20140627Decision Memo.pdf

DECISION MEMORANDUM 1
DECISION MEMORANDUM
TO: COMMISSIONER KJELLANDER
COMMISSIONER REDFORD
COMMISSIONER SMITH
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM: KARL T. KLEIN
DEPUTY ATTORNEY GENERAL
DATE: JUNE 27, 2014
SUBJECT: COMMISSION INQUIRY INTO IDAHO POWER’S FCA, CASE NO. IPC-
E-14-17
On May 30, 2014, the Idaho Public Utilities Commission issued Order No. 33047 in
Idaho Power Company’s Fixed Cost Adjustment (FCA) Case, IPC-E-14-03. In the Order, the
Commission approved the Company’s FCA Application. See Order No. 33047 at 7. But the
Commission acknowledged Staff’s concerns that the FCA mechanism is fundamentally flawed
and that the FCA no longer serves its intended purpose of removing the Company’s perceived
financial disincentive to investing in energy efficiency and Demand-Side Management. The
Commission stated:
While we approve of the Company’s Application, we continue to
acknowledge that the FCA is an imperfect mechanism that warrants
monitoring, discussion and review. See Order Nos. 32505 at 6 and 32731 at 4,
Case No. IPC-E-11-19. We thus intend to open a separate, future docket to
allow Commission Staff, the Company, and other interested persons to further
evaluate Staff’s concerns about the FCA mechanism (including the weather-
normalization, customer count, rate adjustment cap, and cross-subsidization
issues) and whether the FCA is effectively removing the Company’s financial
disincentive to aggressively pursue energy efficiency programs.
Id. The Commission concluded by ordering that a new case be opened to address these issues.
Id. at 8.
STAFF RECOMMENDATION
Staff recommends the Commission issue a Notice of Intervention Deadline that initiates
this case, sets a 14-day intervention deadline, and directs Staff to convene an informal prehearing
DECISION MEMORANDUM 2
conference with the parties after the intervention deadline runs. After the prehearing conference
occurs, another Order can issue setting further procedure as necessary.
COMMISSION DECISION
Would the Commission like to issue a Notice of Intervention Deadline that initiates this
case, sets a 14-day intervention deadline, and directs Staff to convene an informal prehearing
conference?

M:IPC-E-14-17_kk