20111102notice_of_application_order_no_32389.pdf

Office of the Secretary
Service Date
November 2,2011
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF IDAHO POWER COMPANY FOR )CASE NO.IPC-E-11-19
AUTHORITY TO CONVERT SCHEDULE 54 )
-FIXED COST ADJUSTMENT -FROM A )NOTICE OF APPLICATION
PILOT SCHEDULE TO AN ONGOING )PERMANENT SCHEDULE )NOTICE OF
)INTERVENTION DEADLINE
)
______________________________
)ORDER NO.32389
YOU ARE HEREBY NOTIFIED that on October 19,2011,Idaho Power Company
filed an Application requesting a Commission Order authorizing the Company to convert its
current Schedule 54 —Fixed Cost Adjustment (FCA)—from a pilot program to a permanent
schedule.The Commission in Order No.30267,Case No.IPC-E-04-15.approved
implementation of a three-year FCA pilot program applicable to residential and small general
service customers.In October 2009,the Company filed an application seeking to convert the
pilot program to a permanent program.The Commission denied the Company’s request and
instead extended the pilot program for an additional two-year period.Order No.31063.The
FCA pilot program is set to expire on December 31,2011.
YOU ARE FURTHER NOTIFIED that the FCA purports to remove recovery of a
portion of the Company’s fixed costs from its energy sales.To accomplish this,the average
number of customers in the residential and small general service classes is multiplied by the
fixed-cost per customer rate (FCC),which is established as part of determining the Company’s
revenue requirement in a general rate case.The product of the calculation of the average number
of customers and the FCC establishes the allowed fixed costs recovery amount.The allowed
fixed-cost recovery amount is then compared to the amount of fixed cost actually recovered by
Idaho Power.The actual fixed costs recovered is determined by the Company’s weather-
normalized sales for each class multiplied by sales figures by the fixed-cost per energy rate
(FCE),which is also established in a general rate case.The difference between the allowed
fixed-cost recovery amount and the actual fixed costs recovered is the amount recovered for each
class by adjusting the FCA.
NOTICE OF APPLICATION
NOTICE OF ENTERVENTION DEADLINE
ORDER NO.32389 1
YOU ARE FURTHER NOTIFIED that the Application states that the purpose of the
pilot program was to test the FCA mechanism to determine 1ts efficacy in removing the
unintended rate design disincentive for the Company to aggressively pursue DSM programs.”
Application,p.5.The Company contends the first four years of the pilot program indicate that
the FCA mechanism is working as intended and operates to mitigate the adverse affects of
energy efficiency by ensuring that the fixed costs authorized by the Commission for recovery are
being recovered through the FCA mechanism.Id.The Company proposes to make the program
permanent for the residential and small general service customer classes,and proposes to true-up
the FCA by combining the deferral balances of each class and implementing rates for each class
that represent a uniform percent change.Idaho Power asserts that by combining the residential
and small general service FCA balances and determining the rate adders based on an equal FCA
rate adjustment for each class,the overall rate impact to customers in these classes is more
representative of the total amount of the required fixed-cost recovery for each class.Application,
pp.5-6.
YOU ARE FURTHER NOTIFIED that Idaho Power asserts in its Application that
making the FCA permanent removes the Company’s financial disincentive to acquire demand-
side management (DSM)resources:“Severing the link between energy sales and the recovery of
fixed costs represents a logical evolution of historic ratemaking practices,an evolution that
allows Idaho Power to pursue both programmatic and non-programmatic DSM initiatives
without running the risk of financially harming its shareholders”Application,p.4.Idaho
Power contends that making the FCA permanent “sends the appropriate signal to Idaho Power
that this Commission believes the Company continues to be on the right track in its pursuit of
DSM resources.”Id.
YOU ARE FURTHER NOTIFIED that Idaho Power is also proposing to eliminate
the annual reports required by the pilot program showing the specific ways in which the
Company increased its investment in energy efficiency and DSM programs.The Company
proposes to eliminate the separate annual reporting requirement because the Company’s
acquisition of energy efficiency and DSM programs are reported in the Company’s annual DSM
reports.The Company would continue monthly reporting of the FCA balance and to file animal
applications seeking approval of FCA true-up balances.The Company requests that the
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO.32389 2
Commission issue an Order no later than March 30,2012,making the Schedule 54 FCA program
permanent effective January 1,2012.
YOU ARE FURTHER NOTIFIED that the Application and supporting workpapers,
testimonies and exhibits have been filed with the Commission and are available for public
inspection during regular business hours at the Commission offices.The Application and
testimonies are also available on the Commission’s web site at www.puc.idaho.gov by clicking
on File Room”and then “Electric Cases.”
YOU ARE FURTHER NOTIFIED that all proceedings in this case will be held
pursuant to the Commission’s jurisdiction under Title 61 of the Idaho Code and specifically
Idaho Code §61-501,61-502,and 61-503.The Commission may enter any final Order
consistent with its authority under Title 61.
YOU ARE FURTHER NOTIFIED that all proceedings in this matter will be
conducted pursuant to the Commission’s Rules of Procedure,IDAPA 31.01.01.000 et seq.
NOTICE OF INTERVENTiON DEADLINE
YOU ARE FURTHER NOTIFIED that persons desiring to intervene in this matter
for the purpose of presenting evidence or cross-examining witnesses at hearing must file a
Petition to Intervene with the Commission pursuant to this Commission’s Rules of Procedure
72 and 73,IDAPA 3 1.01.01.072 and -.073.Persons intending to participate at the hearing must
file a Petition to Intervene 14 days from the service date of this Order.Persons desiring to
present their views without parties’rights of participation and cross-examination are not required
to intervene and may present their comments without prior notification to the Commission or the
parties.
YOU ARE FURTHER NOTIFIED that once the deadline for intervention has
passed,the Commission Secretary will prepare and distribute a Notice of Parties.The
Commission anticipates that the parties will subsequently convene an informal prehearing
conference to determine the scheduling of discovery,testimony,technical hearings,and other
matters.The Notice of Parties shall also assign exhibit numbers to each party in this proceeding.
YOU ARE FURTHER NOTIFIED that the following persons are designated as
Idaho Power’s representatives in this matter:
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO.32389 3
Jason B.Williams Michael J.Youngblood
Lisa D.Nordstrom Zachary L.Harris
Idaho Power Company Idaho Power Company
P0 Box 70 P0 Box 70
Boise.ID 83707-0070 Boise,Idaho 83707-0070
E-mail:[e-mail] E-mail:myoungblood(Iidahopower.com
lnordstromiidahopower.corn zharrisuidahopower.com
YOU ARE FURTHER NOTIFIED that all hearings and prehearing conferences in
this matter will be held in facilities meeting the accessibility requirements of the Americans with
Disabilities Act (ADA).Persons needing the help of a sign language interpreter or other
assistance in order to participate in or to understand testimony and argument at a public hearing
may ask the Commission to provide a sign language interpreter or other assistance at the hearing.
The request for assistance must be received at least five (5)working days before the hearing by
contacting the Commission Secretary at:
IDAHO PUBLIC UTILITIES COMMISSION
P0 BOX 83720
BOISE,IDAHO 83720-0074
[phone] (Telephone)
[phone] (FAX)
E-Mail:secretary/apuc
.i daho.gov
ORDER
IT IS HEREBY ORDERED that persons desiring to intervene in this matter shall file
a Petition to Intervene within 14 days from the service date of this Order.
NOTICE OF APPL1CATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO.32389 4
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this ‘‘.‘(__
day of November 2011.
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MXRSHA H.SMITH,COMMISSIONER
NOTICE OF APPLICATION
NOTICE OF INTERVENTION DEADLINE
ORDER NO.32389
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