20110304Motion to Approve Stipulation.pdf

LISA D. NORDSTROM l\1i;nrJLead Counsel Ul\U \ \Cc_:'
Inordstrom(âidahopower.com
esIDA~POR~
An 10ACORP company
March 3, 2011
VIA HAND DELIVERY
Jean D. Jewell, Secretary
Idaho Public Utilties Commission
472 West Washington Street
P.O. Box 83720
Boise, Idaho 83720-0074
Re: Case No. IPC-E-10-27
IN THE MA ITER OF AN INVESTIGA TlON OF APPROPRIATE COST
RECOVERY MECHANISMS FOR IDAHO POWER'S ENERGY EFFICIENCY
PROGRAMS
Dear Ms. Jewell:
Enclosed for filing please find an original and seven (7) copies of Idaho Power
Company's Motion to Approve Stipulation in the above matter.
Also enclosed are nine (9) copies of Ric Gale's testimony filed in support of the
Stipulation. One copy of Mr. Gale's testimony has been designated as the "Reportets
Copy." In addition, a disk containing a Word version of Mr. Gale's testimony is enclosed
for the Reporter.
Very truly yours,~~r).~~
Lisa D. Nordstrom
LDN:csb
Enclosures
1221 W. Idaho St. (83702)
P.O. Box 70
Boise, 10 83707
LISA D. NORDSTROM (ISB No. 5733)
DONOVAN E. WALKER (ISB No. 5921)
Idaho Power Company
P.O. Box 70
Boise, Idaho 83707
Telephone: [phone]
Facsimile: [phone]
InordstromCâidahopower.com
dwalkerCâidahopower.com
REeE
lUll MAR -3 PM~: 46
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 AN INVESTIGATION
OF APPROPRIATE COST RECOVERY
MECHANISMS FOR IDAHO POWER'S
ENERGY EFFICIENCY PROGRAMS.
) CASE NO. IPC-E-10-27
)
) IDAHO POWER COMPANY'S
) MOTION TO APPROVE
) STIPULATION
)
COMES NOW, Idaho Power Company ("Idaho Powet' or "Company) and hereby
moves the Idaho Public Utilty Commission ("Commission") pursuant to RP 56 and 256
to approve the enclosed Stipulation on or before April 11, 2011. This Motion is based
on the following:
i. PROCEDURAL BACKGROUND
1. On October 22, 2010, Idaho Power requested that the Commission issue
its Order on or before March 15, 2011, accepting the Company's demand-side
resources business modeL. To this end, Idaho Power also requests authorization to: (1)
move demand response incentive payments into the Power Cost Adjustment ("PCA") on
IDAHO POWER COMPANY'S MOTION TO APPROVE STIPULATION - 1
a prospective basis beginning June 1, 2011, (2) establish a regulatory asset for Custom
Efficiency program incentive costs beginning January 1, 2011, and (3) change the
carrying charge on the Energy Efficiency Rider from the customer deposit rate to the
Company's authorized rate of return. The Company did not request a change in
customer rates as part of this docket.
2. On January 14, 2011, the Commission issued Procedural Order No.
32160 establishing the schedule as proposed by the parties. On February 7, 2011, the
parties convened a settlement conference as noticed in the earlier Procedural Order.
As a result of the discussions during the settlement conference, Idaho Power,
Commission Staff, the Idaho Conservation League, NW Energy Coalition, Snake River
Alliance, and Community Action Partnership Association of Idaho (the "Parties") agreed
to resolve the contested issues in the case. The terms of the agreement are set forth in
the Stipulation included as Attachment No. 1 to this Motion. Based upon the
representation that a settlement had been reached, the Commission issued Order No.
32178 on February 14, 2011, vacating the remainder of the procedural schedule and
setting new dates for comment and oral argument on the Stipulation.
3. Although it participated in the settlement conference, the Industrial
Customers of Idaho Power did not sign the Stipulation. In addition, although the Idaho
Irrigation Pumpers Association, Inc., did not sign the Stipulation, it does not oppose the
Stipulation.
II. TERMS OF THE STIPULATION
4. The Parties agree that recovery of demand response incentive payments
associated with the A1C Cool Credit program, the Irrigation Peak Rewards program, and
the FlexPeak Management program should be shifted from the Idaho Energy Efficiency
IDAHO POWER COMPANY'S MOTION TO APPROVE STIPULATION - 2
Rider ("Ridet') to the PCA on a prospective basis beginning June 1, 2011. To keep
customer classes revenue neutral until new base rates are established in Idaho Power's
next general rate case, an interim per kilowatt-hour ("kWh") tariff rate that recovers 100
percent of demand-side management ("DSM") costs shifted to the PCA wil be
implemented for each customer class in order to recover the same amount of revenue
from each class as would have been recovered through a DSM Rider percentage
charge against base rates. Idaho Power wil compute DSM revenue collection by
customer class for the PCA until such time as a level of demand response incentive
payments is reflected in the Company's base rates.
5. After demand response incentive payments are reflected in base rates,
100 percent of deviation from these base rate expenses wil be passed through the PCA
and recovered from customers using a uniform rate per kWh, consistent with all other
extraordinary power supply expenses. No agreement has been reached as to how
demand response incentive amounts wil be allocated to each customer class in an
Idaho Power general rate case and all Parties wil be able to propose allocation
methodology at that time.
6. The Parties agree that the direct incentive payments of the Custom
Efficiency program should be capitalized as a regulatory asset beginning January 1,
2011. A carrying charge equal to the current Commission authorized rate of return of
8.18 percent wil be applied to the balance unti the Commission includes the regulatory
asset in Company rates as part of its next general rate case. The regulatory asset once
placed in rates wil earn the current Commission-approved authorized rate of return and
wil be amortized over a seven-year period. Because the stream of incentive payments
is ongoing, a new regulatory asset subaccount wil accumulate between rate cases and
IDAHO POWER COMPANY'S MOTION TO APPROVE STIPULATION - 3
later become amortized over a separate seven-year period concurrent with a change in
rates.
7. The Parties agree that the Energy Efficiency Rider carrying charge wil
remain at the customer deposit rate.
8. The Parties agree that the Stipulation represents a fair, just, and
reasonable compromise of contested issues and that acceptance of the Stipulation by
the Commission would be in the public interest. Therefore, the Parties recommend that
the Commission approve the Stipulation and all of its terms and conditions without
material change or condition.
II. CONCLUSION
,9.For these reasons, Idaho Power requests that the Commission issue an
Order approving the enclosed Stipulation on or before April 11, 2011, to faciltate filng
of Idaho Powets PCA.
Respectfully submitted this 3rd day of March 2011.
~¿o.(f~LìšORDSTR
Attorney for Idaho Power Company
IDAHO POWER COMPANY'S MOTION TO APPROVE STIPULATION - 4
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on or about this 3rd day of March 2011 I served a true
and correct copy of the within and foregoing IDAHO POWER COMPANY'S MOTION
TO APPROVE STIPULATION upon the following named parties by the method
indicated below, and addressed to the following:
Commission Staff
Weldon B. Stutzman
Deputy Attorney General
Idaho Public Utilties Commission
472 West Washington
P.O. Box 83720
Boise, Idaho 83720-0074
Industrial Customers of Idaho Power
Peter J. Richardson
Gregory M. Adams
RICHARDSON & O'LEARY, PLLC
515 North 27th Street
P.O. Box 7218
Boise, Idaho 83702
Dr. Don Reading
Ben Johnson Associates
6070 Hil Road
Boise, Idaho 83703
Idaho Conservation League
Benjamin J. Otto
Idaho Conservation League
710 North Sixth Street
P.O. Box 844
Boise, Idaho 83701
NW Energy Coalition
Nancy Hirsh
NW Energy Coalition
811 1st Avenue, Suite 305
Seattle, Washington 98104
-2 Hand Delivered
U.S. Mail
_ Overnight Mail
FAX
-2 Email Weldon.Stutzman(âpuc.idaho.gov
Hand Delivered
-2 U.S. Mail
_ Overnight Mail
FAX
-2 Email petercarichardsonandoleary.com
gregcarichardsonandoleary.com
Hand Delivered
-2 U.S. Mail
_ Overnight Mail
FAX
-2 Email dreadingcamindspring.com
Hand Delivered
-2 U.S. Mail
_ Overnight Mail
FAX
-2 Email bottocaidahoconservation.org
Hand Delivered
U.S. Mail
_ Overnight Mail
FAX
-2 Email nancycanwenergy.org
IDAHO POWER COMPANY'S MOTION TO APPROVE STIPULATION - 5
Snake River Allance
Ken Miler
Snake River Allance
350 North 9th Street #B610
P.O. Box 1731
Boise, Idaho 83701
Idaho Irrgation Pumpers
Association, Inc.
Eric L. Olsen
RACINE, OLSON, NYE, BUDGE &
BAILEY, CHARTERED
201 East Center
P.O. Box 1391
Pocatello, Idaho 83204-1391
Anthony Yankel
Yankel & Associates, Inc.
29814 Lake Road
Bay Vilage, Ohio 44140
Community Action Partnership
Association of Idaho
Brad M. Purdy
2019 North 17th Street
Boise, Idaho 83702
Hand Delivered
U.S. Mail
_ Overnight Mail
FAX
-2 Email kmilercasnakeriverallance.org
Hand Delivered
-- U.S. Mail
_ Overnight Mail
FAX
-2 Email elocaracinelaw.net'
Hand Delivered
-- U.S. Mail
_ Overnight Mail
FAX
L Email tonycyankel.net
Hand Delivered
-- U.S. Mail
_ Overnight Mail
FAX
-- Email bmpurdychotmail.com
at,d.~Lisa D. Nordstro
IDAHO POWER COMPANY'S MOTION TO APPROVE STIPULATION - 6
BEFORE THE
IDAHO PUBLIC UTiliTIES COMMISSION
CASE NO. IPC-E-10-27
IDAHO POWER COMPANY
ATTACHMENT NO.1
LISA D. NORDSTROM (ISB No. 5733)
DONOVAN E. WALKER (ISB No. 5321)
Idaho Power Company
P.O. Box 70
Boise, Idaho 83707
Telephone: [phone]
Facsimile: [phone]
Inordstromcaidahopower.com
dwalkercaidahopower.com
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 AN INVESTIGATION )
OF APPROPRIATE COST RECOVERY ) CASE NO.IPC-E-10-27
MECHANISMS FOR IDAHO POWER'S )
ENERGY EFFICIENCY PROGRAMS. ) STIPULATION
)
This stipulation ("Stipulation") is entered into by and among Idaho Power
Company ("Idaho Powet' or "Company"); the Staff of the Idaho Public Utilties
Commission ("Staff); the Community Action Partnership Association of Idaho
("CAPAI"); and the Idaho Conservation League, the NW Energy Coalition, and the
Snake River Allance ("Conservation Parties"). These entities are collectively referred to
as the "Parties," and individually as "Party."
i. INTRODUCTION
1 . The Parties agree that this Stipulation represents a fair, just, and
reasonable compromise of contested issues and that acceptance of the Stipulation by
the Idaho Public Utilties Commission ("I PUC" or "Commission") would be in the public
STIPULATION - 1
interest. Therefore, the Parties recommend that the Commission approve the
Stipulation and all of its terms and conditions without material change or condition.
II. BACKGROUND
2. On October 22, 2010, Idaho Power filed an Application requesting that the
Commission issue an Order accepting the Company's demand-side resources business
model and adjust how the Company recovers the costs of specific demand-side
management ("DSM") programs. More specifically, the Company proposes to (1) move
associated demand response incentive payments into the Power Cost Adjustment
("PCA") on a prospective basis beginning June 1, 2011; (2) establish a regulatory asset
for Custom Efficiency program incentive costs beginning January 1, 2011; and (3)
change the carrying charge on the Energy Efficiency Rider from the customer deposit
rate to the Company's authorized rate of return. The terms and conditions of this
Stipulation shall impact only those DSM programs specified herein.
3. The parties convened a scheduling meeting on January 12, 2011, and
adopted a schedule to process the case as set forth in Order No. 32160. During the
course of the settlement conference that occurred on February 7, 2011, the Parties
reached the settlement agreement described below.
4. Although it participated in the settlement conference, the Industrial
Customers of Idaho Power did not sign the Stipulation.
5. Although the Idaho Irrigation Pumpers Association, Inc. did not sign the
Stipulation, it does not oppose the Stipulation.
II. TERMS OF THE STIPULATION
6. The Parties agree that recovery of demand response incentive payments
associated with the A1C Cool Credit program, the Irrigation Peak Rewards program, and
STIPULATION - 2
the FlexPeak Management program 1 should be shifted from the Idaho Energy Efficiency
Rider to the PCA on a prospective basis beginning June 1, 2011. To keep customer
classes revenue neutral until new base rates are established in Idaho Powets next
general rate case, an interim per kilowatt-hour ("kWh") tariff rate that recovers 100
percent of DSM costs shifted to the PCA wil be implemented for each customer class in
order to recover the same amount of revenue from each class as would have been
recovered through a percentage charge against base rates. Idaho Power wil compute
DSM revenue collection by customer class for the PCA until such time as a level of
demand response incentive payments is reflected in the Company's base rates.
7. After demand response incentive payments are reflected in base rates,
100 percent of deviation from these base rate expenses wil be passed through the PCA
and recovered from customers using a uniform rate per kWh, as are all other
extraordinary power supply expenses. No agreement has been reached as to how
demand response incentive amounts wil be allocated to each customer class in an
Idaho Power general rate case and all Parties wil be able to propose allocation
methodology at that time.
8. The Parties agree that the direct incentive payments of the Custom
Effciency program should be capitalized as a regulatory asset beginning January 1,
2011. A carrying charge equal to the current Commission authorized rate of return of
8.18 percent wil be applied to the balanæ until the Commission includes the regulatory
asset in Company rates as part of its next general rate case. The regulatory asset once
placed in rates wil earn the current Commission approved authorized rate of return and
1 FlexPeak Management program "demand response incentive payments" represent total
payments from Idaho Power to the third-party administrator, EnerNOC, Inc.
STIPULATION - 3
will be amortized over a seven-year period. Because the stream of incentive payments
is ongoing, a new regulatory asset subaccount wil accumulate between rate cases and
later become amortized over a separate seven-year period concurrent with a change in
rates.
9. The Parties agree that the Energy Efficiency Rider carrying charge wil
remain at the customer deposit rate.
IV. ADDITIONAL PROVISIONS
10. The Parties agree that this Stipulation represents a compromise of the
positions of the Parties. Therefore, other than any testimony filed in support of the
approval of this Stipulation, and except to the extent necessary for a Party to explain
before the Commission its own statements and positions with respect to the Stipulation,
all statements made and positions taken in negotiations relating to this Stipulation shall
be confidential and wil not be admissible in evidence in this or any other proceeding.
11. The Parties submit this Stipulation to the Commission and recommend
approval in its entirety. Parties shall support this Stipulation before the Commission,
and no Party shall appeal a Commission Order approving the Stipulation or an issue
resolved by the Stipulation. If this Stipulation is challenged by any person not a party to
the Stipulation, the Parties to this Stipulation reserve the right to file testimony, cross-
examine witnesses, and put on such case as they deem appropriate to respond fully to
the issues presented, including the right to raise issues that are incorporated in the
settlements embodied in this Stipulation. Notwithstanding this reservation of rights, the
Parties to this Stipulation agree that they wil continue to support the Commission's
adoption of the terms of this Stipulation.
STIPULATION - 4
12. If the Commission rejects any part or all of this Stipulation, or imposes any
additional material conditions on approval of this Stipulation, each Part reserves the
right, upon written notice to the Commission and the other Parties to this proceeding,
within fourteen days of the date of such action by the Commission, to vyithdrav, from this
Stipulation. In such case, no Part shall be bound or prejudiced by the terms of this
Stipulation, and each Part shall be entitled to seek reconsideration of the
Commission's Order, fie testimony as it chooses, cross-examine witnesses, and do all
other things necessary to put on such case as it deems appropriate.
13. No Part shall be bound, benefited, or prejudiced by any position asserted
in the negotiation of this Stipulation, except to the extent expressly stated herein, nor
shall this Stipulation be construed as a waiver of the rights of any Part unless such
rights are expressly waived herein. Execution of this Stipulation shall not be deemed to
constitute an acknowledgment by any Part of the validity nor invalidity of any particular
method, theory, or principle of regulation or cost recovery. No Part shall be deemed to
have agreed that any method, theory, or principle of regulation or cost recovery
employed in arriving at this Stipulation is appropriate for resolving any issues in any
other proceeding in the future. No findings of fact or conclusions of law other than those
stated herein shall be deemed to be implicit in this Stipulation.
14. The obligations of the Parties under this Stipulation are subject to the
Commission's approval of this Stipulation in accordance with its terms and conditions
and upon such approval being upheld on appeal by a court of competent jurisdiction.
15. This Stipulation may be executed in counterparts and each signed
counterpart shall constitute an original document.
STIPULATION - 5
;1
DATED this L day of ¡iLc£ 2011.
Idaho Power Company
By~.Qtbd.~
isa iirdstrom
Attorney for Idaho Power Company
Idaho Conservation League
By ~ æ;
Benjamin J. Otto
Attorney for Idaho Conservation League
Snake River Allance
BY&
Ken Miler
d: £/,
STIPULATION - 6
Idaho Public Utilties Commission Staff
J._...._-~ ~. ~ 2.?.By Weldon Stu an I
Attorney for Idaho Public Utilities
Commission Staff
NW Energy Coalition
By ~ti ø= L
Nancy Hirsh
Community Action Partnership
Association of Idaho
B~
Brad M. Purdy
Attorney for Community Action
Partnership Association of Idaho