20080721notice_of_application_order_no_30600.pdf

Office of the Secretary
Service Date
July 21 2008
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION CASE NO. IPC-08-
OF IDAHO POWER COMPANY FOR
AUTHORITY TO INCREASE ITS RATES NOTICE OF APPLICATION
AND CHARGES FOR ELECTRIC
SERVICE TO ITS CUSTOMERS IN THE NOTICE OF
STATE OF IDAHO INTERVENTION DEADLINE
ORDER NO. 30600
On June 27, 2008, Idaho Power Company ("Idaho Power" or "Company ) filed an
Application for authority to increase its rates an average of 9.89%. If approved the Company
revenues would increase by $66.6 million. The Company has requested that the proposed rate
increase become effective for electric service rendered on or after July 27 2008.
NOTICE OF APPLICATION
YOU ARE HEREBY NOTIFIED that Idaho Power s Application states that the
overall rate of return and return on equity heretofore allowed to the Company are no longer
reasonable and adequate and Idaho Power has and will continue to experience increased costs, all
of which now require immediate adjustment by way of increased revenues if Idaho Power is to
maintain a stable financial condition and continue to render reliable and adequate electric service
to its customers. Application at 7.
YOU ARE FURTHER NOTIFIED that Idaho Power requests that the Commission
grant it a return on rate base of 8.55% (11.25% return on common equity) on a $2 093 398 859
Idaho retail rate base. Id. at 5.
YOU ARE FURTHER NOTIFIED that Idaho Power s Application requests that 2008
be used as the relevant test year and that the test year data used in this filing is "based on actual
2007 data updated to 2008 levels.Id.
YOU ARE FURTHER NOTIFIED that this would result in an additional revenue
requirement of $66 588 286 for the Idaho jurisdiction, which requires an overall increase in
revenue of 9.89%. Id.
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 30600
YOU ARE FURTHER NOTIFIED that the Company proposes to increase rates to
each of its customer classes, based primarily upon cost of service. Idaho Power proposes to cap
the requested increase for irrigation customers and its three special contract customers (J.R.
Simplot Company, the Department of Energy (INL), and Micron Technology, Inc.) at 15%. Id.
at 3. The Company also proposes to increase the rates for its small commercial customers by
10.63%. Id. The Company s proposed increase for residential customers is 6.31% and 11.46%
for its large commercial customers. Id. The chart below shows an average charge by kilowatt-
hour (kWh) and the percentage increase for various customer groups.
Residential
Small Commercial
Lar e Commercial
Industrial
Irri ation
6.28~
96~
4.37~
3.31~
97~
67~
80~
88~
81~
71~
6.3%
10.
11.
15.
15.
YOU ARE FURTHER NOTIFIED that Idaho Power seeks an increase of the monthly
service charge by $1.00 for its residential customers and to "implement rates that increase based
on greater usage during the non-summer months.Id. The Company s proposal would "double
the number of kilowatt-hours qualifying for the lower-cost first block of energy and increase the
differential between the first and second block Energy Charges during the summer months
" for
Schedule 1 residential customers. Id.
YOU ARE FURTHER NOTIFIED that Idaho Power s Application states that in order
(t)o provide a stronger price signal to Schedule 1 residential customers during the summer
months of June, July, and August, Idaho Power proposes an Energy Charge of 6.1376~ per
kilowatt-hour for the first block and 7.3409~ for the second block." Id. During the non-summer
months
, "
Idaho Power proposes an Energy Charge of 5.8891~ per kilowatt-hour for the first
block and 6.1836~ per kilowatt-hour for the second block." Id. The chart below lists the
remaining customer classes and summarizes the types of increases each of them would receive
pursuant to Idaho Power s Application:
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 30600
Special
Small Large Contract
Commercial Commercial Industrial Irrigation (DOE,Schedule
Simplot,
Micron)
- Monthly service - Service Charge - Service Charge - Service Charge - Overall 15 %- Increase
charge - Basic Charge - Basic Charge - Demand increase In the from 2.727~
- # of kWh qualifying - Demand Charges - Seasonal and Charge component rates per kWh to
for lower-cost 151 - Seasonal Energy time-of-use - In-season and of each of its 976~ per
block of energy Charges Demand out-of-season three special kWh
- Rate differential - Mandatory time-Charges and Energy Charges contract
between I 5t block and of-use rates for Energy Charges - Introduce a customers
2nd block energy customers taking load-factor
charge during summer service at Primary based pricing
months and Transmission mechanism
service levels.
YOU ARE FURTHER NOTIFIED that the Application, supporting workpapers
testimonies, and exhibits have been filed with the Commission and are available for public
inspection during regular business hours at the Commission offices.The Application and
testimonies are also available on the Commission s Website at www.puc.idaho.gov under "File
Room" and then "Electric Cases.Interested persons may also view the Application at the
Company s web site www.idahopower.com. Idaho Power s schedule of rates and charges will
be kept open for public inspection.
YOU ARE FURTHER NOTIFIED that Idaho Power intrastate revenue
requirement, and every component of it, both rate base and expense, are at issue. The
Commission may grant, deny, or modify the revenue requirement requested and may find a
revenue requirement different from that proposed by any party to be just, fair, and reasonable.
IDAPA 31.01.01.124.01.
YOU ARE FURTHER NOTIFIED that the rates and charges of all Idaho retail
customers, both recurring and non-recurring, including those of any special contract customers
are at issue, and every component of every existing and proposed rate and charge is at issue. The
Commission may approve, reject, or modify the rates and charges proposed and may find that
rates and charges different from those proposed by any party are just, fair, and reasonable.
IDAP A 31.01.01.124.02.
YOU ARE FURTHER NOTIFIED that the Commission may approve, reject, or
modify existing or proposed relationships between and among rates and charges within, between
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 30600
or among customer classes or rate groupings and may approve, reject, or modify existing or
proposed relationships among and between customer classes or rate groupings. IDAP A
31.01.01.124.02.
YOU ARE FURTHER NOTIFIED that the Commission may abolish, reduce, or
create rate blocks or categories of rates and charges; abolish, create, or reduce components of
rates and charges; abolish, reduce, or create customer classes or rate groupings; and abolish
reduce, or create absolute or relative differences among and between existing classes or rate
groupings of customers. IDAPA 31.01.01.124.02.
DEADLINE FOR INTERVENTION
YOU ARE FURTHER NOTIFIED that persons desiring to intervene in this matter
for the purpose of presenting evidence or cross-examining witnesses at hearing must file a
Petition to Intervene with the Commission pursuant to this Commission s Rules of Procedure
72 and 73, IDAP A 31.01.01.072 and .073. Persons intending to participate at hearing must file a
Petition to Intervene on or before August 8, 2008. Persons seeking intervenor status shall also
provide the Commission Secretary with their electronic mail addresses to facilitate future
communications in this matter.
YOU ARE FURTHER NOTIFIED that persons desiring to present their views
without parties' rights of participation and cross-examination are not required to intervene and
may present their comments without prior notification to the Commission or the parties.
YOU ARE FURTHER NOTIFIED that on July 2, 2008, the Industrial Customers of
Idaho Power ("ICIP") filed a Petition to Intervene in this matter. No objections to ICIP'
intervention have been filed.
YOU ARE FURTHER NOTIFIED that on July 9, 2008, the Idaho Irrigation Pumpers
Association, Inc. ("lIP A") filed a Petition to Intervene in this matter. No objections to lIPA'
intervention have been filed.
YOU ARE FURTHER NOTIFIED that on July 15 2008, the Kroger Company dba
Fred Meyer and Smith's Food and Drug ("Kroger ) filed a Petition to Intervene in this matter.
No objections to Kroger s intervention have been filed.
YOU ARE FURTHER NOTIFIED that the Commission Secretary shall issue a
Notice of Parties after the deadline for intervention has passed. The Notice of Parties shall
assign exhibit numbers to each party in this proceeding. Depending on the number of
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 30600
intervenors, the Commission may direct that pleadings and testimony be filed electronically with
the other parties.
YOU ARE FURTHER NOTIFIED that after the Notice of Parties is issued the
Commission anticipates that the parties will informally convene to devise a recommended
schedule to process this case. Once a schedule is developed, the Commission will subsequently
issue a Notice of Hearing. The Commission intends to convene public hearings in this matter.
YOU ARE FURTHER NOTIFIED that the Commission has jurisdiction over this
matter pursuant to Title 61 of the Idaho Code, and specifically Idaho Code 99 61-302 61-307
61-502 61-503 61-507 61-622 and 61-623.
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be
conducted pursuant to the Commission s Rules of Procedure, 31.01.01.000 et seq.
SUSPENSION OF PROPOSED EFFECTIVE DATE
Due to the complexity of this case and other constraints on the Commission s time
the Commission finds that it cannot adequately review Idaho Power s requested rate increase
before the proposed effective date of July 27, 2008. Pursuant to Idaho Code 99 61-622, and 61-
623 the Commission hereby suspends the proposed rates for a period of thirty (30) days plus five
(5) months from July 27 2008, or until such time as the Commission enters an Order accepting,
rejecting, or modifying the request in this matter.
ORDER
IT IS HEREBY ORDERED that the proposed schedules of rates and charges
submitted by Idaho Power in this matter are suspended for a period of thirty (30) days plus five
(5) months from July 27 2008 , or until such time as the Commission enters an Order accepting,
rejecting, or modifying the request in this matter.
IT IS FURTHER ORDERED that the Petitions to Intervene submitted by the
Industrial Customers of Idaho Power; Idaho Irrigation Pumpers Association, Inc.; and the Kroger
Co. dba Fred Meyer and Smith's Food and Drug are granted.
IT IS FURTHER ORDERED that persons desiring to intervene in this case for the
purpose of presenting evidence or cross-examination at hearing shall file a Petition to Intervene
with the Commission no later than August 8, 2008.
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 30600
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this ;J..
j .
day of July 2008.
\A0
MACK A. REDFORD, PRESIDENT
MARSHA H. SMITH, COMMISSIONER
ATTEST:
~t0
Je . D. Jewell
Co mission Secretary
O:IPC-08-np_
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO. 30600