20150904Decision Memo.pdf

DECISION MEMORANDUM
TO:COMMISSIONER KJELLANDER
COMMISSIONER SMITH
COMMISSIONER RAPER
COMMISSION SECRETARY
LEGAL
WORKING FILE
FROM:TERRI CARLOCK
DATE:SEPTEMBER 4,2015
SUBJECT:IDAHO POWER COMPANY’S APPLICATION FOR AUTHORITY TO
BORROW UP TO $450,000,000 IN SHORT-TERM DEBT;
CASE NO.IPC-E-15-23
On August 14,2015,Idaho Power Company applied for authority to borrow short-term
debt up to $450,000,000 aggregate principal amount at any one time.Idaho Power’s current
short-term borrowing authority was granted by Order No.32343,dated August 30,2011.This
requested authority could extend the authority through November 30,2022.The required fees
have been received.
The borrowings under the requested authority may consist of 1)loans evidenced by
unsecured notes or other evidence of indebtedness and 2)unsecured promissory notes and
commercial paper.Any note issued will have a maturity of not longer than one year and a set
interest rate or discount rate.Idaho Power intends to obtain new unsecured lines of credit or
extend exist unsecured lines of credit.Each line of credit will provide a specific dollar amount
be available to draw upon for a fee.Uncommitted credit facilities may also be utilized on an “as
available”basis at negotiated interest rates.Idaho Power expects the initial Credit Agreement
will be for $300,000,000 with the option to increase the limit to $450,000,000.Idaho Power will
provide the Commission with written notification in the event it increases the limit above
$300,000,000.
Idaho Power requests the short-term borrowing authority be authorized initially through
November 30,2020 with the ability to extend the time period for two one-year extensions
through November 30,2022.Idaho Power will provide written notification to the Commission if
DECISION MEMORANDUM I SEPTEMBER 4,2015
it elects to exercise either of the one-year extensions beyond November 30,2020.In no event
will any borrowings under this authority extend beyond November 30,2022.
Idaho Power requests this borrowing authority be continuing through November 30,2022
so long as Idaho Power’s senior secured debt rating is investment grade,at least BBB-or higher
by Standard &Poor’s and Baa3 or higher by Moody’s Investors Service.If Idaho Power’s rating
falls below investment grade,Idaho Power will follow the current Commission approved filing
process to establish its ongoing borrowing authority.
The net proceeds will be used to obtain temporary capital for one or more of the
following purposes:(a)the Company’s acquisition,construction,completion,extension or
improvement of facilities,(b)the improvement or maintenance of service,(c)discharge or
refunding of obligations,and (d)for general corporate purposes.
STAFF RECOMMENDATION
Staff recommends approval of the proposed short-term borrowing authority up to
$450,000,000 in total,for the period through November 30,2022.Staff recommends the
proposed filing requirements be adopted.Staff also recommends the authority under this initial
approval be continuing (without further order required)provided Idaho Power maintains senior
secured debt ratings that are investment grade,BBB-/Baa3.
COMMISSION DECISION
I.Does the Commission wish to approve Idaho Power’s request for short-term
borrowing authority up to $450,000,000?
2.Does the Commission approve the borrowing authority for the period through
November 30,2022 as proposed?
2.Does the Commission wish to allow its authority under this Order to be continuing
during the authorized term provided the senior secured debt rating levels remain investment
grade?
3.Does the Commission adopt the identified filing requirements?
Tern Carlock
TC:TPC-E-15-23 STDebL 45DM dm9 2015
DECISION MEMORANDUM 2 SEPTEMBER 4,2015