
Public Utilities Commission offce in Boise.
Our intention is to keep our customers informed about changes that
, affec them. We encourage you to learn about energy efficiency and
to parter with us to use our resources wisely.