20090701final_order_no_30853.pdf

Offce of the Secretar
Service Date
July 1,2009
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF IDAHO POWER COMPANY FOR ) CASE NO. IPC-E-08-22
AUTHORITY TO MODIFY ITS RULE H )
LINE EXTENSION TARIFF RELATED TO )
NEW SERVICE ATTACHMENTS AND ) ORDER NO. 30853
DISTRIBUTION LINE INSTALLATIONS. )
On October 30, 2008, Idaho Power Company filed an Application seeking authority
to modify its Rule H taff relating to charges for installing or altering distribution lines.
Specifically, the Company sought to increase the charges for new service attachments,
distrbution line installations and alterations. After reviewing the record in ths case, we approve
Idaho Power's Application as modified below. We approve the Company's proposed
allowances, miscellaneous costs, language regarding highway relocations, and the requested
changes to format and definitions. We furher approve a "cap" of 1.5% on general overhead
costs and maintain the existing five-year period for Vested Interest Refuds. These changes to
Ru1e H shall become effective on November 1,2009.
I. THE APPLICATION
Idaho Power proposes modification to its existing Rule H tariff that reorganizes
sections, adds or revises definitions, updates charges and allowances, modifies refud provisions,
and deletes the Line Installation Agreements section. Section titles were aranged to more
closely reflect the maner in which customers are charged and to better match the arangement
of the Company's cost estimation process. Definitions have been added or revised to provide
clarity.
Idaho Power proposes separate sections for "Line Installation Charges" and "Service
Attchment Charges." Withn the Service Attachment Charges section, Idaho Power separates
the overhead and underground service attachments, updates the charges for underground service
attachments less than 400 amps, and outlnes the calculation for determining the charges for
underground service greater than 400 amps. The "Vested Interest Charges" section was
reworded and some definitions were removed. The available options and calculations in ths
section were not changed. Engineering charges, temporary service attachment charges, and
retur trip charges were updated in the "Other" Charges section.
ORDER NO. 30853 1
The Company asserts that the Line Installation and Service Attachment Allowances
section was modified and updated to reflect current costs associated with providing and installng
"standard terminal facilties" for single-phase and three-phase service and line installations. The
Company's proposal to provide customer allowances equal to the installed costs of "standard"
overhead terminal facilities is intended to provide a fixed credit toward the cost of constructing
terminal facilties and/or line installations for customers requesting service under Rule H. The
fixed allowance is based upon the cost of the most commonly installed facilities and attempts to
mitigate intra-class and cross-class subsidies by requiring customers with greater facilties
requirements to pay a larger portion of the cost to serve them. The proposal also modifies
Company-funded credit allowances inside subdivisions. Idaho Power maintains that these
significant revisions to the tariff specifically address the Company's and Commission's desire
for customers to pay their fair share of the cost for providing new service lines or altering
existing distribution lines.
Idaho Power proposes Vested Interest Refunds for developers of subdivisions and
new applicants inside subdivisions for additional line installations that were not par of the initial
line installation. i The Company also proposes to change the availabilty of Vested Interest
Refuds from a five-year period to a four-year recovery period and discontinue all subdivision
lot refuds.
Idaho Power also seeks authority to add a section entitled "Relocations in Public
Road Rights-of-Way" to address fuding of roadway relocations required under Idaho Code §
62-705. The section would identify when and to what extent the Company would fund roadway
relocations. Specifically, this section would outline road improvements for the general public
benefit, road improvements for third-party beneficiaries, and road improvements for a joint
benefit.
The Company asserts that it has underten a special communications effort to
advise builders and developers in its service territory of the proposed changes. Idaho Power
requests that the Commission's Order set an effective date 120 days beyond the date of the final
Order to allow the Company time to train employees, reprogram computerized accounting
systems, and reconstruct internal processes.
i Subdividers and new applicants wil continue to be eligible for Vested Interest Refuds outside of subdivisions.
ORDER NO. 30853 2
II. PROCEDURAL HISTORY
On November 26, 2008, the Commission issued a Notice of Application and
Intervention Deadline. Order No. 30687. Four paries petitioned to intervene. The Building
Contractors Association of Southwestern Idaho (BCA), the City of Nampa, The Kroger
Company, and Association of Canyon County Highway Districts (ACCHD) were granted
intervention. The Commission issued its Notice of Paries on December 30, 2008. Pursuant to
Order No. 30687, the parties met on January 14,2009, to discuss the processing of this case.2
The paricipating parties recommended that the case be processed under Modified
Procedure with comments due no later than March 20, 2009.3 The comment deadline was
subsequently extended until April 17, 2009, with response comments due no later than May 1,
2009.
THE COMMENTS
Written comments were fied by Commission Staff and all intervenors with the
exception of Kroger. In addition, more than 40 public comments were received, including
comments fied by the Ada County Highway District and the Idaho Irrigation Pumpers
Association. A great number of the public comments were submitted by contractors, many of
whom submitted identical form letters stating their concern regarding: (1) the timing of Idaho
Power's Application and the processing of the case; (2) the undue hardship that will be created
on the construction industry; and (3) their opposition to any increase in fees that would
ultimately be passed on to home buyers. Idaho Power and the Building Contractors Association
filed reply comments.
1. Ada County Highway District. Although not an intervenor in this case, Ada
County Highway District (Highway District) fied comments asserting that Idaho Power's
proposed Section lOis beyond the jurisdictional authority of the Commission, is potentially
unconstitutional, and includes an overly broad definition of "third party beneficiar." The
Highway District argues that Section 10 is "an ilegal usuration of the highway districts'
2 Although notified of the meeting, no representatives for Kroger or the Building Contractors Association were in
attendance.
3 On February 27, 2009, BCA fied a motion to extend the comment period based on the complexity and natue of
the issues involved. The Commission granted BCA's request on March 11,2009. The suspension of the proposed
changes to Rule H was extended until July i, 2009, commensurate with the comment extension deadlines. Order
No. 30746.
ORDER NO. 30853 3
exclusive general supervision and jurisdiction over all highways and public rights-of-way
because it purports to regulate and control electric utilty relocations by assigning financial
liabilty for such relocations." Highway District Comments at 1 (emphasis in original). The
Highway District requests that the Commission strike anything in Idaho Power's proposed Rule
H tariff that attempts to regulate in any maner the relocation of utilties in the public rights-of-
way.
2. Idaho Irrigation Pumpers Association. Idaho Irrigation Pumpers Association, Inc.
(IIPA) fied comments which generally supported Idaho Power's Application. However, IIPA
maintains that Idao Power's "standard terminal facilty" concept does little to spread the cost of
growth to those causing such costs because it fails to ensure that the most expensive customers
pay additional costs for their new service. IIPA Comments at 2-3. IIPA asserts that larger
customers should not be penalized for simply being larger, especially considering economies of
scale that allow Idaho Power to serve its larger customers at less cost than its smaller customers.
In addition, IIP A points out that the proposed Rule H changes do not address the incremental
costs of growth as it applies to associated transmission and generation costs.
3. Commission Staff. Staff agrees in principle with Idaho Power's rationale that
growth should pay for itself and that new customer growth, combined with the effects of
inflation, does indeed cause upward pressure on rates. However, Staff expressed concern that
Idaho Power had not provided any analysis to determine specifically what amounts of
allowances and refuds would alleviate upward pressure on rates. Staff supported line extension
rules that provide a new customer installation credit or allowance that can be supported by
electric rates paid by the new customer over time.
If the line extension costs exceed that allowance, then the new customer
would pay an up-front contribution for the difference rather than including the
excess costs in electric rates paid by all customers. In order to properly
establish an allowance, a refund and the potential for additional customer
contribution, a detailed analysis of distribution investment embedded in
existing electric rates must be conducted.
Staff Comments at 3_4.4
4 Staffs proposed allowances are based on the cost to provide customers with overhead service. Staff recommended
that underground service for residential and small commercial customers be provided at no additional charge if the
customer supplies the trench, conduit, backfill and compaction. Otherwise, Staff recommended that customers
requesting underground service be required to pay the difference between the costs of providing underground
service versus overhead service.
ORDER NO. 30853 4
Staff next reviewed the cost allocation formula for curent rates. Staff believes Rule
H overhead costs are embedded in current electric rates to the extent they exceed the 1.5%
limitation. Staff asserts that including the entire overhead rate in Rule H work orders would
result in Idaho Power collecting the difference of 13.5 percent in both work orders and in curent
electricity rates. Staff maintains that this is a timing problem that can be resolved in the next
general rate case. The case would set rates based on costs which do not include that portion of
construction overhead belonging to Rule H work orders. The overhead rate for Rule H could
include the 15%, effective on the same day as the new rates. This would shift costs from general
rates to those requesting Rule H line extensions.
Staff does not support reducing the time period for receiving Vested Interest Refuds
from five years to four years. Idaho Power reasoned that not enough refund requests are made in
the fifth year to justify the administrative burden. Staff argues that more refunds wil be made in
the fifth year now that building activity has slowed and subdivisions are slower to fill. Staff does
not object to Idaho Power's proposal that developers be eligible for Vested Interest Refuds
inside subdivisions for additional line installations that were not par of the initial line
installation.
Staff recommended that transformer costs inside subdivisions be refuded to the
subdivider/developer as new homes connect for permanent service. Staff stated that making
transformer costs subject to refund as individual lots are developed ensures that all residential
customers receive equal allowances, but relieves the Company of the risk of bearing the cost of
transformers should lots not be developed.
Staff agrees with Idaho Power's efforts to clarify existing Rule H language by
addressing third pary requests that affect utilty facilties in public rights-of-way. Staff opined
that cost shifting from developers to Idaho Power customers should be prevented whenever
possible.
Idaho Power proposes to update several charges in Rule H including engineering
charges, underground service attachment charges, overhead and underground temporar service
attchment charges, and overhead and underground temporar service retur trip charges. Staff
reviewed the proposed updated charges and believes they are reasonable based on changes in
labor rates, different installation procedures and changes in calculation methodology.
ORDER NO. 30853 5
Finally, Staff supports Idaho Power's proposed definition, general provision and
formatting changes. Staff, however, recommended the following revision to the Company's
definition of "unusual conditions" in order to clarfy the Company's curent policy:
Unusual Conditions are construction conditions not normally encountered, but
which the Company may encounter during construction which impose
additional, project-specifc costs. These conditions may include, but are not
limited to: frost, landscape replacement, road compaction, pavement
replacement, chip-sealing, rock digging/trenching, boring, non-standard
facilties or construction practices, and other than available voltage
requirements. Costs associated with unusual conditions are separately stated
and are subject to refund.
Staff Comments at 13-14. Staff fuher recommended that Idaho Power include a provision in its
Unusual Conditions Charge, Subsection 6.h, declaring that, should anticipated unusual
conditions not be encountered, the Company wil issue the appropriate refund within 30 days of
completion of the project.
4. City of Nampa and Association of Canyon County Highway Districts. The City
of Nampa (Nampa, "intervenors" collectively) and Association of Canyon County Highway
Districts (ACCHD, "intervenors" collectively) asserted the same concerns regarding Idaho
Power's Application. Nampa and ACCHD argue that the Commission lacks jurisdiction to
authorize Idaho Power's proposed Section 10 of its Rule H Tariff. The intervenors contend that
municipalities have exclusive authority to determine whether relocation of utilty facilties is
necessary.
The intervenors maintain that Idaho Power's proposed Section 10 language places
the Commission in the position of determining whether a project requiring utilty relocation
conveys a general public benefit, a third pary benefit, or a shared benefit. In addition, Nampa
and ACCHD argue that the definition of "third par beneficiar" is problematic and potentially
overly broad. The intervenors suggest that the proposed definition be amended by deleting any
reference to public entities or political subdivisions. Nampa and ACCHD furter assert that
including local improvement districts within the definition of third pary beneficiar contravenes
the exclusive authority of the municipality to require relocation of utilties to avoid incommoding
the public use.
ORDER NO. 30853 6
Nampa and ACCHD ultimately request that the Commission delete the entirety of
Section 10 and any other pars of the proposed Rule H that attempt to regulate the relocation of
utilties on municipal land.
5. Building Contractors Association. The Building Contractors Association (BCA)
asserts that Idaho Power's approach in this Application is inconsistent with existing Commission
policy established by Idaho Power's last Rule H taiff revision in 1995. According to BCA, the
Commission at that time held that new customers were entitled to have the Company provide a
level of investment equal to that made to serve existing customers in the same class, and that it
was appropriate that some portion of the cost of new distribution be recovered through rates.
BCA also argues that Idaho Power's curent position is inconsistent with the Commission's
policy that rates should send a stronger price signal to customers encouraging the effcient use of
energy. Case No. IPC-E-08-1O.
BCA alleges that inflation, not growth, is the actual source of increased costs to
extend new distribution plant. BCA fuher asserts that Idaho Power's proposal would shield its
existing customers from paying for the actual value of the service that they receive. According
to BCA, the requested modifications are likely to stimulate/increase electricity demand because
of the incorrect market signal that a subsidy would send.
BCA maintains that to shift the cost of providing service from Idaho Power and/or
one class of customers to another wil have adverse and unintended consequences to all
homeowners that could exceed whatever arguable benefit they might receive from paying
electric rates set below the cost of service. BCA urges the Commission to deny Idaho Power's
Application, increase the terminal facilties allowances under its curent taiff, provide for
periodic tre-ups of these allowances, and increase the vested interest period from five years to
ten years.
6. Idaho Power's Response. Idaho Power insists that, by providing allowances equal
to the "stadard" and most common services installed, the Company can help ensure that the
additional costs . associated with larger "non-standard" services are recovered from those
customers requesting the services rather than spreading those additional costs to all ratepayers.
The Company emphasizes that the quantification of standard terminal facilities costs would be
updated anually.
ORDER NO. 30853 7
Idaho Power expressed concern that Staff s recommendation for allowances might
cause allowances to be inflated by lack of equipment sizing equivalents. Also, the Company
pointed out that Staff did not address allowances for Schedule 1, Non-Residential and Multiple
Occupancy. The Company opposes what it interprets as a recommendation by BCA that all
terminal facilties (overhead and underground) be provided and included in rate base.
Idaho Power disagrees with Staffs assertion that adjusting general overheads in the
Company's current Application would amount to double counting. Idaho Power explains that
because overhead costs do not become additions to electric plant in service until the work order
they have been applied to is completed, any futue overhead costs would not be included in
electric plant in service, and therefore in rates, until the next general rate case.
Although Idaho Power's initial Application requested reducing the vested interest
period from five years to four years, the Company does not oppose Staff s recommendation to
retain a five-year vested interest period. The Company does, however, oppose BCA's
recommendation to extend the vested interest period to ten years.
Idaho Power stands by its proposal to discontinue subdivision lot refunds in an effort
to shift a greater portion of the cost for facilties installed inside subdivisions from the general
rate base to those customers requesting new facilties. However, the Company is not opposed to
Staffs recommendation that transformer costs inside subdivisions be refuded to the
subdivider/developer as new homes connect for permanent service.
Idaho Power points out that BCA' s method for developing its lot refund
recommendation is flawed because the calculation erroneously includes the cost of distribution
substations, terminal facilties and meters. Idaho Power also disputes BCA's assertion that
updated Rule H charges and credits wil have a direct impact on housing prices. The Company
argues that the market sets housing prices - not home builders, suppliers, utilties or developers -
and that builders and developers have the opportity to adjust their construction practices to
meet curent demand.
Idaho Power states that its Rule H and predecessor rules have, for at least 30 years,
required that paries who request the relocation of Company utilty facilities be obligated to pay
for the costs of the relocations. Idaho Power asserts that Ada County Highway District and
intervenors City of Nampa and ACCHD misunderstand: (1) what the Company is requesting; (2)
the scope of the Commission's authority to regulate utilty rates and operations; and (3) how the
ORDER NO. 30853 8
Commission's jurisdiction encompasses the allocation of costs arsing out of relocation of utilty
facilties, including relocation in public road rights-of-way.
Idaho Power agrees that the aforementioned agencies have sole and complete
jursdiction to determine when relocation is required to avoid incommoding the public.
However, Idaho Power contends that, in regard to allocating the costs of utilty facilty
relocations to determine utilty rates and charges, the Commission has exclusive jursdiction.
Idaho Power asserts that its proposed Section 10 of Rule H allows the Commission to exercise its
jursdiction concurently with the other agencies in a way that does not contravene the important
roles that the agencies play in constrcting, operating, and maintaining the streets and highways
withn their jurisdictions. The Company agrees to clarify the definition of "local improvement
district" within Section 10 of its proposed Rule H changes.
Finally, Idaho Power does not nppose Staffs recommendation to modify the
definition of "unusual conditions," but suggests that the final sentence read, "Costs associated
with unusual conditions are separately stated and are subject to refud if not encountered." The
! Company fuer proposed that if unusua conditions are not encountered, the Company issue the
appropriate refud within 90 days of complet!on of the project due to contract constraints with
sÌìbcontractors that would make a 30-day refnnd unworkable.
7. BCA's Response. BCA fied response comments disputing Staffs analysis and
recommendations regarding its position on investment in distribution facilities. BCA maintains
'.
that Stas analysis"essentially concurs with BCA's position that the increased costs of
distribution facilties areàttbutable to inflation, yet Staff supports a line extension tariff that
disproportionately allocates the additional cost of facilities to new customers simply because
they are new customers. BCA ~es that Staff s position is inherently discriminatory and
inconsistent with longstading CommIssion policy.
"
DISCUSSION AND FINDINGS
Idaho Power is a public utilty pursuant to Idaho Code §§ 61-119 and 61-129. The
Commission has jursdiction over this matter pursuant to Title 61 of the Idaho Code. Idaho
Power last filed for major changes to its Rule H tarff in 1995. The Commission appreciates the
considerable efforts expended by the intervenors and commenters to this case.
1. Allowances. The capital cost of installng new generation and transmission plant
has always generally been recovered through rates paid by all customers. Indeed, fees cannot be
ORDER NO. 30853 9
charged for new plant that canot be attibuted specifically to serving new customers.5 However,
in the case of distrbution plant it is possible to associate specific facilties with specific
customers who use them. As a result, the costs of new distribution plant have, throughout most
of Idaho Power's history, been recovered in two ways - parially through up-front capital
contrbutions from new customers, and parially through electrc rates charged to all customers.
The portion collected though electric rates represents the investment in new facilties made by
Idaho Power. It is often referred to as an installation or constrction "allowance."
Idaho Power, Staff and the BCA hold differing views as to what is causing the
upward pressure on rates and whether the increasing costs should be borne by all customers
though a rate increase or by new customers through higher line extension charges. The
Commission recognizes that multiple forces put upward pressure on utilty rates. In this case, we
are addressing one of them.
The Commission finds that Idaho Power's proposed fixed allowances of $1,780 for
single-phase service and $3,803 for three-phase service represent a fair, just and reasonable
allocation of line extension costs. These allowances are larger than existing allowances.
Therefore, the Commission approves allowances for overhead and underground line installations
and overhead service attachments as follows:
Class of Service Maximum Allowance per Service
Residential:
Schedules 1, 4, 5
Non-residence
$1,780
Cost of new meter only
Non-residential:
Schedules 7, 9, 24
Single-Phase
Three-Phase
$1,780
$3,803
Large Power Service
Schedule 19 Case-by-case
Developers of subdivisions and multiple occupancy projects wil receive a $1,780 allowance for
each single-phase transformer installed within a development and a $3,803 allowance for each
thee-phase transformer installed within a development.
5 Idaho State Homebuilders v. Washington Water Power, 107 Idaho 415,690 P.2d 350 (1984); Building Contractors
Association v. ¡PUC and Boise Water Corp., 128 Idaho 534, 916 P.2d 1259 (1996).
ORDER NO. 30853 10
By updating line installation charges and increasing the allowances, the appropriate
amount of contribution will be provided by new customers requesting these services. These
changes relieve one area of upward pressure on rates. Moreover, the Company's proposal is
imparial to customer class, minimizes subsidization of terminal facilities costs, and caries the
added benefit of administrative simplicity. Idaho Power shall make an annual filing, no later
than Januar 1 of each year, updating allowance amounts for single- and three-phase service to
reflect curent costs for "standard" terminal facilties.
2. General Overheads. The Commission finds that customers requesting Rule H line
extensions should bear the overhead costs of those extensions. However, we find that the
appropriate calculations and adjustments are best made during the Company's next general rate
case to ensure that rates are set based on costs that do not include that portion of constrction
overhead belonging to Rule H work orders. Until then, we find that continuing the general
overhead rate of 1.5% is fair, just and reasonable.
3. Vested Interest Refund Period. Idaho Power proposes to reduce the time
limitation to receive Vested Interest Refuds from five to four years to reduce the administrative
Iburden that accompanies such refuds. The Company noted that less than 2% of customers
ieligible for Vested Interest Refuds receive them in the fift year.
If few refuds are actually requ~sted in the fifth year, then the administrative burden
!
should not be that great. In addition, as atated by Staff in its comments, it is reasonable to
assume that more refuds may be made in ~he fifth year now that building activity has slowed
from the rapid pace of the past several years and subdivisions are slower to fiL. BCA's request
!
to extend the refud period to ten ye'ars is niot supported by documentation or cogent arguent.
Therefore, the Commission finds that maihtaining a five-year time frame for Vested Interesti,
Refuds is fair, just and reasonable. In ad~ition, and as requested by Idaho Power, we find it
reasonable to include subdividers as eligiale for Vested Interest Refuds for additional line
instalations inside subdivisions that were not par of the initial line installation.
4. Lot Refuds. Idaho Power! seeks to discontinue subdivision lot refuds in an
¡effort to reduce the growt of rate base that ¡results from the refuds. Based on its calculations,
¡BCA argues that lot refunds should be increaSed from $800 to $1,000 per lot.
Under the Rule H approved in 1995, lot refunds reimbursed a portion of the line
extension costs that developers were required to advance to Idaho Power prior to constrction.
ORDER NO. 30853 11
The refuds were given as customers began taing permanent service. Developer line extension
costs inside subdivisions do not include costs of distribution substations, drop wires or meters.
The BCA proposal to increase lot refuds to $1,000 rests on incorrect calculations
that include costs that are not par of developer line extension costs. Therefore, the Commission
rejects that proposaL. The Commission finds that the overall distribution allowance provided to
developers, whether in the form of a subsequent refud or an upfront reduction in developer
contrbution (i.e., allowance), is properly based on the amount of distribution investment that can
be supported by new customer rates. The Company has reasonably calculated that amount in its
upfront, per lot distribution allowance. Any additional distribution cost refud to the developer
would exceed the distrbution investment that new customer rates could support. Therefore, the
Commission finds it fair, just and reasonable to accept the Company's per lot distrbution
allowance and eliminate lot refuds.
BCA further argues that eliminating the lot refund wil have a direct impact on
housing prices, thereby pricing potential homeowners out of the market. The Commission is
aware that ths change in Rule H may impact the cost of a home. However, given the number of
costs for building a new home and the relative size of this potential impact, we canot draw any
conclusions as to the significance of any impact on the ultimate price.
5. Section 10 - Highway Relocations. Generally, paries requesting the relocation of
utilty facilties are obligated to pay for the costs of the relocation. However, the State and its
political subdivisions can require the relocation of utilty facilities located within the public
right-of-way pursuant to their police power. Utilties may use public rights-of-way so long as
their facilties do not incommode the public use of such roads, highways, and streets. Idaho
Code § 62-701; State v. Idaho Power Co., 81 Idaho 487, 346 P.2d 596 (1959).
Ada County Highway District, the City of Nampa, and the ACCHD argue that Idaho
Power's proposed Section 10 of its Rule H revisions is an improper usurpation of the
aforementioned agencies' authority and beyond the jurisdiction of this Commission. We find
that Section 10 does not explicitly or implicitly usur the public road agencies' authority to
manage and control their rights-of-way.
Section 10 does not impede a public road agency's right to require Idaho Power to
relocate facilties in the public right-of-way, at no cost to the public road agency, where the
facilties incommode the public use. Section 10 simply creates a mechanism for determining
ORDER NO. 30853 12
who is responsible for the costs of the relocation. Contrar to the arguments of the
aforementioned agencies, the Idaho Constitution and existing case law are not violated because
Section lOin no way grants Idaho Power or this Commission authority to impose such costs on a
public road agency. Section 10 addresses whether Idaho Power customers or a third par should
pay for the relocation of utilty facilities.6 Just as the Commission canot compel the highway
agency to pay for the relocation of utilty facilties in the public right-of-way made at the
agency's request, the agency canot restrict the Commission from establishing reasonable
charges for utilty services and practices. Idaho Code §§ 61-502 and -503.
Idaho. Power proposed Section 10 of its Rule H tariff to address the situation tht
arses when highway improvements and the concurent requirement to relocate utilty facilities is
caused by development adjacent to streets and highways. We find that the Section 10 provisions
wil properly allocate the utilty costs of relocation so that Idaho Power customers pay only the
appropriate amount of the cost. We fuher find it persuasive that when a public road agency
obtans contributions from a third party toward the cost of a highway improvement project it is a
reasonable and appropriate indication of cost responsibility for ratemaking purposes. Moreover,
utilzing. the public road agency's formula for the allocation of costs maintains consistency
between agencies.
Therefore, we find the creation and inclusion of Section 10 to be fair, just and
reasonable. As agreed to in its reply comments, we direct Idaho Power to clarify its use of the
phre "local improvement district" as it is used in Section 10.
6. Miscellaneous Costs. We find the proposed updates to Idaho Power's
miscellaneous costs such as engineering charges; underground service attachment charges;
overhead and underground temporary service attachment charges; and underground temporar
service retur trp charges are fair, just and reasonable. These updates are based on changes in
labor rates, different installation procedures, and changes in calculation methodology.
7. Formatting and Definitions. We find Idaho Power's proposed changes to its
definitions, general provisions and formatting of Rule H to be reasonable. We direct Idaho
Power to modify its proposed definition of "unusual conditions" to include not only the
recommendation of Staff but also the clarfication of "if not encountered" provided by the
6 We understad that some highway projects include fuding to defray the costs of relocating utilty facilities.
ORDER NO. 30853 13
Company in its reply comments. We fuher direct the Company to include language addressing
a 90-day refud period if unusual conditions are not encountered.
ORDER
IT is HEREBY ORDERED that Idaho Power's Application for authority to modify
its Ru1e H taff related to new service attachments and distrbution line installations and
alterations is approved with modifications as enumerated above.
IT is FURTHER ORDERED that Idaho Power shall fie revised tariffs consistent
with the Order.
IT is FURTHER ORDERED that Idaho Power shall submit to the Commission, no
later than Janua 1 of each year, updated allowance amounts for single- and three-phase service
to reflect curent costs for "standard" terminal facilities.
IT is FURTHER ORDERED that the charges and credits authorized by this Order
shall become effective for services rendered on or after November 1, 2009.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days of the service date of ths Order. Within seven (7)
days afer any person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See Idaho Code § 61-626.
DONE by Order of the Idaho Public Utilties Commission at Boise, Idaho this / s:
day of July 2009.
aÆ.~;~JIM . KEMPON, M0 ENT~d~MARSHA H. SMITH, COMMISSIONER
~~NER
ATTEST:
€ØÐfrJ D. Jewell
C ission Secretar
O:IPC-E-08-22_ks4
ORDER NO. 30853 14