20100316Application.pdf

DONOVAN E. WALKER
Senior Counsel
dwalkerlãidahopower.com
esIDA~POR~
An IDACORP Company
March 15,2010
VIA HAND DELIVERY
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-10-06
IN THE MA ITER OF THE APPLICA TlON OF IDAHO POWER COMPANY
FOR AUTHORITY TO INCREASE ITS RATES DUE TO THE INCLUSION
OF ADVANCED METERING INFRASTRUCTURE ("AMI') INVESTMENT IN
RATE BASE
Dear Ms. Jewell:
Enclosed for filing please find an original and seven (7) copies of Idaho Power
Company's Application in the above matter.
In addition, enclosed are nine (9) copies ofthe testimony of Courtney Waites filed in
support of the Application. One copy of Ms. Waites' testimony has been designated as the
"Reporter's Copy." In addition, a disk containing a Word version of Ms. Waites' testimony
is enclosed for the Reporter.
s
Donovan E. Walker
DEW:csb
Enclosures
P.O. Box 70 (83707)
1221 W. Idaho St.
Boise, 10 83702
DONOVAN E. WALKER (ISB No. 5921)
LISA D. NORDSTROM (ISB No. 5733)
Idaho Power Company
1221 West Idaho Street
P.O. Box 70
Boise, Idaho 83707
Telephone: [phone]
Facsimile: [phone]
dwalker(âidahopower.com
Inordstrom(âidahopower.com
RECEIV
ZOW MAR 15 PM 5= 06
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 MATTER OF THE APPLICATION OF )
IDAHO POWER COMPANY FOR ) CASE NO.IPC-E-10-06
AUTHORITY TO INCREASE ITS RATES )
DUE TO THE INCLUSION OF ADVANCED ) APPLICATION
METERING INFRASTRUCTURE ("AMI") )
INVESTMENT IN RATE BASE. )
)
Idaho Power Company ("Idaho Powet' or the "Company"), in accordance with
Idaho Code §§ 61-502 and 61-507 and Rules of Procedure ("RP") 52, 121, and 123,
hereby respectfully makes Application to the Idaho Public Utilties Commission ("IPUC"
or the "Commission") for authonty to increase its rates due to the inclusion of Advanced
Metering Infrastructure ("AMI") investment in rate base.
In support of this Application, Idaho Power represents as follows:
APPLICATION -1
I. INTRODUCTION
1 . Idaho Power is an Idaho corporation whose pnncipal place of business is
1221 West Idaho Street, Boise, Idaho. Idaho Power is engaged in the business of
generating, purchasing, transmitting, and distnbuting electrical energy and provides
retail electric service in the state of Idaho, and the state of Oregon. In conducting its
business, Idaho Power operates an interconnected and integrated system. In addition
to supplying electric service to the public, Idaho Power supplies electricity at retail to
certain special contract customers and makes wholesale sales of electricity to other
electric utilties. Idaho Power is subject to the junsdiction of this Commission, the Public
Utilty Commission of Oregon, and the Federal Energy Regulatory Commission.
2. The proposed increase in rates is the result of the inclusion of the
Company's investment in AMI for a 2010 test year into the Company's rate
base/revenue requirement. In Order No. 30726 issued on February 12, 2009, for Case
No. IPC-E-08-16, the Company was granted a Certificate of Public Convenience and
Necessity to install AMI technology throughout its service territory, to accelerate the
depreciation of its existing metering infrastructure, and to include the corresponding
Operations and Maintenance ("O&M") benefits as they occur. In Order No. 30829, for
Case No. IPC-E-09-07, the Commission authorized the Company to recover its
investment in AMI based on a 2009 test year.
3. The Company is seeking inclusion of the investments made for the
installation of AMI throughout its service territory during the 2010 test year. In its
calculations, the Company is reflecting the new investment in AMI and the depreciated
metering plant replaced by AMI. The Company also reflects the expenses of
APPLICATION - 2
accelerated depreciation of the pre-existing metering plant, the reduced O&M expenses
due to operating efficiencies that are gained from the AMI deployment, and incremental
tax impacts.
4. The Company seeks an effective date for the new rates of June 1, 2010,
to coincide with the yearly PCA, and possibly other rate adjustment(s). Given the
increased challenges associated with raising capital in the financial markets dunng the
present financial crisis, as well as the Company's competing needs for capital
investment in other system resources, the proposed test year and recovery of the
resulting revenue requirement is a necessary component to allow the Company to
continue moving forward with its three-year AMI deployment. This proposal is
consistent with both the Company's request for a Certificate of Public Convenience and
Necessity "to rate base the prudent capital costs of deploying AMI as it is placed in
service", Application, p. 11, Case No. IPC-E-08-16, and the prior authonzation of 2009
AMI investment recovery in Order No. 30829, Case No. IPC-E-09-07.
5. The Company investment associated with the installation of AMI grows
from $28,589,837 at year-end 2009 to $47,348,827 by December 31, 2010. The 13-
month average AMI plant in service for the test year is $38,615,913. The test year
indicates a revenue deficiency of $2,358,085 for the Idaho jurisdiction.
6. The Company proposes a uniform percentage increase of 0.41 percent to
base revenues for tanff Schedules 1, 3, 4, and 5 (Residential customers), Schedule 7
(Small General Service), Schedule 9 (Large General Service - Secondary), Schedule
24 (Agricultural Irngation Service - Secondary), Schedule 41 (Street Lighting Service -
APPLICATION - 3
Metered), and Schedule 42 (Control Traffc Signal Lighting Service) effective June 1,
2010, for service provided on and after that date.
II. PROPOSED TARIFF
7. Attachment NO.1 to this Application is a copy of Idaho Powets proposed
tariff sheets specifying the proposed rates for providing retail electric service to its
customers in the state of Idaho following inclusion of the requested AMI investment in
revenue requirement.
8. Attachment No.2 to this Application shows each proposed change in rates
and charges by striking over proposed deletions to existing tariff sheets and highlighting
or underlining proposed additions or amendments to the proposed tariff sheets.
9. Attachment No. 3 to this Application shows a comparison of revenues
from the vanous tariff customers under Idaho Powets existing rates and charges with
the corresponding proposed new revenue levels resulting from the proposed rates.
Page 1 includes a companson of current base revenues to proposed base revenues
while page 2 shows a comparison of current billed revenues to proposed biled
revenues.
10. Attachment No. 4 to this Application contains a copy of the Company's
press release that wil be distributed to media within the Company's service territory and
customer notice that wil be distributed to customers in their monthly billng.
11. This Application, together with Attachment Nos. 1, 2, 3, and 4 is filed with
the Commission to be kept open for public inspection as required by law, and the same
fully states the changes to be made in the rate schedules now in force. The new
electnc rate schedules contained in Attachment No. 1 are requested to become
APPLICATION - 4
effective June 1, 2010, for services provided on and after that date, unless otherwise
ordered by this Commission, and, when effective, wil supersede and cancel the present
electric rate schedules now in existence.
12. Simultaneously with the filng of this Application, Idaho Power has filed its
direct case consisting of the testimony and exhibits of Ms. Courtney Waites, which more
fully describes the request of the Company.
13. It is in the public interest that this Commission allow Idaho Power to
increase its revenues by approving the rates set out in Attachment No. 1 and that said
rates are allowed to go into effect as filed for electric service rendered on and after June
1, 2010, and that the effective date of said rates not be suspended.
II. MODIFIED PROCEDURE
14. Idaho Power believes that a heanng is not necessary to consider the
issues presented herein and respectfully requests that this Application be expeditiously
processed under Modified Procedure, i.e., by written submissions rather than by
hearing. RP 201 et seq. If, however, the Commission determines that a technical
hearing is required, the Company stands ready to present its testimony and support the
Application in such heanng.
IV. COMMUNCIATIONS AND SERVICE OF PLEADINGS
15. This Application wil be brought to the attention of Idaho Powets
customers by means of both a press release to media in the Company's service area
and a customer notice distributed in customers' bils, both of which are included herein
as Attachment No.4. The customer notice wil be distributed over the course of the
Company's current billng cycle, with the last notice being sent on Apnl 21, 2010. In
APPLICATION - 5
addition to describing this filng, these customer communications also descnbe recently
proposed rate changes associated with the Fixed Cost Adjustment ("FCA") and the
recovery of pension expense. Idaho Power wil also keep its Application, testimony, and
exhibits open for public inspection at its offces throughout the state of Idaho. The
above procedures are deemed by Idaho Power to satisfy the Rules of Practice and
Procedure of this Commission; however, the Company wil, in the alternative, bring the
Application to the attention of its affected customers through any other means directed
by this Commission.
16. Communications and service of pleadings with reference to this
Application should be sent to the following:
Donovan E. Walker
Lisa D. Nordstrom
Idaho Power Company
P.O. Box 70
Boise, Idaho 83707
dwalker(âidahopower.com
Inordstrom(âidahopower.com
Courtney Waites
Greg Said
Idaho Power Company
P.O. Box 70
Boise, Idaho 83707
cwaites(âidahopower.com
gsaid(âidahopower.com
v. REQUEST FOR RELIEF
17. Idaho Power respectully requests that the Commission issue an Order:
(1) authorizing that this matter may be processed by Modified Procedure, (2) approving
the new electric rate schedules set out in Attachment Nos. 1, 2, and 3 authonzing a
uniform percentage increase of 0.41 percent to Schedules 1, 3, 4, 5, 7, 9 secondary, 24
secondary, 41 metered, and 42 customers, and (3) approving an effective date of June
1, 2010, for the new rates.
APPLICATION - 6
DATED at Boise, Idaho, this 15th day of March 2010.
r.w~
DONOVAN E. WALKER
Attorney for Idaho Power Company
APPLICATION -7