20140701notice_of_public_workshop_order_no_33067.pdf

Office of the Secretary
Service Date
July 1,2014
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE COMMiSSION’S )
INQUIRY INTO THE TRUE-UP COMPONENT )CASE NO.IPC-E-14-16
AND DEFERRAL BALANCE FOR IDAHO )
POWER COMPANY’S POWER COST )NOTICE OF
ADJUSTMENT )INTERVENTION DEADLI.TE
)
)NOTICE OF
)PUBLIC WORKSHOP
)
)ORDER NO.33067
____________________________________________________________________________________
)
On May 30,2014,the Idaho Public Utilities Commission issued Order No.33049 in
Idaho Power Company’s 2014 Power Cost Adjustment (PCA)Case,IPC-E-14-05.As part of
that Order,the Commission directed:“that a separate docket be opened to allow Commission
Staff the Company,and other interested persons to hold a workshop to further evaluate the
Company’s application of the [PCA]true-up [component]and whether a deferral balance
adjustment is appropriate.”Order No.33049 at 13.
With this Order,the Commission opens this docket,sets a 14-day intervention
deadline,and schedules a public workshop for the Company,Staff,and interested persons to
further explore these issues.
BACKGROUND
Since 1993,the PCA mechanism has allowed the Company to adjust its PCA rates up
or down to reflect the Company’s annual “power supply costs.”Because about half of the
Company’s generation is from hydropower facilities,the Company’s actual cost to provide
electricity (its power supply cost)varies from year-to-year depending on changes in Snake River
sireamfiows,the amount of purchased power,fuel costs,the market price of power,and other
factors.’The annual PCA surcharge or credit and the Company’s “base rates”are major
components of the overall rates that customers pay for power.The annual PCA mechanism
consists of three standard components.
For example,the revenue from the sale of sulfur dioxide (S02)allowances.
NOTICE OF INTERVENTION DEADLINE
NOTICE OF PUBLIC WORKSHOP
ORDER NO.33067
First.the Company forecasts or projects its power costs for the coming PCA year
(June 1.2014 to May 31,2015)using its most recent “Operating Plan.”Order No.30715.
Second,the Company “trues-up”the prior year’s projected power costs based on the Cornpany’s
actual power costs during that year.Third,the Company reconciles the prior year’s “true-up”by
crediting to or collecting from this year’s PCA rate any overrecovered or underrecovered balance
from the prior year’s “true-up.”This third,“reconciliation”component ensures that the
Company recovers its actual approved costs while ratepayers pay only for the actual amount of
power that the Company sold to meet native load requirements.Order No.29334 at 42 Thus,
ratepayers receive a rate credit when power costs are low,but are assessed a rate surcharge when
power costs are high.
In the Company’s last PCA case,IPC-E-14-05,the Commission approved the
Company’s determination of the PCA’s forecast and reconciliation components.See Order No.
33049 at 9.The Commission also acknowledged Staffs concerns about how the Company
calculates the PCA’s true-up component.The Commission stated:
Staffs concern about the true-up is well-taken.The PCA methodology—
including the true-up—is designed to “ensure the amount recovered is no more
or less than the actual power costs paid by the Company.”Order No.30828,
Case No.IPC-E-09-11.Staff raises serious doubts about whether the Company
applies the true-up in a way that achieves this result.Staff believes the
Company’s application of the true-up introduces a line-loss bias that leads the
Company to inflate the [Net Power Supply Expense]true-up revenue it must
collect by $14.2 million.If Staff is correct,then the Company’s deferral
balance should be decreased by $14.2 million (or $5.9 million,if the Company
is correct that Staff miscalculated its adjustment).However,we believe the
abbreviated time allotted for the consideration of a PCA case constrains the
parties’ability to more thoroughly vet this issue and Staffs proposed
adjustment.Accordingly,we find it is reasonable to defer our decision on
Staffs proposed adjustment so a new docket can be opened in which the
parties can hold a workshop to evaluate the Company’s application of the true-
up and whether a deferral balance adjustment is appropriate.The parties
would then report their findings to the Commission,and the Commission
would adjust the PCA deferral balance as warranted for inclusion in next
year’s PCA.
2 This reconciliation component has been referred to as the “true-up of the true-up.”
NOTICE OF INTERVENTION DEADLINE
NOTICE OF PUBLIC WORKSHOP
ORDER NO.33067 2
Id.The Commission thus ordered:that a separate docket be opened to allow Commission Staff
the Company,and other interested persons to hold a workshop to further evaluate the Company’s
application of the true-up and whether a deferral balance adjustment is appropriate.”1 d at 13.
NOTICE OF INTERVENTION DEADLINE
YOU ARE HEREBY NOTIFIED that with this Order,the Commission is opening
the new docket referenced above.
YOU ARE FURTHER NOTIFIED that persons desiring to become parties in this
matter to conduct formal discovery or present evidence or cross-examine witnesses at any
hearing must file a Petition to Intervene with the Commission under Commission Rules of
Procedure 72 and 73,IDAPA 3 1.01.01.072 and -.073.The Petition to Intervene must be filed no
later than 14 days from the service date of this Order.Once the intervention deadline runs,a
notice shall issue identifying the parties to this case.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.
NOTICE OF WORKSHOP
YOU ARE HEREBY NOTIFIED that the Commission shall convene a workshop on
WEDNESDAY,JULY 30,2014,AT 10:00 A.M.IN THE COMMISSION HEARING
ROOM,472 WEST WASHINGTON STREET,BOISE,IDAHO.The purpose of the
workshop is for the Company,interested persons,and Commission Staff to further evaluate the
Company’s application of the true-up and whether a deferral balance adjustment is appropriate,
as noted above.Following the workshop,the Commission will schedule further proceedings as
needed.
YOU ARE FURTHER NOTIFIED that all proceedings 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:
NOTICE OF INTERVENTION DEADLINE
NOTICE OF PUBLIC WORKSHOP
ORDER NO.33067 3
IDAHO PUBLIC UTILITIES COMMISSION
P0 BOX 83720
BOISE.IDAHO 83720-0074
[phone] (Telephone)
[phone] (FAX)
E-Mail:secretarvdpuc.idaho.gov
YOU ARE FURTHER NOTIFIED that all documents filed in this case will be
available for public inspection during regular business hours at the Commission offices,and on
the Commission’s web site at www.puc.idaho.gov,Click on the “File Room”tab at the top of
the page,scroll down to “Electric Cases,”and then click on the case number as shown on the
front of this document.
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.The Commission
may enter any final order consistent with its authority under Title 61.
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this I
day of July 2014.
/)I
PAUfKJELLAN1R,PRESIDENT
fltA4lL 4JL
MARSHA H.SMITH,COMMISSIONER
ATTEST:
Jean D.JewelL -
Commission Secretary
N:IPC-E-14-l6kk
NOTICE OF INTERVENTION DEADLINE
NOTICE OF PUBLIC WORKSHOP
ORDER NO.33067 4