20120229final_order_no_32473.pdf

Office of the Secretary
Service Date
February 29,2012
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION )
OF IDAHO POWER COMPANY FOR )CASE NO.IPC-E-12-03
AUTHORITY TO MODIFY AND UPDATE )
ITS RULE H TARIFF.)ORDER NO.32473
______________________________________________________________________________________
)
On December 29,2011.Idaho Power Company filed its annual compliance filing to
update charges and credits under Rule H,New Service Attachments and Distribution Line
Installations or Alterations.The Company filed this as a Tariff Advice o.11-05 and requested
approval by March 1,2012,so the updates could be effective March 15,2012.’After reviewing
the filing,Staff recommended that the Commission process the tariff advice through the use of
Modified Procedure because it appeared that some of the changes go beyond the usual ‘updates”
of charges and credits contemplated by Commission Order Nos.30853 and 30955.
On January 18.2012,the Commission issued a Notice of Application/Notice of
Modified Procedure and established comment deadlines.Order No.32439.Staff was the only
person or party to file comments.Based on the record established in this case,the Commission
approves Idaho Power’s Application to modify and update its Rule H tariff as set out in greater
detail in the body of this Order.
THE APPLICATION
The Company proposes cost updates to the charges and credits outlined in Rule H,
New Service Attachments and Distribution Line Installations or Alterations.This is the annual
compliance filing to update Rule H charges and credits as required by Commission Order Nos.
30853 and 30955.In addition.the Company is proposing to remove metering costs from the
calculation of single-phase and three-phase allowances.The Company claims that metering
costs are not charged on Rule H work orders and,therefore,such costs are not appropriate when
calculating Company-funded allowances.
The Company is also proposing to add a new charge to the Other Charges section of
Rule I-I.The Company claims that the new,flat charge (Overhead Service Attachment Charge
for Non-Residence)would reduce overhead costs by eliminating the need for individual work
The Company is requesting a 14-day implementation period to update computer systems and prepare newcommunicationmaterials.
ORDER NO.32473 1
orders each time a request is made for overhead service attachments for non-residences.Finally,
the Company is proposing minor “housekeeping”edits to the tariff.
COMMENTS
Idaho Power proposes to exclude metering costs from the single-phase and three-
phase allowances because they are not included in work order cost estimates.Metering costs
include both the cost of the meter as well as the labor involved in installing the meter.
Historically,no customers have been charged metering costs as part of an upfront work order
cost.Metering costs have been recovered through base rates charged to all customers.
Consequently,Staff agrees that it is appropriate to exclude metering costs in computing single-
and three-phase allowance amounts.To reflect the change,Staff recommended that the
Company delete the phrase “cost of new meter only”from the maximum allowance per service
for residential non-residences and replace it with “$0.00”to be consistent with the calculation of
allowances for the other residential schedules.
The Company is also proposing to implement a flat charge for overhead services to
non-residence structures.Currently,the charge is based on work order costs specific to each
individual service attachment request.The Company claims that “costs associated with these
service attachment requests rarely vary between customers,and therefore,a flat charge is
appropriate”and this new charge will “reduce overhead costs for the Company.”
In order to determine the extent that costs may vary between customers,Staff
requested the actual costs for each non-residence overhead service attachment completed in the
past year.The Company provided a random sample of ten work orders for overhead service
attachments to non-residences.Staff’s analysis revealed that the most expensive work order was
roughly double the cost of the least expensive work order ($229.36 and $115.34,respectively).
Had the proposed flat charge of $181 been in effect,40%of customers would have paid more
than their actual work order costs and 60%of customers would have paid less than their actual
work order costs.Therefore,40%of customers would have subsidized the attachment costs for
the remaining 60%of customers.Staff maintains that these subsidies are not insignificant.As a
result,Staff recommended that the Commission deny the Company’s proposal to add a new,flat
rate Overhead Service Attachment Charge for Non-Residences.
In addition to minor “housekeeping”edits to the tariff (as contemplated by
Commission Order Nos.30853 and 30955),the Company proposed to (1)correct the definition
ORDER NO.32473 2
of terminal facilities to indicate that underground service wire is not included and (2)add in a
new defined term,connected load,to clarify the calculation of vested interest charges.The
Company also proposed to add Schedule 3 to the preamble of Rule H.Schedule 3 covers master-
metered mobile home park residential service and,in Staffs opinion,should have been included
in Rule H previously because work done for this schedule appropriately falls under Rule H.
Staff does not oppose these proposed changes.
In responding to audit requests from the Staff the Company found errors in four of
the six distance charges for underground service attachments.The Company calculated the
charges for 125 feet of cable instead of 100 feet of cable as specified in the tariff.Thus,the
Company proposed charges that were calculated incorrectly.Staff recommended that the
Company be directed to resubmit its proposal with the correct charges.
FINDINGS AND CONCLUSIONS
Idaho Power is a public utility pursuant to Idaho Code §61-119 and 61-129.The
Commission has jurisdiction over this matter pursuant to Title 61 of the Idaho Code and the
Commission’s Rules of Procedure,IDAPA 3 1.01.01.000 et seq.Based on our review of the
Company’s Application and the comments of Commission Staff,we find that it is just and
reasonable to allow Idaho Power to modify and update charges and credits under its Rule H
tariff.
Specifically,we find that removing metering costs from single-and three-phase
allowance amounts is appropriate because metering costs are not included in work order cost
estimates.We direct Idaho Power to delete the phrase “cost of new meter only”from Maximum
Allowance per Service for Residential Non-residences and replace it with “$0.00.”
We find that,at this time,Idaho Power’s proposal to implement a new,flat charge for
overhead services to non-residences is not justified.Initially,the Company maintained that costs
associated with these service attachments rarely vary between customers and that a flat charge
would reduce overhead costs for the Company.However,Staffs analysis revealed large
variations in the cost of service attachments between customers.The Company also affirmed,
upon further investigation,that general overhead costs would not be reduced by the
implementation of a flat charge as originally indicated.Consequently,we find it just and
reasonable to direct the Company to continue to charge customers their actual work order costs
regarding requests for overhead service attachments.We encourage Idaho Power to renew its
ORDER NO.32473 3
request for a new,flat charge for overhead services to non-residences when it is able to provide
adequate support and data to justify the proposal.
In responding to audit requests by Staff the Company discovered errors in four
distance charges calculated for underground service attachments.Idaho Power calculated the
charges based on 125 feet of cable instead of 100 feet of cable,as specified in the Rule H tariff.
We direct the Company to correct these calculation errors prior to submitting its conformed
tariff.The Commission finds that the remaining language and housekeeping changes to Idaho
Power’s Rule H tariff are just and reasonable and consistent with our directives in Order Nos.
30853 and 30955.
ORDER
IT IS HEREBY ORDERED that the Application of Idaho Power for authority to
modify and update charges and credits under its Rule H tariff is approved,as set out in greater
detail in the body of this Order.Changes shall be effective March 15,2012.
IT IS FURTHER ORDERED that Idaho Power file conforming tariffs no later than
March 9,2012.
THIS IS A FINAL ORDER.Any person interested in this Order may petition for
reconsideration within twenty-one (21)days of the service date of this Order.Within seven (7)
days after any person has petitioned for reconsideration,any other person may cross-petition for
reconsideration.See Idaho Code §61-626.
ORDER NO.32473 4
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this Z
day of February 2012.
PAUL KJELL R,PRESIDENT
.
4•
.
MACK A.REDFORICOMMISSIONER
ATTEST:
(N.,?
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J&n D.Jewel(’!
2bmmission cretary
O:IPC-E-1 2-03ks2
Out of the Office on this Date
MARSHA H.SMITH,COMMISSIONER
ORDER NO.32473 5