20111116Youngblood Rebuttal.pdf

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BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
AUTHORITY TO INCREASE ITS RATES
AND CHARGES FOR ELECTRIC SERVICE
IN IDAHO.
CASE NO. IPC-E-II-08
IDAHO POWER COMPANY
REBUTTAL TESTIMONY
OF
MICHAEL J. YOUNGBLOOD
1 Q.Please state your name and business address.
2 A.My name is Michael J. Youngblood. My business
3 address is 1221 West Idaho Street, Boise, Idaho.
4 Q.Are you the same Michael Youngblood that
5 submitted direct testimony in this proceeding?
6 A.Yes, I am.
7 Q.What is the intent of your rebuttal testimony?
8 A.The intent of my rebuttal testimony is to
9 provide Idaho Power Company's (" Idaho Power" or "Company")
10 response to the pre-filed direct testimony of Dr. Don
11 Reading, Mr. Don Sturtevant, and Mr. Del Butler, all
12 witnesses for the Industrial Customers of Idaho Power
13 ("ICIP") .
14 Q .What is the scope of your rebuttal testimony?
15 A.I will respond to some of the allegations made
16 by the witnesses from ICIP regarding the calculation and
17 allocation of facilities charges, as well as provide
18 testimony describing a new tariff provision giving
19 customers the option to purchase Company-owned equipment
20 installed beyond Idaho Power's point of deli very. The
21 latter discussion is a direct response to requests made by
22 Mr. Sturtevant of the J.R. Simplot Company ("Simplot") who
2 3 has an interest in purchasing Company-owned facilities.
24 Q.Please describe the intent of the service
25 provided under a facilities charge arrangement.
YOUNGBLOOD, REB 1
Idaho Power Company
1 A.As described in more detail in the Rebuttal
2 Testimony of Mr. Warren Kline, the facilities charge
3 service was originally designed, and continues to provide,
4 a service primarily to our Schedule 9, Large General
5 Service, and Schedule 19, Large Power Service (Primary and
6 Transmission) service level customers by providing them an
7 option whereby the Company installs, owns, operates, and
8 maintains electric facilities beyond the Company's normal
9 point of delivery. Because facilities beyond the Company's
10 point of delivery are solely for the purpose of meeting the
11 electrical service requirements of an individual customer,
12 it is not appropriate to charge any other customers for the
13 investment and maintenance of those facilities. Therefore,
14 the facilities charge service was designed to provide a
15 means to charge specific customers the cost-of-service
16 related to facilities beyond the point of delivery which
17 are installed, owned, operated, and maintained by the
18 Company.
19 Q.Please describe at a high level how the
20 Company's facilities charge is calculated.
21 A.The Idaho Public Utilities Commission
22 ("Commission") approved methodology for calculating the
23 facilities charge is designed to provide a levelized rate
24 of cost recovery from individual customers using the same
25 cost components that are included for similar facilities
YOUNGBLOOD, REB 2
Idaho Power Company
1 under the Company's approved non-Ievelized determination of
2 the revenue requirement.In short, the facilities charge
3 is a levelized method for assigning costs, whereas the
4 cost-of-service approach is a point in time methodology of
5 assigning costs on a non-Ievelized basis.Both are
6 intended to recover, on average, the same amount of revenue
7 over time.
8 Q.How are the facilities charge revenues treated
9 in the Company's non-Ievelized determination of class-
10 specific base rate revenue requirements?
11 A.In the Company's non-Ievelized determination
12 of class-specific base rate revenue requirements, the
13 Company determines the total revenue required for recovery
14 on all distribution facilities-related investments,
15 including facilities beyond the Company's point of
16 delivery, as well as the associated operation and
17 maintenance expense and other administrative expenses.
18 This determination is made for each class of customers. As
19 part of this process, the revenues the Company receives
20 from providing facilities charge services are directly
21 assigned as a revenue credit, or an offset, to the revenue
22 requirements of the associated class of customers. As a
23 result, any differences between the non-Ievelized revenue
24 requirement and the levelized revenue requirement exist as
25 intra-class subsidies between those customers paying
YOUNGBLOOD, REB 3
Idaho Power Company
1 facili ties charges and those who do not wi thin each
2 customer class.
3 Q.Please explain how the levelized revenue
4 recovery from the facilities charge methodology for an
5 individual Schedule 19, Large Power Service, customer would
6 recover the same revenue as a non-Ievelized methodology
7 used for determining the revenue requirement for the
8 Schedule 19 customer class as a whole.
9 A.The chart below provides a pictorial
10 representation of the two cost recovery methodologies.
Cost Recovery Comparison
1"../" Non-Ievelized
è
....~
~....ÌìSæ
Levelized /~~
~----~--
Average Expected life
11
12 This chart shows an ever-decreasing revenue
13 requirement associated with plant investment that
14 depreciates over time. The total amount of revenue
YOUNGBLOOD, REB 4
Idaho Power Company
1 recovered from either mechanism is identical. The
2 difference is in the timing of the revenue recovery. In
3 the early years, the levelized methodology does not recover
4 the full revenue requirement needed, however, in the later
5 years, the levelized methodology provides more than would
6 be required under the non-Ievelized approach. It is
7 important to note that the revenue requirement for
8 facili ties charge customers is an estimate of cost the
9 Company incurs to provide facilities beyond the Company's
10 point of delivery. This revenue requirement determination
11 is only used to offset the costs that are already being
12 collected through customers' rates, in this example
13 Schedule 19. With that said, regardless of the amount of
14 the facilities charge and the associated revenue, the
15 revenue offset treatment applied by the Company ensures
16 that Idaho Power only earns its allowed rate of return on
17 all non-depreciated plant balances, including facilities
18 beyond the point of delivery.
19 Q.How is this example applicable to the
20 determination of the facilities charge?
21 A.It would be very complicated and not practical
22 to determine an individual revenue requirement for each and
23 every customer who has facilities beyond the Company's
24 point of delivery. If the Company would take that
25 approach, as suggested by the ICIP witnesses, not only
YOUNGBLOOD, REB 5
Idaho Power Company
1 would the calculated facilities charge service rate be
2 different for each of the approximately 240 facilities
3 charge customers the Company currently maintains in Idaho,
4 but the rate would continually change for each of those
5 customers. In addition, when the Company's investment in
6 facili ties changed due to replacement of failed facilities,
7 the individual's rate could change again significantly,
8 depending on their position in time along the curve with
9 regard to the recovery of investment.
10 Q.If the Commission were to adopt ICIP's
11 recommendation for determining an individual facilities
12 charge rate for each facilities charge customer, would
13 there be an effect to the remaining customers in the class?
14 A.Yes. As shown in the chart above, when the
15 levelized facilities charge recovery is less than the non-
16 levelized rate, the amount of revenue requirement shortfall
17 for the individual facilities charge customer is being
18 subsidized by the remainder of the class. In the later
19 years, when the levelized facilities charge is greater than
20 the necessary revenue requirement at that time, the
21 facilities charge customer is paying back the previous
22 subsidy. These intra-class subsidies are an expected and
23 normal outcome of the levelized approach for ratemaking.
24 Because the facilities charge revenue is an offset to the
25 revenue requirement of that customer's class, any change in
YOUNGBLOOD, REB 6
Idaho Power Company
1 the facilities charge for an individual customer would
2 change the amount of the revenue credit being received as
3 an offset to the revenue requirement of the class. This
4 would require that a new revenue requirement determination
5 be made to adj ust the base rates of the entire class.
6 Thus, to adopt the recommendation of ICIP, the Company
7 would be required to recalculate its revenue requirement
8 for each customer class that has the facilities charge any
9 time there is a change in the facilities charge rate for an
10 individual customer. An approach such as this would be
11 extremely complicated to administer and would require
12 continual changes to the base rates of the class.
13 Q.What are the ratemaking issues associated
14 with tracking actual depreciation levels for each
individual piece of equipment subject to the facilities
charge,as proposed by ICIP?
A.While it is impractical to have an individual
15
16
17
18 facilities charge rate for each customer as I described
19 above, to track the actual depreciation levels for each
2 0 individual piece of equipment subj ect to a facilities
21 charge for ratemaking purposes would be even more
22 complicated. The implication, as suggested by ICIP witness
23 Dr. Reading, would be to have a separate facilities charge
24 rate for each of the thousands of individual pieces of
25 equipment for each of the 240 individual facilities charge
YOUNGBLOOD, REB 7
Idaho Power Company
1 customers in Idaho. Under Dr. Reading's approach, this
2 would mean that the Company would be required to determine
3 its revenue requirement any time a single piece of
4 facili ties charge equipment depreciated. The end result
5 would be an administrative nightmare and unduly burdensome
6 for the Company, as well as increasing the complexity of
7 the facilities charge rate.
8 Q.Does the Company track depreciation levels for
9 indi vidual facilities for any other customer class or
10 service?
11 A.No. It is a standard ratemaking practice to
12 average the actual levels of depreciation together for a
13 particular level of service or customer class and spread
14 the recovery of those costs equally to all customers within
15 the class.
16 Q.Does the Company believe that the facilities
17 charges proposed in this proceeding are fair, just, and
18 reasonable?
19 A.Yes. The Company's proposed facilities
20 charges in this proceeding were developed under the
21 methodology approved by this Commission in prior
22 proceedings and will result in charges to customers that
23 are fair, just, and reasonable.
24
25
YOUNGBLOOD, REB 8
Idaho Power Company
1 Q.What is the Company's response to ICIP's
2 suggestion that the Company should simply give away fully
3 depreciated facilities to facilities charge customers?
4 A.Even if the Company were to consider this
5 proposition, which it is not, ICIP's proposal would not be
6 administratively feasible. As I have described above, the
7 Company does not depreciate for ratemaking purposes
8 individual pieces of equipment separately, so determination
9 of when an individual piece of equipment was fully
10 depreciated would be nearly impossible. In addition,
11 "turning over~ specific pieces of equipment which are
12 "fully depreciated" while leaving pieces of equipment that
13 are not "fully depreciated" would result in mixed ownership
14 of facilities, which is contrary to the Company's current
15 policy because it creates operational and safety issues, as
16 described by Mr. Kline. The facilities charge has never
17 been a "lease-to-own" charge, such that a customer would
18 pay an amount for a number of years, and then have that
19 piece of equipment given to them at no cost. Instead, the
20 service provided under a facilities charge arrangement is
21 intended to collect additional revenue that is used to
22 offset the costs the Company incurs to own, operate, and
23 maintain facilities installed beyond the Company's point of
24 delivery that are solely for the purpose of meeting the
25 service requirements of one customer.
YOUNGBLOOD, REB 9
Idaho Power Company
1 Q.Do existing facilities charge customers have
2 the option today of owning and operating their own
3 electrical equipment in order to eliminate the facilities
4 charge they are paying?
5 A.Yes. In accordance with the tariff
6 provisions, a customer may request the Company to remove
7 Company-owned facilities beyond the Company's point of
8 delivery. The customer would pay the Company the "non-
9 salvable cost" of such removal, which is comprised of the
10 total depreciated costs of materials, labor, and overheads
11 of the facilities, less the difference between the salvable
12 cost of material removed, and removal labor cost including
13 appropriate overhead costs. All facilities charge
14 customers have this option today. In fact, on August 25,
15 2011, Simplot made such a formal request to the Company to
16 provide a quote for the removal of Company-owned facilities
17 from its locations. The Company responded by inviting
18 Simplot to meet with Company's operational and engineering
19 personnel to develop such a plan.
20 Q.Has the Company proposed an option for
21 customers to purchase Company-owned facilities beyond its
22 point of delivery?
23 A.Yes. The Company is proposing in this case to
24 provide changes to its tariff language that would allow
25 facilities charge customers with a buyout option.
YOUNGBLOOD, REB 10
Idaho Power Company
1 Q.Please describe the Company's proposal for
2 tariff language changes in order to provide facilities
3 charge customers with a buyout option.
4 A.The Company is proposing to create a new rule,
5 Rule M - Facilities Charge Service, which would fully
6 describe the Company's rules and policies for providing
7 facili ties charge services. Currently, rules for
8 facili ties charges are located in various schedules.
9 Consolidating facilities charge rules and policies into a
10 single rule will allow the Company to more efficiently
11 manage tariff issues related to facilities charge services,
12 as well as provide facilities charge customers with more
13 transparency related to facilities charge rules and
14 policies. Exhibit 52 is a copy of the Company's proposed
15 new Rule M. Within Rule M, the Company describes the
16 responsibilities of the Company to provide ownership,
17 operation, and maintenance of Company-owned facilities
18 beyond the Company's point of deli very in consideration of
19 the customer paying a facilities charge approved by the
20 Commission. In addition, the Company has provided a new
21 option for customers who may request to purchase Company-
22 owned facilities installed beyond the point of delivery.
23 As stated in the new provisions of the Company's proposed
24 Rule M, all sales must be approved by the Commission and
25 meet the following provisions:
YOUNGBLOOD, REB 11
Idaho Power Company
1 . Idaho Code Section 61-328;
2 . no mixed ownership of facilities;
3 . the customer must provide the operation and
4 maintenance of all facilities installed beyond the point of
5 delivery after the sale is complete; and
6 . the customer must pay for the engineering
7 costs for determination of the sale.
8 Q.What do the provisions of Idaho Code Section
9 61-328 provide?
10 A.Wi thin Idaho Code Section 61-328, it states
11 that before authorizing the sale of public utility owned
12 property, the Commission shall find that the transaction is
13 consistent with the public interest; that the cost of and
14 rates for supplying service will not be increased by reason
15 of the sales transaction; and that the customer who would
16 be making the purchase has the bona fide intent and
17 financial ability to operate and maintain the property
18 purchased.
19 Q.How does the Company interpret the provisions
20 of Idaho Code Section 61-328 with regard to providing
21 customers with a buyout option of Company-owned facilities
22 beyond the point of delivery?
23 A.In order for the Company to agree to the sale
24 of its facilities beyond the point of delivery, the Company
25 would need to determine that none of its remaining
YOUNGBLOOD, REB 12
Idaho Power Company
1 customers would be adversely impacted by the sale of those
2 facili ties. Specifically, the Company would need to ensure
3 that the appropriate equipment is in place at the point of
4 delivery such that no equipment failure or malfunction
5 would result in a degradation of the Company's reliability
6 and service to its remaining customers. In addition, the
7 Company would need to ensure that customers' rates, which
8 may include a revenue credit from revenues collected
9 through the facilities charge, would not be adversely
10 impacted by the sale. If these conditions were met, the
11 Company would make a filing with the Commission for each
12 proposed sale asserting that such sale would be in the
13 public interest.
14 Q.Has the Company determined a proposed
15 methodology for determining the sales price for the sale of
16 facilities beyond the point of delivery?
17 A.No. The Company is not proposing any specific
18 pricing methodology in this case, just the proposal to
19 change its tariffs in order to provide an option for
20 customers to purchase the facilities. If the Company's
21 proposed tariff language is adopted and approved by the
22 Commission, and if and when a customer requests the
23 purchase of facilities beyond the Company's point of
2 4 delivery, the Company would attempt to determine a mutually
25 agreed upon price for the sale of the facilities prior to
YOUNGBLOOD, REB 13
Idaho Power Company
1 bringing the sales transaction to the Commission for
2 approval. If a sales price cannot be mutually agreed upon,
3 the Company or the customer may initiate a proceeding
4 before the Commission in order to determine the
5 appropriateness of the price.
6 Q.Are there other provisions of the new buyout
7 option the Company wishes to discuss?
8 A.Yes. The Company's proposal would include the
9 provisions that there be no mixed ownership of facilities.
10 In other words, the customer would need to purchase all of
11 the Company-owned equipment beyond the point of delivery,
12 not just pick and choose which pieces of equipment they
13 would want to purchase. Also, Idaho Power would not
14 perform any operation or maintenance of the facilities once
15 they have been purchased. Such acti vi ties would be an
16 unregulated activity for services rendered beyond the
17 Company's point of delivery, and is not a part of the
18 Company's core business practices.
19 Q.If facilities charge customers elect this new
20 tariff option and purchase Company-owned facilities, would
21 that same customer have the option in the future to sell
22 the facilities back to the Company and have the Company
23 maintain and operate those facilities?
24
25
YOUNGBLOOD, REB 14
Idaho Power Company
1 A.No. Once a customer elects this new tariff
2 provision and the Company sells them Company-owned
3 facili ties, the customer will be solely responsible for
4 maintaining and operating those facilities on a going-
5 forward basis.
6 Q.Are you proposing anything else which responds
7 to the issues raised by ICIP witnesses in their direct
8 testimony?
9 A.Yes. The witnesses for ICIP expressed concern
10 over the fact that the Company had no record of customers
11 requesting that the Company install, own, operate, and
12 maintain electrical facilities beyond the Company's point
13 of delivery in consideration for the payment of a
14 facili ties charge. As described earlier in my testimony
15 and in the testimony of Mr. Kline, the facilities charge
16 service is a service the Company provides at the request of
17 the customer, and which the Company has the discretion to
18 accept or rej ect providing that service. That said, ICIP
19 witnesses are correct that in many instances there is no
20 written record or contract memorializing the fact that the
21 Company was agreeing to provide this service on behalf of
22 the customer. Therefore, the Company is proposing the
23 Facilities Charge Consent and Acknowledgement Form which
24 will be signed by all customers requesting to enter into a
25 Facilities Charge Services arrangement. The new form will
YOUNGBLOOD, REB 15
Idaho Power Company
1 be a part of the Company's newly proposed Rule M and is
2 provided on page three of Exhibit 52. The form is intended
3 specifically on a going-forward basis for new facilities
4 charge transactions. However, the Company also commits to
5 communicate with all of its existing facilities charge
6 customers to provide them with the opportunity to sign the
7 form and provide information regarding the new proposed
8 facili ties charge buyout option.
9 Q.Is the Company proposing any changes to the
10 existing methodology for determining the appropriate
11 facilities charge?
12 A.No. The Commission-approved methodology that
13 the Company currently uses is appropriate and fair to all
14 customers. The Company maintains that the facilities
15 charge rate reduction that was proposed in the Direct
16 Testimony of Mr. Scott Sparks is fair and reasonable. The
17 Company continues to encourage the Commission to adopt its
18 proposed revised monthly facilities charge rates of 1.41
19 percent for customers taking Primary or Transmission
20 Service under Schedules 9 and 19. The Company is also
21 proposing a rate of 1.41 percent for customers taking
22 Transmission Service under Schedule 24.
23 For customers currently paying a facilities charge
24 under Schedule 15, the Company continues to propose a rate
25 of 1.51 percent per month and for customers currently
YOUNGBLOOD, REB 16
Idaho Power Company
1 paying a facilities charge under Schedule 41, the Company
2 is proposing a rate of 1.21 percent per month consistent
3 with the direct testimony provided by Mr. Sparks in this
4 case.
5 Q.Is it true, as Mr. Sturtevant points out in
6 his direct testimony, that the Company is not proposing to
7 update the facilities charge rate for the Simplot special
8 contract, Schedule 29?
9 A.No, that is not true. While the Company did
10 not specifically discuss the revised special contract
11 Schedule 29 in its direct testimony, the updated rate was
12 included in the proposed Schedule 29 tariff sheet submitted
13 with the Company's Application in both Attachment No. 1 and
14 Attachment No.2. The proposed revised facilities charge
15 rate for the special contract Schedule 29 is 1.41 percent,
16 the same reduction as is being proposed for the Company's
17 Schedule 19 customers.
18 Q.Have the signing parties to the general rate
19 case settlement stipulation ("Stipulation") submitted in
20 this proceeding agreed to any provision in the event that
21 the Commission adopts ICIP's recommendation to modify the
22 existing facilities charge methodology such .that it changes
23 the amount of revenue proposed to be recovered through the
24 facilities charge?
25
YOUNGBLOOD, REB 17
Idaho Power Company
1 A.Yes. Paragraph 11 (c) of the Stipulation
2 submitted on September 23, 2011, in this proceeding
3 provides that the "Signing Parties agree that any revenue
4 requirement impacts resulting from changes to the
5 facili ties charge methodology or changes in property
6 ownership shall be directly assigned to Schedule 19
7 customers in the form of a base rate increase or reduction
8 so that no other customer classes shall be impacted by any
9 resulting change."
10 Q .What would be the impact of this provision of
11 the Stipulation if the Company were to give away Company-
12 owned facilities to customers for free, as proposed by
13 ICIP?
14 A.If the Company were to assign ownership of
15 fully depreciated facilities to customers, as advocated by
16 ICIP, the Company would experience a shortfall to its
17 revenue requirement. Per the Stipulation, the Company
18 would directly assign to all Schedule 19 customers an
19 increase in rates to make-up for that revenue shortfall.
20 Q.Do you have any concerns with the proposal to
21 give away facilities made by ICIP?
22 A.Yes, I do. As explained in Mr. Kline's
23 testimony, of the Company's approximately 240 facilities
24 charge customers in Idaho, Simplot is the only facilities
25 charge customer in recent memory that has formally
YOUNGBLOOD, REB 18
Idaho Power Company
1 requested a buyout option. I believe, as does Mr. Kline,
2 that this indicates that the vast maj ori ty of the Company's
3 other facilities charge customers have appreciated and
4 benefited from the Company operating and providing
5 maintenance on facilities that they would have had to pay
6 for and maintain themselves. The Company submitted data
7 requests to ICIP asking which of their members are actively
8 participating in this case and whether any of their members
9 would be willing to purchase Company-owned facilities
10 knowing that they would need to maintain those facilities
11 once sold. The intent of these data requests was to
12 determine which of ICIP's members were aware that the ICIP
13 proposal could result in a rate increase. ICIP refused to
14 answer these questions. So, ultimately, Idaho Power has no
15 way of knowing whether the proposals made by ICIP are
16 representative of all of its members, let alone all of the
17 approximately 240 facilities charge customers in Idaho.
18 Q.Did the Industrial Customers of Idaho Power
19 sign the Stipulation in Case No. IPC-E-II-08?
20 A.Yes. Mr. Peter Richardson, Attorney for
21 Industrial Customers of Idaho Power, signed the Stipulation
22 on September 21, 2011.
23 Q.Is the Company proposing any additional
24 commitments with regard to its facilities charge service?
25
YOUNGBLOOD, REB 19
Idaho Power Company
1 A.Yes. Since the revenue received from
2 facili ties charge customers reduces the revenue requirement
3 of the associated class, the Company commits to performing
4 a review and potential update of its facilities charge rate
5 as part of each future general rate case filing. In this
6 way, the facilities charge rate will be subj ected to not
7 only the Company's internal review on a regular basis as it
8 has in the past, but will be scrutinized by the Commission
9 and interested intervening parties as part of the revenue
10 requirement determination.
11 Q.Does this conclude your rebuttal testimony in
12 this case?
13 A.Yes, it does.
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YOUNGBLOOD, REB 20
Idaho Power Company
BEFORE THE
IDAHO PUBLIC UTiliTIES COMMISSION
CASE NO. IPC-E-11-08
IDAHO POWER COMPANY
YOUNGBLOOD, REB
TESTIMONY
EXHIBIT NO. 52
Idaho Power Company
I.P.U.C. No. 29. Tariff No. 101 Original Sheet No. M-1
RULEM
FACILITIES CHARGE SERVICE
This rule applies to eligible customers taking Primary or Transmission Service under Schedules
9 and 19 or Transmission Service under Schedule 24. Eligible Customers may request that the
Company design, install. own, and operate transformers and other facilties beyond the Point of
Delivery that are solely provided to meet the Customer's service requirements. This service is provided
at the Customets request and at the option of the Company in exchange for the Customer paying a
monthly facilties charge to the Company. Primary and Transmission Service level Customers not
taking facilties charge services are responsible for providing the transformation of power beyond the
Point of Delivery needed to meet the Customets service requirements. See Rule B.
1. Company-Owned Facilties Beyond the Point of Delivery
Under a facilties charge arrangement, the Company will own and operate facilties beyond the
Point of Delivery that are installed to solely benefit the Customer, and the Customer wil pay a
monthly facilties charge to the Company based on a percentage of the value of the facilties
installed. As part of this arrangement, the Customer agrees to allow Idaho Power access to the
Customer's property to provide installation of facilties, operation and maintenance, alteration,
relocation, upgrade, conversion, and/or removal in order to meet the Customer's service
requirements. The Customer agrees to provide rights-of-way as outlined in Rule C.
Company-owned facilties beyond the Point of Delivery wil be set forth in a Distribution Facilties
Investment Report (DFI) provided to the Customer. As the Company's investment in facilties
beyond the Point of Delivery changes in order to meet the Customer's service requirements, the
Company shall notify the Customer of the additions and/or deletions of facilties by forwarding to
the Customer a revised DFI. The Company wil also adjust the monthly facilties charge to be
paid by the Customer based on any increase or decrease in the value of the Company-owned
facilties resulting from additions and/or deletions as set forth in the revised DFI.
2. Alteration and Failure of Company-Owned Facilties
In the event the Customer requests the Company to alter (remove, reinstall, or change)
Company-owned facilties beyond the Point of Delivery, the Customer shall pay to the Company
the "non-salvable cost" of such removal, reinstallation, or change. Non-salvable cost as used
herein is comprised of the total depreciated costs of materials, labor, and overheads of the
facilties, less the difference between the salvable cost of material removed, and removal labor
cost including appropriate overhead costs.
Failed equipment wil be replaced by the Company as part of providing ongoing operation and
maintenance of Company-owned facilties installed beyond the Point of Delivery. When a failed
piece of equipment is replaced by the Company, the value of the failed piece of equipment wil
be removed from the Customer's DFI and replaced with the value of the new piece of equipment
to calculate the Customer's monthly facilities charge.
Exhibit No. 52
Case No. IPC-E-11-08
M. Youngblood, IPC
Page 1 of 3
IDAHO
Issued per Order No.
Effective - January 1, 2012
Issued by IDAHO POWER COMPANY
Gregory W. Said, Vice President, Regulatory Affairs
1221 West Idaho Street, Boise, Idaho
Idaho Power Company
I.P.U.C. No. 29. Tariff No. 101 Original Sheet No. M-2
RULEM
FACILITIES CHARGE SERVICE
3. Sale of Company-Owned Facilties
Customers paying a facilties charge may request to purchase Company-owned. facilties
installed beyond the Point of Delivery. All sales of facilties must be approved by the
Commission and meet the following provisions:
a. Idaho Code Section 61-328.
b. No mixed ownership of facilties. A Customer purchasing Company-owned facilties
installed beyond the Point of Delivery must purchase all facilties listed on the DFI for
that location.
c. The Customer must provide the operation and maintenance of all facilties installed
beyond the Point of Delivery after the sale is complete.
d. The Customer must prepay engineering costs for sales determinations taking greater
than 16 estimated hours of preparation. Sales determinations equal to or less than 16
estimated hours of preparation wil be billed to the Customer as part of the sales
agreement, or after the engineering is completed in instances where the sale is not
finalized.
4. Monthly Facilties Charge Rate
Effective January 1, 2012, a facilties charge, as specified in Schedule 66, wil be assessed on
each facilties charge customer's monthly biling.
5. Consent and Acknowledge Form
Prior to entering into a facilties charge arrngement, the Customer and Company must agree to
and sign the Facilties Charge Service Consent and Acknowledgement Form attached to this
rule.
Exhibit No. 52
Case No. IPC-E-11-08
M. Youngblood, IPC
Page 2 of3
IDAHO
Issued per Order No.
Effective - January 1, 2012
Issued by IDAHO POWER COMPANY
Gregory W. Said, Vice President, Regulatory Affairs
1221 West Idaho Street, Boise, Idaho
Idaho Power Company
I.P.U.C. No. 29. Tariff No. 101 Original Sheet No. M-3
RULEM
FACILITIES CHARGE SERVICE
Idaho Power Company
Facilties Charge Service
Consent and Acknowledgement Form
By signing this form, Idaho Power Company ("Idaho Power") and
("Customer") hereby consent to and acknowledge the following:
1. Idaho Power wil design, install, own, and operate transformers and other facilties on the
Customer's propert which are beyond Idaho Powets Point of Delivery and are solely provided to meet
the Customer's service requirements at the following Customer location:
2. This service is provided at the Customer's request and at the option of Idaho Power in
exchange for the Customer paying a monthly facilties charge to Idaho Power as listed in Schedule 66
of Idaho Power's current and effective tariff.
3. Idaho Power and the Customer agree that this arrangement is provided under the terms
and conditions of Rule M, Facilties Charge Service, of Idaho Power's current and effective tariff.
Dated:
IDAHO POWER COMPANY CUSTOMER
Exhibit No. 52
Case No. IPC-E-11-08
M. Youngblood, IPC
Page 3 of3
IDAHO
Issued per Order No.
Effective - January 1 , 2012
Issued by IDAHO POWER COMPANY
Gregory W. Said, Vice President, Regulatory Affairs
1221 West Idaho Street, Boise, Idaho
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on this 16th day of November 2011 I served a true and
correct copy of the within and foregoing REBUTTAL TESTIMONY OF MICHAEL J.
YOUNGBLOOD upon the following named parties by the method indicated below, and
addressed to the following:
Commission Staff
Donald L. Howell, II
Karl T. Klein
Deputy Attorneys General
Idaho Public Utilities Commission
472 West Washington (83702)
P.O. Box 83720
Boise, Idaho 83720-0074
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FAX
-2 Email Don.Howelltãpuc.idaho.gov
Karl. Klei naypuc. idaho .gov
Industrial Customers of Idaho Power
Peter J. Richardson
Gregory M. Adams
RICHARDSON & O'LEARY, PLLC
515 North 2ih Street (83702)
P.O. Box 7218
Boise, Idaho 83707
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-2 Email peterayrichardsonandoleary.com
9 regayrichardsonandoleary. com
Dr. Don Reading
Ben Johnson Associates, Inc.
6070 Hil Road
Boise, Idaho 83703
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-2 Email draybenjohnsonassociates.com
Idaho Irrigation Pumpers Association, Inc.
Eric L. Olsen
RACINE, OLSON, NYE, BUDGE &
BAILEY, CHARTERED
201 East Center
P.O. Box 1391
Pocatello, Idaho 83204-1391
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-2 Email eloayracinelaw.net
Anthony Yankel
29814 Lake Road
Bay Vilage, Ohio 44140
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-2 Email tonyayyankel.net
CERTIFICATE OF SERVICE - 1
The Kroger Co.
Kurt J. Boehm
BOEHM, KURTZ & LOWRY
36 East Seventh Street, Suite 1510
Cincinnati, Ohio 45202
Kevin Higgins
Energy Strategies, LLC
215 South State Street, Suite 200
Salt Lake City, Utah 84111
Micron Technology, Inc.
MaryV. York
HOLLAND & HART, LLP
101 South Capital Boulevard, Suite 1400
Boise, Idaho 83702
Richard E. Malmgren
Senior Assistant General Counsel
Micron Technology, Inc.
800 South Federal Way
Boise, Idaho 83716
The United States Department of Energy
Arthur Perry Bruder, Attorney-Advisor
United States Department of Energy
1000 Independence Avenue SW
Washington, DC 20585
Dwight D. Etheridge
Exeter Associates, Inc.
10480 Little Patuxent Parkway, Suite 300
Columbia, Maryland 21044
CERTIFICATE OF SERVICE - 2
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-1 Email kboehmCâBKLlawfirm.com
jrhCâbattisher.com
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-1 Email khigginsCâenergystrat.com
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-1 Email myorkCâhollandhart.com
tnelsonCâholland hart.com
madavidsonCchollandhart.com
fschmidtCcholland hart. com
InbuchananCchollandhart.com
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-1 Email remalmgrenCcmicron.com
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-1 Email Arthur.bruderCchq.doe.gov
Steven. porterCchq .doe.gov
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-1 Email detheridgeCcexeterassociates.com
Community Action Partnership
Association of Idaho
Brad M. Purdy
Attorney at Law
2019 North 1 ih Street
Boise, Idaho 83702
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.- Email bmpurdy((hotmail.com
Idaho Conservation League
Benjamin J. Otto
Idaho Conservation League
710 North Sixth Street (83702)
P.O. Box 844
Boise, Idaho 83701
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.- Email bottoaRidahoconservation.org
Snake River Allance
Ken Miler
Snake River Allance
P.O. Box 1731
Boise, Idaho 83701
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.- Email kmilleraRsnakeriverallance.org
NW Energy Coalition
Nancy Hirsh, Policy Director
NW Energy Coalition
811 First Avenue, Suite 305
Seattle, Washington 98104
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.- Email nancYaRnwenergy.org
Hoku Materials, Inc.
Dean J. Miler
McDEVITT & MILLER LLP
420 East Bannock (83702)
P.O. Box 2564
Boise, Idaho 83701
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.- Email joeaRmcdevitt-miler.com
heatheraRmcdevitt-miller.com
Scott Paul, CEO
Hoku Materials, Inc.
One HokuWay
Pocatello, Idaho 83204
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.- Email spaulaRhokucorp.com
o\Rfi~
Lisa D. Nordstii .
CERTIFICATE OF SERVICE - 3