20130605Comments.pdf

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PeterJ.RichardsonlSB#3195
Greg Adams 153 #7454 iu —s P;i ‘tRICHARDSON&O’LEARY PLLC 1
515 N.27th Street
L I H IiBoise,Idaho 83702 —
Telephone:[phone]
fax:[phone]
peterrichardsonandoleary.com
Attorneys for Glanbia Foods,Inc.
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF GLANBIA FOODS,)CASE NO.IPC-E-13-09
INC.FOR APPROVAL OF AN )
ALLOWANCE PURSUANT TO IDAHO )COMMENTS BY GLANBIA
POWER COMPANY’S RULE H LINE )FOODS,INC.
EXTENSION TARIFF )
_________________________________________________________________________
)
COMES NOW Glanbia Foods,Inc.(“Glanbia”)and pursuant to that Procedural Order
issued by the Idaho Public Utilities Commission(”Commission”)on May 7,2013,and hereby
provides its written comments as follows:
Glanbia initiated this docket on April 5,2013 with a Petition for Approval of an Allowance
Pursuant to Idaho Power Company’s (“Idaho Power”or the “Company”)Rule H.Attached to its
Petition as Exhibit B is a study conducted by Dr.Reading calculating the allowance Glanbia
believes it is entitled to using the allowance methodology developed by the Commission’s Staff.
Glanbia engaged in discovery after having filed its Petition on May 7.In its response to
Request for Admission No.2 Idaho Power stated that:
The Company caimot admit or deny that Dr.Reading’s work as shown on Exhibit B
calculates the allowance due to Glanbia using the identical methodology used by the Idaho
Public Utility Commission Staff (“Staff’)in calculating generic allowances.While it
appears Dr.Reading has used the same calculationlmethodology that Staff used in its filed
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Comments in Case No.IPC-E-O$-22,the Company did not support this methodology,and
the Commission did not approve this methodology in its final orders.Further,while the
Company is not familiar with the underlying calculations nor does it have access to the
detail underlying the analysis that Staff performed during the aforementioned Case,the
Company believes Staff could better determine if Dr.Reading used ‘the identical
methodology used by Staff.”
Dr.Reading used spreadsheets provided to him by Staff along with Idaho Power’s most recent
cost-of-service study filed in the Company’s general rate case,IPC-E-1 1-08,to derive the value of
the allowance for Schedule 19 customers.In a meeting between Glanbia and Idaho Power in
February the Company indicated that it had also been provided with the same set of spreadsheets
as provided by Staff to Dr.Reading.Therefore,the Company should have had access to the same
information provided by Staff to Glanbia and should have been able to replicate the Staffs
calculation just as Dr.Reading did.
In that same response to Request for Admission No.2 Idaho Power “denies that Dr.
Reading’s work as shown in Exhibit B [to the Petition]uses precisely the facilities referenced by
Mr.Anderson in his letter reproduced at Exhibit C [to the Petition].”It is unclear how Idaho
Power could deny (or admit)what facilities were used in the Exhibit B calculations because the
Company also stated in its response that “the Company is not familiar with the underlying
calculations nor does it have access to the details underlying the analysis that Staff performed.”
Rather the Company simply quoted the letter sent to Glanbia [Exhibit C to the Petition]that
“Allowances under Rule H are based on the cost of providing and installing Standard Terminal
Facilities,which are the overhead Terminal Facilities (transformer,meter,overhead service
conductor)most commonly installed for overhead single phase and three phase service.”It
appears because the Company does not accept the approach and methods used by Staff for
Schedule 19 allowances;it did not attempt to examine the underlying elements used in the
calculation of the line extension allowance used by both the Commission Staff and Dr.Reading.
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Also in response to Glanbia’s Request for Admission No.2,the Company stated:
While it appears that Dr.Reading has used the same calculationlmethodology that Staff
used in its filed Comments in Case No.IPC-E-08-22,the Company did not support this
methodology,and the Commission did not approve this methodology in its Final Orders.
The Commission,in its order No.30853 in Case No.IPC-E-08-22,did not discuss the
methodology developed by the Staff as it was presented in Staff’s Comments.Rather it approved
the allowance levels proposed by Idaho Power for Schedules 1,4,5,7,9 and 24.However;the
Commission failed to set an amount for Schedule 19,and indicated it should be set on a “case-by-
case”basis.See Order No.30853 at p.10.As stated in Glanbia’s Petition,Dr.Reading followed
the Commission Staffs case-by-case template for Schedule 19 in arriving at the $2,318,000
requested allowance.
The reason class specific allowance values were not set for Schedule 19 is the fact that this
customer class has such a wide diversity of usage levels and load patterns.While,for example,the
residential class’usage and load pattern vary some,they are much more homogenous than the load
patterns and usage for the industrial class.Residential allowances can be more fairly represented
by a uniform allowance value that is applicable to the class as a whole.The line extension value
for Schedule 19 is calculated on a per kWh basis,and thus can be applied on a “case-by-case”
basis for each customer’s unique circumstance with that class.Staffs approach is sound and
prevents a customer from paying twice for a portion of the cost of their requested line extension
and is based on the Company’s own cost-of-service study.The method Staff developed meets the
goal of equity for the customer while not unnecessarily driving up the rates for existing customers.
VESTED FNTEREST REQUEST
Many of the facilities that will be added,should this expansion prove economical,will be
available for use by potential future Idaho Power ratepayers.Although they are currently
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dedicated sotely to Glanbia’s toad,it is possible they will become useful for system uses.Glanbia
reasonably requested that Idaho Power identify and monitor those facilities with the goal of
providing a vested interest refund to Glanbia of the proportional use of those facilities by future
third party ratepayers.Additionally,the Company should guarantee that Glanbia will have access
to the full nameplate capacity of the expansion it pays for at no additional cost should Glanbia’s
future expansions call for additional capacity
COST CONTROL AND TRANSPARENCY
Glanbia has not been able to obtain a commitment from Idaho Power that it will be allowed
to confirm that the material and work done on this almost ten million dollar upgrade will be
competitively and transparently bid.Nor has Glanbia been assured that it will be permitted to
audit the transactions engaged in by Idaho Power for this project.Glanbia asks the Commission to
require Idaho Power to (a)competitively bid the material and work on the upgrade (b)allow
Glanbia the right to audit of the transaction and (c)allow Gtanbia to be inctuded in the design,
engineering and selection of contractors.
Wherefore,Glanbia Foods,Inc.,respectfully asks the Commission to issue its order
requiring Idaho power to provide it with an allowance for its proposed line extension in the amount
of $2,318,000,or such other amount it determines is appropriately calculated pursuant to the
Commission’methodology underlying Rule H.
Furthermore,Gtanbia Foods,Inc.respectfully asks this Commission to issue its order
requiring Idaho Power to provide it with a vested interest in upgraded facilities that are currently
solely being used to support the Glanbia facility,and the event these facilities become useful for
service to third parties,requiring those third parties to pay their proportional share of the upgrade
costs.
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DATED this 5th day of June,2013.
RICHARDSON &O’LEARY PLLC
Peter J.Richardson,ISB #3195
Attorneys GLANBIA FOODS,INC.
CERTIFICATE OF SERVICE
I HEREBY CERTIFY that on the 5th day of June,2013,a true and correct copy of the
within and foregoing COMMENTS BY GLANBIA FOODS,INC.,was served in the manner
shown to:
Ms.Jean Jewel!X Hand Delivery
Commission Secretary U.S.Mail,postage pre-paid
Idaho Public Utilities Commission Facsimile
472 W,Washington (83702)=Electronic Mail
P0 Box $3720
Boise,ID $3 720-0074
Lisa Nordstrom X Hand Delivery
Donovan Walker U.S.Mail,postage pre-paid
Idaho Power Company —Facsimile
P0 Box 70 X Electronic Mail
Boise,Idaho 83 707-0070
[e-mail]
dwalker(idahopower om
Nina Cutt
Administrative Assistant
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