20140508Comments.pdf

KARL T. KLEIN
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720.007 4
[phone]
IDAHO BAR NO. 5156
Street Address for Express Mail:
472 W. WASHINGTON
BOISE, IDAHO 83702.59I8
Attorney for the Commission Staff
IN THE MATTER OF IDAHO POWER
COMPANY'S APPLICATION FOR
AUTHORITY TO IMPLEMENT FIXED COST
ADJUSTMENT RATES FOR SERVICE FROM
JUNE 1,2014 THROUGH MAY 31, 2015.
) !._t
BEFORE THE TDAHO PUBLIC UTILITIES COMMISSION
CASE NO. IPC.E.14.O3
COMMENTS OF THE
COMMISSION STAFF
The Staff of the Idaho Public Utilities Commission comments as follows on Idaho Power
Company's Application to implement Fixed Cost Adjustment (FCA) rates for electric service
effective June 1 ,2014 through May 31,2015.
I. BACKGROUND
On March 74,2ll4,Idaho Power Company (the "Company") applied to the Commission
for an order allowing the Company to increase its FCA rates for electric service provided from
June I ,2014 through May 3 1,2015. The FCA enables the Company to separate its fixed-cost
revenues from its volumetric energy sales. It lets the Company recover its fixed costs of
delivering energy-as established in its most recent general rate case-when energy sales and
revenue have decreased below prescribed per-customer levels. The FCA rates are identified in
tariff Schedule 54 and apply to the residential and small-general-service customer classes.
The FCA functions by first identifying an authorized fixed-cost recovery amount for the
residential and small-general-service customer classes. This amount is a product of the number
of customers in each class multiplied by the fixed-cost per customer rate, which is established as
STAFF COMMENTS MAY 8,2014
part of determining the Company's revenue requirement in its most recent general rate case. The
authorized recovery amount is then compared to the amount of fixed costs actually recovered by
the Company. The amount of fixed costs actually recovered is determined by multiplying the
weather-normalized sales for each class by the fixed-cost per energy rate, as established in the
Company's most recent rate case. The difference between the authorized fixed-cost recovery
amount and the actual fixed costs recovered results in an adjustment each year to the FCA rate.
With this Application, the Company says the 2013 FCA balance is $14,339,006 for the
residential class and $573,436 for the small-general-service class, for a total amount to be
recovered of $14,912,442. The proposed FCA deferral balance is an incremental increase above
the FCA balance currently collected in customers' rates. Accordingly, the Company proposes to
increase FCA rates by 1.17% for the residential class and 1.20% for the small-general-service
class, for an overall change of 1.1 8o/o. The increase equates to a new FCA rate of 0.2913 cents-
per-kWh for the residential class and 0.3709 cents-per-kWh for the small-general-service class.
II. STAFF ANALYSIS
Staff reviewed the Company's filing and supporting testimony from Company witness
Harris, and verified that the Company used Commission-approved methodology to calculate the
FCA deferral balance. Staff found that the Company's sales per customer for residential and
small-general classes were lower in2013 than in 2012. As a result, the Company's weather-
normalized sales were insufficient to allow the Company to collect its authorized fixed costs.
To allow the Company to collect its under-recovered fixed costs, the Commission should
increase the Company's rates by about $15 million for the 2014 PCA year. However, while Staff
believes the Company should receive the requested increase in this case, Staff also believes: (a)
the FCA methodology is flawed; and (b) the FCA no longer has its intended effect of
encouraging the Company to invest in energy efficiency. Staff thus recommends that the
Commission open a separate docket to reevaluate the FCA. These issues are further summarized
below.
A. Flaws in the FCA Mechanism
Staff evaluated the FCA following its second year of permanent status and maintains that
the mechanism has the following fundamental flaws:
STAFF COMMENTS MAY 8.2014
l) Weather Normalization Adjustment- Staff believes adjusting downward above normal
energy sales due to weather results in an over recovery of fixed costs through the FCA.
2) Customer Count Methodology- Staff believes it is more appropriate to use a median
customer count rather than an average customer count for the FCA calculation. Staff also
believes the Company should report the number of customers switching from Schedules 7
and 9 and their energy use so Staff can determine how they impact the FCA calculation.
3) Calculation of the 30% Rate Adjustment Cap- Staff believes the calculation of the cap
should be reevaluated and possibly changed given the layering effect of the FCA between
rate cases, and that the basis for measuring rate impacts should be reevaluated.
4) Cross Subsidization Issue- Staff believes the cross-subsidization of other classes by
residential and small-general-service customers in the calculation of the Fixed Cost per
Customer rate (FCC) and Fixed Cost per Energy rate (FCE) should be reassessed.
These fundamental flaws are further discussed below.
l. Weather Normalization Adjustment
Staff evaluated how the weather-normalization adjustment is used in the FCA. In
summary, if sales increases are attributed to above-average weather, sales are adjusted downward
to reflect "normal sales;" the converse is true for weather-related below-normal sales. As a
result, the FCA does not acknowledge the fixed costs that the Company actually collected when
sales are above-normal due to weather.l Although the Commission designed the weather
adjustment to be symmetrical, Staff now believes the Company signif,rcantly over collects
authorized fixed costs when sales are above-normal due to weather.
The Company's last cost-of-service study shows that the Company collects about 90o/, of
its fixed costs for residential customers through energy rates. For each kWh adjusted downward,
the Company recovers nearly double the associated fixed costs when weather contributes to
higher-than-normal energy sales. Similarly, the Company collects about 85% of its fixed costs
for small-general-service customers through energy rates. The Commission implemented the
FCA true-up mechanism because it "assures a more stable utility recovery of fixed costs that are
now recovered in the energy rate component of residential and small-general-service customers."
I Essentially, weather normalization in the FCA reallocates weather risk, measured in lost fixed margin, between the
Company and customers. With weather normalization, customers are exposed and pay more in above-average
years, and without weather normalization customers are exposed and pay more in below-average weather years.
STAFF COMMENTS MAY 8,2014
Order No. 30267. But the current FCA does more than assure stable recovery of fixed costs; it
ignores fixed-cost over recovery during the FCA timeframe when weather increases energy
sales. Fixed costs are fully collected in base rates throughout the year, and then recovered again
through the FCA by weather normalizing downward the actual sales.
This year's weather adjustment is substantial, totaling about $15,840,756 in fixed-cost
recovery from the residential class and $253,804 from the small-general-service class. The
weather adjustment is larger than the deferral balance itself. If the FCA was not weather
normalized, it would result in a credit of $ 1,047,317 million this year.2 The only year with a
weather adjustment comparable to the current one was in 2009, when the adjustment for
residential customers was about 97,313,829 in fixed-cost recovery. Historically, there have only
been two years in the last seven where the residential weather adjustment reflected that the
Company sold less energy than it would have sold under normal conditions; otherwise, actual
sales have been adjusted downward because the Company sold more energy than it would have
sold under normal conditions. Similarly, there has only been one year where the small-general-
service weather adjustment reflected that the Company sold less energy than it would have under
normal conditions. In the last seven years, the weather adjustment has approximately provided
the Company with $27,568,348 in net actual fixed-cost recovery from the FCA calculation.
Staff believes the Commission should reevaluate the weather adjustment to determine if
the Company over recovers its fixed costs when weather causes energy usage to be higher than
normal and, if so, whether that over recovery is consistent with the Commission's intent when it
approved the FCA mechanism. Staff acknowledges that the Company would have had even
greater found fixed margin without demand-side management (DSM). But the lost fixed margin
associated with Company DSM in a given year can and has been dwarfed by the impact of the
weather adjustment this year.
' This does not include the impact of monthly interest that may be accrued.
STAFF COMMENTS MAY 8,2074
2, Customer Count Methodologlt
The Company implemented its new billing system during the FCA period and had to
modify how it calculates its prorated customer count.3 Specifically, in August 2013, the
Company started using a customer count based on the average number of active meters at the end
of each month. Before August, the Company determined the customer count like it did in prior
years: the customer count was prorated based on revenue attributable to the Service Charge. The
proration methodology based on the Service Charge revenue has been used in the past because it
includes customers that have only been billed for a partial month. Although the Company's new
methodology does not separately track the revenue associated with the Minimum Charge and the
Service Charge, the Company applies a ratio to the month-end count to adjust the customer
count. Staff reviewed the accuracy and impact of the ratio, and found it to be comparable to the
prorated customer count based on the Service Charge revenue. The adjustment appears to
acknowledge customers that have a partial month of service.
Staff supports the Company's methodoloBy for calculating the monthly customer count.
But another issue exists. Staff analyzed the historical number of customers at the end of each
month from 2009-2013 and confirmed the variations between the months make the average
customer count a poor indicator of actual customers. Due to residential customer growth, the
Company is adding customers over the year. This causes the average to be skewed, or overstate
the "typical" number of customers in a month. Under these circumstances, the median, or
midpoint, is a more accurate representation of customers given the distribution of monthly
customer counts.4 Consequently, it is more appropriate to use median customers in the
calculation of allowed fixed costs.
In 2013, if the Company would have used the median instead of the mean, there would
have been about 529 fewer customers. Because the Company's approved revenue is based on
number of customers (FCC x Customer Count), using the median instead of the mean would
have reduced the FCA balance by about $330,430. When looking at both customer classes
historically, from 2007-2013, using the median instead of the mean would have reduced the FCA
3 The prorated customer counts form the basis for authorized fixed revenues in the FCA.
a Most economic analysis models study data for skewness and incorporate this into their calculations. Skewness risk
is the risk that a model assumes a normal distribution of data when in fact data is skewed to the left or right of the
mean, or average.
STAFF COMMENTS MAY 8,2014
balance by about $441,185. Staff believes that going forward, the Company should use median
number of customers at the end of each month.
Staff also believes the Company should monitor trends in the number of Schedule 7
customers moving to Schedule 9. In 2005, the Company changed the rate structure of Schedule
7. As a result, the Company anticipated about 20oZ of customers would switch to Schedule 9.
Before implementing its new billing system, the Company did not separately track customers
who switched schedules. Staff analyzed the historical trends of Schedule 7 customers migrating
to Schedule 9 and found that Schedule 7 customers have continued migrating to Schedule 9.
These customers are high-energy users compared to the small-general-service class as a whole,
making it appear as though Schedule 7 customers are conserving energy and artificially lowering
use-per-customer. Staff thus believes the Company is receiving credit through the FCA simply
because higher-usage Schedule 7 customers have moved to Schedule 9. To ensure that the
Company is properly calculating lost fixed costs, Staff believes that the migration between
Schedules 7 and 9 should be factored into the FCA.
3. FCA Rate Changes and the 3% Cap
In Commission Order No. 30267, the Commission states: the "FCA mechanism also
incorporates a3o/o cap on annual increases with carryover of unrecovered deferred costs to
subsequent years." The Commission, in its discretion and judgment, can impose the cap or let
the rate change to avoid deferring recovery to the following year. Staff notes that the basis for
the cap on rate changes has not been clearly defined, which has led to subjectivity in application.
Staff believes that before the next FCA, the term "annual increases" should be clarified so it
describes how the cap should apply to the FCA calculation.
The Company says the proposed increase of about $6 million in FCA collections is a
l.l8% increase from current billed rates. Harris, DI, p. 10. If so, the base for calculating the
percentage rate change is about $510 million ($6 million divided by I .1 8%), which reflects all
billed revenues, including base revenues and PCA revenues for the upcoming forecasted PCA
year, and embedded FCA revenues. In other words, rate changes and caps are calculated using
forecasted sales and revenues, which understates the magnitude of the rate change effect on
customers and increases the absolute dollar amount represented by the 3Yo cap on a yearly basis.
Through discovery, Staff learned that the Company calculates the 3Yo cap in a similar
fashion. The cap is calculated by taking 3Yo of the base revenue using the updated billing
STAFF COMMENTS MAY 8,2014
components from the PCA filing plus the change in FCA revenues. Based on the Company's
methodology, Staff calculated that this year's change in FCA deferral would have to be $13.5
million to reach the cap, or an additional $7.5 million above the Company's request.
Staff believes the methodology for quantifying rate changes and calculating the cap
should be revisited, particularly given the cumulative impact of several FCA increases between
rate cases. Staff questions whether it is appropriate to use forecasted billing determinants in the
FCA for anything beyond calculating the FCA rates to collect the defenal balance. FCA rate
changes and caps that incorporate revenue growth from projected sales create a layering effect
that dilutes the usefulness of the 3Yo cap. The cap has increased by nearly $1 million (7%) since
the last general rate case. Furthermore, the Company has collected about $24 million, or 6%o
more total revenue through the FCA than what was approved to be collected in the last general
rate case.s The deferral balances continue to grow, even in post rate case years such as 2012,
when the balance should have been close to zero because the FCC and FCE were reset in
January.
4. Cross-S ubsidization
Since the FCA was established, one of the fundamental goals has been to make sure
cross-subsidies are minimized across rate classes. Order No. 30267, p. 6. However, Staff
believes the residential and small commercial customers continue to subsidize the other
schedules given the methodology used for calculating the FCC and FCE.
During a general rate case, a cost-of-service study is performed to guide allocations of
revenue responsibility among classes. If rates are designed to collect full class cost-of-service,
no interclass subsidies exist. That has not been the case since the advent of the FCA, as
residential customers have covered a portion of fixed costs associated with other classes.
Consequently, the FCC and FCE calculations include a "Weighted Average Fixed Cost oZ of
Short-Fall," which is a ratio used to incorporate the fixed-cost revenue shonfall (parity ratios <
1.00) of all the other rate classes. Staff reviewed prior FCC and FCE calculations and found
about 3.4Yo of the Company's allowable fixed-cost recovery for residential customers was to
subsidize the shortfall from the other customer classes, which currently totals over $8 million.
5 Calculated based on the approved and proposed FCA deferral balances since the last general rate case,
IPC-E-l l-08. Total revenue for the residential and small-general-service customer classes.
STAFF COMMENTS MAY 8,2014
The interclass subsidy is increased beyond that built into rate design through the FCA because
part of the deferral balance is used to collect non-residential or small-general-service fixed costs.
Staff believes the FCC and FCE methodology may be inequitable, and that it should be
reevaluated to see if a more equitable methodology can be developed given the various cost-of-
service results.
B. The FCA No Longer Has the Intended Effect
The FCA was originally implemented to remove "a Company-identified financial
disincentive to energy efficiency and DSM investment."6 Although Staff and the Commission
were concerned that the FCA reimbursed the Company for reduced sales that were not driven by
its DSM programs, the intent of the mechanism appeared to be working. When the disincentive
was originally removed, the Company's annual energy savings grew rapidly. During the initial
pilot phase, the FCA produced a credit for customers in the first year, and surcharges ranged
from about $2.6 to $6 million.
The situation has changed considerably in subsequent years. The Company's energy
savings peaked in 2010, declined in the two ensuing years, and dramatically dropped off in 2013.
Meanwhile, the FCA balance has substantially increased. The blended FCA balance nearly
doubled-from $8.9 million in2012 to $15 million in 2013-while concurrently the Company's
year-over-year energy savings fell by 42yo.7
The figure below, reproduced from page 5 of the Company's DSM 2013 Annual Report,
shows that2013 energy savings are only somewhat higher than its 2007 savings, the first year of
the FCA. That demonstrates that the ever-escalating FCA balances are no longer driven by the
Company's willingness or ability to acquire energy savings. The FCA mechanism has
effectively severed the link between the Company's sales and revenue but the Company has not
maintained its enhanced commitment to energy efficiency. Staff points out that neither Avista
nor Rocky Mountain has a decoupling mechanism, and both utilities have maintained healthy
and stable energy savings for years.
6Case No. IPC-E-04-15, OrderNo. 30267,page 13.
'Idaho Power's DSM 2013 Annual Report, page l.
STAFF COMMENTS MAY 8,20t4
r Market Transformation (NEEA) (MWh)
r ldaho Power Program Savings (MV/h)
150,000
2007 2010 2011 2012 n13*
Figure 2. Annual energy savings, 2A02-2013 (lvlVVh)
'ln 2013, two ol the three demand response programs were temporarily suspended.
Note: 2013 market-lranslormation savirgs (Northwest Energy Effrienry Alliance [NEEAD are preliminary.
Following recent reductions in energy-efficiency expenditures and savings, the Company
identifies $20 million of current-and-forecasted surplus energy-efficiency tariff rider funds. The
Company proposes to refund this surplus through the annual Power Cost Adjustment.s The 2014
forecasted rider expenses-which are in line with the 2013 expenditure that produced the lowest
savings in six years-indicate that the Company does not expect material improvement from its
programs in the near future. Substantial and ongoing reductions in energy efficiency
demonstrate that the FCA has not corrected the Company-identified throughput problem as
intended.
1. Elfect of lower avoided-costs on residential energt efficiency
The Company's DSM 2013 Annual Reports states: "The energy savings in2013 for the
residential sector decreased by 28 percent..."e Idaho Power says this decrease is caused partially
8 Case No. IPC-E-14-05.
'Idaho Power's DSM 2013 Annual Report, page 10,
STAFF COMMENTS
BE
6
CDc'too
ctt
otr
IJJ
;
2008
MAY 8,2014
by reduced deemed saving from the Regional Technical Forum (RTF).t0 Falling avoided costs
are another factor that will tend to decrease residential savings in the future.
Residential programs are typically less cost-effective than commercial or industrial
programs because the per-unit savings are smaller and the overhead costs associated with
marketing to more customers and processing more individual rebates is greater. With the
Commission acknowledgement of the 2013 IRP, the Company will begin using the approximate
40Yo reduction in avoided costs from the 2013 IRP to analyze its 2014 programs. Preliminary
analysis conducted by the Company and presented to the Energy Efficiency Advisory Committee
(EEAG) indicates that, using 2072 savrngs, four of the nine residential programs will not be cost
effective under the new avoided costs from the total resource cost (TRC ) perspective.ll Because
2013 savings are significantly lower and not anticipated to dramatically rebound in future years,
cost-effectiveness will likely be worse than the preliminary forecast. Fewer cost-effective
residential programs will reduce residential energy savings, diminishing the impact of energy
efficiency on per-customer consumption.
Although some of its current programs may not be cost-effective in the future, the
Company has options for replacing those savings with new residential programs. For example,
the Company is the only regulated electric utility in Idaho that has not expanded its residential
portfolio to include a cost-effective residential behavior-based program. Despite its investment
in Advanced Metering Infrastructure (AMI), the Company has not significantly expanded rate
structures designed to promote energy efficiency since the advent of tiered rates in 2008. The
Company also does not evaluate potential energy savings from alternative pricing structures in
the Integrated Resource Planning (IRP) process. Without action, the Company's residential
energy savings will continue to decline whether the FCA is in place or not.
2. Use-per-customer forecast and symmetry
FCA supporters have long applauded its symmetry regarding credits and surcharges to
customers. When use-per-customer decreases, customers pay a surcharge to cover the
Company's unrecovered fixed costs. Conversely, when use-per-customer increases, customers
receive a credit because the Company's fixed costs have already been recovered through energy
'o Idaho Power's DSM 2013 Annual Report, page 10.rr This count excludes the Company's two low-income programs.
STAFF COMMENTS l0 MAY 8,2014
charges. Functional symmetry thus depends on the assumption that use-per-customer will
fluctuate in both directions. Seven years of FCA experience conclusively shows that this
assumption is false. Customers have paid surcharges in six of the seven FCA years. Further, the
Company's Conservation Potential Assessment (CPA) anticipates an ongoing 0.3% annual
decline in residential use per customer before any incremental utility energy efficiency savings,
totaling a 5Yo overall decline over the twenty-year planning period.12
The Company's 2013 IRP reached a similar conclusion. The graph below, reproduced
from the IRP, forecasts continued decline in weather-normalized residential use-per-customer.13
The graph shows that yearly use-per-customer has been declining by nearly 0.75% on average
since 1980. The year-to-year decline in residential use-per-customer cannot be attributed to the
Company's DSM efforts. New energy efficiency only affects the use-per-customer in the year
those measures are installed-after the first year, the use-per-customer would remain stable at
the lower
customer
20.000
level, but it would not decrease further without additional DSM. With use-per-
only forecasted to decreaseo the FCA will not produce functional symmetry.
18,000
16,000
r4,000
r2,000
10 000
8,000
6,000
4,000
2,000
0
l
l
1982 1S87 19S2 1S97 2@2
lActual
2047 2012 2017 2022 2027 2432
IForecasl
Flgure 5. Forecast residential use per customer (weather-adjusted kwh)
The growing penetration of natural gas space heating is a primary driver to declining
residential use-per-customer. Residential new construction primarily consists of natural gas heat
12 EnerNoc Utility Solutions, February 15,2Ol3,Idaho Power Energy Efficiency Potential Study, page 4-3.
'' Idaho Power Integrated Resource Plan, Appendix A: Sales and Load Forecast. June 2013, page 16. The IRP
performs separate analyses to account for future DSM savings. These results are incorporated in the IRP
independent ofthe sales and load forecast.
l1STAFF COMMENTS MAY 8,2074
(where available), and conversions from electric to gas heat have become more cost-effective as
gas customer rates remain low and electric customer rates continue to rise. Other significant
factors contributing to declining use-per-customer are more stringent lighting standards and
building codes. Except for its financial contributions to the Northwest Energy Efficiency
Alliance (NEEA), the Company has not strongly supported more stringent standards and codes.
Use-per-customer is a function of the rate at which customer counts grow in relation to
class energy sales, driving the FCA balance. FCA balances grow when customer counts increase
relative to energy sales (resulting in declining use-per-customer). Again, the IRP forecasts
conditions that predict on-going FCA surcharges. The IRP anticipates that the Company will
gain 139,000 new residential customers by 2032, an increase of 33%o over the planning period.la
The Company's IRP summarizes the favorable FCA forecast:
Growth in the number of households within Idaho Power's service area,
combined with an expected declining consumption per household, results in
a 1.1-percent average residential load-growth rate. The number of residential
customers in Idaho Power's service territory is expected to increase 1.50lo
annually from 416,000 to nearly 555,000 by the end of the planning period in2032.ts
Because the 1.5%o growth in customers is expected to exceed the growth in sales (l.l%),
the FCA's symmetry is extremely unlikely to produce customer credits. Unless modified, the
FCA balances will continue capitalizing on trends that have little if any relation to the
Company's DSM programs.
Based on seven years of experience, the FCA has served as a revenue stabilization
mechanism far more successfully than enabling Company-sponsored energy efficiency. Staff
believes that--especially this year-the FCA has harmed customers far more than it has
benefited them, and that the FCA's efficacy diminishes in proportion to the Company's declining
energy efficiency.
For these reasons, Staff recommends that the Commission open a separate docket.
Workshops should be conducted with interested parties on how the FCA should be modified,
removed, or replaced to better address goals that the current FCA was intended to achieve. This
should be completed prior to next year's FCA filing.
'o Idaho Power 2013 Integrated Resource Plan, Appendix A: Sales and Load Forecast. June 2013, page 15.
'' Idaho Power 2013 Integrated Resource Plan, June 2013,page 49.
t2STAFF COMMENTS MAY 8,20t4
3. Possible Options for Workshop Discussions
There are a variety of options for modiffing or replacing the FCA that could foster
productive discussion at workshops. For example, workshop participants could consider
recovery of fixed costs through demand charges for residential customers. Demand charges
would reduce the amount of fixed costs recovered through energy rates, thereby reducing the
disincentive for energy efficiency, while utilizing the capabilities of the Company's AML
Another consideration for workshops is replacing the FCA with a Lost Revenue Mechanism,
which utilizes the utility's annual DSM filings to isolate energy-efficiency savings for
reimbursement. Lost Revenue Mechanisms may be more appropriate now than when the FCA
was created since the Company relies on rigorously developed Regional Technical Forum (RTF)
savings for all but five of its 235 residential measures.16
Workshop participants might also consider removing weatherization normalization from
the FCA, The Company has no more control over the weather than it does over most of the other
factors that influence use-per-customer, so there is little evidence that the weather-normalization
process fairly addresses above normal years where the Company may have recovered all its
authorized fixed costs.
C. Customer Notice and Press Release
The Customer Notice and Press Release were included in the Company's Application.
Both comply with Procedural Rule 125, IDAPA 31.01.01.125. The Customer Notices were
mailed to Company customers with cyclical billings. The last notice was mailed on April 21,
2014, which allowed customers a reasonable opportunity to file timely comments with the
Commission by the May 8, 2014 deadline.
As of May 6,2014, seven comments have been filed. Five customers oppose the
proposed increase, while one customer supports it. Another customer comments on the
Annual Adjustment Mechanism, which appears as a line item on customer bills, but does not
specifically address the proposed FCA increase.
l6 This count excludes low-income measures.
STAFF COMMENTS 13 MAY 8,2014
III. STAFF RECOMMENDATION
Staff recommends that the Commission approve the Company's FCA filing with a net
deferral balance of positive $14,912,442 for the 2014-2015 period. For the affected customer
classes, Staff recommends approval of a l.18oZ increase to total billed revenue, including the
FCA. Based on the Company's sales forecast, Staff recommends approval of FCA rates equal to
0.2913 cents per kWh for residential customers, and 0.3709 for small-general-service customers.
Staff continues to emphasize its concems about the FCA methodology and impact. Staff
recommends the Commission open a separate docket with workshops to investigate the FCA
mechanism and reevaluate its intended purpose and performance. The workshops would be open
to interested parties to discuss how the FCA should modified, eliminated, or replaced to better
address goals the FCA was intended to achieve.
Respecttully submitted this 8b day of May 2014.
lu /L
Karl T. Klein
Deputy Attorney General
Technical Staff: Matt Elam
Stacey Donohue
Donn English
Bev Barker
i :umisc/comments/ipce I 4.3kkdesdmebab commonts
STAFF COMMENTS t4 MAY 8,20t4
CERTIFICATE
I HEREBY CERTIFY THAT I
THE FOREGOING COMMENTS OF
IPC-E-I4.03, BY MAILING A COPY
FOLLOWING:
LISA D NORDSTROM
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
E-MAIL: [e-mail]
dockets@ idahopower. com
BENJAMIN J OTTO
ID CONSERVATION LEAGUE
710 N 6TH STREET
BOISE ID 83702
E-MAIL: [e-mail]
HAVE THIS 8TH DAY OF MAY 2014, SERVED
THE COMMISSION STAFF, IN CASE NO.
THEREOF, POSTAGE PREPAID, TO THE
ZACHARY L HARRIS
GREG SAID
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
E-MAIL : [e-mail]
[e-mail]
CERTIFICATE OF SERVICE