20100129final_order_no_30993.pdf

Office ofthe Secretary
Service Date
January 29 2010
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
AUTHORITY TO SELL TO RAFT RIVER
RURAL ELECTRIC COOPERATIVE, INC.
CERTAIN ELECTRIC DISTRIBUTION
FACILITIES CURRENTL OWNED BY
IDAHO POWER
ORDER NO. 30993
CASE NO. IPC-09-
On November 10 2009, Idaho Power Company ("Idaho Power" or "Company ) filed
an Application with the Commission for authority, pursuant to Idaho Code 9 61-328 and RP 52
to sell Raft River Electric Cooperative, Inc. ("Raft River ) certain electric distribution facilities
and appurtenant rights-of-way owned by Idaho Power in southern Twin Falls County, Idaho.
On December 16, 2009, the Commission issued a Notice of Application, Notice of
Modified Procedure and Notice of Public Hearing. See Order No. 30963. The Notice established
a 21-day comment period and announced that a public hearing would be held on January 12
2010 in the Commission s Hearing Room. Subsequently, the public hearing was held and
Commission Staff was the only party to submit written comments regarding the Company
Application.
THE APPLICATION
Idaho Power s Application states that "Raft River is a non-profit cooperative
electrical corporation, incorporated under the laws of the state of Idaho, providing retail electric
service to its members in the states ofldaho, Utah, and Nevada.Application at 2. Raft River is
headquartered in Malta, Cassia County, Idaho and is not subject to regulation by the
Commission. Id.
In the proposed transaction, Idaho Power has agreed to sell Raft River the remaining
portion of the Border 011 Feeder Line ("Feeder Line ), approximately 1.5 miles, located in the
State of Idaho. Id. In its Application, Idaho Power cites the approval of its joint application in
Case No. IPC-00-, wherein Raft River acquired the portion of the Feeder Line located in the
State of Nevada as part of the transaction pertaining to the sale of "certain Idaho Power electrical
distribution facilities in southern Owyhee County, Idaho.Id.; see also Order No. 28631. The
Feeder Line is "used solely to serve Raft River and is classified as a dedicated distribution
ORDER NO. 30993
primary facility.Id. The wholesale transportation of energy across the Feeder Line to Raft
River s facilities is subject to FERC jurisdiction. Id.
Idaho Power s method of valuation for the Feeder Line, including appurtenant right-
of-way permits
, "
will be . . . the net book cost as valued on Idaho Power s books and records
immediately prior to the closing date adjusted for income tax impacts.Id. Idaho Power
estimates that the sale price will be approximately $72 000., including a tax gross-up.Id.
Idaho Power does not use the Feeder Line to serve any retail customers. Id.
On December 21 , 2009, Idaho Power submitted a Motion to Amend its original
Application and modify the sale price of the facilities from $72 000 to approximately $44 000.
See Motion to Amend at 2. In the Company s estimation, it would be "unnecessary for the
Company to require a tax gross up to fairly price the facilities to be sold.Id.
STAFF COMMENTS
Staff conducted an audit and investigation of Idaho Power s Application. Staff
Comments at 3. Staff reviewed the Company s documentation regarding the valuation of the
property to be sold to Raft River and "found the valuation to be reasonable.Id. Staff believes
that, similar to the Commission s ultimate finding in Case No. IPC-00-
, "
the current
proposed sale of the Border 0 11 Feeder Line is also in the public interest as it better assigns the
responsibility to maintain the line to Raft River and its customers served by the line.Id. Staff
emphasized that Idaho Power does not have any retail customers served by the Feeder Line and
the "dollar amount is immaterial to Idaho Power s operations and will have very little impact on
Idaho Power customers.Id. Moreover, Raft River has the requisite intent and financial
wherewithal to successfully "operate the property in the public service.Id.
Staff recommended that the Commission approve Idaho Power s Amended
Application to sell the Border 011 Feeder Line to Raft River. Id. at 4. Further, Staff
recommended that the Company file the following documents with the Commission: (1) the
anticipated accounting entries related to the transaction, no later than seven days prior to the
closing date of the transaction; (2) closing documents and related accounting entries, no later
than seven days after the closing date of the transaction; and (3) the pole attachment agreement
between Idaho Power and Raft River, no later than seven days after the closing date of the
transaction. Id.
ORDER NO. 30993
PUBLI C HEARIN G
On January 12, 2010, a public hearing was held pursuant to the requirements found in
Idaho Code ~ 61-328. A court reporter was present at the hearing and prepared an official record
of the proceeding.
Representatives of Idaho Power, Raft River and Commission Staff were present
during the hearing. Chairman Kempton offered a brief summary of the Company s Application
and then provided the parties, as well as members of the audience, an opportunity to offer
comments pertaining to the Application. No comments were offered by the parties or the public
at large.
COMMISSION DECISION AND FINDINGS
The Commission has reviewed and considered the filings in Case No. IPC-09-
including Idaho Power s Application and Staffs comments. We find the terms and conditions of
the parties' Agreement enabling the sale of the electric distribution facilities to be just
reasonable and in the public interest. The Commission also finds that the sale of the facilities to
Raft River will not have a detrimental impact on the Company s rates or quality of service
because the facilities at issue in this case are not being utilized to serve any retail customers of
Idaho Power. Finally, the Commission finds that Raft River is a qualified electric service
provider with the technical capability and financial wherewithal to operate and maintain the
aforementioned facilities for the benefit of the public.
CONCLUSIONS OF LAW
The Idaho Public Utilities Commission has jurisdiction over Idaho Power, an electric
utility, and the issues raised in this matter pursuant to its authority under Title 61 of the Idaho
Code, specifically Idaho Code ~ 61-328, and the Commission s Rules of Procedure, IDAPA
31.01.01.000 et seq.
ORDER
IT IS HEREBY ORDERED that Idaho Power Company s Application for authority,
pursuant to Idaho Code ~ 61-328 and RP 52, to sell certain electric distribution facilities and
appurtenant rights-of-way owned by Idaho Power in southern Twin Falls County, Idaho to Raft
River Electric Cooperative, Inc. is approved.
ORDER NO. 30993
IT IS FURTHER ORDERED that Idaho Power Company shall file the relevant
closing documents, resulting accounting entries and the parties ' pole attachment agreement with
the Commission immediately following the closing of the approved transaction.
THIS IS A FINAL ORDER. Any person interested in this Order (or in issues finally
decided by this Order) may petition for reconsideration within twenty-one (21) days of the
service date of this Order with regard to any matter decided in this Order. Within seven (7) days
after 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 Utilities Commission at Boise, Idaho this d. 9'"
day of January 2010
J:2
//. ~
11 . KEMPTCfN SIDENT
MARSHA H. SMITH, COMMISSIONER
MACK A. REDFORD, CO
ATTEST:
~~rjD. Jew
Commission Secretary
O:IPC-09-- np2
ORDER NO. 30993