20080221Micron Comments.pdf

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Gary G. Allen
IDAHO PU BUGter G Barton
UTILITiES COÌ'''li¥W:i:wi¡.\iW' Beesontfifnr.:-olinder
Erik J. Bólinder
Willam C. Cole
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Jean Jewell
Idaho Public Utilities Commission
472 W. Washington
Boise, ID 83720-0074
Re:
Februar 20,2008
Jeremy G. ladle
Michael P. lawrence
Franklin G. lee
David R. Lombardi
John M. Marshall
Kenneth R. McClure
Kelly Greene McConnell
Cynthia A. Melilo
Christopher H. Meyer
L. Edward Miler
Patrick J. Miller
Judson B. Montgomery
Deborah E. Nelson
W. Hugh O'Riordan, lL.M.
G. Andrew Page
Angela M. Reed
Scott A. Tschirgi, lL.M.
J. Will Varin
Conley E. Ward
Robert B. White
Terr R. Yost
RETIRED
Kenneth L. Pursley
Raymond D. Givens
James A. McClure
In the Matter of the Appropriate Disposition of Proceeds for the Sale of
Idaho Power Company's S02 Emission Allowances in CY 2007 - Case
No.: IPC-E-07-18
4489-30Our File:
Dear Jean:
Enclosed for filing please find an original and seven (7) copies of Micron Technology's
Comments to Notice of Modified Procedure in connection with the above-captioned matter.
If you have any questions, please contact Conley Ward at [phone].
Vï:;Your, .~
EliZabet~
Administrative/Legal Assistant
/ehk
Enclosures: Orig. + Seven (7) Copies
cc: Service List (w/enclosures)
EHK to Jean Jewell re fiíng orig Micron Comments to Modified Procedure
'. ..
Conley E. Ward (ISB No. 1683)
GIVENS PURSLEY LLP
601 W. Bannock Street
P.O. Box 2720
Boise, ID 83701-2720
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4 2'...:.. . ..:".. ..
Attorneys for Micron Technology, Inc.
S:\Clients\4489\30\Micron Comments to Modified Procedure. DOC
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPROPRITE
DISPOSITION OF PROCEEDS FOR THE
SALE OF IDAHO POWER COMPANY'S
S02 EMISSION ALLOWANCES IN CY 2007
Case No. IPC-E-07-18
MICRON TECHNOLOGY, INC.'S
COMMENTS TO NOTICE OF
MODIFIED PROCEDURE
Micron Technology, Inc. ("Micron"), by and through its attorney of record, Conley E.
Ward, Givens Pursley LLP, respectfully submits the following comments in response to Order
No. 30495, dated February 4, 2008. For the reasons summarzed below, Micron supports the
Commission Staffs recommendation that the proceeds from the sale ofIdaho Power Company's
S02 emission allowances should be used to offset the rate increase that wil occur as a result of
the 2008 Power Cost Adjustment ("PCA").
1. Idaho Power's first proposed alternative for the use of the S02 proceeds-the
purchase of green tags in anticipation of future legal requirements-is inherently speculative
because current law does not require the purchase of green tags. Furthermore, even if green tag
purchases are ultimately required, there is no guarantee that prices will be higher than current
levels, as Idaho Power argues. In fact, basic economic principles would suggest that existing
green tag prices already discount effciently and accurately the likelihood of the imposition of
Micron Technology's Comments February 20, 2008
1
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green tag requirements and probable prices. If Idaho Power wishes to wager that it can outguess
the collective wisdom of the existing green tag market, it should do so with shareholder, rather
than ratepayer, funds.
2. Idaho Power's second alternative use for the S02 sale proceeds-the purchase of an
existing wind power development-also contains speculative elements. As Micron understands
Idaho Power's proposal, the Company would purchase the development rights to one or more as
yet unbuilt wind power sites. In essence, the ratepayers would be asked to take on all the risks
that accompany any type of property development. In a worst case scenaro, the purchased site
could turn out to be a "dry hole" that is never built because of economic or legal constraints. For
its part, Micron does not wish to be forced into the wind development business, and it
respectfully suggests many other Idaho Power ratepayers would agree.
3. Finally, all of the alternative proposed uses for the S02 sale proceeds, including the
suggested diversion of funds for conservation education, suffer from a common defect. One of
the reasons why large publicly traded utilities like Idaho Power exist is that their size and
monopoly status gives them access to investment capital on terms that most individual ratepayers
cannot begin to match. For example, the marginal cost of capital for many residential ratepayers
is effectively their interest charges on credit cards or consumer loans, often 15% or more per
year. Idaho Power, on the other hand, in its most recent rate case filing claimed an overall cost
of capital of approximately 8.5%, with a cost of debt financing roughly 150 basis points less than
this figure. Consequently, forcing ratepayers to become involuntar utility investors, however
laudable the proposed use of the funds may be, is a terrbly ineffcient and unfair waste of capital
resources, and it is contrary to the basic regulatory premise that utility investors voluntarly
Micron Technology's Comments February 20, 2008
2
c.
supply the needed capital to provide service, and the ratepayers in tum pay a fair return on that
capital.
CONCLUSION
For the reasons stated above, Micron urges the Commission to use the proceeds from the
sale of S02 emission allowances to offset the rate increase from the 2008 Power Cost
Adjustment case.
Respectfully submitted this 20th_day of Februar, 2008.
Co ey , Givens Pursley LLP ,
Attorneys for Micron Technology, Inc.
Micron Technology's Comments February 20, 2008
3
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 20th day of Februar, 2008, I caused to be served a
true and correct copy of the foregoing by the method indicated below, and addressed to the
following:
Jean Jewell
Idaho Public Utilities Commission
472 W. Washington Street
Boise, ID 83720-0074
U.S. Mail
'i Hand Delivered.Overnight Mail
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'f E-Mail
X U.S. Mail
Hand Delivered
Overnight Mail
Facsimile
'l E-Mail
Barton L. Kline
Lisa D. Nordstrom
Idaho Power Company
1221 W. Idaho Street (83702)
P.O. Box 70
Boise, ID 83707
email: bkline(ß).idahopower.com
lnordstrom(gìidahopowcr .com
John R. Gale
Idaho Power Company
1221 W. Idaho Street (83702)
P.O. Box 70
Boise, ID 83707
email: bklinc(a;idahopower.com
lnordstrom(ã(idahopower .com.
rgale(iidahopower. com
x U.S. Mail
Hand Delivered
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iE-Mail
Bin Chisholm
Idaho Energy Education Project
19073 E. Highway 30
Buhl, ID 833 i 6
email: chisholm3Ø)mindspring.com
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X E-Mail
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Peter J. Richardson
Richardson & O'Lear
515 N. 2ih Street
Boise, ID 83702
email: peter(ßrichardsonandoleary.com
Micron Technology's Comments February 20, 2008
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..
Linda Gervais X U.S. Mail
Avista Hand Delivered
1411 E. Mission Overnight Mail
Spokane, W A 99202 Facsimile
email:linda. gervais(§.avistacorp.com )(E-Mail
Celeste Schwendiman 'f U.S. Mail
Idaho Power Hand Delivered
1221 W. Idaho Overnight Mail
Boise, Idaho 83702 Facsimile
email: cschwendiman(f1idahopower.com 'f E-Mail
Donn English '¡U.S. Mail
Idaho Public Utilities Commission Hand Delivered
472 W. Washington Overnight Mail
Boise, Idaho 83720 Facsimile
email: donn.englishC£Ùpiic.idaho.gov f-E-Mail
Greg Said ;C U.S. Mail
Idaho Power Hand Delivered
1221 W. Idaho Overnght Mail
Boise, Idaho 83702 Facsimile
email:gsaidcg1idahopower.com f E-Mail
Joe Miller )C U.S. Mail,420 W. Banock Hand Delivered
Boise, Idaho 83702 Overnight Mail
email:joe(li)mcdevitt millcr.com ,ç FacsimileiE-Mail
Karl Bokenkamp )Ç U.S. MailiIdaho Power Hand Delivered
1221 W. Idaho Overnght Mail
Boise, Idaho 83702 Facsimile
email:kbokenkanipcgjdahopower. com t E-Mail
Ken Miler )f U.S. Mail
Snake River Alliance Hand Delivered
910 W. Jefferson Overnight Mail
Boise, Idaho Facsimile
email: kmillcrCßsnakcriveralliance.org
't E-Mail
Micron Technology's Comments February 20, 2008
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Patrick Ehrbar X U.S. Mail
Avista Hand Delivered
1411 E. Mission Overnght Mail
Spokane, W A 99202 Facsimile
email: pat.ehrbarrgavistacorp.com i E-Mail
Martin Fullenbaum U.S. Mail
Exeter Hand Delivered
Columbia, MD Overnight Mail
email: martinf(á¿exetcrassociates.com Facsimile
t E-Mail
Bjorn Doskeland 't U.S. Mail
Windland Hand Delivered
7669 W. Riverside Dr Overnight Mail
Boise, Idaho Facsimile
email: bjornrgwindland.com y.E-Mail
Mark Stokes y.U.S. Mail.Idaho Power Hand Delivered
1221 W. Idaho Overnight Mail
Boise, Idaho 83702 Facsimile
email: mstokes(f),idahopower.com 't E-Mail
Rick Sterling V.U.S. Mail
Commission Staff Hand Delivered
472 W. Washington Overnight Mail
Boise, Idaho Facsimile
email: rick.sterlingß!puc.idaho.gov 'l E-Mail
Rich Howard 'I U.S. Mail
Idaho Conservation League Hand Delivered
email: atlatl lCàJyahoo.com Overnight Mail
Facsimile
'£E-Mail
Rich Rayhil C U.S. Mail
Ridgeline Energy Hand Delivered
720 W. Idaho Overnight Mail
Boise, Idaho Facsimile
email: rrayhiUrgrl-en.com -lE-Mail
Micron Technology's Comments Febr.uary 20, 2008
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Randy Allphin
Idaho Power
1221 W. Idaho
Boise, Idaho 83702
rallphin(fDidahopower .com
Roald Doskeland
Windland, Inc.
7669 W. Riverside Dr.
Boise, Idaho 83704
email: wind(Çwindland.com
Terr Carlock, Senior Accountant
Idaho Public Utilities Commission
472 W. Washington
Boise, Idaho 83720-0074
email: terri.carlockCàJpucoidaho.gov
Randy Lobb
Commission Staff
472 W. Washington
Boise, Idaho
email: randy.iobb~ucoidaho,gov
. Micron Technology's Comments
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February 20, 2008
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