20120416Petition for Reconsideration.pdf

Benjamin J. Otto ISB No. 8292 RECEIVED
710 N 6th Street
Boise, ID 83701 2012 APR 16 AM 11: 41
Ph: [phone] x 12
Fax: [phone] IDAHO PULi..
[e-mail] UTILITIES' COMMISSION
Attorney for Idaho Conservation League
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MAR OF THE
APPLICATION OF IDAHO POWER
COMPANY FOR AUTHORITY TO
CONVERT SCHEDULE 54-FIXED COST
ADJUSTMENT-FROM A PILOT
SCHEDULE TO AN ONGOING,
PERMANENT SCHEDULE
)
CASE NO. IPC-E-11-19
PETITION FOR
RECONSIDERATION
)
COMES NOW, the Idaho Conservation League ("ICL"), pursuant to I.C. § 61-626 and IDAPA
31.01.01.331 - 332 with the following Petition for Reconsideration. The Commission, in Order
32505, denied in part ICL's application for intevenor funding. ICL respectfully asks the
Commission to reconsider this final Order. Below, ICL sets forth the grounds for this petition
and the arguments to support our position. Accordingly, ICL does not request any further hearing
or briefing on this matter. See IDAPA 31.01.01.33 1.02.
I. Grounds for Reconsideration
Idaho Code empowers the Commission to award intervention costs "tø encourage
participation at all stages of all proceedings. . . so that all affected customers receive full and fair
representation in those proceedings." I.C. § 61-617A. According to the Idaho Supreme Court:
"It is the express policy of the statute to encourage participation in by [sic] intervenors by
awarding all or a portion of the costs of intervention." Idaho Fair Share v. Idaho Public Utilities
Comm'n, 113 Idaho 959, 963, 751 P.2d 107, 110 (1988) (overruled on other grounds byJ.R.
Simplot Co. Inc. v. Idaho State Tax Comm'n, 120 Idaho 849, 862, 820 P.2d 1206, 1219 (1991)).
The statute provides the Commission discretion as to whether and to what extent to grant any
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IPC-E-1 1-19 April 16, 2012
award. I.C. § 61-617A. This discretion is reviewed for abuse. Building Contractors Ass'n of
Southwestern Idaho v. Idaho Public Utilities Comm'n, 151 Idaho 10, 253 P.3d 684, 691
(201 1)(BCA). Similar to the award of attorney fees under I.C. § 12-12 1, this review asks whether
the Commission: (1) "perceived the issue as one of discretion;" (2) "acted within the outer
boundaries of its discretion and consistently with the legal standards applicable to the specific
choices available to it;" and (3) "reached its decision by the exercise of reason." Bingham v.
Montane Resource Associates, 133 Idaho 420, 427, 987 P.2d 1035, 1042 (1999).
ICL respectfully asks the Commission to reconsider the exercise of discretion in this case.
While the decision to award intervention costs is discretionary, the statute bounds this discretion
by four factors the Commission shall consider. I.C. § 61-617A; IDAPA 31.01.01.165; BCA, 253
P.3d 691. The Commission found ICL materially contributed to the decision and differed
materially from the testimony and exhibits of the Commission staff. Order 32505 at 8. ICL
explained in our application how we addressed issues of concern to the general body of ratepayers.
ICL Application at 3-4. Since the Commission granted a partial award ICL assumes this
explanation was satisfactory. However, the Commission found ICL's requested amount
unreasonable. Order 32505 at 8. ICL respectfully submits that important facts in this case, as
well as the legal standards applicable to this exercise of discretion, work against this finding.
Moreover, to the extent Order 32505 serves as precedent for future cost awards, ICL is concerned
it discourages potential future intervenors' ability to fully and fairly participate in all proceedings
before this Commission. Instead, ICL respectfully urges the Commission to uphold the stated
policy of Idaho "to encourage participation in all stages of all proceedings before the Commission"
by awarding larger portion of our request. I.C. § 61-617A.
II. Argument
In denying the majority of ICL's request, the Order provides two interrelated reasons. The
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IPC-E-1 1-19 April 16, 2012
Order emphasizes that I.C. § 61-617A limits awards to "legal fees, witness fees and reproduction
costs." Order 32505 at 7-8. The Order also states that a "case concluded by written comments
filed in Modified Procedure, following one meeting of the parties" should not incur as much costs
as ICL did. Id. ICL respectfully submits these statements leave out substantial and important
efforts that preceded this conclusion. As explained below, the Commission's rules require ICL to
be represented by an attorney in this proceeding. Further, based on the original Order in this case,
ICL expected a technical hearing and retained expert assistance to fully and fairly represent our
interests. This technical assistance directly influenced ICL's later acquiescence to Modified
Procedure and informed the comments the Commission found to contribute to the decision.
Based on the procedural history of this case, and the Commission's rules of procedure, ICL
reasonably incurred legal and witness fees. Accordingly, awarding a larger portion of our
intervention costs is consistent with the applicable legal standards and an exercise in reasoned
discretion. Bingham, 987 P.2d at 1042.
A. Legal Fees
While this case concluded through Modified Procedure, it began as a much different case.
On November 2, 2011, the Commission issued Order 32389 notifying the public of the
Application and establishing a deadline for intervention. This Order did not mention the
Modified Procedure rules; rather it stated "persons intending to participate at the hearing must file
a Petition to Intervene 14 days from the service date of the Order." Id at 3. Pursuant to this
Order ICL prepared to intervene and participate in the expected hearing. The Commission
granted ICL's Petition to Intervene on November 29, 2011. Order 32402.
The Commission's rules require ICI, a non-profit corporation under I.C. §§ 30-3-1 - 30-
3-134, to be represented by an attorney for any "petitions, motions, applications for modified
procedure or technical/evidentiary hearings." IDAPA 31.01.01.43.02. The rules define an
ICL Petition for Reconsideration 3
IPC-E-11-19 April 16, 2012
"intervention" as a "petition." IDAPA 31.01.01.053.05. During this stage of the proceedings,
ICL prepared for the technical hearing described in the Order by reviewing the prefiled testimony,
contracting with a technical expert, reviewing discovery, and researching the issues. On January
27, 2012, eleven weeks after the Order, the parties met to establish a case schedule. The parties
agreed to Modified Procedure, and the Commission adopted this recommendation on February
14, 2012. Order 32454. Assuming the Commission must issue an order to change the established
procedure, for the initial 15 weeks of this case the Commission's rules mandated that an attorney
represent ICL.
After the Commission adopted Modified Procedure, ICI, as an official party, elected to be
represented by an attorney, as the rules allow. IDAPA 31.01.01.43. This was reasonable since
both the PUC Staff and Idaho Power elected to continue to be represented by attorneys.
Attorney representation, combined with utilizing expert assistance discussed below, facilitated
ICI's full participation in all stages including submitting extensive comments that "materially
contributed to the Commission's decision [.1" Order 32505 at 8.
ICL respectfully submits the Commission exceeded its discretion by reducing ICI's award
to 7% of its request. Responding to ICUs request for funding, the Commission stated, "a case
concluded by written comments filed in a Modified Procedure, following one meeting of the
parties, should not reasonably result in a request for funding of $10,000." Order 32505 at 8. The
Commission then compared ICUs request to another party who choose to represent their interests
in a different manner. Id. But this reasoning does not consider that this case initially required
ICL to be represented by an attorney under Idaho law and this Commission's rules, which are legal
standards applicable to the exercise of discretion. Bingham, 987 P.2d at 1042. Further, the
Commission should focus on the quality of the information, rather than the procedural posture of
the case, when exercising the discretion to award intervention costs. Id. ICL respectfully urges the
Commission to reconsider the exercise of discretion in this case and award a greater portion our
ICL Petition for Reconsideration 4
IPC-E-11-19 April 16, 2012
fee request. By doing so the Commission will uphold "the policy of the state to encourage
participation at all stages of all proceedings. . . so that all affected customers receive full and fair
representation[.]" I.C. § 61-617A; Idaho Fair Share, 751 P.2d at 110.
B. Expert witness
ICL also reasonably incurred witnes fees to prepare for the hearing originally planned in
this case. Based on Order 32389 describing an expected technical hearing, ICL retained an expert
witness, Dr Carl Linvill, to assist in reviewing the case, developing our initial position on the
issues, and prepare for the hearing. On January 27, 2012, the parties meet to discuss the case.
While ICL cannot disclose the contents of this meeting, we note that several technical experts
from both the Staff and Idaho Power participated. ICL's ability to consult our expert at this stage
allowed us to effectively participate in this meeting and directly influenced our agreement to forgo
a hearing and recommend proceeding by Modified Procedure.
Once the Commission adopted Modified Procedure, we limited our expert witness
expenses because a technical hearing would not occur. But the expert assistance leading up to this
point, and our continued consultation, directly enhanced ICL's ability to fully and fairly
participate in this case. After the January 27' meeting, ICL met with several technical experts
from the PUC Staff and conferred with Idaho Power's expert Mr. Cavanagh to further discuss the
issues and possible resolutions. The PUC staff utilized five technical staff to inform their written
comments. Staff Comments at 12. Likewise, ICI's expert assistance heavily informed both our
initial and reply comments. Although the procedural posture of the case changed, ICL's initial
expense directly influenced our ability to participate in all stages of the case. ICL respectfully urges
the Commission to reconsider its exercise of discretion by considering the benefits of parties using
expert assistance to resolve the issues, rather than the final procedural posture of the case.
The Commission has awarded expert fees in other cases based on work preformed during
ICL Petition for Reconsideration 5
IPC-E-11-19 April 16, 2012
discovery and settlement and without the party filing substantive comments. See Order 32426 at
35, (awarding IIPA $12,891 for joining a stipulation after actively participating in discovery and
settlement phases); Order 32432 at 19-20 (awarding IIPA $18,000 because they "employed the
services of legal council as well as a ratemaking expert" who participated in discovery and
settlement phases); Order 32371 at 11-12 (awardingiCL $3,625 and CAPAI $10,885.16 fora
case resolved by settlement because their involvement "required the investment of considerable
time and resources to effectively participate. . ."). While these examples are general rate cases,
they are analogous to the present case. This case began on a procedural path headed towards an
evidentiary hearing. Order 32389. This case involved reviewing the testimony and discovery of
other parties, as well as participating in potential settlement discussions. And unlike the three
cases above, in this case ICL filed extensive written comments that stakeout a position opposite of
the Staff. In largely denying ICL's fee request, the Commission notes this case "concluded by
written comments filed in Modified Procedure[.]" Order 32505 at 8. To deny ICI's expert
assistance costs based on a change in procedure, and without considering the ongoing need for
technical expertise during all phases of the case, discourages full and fair participation at all stages
of all proceedings. I.C. § 61-617A.
C. Modified Procedure in General
Order 32505 appears to limit the availabiitr of intervenor funding in Modified Procedure
cases. This conflicts with the "very broadly worded declaration of policy" to encourage
participation "at all stages of all proceedings" and by using the discretion to grant awards in "any
proceeding before the Commission." Idaho Fair Share, 751 P.2d at 110. Despite this broad
wording, Order 32505 appears to limit intervenor awards in a class of proceedings by stating:
"Because Modified Procedure normally concludes without an evidentiary hearing, there are no
witnesses, and maybe no legal fees, to support an award of intervenor funding." Id. ICL urges
ICL Petition for Reconsideration 6
IPC-E-1 1-19 April 16, 2012
the Commission to reconsider this statement, since it conflicts with the statute and creates a
powerful incentive for parties to oppose Modified Procedure in all cases.
Order 32505 is confusing as to the standards the Commission will apply and the reasoning
they will undertake when exercising discretion to award intervenor funding. The Order describes
case IPC-E-08-23, wherein the Commission denied a request for intervenor funding in a case
consisting of informal meetings and telephone calls. Order 32505 at 8. Unlike the award
petitioner in IPC-E-08-23, ICL is a formal party to this case. More importantly, ICL appreciates
the need to have a record upon which to determine if intervenors materially contributed to the
decision and materially differed from staff. Modified Procedure can produce this record, as the
Commission found it did here. Id. Requiring a written record upon which to determine material
contribution and material difference is within the bounds of discretion. But to excise from the
reach of the intervenor funding statue Modified Procedure cases because they do not conclude
with an evidentiary hearing appears to be outside the bounds of discretion and inconsistent with
I.C. § 61-617A.
Often Modified Procedure cases require interested persons to understand complex
economic, engineering, and legal issues such as prudency reviews of Demand Side Management
spending, amortizing transmission costs pursuant to FERC orders, or modifying service and
performance reporting standards. See IPC-E-12-15; IPC-E-12-06; PAC-E-12-02. To fully and
effectively participate in these proceedings, including deciding whether to intervene or request a
hearing, interested persons must have the ability to retain expert legal and technical advice. Idaho
law encourages this ability by creating the possibility to recoup these costs based on certain
standards. Those standards are not based on the procedural posture of the case; rather they require
gaining intervention status, which requires legal representation, and materially contributing to the
Commission's decision, which often requires technical expertise. To the extent the reasoning in
Order 32505 relies on the procedural posture of this case, ICL respectfully asks the Commission to
ICL Petition for Reconsideration 7
IPC-E-1 1-19 April 16, 2012
reconsider this exercise of discretion. Bingham, 987 P.2d at 1042.
III. Conclusion
The Commission has the discretion to award all or a portion of an intervenor's legal and
witness fees. I.C. § 61-617A. A broadly worded statement of policy to "encourage participation
in all stages of all proceedings before the commission so that effected customers receive full and
fair representation in those proceedings" backs this power. Id.; Idaho Fair Share, 751 P.2d at 110.
Based on Order 32389 ICL incurred legal and witness fees to intervene and prepare for the
expected hearing. This expertise directly enhanced our ability to participate in all stages of this
proceeding, including meeting with the technical and legal experts of the other parties and filing
extensive written comments. This Commission found ICL materially contributed to the decision,
materially differed from the Staff, and addressed issues of concern to the general body of
ratepayers. Order 32505 at 8. In the past, the Commission has recognized that incurring these
fees is a financial hardship for a non-profit organization. Order 32371 at 12. However, here the
Commission found that 93% of ICL's costs were unreasonable based on a change in procedure
without considering the legal mandate that an attorney represent ICL and that access to technical
assistance enhanced the quality of information presented to the Commission. Order 32505 at 8.
ICL respectfully asks this Commission to reconsider this exercise of discretion and award a larger
portion of our costs.
DATED this 16th day of April 2012.
Respectfully submitted,
Benjamin J. Otto
Idaho Conservation League
ICL Petition for Reconsideration 8
1PC-E-1 1-19 April 16, 2012
EXHIBIT A
Expert Fees Carl Linviti PhD - $3000
Attorney Fees for Benjamin J. Otto - Total: $7,156.25
57.25 Hours at $125 per hour
10/31/11 Review application and initial testimony 1.5
11/16/11 Prepare application to intervene, File same .75
Meet with Linvill re possible expert assistance. Draft
12/5/11 contract re same 1.75
Compile case documents, research and data send to
12/9/11 Linvill .75
12/16/11 Review Staff production request to Idaho Power .25
Review Idaho Power responses to Staff production
1/16/12 request 1.5
1/16/12 Research options for decoupling mechanisms 4.5
1/17/12 Research options for decoupling mechanisms 5.25
1/24/12 Review Linvill evaluation of the case and proposals 2.5
Meet with Linvill to discuss evaluation and develop
1/26/12 ICL proposals 1.25
1/27/12 Meet with Parties re settlement 2.25
2/7/12 Draft comments 3.5
2/10/12 Meet with staff to discuss issues 1.5
2/27/12 Draft comments 3.25
2/29/12 Draft comments 3.75
3/1/12 Final draft of comments. File same 6
3/2/12 Review Staff comments .75
Research re staff comments and implications for
3/3/12 mechanism 2.5
3/8/12 Conference with Linvill re: reply comments .5
3/12/12 Draft reply comments 6
3/13/12 Draft reply comments 3.25
3/15/12 Final draft of reply comments. File same 2.5
3/20/12 Prepare application for intervenor funding 1.5
Total Hours 57.25
ICL Petition for Reconsideration 9
IPC-E-11- 19 April 16, 2012
CERTIFICATE OF iSERVICE
I hereby certify that on this 16th day of April 2012,1 delivered true and correct copies of
the foregoing PETITION FOR RECONSIDERATION OF THE IDAHO CONSERVATION
LEAGUE to the following via the method of service noted:
Hand delivery:
Jean Jewell
Commission Secretary (Original and seven copies provided)
Idaho Public Utilities Commission
427 W. Washington St.
Boise, ID 83702-5983
Electronic Mail:
Idaho Power
Jason B. Williams
Lisa D. Nordstrom
Idaho Power Company
1221 West Idaho Street
Boise, Idaho 83707-0070
jwilhiams @idahopower.com
[e-mail]
Michael J. Youngblood
Zachary L Harris
Idaho Power Company
P.O. Box 70
Boise, Idaho 83707
[e-mail]
[e-mail]
NWEC
Nancy Hirsh
NW Energy Coalition
811 1st Ave., Suite 305
Seattle, WA 98104
Ph: [phone]
[e-mail]
Micron
Richard E. Malmgren
Sr. Asst. General Counsel
Micron Technology, Inc.
800 South Federal Way
Boise. ID 83716
[e-mail]
Thorvald A. Nelson
Frederick J. Schmidt
Holland & Hart LLP
6800 South Fiddlers Green Circle, Ste. 500
Greenwood Village, CO 80111
[e-mail]
[e-mail]
Benjamin J. Otto
Certificate of Service
IPC-E-1 1-19 April 16, 2012