20090601Decision Memo.pdf

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DECISION MEMORANDUM
TO:COMMSSIONER KEMPTON
COMMISSIONER SMITH
COMMISSIONER REDFORD
COMMSSION SECRETARY
LEGAL
WORKNG FILE
FROM:BRYAN LANSPERY
TJGOLO
DATE:JU 1,2009
RE:APPROVAL OF ADVANCED METERING INFRASTRUCTURE TARIFF
CASE NO. IPC-E-09-07
On March 13,2009, Idaho Power Company (Idaho Power, Company) filed an
Application for authority to increase its rates due to the inclusion of Advanced Metering
Inastrctue (AMI) investment in base rates. On May 29,2009, the Commission issued Order
No. 30829 approving recovery of$IO,497,354 in additional revenue and requiring the Company
to .file tariff schedules designed to recover the amount.
On June 1,2009, the tariff schedules were filed with an effective date of June 1,2009.
The Staffhas reviewed the filed schedules and finds that they do not comply with Order No.
30829. Specifically, the Commission ordered "that the revenue deficiency be spread over the
affected classes. . ., leading to an average increase of 1.83 % for each of the affected classes."
(emphasis added) See Order No. 30829, page 5. The Company has applied a 2.08% unform
increase to the energy rate of each affected class. Since the fixed biling components are
unafected and energy consumption varies by class, the resulting overall increase in base
revenues equals the approved $10,497,354, or 1.83%, but varng percentage increases among
customer classes. For example, the Company's method produces a 1.60% increase in base
revenues for Schedule 24S (Secondar Irrgation) and a 1.96% base revenue increase for
Schedule 1 (Residential) customers. In all, the Company's proposed method of distributing the
rate increase produces a range of base revenue increases from a low of 1.60% (excluding
Schedule 41, Street Lighting) to a high of2.08%.
DECISION MEMORANDUM - 1 -JUE 1,2009
STAFF RECOMMENDATION
Staff believes that Idaho Power's proposed rates due to the inclusion of AMI investment
do not comport with the Commission directives of Order No. 30829, and therefore recommends
that the Commission deny approval of the revised tariff schedules as filed by the Company direct
the Company to resubmit taffs reflecting the intent of the Commission.
COMMISSION DECISION
Does the Commission approve the revised taff schedules as fied, or direct Idaho Power
to resubmit tarff schedules reflecting a 1.83% increase to each afected customer class?
udmemosldaho Power AM tariff June 1,2009
DECISION MEMORANDUM - 2-JUE 1,2009