20130909Motion to Take Official Notice.pdf

Peter J. Richardson ISB # 3195
Gregory M. Adams ISB # 7454
RICHARDSON ADAMS, PLLC ?iI I:JI.;, * , [-;i I' ? I
515 N.27th Street
Boise, Idaho 83702
Telephone: (20S) 938-2236
Fax: [phone]
peter@richardsonadams. com
gre g@richardsonadams. com
Attomeys for the J. R. Simplot Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE ) CASE NO. IPC-E-13-17
APPLICATTON OF THE J. R. SIMPLOT )
COMPANY TO PURCHASE AND ) J. R. SIMPLOT COMPANY'S
ASSUME OWNERSHIP OF CERTAIN ) MOTION TO TAKE OFFICIAL
rDAHO POWER OWNED FACILITIES ) NOTICE AND OFFER INTO
AND TO SET A PURCHASE PRICE ) EVIDENCE
THEREFORE
INTRODUCTION AND SUMMARY
COMES NOW the J. R. Simplot Company ("Simplot") and pursuant to Rules 262 and
263 of the Rules of Procedure of the Idaho Public Utilities Commission ("Commission") and
submits this Motion to Take Official Notice (Rule 262) and Offer into Evidence (Rule 263) of
relevant portions of the testimony and exhibits in Case no. IPC-E-I1-08. As stated in Simplot's
Reply to ldaho Power Company's ("Idaho Power" or the "Company") Motion to Dismiss for
Lack of Subject Matter Jurisdiction ("Motion"):
[T]he underlying testimony and order in the general rate case (Docket No. IPC-E-l l-08)
are so intertwined with the issues raised by Idaho Power's Motion, Simplot is
contemporaneously filing a motion for official notice of the relevant portions of the
testimony to allow for it to be a part of the record in this proceeding.'
t Simplot Reply at p. 2.
This Commission's rule ofprocedure, at Rule 262, provides:
When aparty offers in evidence any portion of a transcript, exhibit, or other record from
any other proceeding before the Commission, the portion offered must be specifically
described and, if admitted, will be made an exhibit.
ln addition, Rule 263 allows for the Commission to take official notice of maters of common
knowledge. Therefore, Simplot offers the following specifically describe portions of testimony
and exhibits from ldaho Power's last general rate case proceeding in which Rule M was adopted:
l. The opening colloquy and the public witness testimony of Mr. Stace Campbell,
Tr. l0 - 25. Exhibit 4, the Application (deemed Petition) contains Simplot's first three Exhibits.
2. The direct (live) testimony, prefiled rebuttal testimony and cross examination
testimony of Mr. Warren Kline on behalf of Idaho Power Company. Tr. 133 - 178, attached as
Exhibit 5.
3. The direct (live) testimony, prefiled rebuttal testimony, cross examination
testimony and Exhibit 52 of Mr. Mike Youngblood on behalf of tdaho Power Company. Tr.236
- 306, attached as Exhibit 6.
4. The direct (live) testimony, prefiled direct testimony and cross examination
testimony of Mr. Del Butler on behalf of the Industrial Customers of Idaho Power. Tr. 340 -
360, attached as Exhibit 7.
5. The direct (live) testimony, prefiled direct testimony, cross examination testimony
and Exhibits 301 - 308 of Dr. Don Reading on behalf of the Industrial Customers of Idaho
Power. Tr.362 - 450, attached as Exhibits 8A and 8B.
6. The direct (live) testimony, prefiled direct testimony and cross examination
testimony of Mr. Don Sturtevant on behalf of the Industrial Customers of ldaho Power. Tr. 451
J. R. STMPLOT,s MOTION FOR OFFICIAL NOTICE AND OFFER INTO EVIDENCE
IPC-E-13-17
PAGE 2
- 491, attached as Exhibit 9.
In order to respond to the legal issues raised by Idaho Power's Motion the Commission
will need to fully understand the genesis of Rule M and Idaho Power's positions with regard to
customer purchases of facilities owned by Idaho Power on the customer side of the meter. The
testimony and exhibits Simplot hereby moves into the record are necessary for the Commission
to make its ruling on Idaho Power's Motion and Simplot's Answer thereto.
This Motion is appropriate under Rule 263(b)(1) as the existence of the testimony and
exhibits offered is commonly known and beyond dispute. Further, the substance of the
testimony and exhibits are not in dispute. This Motion is also appropriate under Rule 262 as the
testimony and exhibits are relevant and necessary for the Commission to make an informed
decision. These testimony and exhibits should be made apart of the record in this proceeding to
ensure the administrative record is complete in the event of any subsequent appeal.
Wherefore, Simplot respectively moves for official notice and/or the admission of
Exhibits 4, 5, 6,7,8A,88 and 9 attached hereto.
RESPECTFULLY SUBMITTED this lOth day of September 2013
RICHARDSON ADAMS, PLLC
Peter J.
Attorneys for J.R. Simplot Co.
J. R. SIMPLOT,s MOTION FOR OFFICIAL NOTICE AND OFFER INTO EVIDENCE
IPC-E-13-17
PAGE 3
CERTIFICATE OF SERVICE
I hereby certify that the 6ff day of Septemb er 2013, copies of the foregoing Motion for
Offrcial Notice and accompanying exhibits of the J. R. Simplot Company were delivered to:
Jennifer M. Reinhardt-Tessmer Jean JewelLisaNordstrom Secretary
Idaho Power Company
1221 West Idaho
Boise,Idaho 83702
Kris Sasser
Counsel
Idaho Public Utilities Commission
47 2 W est Washington Street
Boise,Idaho 83702
Idaho Public Utilities Commission
472West Idaho
Boise,Idatro 83702
J. R. SIMPLOT,s MOTION FOR OFFICIAL NOTICE AND OFFER INTO EVIDENCE
IPC-E-13-17
PAGE 4
EXHIBIT #4
J. R. SIMPLOTCOMPANY'S MOTION TO
TAKE OFFICIAL NOTICE AND/OR OFFER
INTO EVIDENCE
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120511mrn. txt
BOISE, IDAI{O, i4ONDAY, DECEMBER 5, 2011, 9:30 l. ltl.
co$4MrssroNER sMrrH: Good morning, lad'ies
and gentlemen. rhis is the time and place set for a
hearing in rdaho public uti'lities commission case No.
rPc-E-11-08. It is a'lso further identified as in the
matter of the app'lication of rdaho pou,er company for
authority to increase its rates and charges for electric
service in rdaho.
For those of you who haven't been here
before, the three of us are the pub]ic utilities
commission. on my left is president paul rje'l'lander, and
on my right is commissioner uack Redford. r'm Marsha
smith and t'm chairing this hearing.
we'll begin by taking the appearances of
the parties, beginning with the npplicant.
MS. NORDSTROM: thank you. Good morning.
My name is t-isa ttordstrom and r am representing rdaho
Poiler, and seated with me is my co-counsel, Jason
wi'll i ams .
COMMISSIONER rhank you. Mr.
otto.
MR. oTTo: Good morning. rhis is aenjamin
otto with the rdaho conservation teague, and with me at
CSB REPORTING(208) 890-s198
J. R SIMPLOT COMPANY'S MOTION TO TAKE
OFTICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit #4
rage 1"
coLL@uY
1205llmrn . txt
1 the table are Nancy xirsh with the Northwest Energy
2 coalition and ren uiller from the snake River R'lliance.
3 CO.IMTSSIoNER SMITH: Thank you.
4 Mr. Howell.
5 MR. HO,'IELL: oonald ttowe'l'I, oeputy
6 Rttorney General, and tcar] rlein, Deputy Attorney
7 General, representing the comission staff today.
I COIUIMISSIONER SMITH: A'l] ri ght,
9 ur. eurdy.
10 MR. PURDY: thank you. erad eurdy on
11 behalf of the community Action partnership lssociation of
LZ rdaho and with me today is t,ts. Teri ottens, cAPAIrs
13 witness.
L4 CO,III4ISSIONER SMfTH: Mr. Olsen?
15 MR. oLSEN: Yes, Eric olsen with the rdaho
16 trrigators Pumpers association.
L7 MR. NELSoN: Good morning. rhor tte'lson
18 and rred schmidt back here with the law firm of uo'lland &
19 Hart on behalf of the ttlicron rechnologies.
20 cotr,s4ISSIONER SMITH: Mr. ni chardson.
2L MR. RICHARDSoN: Thank you, l,tadam chair.
22 Peter Richardson with the firm Richardson & o'Leary here
23 on behalf of the tndustrial customers of rdaho Power, and
24 with me are my w'itnesses Dr. Don Reading, oe1 Butler, Don
25 sturtevant, and a'lso with the lndustrial customers here
CSB REPORTING 11 COLLOQUY(208) 890-5198
1 this morning is Eric Erickson with lmalgamated sugar and
2 ;im Bergan with clanbia roods.
3 COIVUVIISSIoNER REDFORD: what was the last
4 one, p'l ease?
rage 2
J. R. srMpI,or coMpANy's MorIoN To rAKE Prge 2
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit #4
120511mrn. txt
5 MR. RICHARDSON: :im aergan with
6 Glanbia.
7 CO4MISSIONER SMTTH: MT. Mi.IIer.
8 MR. MILLER: fhank you, Madam Chairman.
9 Dean J. Miller with the firm Mcoevitt & Mil]er on behalf
10 of noku l,taterials, rnc. r'm here unaccompanied.
11 COMMTSSTONER SMrTH: How sad, and I notice
L2 they've strategical'ly deniid you a microphone.
13 MR. MILLER: that was probably good
14 thinking on somebody's part.
15 Co[n4TSSIONER SMITH: Okay, is there anyone
16 here appearing on beha'lf of rroger?
L7 MS. KYLER: Yes, that's me.
18 CoIUIMISSIONER SMITH: okay.
19 MS. KvLER: :ody u. ryler with the firm
20 goehm Kurtz & towry on behalf of rhe Kroger Company, and
2t with me is my witness Kenneth C. Higgins.
22 colm,tlssloNER SMITH: nnd us. ry'ler, could
23 you please spel'l your last name?
24 Ms. KYLER: r-y-I-e-r.
25 coMMrssroNER sMrrH: thank you.
CSB REPORTING T2 COLLOQUY(208) 8eo-5198
L coin4rssroNER REDFoRD: where are you
2 from?
3 lus. KYLER: cinncinati, ohio.
4 CO,IMISSIONER REDFORD: rs that part of
5 the united states?
6 CcF,lMrSSIOlrlER SMITH: A'l'l right, the only
7 other -- that is the appearances by al'l the parties who
8 are on my Notice of parties list, except for the
eage 3
J. R. sIMpLor coMpANy's MorIoN To rAKE Pege 3
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit #4
120511mrn.txt
9 Department of rnergy. I would note that the DoE has sent
10 a letter requesting to be excused from the hearing and
11 noting their participation in the development of the
L2 stipulation and its support for that, so the attorneys
13 for the Department of fnergy are excused from today's
L4 hearing.
15 Before we begin with preliminary matters,
16 r believe we have one person who is a member of the
L7 public who is not avai'lable to be at our pub'lic hearing
18 tonight and wishes to testify, so we will take him first,
19 wherever he is.
20 our procedure for public witness testimony
2l is you come up here, president rjeilander wi'll ask you to
22 raise your right hand and swear you 'in, and staff counsel
23 will ask you a coup'le of questions to get you on the
24 record correct'ly and then you'1l be able to give your
25 statement.
CSB REPORTING 13 COLLOQUY(208) 8e0-s198
1 STACE CAMPBELL,
2 appearing as a public witness, having been du'ly sworn,
3 was examined and testified as follows:
4
5 EXAMINATION
6
7 BY MR. HOh'ELL:
8 Q eood morning, sir. cou'ld you state your
I ful1 name and spe1l your last for the record, please?
10 A My name is Stace James Campbell,
11 C-a-m-p-b-e-l-.l.
LZ a md mr. Campbe1l, whom are you employed
eage 4
J. R. sIMpLor coMpANy's MorIoN To rAKE Page 4
OTFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit #4
120511mrn. txt
13 by?
t4 A ptccain roods, usA.
15 a and you are presenting public testimony on
16 their beha'lf tonight?
L7 A Yes,Iam.
18 a or today, and please give the commission
19 your statement.
20 A okay, thank you. r'm here on beha'lf of
2L Mccain roods in concern of the rcl facility charges that
22 are tied to distribution facilities. a couple of th'ings
23 that we wanted to comment on, especial'ly to the
24 commission, is the DFrR costs associated with equipment
25 on our propert'ies in rdaho, and our concern is that the
L4CSB REPORTING(208) 890-5198
CAMPBELLpub'li c
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facility charges aren't in line, are not actually
representative of the risk for which Idaho Power faces
with those, and the charges and the percentage rate for
which they are bi'l'ling us at are not in line with what we
would expect.
r want to state some examples. lfter a
pretty tough time of getting the information out of rdaho
power, we were able to pul1 a report that shows that we
have transformers on our property, one of which is 56
years old, has a stated value of $904. rt costs us $184
a year in facil'ity charges. tt's $10,327.3O over the
'lifetime that it's been there that we have been charged
for and it could have been replaced 1L times.
rhe risk for rdaho Power is very 'low, very
minimal in regard to these transformers as 50 percent of
our transformers are over 20 years o1d. 70 percent are
Page 5
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit #4
Pege 5
120511mrn. txt
L7 over 15 years o'ld. rhe risk of failure is quite low;
18 however, we're to'ld on a repeated basis by rdaho Power
19 that those charges are there to mitigate the costs of
20 replacement and maintenance on our facilities. However,
2L in the same conversation, they discussed that they're
22 limiting their ability to support us via TsA's and are
23 reducing their scope of work that they'll provide in our
24 facility, so we question why we're billed monthly over
25 $8,900 a month, u{hy we pay over $107,157 a year in
CSB REFORTING 15 CAMPBELL(208) 890-5198 Public
1 facility charges and why that is an impact of us that
2 reduces our competitive edge in the market.
3 For us to be competitive, we have to keep
4 our costs'low. rhis is a cost that we feel is an added
5 cost of the ownership of the property that resu'lts in an
6 unnecessary revenue extreme for rdaho Power that costs
7 jobs. hte have near'ly 700 direct employees at that
8 faci'lity. with this average annual charge, we could add
9 two additional emp'loyees which would reflect at least an
10 additional 1.75 in direct jobs. For us to remain
11 competitive, we have to keep our costs low. we fee'l that
L2 this is an impact that needs to be'looked into by the PUc
13 and we do not agree with it.
L4 COMMISSIONER SMITH: DOES thAt CONCIUdE
15 your statement?
16 THE wrrNESs: rt does.
L7 Co$4MTSSIONER SMITH: Let's see if there
18 are any questions for you.
19 MR. wTLLTAMS: Yes, Madam chairman, just a
20 couple. Jason williams on behalf of rdaho Power.
eage 5
J. R. sIMpLor coMpANy's MorIoN To rAKE Page 6
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit #4
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1205l1mrn . txt
1 faci'lities across the globe and we have some in this
2 particular market. our facility 'is not the Iowest cost
3 within this particular reg'ion in surley. trrte have others
4 in this region that are lower cost.
a Your overall bi1'ls, though?
A our overall bi'l'ls? our overa'l'l bills are
competitive in regard to our utilities; however, there is
8 room for improvement there.
5
6
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10 you.
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LZ nedford.
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coMMrssroNER KJELLANDER: Okay, thank
CO$4MISSIONER SMITH: Comtissioner
EXAMINATION
16 BY COMMISSIONER REDFORD:
17 a Yes, sir, how long has this particular
18 p'lant that you're referencing been there?
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A under various ownership, it's changed
hands over the years, as far as wtccain, it's been since
the mid '90s; however, the faciljty was initially
producing potatoes back in the 1950s. The first
transformer that we have on site that is stil] under a
24 faci'lity charge was p"laced in 1955.
25 a h,hen you were doing your due
CSB REPORTING(208) 890-5198
1 your purchase of this p1ant, did
eage 9
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICI-AL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit #4
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dif igence for
CAMPBELL (COrN)publ i c
you take a Iook at or
1205l1mrn. txt2 review the tariffs of rdaho Pover that would be
3 applicable to you?
4 A r was not employed at uccain at the time
5 during that purchase; however, under due diligence on my
6 part and acquiring data, it was not clear even at that
7 time what the facility charges represented, and that
8 information 'is very hard to extract from tdaho Power.
9 A so how Iong did it take you to extract
10 that information?
11 A r.aultiple requests, and over a three-week
tZ period of almost constant dai]y requests, r finally did
13 receive the data.
14 a Doesn't your invoice or your statement
15 provide a line item for facilities charges?
L6 A rt provides a line item that shows a
L7 sing'le dollar amount. You get a summary report that
18 breaks it down into four categories, but you do not know
19 what those assets are unless you actua'l'ly request that
20 data from rdaho Power. rhey pull a report which lists
2l the asset by its va1ue, its location, its description and
22 year of service.
23 a can you work back through the numbers that
24 you get on your invoice to gain any of that information
25 or do you have to get it directly from ldaho Power?
CAMPBELL (COM)publ i cCSB REPORTING(208) 890-5198
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A you have to get it directly from tdaho
Power. rt is not exposed on your bill or any bi'lling
statement
a okay, we'I1, the question r have is, 'it's
my understanding that when whoever your predecessor was
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit #4
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120511mrn. txt6 started using rdaho Power that the
7 facilities charges, and for special
8 it did not provide for ownership by
9 correct?
schedule provided for
contracts like yours,
your company; is that
transformer over the
that been
A That's my understanding is that the
original ownership, which was rPPr and Atlantic and
pacific corporations, the initial facility charges were
laid out. From what t've been ab'le to ascertain from
employees that have 40 plus years of experience at the
facility and were involved in this over the years,
there's never been real1y a clear description of the
facility charge structure. rt's not even -- there isn't
even any documentation that exists as far as when a piece
of equipment is brought in what that equipment is valued
at, what that facility charge is going to be. rt's a
post event, so after that equipment is put in or
replaced, then the evaluation of it is given to the
customer, and f just verified that recently. we did
place two new transformers. r did not get the DFrR
report which showed that increase for 90 days.
cAMPBELL (com)publ i c
CSB REPORTING(208) 890-5198
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HOW many times has a
2 years that you've been involved with
3 replaced?
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r did investigate into that and over the
years there are no recorded instances of transformer
direct failures on that faci'lity, and as r stated, one of
the original transformers from 1955 is still there.
There have been replacements due to Ioad increases.
There have been remova'ls due to load reductions, but they
nage 11
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit #4
Pagc I I
120511mrn. txt10 have not had a direct fai'lure of a transformer on that
11 facility.
L2 a well, it seems to me like that's pretty
13 darn good insurance that you have, that you know very
L4 we1l that in the event a transformer goes down that rdaho
15 power will be right there or within a reasonable period
16 of time to replace the transformer.
Ll A r don't feel as though it's an insurance
18 policy. we don't fee'l as though it's an insurance policy
19 due to the fact that some of our transformers they don't
20 even have readily available for us and we are actually
2L required to keep a spare of our uniques on our property
22 and they GPs it there which we're paying a facility
23 charge on so that they can support a fa'ilure if it were
24 to occur.
25 rn addition to that, w'ith the rare event
cSB REPoRTING 22 CAMPBELL (com)[phone] Public
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of a failure, rdaho Po{er has recently brought to 'light
with this that they are no longer supporting our TsA
agreements, so therefore, we are relying upon contractors
to provide those services.
a And these faci1ities charges are stil'l
going on?
- A rhe facility charges have not been
affected at all.
a It seems to me that there are others
similar'ly situated, do you beiong to an organizat'ion that
monitors things like this?
A our particular fac'ility, r am the
re'liability engineer for the facility and it's under my
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit #4
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12051tmrn.txtinformation-gathering and under my d'irection to feed that
information to some of our corporate guidance; however,
we're not a member, as we stated we're not a member, of
the rest of the group that's here. trle're independent.
a It just seems to me that and the question
is have you approached rdaho power about maybe
negot'iating out either a neuu faci'lities charge or a
purchase of these facilities?
A Yes. rn fact, that conversation has gone
on for more than two years now and t have discussed this
directly with our large power customer representative Sam
eolay and h'is direct management stephen Mews. we've
23CSB REPORTING(208) 8eo-5198
J, R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit #4
CAMPBELL (COM)publ i c
1 discussed it with the power quaf ity group and we have not
2 been ab'le to make any forward steps with that discussion.
3 Our facility is a mixed-use facility, I
4 should clarify that, to where McCain roods owns the
5 majority of the distribution on the facility and rdaho
6 power owns the transformers and some of the fuse cutouts
7 and a few of the structures on the property, however,
8 very 'limited. rt's a unique arrangement and we have
9 tried to obtain ownership of that, but it falls on deaf
L0 ears.
11 a But nevertheless, it's in the tariff and
LZ it's in the contract. r'm just wondering if you and
13 others need to make another last effort and if that
L4 doesn't work out to come back to the Comm'ission and have
15 the commission make some resolve of this. t realize that
16 u'Je're not constrained for time, but we certainly want to
t7 dispose of those issues that can be otherwise disposed of
Page 13 Page 13
120511mrn. txt18 by the parties. would you be wilfing to enter into some
19 sort of an agreement with rdaho Pourer to negotiate with
20 the others who are simtlarly situated and if it doesn't
2l work out come back to the commission on a sing'le issue
22 case?
23 A ttty feeling 'is, sir, and the feeling of our
24 company is that we are being constrained on a very
25 regular basis by changes that Idaho Poweris making to
CSB REPORTING 24 CAMPBELL (Com)
[phone] public
1 their transmission and distribution facj'lity charges to
2 our facility. we've tried this open discussion with them
3 over a two-year period and we are not having great
4 success with that and, therefore, that's why we're here
5 to show the support to the rest of the group today, and
6 we feel as though rdaho Pover just doesn't have an open
7 ear and does not wish to listen to us, so we're a'lways
8 open to any opportunity that's going to have some
9 fruitful end.
10 a fust one question more. when a
11 transformer goes down, what's the time from the time that
L2 you note that the transformer has gone down unti'l the
13 time that rdaho Power is there to do the repair or
L4 rep'lacement work?
15 A we haven't had a fai]ure of a transformer.
16 t couldn't tell you what that time is, sir.
L7 coMMrssroNER REDFoRD: rhank you very
18 much. I appreciate you taking all your time.
L9 COMMISSIoNER SMITH: We thank you for
20 appearing here and appreciate your help with the case.
2L THE WITNESS: rhank you very much.
J. R. SIMPLOT COMPANY'S MOTION TOTAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit #4
eage 14
Page 14
1205l1mrn. txt22 COtfiISSIO[tlER SMrTH: rhank you.
23 (rhe witness left the stand.)
24 CO'I!4ISSIONER SMITH: e1l right, we've done
25 the appearances. Ms. Kyler, are you admitted to practice
cie neponrtNe 25 cAITiIPBELL (com)[phone] Public
J. R' SIMPLOT COMPANY'S MOTION TO TAKE
3{izsieia,,.u" r ' oFFICIAL Itl-ortcE, e'uoloR oFFER INTo EVIDENCE
Exhibit #4
'iir&.rq:*g.d,:'d; "
Pagc 15
EXHIBIT #5
J. R. SIMPLOT COMPANY'S MOTION TO
TAKE OFFICIAL NOTICE AND/OR OFFER
INTO EVIDENCE
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MR. I{ILLIAMS: Madam chair, at this time
we wou'ld like to call mr. warren rline to the stand.
2LJ. R. SIMPLOTEOMPANY'S MOTION TOTAKE
oFFrcrAL NorrcE AND/oR oFFER INTo rvmpxcf,dge
Exhibit 5
120511mrn. txt
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CSB REFORTING(208) E90-5198
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nage 112
J. R. SIMPLOT COMPANY'S MOTION TOTAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Erhibit 5
135 DMKE (Di)
rdaho Power company
WARREN KLINE,
produced as a trrri tness at the i nstance of the rdaho Pouer
company, having been first duly sulorn, was examined and
testified as follorus:
DIRECT EXAMINATION
BY MR. WILLIAftIS:
a cood mornJng, Mr. rline.
A cood morning.
a cou'ld you please state your name and speIl
your last for the record?
A My. name is warren Kline, K-l-i-n-e.
a ay whom are you employed and in what
capacity?
A r'm emp'loyed by rdaho power company in the
capacity of vice president of customer operations.
A Are you the same warren Kline that filed
rebuttal testimony on November 16, 2011?
A IAM.
a nnd if r were to ask you here today under
oath the same questions set forth in your prefiled
testimony, would your answers be the same?
A Yes, they would.
Page 2
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120511mrn. txt
Do you have any corrections ora
CSB REPORTING(208) 8e0-s198
136
modifications to make to your testimony?
A No, I do not.
MR. wrLLrAMs: Madam chair, at this time r
move that the rebuttal testimony of h,arren rline be
spread upon the record as if read.
COMMISSIONER SMITH: If thErE iS NO
objection, it is so ordered.
(rhe fol'lowing prefiied rebuttal testimony
of ur. warren Kline is spread upon the record.)
KLINE (Di)
rdaho Power company
KLINE (D.i)
rdaho Power company
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CSB REPORTING(208) 8e0-s198
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
rage 113
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Prge 3
1205llfirrn. txt
1 Q. Please state your name and
2 business address..
3 A. My name is warren Kline and my business address
4 is L22L west rdaho street, Boise, rdaho.
5 Q. Are you the same warren K'line that submitted
6 direct testimony in this proceeding?
7 A. Yes, r am.
8 e. what is the purpose of your rebuttal testimony?
9 n. r will describe rdaho power company's ("rdaho
10 Power" or "company") faci'lities charge service option
11 from a customer service standpoint, particularly some of
t2 the issues associated with mixed ownership of fac'i'lities
13 and with company personnel maintaining customer-owned
14 facilities. r will also respond to the characterization
15 made by the rndustrial customers of rdaho Power ("rcrP")
16 that the company's facilities charge option is an unfair
L7 business practice.
18 a. what issues are you not d'iscussing in your
19 rebuttal testimony?
20 A. r am not testify'ing about any tariff language,
2L the appropriate rate or methodology for the faci'lities
22 charge buyout, or any other regu'latory or ratemaking
23 matters. company witness Mr. scott sparks wi'll testify
24 regarding the faci'lities charge rate methodology and
25 company witness Mr. Michael voungblood will test'ify
j,i
CSB REPORTING(208) 890-5198
1
J. R SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
KLINE (Di)rdaho Power company
138
eage 114 Page 4
120511mrn. txt2 regarding the facilities charge buyout option as we'l'l as
3 the regulatory and ratemaking 'issues associated with
4 facilities charges.
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a. please describe at a very high ]evel the
purpose of the faci'lities charge.
A. rhe facilities charge is a service that a'llows
primary and transmission service level customers the
option, when agreed to by the company, of having the
e'lectrical facilities necessary to supply service beyond
the company's point of delivery oruned, operated, and
maintained by rdaho power in consideration of the
customer paying a month'ly charge. rt is very important
to note that Idaho Power provides this service at its
optton to the approximate'ly 240 rdaho jurisdictional
customers that have requested it.
a. please describe what you nean when you say
"beyond the company's point of delivery."
A. rhe point of delivery is the po'int between the
facilities owned by the company and the faci'lities owned
by the customer. For primary and transmiss'ion customers,
the point of delivery is most commonly the customer's
23 property 'li ne.
24 a. Are a'11 primary or transmi ssi on servi ce I eve'l
faci'lities charge?25 customers obligated to pay a
139 KLINE, REB 1
rdaho Power company
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A. No. rhe
de'livers energy to
and, if necessary,
voltage at which it
general rule is that the company
a point at the customer's 'location
the transformation of power to the
is to be used is the customer's
eage 115J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Erhibit 5
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1205lImrn. txtresponsibility. edditionally, the service provisions
for facilities beyond the point of delivery detailed in
Idaho Power's Schedules 9 and 19 state:
At the oDtion of the comDanv. transformers andotlrer fatitities.i.nsta'llLd 66yond the.point ofnd the point ofoelivery to provide erimary or Transmission
Service may be owned, operated, and maintainedbv the combanv in consideration of the customerpaying a pacilities charge to the company.
customers pay a faci'lities charge only if the
company is providing the faci'lities charge service.
a. p'lease explain why rdaho Power provides a
facilities charge service option.
A. with regard to customers eligible for the
facilities charge service, the customer has an initia'l
choice to make. the general rule is that customers are
required to own, operate, and maintain their own
2L equipment beyond the company's po'int of delivery. Both
22 historica]1y and today, some rdaho Power customers do not
23 or cannot do this for themselves; thus, they ask the
24 company for the facilities charge option to relieve them
25 from this requirement. customers request this option
140 KLINE, REB 2rdaho Power company
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because sometimes they do not want to expend the capital
needed to
J. R. sIMpLor coMpANy's MorroN To rAKE eage 116
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
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141 KLTNE, REB 2
rdaho Power company
1 construct the facilities and/or they may not have theexoertise in their orqanization or the ilesire to ooerate2 anll maintain the faciTities. rn these instances, iuhen the
company agrees, tdaho Poh,er will provide this service.3 C. -lre tustomers ob'ligated'to take the faci]ities
4 charge service from rdaho potrler?
5 A. No. As r exp'lained above, the Company only
6 provides this service upon the request of the customer
7 and if the company agrees to provide the service. there
8 may be instances where the customer has both the capital
9 and trained personnel to fund, design, insta'll, and
10 maintain its own facilities beyond the Company's point of
11 delivery but wants to take advantage of the other
L2 benefits that the facilities charge option provides.
13 a. what other benefits does the fac'ilities charge
J. R. stMpl.or coMpANy's MorroN To rAKE eage 117 PageT
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
120511mrn. txtL4 option provide?
15 A. tf there is a problem with the equipment that
16 the customer is paying fac'ilities charges on, rdaho Power
Ll provides 24 hours a day, 7 days a week customer service
18 for that customer. rdaho Power has an inventory of
19 equipment across its service area that can be used if
20 needed along with a fleet of trucks and trained personnel
2L ready to respond to service trouble, including emergency
22 situations. rdaho Power also has the communications
23 systems in p'lace and the dispatchers needed to dispatch
24 the crews to
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142 KLTNE, REB 3rdaho Power Company
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J. R. srMp,-or coMpANy's MorIoN ro rAKE eage 118
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
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143 KLINE, REB 3rdaho Power company
1 respond. rn short, rdaho Power has the necessary
2 business infrastructure and it stands ready to respond
3 when cal'led upon. uany facilities charge customers p'lace
4 a high value on this service.
5 a. what leads you to believe that faci'lities
6 charge customers place a high va'lue on this service?
7 A. other than the l.R, simplot company
I ("simplot"), none of the company's other approximately
9 240 facilities charge customers in rdaho have formally
10 requested a buyout option in recent memory. r believe
11 this indicates that the vast majority of the company's
LZ other facilities charge customers have appreciated and
13 benefited from the company operating and providing
L4 maintenance on faci'lities that they would have had to pay
15 for and maintain themselves. Thus, r believe simplot may
16 be unique, if not in a very sma'|l minority of customers,
Ll who now desires to expend the financial capital and has
18 the expertise to operate and maintain its own e'lectrica'l
19 facilities. That is not to say that other customers u,ere
20 in the same position when they first requested the
J. R. sIMPLor coMpANy's MorIoN To rAKE eage 119 Page 9
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
12051lmrn . txt2L company to provide facilities beyond the company's point
22 of delivery. Many customers may not have been in a
23 position twenty or thirty years ago to construct, own,
24 operate, and maintain electrical facilities when they
25 were first starting out
L44 KLINE, REB 4rdaho Power company
1 Therefore, the company agreed to take on that risk by
2 providing the facilities charge service.
3 Q. what is your response to rcrP's
4 characterization that the company's facilities charge is
5 an "unfair business practice"?
6 e. r strongly disagree with this characterization.
7 Both Mr. sturtevantrs and rur. autler's statements in
8 their direct testimony seem to be based on the idea that
9 if rdaho power is not wi'lling to hand over ownership of
10 all facilities to simp]ot, this is somehow an unfair
11 business practice. r disagree and think it is
LZ unreasonab'le for them to expect rdaho Power to give away
13 faci'l i ti es that have va] ue
L4 r think of the facilities charge as similar to
15 a rental arrangement. rf r were to rent a house for 30
16 years, r would not reasonably expect the owner of the
L7 house to hand it over to me at the end of the 30 years
18 because r had "paid for it." tf t was to ask the owner
19 to sell it to me and helshe were wi'l1ing to do so, helshe
20 wou'ld requ'ire a fair price. therefore, r do not agree
2L with the characterization of the company's facilities
22 charge option as an unfa'ir business practice. As
23 explained by Mr. Youngblood, facilities charge customers
24 pay to the company an rdaho public ut'ilities
J.R.srMpt,orcoMpANy,sMorroNTorAKE eage 120
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
Page l0
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1205I1mrn,txtcommission-approved rate for providing this service.
145 KLINEI REB 4A
rdaho Power company
1 Q. what are the operationa'l and safety issues
2 associated with mixed orvnership at locations where both
3 the company and the customer own facilities beyond the
4 point of delivery?
5 A. Mixed ownership presents cha'llenges for the
6 company. rf there is not an "end po'int" that makes it
7 very c'lear where rdaho Power's faci'lities end and a
8 customer's facil'it'ies begin, it creates confusion during
9 an outage and in maintenance situations regarding who is
10 responsib'le for.working on what pieces of equipment. rt
11 also creates a safety issue for company personnel who may
LZ not know what a customer or a contractor for the customer
13 has been doing when working on the equipment. rn
a4 addition, there are diflEerences between the ruational
15 electric Safety code that rdaho Pourer fo'l'lows and the
16 Nationa'l electric Code that the customeris required to
L7 follow. These differences can result in equ'ipment that
18 is nonstandard for ldaho Power and its employees may not
19 be trained to safe'ly operate or work on this equipment.
20 a. ts it not true that the company currently has
2L some mixed-ownership locat{ons?
22 A. Yes.
23 q. How is the company proposing to handle these
24 existing mixed-ownersh'ip locations?
25
KLINE, REB 6rdaho Power Company
i)
L46
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
page 121 Pege I I
12051Imrn. txt
1 A. rn the early days of facilfties charges, the
2 company did provide its customers with a configuration
3 that sometimes al'lowed mixed-ownership faci'lities
4 installations. rn the late 1980s, the company made the
5 decision to no longer allouv mixed ownership for new
6 faci'lities charge installations. rhe company is not
7 requiring existing customers with mixed-ownership
8 'locations to make any changes at this time, However,
9 over time as opportunities arise, the company will be
10 looking for ways to address this issue at those specific
11 locations where mixed ownership exists.
L2 a. Does the Company currently grant new customer
13 requests for mixed-ownership installations?
t4 A. No.
15 a. what are the operationa'l and safety issues
16 associated with the company doing maintenance on
a7 facilities owned by customers beyond the company's point
18 of delivery?
19 A. rdaho Power personne'l are trained on the types
20 of equipment that the company dep'loys throughout its
2L system. customers may elect to install different types
22 or brands of equipment that the company's personnel have
23 never worked on or been trained to work on. rhe result
24 wou'ld be that company personnel may not be properly
25 trained to maintain the customer's equipment. rn
L47 KLINE, REB 7rdaho Power company
1 addition, the company may be asked to
2 customer
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J. R. srMp,-or coMpANy's MorroN To rAKf, eage L22
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
maintain a piece of
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148 KLINE, REB 7
rdaho Power company
1 equipment that has previous'ly been mainta'ined by a
2 third-party contractor. railing to have the full
3 maintenance history on a piece of equipment can create
4 safety issues for rdaho Power's personnel. At times,
5 rdaho Powerrs crews are cal'led to an outage in difficult
6 condit'ions (e.9., midd'le of the night, severe weather,
J.R.sIMpLorcoMpANy'sMorIoNTorAKE eage 123 Pagel3
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
12051tunrn . txt
7 etc.). when the company arrives on the scene of an
8 outage, its personnel are often under pressure to get the
9 service restored as soon as possible. compound these
10 high stress external circumstances with the fact that the
11 company personne'l may not be properly trained or have the
LZ maintenance history of a piece of customer-owned
13 equipment and the operational and safety concerns are
L4 exacerbated.
15 A, can you provide some specific safety concerns
16 of company personnel doing maintenance on customer-owned
L7 equipment?
18 A. Yes. rn addition to the training and
19 maintenance history information mentioned above,
20 customer-orvned facilities many times involve underground
21, cabling that may not be properly mapped. company
22 personnel may not be trained on the equipment and may not
23 know how the equipment was installed or maintained
24 because other people have been working on it. these
25 safety concerns are minimized when rdaho Power owns andmaintlins the equipment' 149 ,r"ft'I5ni"rrEoro"ni
1 Q. Does the Company have any agreements where it
2 does maintenance only of customer-owned facilities?
3 A. Yes. similar to the mixed use issue, there are
4 a handful of situat'ions where, for historical and other
5 operational reasons, the company has agreed to maintain
5 facilities owned by custemers. rhis is not the 'line of
7 business the company is in and it is migrating away from
8 this type of work. the company is migrating away from
9 this line of work over time to give its customers the
10 opportunity to find qualified electrical contractors that
J. R. srMpI.or coMpANy's MorIoN To rAKE rage 124 Pege 14
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
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12051lmrn . txt
11 wi'll be ab'le to adequate'ly perform the services for these
LZ customers. However, on a go'ing forward basis, the
13 company is in the process of communicating to its
L4 customers that it will not provide maintenance on
15 customer-oruned faci'lities.
16 a. ouring the course of this proceeding, has the
L7 company changed its position on the sale of faci1ities
18 subject to the faci'lities charge?
A. Yes. Simplot has expressed to Idaho porrrer its
strong desire to have an option whereby it can acquire
company-owned facilities that are subject to the
facilities charge. rhe company has listened to this
desire and is responding by providing Simplot the option
to purchase company-owned facilities. Mr. youngblood's
25 testimony describes this option in more detai'I.
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r/KLINE, REB 8Ardaho Power company
1 A. why is the company changing its position with
2 regard to ownership of facilities subject to the
3 facilit'ies charge?
4 A. As the vice President of customer operations,
5 one of my primary ro'les is to make sure rdaho Power is
6 providing exceptional customer service, to the best of
7 its ability, to its customers, simplot has made it very
I clear that it wants an opt'ion to own facilities currently
9 subject to the facilities charge. As a general rule,
10 rdaho power is not in the business of sel]ing company
11 owned facilities. For example, rdaho Power wou'ld never
LZ agree to sel'l a distribution line to a resident'ial
13 customer, but facilities charges are different. As r
L4 described ear'lier in my test'imony, initially, faci'lities
J. R. sIMpLor coMpANy's MorroN ro rAKE rage 12 5
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
12051lmrn . txt
15 charge customers have a choice-they can make the
16 investment and decision to insta]l, operate, and maintain
L7 faci'lities or they can ask the company to perform this
18 service. From a customer service standpoint, the company
19 can understand simplot's position and it is now providing
20 Simplot with the option to buyout Company-owned
2L faci'li ti es.
ZZ a. Does this conclude your testimony?
23 A. Yes.
24
25
151 KLINE, REB ].0rdaho Power company
(rhe following proceedings were had in
open hearing.)
MR. WILLIAI4S: the witness is now
avai lable for cross-examination.
CoMMISSTONER SMITH: rhank you. Mr. Otto,
do you have questions?
MR. OTTO: t do not, Madam chair.
coMMrssroNER sMrrH: Mr. eurdy, do you
have questions?
MR. PURDY: ruo, thank you.
COMMISSIONER SMITH: MT. OIseN.
MR. OLSEN : No, t,tadam Chai r.
COIIIMISSIONER SMITH: Mr. uowell.
MR. KLErN: Mr. rlein and we don't.
coMMrssroNER sMrrH: wou'ld you have
questi ons?
MR.KLEIN: NO.
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
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Exhibit 5
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120511mrn. txt
coMMrssroNER sMrrH: All right. Let's
see, r'm going to strike out soon. Mr. Mil]er?
MR. MTLLER: Over at the silent table
we']l stay silent.
CoMMISSIONER SMITH: okay.
MS. KYLER: No questions.
coMMrssroNER SMITH: No questions. WeIl,
we're back to you, Mr. nichardson.
CSB REFORTING L52(208) 890-s198
KLINErdaho Power company
,,1
1 MR. RTCHARDSoN: Thank you, l,tadam Chair.
2 I do have a couple of questions.
3
4 CROSS-EXAI.IINATION
5
6 BY MR. RTCHARDSON:
7 a cood morning, Mr. rline. r'm Peter
8 Richardson. I represent the tndustrial customers of
9 rdaho Power. what are your responsibilities as -- what's
10 your title again?
11 A r'm vice president of customer
L2 operations.
13 a And overa11, what are your
L4 responsibilities as vice president?
15 A yes, my primary responsib'ilities are r
16 have the organization that directly provides service,
L7 direct services to the customer, so from the time the
1E customer calls us through the cal'l center to the time
19 that something needs to be physically done out in the
20 fie]d, those folks out there, such as linemen and
2L troublemen and such, all of those people report within
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Exhibit 5
Page 17
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22 the same organization, that's customer operations.
23 a Do you believe that a'11 of your facilities
24 charge customers fu11y understand the terms and
25 conditions of the facilities charge service?
CSB REPORTTNG(208) 890-5198
1s3 KLINErdaho Power company
L A I would believe that they shou'ld
2 understand what those services are based on the fact that
3 it's described both in our ru'les that are approved by
4 this commission and also within the tariffs that are
5 approved by the commission.
6 a Let me ask it in a litt1e different way.
7 Do you be'lieve that rdaho Power has done all that it
I should do or could do to ensure that its facilities
9 charge customers fu'lly understand the terms and
10 conditions of the faci'lities charge?
11 A r've been in this part bf the bus'iness for
LZ a long time and t do understand that there's a'lways room
13 for tmprovement in terms of communicating with our
L4 customers and we can always look for other ways based on
15 the comments that we're getting back from our customers
16 that we can fmprove that, and t am aware certainly in the
L7 testimony of the witness ur. youngblood, he has in his
18 testimony described some other kinds of things that we
19 can do in terms of communicating with our customers
20 regarding facilities charges.
2L a On page 5 of your rebuttal testimony, you
22 state that, "other than the J. R. simplot company, none
23 of the Company's other approximate'ly 240 facil'ities
24 charge customers in rdaho have formally requested a
25 buyout option in recent memory." Do you see that?
J. R srMpl.or coMpANy's MorroN To rAKE Page 128 Page 18
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Exhibit 5
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CSB REPORTING(208) 890-s1e8
154
1 a Yes.
2 Q oid you read mr. But'ler and t,lr.
3 Sturtevant's testimony on behalf of the Industrial
4 Customers?
5 A rdid.
6 a and they're with the :. R. simplot
7 Company; correct?
I A Yes.
9 e rsn't it true that they did not recormend
10 a buyout option, but rather stated that they have already
11 paid for their facilities, and in the case of Mr. Butler
L2 at the oon plant in Pocatello paid for them over three
13 times over, and in the case of Mr. sturtevant for simplot
L4 as a whole also paid for them over three times over; in
15 other words, they aren't asking for a buyout option
16 because they believe they have bought and paid for these
L7 facilities and rdaho power ought to turn title over to
18 them; correct?
19 A I'that r'm aware of, r've read the
20 testimony, r'm also aware of at least conversations I did
2L not have, but conversations between the Company and the
22 l. R. Simplot Company and r was under the impression that
23 they had truly asked for an option to buy those
24 faci'li ti es.
25 a But isn't their -- r won't put their words
CSB REPORTING 155 KLINE (X)[phone] rdaho Power company
12051Imrn . txt
KLINE (X)
rdaho Power company
oT
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICEAND/OR OFFER INTO EVIDENCE
Exhibit 5
eage 129 Page 19
1205llmrn. txt
1 in your mouth, so I'll move on to the next question.
2 stil'l on page 5 at'line 15, you observe that simp'lot may
3 be unique, tf not in a very small minority of customers,
4 who now desires to extend the financia'l capital and has
5 the expertise to operate and maintain its own electrica'l
6 faci'lities. Nffi, when you characterize simplot as being
7 in a small minority of customers, you don't mean to imply
8 that they're a sma'l1 customer, do you?
9 A No. What I'm trying to say there is that
10 knowing the J. R. simplot company and its facilities and
11 the size of the faci'lities and the fact that they have
L?. fo'lks on site and a'lso available to contract with that.
13 they probably or could have peop'le that are capable of
L4 maintain'ing and operating those type of faci'lities.
15 There's a number of our customers that may not be able to
16 have the ab'i1ity to take care of their facilities.
L7 a Rnd simplot is your second largest retail
18 customer, isn't it?
19 A r don't know'if it's the second'largest.
20 It's one of our larger customers.
2L a Rnd they're the s'ingle largest facilities
22 customer on your system, correct, facilities charge
23 customer; 'is that correct?
24 A r don't know that.
25 A and have other companies contacted rdaho
156
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CSB REPORTING(208) 890-s198
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
KLINE (X)
Idaho Power company
not aware of complaints regarding the
eage 130
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power to, if you will, complain about the faci'lities
charge?
A I,M
Page 20
L20511mrn . txt4 facilities charge.
5 MR. RTcHARDSoN: madam chair, may r
6 approach the witness?
7 CoMMISSTONER SMITH: You may.
E (Mr. Richardson approached the witness.)
9 MR. RTCHARDSoN : Madam chai r , r 'llt handi ng
10 the witness a document that r would 'like marked as
11 Exhibit 308. rhis was filed --
LZ COMMISSIONER SMITH: I believe we already
13 have a 308, Mr. nichardson. Maybe we shou'ld try 309.
t4 MR. RTCHARDSoN: exhibit 309.
L5 (rcrp exhibit No. 309 was marked for
16 identification.)
Ll a BY MR..RICHARDSON: rhis was filed with
18 the commission on rriday by eoise state un'iversity. t
19 wonder if you wou'ld read for me --
20 MR. wTLLTAMS: tvradam chair, can r just
2L interrupt?
22 C0{MISSIONER SMITH: You may.
23 MR. WILLIAMS: r just want to be clear, is
24 Mr. Richardson suggesting that he's representing goise
25 State University or that goise state university is a
CSB REPORTING(208) 890-s198
L57 KLINE (X)
rdaho Power company
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member of the rcrP?
rtladam chai r.
Mr. Kline is
recei ved?
COMMISSIONER SMITH: Mr. Nichardson.
MR. RTcHARDSoN: r never said either,
COI"IMISSIONER SMITH: SO YOUT qUEStiON tO
do you know about this letter that we just
J. R SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
eage 131 Page 2l
120511mrn. txtI uR. RTCHARDSON: That's correct, Madam
9 chai r.
10 THE WITNESS: NO.
11 MR. RTCHARDSoN: I'.l1 represent that it
LZ was filed wfth the commission secretary on rriday.
13 MR. wrLLrAlts: tuadam chair, if my witness
L4 is going to be asked questions regarding this letter, r
15 ask that he have ample opportunity to review it. rt's
16 two pages long and it looks like it's got some pretty
L7 detailed information in it.
18 coMMrssroNER sMrrH: Actual'ly, r
19 apo'logize, ur. nichardson, for having to 'interrupt your
20 cross-exam, but r have a noon conference ca'll, so r think
2L we need to break for lunch right now and come back at
ZZ 1:15 which wil] allow the witness time to read the letter
23 and then we can resume with cross and r apologize.
24 MR. RICHARDSoN: thank you, Madam chair.
25 COMMISSIONER SMfTH: We're at recess until
CSB REPORTING 158 KLINE (X)[phone] rdaho Power company
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Exhibit 5
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CSB REFORTING 159 KLINE (X)(208) 890-519E rdaho Power conipany
J.R"sIMpLorcoMpANy'sMorIoNTorAKE nage 133 Prgc23
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Erhibit 5
120511afn. txt
1 BOTSE, TDAHO, MONDAY, DECEMBER 5, 2011, 1:15 p. M.
2
3
4 CoMMISSToNER sMrTH: Thank you, 'ladies and
5 gentlemen. r hope you're all refreshed from your noon
6 hour break. tue yuere having questions from ttr.
7 Richardson. tlrle lost our witness, Mr. Kline, so
8 l,tr. Richardson, it's back to you.
9 uR. RICHARDSoN: rhank you, Madam
10 chai rman.
11
L2 WARREN KIINE,
13 produced as a witness at the instance of the rdaho Power
L4 company, having been previously duly sworn, resumed the
L5 stand and was further examined and testified as follows:
16
L7 CROSS-EXAUINATION
18
19 BY MR. RICHARDSON: (Continued)
20 a Mr. Kline, we were before the lunch break
ZL discussing your testimony at page 5 at line 15 where you
22 state that r be'lieve simplot maybe unique, if not in a
23 very small minority of customers in terms of their
24 concerns about the facilities charge and t had just
25 handed you what what was marked 409 --
CSB REFORTING(208) 890-5198
KLINE (X)
Idaho Power Company
159
J. R. SIMPLOT COMPANY'S MOTION TOTAKE eaga 1
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Exhibit 5
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CoMMISSIoNER SMITH: 309.
MR. RTCHARDSON: 309, thank you, Madam
Chai rman.
a BY MR. RTCHARDSoN: -- which is a'letter
from goise State university filed on Friday in this
docket and r was asking you if you wou'ld read for the
record the last two paragraphs of that letter.
A "rt is the univers'ity's position that the
facilities charge at issue is excessive and lacks
justification when applied to older equipment. Both the
current charge C20.4%) and proposed revised charge
(L6.97%) are excessive and more ref'lective of a consumer
credit card rate of interest than a reasonab'le commercial
finance charge. For example, were Boise State university
to initiate a bond issuance for the construction of new
facilities at the present time, it cou'ld do so at an
interest rate of approximately 4.25%. Moreover, the
charge is assessed in perpetuity, regardless of the
depreciated value of the asset assessed, or its age. As
a result, cumulative facilities charges assessed by rdaho
power against the equipment on eoise state university's
campus have more than doub'led the cumulative total of
rdaho power' s i ni ti'a'l i nvestment i n the equi pment
($604,150.81 in initia'l investments; $1,443,774.31 in
facilities charges assessed). on older transformers,
CSB REFORTING(208) 890-s198
160 KLINE (X)
fdaho Power Company
1 th'is discrepancy is even greater. rn the case of the
2 L947 transformer, facility charges assessed over the 'last
3 64 years have exceeded rdaho Power's investment by more
4 than 13 times ($725.35 initial investment; $9,470.17 in
J.R,sIMpLorcoMpANy'sMorIoNTorAKE Page 2 Page25
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
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120511afn. txt
5 cumulative faci'lity charges, with no forseeable end in
6 sight).
7 Boise state university therefore concurs
8 with the tndustrial customers of tdaho's recommendation
9 for a reasonab'le, reduced facilities charge, adjusted to
10 reflect the age and depreciated va'lue of the equipment at
11 issue, and that customers be provided the option to own
LZ or purchase faci'lities charge equipment based on a fair
13 ca'lculation of the depreciated book va]ue of the assets."
L4 a rhank you, Mr. t<line, and were you here in
15 the xearing Room this morning when the public witness
16 from McCain spoke?
Ll A I was.
18 a were you?
19 A Yes.
20 a so do you still believe that Simplot is in
27 a very small minority or in fact unique when it comes to
22 concerns about the facilities charge?
23 A we1], we have several hundred customers
24 that are on the facilities charge and t'm unaware of very
25 many of them, with the exception of what r just read and
CSB REPORTING(208) 890-s1e8
KLINE (X)
Idaho Power company
1 those of those customers like simplot that are part of
2 the tndustrial customers of rdaho, that's the ones rrm
3 aware of.
4 a nnd they wou'ld in all likelihood be
5 representative of the facilities charge customers who
6 comprise the bulk of the facilities charges you recover,
7 wouldn't they?
I A rdon'tknow.
J. R. SIMPLOT COMPANY'S MOTION TO TAKE eage 3
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
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Exhibit 5
1205I1afn . txt
a You state on page 6 of your testimony,
beginn'ing on line 6, that you strong'ly disagree with r'lr.
Sturtevant and l,,tr. Butler that the facilities charge
constitutes an unfair business practice. Well, wouldn't
you agree that fairness is large]y in the eye of the
beho'lder?
A r believe fairness would be according to
those parties that are involved in valu'ing a particular
service or an asset.
a md ultimately isn't it for this
to decide what is fair and what isn't fair?
A Yes. As r stated under that question, it
6 and t stated that -- Iet's see, r talked
fact that the commission had approved this
approved this rate in the past.
a well, do you think it is fair
povuer to charge simp'lot a faci'lities charge
CSB REPORTING(208) 890-s1e8
L62 KLINE (X)
Idaho Power company
transformer that was installed in 1945 that's 66 years
ol d?
A r believe that one must consider the
service that we're provid'ing. hte are providing a service
in addition to just supplying the equipment and thai
charge encompasses all of those services. Now, rdaho
power provides this at the request of the customer and we
pay the -- we cover the upfront costs of both the
engineering and the design of those facilities and also
buy the equipment.
for rdaho
ona
addition to that, we know that our
this equ'ipment to run their p'lants and
eage 4 prge27
12051lafn. txt
13 they've got to have 24-hour/7-day service, so in addition
t4 to that, we cover the inventory that's made availab]e at
15 any time of the day that these customers may need some
16 equ'ipment repair. rn addition to that, we prov'ide
L7 ongoing 24-hour/7 service by our folks. rf it's during
18 the day, if something breaks down, we've got people
19 available, but we've got people on call 24 hours a day,
20 seven days a week, 365 days a year to provide emergency
2L response services.
2?, rn addition to that, we have mechanisms in
23 place so that we've got our dispatch center staffed 24
24 hours a day so that they can get the information and a'lso
25 get crews d'ispatched out and, of course, like I say, we
CSB REPORTING(208) 890-5198
163 KLrNE (x)
rdaho Power Company
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have crews, we have stations techs, we have troublemen
that are always available to respond and get them back in
service and that's what this charge is covering and r
think it's very fair.
a Let me ask the question a little bit
differently. rhis particular transformer is 66 years old
and in your facilit'ies charge, it comprises of severa'l
'line items. wou'ld you believe that it's fair for rdaho
power to charge a rate of return charge on a 66-year-o1d
transformer, for you to continue to earn a return on that
investment for 66 years?
r would 'like to refer you to my testimony
it talks about, and l''ll cover the
issues are you not discussing in your
L3 on page 1 and
L4 question, what
15 rebuttal testimony, it says, "r am not testifying about
16 any tariff language, the appropriate rate or methodology
J. R. SIMPLOT COMPANY'S MOTION TO TAKE eage 5 Page 28
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Exhibit 5
1205l1afn. txt
t7 for the facilities charge buyout, or any other regu'latory
18 or ratemaking matters. company witness Mr. scott sparks
L9 wil'l testify regarding the facilities charge rate
20 methodology and company witness ur. uichae1 voungb'lood
2L will testify regarding the facilities charge buyout
22 option as wel1 as the regu'latory and ratemaking issues
23 associated with facilities charges."
24 a So you're saying you're not the witness
25 who can testify as to the fairness of that question?
164 KLrNE (x)
Idaho Power company
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CSB REPORTING(208) 890-s198
1 A r'm here to talk about the service that we
2 provide customers. tn fact, r will refer you to page 1
3 of my testimony, what is the purpose of your rebuttal
4 testimony,'it says, "r wi'll describe rdaho power's
5 facilities charge service option from a customer service
6 standpoint, particularly some of the issues associated
7 with mixed ownership of faci'lities and with company
8 personne'l maintaining customer-orvned facilities. r will
9 also respond to the characterization made by the
10 rndustrial customers of tdaho Power that the company's
11 faci'lities charge option is an unfair business practice."
a2 a Do you keep a log of how often you're
13 ca'l'led to provide these emergency serv'ices for faci'lities
L4 charge customers?
A t don't keep a 1og.
a You don't, know how often you've had to
L7 provide these services?
18 A r believe that we could go back and look
19 at the service orders that we got from those ca'l'ls from
20 those customers and probably come up with close to what
J. R. srMpLoT CoMpANy,s MoTIoN To rAKE eage 6 page 29
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
12051lafn. txt
2L we have covered.
22 a vou heard nar. campbell this morning state
23 that in over a decade at Mccain that they have never once
24 needed the services that you say you're providing?
25 A r heard him state that.
CSB REPORTING 165(208) 890-s198
tr)
1 Q Rnd you don't keep a 'log, so you don't
2 know how often you need to provide these services for
3 0ther customers?
4 A could you restate your question?
5 Q You said you didn't keep a 1og of when and
6 how often you provide these services?
7 A rsaidrdon'tkeepalog.
8 Q But you're the witness test'ifying about
9 providing these services; right?
10 A Yes,ram.
11 q okay; so you didn't invest'igate to prepare
LZ for your testimony how often these services are used?
A r did not.
a nnd you're not here to testify about how
15 they're valued or priced?
KLINE (X)
Idaho Power company
A No.
a You use an analogy, and r be1ieve it's
18 still there on page 6, yes, of a house rental situation
19 by stating, "rf r were to rent a house for 30 years, r
2A would not reasonably expect the owner of the house to
2L hand it over to me at the end of the 30 years because t
22 had 'paid for it. "' Do you see that?
13
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J. R. SIMPLOT CoMPANY'S MOTION TO TAKE Page 7OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit S
A Yes, I dg.
a Now, when you rent a house, is it
Page 30
120511afn. txt
25 reasonable for the owner to te'|1 you up front what the
CSB REPORTING 156 KLINE (X)
[phone] Idaho Power company
1 rent 'is goi ng to be?
2 A Yes.
3 a when you rent a house, is it reasonable
4 for you to have something up front in writing documenting
5 what all the costs are going to be?
6 A what do you mean by "aI1 the costs"?
7 Q what is it going to cost you to rent the
8 house.
9 I r agree with that, y€s.
10 a lnd when you rent a house, do you actually
11 have a choice of who you can rent it from?
L2 A IdO.
13 a Rnd when you rent a house, do you have the
L4 choice to move out and rent a different hourse if you're
15 not satisfied with the current rental situation?
16 A Yes.
L7 a md when you rent a house, do you have the
18 option to buy one 'instead of renting?
19 A t have the option to buy perhaps not that
20 house but a different house.
2L a Now, when rdaho Po{er installs, say, a new
22 turbine at the xe'l1s canyon Dam, do you think it's fair
23 for this Commission to allow rdaho Pou,er to put the cost
24 of that turbine into rates and to earn a return, a11ow
25 fdaho Power to earn a return on it?
CSB REPORTING L67 KLINE (X)[phone] rdaho Power company
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J.R.5rMpLSTCOMpANy'SMOTI6NTSTAKE eage 8 Prgc3l
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
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A YES.
a And it's fair for this comission to set
retail rates such that rdaho Power can collect that
return from its ratepayers; correct?
A YES.
a and it's also fair for the ratepayers,
isn't it, to require rdaho power to depreciate the cost
of that turbine over its useful life?
A YES.
a md it would not be fair to the
ratepayers, would it, if the cost of that turbine were
never depreciated for purposes of setting rates?
A NO.
a So when that turbine is ful'ly deprec'iated
out, who has the claim to any residual value of that
turbine? Do the shareholders own it or do the ratepayers
own it?
MR. wrLLrAMs: madam chair, r'flI going to
object to that question. rt ca'l'ls for a 1ega1
conclusion. r'm a'lso concerned that this testimony or
the questions Mr. nichardson are asking, which r've let
him go on a little while, are gett'ing into the ratemaking
and regulatory issues which the witness has specifically
said he's not testifying to here today.
COfIIMISSIoNER SMITH : Mr. R'i chardson .
CSB REPORTING(208) 890-s198
168 rlrue (x)
Idaho Power Company
MR. RICHARDSON:
stand, Madam Chairman.
t'l'l let the question
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OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
1 20511afn. txt
COMMISSIoNER SMITH: Thank you.
BY MR. RICHARDSON: On page 7, you discuss
mixed facilities.
A YES.
a nnd you point out there are differences in
the National Electric Safety code that rdaho pou,er
follows and the National Electric safety code that the
consumer is required to follovu. Do you see that?
A r pointed it out, but I don't think you
stated 'it correct'ly, sir.
a would you correct me, then?
A Yes. r said that 'in addition, there are
differences between the trtationa'l rlectric safety code
that rdaho Power fo'llows and the National electric code
that the customer is required to follow.
a you're not suggesting, are you, that the
J. R. simplot company doesn't have to comp-ly with the
same National e]ectric Code that rdaho Power has to
comply with?
A the company has to comply with the
National Electric safety Code. rhe :. n. Simplot Company
has to comply with the ttationa1 e'lectric code.
O Yourre not testifying today as an
CSB REPORTTNG(208) 890-s198 169 KLrNE (x)
rdaho Power company
electrical eng'ineer, are you?
A No, I am not.
a end have you read Mr. sturtevant's
testimony where he states that the simplot-caldwel'l p'lant
has had mixed facilities s'ince 1945 with no incident?
A t have read the testimony.
eage 10 Page 33
120511afn. txt7 e Rnd do you know that Mr. sturtevant is an
I engineer?
9 A Yes.
10 a At page 10 of your testimony, you note
lL that during the course of this proceeding, the company
L2 has changed its position on the sale of facilities
L3 subject to the facilities charge. Do you see that?
L4 A YEs.
15 a when did that change occur?
16 A wel'I, it says "during the course of this
L7 proceeding," so it's just the 'last couple of months.
18 a rs there a specific document that the
19 company prepared expressing this new pol'icy that r could
20 look at?
2l A No.
22 a xow do you know the company has changed
23 i ts pos'ition?
Because r was part of the discussion to
that change.
KLINE (X)
Idaho Power Company
:)
A
decide to make
CSB REPORTING(208) 890-s198
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
24
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1 Q and explain to me how that came about
2 interna'lly with the Company. what process did you follow
3 to decide to change your position on ownersh'ip?
4 MR. wrLLrAMs : l,tadam cha'i r , I 'm goi ng to
5 object on relevance. rhe fact of the matter is the
6 Company is proposing a new buyout option in its tariff.
7 How the company got there or why or the process used, r
8 don't see the relevance in that for this proceeding.
I coMMrssroNER sMfTH: Mr. Richardson.
10 MR. RICHARDSoN: I''l'l change di recti ons a
page lL
120511afn. txt11 litt'le, Madam chair.
72 COMMISSIoNER SMITH: Thank you.
13 a BY MR. RICHARDSoN: Do you know how long
L4 the simplot company has been trying to get at least that
15 much of a concession from rdaho power?
16 A I do not knotr how 'long.
L7 q es vice president of customer operations,
18 do you think it is good customer re'lations to force the
19 l. R. simplot Company to expend the time and expense of
20 participating in this proceeding to get rdaho Po$,er to
2L make that one sma'l'l concession?
22 MR. wrLLrAMs: lttadam chai r, r'm goi ng to
23 object. that's argumentative.
24 C(n'IMTSSIoNER SMITH: Mr. nichardson, I
25 believe he's correct.
CSB REPORTING L7T KLINE (X)[phone] rdaho Pou,er company
1 MR. RTCHARDSON: I'11 withdraw the
2 question, Madam Chair, and that's all my questions for
3 this witness.
4 COI,IMISSIONER SMITH: Thank you. r hope r
5 haven't 'lost track, r think that was everyone who had the
6 opportunity. Are there questions from the commission?
7 co4MrssroNER REDFoRD: Just one question
8 or two.
9
10 EXAI4INATION
11
L2 BY COIVIIT4ISSIONER REDFORD:
13 q Do you keep an equipment 1og for a'11
L4 pieces of equ'ipment other than maybe small tools for
J. R. srMpI-or coMpANy's MorroN To rAKE Rage 12 Pagc 35
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
\I
i
120511afn. txt15 rdaho Power?
16 A rn terms of, 'like, the equipment that
LT we've been discussing, commissioner, you know, the large
18 p'ieces of equi pment?
19 a wel'|, r would suggest that it's
20 operat'ional equipment. r don't expect you to keep a 1og
21 on a hammer.
22 A Yes, we do keep a 1og.
23 A and does it have several co'lumns on it, in
24 the 1og?
25 A r would say that it would.
CSB REFORTTNG(208) 890-s198
L72 KLINE (com)
rdaho Power company
A erobably has an acqu'isition date?
A YES.
a tt would have an acquisition cost?
A YES.
a rt would have a maintenance 1og?
A YES.
q cost of the maintenance?
A YES.
a so when you previously testified that you
10 don't have that information, you may not have it with you
11 today, but you have that information?
A YCS.
a So if you had a generator or some piece of
t4 equfpment that went into s'implot in 1959 or whatever it
15 is, that log would continue on each year?
A Right.
L7 a And it would be used for purposes of
18 deprec'iation and other th'ings, so don't you have that
J.R.srMpLorcoMpANy'sMorroNTorAKE eage 13
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
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120511afn. txt19 information readily avai'lable to you?
20 A we should be able to get it, yes.
2L a could you make that available to us,
22 please?
23 A Yes.
24 a lnd presumably, that wou'ld merely be a
25 question of mathematics, that it would demonstrate how
CSB REPORTING(208) 890-s1e8
L73 KLINE (COM)
rdaho Power company
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much you have into it, how much it costs to maintain it,
how much it costs to replace it and so on?
A YCS.
a so the difference there would demonstrate
how much revenue, maybe not cost but revenue, that you
have into that p'iece of equipment, so that would pretty
well tell the whole stery, wouldn't it?
A rt would give you a good picture of it.
a when could we expect that?
MR. wrLLrAMs: ttadam chair, commissioner
nedford, the amount of information that you're talking
about is incredibly voluminous. there are, r think, a
couple thousand different pieces of individual equipment.
r can talk to Mr. K'line. we can try to figure something
out.
coMMTSSIONER REDFORD: we'l'I, you
certainly have a summary, and you have column adds and
subtracts.
MR. WILLIAMS: fo be honest, f don't
real'ly know. r'd have to talk to some of our regulatory
and finance people.
cs4[4rssroNER REDFoRD: tt doesn't seem
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
f,xhibit 5
Page 14 Prge 37
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120511afn. txt
reasonable to me that you wou1d simply every time your
tax peop'le would want to do a depreciation calculation
that they'd have to go through 2,000 pages of documents.
CSB REPORTING L74 KLINE (COM)[phone] rdaho Power company
1 MR. WILLTAMS: r don't know.
2 COiIMISSIONER REDFORD: So you can get
3 that information when?
4 MR. WTLLTAMS: r would need to discuss
5 with our regu'latory and finance people to see if we could
6 get it and give you a timeline.
7 C$,IMISSIONER REDFORD: R WECK?
I MR. I,{ILLIAMS: r don't know.
9 COMMISSIONER SMITH: r think you just
10 could te'l'l us maybe tomorrow when you can provide that.
11 MR. wTLLTAMS: sur€, r will be ab'le to
tZ provide the answer tomorrow.
13 Co,IMISSIONER SMITH: thank you.
t4 a BY coMMISSIoNER REDFoRD: nnd T th.inK that
15 wou'ld g'ive us, you can correct me if r'm wrong, it would
16 give us some information of cost and all the other
L7 figures for that piece of equipment; would you agree?
18 A Yes, r think the information that we have
19 and looking back on what we've done with that equipment
20 and when we purchased it and the records that we would
2L have on providing any kind of maintenance --
22 coMMrssroNER REDFoRD: well, r might
23 suggest that r'm sure that it's avai'lable for tnternal
24 Revenue purposes, so that may be a start. rhank you. r
25 have no further questions.
KLINE (Com)
rdaho Power company
CSB REPORTING(208) 890-s198
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
L75
eage 15 Page 38
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1205I1afn. txt
COMMTSSIONER SMITH:
redi rect, lrtr. t,li I I i ams?
MR. WILLIAMS: ]USt
Do you have any
a couple, Madam Chair.
REDIRECT EXAI'IIMTION
BY MR. WILLIAMS:
a Mr. Kline, the letter from goise State
university that Mr. Richardson handed out, he indicated
it had been submitted to the commission in this docket.
Are you aware of whether it was submitted to the
company?
A r'm not aware that it was submitted. rhe
date of it is oecember 2nd and whether it was mailed to
us or not, I'm not aware of us receiving it at this point
in time.
a as the vice president of customer
operations, wou'ld you be made aware by major customer
service representatives whether or not the company's
Iargest customers have concerns or problems with their
servi ce?
A' r believe most of the time, yes, r
woul d.
a And as vice president of customer
you be wi11fn9 to agree to have theoperati ons , wou'ld
CSB REPORTING(208) 890-s198
KLINE (Di)
rdaho Power company
L76
1 Company's major account representatives meet with Mccain
J.R.STMpLOTCSMpANy'SMOTTONTOTAKE eage 16 pnge39
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
120511afn. txt
2 roods or BSU or simp'lot or any other large industria'l
3 customers to ta'lk about any concerns they have with their
4 service?
5 A Yes, we would.
6 MR. WILLIAMS: I have no further
7 questi ons , tttadam Chai r.
8 COIT,IMISSIONER SMITH: thank you. rhank
9 you, Mr. K'line.
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCEr Exhibit5
-
Page 40
EXHIBIT #6
J. R. SIMPLOT COMPANY'S MOTION TO
TAKE OFFICIAL NOTICE AND/OR OFFER
INTO EVIDENCE
L205l1afn. txt(208) 890-5198 rdaho Power company
1 EXAMINATION
2
3 av coMMIssroNER REDFoRD:
4 Q So you take a piece of equipment that has
5 no further va'lue but its scrap va1ue, do you sel'l it to a
6 scrap dealer?
7 A Yeah, we wou'ld get whatever value we could
8 out of that piece of equipment for scrap, yes.
9 a r thought you said that the ou,ner of the
10 equipment or simplot wou'ld get the value of that.
1L A we'l'|, in the charge that we wou'ld charge
LZ them for that -- r think if t understand correctly, you
13 described a removal, a customer-requested remova'|.
14 a well, assume that the thing goes to
L5 pieces.
16 A afa'ilure,then?
L7 a Yes.
18 A e fai'lure would work as r just described
19 to Mn. trttilliams.
20 CoMMISSIONER REDFoRDT t have no further
2L questions.
22 coMMrssroNER sMrrH: Thank you for your
23 he1p, Mr. Sparks.
24 (rhe witness left the stand.)
25 MR. wrLLrAMs: tvtadam chai r, at thi s ti me
csB REPORTTNG 236 SPARKS (Com)(208) 890-519E rdaho Power company
J. R, SIMPLOT COMPANY'S MOTION TO TAKE
OFFICI.AL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
eage 69
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1205l1afn. txt
rdaho power would ca'll nar. uichael :. voungb'lood to the
stand.
MICHAEL ]. YOUNGBLOOD,
produced as a witness at the instance of the tdaho Power
company, having been first duly su,orn, was examined and
testified as follows:
DIRECT D(AMINATION
BY MR. hIILLIAI'IS:
A Mr. Youngb'lood, please state your name,
spelling your last for the record.
A My name is tutichael :. voungblood. rhe
last name is spelled Y-o-u-n-g-b-1-o-o-d.
a By whom are you employed and in what
capacity?
A t am employed by rdaho Power company as
the manager of rate design.
a Are you the same lJlichae'l Youngblood that
filed rebuttal.testimony on november 16th, 2011, and
prepared exhibit tto. 52?
A Yes, I am.
A Do you have any corrections or changes to
make to your testimony or exhibits at this time?
CsB REPORTTNG(208) 890-s198
237 YoUNGBLooD (Di)
rdaho Power company
A I do not.
a rf r were to ask you here today under oath
the same questions set forth in your rebutta'l testimony,
would your answers be the same?
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
rage 70
Pege 2
120511afn. txt5 A Yes, they would.
6 rqR. wTLLTAMS: tvtadam chair, at this time t
7 move that the rebuttal testimony of uichae'l :. voungb'lood
8 be spread upon the record as if read, and that Exhibit
9 tto. 52 be marked for identification.
10 COMMISSIONER SMITH: Tf there is no
11 objection, it is so ordered.
L2 (rhe following prefiled rebuttal
13 testimony of rtlr. ruichae'l Youngblood is spread upon the
L4 record.)
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CSB REPORTING(208) 890-s198
YouNGBLooo (oi)
rdaho Power company
1
2 business
3 A.
a. Please state your name and
4 address is
5a.
6 submitted
7A,
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
My name is rtlichael :. Youngb'lood. my business
1221 tltest rdaho street, Boise, rdaho.
Are you the same michael voungblood that
direct testimony in this proceeding?
Yes, I am.
eage 71
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1205uafn. txta. what is the intent of your rebuttal testimony?
A. The intent of my rebutta'l testimony is to
provide rdaho Power Company's ("tdaho Power" or
"company") response to the pre-filed direct testlmony of
Dr. Don Reading, Mr. Don Sturtevant, and Mr. De] But'ler,
all witnesses for the tndustrial customers of rdaho power
("rcrP") .
a. What is the scope of your rebuttal testimony?
A. r wi'll respond to some of the allegations made
by the witnesses from rCIP regarding the calcu'lation and
18 allocation of facilities charges, as wel] as provide
testimony describing a neu/ tariff provision giving
customers the option to purchase company-owned equipment
installed beyond rdaho Power's point of delivery. rhe
'latter discussion is a d'irect response to requests made
by lrtr. sturtevant of the J.n. simplot company ("simp1ot")
who has an interest in purchasing company-owned
25 facilities.
CSB REPORTING(208) 8eo-s198
239 YOUNGBLOOD (Di)
Idaho Power company
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a. please describe the intent of the serviceorovided under a facilities charoe arranoement.' A. Rs described in more dEtail in-the nebuttal
testimony of ur. warren Kline, the faci'lities charge
service was origina'lly designed, and continues to
provide, a service primarily to our schedule 9, Large
Genera'l Service, and schedule 19, Large Power service
(primary and Transmission) service level customers by
provid'ing them an option whereby the company instalIs,
owns, operates, and maintains electric faci'lities beyond
the company's normal point of delivery. Because
facilities beyond the company's point of delivery are
J, R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
vage 72
120511afn. txtL2 solely for the purpose of meeting the electrica'l service
13 requirements of an individual customer, it is not
14 appropriate to charge any other customers for the
15 investment and maintenance of those facilities.
16 therefore, the facilities charge service was designed to
L7 provide a means to charge specific customers the
18 cost-of-service related to faci'lities beyond the point of
19 delivery which are installed, owned, operated, and
20 maintained by the company.
2L a. Please describe at a hjgh 'leve'l how the
22 company's facilities charge is calculated.
23 A. rhe tdaho public utilities comm'ission
24 ("commission") approved methodology for ca'lculating the
25 facilities charge is designed to provide a levelized rate
240
/o f
YOUNGBLOODI REB 1
rdaho Power company
of cost recovery from individual customers us'ing the samecost comoonents that are included for similar ficilities
under thb company's approved non-levelized determination
of the revenue requirement. rn short, the fac'ilities
charge is a levelized method for assigning costs, whereas
the cost-of-service approach is a point in time
methodo'logy of assigning costs on a non-leve'lized basis.
Both are intended to recover, on average, the same amount
of revenue over time.
a, How are the fac'ilities charge revenues treated
in the company's non-leve'lized determination of
class-specific base rate revenue requirements?
A. rn the Company's non-Ievelized determination of
class-specific base rate revenue requirements, the
company deterrnines the total revenue required for
recovery on all distribution facilities-related
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
nage 73
Page 5
12051lafn.txt16 investments, including facilities beyond the company's
L7 point of delivery, as wel1 as the associated operation
18 and maintenance expense and other administrative
19 expenses. rhis determination is made for each class of
20 customers. As part of this process, the revenues the
2L company receives from providing facilities charge
22 services are directly ass'igned as a revenue credit, or an
23 offset, to the revenue requirements of the associated
24 class of customers. As a result, any differences between
25 the non-levelized revenue requ'irement and the levelized
24L YOI'NGBLOOD, REB 2rdaho Power company
1 revenue requirement exist as intra-class subsidiesbetween those customers oavinq2 faci'lities charges and tho-se frho do not within each
3 customer class.
4 Q. please explain how the levelized revenue
5 recovery from the facilities charge methodology for an
6 individual schedu'le 19, Large Power service, customer
7 wou'ld recover the same revenue as a non-levelized
I methodology used for determining the revenue requirement
9 for the Schedule 19 customer class as a whole.
10 A. the chart below provides a pictoria'l
11 representation of the two cost recovery methodologies.
a2
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15 (chart contained in hard copy of transcript.)
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
eage 74
Pagc 6
1205l1afn. txt
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24 this chart shows an ever-decreasing revenue
25 requirement associated with plant investment that
242 YoUNGBLooD, REB 4
rdaho Power company
1 depreciates over time. rhe total amount of revenue
2 recovered from either mechanism is identica'|. rhe
3 difference is in the timing of the revenue recovery. rn
4 the ear'ly years, the levelized methodology does not
5 recover the ful'l revenue requirement needed, however, in
6 the later years, the levelized methodology provides more
7 than would be required under the non-1evelized approach.
I rt is important to note that the revenue requirement for
9 faci'lities charge customers is an estimate of cost the
10 company incurs to provide facilities beyond the company's
11 point of de'livery. this revenue requirement
L2 determination is on'ly used to offset the costs that are
13 already being co'llected through customers' rates, in this
L4 example schedu'le L9. with that said, regardless of the
15 amount of the facilities charge and the associated
16 revenue, the revenue offset treatment applied by the
L7 company ensures that rdaho Power only earns its allowed
LB rate of return on aI1 non-depreciated plant balances,
19 including facilities beyond the point of delivery.
20 C. How is this example applicable to the
2l determination of the facilities charge?
22 A. tt would be very comp'licated and not practical
23 to determine an individua'l revenue requirement for each
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
--
Page 75
Page 7
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1205Llafn. txtand every customer who has facilities beyond the
company's point of delivery. rf the company wou'ld take243 l31il3'bffi3r 85fi*,i
1 that approach, as suggested by the tctp witnesses, not
2 only would the calcu'lated facilities charge service rate
3 be different for each of the approximately 24A faci'lities
4 charge customers the company current'ly maintains in
5 ldaho, but the rate would continually change for each of
6 those customers. rn addition, when the Company's
7 investment in facilities changed due to replacement of
8 failed facilities, the individua'l's rate could change
9 again significantly, depending on their position in time
10 along the curve with regard to the recovery of
11 investment.
LZ a. rf the commission were to adopt rCrp's
13 recommendation for determining an individual facilities
L4 charge rate for each facilities charge customer, wou'ld
15 there be an effect to the remaining customers in the
16 class?
t7 A. Yes. ls shown in the chart above, when the
18 levelized facilities charge recovery is 'less than the
19 non-levelized rate, the amount of revenue requirement
20 shortfall for the individual facilities charge customer
2l is being subsidized by the remainder of the c'lass. rn
22 the later years, when the levelized facilities charge is
23 greater than the necessary revenue requi rement at that
24 time, the facil'ities charge customer is paying back the
25 previous subsidy. these intra-c1ass subsidies are an244 l8lil8'i8fitsi lEfir*l
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J. R. SIMPLOT COMPANV'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
eage 76
Page 8
120511afn.txt
1 expected and normal outcome of the'levelized approach for
2 ratemaking. Because the facilities charge revenue is an
3 offset to the revenue requirement of that customer's
4 class, dny change in
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245 YOUNGBLOOD, REB 5rdaho Power company
1 the facilities charge for an individual customer wou'ldpage 77
J. R. sIMpLor coMpANy's MorIoN To rAKE Page 9
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
:)
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14 tracking
15 piece of
16 proposed
A.
1 individual facilities charge
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eage'78
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Erhibit 6
120511afn . txt
2 change the amount of the revenue credit being rece'ived as
an offset to the revenue requirement of the class. rhis
would require that a new revenue requirement determination
be made to adjust the base rates of the entire class.
Thus, to adopt the recommendation of tcIP, the Company
would be required to recalcu'late its revenue requirement
for each customer class that has the faci'lities charge any
time there is a change in the facifities charge rate for
an individual customer. An approach such as this would be
extremely complicated to administer and would require
continual changes to the base rates of the c'lass.
L7
18 facilities charge rate for each customer as r described
19 above, to track the actual depreciation levels for each
20 individual piece of equipment subject to a facilities
2L charge for ratemaking purposes wou'ld be even more
22 complicated. rhe imp'lication, as suggested by rcre
23 witness or. neading, would be to have a separate
24 facilities charge rate for each of the thousands of
25 individual pieces of equipment for each of the 240
246
what are the ratemaking issues associated with
actual deprec'iation leve'ls for each individual
equipment subject to the faci'lities charge, as
by rcIP?
while it is impractical to have an tndividua'l
YOUNGBLOOD, REB 6rdaho Pover company
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YOUNGBLOOD, REB 6Ardaho Power Company
customers in rdaho. under or. neading's approach, this
would mean that the company would be required to
determine its revenue requirement any time a single piece
of facilities charge eguipment depreciated. The end
result wou'ld be an administrative nightmare and undu'ly
burdensome for the company, as well as increasing the
complexity of the faci'lities charge rate.
a. Does the company track depreciation 'leve'ls for
Page 79
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
Page I I
12051lafn. txt
9 individua'l facilit'ies for any other customer class or
10 service?
11 A. No. It is a standard ratemaking pract'ice to
L2 average the actua'l leve'ls of depreciation together for a
13 particular level of service or customer class and spread
L4 the recovery of those costs equal'ly to all customers
15 within the class.
16 a. Does the Company believe that the facilities
L7 charges proposed in this proceeding are fair, just, and
18 reasonable?
19 A. Yes. the company's proposed facilities
20 charges in this proceeding were developed under the
2L methodology approved by this commission in prior
22 proceedings and wi'll result in charges to customers that
2l are fair, just, and reasonable.
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YOUNGBLOOD, REB 7Ardaho Power company
a. what is the company's response to rcrPrs
suggestion that the company should s'imp1y give away fu'lly
depreciated facilities to facilities charge customers?
A. even if the company were to consider this
proposition, which it is not, rcrP's proposa'l would not
be administratively feasible. As t have described above,
the company does not depreciate for ratemaking purposes
individual pieces of equ'ipment separately, so
determ"ination of when an individual piece of equipment
was ful1y depreciated wou'ld be nearly imposs'ible. rn
addition, "turn'ing over" specific pieces of equipment
which are "ful1y depreciated" while leav'ing p'ieces ofpage 80
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
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12051lafn. txt
equipment that are not "fully depreciated" would resu'lt
in mixed ownersh'ip of facilities, wirich is contrary to
the company's current policy because it creates
operationa'l and safety issues, as described by rur. rline.
rhe facilities charge has never been a "lease-to-own"
charge, such that a customer wou'ld pay an amount for a
number of years, and then have that piece of equipment
given to them at no cost. rnstead, the service provided
under a faci'lities charge arrangement is intended to
collect additiona'l revenue that is used to offset the
costs the Company incurs to own, operate, and maintain
faci'lities installed beyond the company's point of
de'livery that are so1e1y for the purpose of meeting theservlce requlrements or one customer youNGBLooD, REB 8
rdaho Power company
a. oo existing facilities charge customers have
the option today of owning and operating the'ir own
electrical equipment 'in order to eliminate the facilities
charge they are paying?
A. yes. tn accordance with the tariff provisions,
a customer may request the company to remove
company-owned faci'lities beyond the company's po'int of
delivery. The customer would pay the company the
"non-salvable cost" of such removal, which is comprised
of the tota'l depreciated costs of materia'ls, labor, and
overheads of the facilities, less the difference between
the sa'lvable cost of material removed, and removal labor
cost including appropriate overhead costs. All
faci'lities charge customers have this option today. rn
fact, on August 25, 20],,L, Simplot made such a formal
request to the company to provide a quote for the remova'l
eage 81
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I . J, R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
-
Pagc 13
120511afn. txt
t7 of company-owned faci'lities from its locat'ions. rhe
18 Company responded by inviting simplot to meet with
19 company's operational and eng'ineering personnel to
20 develop such a p1an.
2L a. Has the company proposed an option for
22 customers to purchase Company-owned facilities beyond its
23 point of delivery?
24 A. Yes. The Company is proposing in this case to
25 provide chanqes to its tariff lanquaqe that wou'ld a'l]owfaci'lities charge customers with i b[yout option.2so l3:il3'!3ff3r E5f,o",i
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a. please describe the company's proposa'l for
tariff language changes in order to provide faci1ities
charge customers with a buyout option,
A. the Company is proposing to create a netrrl rule,
nule u - raci'lities charge service, which wou'ld fu'l1y
describe the Company's rules and policies for providing
facilities charge services. currently, rules for
facilities charges are'located in various schedules.
consolidating faci'lities charge ru'les and policies into a
single rule wil'l al'low the company to more efficiently
manage tariff issues re'lated to facilities charge
services, as wel'l as provide faci'lit'ies charge customers
with more transparency related to facilities charge rules
and policies. exh'ibit 52 is a copy of the company's
proposed new Ru'le M. within Ru'le M, the Company
describes the responsib'il'ities of the Company to provide
ownership, operation, and maintenance of company-owned
facilities beyond the company's point of defivery in
cons'ideration of the customer paying a faci'lities charge
approved by the commission. rn addition, the company haspage 82
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
Page 14
120511afn. txt
2L provided a new option for customers who may request to
22 purchase company-owned facilities installed beyond the
23 point of de'livery. ls stated in the new provisions of
24 the company's proposed nule M, a1'l sa'les must be approved
25 by the Commission and meet the following provisions:
2s1 YOUNGBLOOD, REB 9
rdaho Power Company
1 rdaho code section 61-328;
Z no mixed omership of facilities:
3 the customer must provide the operat'ion
4 and maintenance of a'll faci'lities installed beyond the
5 point of delivery after the sale is comp'lete; and
6 the customer must pay for the engineering
7 costs for determination of the sale,
I Q. what do the provisions of rdaho code section
9 6L-328 provide?
10 A. trithin rdaho code section 61-328, it states
11 that before authorizing the sa'le of public utility owned
LZ property, the commission shall find that the transaction
13 is consistent with the public interest; that the cost of
L4 and rates for supp-lying service will not be increased by
15 reason of the sales transaction; and that the customer
16 who wou'ld be making the purchase has the bona fide intent
L7 and financial ability to operate and maintain the
18 property purchased
19 A. now does the Company interpret the provisions
20 of rdaho code section 61-328 with regard to provid'ing
2l customers with a buyout option of company-owned
22 facilit'ies beyond the point of de'livery?
23 A. In order for the company to agree to the sale
24 of its faci'lities beyond the po'int of delivery, the
rage 83
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
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Pege l5
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120511afn. txt
company would need to determine that none of its
remar nr ng
252 YOUNGBLOoD, REB L2rdaho Power company
customers wou'ld be adverselv imoacted bv the sale offacilities. Specifically. the tompanv foould need tofacilities. Soecificallv. the Comoanv would need to
ensure that thb aporooriiie equiom'ent-is in olace atensure that the aoorooriate eouioment is in olace atooint of de'liverv'buch that nd ebuioment failure orensure tnat tne aDDroDrrate eoulDment ls ]n Dlace apoint of de'livery'buch_that nd ehuipment fallure or
ina'lfunction would re9u1t in a degradation of the Company'sre'liability. and service to .its remaining cuslomers. rn
L
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those
the
5
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reliability and service to its remain'ino customers. Inaddition, the company would need to enslre that customerates. which may include a revenue credit from revenues
addition, the Company would need to ensure that customers'ralgs, which may. inclu{e +_feyenue. credit from revenuescollected throuqh the facilities charqe. wou'ld not be
adversely impacted by the sale. __rf t6eie conditions
he tacllrtles cnarqe. would not beby the sale. rf t6eie conditions wereuld make a filino with the commissionmet. the-combany would make a filinq with the Commissionfor'each orobosld sale assertino thit such sale would betor each proDosed salein the publit interest.ng thit such sale would be
A. Has the company determined a proposed
9 methodology for determining the sa'les price for the sale
10 of faci'lities beyond the point of delivery?
11 A. No. the company is not proposing any specific
L2 pric'ing methodo'logy in this case, just the proposal to
13 change its tariffs tn order to provide
L4 customers to purchase the facilities.
15 proposed tariff'language is adopted and
16 commission, and if and when a customer
an option for
rf the company's
approved by the
requests the
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purchase of facilities beyond the company's point of
delivery, the Company would attempt to determine a
mutually agreed upon price for the sale of the facilitiesprror to
YOUNGBLOOD, REB L2rdaho Power company
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
eage 84
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120511afn. txt
L brinqinq the sales transaction to the commission forappr6vaT. rf a sales price cannot be mutua'l'ly agreed2 ubbn, the company or the customer may initiat6 a
o'roc6edino beforir the commission in irrder to determine the3 ippropriateness of the price.
4 Q. Are there other provisions of the new buyout
5 option the Company wishes to discuss?
6 A. Yes. rhe company's proposa'l wou'ld inc'lude the
7 provisions that there be no mixed ownership of
8 facilities. rn other words, the custofier would need to
9 purchase all of the company-owned equipment beyond the
10 point of de'livery, not just pick and choose which pieces
11 of equipment they would want to purchase. Also, rdaho
LZ Power would not perform any operation or maintenance of
13 the facilities once they have been purchased. Such
L4 activities wou'ld be an unregulated activity for services
15 rendered beyond the company's point of delivery, and is
16 not a part of the Company's core business practices.
Ll a. rf facilities charge customers elect this new
18 tariff option and purchase company-owned faci'lities,
19 would that same customer have the option in the future to
20 sell the facilities back to the company and have the
2L company maintain and operate those facilities?
22
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24 A. No. once a customer elects th'is new tariff
25 provision and the Company sells them Company-owned
254 YOUNGBLOOD, REB 13
rdaho Pou,er company
1 facilities, the customer will be solely respons'ible for
2 maintaining and operating those facilities on a
rage 85
J. R SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
Page 17
120511afn.txt3 going-forward basis.
4 Q. Are you propos'ing anything e'lse which responds
5 to the issues raised by ICIP witnesses in their direct
6 testimony?
7 A. Yes. rhe witnesses for tctp expressed concern
8 over the fact that the company had no record of customers
9 requesting that the company install, own, operate, and
10 maintain electrica'l facilities beyond the company's point
11 of delivery in consideration for the payment of a
t2 facilities charge. rc described earlier in my testimony
13 and in the testimony of n'tr. rline, the facilities charge
L4 service is a service the company provides at the request
15 of the customer, and which the company has the discretion
16 to accept or reject provid'ing that service. that said,
L7 tcrP witnesses are correct that in many instances there
18 is no written record or contract memorializing the fact
19 that the company was agreeing to provide this service on
2A behalf of the customer. Therefore, the company is
2L proposing the raci'lities charge Consent and
22 Rcknowledgement rorm which wi'|1 be signed by all
23 customers requesting to enter into a Facilities chargeServices arringement. 'rhe new form wi'll
24
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255 YOUNGBLOOD, REB 13rdaho Povter Company
1 be a Dart of the comoany's newlv oroposed nule u and isoroviiled on oaqe thrbe trf exhiOit'Sz. rhe form is2 \ntended spettftcally on a going-forward basis for newfaci'lities charoe transactions. However. the comoanv also3 commits to comm[nicate with all of its eiistinq ficilitiescharoe customers to orovide them with the ooooitunitv to4 sion-the form and orbvide information reoarilino the -new
pr6posed faci'litiei charge buyout opt'ioni5 Q. Is the Company proposing any changes to the
6 existing methodology for determining the appropriate
J, R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
Rage 86
Pege 18
7 facirities .h".g.?120511afn'txt
I A. No. the commission-approved methodology that
9 the company currently uses is appropriate and fair to all
10 customers. rhe company maintains that the facilities
11 charge rate reduction that was proposed in the oirect
LZ restimony of mr. scott sparks is fa'ir and reasonable.
13 The Company continues to encourage the Commission to
t4 adopt its proposed revised monthly facilities charge
15 rates of 1..41 percent for customers taking Rrimary or
16 transmission Service under schedules 9 and 19. rhe
L7 company is also proposing a rate of 1.41 percent for
18 customers taking transmission Serv'ice under schedule 24.
19 For customers currently paying a facilities charge
z0 under schedule 15, the company continues to propose a
2L rate of 1.51 percent per month and for customers
22 currently
23/
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256 YOT'NGBLOOD, REB 15rdaho Power company
1 paying a faci'lities charge under Schedule 41, the company
2 is proposing a rate of 1.21 percent per month consistent
3 with the direct testimony provided by mr. sparks in this
4 case.
5 Q. rs it true, as Mr. sturtevant points out in his
6 direct testimony, that the Company is not proposing to
7 update the facilities charge rate for the simplot specia'l
I contract, schedule 29?
9 n. No, that is not true. while the company did
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
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120511afn. txtnot specifically discuss the revised spec'ia'l contract
schedule 29 in its direct testimony, the updated rate was
included in the proposed schedule 29 tariff sheet
submitted with the company's epplication in both
Attachment No. 1 and lttachment No. 2. The proposed
revised faci'lities charge rate for the special contract
schedule 29 is 1.41 percent, the same reduction as is
being proposed for the company's schedule 19 customers.
a. Have the signing parties to the general rate
case sett'lement stipulation ("stipu'lation") submitted in
this proceeding agreed to any provision in the event that
the commission adopts rcrp's recommendation to modify the
existing facilities charge methodology such that it
23 changes the amount of revenue proposed to be recovered
24 through the fac'ilities charge?
25
257 YOUNGBLOOD, REB 16
rdaho Power company
A. Yes. Raragraph 11(c) of the stipulation
2 submitted on september 23, zOL]-, in this proceeding
provides that the "signing Parties agree that any revenue
requirement impacts resulting from changes to the
facilities charge methodology or changes in property
ownership sha'll be directly assigned to schedule 19
7 customers in the form of a base rate increase or
8 reduction so that no other customer classes shall be
9 impacted by any resu'lting change."
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10 a. what would be the impact of
11 the Stipulation if the company were to
LZ company-owned facilities to customers
13 proposed by ICrP?
this provision of
give away
for free, as
J. R, SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
nage 88
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Exhibit 6
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120511afn. txtA. rf the company were to assign ownership of
fully depreciated facilities to customers, as advocated
by ICIP, the Company would experience a shortfall to its
revenue requirement. Per the stipulation, the company
would direct'ly assign to a'll schedule 19 customers an
increase in rates to make-up for that revenue shortfa'll.
a. Do you have any concerns with the proposal to
away facif ities made by rcrP?
A. Yes, r do. as exp'lained'in Mr. Klfne's
testimony, of the Company's approximately 240 faci'lities
charge customers in tdaho, simp'lot is the only facilities
charge customer in recent memory that has formally
25E YouNGBLooD, REB 16a
rdaho Power company
requested a buyout option. r believe, as does Mr. t<line,
that this indicates that the vast majority of the
company's other facilities charge customers have
appreciated and benefited from the company operating and
prov'iding maintenance on facilities that they would have
had to pay for and maintain themselves. rhe company
submitted data requests to rcrp asking which of their
members are actively participating in this case and
whether any of their members would be willing to purchase
company-owned facilities knowing that they would need to
maintain those facilities once sold. The intent of these
data request,s was to determine which of rcrp's members
were aware that the ICIP proposal could result in a rate
increase. rcrP refused to answer these questions. So,
ultimately, tdaho Power has no way of knowing whether the
proposa'ls made by rcre are representative of all of its
members, 1et alone all of the approximately 240
eage 89
Page 2l
120511afn. txt18 facilities charge customers in rdaho.
19 a. oid the tndustrial Customers of rdaho Power
20 sign the stipu'lation in case No. rPc-E-11-08?
2l A.' Yes. Mr. Peter Richardson, tttorney for
22 tndustrial customers of rdaho Power, signed the
23 stipulation on september 21, 2011.
24 a. rs the company proposing any additional
25 commitments with regard to its facilities charge service?
259 YOUNGBLOOD, REB L7rdaho Power company
1 A. Yes. since the revenue received from
2 facilities charge customers reduces the revenue
3 requirement of the associated class, the company commits
4 to performing a review and potent'ia1 update of its
5 facilities charge rate as part of each future general
6 rate case fi'ling. rn this way, the facilities charge
7 rate wil'l be subjected to not only the company's interna'l
8 review on a regular basis as it has in the past, but will
9 be scrutinized by the commission and interested
10 intervening parties as part of the revenue requirement
11 determination.
LZ A. Does this conclude your rebutta'l testimony in
13 this case?
L4 A. Yes, it does.
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
eage 90
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12051lafn.txt
260
(rhe following proceedings were had 'in
MR. WILLIAMS: Thank you, Madam chair.
now available for cross-examination.
COI4MISSIONER SMITH: MT. OttO.
MR. OTTO: NO qUeStiOnS, Madam Chair.
CO{MfSSIONER SMITH: Mr. eurdy.
MR. PURDY: r haVe nO qUeStiOnS. rhank
Ol sen.
you.
NO
Howell or
No questions.
SMITH: NOW tO MT.
MR. RICHARDSoN: Thank you, Madam chair.
YOUNGBLOOD, REB 18rdaho Power company
1
2 open hearing.)
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4 The witness is
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
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CSB REPORTING(208) 890-s198
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CSB REPORTING(208) 890-5198
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
26L YOUNGBLOODrdaho Power company
CROSS.DGMINATION
BY MR. RICHARDSON:
a cood afternoont Mr. Youngblood.
A Good afternoon! Mr. Richardson.
a were you here when Mr. sparks testified?
A I WAS.
a Rnd do you recal] my 'line of questions
with nltr. sparks on how often rdaho Power conducts the
periodic review of the facility charge rates?
A Yes, I do.
a oid you hear ur. sparks refer to you as
the person who informed him that such reviews take
pl ace?
A Yes, I did.
a md di d you i n fact tel'l tlr. sparks that
such reviews take place?
A rhey do. rhey do periodically.
a Can you tell me what that means?
A periodically means just periodica'lly, so
it's not necessari'ly on a fixed, set, established basis.
They are done every year, every couple of years on an
as-needed basis.
a uow do you know when they need to be
updated? what's the as-needed trigger?
rage 92
262 YoUNGBLooD (x)
Idaho Power Company
Page24
1205llafn. txt
1 A part of the recent trigger was inquiries
2 by the rndustria1 customers and they were reviewed at
3 that time. lf interest rates change significantly, they
4 may be reviewed at that time. rf rate of returns change
5 or change differently, they wil'l be reviewed at that
6 time.
7 Q And over the last 25 years there's never
8 been an event such that you felt that the facilities
9 charge rates needed to be updated?
10 A rhat is not correct. tlrle'll, it is correct
11 that they didn't need to be updated. They were reviewed
LZ over the past 25 years.
13 a t understand that. Rlso, Mr. sparks was
L4 asked about sa'lvage of equipment. who at the company
15 makes the determination of the salvage value of a piece
16 of equipment?
L7 A r believe it's our finance department.
18 A end t a'lso started on down a line of
19 questions with vtr. sparks wh'ich he deferred -- which
20 nltr. rline, r believe, deferred to you, so r'11 go down
2L that line and see if we can't make some progress. when
22 rdaho Power insta'l'ls a new turb'ine at ttells canyon Dam,
23 do you think it's fair for this commission to a'llow rdaho
24 Power to put the cost of that turbine into rates and to
25 earn a return on it?
CSB REPORTING(208) 890-5198
263 YOUNGBLOOD (x)
rdaho Power company
A Yes, I do.
a Is it fair for the commission to set
1
2
rage 93
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
E
Idaho
Page 25
1205l1afn. txt
3 Power's reta'il rates such that rdaho Power can in fact
4 collect that return?
5 A Yes,Ido.
6 Q ls it a'lso fair to the ratepayers of rdaho
7 Power to require that piece of equipment to depreciate
8 over its usefu'l 'life?
9 A Yes, it is.
10 a so the flip side of that question is,
11 then, it's unfair to the ratepayers to never depreciate
72 that equipment over its useful life?
13 A You're speaking about the generator or
t4 turbine still?
15 a Yes.
16 A That is correct.
L7 a And when that turbine is fully depreciated
18 out, who has claim to any residual value, the ratepayers
19 or the shareholders?
20 A rf it is fully depreciated out, there is
2l no residual value.
22 a rf it's depreciated out for ratemaking
23 purposes, a piece of equipment may in fact have economic
24 value after being depreciated --
25 A tttarket val ue?
CSB REPORTING(208) 890-5198
264 YOUNGBL@D (X)
rdaho Power company
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a -- out; correct?
A YES.
a who has rightfu'l claim to that residual
va1ue, the ratepayers or the shareholders?
A r would say that both the ratepayers and
the shareholders. rhe ratepayers have pa'id for it and
Page 94
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
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Exhibit 6
120511afn. txt
7 the shareholders have earned a return on that, so r'm not
8 sure who the rightful claim would be. rt's tdaho Power's
9 equi pment.
10 a Beginning on page 2 of your testimony on
11 line 14, you state that the faci'lities charge was
L2 designed to provide a means to charge specific customers
13 the cost of service re'lated to facilities beyond the
L4 point of delivery; correct?
15 A rhe facilities charge service was designed
16 to provide a means to charge specific customers the cost
L7 of service related to fac'ilities beyond the point of
18 delivery which are installed, owned, operated, and
19 maintained by the company, correct.
20 a Now, when r hear the phrase "cost of
2l service" in re'lation to a charge that a util'ity is
22 charg'ing for a service, r natura'lly assume that it is
23 attempting to identify the actual cost to provide that
24 service; would you agree with that defin'ition?
25 A lwouldnot.
265CSB REPORTING(208) 890-s198
YOUNGBLOOD (X)
rdaho Power company
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a How wou'ld you define cost of service?
A rt says cost of service related to the
faci'lities, so it's not a one-for-one recovery of cost of
servi ce.
a Are you not attempting to identify the
cost to provide that service when you do your periodic
reviews of the facilities charge rate?
A No, t,lie are determining similar
components, the same billing components, used to
determine a non-1evelized approach as you do in
eage 95
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
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Exhibit 6
Pe,ge27
120511afn. txt
L1 ratemaking to a level'ized approach as we do in the
LZ facilities charge, so we are looking at similar billing
13 components, cost components in order to determine that
L4 rate. rt is not a one-for-one recovery of those
15 dol lars.
16 a But according to your own testimony, it's
L7 an attempt to charge specific customers the cost of
18 service related to facilities, so yourre attempting to
19 identify the cost of service, are you not?
20 A what it is is to try to recover those
2t costs related to the faci'lities beyond the point of
22 de'livery in order to offset the costs that are being
23 recovered through base rates.
24 a can you tell me how the r. R. simplot
25 company's payment of 20 percent a year on the original
CSB REPORTING 266 YOUNGBLOOD (X)[phone] rdaho Power company
1 installed cost of a transformer that is now over 66 years
2 o'ld is in any way related to rdaho Power's cost of
3 providing that transformer to simplot?
4 A rhe 20 percent a year r'm assuming is the
5 L.7 percent facilities charge per month that is in the
6 tariff.
7 Q That's correct.
8 e rhe 1.7 percent facilities charge that is
9 in the tariff is charged on a'leve'lized basis times the
10 installed cost or initial cost of that equipment. That
lf is on a pool of assets that -- would you like me to
L2 describe the facilities charge methodology?
13 a please.
t4 A tn the facilities charge methodo'logy, w€
rage 96
J. R. sIMpLor coMpANy's MorIoN To rAKE Page 28
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
12051lafn. txt
15 have an attempt to try to recover those costs that are
16 associated with providing a service for facilities that
Ll are installed solely for specific customers beyond the
18 point of delivery of the company. e'l'l of the facilities,
19 the distribution facilities, for the Company's customers,
20 including all of those faci'lities that are beyond the
2L point of delivery, are within base rates of aI'l the
22 customers, let's say, of a part'icu'lar class, schedule 19
23 customers.
24 e'l'l of those are being recovered in the
25 rates that are determined for that class, but it's not
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prudent to charge all of those customers for facilities
that are only in place to serve a particular customer, so
what the facilities charge methodology does is takes the
same costs and on a leve'lized basis for'administrative
purposes credits back in the determination of the revenue
requirement for that c]ass, so the chart on page 4, what
r was trying to demonstrate, then, is the difference
between a non-Ieve'lized recovery and a 'leve'l'ized
recovery. rhe non-levelized recovery mechanism is the
mechanism that is used during the typical ratemaking
revenue requirement and the 'levelized is what faci'lities
charge customers pay. tn total, the same amount of
revenue is recovered.
a Letrs turn to page 4 and take a 'look at,
that chart. Now, help me understand where the phrase
"levelized cost recovery" comes from, because in this
venue, r'il only familiar with talking about levelized
rates in the puRpA context. where does this ]evelized
page 97
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Exhibit 6
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r 205llafn. txt
19 rate concept come from?
20 A rt is another methodo'logy for rate
2L recoveryt revenue requirement.
22 a r understand that, but what's the source
23 of this?
24 A rh'is is the approved methodology by the
25 commission for the faci'lities charge.
CSB REPORTING 268 YOUNGBLOOD (X)[phone] rdaho potver company
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A okay, and has the commission cal1ed it
levelized cost recovery before?
A t don't recall if they have or not.
a okay; so possib'ly this leve'lized concept
is one way of you describing this ratemaking construct to
help us understand more ful1y what you're do'ing?
A rt is exactly what we're trying to help
you understand is how the revenue is being recovered
under two different methodologies, correct.
q nnd in the box on page 4, the horizontal
axis, the bottom Iine there, that represents time;
correct?
A Correct.
a Rnd each'line, vertica'l 1ine, represents a
year?
A It represents nothing. It's a
coloring-in, just trying to show that ear'ly ofl, before
the midpoint, whatever time frame that you would 'like to
use, that the non-Ievelized approach recovers more than
the levelized approach does, and later on in that same
time period, the levelized approach would be paying back
the subsidy that existed at the beginning of the
Page 98
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Exhibit 6
Prge 30
120511afn. txt
23 period.
24 a we'11, I
25 it's coincidental that
CSB REPORTING(208) 890-5198
counted the little lines there and
it's the same number of years that
r wi'll accept that subject -- r can count
would like.
269 YOUNGBLOoD (X)
rdaho Power company
the faci'lities charge depreciates at, 32 years, so
there's 32 lines there.
A
them if you
a so under what you called the traditiona'l
requirement ratemaking methodology, the
line -- correct?
base revenue
non-1 evel ized
A correct.
a -- what happens at year 32 according to
your chart?
A In year 32, what do you mean by "what
happens"?
a We'lI, how much cost recovery is the
Company entitled to at the end of that line?
A If there was an asset that was implemented
or installed at the very beginning of the time and
nothing ever happened during that time and it was ful'ly
depreciated over, as you said, the 31, 32 years, it would
be fu'lly depreciated. There would be zero residual
val ue.
a zero cost recovery?
A there wou'ld be no cost recovery,
correct.
a so on the non-tradit'ional Ieve'lized line,
we get out to year 32, what happens then?
CSB REPORTING 27O YOUNGBLOOD (X)
eage 99
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Exhibit 6
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12051lafn. txt(208) 890-51e8 rdaho Power company
1 A Exactly the same. ell the same amount of
2 revenue recovery has been recovered under the 1evelized
3 approach as it had been under the non-'leve'lized
4 approach.
5 a So in year 33, that line goes to zero as
6 we'll ?
7 A what you're saying here, r think what
I you're trying to lead toward is the 3l years and saying
I that after 31 years that costs are fully recovered; is
10 that what you're try'ing to --
11 a we11, r'm just trying to understand your
L2 testimony here.
13 A My testimony with regard to this chart is
L4 saying that two different approaches for recovering a
15 revenue requirement are identica'l in what they recover or
16 are close to; that being the non-leve'lized approach
L7 recovers the same amount of revenue recovery as the
18 levelized approach.
19 a rsn't that on'ly true if at the year 31 the
20 levelized number also goes to zero going forward?
2l A Rt whatever time frame that you would take
22 a non-'levelized approach and a levelized approach, they
23 would recover the same amount of recovery.
24 a okay, and the time frame you've chosen on
25 your chart is 31 bars, 31 years, and let's keep the 31
CSB REPORTING 27L YOUNGBLOOD (X)[phone] rdaho Power company
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICTAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
eage 100
Prge 32
1205llafn. txt1 years of depreciation that you've identified here and
2 extend five more bars out, so it's now 37 and the
3 non-levelized rate hits zero in year 32, what happens to
4 the levelized rate in years 33 through 37?
5 A what r think you're trying to say with
6 regard to -- r mean, r don't have a time frame on this
7 and what t have said is that it is an average expected
8 1ife and so this would be the average expected life of an
I asset. rn the case of facilities charges, that 'is the
10 average expected 'life of a pool of assets, and those pool
11 of assets are determined for the faci1ities charge and it
12 wou'ld be the average expected life of the pool of assets
13 for depreciation purposes as 31 years, so that would mean
14 that assets would depreciate or cou'ld be fu'lly
15 depreciated over that period of time, but that thei r
16 expected 1ife could live well beyond that po'int in
L7 time.
LB a so if the average expected life is 31 or
19 32 years, if the actual life is longer in rea'lity, then
20 the levelized faci'lities charge works as a subsidy,
2L doesn't it?
22 A ri the average expected life was longer in
23 rea'lity, then it would be depreciated over a 'longer
24 period of time, and both the leve'lized and the
25 non-leve'l'ized approach wou'ld still recover the same
YOUNGBLOOD (X)
rdaho Power Company
CSB REPORTING(208) 890-s198
J. R. SIMPLOT COMPANY'S MOTION TOTAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
amount of revenue.
a rf the average expected life is as you
represented, 32 years, and the actua'l asset was in
serv'ice for longer than that time period, doesn't this
eage 101
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Page 33
120511afn. txt5 leve'lized charge work as a subsidy?
6 A r guess what you're saying is would
7 customers who have equipment that are in place for a long
8 period of time be subsidizing and the ansurer to that
9 would be yes, just as customers who have equipment in for
10 a very short period of time and it is removed are being
11 recovered. rt is an average expected life of
L2 equipment.
13 q so when you state at the bottom of page 4
L4 over to the top of page 5 that your chart shows the total
15 amount of revenue recovered from either mechanism is
16 identical, that statement is not true, is it, if the
17 facilities charge equipment 'lasts 'longer than 32 years?
18 A rf the facilities charge -- actually, the
19 statement is true that the total amount of revenue
20 recovered from either mechanism is identica'|. r'm
21 showing it over the same time period. rf a non-levelized
22 approach was used for a longer period of time and a
23 levelized approach was used for the same amount of time,
24 under a levelized or a non-Ievelized approach the same
25 amount of revenue wou'ld be recovered.
273CSB REPORTING(208) 890-5198
YOUNGBLOOO (X)
rdaho Power company
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' a and r asked you, but whenever a facilities
charge facility has a 'life 'longer than your depreciation
period, that statement is no longer true, is it?
A nnd what r'm saying 'is if you have a p'iece
of facility that is -- you're using levelized and you're
trying to compare that to the non-levelized approach, you
need to extend both lines.
a Do you have any data on the actual average
eage 102
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
Page 34
120511afn.txtthe equ'ipment subject to th'is charge?
A r believe the average expected 'life --
a r said actual.
A t'm sorry?
a rhe question was do you have any data on
average life of the equipment subject to this
15 charge and you started answering the expected and that's
16 not what t asked you.
A well, average 'life and average expected
would term the same and that would be 31 years.
20 that many
a so it would surprise you, then, to learn
of these facilities are c'loser to 40 or 50
2L years o1d?
22 A rt would
23 is 31 years, that means
24 than 31 years and some
25 years, so it would not
CSB REPORTING(208) 890-ste8
274 YOUNGBLOOD (x)
Idaho Power Company
9 life of
10
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L7
18 life r
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1
2 equipment
3
4 the
5 may
6 that
7 nay
I
not at all. rf the
that some facilities
average life
are less
a
1S
A
facilities are greater than 31
surpri se me at al'l .
would you agree that much of simp'lot's
outliving the 3I-year life?
t would agree that simplot who is one of
first, if not the first, facilities charge customer
have equipment that has long lives, y€s. t a'lso know
there may be some facilities on S'implot's site that
be less than 31 years.
a In your testimony you state that
9 or. neading's proposal to track actual depreciated costs
10 of facilities charge equipment would be difficult -- that
11 f t wou'ld be difficu'lt to track thousands of pieces of
L2 equipment for 240 customers; do you recall that?
eage 103
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Exhibit 6
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Page 35
120511afn. txt13 A rdo.
L4 q Have you thought that statement through
15 and researched what type of Excel program may be
16 available to handle those ca]culations?
L7 A No! I mean no.
18 a so you haven't explored how to possibly do
19 those calculations at all?
20 A For every single piece of equipment on a
2l facilities charge, determining the date of their
22 installation, determining separate depreciable 'lives, no.
23 The Company's accounting does a group and poo'ls assets.
24 ror example, all poles are pooled together. There's a
ZS depreciable life for those. There are different
CSB REPORTING(208) 890-s198
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YOUNGBLOOD (X)
rdaho Power Company
depreciation tab'les for different pieces of equipment.
transformers may have different depreciable lives than
poles or lines or switch gear. rt is just
administrative]y difficu'lt, if not'inrpossible.
a So isn't rdaho Power used to dea'ling with
thousands of calculations and many thousands of customers
in very complex ways?
A Idaho Power does have billing systems that
deal with hundreds of thousands of customers and provides
the bills for them, yes.
a How many customers does tdaho Power
have?
A r believe it is 450 some odd thousand
residential customers. t would have to check on that for
sure.
a erobably pushing as many as 500,000 total
eage 104
J, R. SIMPLOT COMPANV'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
Page 36
12051lafn. txtL7 customers?
18 A very easily.
19 a Rnd does each and every one of those
20 500,000 customers generate a unique bill each and every
2L month?
22 A Yes, they do.
23 a nnd how many facilities charge customers
24 did you say you have?
25 A 240 facilities charge -- approx'imately 240
CSB REPORTING 276 YOUNGBLOOD (X)(208) E90-5198 rdaho Power company
'locations.
2 Q Letrs just look at, for example, schedule
3 19, the charges that you keep track of each month for
4 each customer. You have seasonal time-of-use rates. You
5 have seasona'l demand rates, summer on-peak demand
6 charges, a basic charge, a service charge, and a minimum
7 bi1'ling charge. rhat's six different charges for one
I customer --
9 A Correct.
10 a -- on schedule 19 and how many schedule 19
11 customers do you have?
LZ A r believe around 136. r don't recal'l
13 right now.
L4 a so in light of rdaho power's ability to
15 keep track of this seemingly unf imited amount of data on
16 500,000 customers and your sophisticated billing capacity
t7 to keep track of customers, doesn't it seem to you that
18 it's not that big of a burden to keep track of 240
19 customers?
20 A No, not at all. what you're saying is
tft,:Xl'-"J':3yi$ffiiXF#ll,li'"H8,*",
ease 105
Pagc37
Erhibit 6
120511afn. txt2L trying to keep track of the thousands of pieces of
22 equipment for them. I did not say for those 450 or
23 500,000 customers that we have identified for every
24 single one of those customers the thousands of pieces of
25 equ'ipment that are used to deliver the service to them.
CSB REPORTING(208) 890-5198
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YOUNGBLOOD (x)
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r don't have track of each of the line mi'les, the meters
for each individual customer identified.
a Now, on page 4 you talk about this
non-traditiona'l cost recovery mechanism for facilities
charge equipment.
A r did not say it was non-traditiona'1.
a we'll, you characterized the non-leve'lized
as traditional, so r assumed that you were
differentiating the levelized from the non-levelized as
bei ng non-traditiona'l .
A r was differentiating levelized from
non-1evelized.
a you did not use the word traditional when
you described non-levelized?
A rrom traditional ratemaking, correct.
a so that's the traditional way to do it, so
levelized is what way to do it?
A It is a'levelized approach.
a uon-traditional?
A rhe traditional ratemak'ing is for cost of
service of general rates, not for faci'lities charge.
What r was different'iatJng was between the non-levelized
approach that is used in the traditional ratemaking like
general base rates and a levelized approach.
J. R. SIMPLOTCOMPANY'S MOTION TOTAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
eage 106
Page 38
25 a
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICTAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
120511afn.txt
And you differentiated the non-'leve'lized
YOUNGBLOOD (X)
rdaho Power company
278
1 as being traditional and is it not a logical conclusion,
2 therefore, to say that the levelized is
3 non-traditional?
4 A Mr. Richardson, if you would 'like to make
5 that assumption, that is fine, too.
6 a Thank you; so on page 4, you justify this
7 non-traditiona'l cost recovery mechanism for facilities
8 charge equipment from what you termed the traditiona'l
9 non-levelized depreciation?
10 A could you p'lease direct me to the line
11 that you're referring to? I'm sorry.
L2 a rt's in the box on page 4 --
13 A okay.
L4 a -- non-'levelized.
L5 A Yes.
16 a So you justify using the non-traditional
L7 line, which is the levelized line --
18 COMMISSIONER SMITH: Mr. RiChardSON, I
L9 think that's a mischaracterization of his test'imony,
20 so --
2l MR. RICHARDSoN: Thank you, Madam chair.
22 r''l'l move on.
23 coMMIssIoNER SMITH: thank you.
24 A By MR. RTcHARDSoN: on page 8, 'line 8, you
25 talk about Dr. Reading's approach for tracking
CSB REPORTING 279 YOUNGBLOOD (X)[phone] ldaho Power company
eage 107
Pnge 39
12051lafn.txt
1 depreciation levels for individual facilities; do you see
2 that?
3 A t-ine I r see the question, "Does the
4 company track depreciation levels for individual
5 facilities for any other customer class or service?"
6 a Then on line 1L, you testify that you
7 don't agree -- that the company doesn't do that because
8 it's not a standard ratemaking practice -- no, it 'is a
9 standard ratemaking practice to average the actual 1evels
10 of depreciation; do you see that?
11 A Yes. I said, "No. It is a standard
L2 ratemaking practice to average the actual 'levels of
13 depreciation together for a particular level of service
L4 or customer c'lass and spread the recovery of those cost,s
15 equally to all customers within the class."
16 a rs it standard ratemaking practice to
L7 never depreciate utility equipment such as
18 transformers?
19 A It is not.
20 a on page 7, you express concern about
2L changing revenue requirement for a customer class when
22 changes are made to faci'lities charges forindividua'l
23 customers; do you see that?
24 A can you point me to the line, please?
25 a It starts at 'line 5.
CSB REPORTING 280 YOUNGBLOOO (X)[phone] rdaho Power company
1 A okay.
2 Q So I don't understand your concern about
3 c'lass revenue requirement in this instance when class
nage 108
J. R. SIMPLOT COMPANY'S MOTION TO TAKE Pegc 40
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
120511afn. txt
4 revenue requirements are constantly changing, aren't
5 they, and probably never precisely perfect?
6 I class revenue requirement is determined
7 during a general rate case.
8 Q And in between general rate cases those
9 revenue requirements are constantly changing, are they
10 not?
11 A The revenue requ'irement, r think, remains
LZ the same. the rates that are place are based upon that
13 revenue requirement.
t4 a But the actual what's going on in the real
15 world in between general rate cases, there are changes?
16 A There are costs that are incurred.
L7 a md savings that are incurred?
18 A Yes.
19 a lnd isn't that what genera'l rate cases are
20 for is to capture those changes 'in between?
ZL A rhat is correct.
22 a lnd on page 8, you recite that the
23 company's proposed facilities charge is fair, just and
24 reasonab'le, 'l i ne 23 .
25 A Yes.
CSB REPORTING(208) 890-s198
281 YoUNGBLooO (X)
rdaho Power Company
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J. R SIMPLOT COMPANY'S MOTION TOTAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
-
a were you in the room when r asked
Mr. Kl'ine whether the concept of fairness is largely in
the eye of the beho'lder?
A I WAS.
a end isn't it true that this Commission
wi]l make that cal I and not us?
A r believe that is correct, that the
rage 109
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commission wi'l'l determine whether or not the rates are
fair, just and reasonable.
A lnd have you read the testimonies of Nr.
Butler and ur. sturtevant where they make the assertion
that this rate is not fair?
A I have read that testimony, those
testimoni es.
a so it is true that at least one of your
largest customers doesn't share your belief that this is
a fai r rate?
A the customer, I believe that the customer
is misinformed on how the rate of a facilities charge is
charged and may have made an erroneous assumption on
their part; neverthe'less, r believe that the rates have
been determined by the Commission to be fair, just and
reasonabl e.
a nnd so the quest'ion was, isn't it true
that at least one of your largest customers doesn't share
csB REPORTTNG 282 YoUNGBLOOD (X)[phone] rdaho Pori,er Company
your belief that this is a fair rate?
A they have stated that, yes.
a and you were here this morning when llr.
campbell from uccain provided public testimony?
A I was.
a And were you here this afternoon when we
discussed the Bsu letter?
A I WAS.
A would you turn to page 9? At the top of
that page on line 2, you are asked what is your response
to rcrP's suggestion that the company should simp'ly give
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
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Exhibit 5
Page 42
1205uafn.txt
12 away fully depreciated facilities; do you see that?
13 A rdo.
14 a oid you write that quest'ion?
15 A r d'id.
16 a So r 'looked and r couldn't find anywhere
L7 in the rclPrs testimony of any suggestion that rdaho
18 Power give away its facilitles. can you point to that
19 for me?
20 A t do not have the testimonies of tttr.
2L sturtevant and mr. But'ler, but if I recal], and r wil]
22 paraphrase, they were saying that faci'lities that they
23 were paying a facilities charge on, by their
24 characterization, as having no value should be given to
25 them or turned over to them.
YOUNGBLOOD (X)
rdaho Power company
CSB REPORTING(208) 8e0-5198
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a wou'ld you agree that the rndustrial
customers' witnesses have said that they have actually
paid for the facilities several times over and that this
suggests to me that they believe they have purchased the
facilities? They're not asking for, as you say in your
question, a give-away.
A r would agree that that is what is the
witnesses have characterized has happened. rhat is not
what hs occurred, that they have paid for those
facilities.
a A1so, in that first answer on page 9, you
state that "rcrP's proposal wou'ld not be administrative'ly
feasible," and you go on because "the Company does not
depreciate for ratemaking purposes individua'l pieces of
equipment separately," and you conclude that "sopage 111
J, R. SIMPLOT COMPANY'S MOTION TO TAKE
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Exhibit 6
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1205I1afn. txt
determination of when an individual pidce of equipment
was fully depreciated wou'ld be nearly impossible," but
isn't that an impossibility of the company's otrtn making?
I mean, one could figure out a system, couldn't one, by
which the facilities charge equipment could be tracked in
this day and age?
A rt is just not the way accounting
practices, generally accepted accounting principles and
practices, go or in ratemaking, general ratemaking.
a okay, and t was asking you about your
CSB REPORTING(208) 890-51eE
284 YOUNGBLOoD (X)
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statement that it's impossible, nearly impossible, and my
question wasn't about what you traditionally do,
'levelized or non-levelized, the question was could one
figure out a system by which facilities charge equipment
could be tracked in this day and age?
A In this day and age, r am sure that a
system could be created. The adminlstrative cost and
administrative overhead to implement such a system, r can
only guess, would be astronomical.
a That's a guess?
A rhat is correct.
a end you haven't investigated the
possibility of doing that?
A No, si r.
a on page 9, also on page 9, still on page
9, on line 17, you state that the facilities charge has
never been a "lease-to-own" charge and you put quotes
around the phrase "lease-to-own." You weren't quoting an
rndustria'l customer witness, were you?
eage 1L2
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J, R. SIMPLOT COMPANY'S MOTION TO TAKE
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Exhibit 6
Pege 44
12051lafn. txt
20 A It,vasnot.
2L a so that's your phrase?
22 A Yes, that is my phrase.
23 a turning over to page 10, you cite the
24 commission to rdaho code section -- I guess it's page 1J.
25 to L2 where you cite the commission to rdaho code section
CSB REPORTING(208) 8e0-s1e8
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YOUNGBLOOD (X)
rdaho Power company
61-328; do you see that?
A rdo.
a lnd as you identify several prov'isions at
the top of page 12 that must be met in order for the
company to sell a facility; do you see that?
A I see that. What I am describing there is
the Company's proposal to provide a buyout option as part
of this proceeding in response in particular to Simplot
company.
a lnd then you're asked at line 8 on page
L2, "what do the provisions of rdaho code section 61-328
provide?" lnd your answer is at line L0, "within rdaho
code Section 6L-328, it states that before authorizing
the sale of public utility owned property..."; do you see
that?
A r do, and that is correct.
a So is your understanding that this first
part of the code section only requires that the property
be public utifity owned property?
A rhat would be a legal interpretation, but
it is my understanding this is with regard to public
uti'lity owned property, this section of Idaho Code.
a Have you read that section of the rdaho
nage 113
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24 code?
25 A r have.
csB REPORTTNG 286 YOUNGBLOoD (X)[phone] rdaho Power company
1 Q 5o would it surprise you to learn that the
2 test may be a little more nuanced than just.public
3 utility owned?
4 A I would defer to legal counse'|.
5 e Rnd you note at the end of that paragraph
6 that the customer who purchases the facility must have a
7 bona fide intent and financial ability to operate and
8 maintain the property; do you see that?
9 a rhe property purchased, correct.
10 a Yeah, the property purchased, that's what
11 we're talking about, so if simplot purchased that
LZ 66-year-old transformer from you and thereafter decided
13 that that factory is going to be closed and didn't
L4 actually use that transformer, do you think that they
15 could legally buy it from you because they wouldn't be
16 operating that purchased facility?
L7 A lgain, t would probably defer on 'legal
18 counsel on that, but what r'm describing here were the
19 provisions provided in the rdaho code and it was provided
20 as one of the conditions that would need to be met under
2L the company's proposed buyout option, if approved by the
22 commission at this point in time, but it would be, r
23 think, a legal deteimination whether or not the company
24 who purchased the equipment if it was no 'longer going to
25 use that equipment would meet this qualification.
CSB REPORTING 287 YOUNGBLOOD (X)[phone] rdaho Power company
nage 114
J. R. sIMpLor coMpANv's MorIoN To TAKE Pege 46
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Erhibit 6
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1205l1afn. txt
1 a when r was visiting with Mr. sparks, we
2 were talking about facilities that are much older than
3 your average expected 31-, 32-year life and those
4 facilities are stil'l being assessed the fu'll faci'lities
5 charge, which includes depreciation, return, €t cetera,
6 et cetera, and r think we talked about subsidies between
7 individual customers and the remaining customers in the
8 class, and we ta'lked about -- do you reca'|1 our
9 discussion about when, 'like, simplot leaves the
10 facilities charge family that the lost revenue from that
11 facilities charge payments they were making are to be
L2 made up by the remaining members of the c'lass?
13 A r recall the discussion, y€s.
L4 a And do you agree with nltr. Sparks that when
15 a faci'lities charge customer goes au{ay that revenue is
16 thereafter made up by rais.ing the rates of the other
L7 c'lass members?
18 A The revenue lost by that faci'lities charge
19 revenue because it is used as a credit to the revenue
20 requirement determination of a particular c'lass, that
2L c'lass would need to recover that revenue, yes.
22 a okay, then in your further discussion at
23 the bottom of page 12 of the operation of section 6L-328,
24 you state starting on line 24 that the company would need
25 to determine -- and this is the company's interpretation
CSB REPORTING(208) 890-s198
288 YOUNGBLOOD (X)
Idaho Power Company
1 of the provisions
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
of this code section according to the
eage L15
Page 47
12051lafn . txt2 question -- that the company would need to determine that
3 none of its remaining customers would be adversely
4 impacted by the sale of those faci'lities, and if what
5 Mr. sparks and I discussed was true and you just
6 confirmed that every time that happens those revenues
7 have to be made up by the other customer classes, how is
I it possible to make that determination?
I A t believe that it wou'ld be done through a
10 determination of a sales price that would be used to
11 offset any kind of tmpact to the customer or done at the
L2 same time as a general rate case filing where the base
13 rates for a particular class could be adjusted
L4 accordingly.
15 a So you adjust the sales price, keep the
16 remaining customer class whole for the 'lost facilities
L7 charge customer?
18 A you asked how could it happen and t said
19 that might be one way. Another way would be through
20 determination at the time of a genera'l rate case.
2L a so walk me through how that r'rou'ld work on
22 the purchase price scenario.
23 A we have not determined a methodo'logy for
24 determining purchase price, but if you look at future
25 revenues that would be recovered through a facil'ities
CSB REPORTING(208) 890-s198
289 YOUNGBLOOD (X)
rdaho Power company
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charge that would now be lost and those revenues were
used as a determination of the base revenue requ'i rement
for a part'icu'lar c'lass, then some kind of present value
analysis, r would assume, could be used to determine what
that price would be.
J, R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
Page 116
Pege 48
120511afn. txt6 q so correct me if r'm not understanding you
7 proper'ly, so if simplot was going to buy their facilities
8 from you, the purchase price would not just be the
9 non-salvagable cost, but it wou'ld also include the cost
10 to make the remaining customers in the class whole, so
11 how does simplot ever get away from having to pay that?
LZ A The Company's provision for a buyout
13 option proposed in this case right now in my rebuttal
L4 testimony, but has not yet been approved by the
15 Commission, was that the two companies, tdaho Power
16 company and the customer, would try to mutua'l'ly agree
L7 upon a purchase price and that that price would be set in
18 such a way that it would meet the provisions as stated
19 there, the rdaho code section 6L-328, no mixed ownership
20 of fac'ilities, so they cou'ld not just buy the
2l transformer, they would have to buy all the facilities on
22 their site, and the customer must provide the operation
23 and maintenance of all facilities installed beyond the
24 point of delivery and that the customer must pay for the
25 engineering costs for determination of the sale.
CSB REPORTING 290 YOUNGBL@D (x)
Idaho Power company(208) 8e0-s198
1 The company is not proposing at this point
2 in time any methodology at al'l for determining that
3 price. the Company is only propos'ing right now to
4 provide what it does not currently have 'in its tariffs,
5 which is a buyout option for facilities that are beyond
6 the company's point of delivery.
7 Q You mentioned on allowing simplot to
8 exercise the option to pay for removal of the facijities,
t have you read Idaho Power's 'letter that's in exhibit 308
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
eage 117
Prge 49
LzO5ilafn.txt10 at pages 5 and 6 in response to simplot's request to
11 purchase its facilities charge equipment?
LZ A r don't have that letter before me, but r
13 may have read it during the course of the year.
14 a wou'ld you agree with me that that 'letter
15 indicates that simplot wi1l need to pay substantial
16 expenses to even devise a p'lan to implement such removal
t7 and purchase?
18 A t do not have that letter before me, but r
19 do knoutr and reca1l that there are -- that the company
20 told Simplot to go ahead and propose which ones that they
2L would want to go ahead and purchase and that they would
22 begin devi'loping a plan with simplot in how to remove
23 those facilities. There's a 'lot of things that need to
24 be taken into consideration about downtime of particular
25 plants, coordination of faci'lities, coordination of the
cSB REFORTTNG 29t YOUNGBLOOD (X)[phone] rdaho Power company
1 changeover from company-owned facilities to
2 customer-owned facilities. rt was part of the process, r
3 believe.
4 Q oid rdaho Power ever offer to sel'l simplot
5 its facilities charge equipment?
6 A rt did not.
7 Q oid you read Mr. Sturtevantls testimony on
8 that issue where he testified that rdaho Power suggested
9 that simplot would have to pay rdaho Power approximately
10 $10 million for the facilities charge equipment to be
11 sold and that these facilities have a total initial
L2 i nvestment of onl y 4. 2 mi'l 1i on?
13 MR. wTLLTAMS: l,tadam chai r , r 'il goi ng to
rage 118
J. R. sIMpLor coMpANy's MorIoN To rAKE Prge 50
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
120511afn. txtL4 object. rhis is way beyond the scope of mr. voungblood's
15 testimony and he's now asking him a question based on
16 some hearsay that might be in one of his own witnesses'
L7 testimony.
18 ISSIONER SMITH: MT. NiChATdSON.
19 a BY MR. RTcHARDSoN: Mr. voungblood, did
20 you part'icipate in any discussions with Simplot on the
ZL purchase or sale of their facilities charge equipment?
22 THE WITNESS: Is this for me to ansuler?
23 COMMISSIONER SMITH: YES.
24 THE WITNESS: I did participate, y€s.
25 a By MR. RTcHARDSoN: nnd do you recal] the
292 YOUNGBLOOD (X)
rdaho Power company
CSB REPORTING(208) 890-s198
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purchase prices that were discussed?
A r do recall that a purchase price was not
di scussed.
a nnd on page 14, line 8 in your testimony,
you ta'lk about the need to prevent mixed ownership of
facilities; do you see that?
A rdo.
a lnd do you recall that Mr. sturtevant a'lso
talks about mixed ownership in his testimony and he
concludes that it's not such a bad thing?
A t recal'l that he did talk about mixed use.
r don't reca'll whether or not he included the
characterization that it was not such a bad thing or
not.
A But I'm confused, Mr. voungb'lood, about
exactly what mixed ownership means.
A Mixed ownership means facilities that are
J. R. SIMPLOT COMPANY'S MOTION TOTAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
Page 119
Page 51
12051lafn. txt18 beyond the po'int of delivery of the company that are
19 owned both by the company and other facilities that are
20 owned by the customer and that they are intertwined. As
2L Mr. Kline stated earlier, the company desires not to have
22 mixed use faci'lities on an ongoing basis and has made
23 that determjnation some time ago, is in the process of
24 trying to remove a1l mixed use facilities.
25 trle have allowed customers where we
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CSB REPORTING(208) 890-s1e8
293 YOUNGBLOOO (X)
Idaho Power Company
currently have mixed use facilities to continue. rt is
our policy not to go further into developing or
increasing the number of nrixed use facilities, and it is
our proposal in this case here with a buyout opt'ion that
the customer would purchase al'l of the faci'lities on the
site so that there's not a pick and choose and pick only
the ones they want to purchase, but they would buy out
all of the facilittes, the company-owned facilities, on
their site.
a can you describe for me a faci1ity that is
on the customer's side -- an rdaho Power-owned facility
on the customer's side of the meter that is subject to
the faci'lities charge, what it would I'ike if it were not
a mixed faci'lity?
A r'm not an engineer or expert on that, but
in the simp'lest form I would say a transformer.
a Rnd a transformer on simplot's property is
not a mixed facility?
A There is a delineation or a point where
from that transformer on would be all customer
facilities, so from the company's point of delivery,
)
:
I:
J. R, SIMPLOT COMPANY'S MOTION TOTAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
eage 120
Page 52
120511afn. txt22 which typically is the property line, if the transformer
23 existed or resided on the customer's side of that
24 property'line and that is the very'last plece of rdaho
25 Power's equipment, that would not be a mixed use
294 YOUNGBLOOD (x)
Idaho Power company
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J, R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICI,AL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
CSB REPORTING(208) 890-s1e8
facility. The customer would take it from that point
forward.
rhe difference would be on a mixed use
facility where there are some, let's say a transformer
and then perhaps some switch gear that is customer-owned
and then perhaps some additiona'l equipment beyond the
switch gear that is company-owned, that would be mixed
use facilities. rhe concerns from the company point of
view is safety of its personnel, maintenance of the
equipment, determining which equipment is our equipment
or the customer's equipment. rhere have been incidences
and in fact, incidences on Simplot's facility where some
equipment has been moved or removed that was
company-owned and the customer removed it. lncidences
like that is not something that the company wants to
conti nue.
A rs there a definition of that term
anywhere that I can look up?
A I'm not au,are of one right now, no.
a who makes the cal] about whether a
facility is mixed or not mixed?
A rt seems fair'ly simple to me that the --
a We11, the reason I ask is you're tel'ling
the customers in your proposed Rule u that if they want
to purchase the facilities they have to purchase all of
Page 121
Page 53
1 them, bund'le.
2 A They have to purchase all of the
3 facilities beyond the company's point of delivery,
4 correct.
5 a md then at the same time, you're offering
6 to continue to create situations where they're
7 potential'ly mixed by offering the service to new
8 customers.
9 n No, no, no. Please understand the company
10 is not proposing any new mixed use facilities at a'll.
11 a But you're still proposing to provide the
L2 facilities charge service.
13 A The company is continu'ing the facilities
L4 charge service as it is current'ly right now with
15 customers on facilities that are beyond the company's
16 point of delivery.
L7 a night; so I've got a transformer on my
18 side of the fence and that's by definition, according to
19 you, not mixed with my other facilities, but if the
20 transformer is another 20 yards into the facility, does
2L that then become mixed?
22 A ur. nichardson, r'm not sure what the
23 difficulty is here. From the company's point of
24 delivery, any company-owned facilities beyond that point
25 that are contiguous with the company's facilities is the
csB REPORTTNG 296 YOUNGBLOOD (X)[phone] rdaho Power company
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICI"AL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 5
Page L22
Page 54
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120511afn. txt
9 over time, so if a customer s,igned a form, let's say a
10 customer signed the form today and that rate was 1.7
11 percent, then a customer if the commission approved the
L2 request by the company to reduce that rate, at a later
13 point in time that rate would go down. If a customer is
L4 different from a schedu]e 19 or a schedule 24 or a
15 schedule 15 or a 41 or special. contract customer 29,
16 there may be a different rate incurred.
L7 a Do you think a customer's consent may be
18 influenced by what that rate is?
19 A The customer would be knowledgeable of
20 that rate at that point in time.
2L a Has that been your experience in the past
22 with your customers?
23 A r have not been out with the customer. r
24 cannot ta'lk to that.
25 a 0n page 19, lines 2 to 6 of your
csB REPORTTNG 299 YOUNGBLOOD (X)[phone] rdaho Power company
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testimony, you state that the vast majority of the
company's other faci'lities charge customers have
apprec'iated and benefited from the company operating and
providing maintenance on facilities that they would have
had to pay for and maintain themselves. Do you have any
evidence supporting that statement?
A rhe evidence that we used to make that
determination was prior to today. we were aware of only
one customer out of the 240 who had issues or reasons or
concerns and that was the simp'lot company. As of today,
r believe we now have two other customers that may have
concerns or issues. We have not talked, to my knowledge
nage 1-25
J. R, STMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
Page 57
120511afn. txt
13 have not talked, to those.customers and helped explain
14 what the benefits are of the facilities charge, so based
15 upon even that, three out of 240 customers, r think r
16 would sti11 say that the vast majority of the company's
L7 other faci'lities charge customers have appreciated and.
18 benefited from the company operating and providing
19 maintenance on faci'lities that they wou'ld have to pay for
20 and maintain themselves.
2L a that's just based upon your assumpt'ion,
22 though?
23 A gased upon the fact that the faci1ities
24 charge has been in place for a number of years, as you
25 have stated, and that we have not heard any other
csB REPORTTNG 300 YOUNGBLOOD (X)[phone] rdaho Power company
1 complaints, yes. the companies who are paying the
2 facilities charge continue to receive the same benefit
3 that they received from the beginning.
4 MR, RTcHARDSoN: Madam chair, that's a'l'l r
5 have. rhank you, Mr. Youngblood.
6 rHE wrrNEss: Thank you.
7 COMMISSIoNER sMrTH: rhank you, Mr.
8 nichardson. Do you have questions?
g coMMrssroNER REDFoRD: r only have one
. 10 question.
11
L2 EXAMINATION
13
L4 BY COI4MISSIONER REDFORD:
15 a rn my 32 years of life, r've heard the
16 word levelized used in many ways, from a level forpage 126
J. R. sIMpLor coMpANy's MortoN To TAKE Page 58
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
12051lafn.txt
t7 levelizing wood to what you're talking about today, te'I1
18 rne what'levelized means.
19 A what r was trying to describe was that --
20 a And r'm sure you did, r just didn't get
2L it.
22 A wel'I, apparent'ly not, but what t was
23 trying to describe was that the revenue that wou'ld be
24 recovered through a non-'leve'lized approach wou'ld be
25 exactly the same as one that would be recovered through a
CSB REPORTING(208) 890-5198
301 YoUNGBLooD (x)
rdaho Power company
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'levelized approach, and in saying that, that means that
in a non-levelized approach, the customer would pay more
in the early years, perhaps paying more -- their bill
would be higher, and over the course of time, it wou'ld
decrease as the investment decreases. rhe levelized
methodo'logy takes al'l of those and takes the -- it
creates or calcu'lates an equal payment --
a The average?
A -- the average for the entire period of
time, very much like, for example, your home mortgage,
that is --
a t don't want to talk about that.
A okay. we'll, yours is probably much
smal]er than mine, unfortunately, but it is the same
amount over a period of time, rather than paying more 'in
the beginning of the 30-year mortgage than it is at the
end.
a why don't you use just the words differing
faci I i t'i es charges pe r year?
A ror which one?
Page L27
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
Pnge 59
120511afn. txt
2l A rt appears either one.
22 A tr'lhat r'm trying to describe is the fact
23 and t think this is something --
24 coMMrssroNER REDFoRD: t understand what
25 you're talking about now, but that was just kind of a
302 YoUNGBLOoD (com)
rdaho Power company
CSB REPORTING(208) 890-5198
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Quip, so you don't need to answer that. thank you. r
have no further questions.
EXAMINATION
BY COMMISSTONER SMITH:
a at the risk of making it worse, r want you
to confirm what r believe t understand.
A okay.
a the chart on page 4 t analogize what it
seemed similar to me was tax depreciation. You can
either take acce'lerated or you can do straight line, but
when you get to the end, yoU've paid the same amount.
A rhat is correct.
a end the only thing that happens if you
change the time frame is that that crossover point moves.
A rhat is correct.
a okay; so what we have, too, then, is a
pool of assets, just like any other uniform system of
Accounts class and assets come in and they get
depreciated over an average life and some are done and
some come in, but it never goes to zero because some are
always coming in.
A Correct.page 128
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
Page 60
120511afn . txt
25 a n'11 right; so another approach if
csB REPoRTTNG 303 YOUNGBLOOD (Com)
[phone] rdaho Power company
1 customers don't 'like a facilities charge is you just ro11
2 all these costs into the revenue requirement number and
3 ca'lcu'late a base rate using the total revenue requirement
4 instead of having separate charges that then are
5 subtracted from the total revenue requirement.
6 n rt could be an approach. The concern is
7 that these are facilities that are so1e1y for the use of
8 specific customers.
9 q so what you were trying to do with the
L0 facilities charge is more closely align the recovery of
11 the expense from the entity who's benefiting from it?
LZ A That is correct. what all of those
13 facilities, including those facilities beyond the point
14 of delivery, so including those faci'lities that are
15 recovered under the facilities charge, all of those are
16 being recovered through base rates, and so is it prudent
L7 for customers under base rates to be paying for
t8 faci'lities that are only used for a particular customer.
19 The company's determinat'ion is that is not prudent and so
20 what we have done is a levelized approach to offset that
2L revenue requirement being paid by the class, so it is an
22 attempt, and it's not perfect 'in timing, but it is an
23 attempt to offset that revenue requirement determination
24 for the class.
25 a And in ratemaking, r always think of it as
304 YoUNGBLooD (com)
rdaho Power company
CSB REPORTING(208) 8e0-s198
I
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Erhibit 6
eage 129
Page 6l
12051lafn. txt
1 more of an art than a science and within any customer
2 rate class there's always the issue and the reality of
3 intraclass subsidies.
4 A lbsolutely. a residential customer who
5 'lives in a subdivision that is very old and has an old
6 transformer may be subsidizing a customer who is in a
7 brand new subdivision with a brand new transformer.
8 cotlMrSSrONER SMITH: Thank you. r think r
9 got it.
10 eny redirect?
11 CO{vlMrSSroNER REDF0RD: Could r have just
LZ one more question?
L3 conrMrssroNER sMrrH: certainly.
L4
15 EXAMINATION
16
17 BY COII{MISSIONER REDFORD:
a So Marshars question that an old resident
19 might be subsidizing --
18
20
2L facilities.
CSB REPORTING
22 a coMMrssroNER REDFoRD: -- may be
23 subsidizing a resident with new facilities; correct?
24
25
coMMrssroNER sMrrH: R resident with old
A Correct.
q when you're talking about pooling, are you
305 YOUNGBLOOD (Com)
rdaho Power company(208) 8e0-5198
1 talking about pooling assets for a particular company or
2 for the company-wide assets?
eage 130
J. R. srMpI-or coMpANy's MorIoN To rAKE Page62
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
120511afn. txt3 e The company-urride assets of distribution
4 facilities.
5 Q okay; so that could be -- part of that
6 pooling cou'ld be the 1947 whatever and the 2012?
7 A Absolutely, and if the L947 is on the
8 books and fully depreciated, there is no value for
9 that.
10 COMMISSIONER REDFORD: No further
11 questions. r think r'm fully convinced that t'm
LZ confused.
13 CO!4MrSsroNER SMrTH: Mr. williams.
L4 MR. idTLLIAMS: Yes, Madam Chair, just a
15 few redirect questions.
16
L7 REDIRECT EXAMINATION
18
1.9 BY MR. WILLIAMS:
20 a ur. Youngblood, has the company used a
2L levelized ratemaking approach in depreciating its assets
22 at the nells canyon generating station?
23 A r do not believe so.
24 a so any comparison between using a
25 levelized approach that we use for a facilities charge
CSB REPORTING(208) 890-s198
306 YoUNGBLooD (com)
Idaho Power company
1
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and how we depreciate assets at Hells canyon wou1dn't be
appropri ate?
A Correct.
coMMrssroNER REDFoRD: well, that's
because rdaho Power owns the fac'ilities; is that correct?
MR. WILLIAMS: Is that for me or him?
Page 131
J. R. SIMPLOT COMPANY'S MOTTON TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
H
Page 63
1205Ilafn.txt7 THE WITNESS: the Company owns all of the
8 faci'lities, including those that are being charged the
9 facilities charge.
10 coMMrssroNER REDFoRD: This is generating
11 down into a discussion, r apologize. zip it up, right?
tZ a By MR. wTLLTAMS: Mr. voungb-lood, you
13 talked about this pooling of assets of 31 years, is it
L4 normal to expect that some of the assets within that pool
15 will survive the 3l-year average?
15 A Absolutely.
L7 A lnd is it norma'l to say that some of those
18 assets will last less than 31 yearsT
19 A Yes.
20 q lnd the facilities charge customers get
2l the same level of service for their facilities regardless
22 of the age of those facilities?
23 A Yes.
24 a Does the Company's cost to operate and
25 maintain facilities disappear once a particular asset is
csB REPoRTTNG 307 YoUNGBLooD (Di)[phone] rdaho power company
1 fully depreciated?
2 A No, the operation and maintenance expense
3 continues on.
4 Q other than the handful of special
5 contracts the company has, does the company perform
6 individual revenue requirements for individual
7 customers?
I A No.
I Q Are you aware of whether or not this
10 commission has approved that type of methodology?
eage 132
J. R. sIMpLor coMpANy's MortoN To rAKE Page 64
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
A r #ort#'#d,t:
L2 a under the currently approved tariff on
t3 file with the commission, isn't it true that simplot has
14 the option to have the company remove the facilities and
15 it can install its own faci'lities to do away with the
16 faci'l'ities charge?
L7 A Yes, that is correct.
18 a md isn't it true that in this case the
19 company is providing an additional alternative wherein
20 simplot can buy out the facilities?
2L A Yes, that is correct.
22 a lnd just to be clear, as far as the
23 existing facilities charge rate, what the company is
24 proposing is a reduction to that rate, the current rate;
25 is that correct?
) CSB REPORTING 308 YOUNGBLOOD (Di)l [phone] rdaho power Company
1 A That is correct. For all three of the
2 rates, y€s.
3 MR. WTLLIAMS: tto further questions,
4 uadam chai r.
5 COMMISSIONER SMITH: Thank you, and thank
6 you, Mr. Youngb'lood.
7 (rhe witness left the stand.)
8 COMMISSIONER SMITH: It iS NOW MY
9 intention to go to the Kroger witness who apparent'ly
10 needs to be done today, and following that, we will go to
11 ur. nichardson's witnesses and get Mr. eut'ler on his way,
L2 and then depending on how long that takes, we will fit in
13 us. uirsh, if necessary, or w'ill she be here tomorrow?
L4 MR. oTT0: she's able to be here
Page 133
J. R. sIMpLor coMpANy's MorIoN To rAKE Prge 65
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
120511afn. txt15 tomorrow.
16 coMMrssroNER sMrrH: Does she plan to be
L7 here?
18 MR. OTTO: Yes.
19 cor$fissroNER surrlt: we1l, we']l see how
20 that goes and maybe we'l'l get you done today, and yes, we
2L are taking a break now until 3:15.
22 (Recess.)
23 coMMrssroNER sMrrH: All right, we're
24 ready to go back on the record. we'1I go to Ms. ry1er.
25 MS. KYLER: Kroger calls t<evin C. Higgins
309 YoUNGBL@D (Di)
rdaho Pover company
CSB REPORTING(208) 8e0-5198
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to the stand.
KEVIN C. HIGGINS,
produced as a witness at the instance of rhe rroger
company, having been first duly sworn, was examined and
testified as follows:
DIRECT EXAMINATTON
BY MS. KYLER:
a Please state your full name and spe11 your
last name for the record.
A My name is revin c. Higgins,
H-i -g-9-i -n-s .
a ey whom are you employed and in what
capaci ty?
A I'm a principal in the firm Energy
strategi es.
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
eage 134
Pege 66
BEFORE THE
IDAHO PUBLIC UTILITIES COMMISSION
cAsE NO. IPC-E-11-08
IDAHO POWER COMPANY
YOUNGBLOOD, REB
TESTIMONY
EXHIBIT NO, 52
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
Page 67
ldaho PowerCompany
|.P.U.C. 1,1o.29. Tadff No. 101 Odoinal Sheet No. M-1
RUIE M
FACIUTIES CHARGE SERVICE
This rule applies to elpible oustomers taklng Primary or Transmlssion SeMoe under Schedules
9 and 19 or Transmlssion SoMce under Schedule 24. Eliglble Custorners may request that the
Gompany design, lnetall, orn, and openate tnangbrmers and other ffilitles beyond the Poht of
Delitory thgt are solely provided to me€t tre Cudome/s aeMoe rcqulrcmenb. This servlce ls pmvlded
at the Customele nquest and at tre oplion of the Gompany ln erchange for the Customer paylng a
monthly facllities cha6e to the Company. Prlmary and Tranembelon Servlce level Guetomers not
Sking facllltles charge ssMcc are responsible fur providing the tansfornaton of poiler beyond the
Polnt of Dellvery needed to mcet the Custome/s BeMoo rcqulrements. See Rule B.
l. Gonroatv-Orrned Fadll0ec Bauond0re Polntof Dellvcrv
Under a faollltla dtatge anangennnt, the Comparry wlll own and operetB faolll$es beyond the
Point of Dellvery 0rat arc inetalled to solely benefit the Grrstomer, and the Customer wlll pay a
monthly facllltles charg€ to the Company bmed on a peroenhge of the vahe of hE faollltles
installed. As palt of hls anangemenl the Qrsbmer agrses to allor ldaho Porer access to the
Customefs propelty to povide installatlon of faclllties, operaUon and malntenanoe, altemtlon,
relocation, upgrade, converclon, and/or removal in oder b rpet the Custome/s seniice
reQuircments. The Cusbmer agrcesb povide dghb-of-wayas ou0ined in Rule C.
Company-oruned ftcl!ilies beyond the Point of Dolivery will be set forth ln a Disttihlion Faeilities
lnvestmant Report (DFl) pulded to he G\stomer. As the Cqnpaq/s inwghpnt in facilltles
beyond the Polnt of Ddlvery changes ln olderto meet the Custome/e servlce requlrements, the
Company shdl notlfi the Customer of the addifrone andlor deletbns of facilities by fonrardlng to
the Customer a revised DFl. The Company wlll also adlust the monthly fadlities chaqe to be
paid by the Customer bmed on any increase or decrcase ln the value of the Company-owned
fiacllltles resuftiqg from additlons and/or deleffons as set forttr in the rcvised DFl.
Alteratlon and Fdlure ot.Gomoannr0rned F.ecllltles
ln the event the Gustomer requests the Gompany to alter (rcmove, reinstall, or change)
Compeny-owned faclllils beyond the Folnt of Delivery, the Custonpr ehall pay tothe Gompany
the "nonsalvaUe cost' of sudr removal, relnstallation, or ohange. Non.oalvable cost a8 uged
hemln is ompdsed of the btal deprechted msts of matedals, lahr, and overtreade of lhe
facllltles, less the differene betuoen the salvable cosfl of material removed, and mmowl labor
cost inoluding appropdab overhead costs.
Falled equignent will b€ replaced by the Company ft part of provtdlng ongolng operaton and
malnbnance of Company-owned facllfties lnstalled beyond the Foint of Dellvery. When a hlM
piece of equipment is eplaced by the Company. the value of he fallEd piece of equlpment will
be removed from the Gustomefs DFI anC replaoed wtth the value of the new plece of equlBment
to calculate the Customefs monthly facilities charye.
Erhlblt No. 52
Case No. IPC-E-I1-08
M. Youngblood, IPC
Page I of3
IDAHO
lssued per Order No.
Effective - Jariuary 1, 2012
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
lssued by IDAHO POWER COMPANY
Gregory W. Said, Vice Prceident, Regulatory Affairs
1221 Wst ldaho Streeti Boise, ldaho
Pege 68
ldaho PolorCompany
|.P.U.G. No. 29. Tariff No. 101 Orhlnal Sheet i6. i{-2
RULEM
FACLmES CHARGE SERVTCE
Sllo of 9omornv-Qrned Faclllfiee
Custorprs paying a fadlities cfurgp may rcquest to
lnstalled bepld the Polnt of Dellvery. All galEs of
Commiseion and mert thE fulloadng provlslonc:
ldaho Code Section 61€i18.
No mbod ownershlp of facllities. A Guelomer purchaslng Companyourned facltltles
lrtstalled beyord thE Polnt of Dellvery mtnt purctrase allfacllltles [st€d on the DFI fur
that locatbn.
The Customer must go\ride the operafion and malrGnance of all facill0ee installed
beyond $e Polnt of Delivery after the sale is oomplete.
The Cusftomer must pr€Fy englneering ooetE br salee detominaffons taldng greater
than 16 otlmated houre of prcpanatlon. Sales debrminatlonE equal to or less than 16
esfrmated hours of prepardon will b€ U[ed to the Gmtomsr as part of the sales
agreernent, or after he englrcerlrq ls ompl$d h lnshrces whep the eale ls not
linetizEd.
tlonthlv Fadlltlcs Gharoe Rate
Effuc0ve January 1,2012, a facilides charge, as speoiFed in Sclredule 6€, willbe assessed on
each facllitles drarge custome/s monthly biltng.
Coment ahd Ackrowledoe Form
Priorto enterlng inb a faolltfres charge amangernent, the Gustomer and Companymud agrae to
and sign the Facllilies Charye Selhe Consent and Ac*nowledgement Form attached tc this
rule.
purchase Gompanyowned .fadlltEs
facilities must be apPoved by the
a.
b.
)4.
Exhlblt No. 52
Case No. IPC-E-I1-08
M. Youngblood, IPC
Page2 of 3
rDAr-to
lssued per Order No.
Effective - January 1,2012
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
lssued by IDAHO POWER COMPANY
GregoryW. Said, Moe ftesldent, ReguhtoryAfrirt
1221 West ldaho Street, Bolse, ldaho
Page 69
ldaho Power Company
|.P.U.C. No. 29. Tariff l,lo. 101 Orioinal Sheet No. lrl-3
By signing thb form, ldaho Power Company ("ldaho Porcf) and
("Customef) hereby consent to and admoruledge the following:
1. ldaho Porprwilldeslgn, lnstall, own, and operab transfomers and otherhclllties on the
Custome/s proporty whlch are beyond ldaho Porver'a Polnt of Delivery and are solely prodded to med
the Custome/s serulce requirements at the folhwlng Customer location:
2. Thls seruhe is provided at the Orcbmer's requcot and at fte optlon of lddto Poupr ln
erchange br the Customer payrng a monhly fadlltleE charye to ldaho Powsr as lFted in Schedule 66
of ldaho Powe/s cunent and efiedive tailff.
3. ldaho Porcr and the Customer @roe ttlat thls anangement ls provlded under the terms
and oonditions of Rule M, Fadlitbs Charye Sen lce, of ldaho Pouer's cunent and effedive tartfr.
IlaEd:
IDAI-IO POWER COMPANY CUSTOMER
RULE M
FACILITIES CHARGE SERVICE
ldaho Poupr@moany
Facllities Chame Sarvlca
Consent and Acknowledoement Form
Exhibit No, 52
Case No. IPC-E-I1-08
M. Youngblood, IPG
Page 3 of3
IDAHO
lssued per Order No.
Effedive - Janu*1 1, 2012
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 6
lesued by IDAFIO POWER COMPANY
GregoryW. Said, Mce President, Reguhtory[ff46
1221Wed ldaho Sbeet, Bolse,ldaho
Pagc 70
EXHIBIT #7
J. R. SIMPLOT COMPANY'S MOTION TO
TAKE OFFICIAL NOTICE AND/OR OFFER
INTO EVIDENCE
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 7
20
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120511afn. txt
CSB REPORTTNG 339 HIGGINS (X)
The Kroger company(208) 8e0-s198
DEL BUTLER,
produced as a witness at the instance of the rndustrial
customers of rdaho Power, having been first duly sworn,
was examined and testified as follows:
DIRECT EXAMINATION
BY MR. RICHARDSON:
A Mr. Butler, would you please state and
spe1l your name?
A oel gutler, B-u-t-'l-e-r.
a Rnd are you the same oel Butler who caused
prefiled testimony to be filed in this docket?
A I .am.
a end you have no exh'ibits to your
testimony, do you?
A NO.
a rhank you. Do you have any corrections or
additions to make to your testimony this afternoon?
A NO.
a Mr. Butler, if I were to ask you the same
Page 161 Prge I
L20511afn. txt
22 questions you were asked in your
23 afternoon, would your answers be
24 A Yes, they woujd.
25 MR. RTCHARDSON:
CSB REPORTING(208) 8e0-5198
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prepared testimony this
the same?
uadam chair, r move that
HIGGINS (X)the rroger company
340
the prefi1ed testimony of Mr. But'ler be spread upon the
record as if it were read in full.
COMMISSIOf{ER SMITH: Seeing no objection,
it is so ordered.
(rhe following prefiled direct testimony
of ur. oe1 autler is spread upon the record.)
J. R. SIMPLOT COMPANY'S MOTION TO TAKE,
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 7
eage 162
Page 2
1205l1afn. txt
CSB REPORTING(208) 890-5198
341 HIGGINS (X)
The rroger company
1 Q. Please state your name,
2 occupation, and business address..
3 a. My name is oel Butler, Senior Director,
4 Business Development, J.R. simplot company, 1130 west
5 ttighway 30, Pocatello, tdaho.
6 Q. Please describe you educational background.
7 A. I have a gachelors Degree in gusiness
8 Administration, from rdaho state university.
9 a. what is your work experience at the l.R.
10 simplot company?
11 A. r have worked for the l.R. simplot company for
LZ 39 years. r was the Plant Manager at the oon P'lant in
13 pocatello for nine (9) years, from L998 to 2007.
L4 a. what is the purpose of your testimony?
15 A. the purpose of my testimony is to provide
16 customer insight into the rdaho Power faci'lities charge
Ll for equipment located on our property and express my
18 concern over what t consider to be an unfair business
19 practice.
20 a. Please explain in genera'l terms the location
2L and products produced at l.n. Simplot company's Don
22 plant, which takes service from rdaho Power as a specia'l
23 contract customer.
24 A. rhe oon plant, located in pocatello, rdaho
25 produces a fu'l'l f ine of agricu'ltural phosphate
CSB REPORTING 342 BUTLER (Di)
[phone] rcrP
J. R, SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 7
Rage 163
Page 3
120511afn . txt
1 fertilizer.
2 Q. How many peop'le does the oon plant emp'loy?
3 a. The plant employs 350 to 360 regular employees,
4 with seasona'l employment peaking around 450 to 500
5 workers in late spring.
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CSB REPORTING(208) 890-s1e8
BUTLER (Di)
ICIP
a.How much
343
electricity does the oon
eage 164
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 7
P'lant rece'ive
Page 4
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from tdaho power a1205L'1rafr'txt
A. we routinely consume approximately twenty-one
(21) megawatts.
a. ooes the oon plant pay rdaho power a faci'lities
charge for e'lectrical distribution equipment installed
and maintained beyond the point of delivery by rdaho
power?
A. Yes.
a. what types of equipment are inc'luded 'in the
tdaho Power facilities charge?
A. the charge includes typical higher-voltage
equipment such as transformers, switches, power po'les,
and wiring.
a. Cou'ld you explain your understanding of the
facilities charge when you were the plant Manager at the
Don Plant?
A. ls t understood it at the time, whenever we
needed equipment such as transformers, po1es, or
switches, we would contact rdaho Power and they would
provide this equ'ipment with no up-front charge. The
cost of the equipment plus instal'lation would then be
added to the bill as a facilities charge. rn effect, the
newly installed piece of equipment would become leased
equipment. rdaho Power was responsible for servicing and
344 oe'l aut'l"., ,, ,arl
1 maintaining the equipment. rf the equipment failed and
2 required replacement once again, the asset would be
3 retired, the remaining book value would be zeroed out and
4 a new faciiity charge would be estab'lished based upon the
5 cost and 'installation of the new equipment installed in
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 7
page 165
Prge 5
120511afn. txt6 place of the o'ld equipment.
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345 De] gut'ler, oI 1
rCIP
1 Q. could you exp'lain your current understanding of
2 the facilities charge?
3 a. As I understand it now, once a p'iece of
4 equipment gets added to the facilities charge, we pay a
5 20.4% annual fee every year, forever. rt never gets paid
6 off and we do not have the option to pay it off.
7 Additionally, if we ever wanted to purchase our own
I equjpment, tdaho Power has provided no reasonable
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 7
page 166
Page 6
!
i
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120511afn. txt9 opportunity for us to do this. Essentia'|1y, we have
10 choice and no options and we are stuck paying 20.4%
11 annually on an ongoing basis.
L2 a. Do you know holl much the origina'l equipment
13 cost rdaho Power including 'installation?
L4 A. r do, now. rhe tota'l amount for the Don P'lant
15 is $2,619,846,62.
16 a. HOw much does the Don Plant currently pay in
L7 facilities charges annually for this equipment?
18 A. tlle pay $534,448.7t annua1ly.
19 a. what is the average age of the faci]it'ies
20 charge equipment at the Don P'lant?
A. The average age of the rdaho Power equipment at
the oon Plant is 24.5 years. we've got sixty-three (63)
pieces of equipment that were 'installed in 1964,
24 forty-seven C47) years ago. r understand that rdaho
25 Power has informed us in this case that the annual rate
346 oel sutler, Dr 2ICIP
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at the oon Plant has been 20.4% since L976, and was 15%
annually from 1964 to L976. For the equipment dating
back to L964, we have paid $534,330 to date for equipment
that cost $75,79Linstalled. t'le have paid for these
sixty-three (63) items more than seven (7) times already.
a. what is the total dollar amount that the oon
plant has paid to rdaho Power for facilit'ies charge
equipment currently installed?
/
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/
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE ANDiOR OFFER INTO EVIDENCE
Exhibit 7
eage 167
120511afn. txt
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oel sutler, Dr 2a
ICIP
1 A. J.n. Simplot Company has been paying a
2 facilities charge at the Don plant since 1964, for the
3 past forty-seven G7) years, on equipment that was
4 instal'led as early as 1964. We have estimated, based on
5 the historic rates rdaho Power has provided to us in this
6 case, for $2.6 million in currently installed equipment,
7 we have now paid $10,027,224. rhis does not include the
I time-value of money, and if we included that, the actual
9 cost would be much h'igher.
10 a. How did you become aware of the faci'lities
1.1 charge?
L2 A. I have always been aware of the facilities
L3 charge at the Don Plant, but the ful1 extent of this
14 unfair business practice was brought to my attention this
15 fiscal year by our corporate Energy Manager, Don
347
J. R. SIMPLOT COMPANY'S MOTION TOTAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 7
Page 168
I
:
II:
:'\16 sturtevant.1205l1afn.txt
Has Idaho Power everL7o.requested your written
r.n. Simplot company to18 consent, as a plant manager at
L9 install any facilities beyond
20 your p'lants?
the point of delivery at
2t A. No. I have never given forma'l
22 understood the faci'lities charge equipment
23 charged an annual 20.4% fee, never be paid
24 no option to be paid off ever.
25 a.Are you aware of such consent given by any
348 oel gutler, Dr
1 other l.R. simplot company officia'ls?
consent that I
would be
off, and have
J.R. Simplot
that conduct
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 7
A. NO.
a. what insurance requirements does
4 company require of electrical contractors
5 work on its property?
6 A. The J.R. simplot company requires al1
7 contractors, electrical or othervuise, to prov'ide a $5
8 mil'lion insurance Iiability policy.
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120511afn . txt
349 oel gut'ler, ot 3aICIP
a. Does rdaho Pourer's ownership and management of
electrical equ'ipment on plants owned by t.n. simplot
company concern you from a liability perspective?
A. lbso'lute'ly. rhe safe and reliable operation
of the facil'ity could easily be impacted by the
interruption of power and the liabi'lities that go along
with that'loss.
a. Do you think it is fair for rdaho Power to continue
charging the facilities charge rate for rdaho Porer's
initia'l investment made an average of 24 years ago?
A. NO.
a. rdaho Pou,er has offered a reduction in the
annual facilities charge fron 20.4% of the init'ial
investment to 17.00%. please explain your thoughts on
that.
A. ror the Don P'lant, we have paid for this
equipment many times a'lready. simply providing a smal'l
reduction 'in the rate is not fair.
a. when you were responsible for the Don Plant
operations, what was your understand'ing of the options
prov'ided by rdaho Power's facilities charge for the
customer to stop pay'ing the charge?
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 7
eage 170
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A. r betr.tffit'hTft'htJ[ were no options and that
we were required to pay the facilities charge.
A. what is your current understanding of simplot's
350 De] gutler, or 4
ICIP
1 options regarding the facilities charges?
2 A,. We current'ly do not have any option other than
3 to require Idaho Power to remove their facilities and
4 replace their system with our own. However, as r
5 understand it, l,ue must pay rdaho Power for the rema'ining
5 book va1ue, plus the cost to remove the facilities, minus
7 a credit
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J. R. SIMPLOT COMPANY'S MOTION TOTAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 7
Rage 1-7L Page I I
120511afn. txt351 De] autler, ot 4IcIP
1 for the salvage value of the equipment, if any. rhis
2 would be a substantial cost and would not be a
3 financial'ly respons'ib'le alternative.
4 Q. Do you consider it fair for rdaho Power to
5 refuse to sell the equipment to you at a fairly
6 negotiated value?
7 A. No.
I e. If you had the choice, how would you propose
9 rdaho Power address the problems you see with its
10 facilities charge?
11 A. we have paid for our current facflities-charge
L2 equipment more than three times already at the oon plant.
13 r believe that rdaho Pou,er has already recovered its
14 initial costs and any authorized rate of return several
15 times over. nt this point, it would only be fair to
16 simply turn ownership of these facilities over to J.R.
tl S'imp'lot company.
18 rn addition, I believe it is imperative that the
19 commission seriously reform the facilities charge
20 structure and stop this unfair business pract'ice. r
2L fu11y support the recommendations contained in the direct
22 testimony of or. Don neading, which would make the
23 monthly charge fair for those customers who wish to pay
24 it and wou'ld prov'ide reasonable mechanisms by which
25 customers may take over ownership of equipment on their
352 oel sutler, Dr r*l
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 7
eage L72
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12051lafn. txt
own property.
a. ooes this conclude your
A. Yes.
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testimony?
3s3 De1 But'ler,DI 5
rCIP
1
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3
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER TNTO EVIDENCE
Exhibit 7
(rhe following
MR. RICHARDSON:
eage 173
proceedings were had in
r,ladam chai r, rtlr. Butl er
Prge 13
120511afn . txt
4 is availab]e for cross-examination.
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COMMISSIONER SMITH: Thank you. Mr.
MR. oTTo: No questions, Madam chairman.
CoMMISSIONER SMITH: All right, tlr.
MR. NELSON: No questions.
COITIMISSIONER SMITH: O.Isen.
MR. OLSEN: No questions.
CoMMISSTONER SMITH: rurdy.
MR. PURDY: None. thank you.
CO$4MISSIONER SMITH: TIein?
MR. KLEIN: None, thanks.
COMMISSIONER SMITH: On the Company.
MR. wrLLrAMs: Yes, Madam chair, just a
CROSS.EXAMINATION
23 BY MR. WILLIAMS:
a Good afternoon , Mr. But'ler.
A cood afternoon.
354 oel sutler, ot 6a
ICIP
1 Q Your testimony states that you're the
2 former manager of the S'implot oon p'lant; is that
3 correct?
4 A That's correct.
5 a Rnd in what years were you the plant
6 manager?
7 A rrom 1998 to 2007.
eage L74
J. R. SIMPLOT COMPANY'S MOTION TO TAKE Page 14
OFFICIAL NOTICE ANDiOR OFFER INTO EVIDENCE
Exhibit 7
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1205l1afn. txt
8 Q okay. trlhat does the term or phrase
I "specia'l contract" mean to you in the context of your
10 electric ut'i1ity bi'lls?
11. A r don't know that it necessari'ly --
tZ MR. RTcHARDSoN: could you give me a
13 reference to the testimony?
L4 MR. WILLIA!4S: I'm just asking if the
15 phrase "special contract" means anything to the witness.
16 r'm not asking about his testimony.
L7 MR. RICHARDSoN: I'm just wondering where
18 in his testimony you find that.
Lg MR. WILLTAMS: t'11 rephrase the question,
ZO uadam chair.
2L CofI{MTSSIONER SMITH: thank you.
22 q BY MR. WILLTAMS: Are you aware that rdaho
23 power has a specia'l contract with sirnplot for the
24 electric service it provides to the oon plant?
25 A t don't know that r would characterize it
CSB REPORTING 355 BUTLER (X)[phone] rcrP
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as special. r was aware of the working agreement that
we've had with Idaho Power for a number of years from
working at the oon plant.
a so are you aware that the most recent
spec'ial contract between rdaho Power and simplot for
providing electricity service to the Don plant was
negotiated in 2004?
A r don't know that r would characterize
that there was a special contract, once again.
a Are you denying that a special contract,
schedule No. 29, exists between rdaho Power and simplot
eage 175
J. R. SIMPLOT COMPANY'S MOTION TOTAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 7
Prge 15
120511afn . txt
LZ for the oon plant?
13 A r'm not denying that there was one that
L4 existed. rt's not one that r had seen.
15 a so to be c1ear, you were the p'lant manager
16 during 2004, but yet, you weren't a party for simplot's
L7 side for negotiating the terms and conditions of that
18 agreement?
19 A No, r was not.
20 A so then you wouldn't be aware that that
2l special contract explicitly contains a provision whereby
22 the company agrees to provide the facilities charge
23 service and Simplot specifically agrees to pay the
24 facilities charge service?
25 A over a number of years of working within
CSB REPORTING 356 BUTLER (X)
ICIP(208) 890-s198
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the facility r was arvare that there was a facilities
charge. rhe exact circumstances that were and conditions
around that facilities charge were never presented to me
'in writing or asked for approval or sign-off.
a So I guess who at simplot, then,
negotiated that agreement or wou'ld have been responsible
for negotiating that agreement?
A r would anticipate that the individuals
back at that time may have been David Hawk would have
been invo'lved in the negotiation of the contract and then
someone from the senior executive staff with signing
authority would have signed that particular agreement.
MR. WILLIAMS: trto further questions for
this witness, Madam chair.
CoMMISSIONER SMITH: thank you. Do we
eage 176
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 7
Page 16
1205l1afn. txt
t6 have any questions from the commissioners?
L7 coMurssroNen Rebrono: No.
18 COfVIMISSIONER SMITH: my redirect?
19 MR. RTCHARDSoN: t'to redirect,
20 uadam chair.
2t COMMISSIoNER SMITH: rhank you very much,
22 appreciate your being here.
23 MR. RTCHARDSoN: tqadam chair, may this
24 witness be excused?
2.5 coMMrssroNER smrrH: seeing no objection,
CSB REPORTING 357 BUTLER (X)[phone] rcrP
rhic reritnacs is cyrused.
'dS,tllll"J':31'i$ilHt$SRIJ'"##3^"'""r!'r4'
Exhibit 7
Page 17
iii*itis,q"r . r
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EXHIBIT #8.A
J. R. SIMPLOT COMPANY'S MOTION TO
TAKE OFFICIAL NOTICE AND/OR OFFER
INTO EVIDENCE
12051lafn. txt1 facilities subject to the facilities charge, as well as
2 the proper ]evel of the Energy efficiency Rider. My
3 testimony will address these two unresolved issues.
4 Q. Lets turn to the first section of your
5 testimony. cou'ld you please describe the currently
6 effective faci1ities charge on rdaho Power's system?
7 A. For schedule 9, 19 and special contract
8 customer schedule 29, the facilities charge currently is
9 a 20.4% annual charge, which is assessed on customers'
10 bi'lls as a 1.7% monthly charge. the charge is the
11 company's rate recovery mechanism for the company's
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CSB REPORTING 362 READING (Di)
ICIP(208) 8e0-s198
1 investments in company-owned distribution facilities that
2 are on the customer's property beyond the point of
3 delivery. these facilities are usually comprised of
J. R. srMplor coMpANy,s MorroN To rAKf, eage 181 page I
OFFICI.AL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
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120511afn. txtpo1es, wires, transformers, switches, meters, etc., that
are needed to provide power to the customer. rhe
principal investment amount on which the customer is
charged 20.4% annua'l1y is the tota'l of the undepreciated
sum of al'l the investments the company has made in
equipment currently in use at the individual customer's
premises, irrespective of the year the investment was
made. rn other words, the company's facilities charge
imposes a 20.4% annua'l payment on the initial investment
in the company-owned distribution faci'lities on the
customer's property. The principal investment amount
changes only when a new piece of equipment is insta'l'led
or existing equipment is replaced. tf a piece of
equipment is replaced, the investment amount for the
original equipment 'is removed from the investment total
and replaced by the cost of the new replacement
equi pment .1
A. could
recommendation
charge?
A. ASI
recommend that
CSB REPORTING(208) 890-5198
you provide an overview of your
with regard to rdaho powerrs facilities
will explain in more detail below, t
rdaho Power's proposed revised facilities
363 READING (Di)
ICIP
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charge percentage of L7.00ffi should be re-calibrated to
take'into account the'lower rate of return and other cost
components that wi'l'l result from approva'l of the
stipulat'ion in this case. t a'lso recommend that the
commission require the company to calculate the monthly
facilities charge using.the depreciated value of the
initial investment in distribution facilities in
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Rage 182
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1 There is no facilities chalge l,anguage of percentage'rtles cnaroe tanquaoe or oercenTaoed in tariffs for-schedu'leb L, 7, 6rcost of service study in this docketcharge amgunt contained in 15'
howeVer the comoanv's cost of service studv in this dockindicates 5L28,677'(2.U6) of the total facilities charge
revenue is beino collected from customers in these ratescJasses. There-is facilities charge language and the 2O.4%
annual rate contained in schedu'le 24, but there is nofaci'lities revenue collected from that class.
revenue is being collected from. custo4ers in these .ratg9
364 or. neading,
use at a customer's premises, not rdaho Power's existing
and proposed method which ignores depreciation regardless
of the age of the equipment. Further, r recommend that
the commission require rdaho Power to provide customers
with the option to own or purchase faci'lities charge
equ'ipment based on a fair ca1culation of the depreciated
book va'lue of the faci]ities. Fina]ly, r recommend
severa'l changes to the facilities charge tariff and
recommend notices be sent to customers to provide for,
and inform customers of, the charge and the ownership
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J. R. srMplor coMpANy's MorroN ro rAKE eage 183
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Page 3
120511afn. txt11 options.
LZ a. How much does the company receive 'in facilities
13 charges revenue annual'ly?
L4 A. lccording to the cost of service study filed in
15 the current docket, tdaho Power expects to collect
16 $6,020,018 for these faci'lities beyond the point of
Ll delivery from customers for the test year. rhe following
18 pie chart displays the revenue collected from each
19 customer c'lass,
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365 or. neading, Dr 2aICIP
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Graph 1
13 as depicted above, three-fifths of the revenue (61%) is
J. R. srMp,.or coMpANy's MorroN To rAKE rage L84
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Page 4
1205L1afn. txtfrom schedule 19 customers,L4 collected is
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366 Dr. Reading, Dr
with 26% com'ing from schedule 9 customers, and 9% from
the J.n. simplot company special contract schedule 29 for
faci'lities at their Don plant in pocatello. These three
customer classes make up 96% of the total faci'lities
charges col'lected.
a. You stated that rdaho Power is charging
Schedule 9, 19, and 29 customers for company-owned
facilities beyond the point of delivery at a rate of
20.4% annua11y. How does the company derive this 20.4%
rate?
A. when I began investigating the derivation of
the faci1ities charge amount in march 2010, r reviewed
the commission's docket that discussed facilities
charges. r found the most recent commission order
addressing the derivation of the facilities charge was
case No. u-1-006-298 in 1988. rn order 21836 in that case
3
ICIP
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J. R. srMpI,or coMpANy's MorroN ToTAKE eage 185
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Pege 5
12051lafn . txtL7 the commission stated:
18 this case was initiated by rdaho Power's App'lication
19 on August 27, L987, to implement a new'line
20 extension tariff schedu'le No. 71. By order No.
2L 2L475 issued in this case and in rdaho Power's
22 general rate case No. u'1006-265A, we added two
23 additional issues at the behest of several rdaho
24 cities:
25 (1) ere the ex'ist'ing charges in tariff schedules
367 or. neading, Dr 3ICIP
1 15 and 41 providing for L.75% month'ly rate for
2 underground/overhead costs differences in line
3 exteniion requests excessive?
4 (2) Is the existing charge in tariff Schedule 19
5 for 1.7% month'ly facilities charges excessive?
6 rhese issues were residual issues that through
7 inadvertence were unaddressed in case tto.
8 u-1006-265A. No party opposed these existing
9 charges at either the p'rehearing conference or the
10 hearing in this proceeding. The cities did not
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J. R. srMplor coMpANy,s MorroN To rAKE eage 186 page 6
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
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120511afn . txt
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or. Reading, Dr 3ICIP
1 participate in either. rhe staff stated that it
2 reviewed the charges and that the charges were
3 reasonable. lccording'ly, we find that the two
4 charges in question are reasonable and 1ay th'is
5 issue to rest.2
6 rhe cities addressed the facilities charge issue in the
7 original case, however the issue appears to have been
I overlooked and not litigated. there have been no orders
9 sfnce the 1987 review of the methodology, and the
10 methodo'logy and its inputs have been the same for at
LL least the past 23 years.3
LZ a. please describe how the company justified the
L3 20.4% annua'l rate in 1987.
74 A. rhe philosophy behind the deve'lopment of the
L5 facil'ities charge is to calculate a charge to the
16 individual customer that mirrors the costs the Company
L7 would incur for an equivalent investment. the charge is
18 intended to cover costs associated with the investment
19 and operation of distribution equipment on the customer's
20 property such as taxes, operations and majntenance,
2L administration and general, etc., and provide the company
22 with a fair return on its investment just like any other
23 rate based equipment. specifically, the company has
368
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J.R.SIMPLOTCOMPANY'SMOTTONTOTAKE eage 1_87OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Page 7
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determined the
nine elements.
120511afn. txtfacilities charge should
rab]e 1 below indicates
be made up of
the percentage
neading, Dl 3
ICIP
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speci a1
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of
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Agreement, the
369 Dr.
levels for
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each of the elements filed by
2 order No. 21836, case No. u-1006-298 (1988).
3 rn order No. 29576 approving the currently effective
contract between Idaho Power and the J.R. Simp'lot company, the
commission stated, "section 7.2 of the 2004 Agreement sets forth
monthly pacil'ities charge that simplot agrees to pay for the use
the company's distribution facilities. under the 2004
month'ly facifities charge remains unchanged at L.7% per month."
order No. 29576, case No. rpc-E-04-14, at p.2. That order did
analyze the faci'lities charge methodology.
24
J.R.srMpI,orcoMpANy,sMorroNrorAKE eage 188
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Pegr 8
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1205l1afn. txt
370 or. Reading, Dr
Power in case u-1006-298.
Tab'l e 1
summary pacilities charge
costs schedule 19; u-1006-
5a
ICIP
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1 rdaho
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298
nate of Return
oeprec'iati on
Income taxes
Property tax
Other taxes
9.902%
0.560%
2.LL!n6
0.88016
0.250%
1.556%
0.L94%
0.37Y/6
20.483%
Operation & Maint 4,643%
Admin & General
working capital
Insurance
rotal
Monthly Rate L.7196
a. Do you know how the company calculated the rate
19 of return factor of 9.902% used in deriving the 1987
20 facilities charge from Case No. u-1006-298?
2L A. work papers filed by rdaho Powelin that case
22 indicate that 9.902% was the overall rate of return for
23 the cornpany in 1987. They assumed a capital structure of
24 50P6 debt, LM preferred stock, and 40% common stock. The
25 company used 7.976% for debt, L0.140% for preferred
5a
ICIP
otJ.R.srMpl,orcoMpANy'sMoTroNroTAKf, nage 199OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit t-A
37t or. neading, Dr
Page 9
120511afn. txt
1 stock, and an equity return of 12.25096 for a weighted
2 cost of capital of 9.902%.
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ICIP
1 e. Has the rate of return in the facilities charge
J. R. sIMpLor coMpANy's MorroN To rAKE eage L90 Page l0
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
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120511afn. txt
been 9.902% since 1987?
A. Yes. the company has not updated the charge
since 1987.
a. Is this ca'lculation consistent with the
company's authorized rates of return since 11987?
A. No. rdaho Power's current weighted cost of
capital is 8.18%, and it has been be'low the level used in
the 1987 facilities charge calcu'lation since L994. rn
fact, the rate of return component for the faci'lities
charge has been higher than rdaho power's authorized rate
of return since 1994. t have attached as rcrP exhibit
tto. 302 rdaho Power's Response to rcrPrs production
Request No. 28, wherein ldaho Power sets forth its
commission-approved authorized rate of return fn genera'l
rate cases since 1987. the authorized rate of return tras
set at 9.t99% in 1994, 7.852% in 2002, 8.L% in 2005, 8.L%
in 2007, and 8.18% in 2008. At all times since 1987, the
rate of return component of the facilities charge has
been 9.902%, which has exceeded rdaho Power's actual
authorized rate of return for the'last 17 years, at times
by as much as 2.05 percentage points.
a. Has rdaho Power explained why 'it has not
'lowered the authorized rate of return in the faci'lities
charge since L987?
l
or. neadingt Dr 6ICIP
1 A. rdaho Power's response contained in rcrP
2 Exhibit tto. 302 is that rdaho power conducted "periodic
3 validations" to verify that the facifities charge was
4 accurate. prior to this general rate case, other
5 representatives of the tctp and I met with rdaho Power toJ.R.SIMPLOTC0MPANY'SMOTIoNTOTAKE eage 191 pagelt
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE -
Exhibit 8-A
373
120511afn. txt
6 discuss this charge and the failure to update the rate of
7 return since 1987. The company indicated they believed
8 that the depreciation rate was set too low at 0.560% in
9 L987, and according to the company, depreciation shou'ld
10 have been set at a straight line value for 31 years at
11 3.226% (1/3L=.03226), eccording to the Company, the
LZ over-statement of the rate of return and the
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374 or. neading, Dr 6
ICIP
1 understatement of the depreciation rate essent'ial'ly
2 cance'led each other out so the impact on the overall rate
3 would not change significantly.
4 q. During those meetings before this rate case,
5 did the company state the charge was stil'l accurately set
6 at 20.4% annual'ly?
7 A. rhe company did provide the rctp with an
8 updated facilities charge ca'lcu'lation based on 2009
J.R.srMpLorcoMpANy'sMorroNTorAKE eage 192 Paget2
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
1.2051lafn. txt
9 actual charges that wou'ld resu'lt in a faci'lities charge
10 rate that wou'ld be essential'ly the same as the one
11 calculated 23 years ago. the rab'le 2 be'low displays the
LZ updated value supplied by rdaho Power prior to this rate
13 case, with the percentage differences from the
t4 calculation approved 'in 1987.
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rab'le 2
(rable contained in hard
copy of transcript.)
375 or. Reading, Dr 7a
ICIP
1 Q. Has the company filed for a new facilities
2 charge in thts general rate case?
3 e. Yes. The company has proposed a new faci'lities
4 charge calcu'lation, which is set
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J.R.SIMPLOTCOMPANY'SMOTTONTOTAKE eage 193 paget3
OFFICIAL NOTICE AND/OR OFFER INTO EVIDf,NCE
Exhibit 8-A
12051Iafn. txt
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376 or. neading, Dr 8 \ ircrP I
1 forth in tilr. scott sparks oirect testimony and Exhibits.
2 rhe company's proposal before the commission in this case
3 is to lower the percentage rate, and it therefore appears
4 to concede that the 20,4% charge has been set too high.
5 Q. what is the company's proposed revtsion to the
6 charge in this case?
7 A. For schedule 19, the company has proposed a
8 rate of 16.92% rounded up to 17% annually, or L.4L%
9 monthly, and still proposes to assess that charge as a
10 monthly percentage of the undepreciated initial
11 investment in all distribution facilities instal]ed at an
L2 individual customer's premises in the month of the
13 charge. Because the Company's charge for Schedule 9
14 cross references the charge for schedule 19, this 17%
J.R.srMpLorcoMpANy'sMorroNTorAKE rage 194 Prgel4
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE PAgEOFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
costs contained in the Stipulation adopted in this case.
Most importantly with regard to arriving at a fa'ir
ca'lcu'lation of the monthly charge, the principal amount
of the initial investment in distribution facilities must
be depreciated over time as the equipment ages, just as
the principal amount of any other rate based asset
deprec'iates over time. Rs t will explain below, to treat
the facilities charge otherwise woujd result in
individua'l customers subsidizing the rest of the customer
class and, depending on how the over-charge is actua'l1y
credited or not credited to other customers,
/
/
/
120511afn. txt
15 annual charge would also apply to schedule 9. rhe
16 company has also proposed to update the rate for
L7 schedu'les 15 and 4I-, but those parties do not appear to
18 challenge the charge.
19 a. Are you challenging how the company derives
20 the facilities charge in th'is case?
2L A. Yes. e charge of L7% annua'lly assessed into
22 perpetuity against the initial investment 'in equipment
23 that wi'll never be amortized or deprec'iated is an
24 excessive charge. rhe percentage rate should be
25 calcu'lated based on the 'lower rate of return and other
377 or. neading, DI
ICIB
195 Page 15
L2051lafn. txt
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178 Dr. Reading, Dr IICIP
1 may even over-inf'late rdaho Power's revenues for
2 equipment that is partial'ly or whol'ly depreciated.
3 Fina'lly, r recommend that the commission allow
4 certain customers to take over ownership and control of
5 distribution facilities on their property under more fair
6 and reasonab'le terms than rdaho Power has offered to
7 date.
I e. could you please exp'lain in detai'l how the
9 faci'lities charge is calculated and impacts rates?
10 A. according to work papers and discovery
11 responses the company has provided to rcrP in this case,
12 the company appears to derive the facilities charge rate
13 by using costs from distribution facilities equipment on
14 the Company's own side of the meter. The company
15 initially includes al'l of the distribution equipment,
L6 including the equipment subject to the facilities charge
L7 in the Company's rate base. But the Company has
18 identified the components of standard distribution
19 equipment that it believes should be ailocated to an
20 indiv'idua] customer for use of distribution facilities on
2L the customer's own property. the company has used reRc
J. R. srMplor coMpANy's MorIoN To rAKE eage 196 Page 16
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE PAgE 197OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
1205l1afn. txt
Form 1 account figures to calculate the percentage amount
for each identified component that it believes it would
need to recover from an individua'l customer to recover
the amounts that it has placed in rate base for these
379 or. Reading, Dr 8
ICIP
distribution facilities on the customer's side of the
meter. rn that manner, the company ca'lculated the
individual components of the facilities charge set forth
in the tables above, including income taxes, property
taxes, other taxes, operations and maintenance,
administration and general, working capital, and
insurance. Rlong with rate of return and depreciation,
these components make up the company's estimated charge
to the individua] customer for its use of the
distribution facilities on its property.
The sum of these nine components is the annua'l
facilities charge rate. the product of the
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Page l7
1205L1afn. txt
or. neading, Dr 8aICIP
monthly rate and the value of the initial undepreciated
investment in the distribution facilities on the
individua'l customer's property is the customer's month'ly
facilities charge. For example, if the company's total
initia'l investment in equipment in service at a
customer's premises was $100,000, that customer would pay
L.AL% monthly, which is $1,410.00 each month or
$16,920.00 per year, for that equipment and any needed
mai ntenance.
once the company receives the facilit'ies charge
revenue from the individua'l customer, it "credits" that
revenue back to that individual customer's class in the
cost of service model. rn theory, the credit thereby
makes the rest of the class who'le for the distribution
facilities and services already included in rate base for
the whole class. The credit shou'ld direct'ly offset the
cost of the distribution facilities already inc'luded in
rate base for that customer c'lass. r have included rcrp
exhibit uo. 303, which is the company's explanation of
how this "credit" mechanism works in its Responses to
rctp production Request Nos. 6, 7, 46, and 47.
a. vou stated earlier that the faci'lit'ies charge
does not take depreciation into account. Does the
distribution equipment subject to the facilities charge
depreciate in rate base?
or. Reading, Dr 9
ICIP
380
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+
J. R. srMpr,or coMpANy's MorroN To rAKE eage 198
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit E-A
381
Page l8
12051Iafn. txt
1 A. Yes. rhis is the major fai1ure in the
2 rationale of the facilities charge. racilities charge
3 revenues are treated as a credit back to the customer's
4 c'lass, and hence reduce the revenue required from that
5 class when rates are set in a general rate case. As r
6 stated above, the value of the facilities charge revenue
7 and its credit back to the customer class's revenue
8 requirement should d'irectly mirror the costs a'lready
9 included in the customer class's revenue requirement for
10 that customer's distribution facilities. The Company
11 does not account for the fact that the Company 'is
L2 depreciating the same equipment in rate base whi'le at the
13 same time charging individual facilities charge customers
L4 for the accumulation of original, undepreciated
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382 or. neading, Dr
1 costs - irrespective of the age of the equipment. rh'is
J. R. stMpLor coMpANy's MorroN To rAKE eage 199 page 19
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
9a
ICIP
120511afn. txt2 means faci'lities charge customers are compensating the
3 company for a portion of rate base that has already been
4 depreciated. rn some instances, it appears that
5 equipment was fully depreciated by the time the company
6 even began utilizing the facilities charge, yet the
7 company began charging individual customers the
8 facilities charge on the ful'l initial value of the
9 completely depreciated equipment.
10 rcrP discovered this treatment only after extensive
11 discovery requests. r have included, as rcrP Exhibit 304,
L2 rdaho Power's Responses to production Request Nos. 21,
13 22, 23, 24, 25, 45, 60, 64, 65, 66, 67, 69, and 71.
L4 rhrough these responses the company explains the lack of
15 depreciation. rhe Response to rcrP Request tto. 65 is most
16 direct - "The use of depreciated values has never been
!7 approved by the Commission and the company has never used ,,
18 depreciated va'lues to calcu'late monthly faci'lities
19 charges. "
20 a. Do you think this is fair rate treatment?
2l A. No. This treatment either amounts (1) to an
22 unfa'i r subsi dy f rom i ndi vi dual faci 'l i ti es charge
23 customers to other ratepayers, or (2) if the company 'is
24 not crediting the entire amount of faci1ities charge
25 revenue back to the customer class, this treatment cou'ld
383 or. neading, Dr 9a
ICIP
1 be resulting in the company being overcompensated for
2 depreciated assets. rt is not entire'ly c'lear to me what
3 the impact of the charge is on al'l customers. For
4 example, the J,R. simplot company operates its oon plant
5 under a special contract subject to its own rate class -
J. R. srMplor coMpANy,s MorroN ro rAKE eage 200 Page 20
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
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J. R. SrMpLoT COMPANY'S MOTTON TO TAKE page 201OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
120511afn. txt
Schedule 29. rt is not clear how the company credits
back this significant faci'lities charge revenue from this
customer.
q. urhat is the company's just'ification for this
different treatment between the individua'l customer's
faci1ities charge rate and the amount included in that
customer's c'lassts revenue requi rement?
A. the company's just'if ication is not enti re'ly
clear to me. rctp exhibit 304
/
/
/
or. Reading, Dr 10arCIP
contains their just'ification in Response to rcrP
production Request No. 69(b). rhe company stated:
Because the facilities charge ca1culation is
based on a levelized revenue determination method
and base rates are determined using a single test
period method, there w'ill ajways be differences in
the annual revenue requ'irements determined under
each method. These tim'ing differences or
384
Page 2l
12051lafn. txt"subsidies" go in either d'irection for individua'l
customers depending on the average age of the
facilities subject to the facilities charge. For
example, a customer with newer faci'lities will pay
less in faci'lities charges than the actual annua'l
revenue requirement with the rest of the customer
c1ass paying the difference through their base
rates. rhe opposite is true for customers with
o'lder facilit'ies who pay more in facilities charges
than the sing'le-year revenue requirement wou'ld
suggest.4
rhis does not rea1ly explain the need for this
differential treatment, or why the company cannot
calculate the facilities charge based on a single test
period method similar to al'l other rates. tt also
appears to concede that the charge constitutes a subsidy
by individua'l ratepayers whenever that individual
385 or. Reading, Dr 11
ICIP
1 customer's equipment is "older."
2 Q. Do most facilities charge customers have
3 "newer" equipment?
4 A. Not based on the evidence provided by Idaho
5 power. rdaho Power provided the average age of the
6 facilities charge equipment 'in Response to rclp
7 Production Request No. 60, which is contained in rclp
E exhibit 304. The average ages'of equ'ipment for the
9 primary facilities charge customer classes are set forth
10 below:
11 /
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J.R.sIMpLorcoMpANy'sMorroNTorAKE eage 202 pagez2
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
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120511afn. txt
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386 or. Reading, Dr
1 rable 3
2 Customer Class Average Rge of equ'ipment
3 schedule 9 17 years o1d
4 schedule 19 18 years old
5 special contract 24 years o1d
schedule 29
5
7 This clearly shows that on average customers do not have
8 "newer" equipment, and that individual customers are
9 being overcharged for d'istribution facilities on their
10 premises. Rs I explain below, the dol]ar weighted age of
11 the equipment is even older than these average ages for
t2 the customer sites I have ana'lyzed.
13 a. what happens if a piece of facilities charge
L4 equipment fai1s prior to expiration of its assumed
L5 31-year depreciation schedule?
J.R.SIMPLOTCOMPANY'SMOTIONTOTAKE eage 203OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
LI-a
ICIP' 'l
120511afn . txt15 A. egain, this equipment does not appear to be
L7 fai'ling early on average. However, ldaho power and other
18 customers do not appear to lose when equipment fails
19 ear1y. when rcrP representatives and t first met with
20 rdaho Power regarding th'is charge, rdaho Power
2L representatives stated the 'lack of depreciation in the
22 facilities charge was justified in part because ldaho
23 power wou'ld have to replace any equipment that did not
24 last for its full usefu'l 'life. rdaho power be'lieved that
25 if equipment fai'led and had to be replaced prior to the
387 or. Readins, Dr ,lii
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31 years assumed in the depreciat'ion schedule used in the
levelized facilities charge rate, the facilities charge
customer would benefit from tdaho Power replacing that
piece of equipment at no additional cost to the customer.
But this reasoning overlooks three important points. The
'insurance mechanisms and effect of ear'ly fai'lure of
equipment are explained in the companyrs Responses to
ICrP's Production Request Nos. 14, 15, 16, 18, 53, 54,
58, 70, and 73, wh'ich t have included
/
/
J.R.sIMpLorcoMpANy'sMorroNTorAKE eage 204
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit E-A
Prge24
1205l1afn. txt
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388 or. Reading, Dr
1 as rcrp exhibit tto. 305.
2 First, the facilit'ies charge customer pays for
3 "insurance" as one of the components of the faci'lities
4 charge. rdaho Power has stated in discovery that the
5 actual insurance policy, accounted for in the pERc rorm 1
6 account from which the charge is derived, does not cover
7 losses typical with facilities charge equipment. rhis is
8 demonstrated in the Company's Response to rcrPrs
9 Production Request No. 24(c), where the company stated
10 very clearly that it has never made an insurance claim
11 for facilities charge equipment. Because the insurance
L2 charge to facilities charge customers includes a charge
13 for an insurance policy that does not cover facilities
L4 charge losses, that facilities charge insurance revenue
15 should not be considered to be used by rdaho Power to
16 actual1y pay for the insurance policy. rnstead, those
L7 payments for insurance from the facilities charge
18 customer could be considered to be used in the aggregate
L9 to replace any failed equipment.
20 second, rdaho Power has also stated that the
2L replacement costs for facilities charge equ'ipment that
22 fails early are passed onto other ratepayers, including
J. R. SIMPLOT CoMPANY'S MOTION TO TAKE page 205 page 25
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
13
ICIP
\
L20511afn. txt23 the individual faci'lities charge customer, through the
24 company's recovery under its "self-insurance" provisions.
25 rhat is, customers are rdaho Power's "self insurance,"
389 or. Reading, Dr 13aICIP
1 and the customers' rates ultimately make the company
2 whole for any unrecovered expenditures associated with
3 facilities charge equipment which fails prior to the
4 company recovering its fu'|1 expenses.
5 rn addition, it can be reasonably assumed, due to
6 inflation, the cost of the equipment replaced wil'l be
7 more expensive than the older failed equipment included
8 in the total amount of undepreciated company investment.
9 rhe investment amount would 'increase, and the charges to )
L0 the faci'lities charge customer would therefore increase.
11 Thus, in the rare case that a piece of equipment
LZ fai'ls before complet'ion of the assumed 3l-year f ife, the
13 company is kept whole by ratepayers "self-'insuring" Idaho
L4 Power, and the other
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J. R. sIMpLor coMpANy's MorroN To rAKE eage 206 page 26
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
13a
ICIP
ratepayers should be kept who'le by the payments for
insurance on the facilities charge for an insurance
po1icy that does not cover facilities charge equipment
fai1ure. egain, those insurance payments paid by
fac'iltties charge customers are credited back to reduce
the revenue requirement of the customer's customer class.
rn sum, the argument that the equipment might fa'i'l and
have to be replaced prior to the individual customer
paying for it completely through the 31-year leve1ized
facilities charge rates'is simply not a justification for
ignoring depreciation in the facil'ities charge.
a. you stated that some of the equipment that was
in rate base was fu'lly depreciated at the time the
company began charging the facilities charge percentage
of 2O.4% against the initial investment of the fu11y
depreciated equipment. could you provide evidence of
that?
A. Yes. rn fact, the Company admits this is the
case in Response to rcrP production Request tlos. 65, 66,
and 67, contained in rcrP exhibit tto. 304. For example,
rdaho power stated that the oldest piece of facl'lit'ies
charge equipment for a schedu'le 19 customer was installed
in 1945. That piece of equipment was 31 years old and
thus presumab'ly ful]y depreciated in rate base by the
time Idaho Power initiated the facilities charge for
1205l1afn . txt
390 or. neading, Dr
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
eage 207
391 Dr. neading, Dr
1205L1afn. txt
1 schedule 19 in 1976. However, rdaho Power admits that it
2 used the value of the initial investment in that piece of
3 1945 equ'ipment when rdaho Po,uer first ca'lcu'lated the
4 facilities charge in 1976 and has done so ever since in
5 calculating that schedule 19 customer's month'ly
6 faci'lities charge. The same is true for a Schedu'le 9
7 customer still paying a charge calculated against the
E initial investment on a piece of equipment from 1969, and
9 for the simplot special contract schedule 29 customer
10 paying for a 47 year o'ld piece of equipment. rhese items
11 should have long ago been ful1y paid off by rates, but
L2 individual customers are still paying for them.
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or. neading, DI L4
ICIP392
1 Q. Do you
2 customer with very
3 A. Yes. At
J, R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
have any examples of an individual
old faci'lities charge equipment?
the request of one tctp member
eage 208 Page 28
it
120511afn . txt
4 company, the J.R. Simplot company, tdaho Power completed
5 a fu'l'l audit of all of ldaho Power's equipment on
6 simp'lot's property. ls shown in craph 2 be'low the o'ldest
7 facilities charge equipment for which simplot is paying
I the facilities charge dates back to immediately following
9 world h,ar rr in 1945.
10 Graph 2
11
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15 (craph contained in hard copy of transcript.)
16
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or. Reading, Dr 16aICIP
1 The oldest items the company is applying facil'ities
2 charges to are 66 years o1d. rhe items are a transformer
3 and switch insta'lled in 1945 at simp'lot's caldwell p1ant,
4 which is a Schedule 19 customer. As discussed above, a
5 safe assumption would be that the transformer and switch
6 have
J. R. sIMpLoT coMpANy's MorroN To TAKE page 209 page 29
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
7
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2s
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9 schedule 19, or, if
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
120511afn. txt
not proper'ly credfted, the payments
eage 210
\
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394 or. Reading, Dr L7
ICIP
1 long since been ful1y depreciated and taken off rdaho
2 Power's books, y€t Simplot is currently being charged
3 20.4% annually for the origina'l cost of the transformer
4 and switch when installed in 1945. oepending on how the
5 accounting has been handled in the rate proceedings since
6 L976 when the company initiated the facilities charge for
7 Schedule 19, those payments have either been credited
8 back to subsidize the rates of other customers in
120511afn . txt
10 may have otherwise increased rdaho Power's revenues above
11 what should have been authorized.
LZ a. If customers are paying for facilities
13 instal'led as early as 1945, is that when the company
L4 began the facilities charge?
15 A. Apparently not. The Company has expla'ined in
16 Response to rcrPrs production Request ttos. 45 and 64,
L7 which are 'included in rcrP exhibit 304, that company
18 records indicate that facilities charges have in place
19 since rebruary 1995 for schedu'le 9, lanuary 1976 for
20 schedule 19, and 1964 for one spec'ia1 contract customer.
2L The Company explained further that prior to implementing
22 the facilities charge provisions, the costs associated
23 with most customer-dedicated distribution facilities
24 installed beyond the company's po'int of de'livery were
25 'inc'luded in the company's general rate base and al'located
395 or. neading, Dr Ll
ICIP
1 to the associated customer class. rhis would mean, at
2 'least for the transformer and switch installed in 1945,
3 that the J.n. Simplot company began paying facilities
4 charges based on the original cost for a piece of
5 equ'ipment that was 31 years old when the charges began in
6 1976, and for which customers had already paid for 31
7 years.
8 a. ,Do you have any information regarding the tota'l
9 amounts paid in facilities charges and the accumulated
10 original cost of the equ'ipment for any customers?
11 A. The data we have is, again, for the J.R.
LZ simplot company. As shown in craph 3
13/
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
eage 2LL Page 3l
1205LLafn. txt
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J. R. sIMpLor coMpANy's MorroN rorAKE eage 212
OFFICI-AL NOTICE AND/OR OFFER INTO EVIDENCE
Erhibit 8-A
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Dr. Reading, DI L7
ICIP
below, it is apparent that simplot has paid an amount in
facilities charges several times over the cost of
insta'l1ed equipment with plenty left over for fair
operation and maintenance expenses. At two of simplot's
plants, caldwel1 and wsr, simplot has paid in faci'lities
charges more than four times the accumu'lated origina'l
costs of the equipment current'ly installed.
craph 3
(craph contained in hard
396
copy of transcript.)
Prgc 32
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCEExhibit 8-A
120511afn . txt
397 Dr. Reading, Dr 18a
ICIP
a. who decides whether the company can place
distribution equipment on the customer's property and
charge the customer the monthly faci'lities charge rate?
A. Rccording to the company's tariffs, the company
has the sole option to place equipment on the customer's
premises. The tariffs for schedu'les 19 contains the
fo1 lowi ng
/
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/
rage 213 Pagc 33
120511afn . txt
20
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398 Dr. Reading, Dr
1 language:
2 At the option of the company, transformers and
3 other fac'ilities installed beyond the point of
4 De'livery to provided erimary or Transmission Service
5 may be owned, operated, and maintained by the
6 company in consideration of the Customer paying a
7 Facilities Charge to the company.
8 According to this 'language, rdaho Power can place
9 distribution facilities on a customer's premises without
10 even asking the customer for permission to enter their
11 property. edditionally, the company can refuse a
t2 customer's request for the company to provide
13 distribution facilities on the customer's property even
L4 if the customeris wi1'ling to pay the facilities charge.
15 a. Are you aware of whether the company obtains
16 any formal consent from customers prior to placing
17 di stri buti on fac'i 'l i ti es on thei r property and chargi ng
18 the customer for such equipment under the facilities
19 charge?
zo A. r have included rcrp exhibit 306, which
27 contains ldaho Power's Responses to rcrP's production
22 Request Nos. 19, 20, 57, and 72, Those responses exp'lain
J. R. srMpLor coMpANy's MorroN ro 'AKE
Page 2L4 Page 34
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
19
ICIP
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1205llafn. txt
rdaho Power's position on its authority and the
customerrs consent that it obtains. to summarize, rdaho
Power has stated that it on'ly places faci'lities beyond
399 or. Reading, Dr 19rCIP
the point of def ivery after it receives a request from a
customerr but rdaho Power has not obtained written
consent from customers in the form of a uniform contract
or otherwise. rdaho Power believes a customer's request
and the tariff itse'lf provides it with adequate legal
permission'to enter onto a customerrs property and to
subject the customer to the facilities charge for
whatever equipment the company chooses to place there.
tn 2010, rdaho Power began requesting that customers s'ign
a "service Request form" indicating that the faci'lities
charge wil'l be added or adjusted on a monthly potver bill.
However, even this form does not contain any express
explanation of the charge that would a'llow customers to
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J. R. sIMpLor coMpANy's MorroN ro TAKE eage 215
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
f,xhibit 8-A
L2051lafn. txt
400 or. neading, Dr 19
ICIP
1 understand they are agreeing to pay 20.4% annua'l1y on the
2 initial investment of an asset that will never be
3 depreciated.S A'lso, rdaho Power has not stated that 'it
4 keeps any forma'l record of customer "requests" prior to
5 2010.
6 a. can customers purchase the distribution
7 facilities on their property for the remaining book value
8 in order to stop paying the charge?
9 A. rdaho Power does not appear to be allowing that
10 option at this po'int in time. r have attached rctp
1L Exhibit tto. 307, which conta'ins the company's Reponses to r \
L2IcIP,sproductionRequestNos.9,1o,11,and68onthis..-)
13 issue as we'l'l as correspondence between the ICIP
t4 representatives and ldaho Power representatives in the
15 year prior to this rate case. the company a1'lowed one
16 customer - the sinclair oil company dba Sun Va11ey co. --
L7 to purchase distribution facilities at remaining book
18 value in case No. rPc-E-05-16. However, the company has
:19 now taken the position that it wi'll not sell distribution
i20 faci'lities to other customers. i
2L a. Are you aware of any customers who have tried
22 to take over ownership and control of a'11 distribution
23 facilities on their prem'ises and thereby stop paying the
24 charge?
25 A. Yes. As described in greater detail in rctp
401- or. Reading, Dr 19ICIP l
?
J.R.srMpLorcoMpANy'sMorroNrorAKE Rage 216 page36
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
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witness Don sturtevant's Direct restimony and evidenced
in letters and emails contained in rcrP exhibit t'to. 307,
there were discussions in the past year between simplot
and rdaho power for the potentia'l sale of the facilities
subject to the faci'lities charge. During the course of
the discussions rdaho Power made the dec'ision that it
would not be w'illing to sell the facilities, at any
price, to the customer. rdaho power stated that the
factors that went into that decision were: (1) the
Company's statutory ob1'igation under t.c. 61-328 to
hold other customers harm'less in se'lling utif ity owned
assets; and (2) the way the company runs its business as
a regulated public utility.
/
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/
see rcrP exhibit No. 306, p.6.
402 or. Reading, Dr
1 Q. Please
2 company believes
J, R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
explain your understand'ing of why the
it cannot hold other customerrs harmless
eage 2L7 page37
20a
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J. R. srMp,,or coMpANy,s MorroN ro rAKE Page 2LB
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
120511afn . txtin a sa'le of the assets at book value?
A. According to ldaho Power, any reduction in
facilities charge revenue through the sa1e or removal of
the company's equipment wou'ld result in significant
increases in rates for the customer class that was being
credited with those specific facilities charge revenues.
Because of the credit back to the customer class's
revenue requirement, rdaho power beiieves that a
reduction in facilities charge revenue after the sale of
the facilities charge equ'ipment would result in a
corresponding increase in the revenue requirement for
that customer c'lass.
This approach ignores the other side of the
facilities charge equation. For example, should the
customer purchase the facilities, the rate base and
maintenance costs assigned to that customer class would
be reduced because the company should remove the
equipment from the revenue requirement altogether. rf
the company no longer owned the faci'lities, then it would
no longer incur the other costs that are used in the
ca1cu1ation of the facil'ities charge. rhe charges that
should no longer exist anywhere in the company's revenue
requirement would include taxes, insurance, operations
403 or. Reading, Dr
and maintenance, administrative and genera'I, and working
capital. The customer class's revenue requirement would
be "credited" with the book va1ue "sale price" paid by
the individua'l customer, and the class would thereby be
kept who1e. For longer lived assets discussed above
dating back to 1945, the customer has pa'id for the
20a
ICIP
120511afn . txt7 equipment severa'l times over and has been subsid'izing
8 other ratepayers. rf the facilities were so'ld for their
9 depreciated va'lue of zero do1'lars, the company and other
10 customers wou]d sti'lI be made whole and the associated
11 costs would cease. Basically, if the faci'lities go away
LZ then al'l the costs should also go away as wel1. rf the
13 customer pays the deprec'iated book value, the two sides
L4 of the equation ba'lance out and shou'ld keep a1l part'ies
15 who'le. But as r testified ear'lier, tdaho Power is
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404 or. neading, Dr 2L
ICIP
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not willing to agree to this arrangement.
a. uas tdaho power provided customers with any
option to ever stop paying the charge once rdaho Power
p'laces distribution faci'lities on the customer's
property?
A. rhe tariff only provides an option for the
customer to pay Idaho Power to remove the fac'i]it'ies.
The tariff for schedule 19 states:
In the event the customer requests the company
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Page 219 Page 39
1205lIafn . txtl-0 to remove or reinsta'll or change company-owned
11 raci'lities Beyond the point of Delivery, the
L2 customer shal'l pay to the company the "non-salvable
13 cost" of such remova'|, reinsta'llation or charge.
L4 Non-salvable cost as used herein is comprised of the
15 total depreciated costs of materials, labor and
16 overheads of the faci'lities, less the difference
17 between the salvable cost of materia'l removed and
18 removal labor cost including appropriate overhead
19 costs.
20 a. How wou'ld that process work?
2L A. r have included rcrp Exhibit uo. 308, which
22 inc1udes the company's Response to rcrP's production
23 Request trtos. 12 and 51 and two letters regard'ing the
24 removal option. To summarize, it would be a time
25 consuming and difficult process for the customer, which
405 or. Reading, Dr ZI.a
ICIP
1 would include shutting off power to the customer's
2 facilities. llthough this option has been 'in place for
3 some time now, it appears that no customers have
4 exercised this option. r am aware that l.n. simp'lot
5 company has expressed interest in exercising this option
6 to the company after the company refused to sel1 the
7 equ'ipment. The company has recently responded with an
8 out'line of a very complicated valuation process to even
9 provide the customer with an estimate of the cost of
10 remova'I. rn fact, the company suggested that J.R.
11 simplot company must pre-pay rdaho Power to even obtain a
LZ removal cost estimate and removal p'lan before they can
13 even determine the cost.
J. R. srMplor coMpANy's MorroN To rAKE vage 220 Page 40
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
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the actua'l removal process may require "multip'le project
plans that reflect phased work efforts." t have included
the company's letter to the attorney assisting l.R.
Simp'lot company, which expla'ins the company's removal
proposal in tclp exhibit rrto. 308.
a. what are your thoughts on that option the
company has provided?
A. rt is entirely unreasonable and unnecessary.
rhe customer has obviously pa'id for its equipment many
times over, and rather than agree to sell the equipment
or arrange some mechanism that wt1l not require
interrupting service, rdaho Power is now insisting on an
unnecessary removal process. rt is not even clear that
rdaho Power wi'Il be able to find a use for all of the
J.R. Simplot company equipment if it is removed, which
would of course increase the removal cost to l.R. simplot
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J. R. srMpt.or coMpANy's MorroN To rAKE eage ZZL
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Page 4l
L205I1afn . txtt7 company. From an economist's perspective, this makes no
18 sense at a'l'l when the equipment is already being used in
19 an efficient manner. rhe company shou'ld not provide
20 removal as the only option because the Company has now
2L proved that it is an unworkable and unrealistic option.
22 there are valuab'le benefits to the customer of
23 owning its own facilities, and the company should provide
24 its customers with a rea'listic and fair opportunity for
25 such ownership. rf a customer owned the faci'lities on
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ICIP
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their property, the customer could maintain them and not
be requi red to compensate rdaho Power for thei r rate of
return. customers could also take advantage of any
depreciation and tax benefits. A'lso, as described in ur,
Don Sturtevant's testimony, there are considerations with
making sure the customer is adequately insured for any
accidents that may occur on its own property, which may
compel certain customers to prefer to own the equipment
themselves.
t understand that when :.R. simplot company
approached Avista utilities with very similar concerns
regard'ing that company's facilities charge for a plant in
washington, Avista
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
page 222 Prge 42
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J. R. SIMPLOT COMPANY'S MOTION TO TAKEOFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
H
1205l1afn . txt
Dr. Readingr Dr 22
ICIP
agreed to sell the facilities to J.R. simplot company and
to reduce the facilities charge to a fair operations and
maintenance level. rt is not c'lear why rdaho power
cannot do the same for its customers.
a. rdaho Power's proposal is to lower the
facilities charge from 20.4% to L7.0eA annuaily. tltthat
are your comments on that proposal?
A. Updating the percentage is a good start, albeit
Iong overdue. A'lso, the company's proposed facilities
charge percentage would need to be reca'lculated to match
the costs contained in the stipulation. ror example, the
proposed facilities charge rate in the rate case filing
was based on the company's current we'ighted cost of
capital of 8.18%. The Stipulation specifies 7.86% rate
of return on page 4. Therefore, the rate of return
component would need to be adjusted downward. Rlso, the
company requested a revenue 'increase of approximately $83
million; the Stipulation reduces that request by $43
million down to $34 million. The corresponding deceases
in the FERC Form L accounts used to caiculate the
fac'ilities charge shou'ld a'lso be updated to ensure that
the charge and its credits back to each customer class
closely match the va'lue of the assets contained in that
eage 223 Page 43
120511afn. txt24 class's revenue requ'irement. rurther, as described
25 be'low, r recommend that the revised percentage be
409 or. neadins, Dr ,11i
1 calculated against the depreciated value of the initial
2 investment using appropriate amortization schedules
3 discussed further below.
4 T also recommend that the commission consider
5 investigating the components of the proposed charge other
6 than the 'lack of depreciation. The FERc Form 1 accounts
7 used for the ca'lcu'lation the faci1ities charges are based
8 primarily on the company's distribution system. However,
9 depending on the customer, the cost to ldaho power for
10 the facilities could vary ' )
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ICIP
J. R. srMp,,or coMpANy's MorIoN To rAKE eage 224 Prgc 44
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
t\
12051Iafn. txt
1 significantly. For example, the operation & Maintenance
2 component charge in the proposed rates is 3.58% which
3 means the company is collecting $1.25 million annua'lly to
4 maintain faci'lities on the customers' properties. Because
5 these facilities are on a customer's property, in many
6 cases, they would require significantly less attention
7 than distribution systems located on public roads or in
8 rura'l areas. E time and materials charge to each
9 individua'l customer may be more appropriate than this
10 system w'ide average ca'lculation. each of the 'individua'l
11 components that make up the faci'lities charge could be
L2 subject to similar ana'lysis. For customers who wish
13 rema'in on the faci'lities charge, t would recommend the
14 Commission open a docket to examine the equity of each of
15 the elements that make up the facilities charge.
16 a. what are your overall recommendations for
L7 changes to the ownership opt'ions for facilities charge
18 equipment?
19 A. over a 15 year time period at an annual
20 interest rate of over 14%, the payback equals 2.5 times.
2t Thus, r propose it would be fair for the company to
22 assign ownership of facilities charge equipment to
23 existing facil'ities charge customers who have paid
24 overal'l facilities charge rates of more than 2.5 times
25 the orig'inal cost for the equipment currently installed.
4LL Dr. neading, DI 23aICIP
1 ror example, the l.R. simp'lot company has paid for theirJ.R.srMpLorcoMpANy'sMorroNToTAKE page 225 page45
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
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1205l1afn. txt
equipment 3.4 times, when a firrn has paid th'is many times
over it wou'ld seem fair that they should be a1lowed to
just assume ownersh'ip. For existing facilities charge
customers who have not paid more than 2.5 tirnes the
original cost, r propose that the company provide such
facilities charge customers with the option to purchase
the facilities at depreciated book value for each piece
of equipment based the Company's Commission-approved
depreciation schedu'le for that specific type of
equi pment.
I also recommend that the commission direct rdaho
Power to implement an ownership option which a1lows the
customer to take over ownership of the equipment and pays
a "limited
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or. Reading, Dr 24ICIP
1 faci'lities charge" for the Company's ongo'ing operation
2 and maintenance expense. This was the resolut'ion that
3 :.R. Simplot company reached amicab'ly with Rvista
4 ut'ilities in washington, and it would likely be useful
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Page 226
120511afn . txt
5 Idaho customers who would l'ike to have tdaho Power
6 continue to operate and maintain the equipment necessary
7 for de'livery to the customer.
8 Q. Do you have an alternative proposa'l for a
9 purchase price if the company believes it is unable to
10 calcu'late the depreciated book value for each p'iece of
11 equipment based the company's commission-approved
tZ depreciat'ion schedu'le for that specific type of
13 equi prnent?
L4 A. Yes. r believe that the remaining book value
15 can be approximated by ca'lculating the initial value of
16 all equipment installed at a customer's facility by an
L7 appropriate depreciation schedule that would apply to a'l'l
tB fac'i'l'it'ies charge equi pment. An appropri ate deprec'iation
1"9 schedule can be estimated by determining the do'llar
20 weighted age of the facilities charge equipment at actual
2L customers' premises with faci'lity charge equipment.
22 calculating the dollar weighted age of the equipment
23 provides a more accurate picture of the economic or rate
24 impact of the equipment's age than a simple average age
25 of the equipment wou'ld provide. Using data supplied by
413 or. Readins, Dr ,31i
1 the J,R. simplot company for the caidwel'l Plant and the
2 Don Plant, r developed a dol1ar weighted age of
3 faci1ities charge equipment. This first requires a
,4 simple calculation of the original cost of the equipment
5 multiplied by the age for each item. Next, t calculated
6 the percent of the total facilities charge do]lar amount
7 for each year beginning when the oldest piece of
8 equipment was insta'lled to the present. The results are
J. R. srMpI,or coMpANy's MorroN To rAKE page 227 prge 47OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibir 8-A
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120511afn. txt
9 shorn 'in craphs 4 and 5 be'lout.
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5 (Graph contained in hard copy of transcript.)
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J.RsIMpLorcoMpANy'sMortoNTorAKE Page 228 Pnge48
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
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12051lafn . txt
eraph 5
(Graph contained in hard copy of transcript.)
415 Dr. Reading, Dr 27
ICIP
1 As can be seen in craph 4 for the caldwell e'lant,
2 approximately half (49.2%) of the cumulative amount of
3 the dollar weighted age of the facilities charge
4 equ'ipment pre-dates !975. rn other words, from a do'l]ar
5 value perspective, half of the equipment was installed
6 prior to 1975. rhat was 30 years after the first piece of
7 equipment was installed by rdaho Power, and 36 years ago
8 from the present. For the Don plant, depicted in craph
9 5, with the first piece of equ'ipment installed in 1964,
10 60oA of the do'l1ar weighted age of the facilities charge
11 equipment predates 1986, which is 25 years ago. The
L2 company uses 31 years in their ca'lculation of the
13 depreciation component of the faci'lities charge rate.J.R.sIMpLorcoMpANy,sMorroNTorAKE eage 229 page49
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
1205l1afn. txt
L4 However, eraphs 4 and 5 demonstrate that,, from a dollar
15 va'lue perspective, much of the equipment at these two
16 actual customer sites is wel'l beyond its 3l-year life
L7 expectancy, and J.n. Simplot company has been paying for
18 much of the equipment long after it has been fully
19 depreciated in rate base. Because these do'l'lar-weighted
20 ages of much of the equipment at these representative
2\ customer sites show that the customer has already paid
22 for fu11y depreciated assets beyond rdaho Power's assumed
23 31-year life, customers shou'ld be entitled to purchase
24 the equipment at the remaining book value on a nore
25 accelerated depreciation scale than tdaho Power's assumed
41-6 or. Reading, Dr ,ll]a
1 31-year scale.
2 Each customer's facilit'ies would have a different
3 dol1ar weighted age profile, but these representative
4 customer sites demonstrate that an accurate calcu'lation
5 of remaining book value would require the company to use
6 a depreciation schedu'le far shorter than 31 years.
7 otherwise, customers will get no cred'it for their ongoing
8 payment for facilities charge equipment that has long
9 been fu11y depreciated. Thus, if rdaho Power cannot
10 ca'lculate the actual remain'ing book value, I recommend
11 for simplification and compromise that customers be
LZ allowed to purchase the equipment from tdaho power at a
13 depreciated book value us'ing a 15-year straight line
L4 depreciation schedule.
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J.R.srMp,,orcoMpANy,sMorroNTo,AKE eage 230
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Prge 50
120511afn . txt
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4L7 or. neading, Dr 27a
ICTP
1 Q. How do you propose the Company modify the
2 facilities charge for those customers who do not want to
3 buy the equipment from the company?
4 A. r recommend that rdaho Power's proposed
5 facilities charge percentage of 17.00% annually be
6 re-calibrated for the costs contained in the stipulat'ion,
7 and going forward be adjusted consistent with genera'l
I rate case results. I also propose that the re-calibrated
9 percentage amount be charged against the depreciated
10 value of the equipment usfng a L5-year straight line
11 depreciation schedule for equipment already insta'lled,
L2 and the company's approved depreciation schedule for the
13 specific type of equipment for any new or replacement
t4 equipment.
15 a. Do you have any other recommendations?
16 A. Yes. r recommend that the commission require
. L7 rdaho Power to inform each facilities charge customer in
L8 writing within 90 days informing customers of the
19 facilit'ies charge and its costs over the life of the
20 equipment and to inform them of their ownership options
J.R.sIMpLorcoMpANy'sMorroNTorAKE eage 231 prgesr
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
1205lIafn. txt
2L outlined above. rhis should include a disclosure showing
22 payoff amounts at different milestones, effective
23 interest rates and other components of the charge and
24 require written consent from the customer. rhe buy-out
25 option described above should be clearly provided for in
418 Dr. neading, Dr 27aICIP
1 the tariff. Also, the tariff itself should state that a
2 customer can choose to own its own distribution
3 facilities, rather than be stated in a manner that
4 appears to provide only the company with the option to
5 decide whether to sign a customer up for the facilit'ies
6 charge. pinally, tdaho Power should alloru for a mix of
7 ownership between the company and customers on customer
I property. that would allow the customer to have the
9 choice of which equipment will be owned by itself or be
10 subject to the facilities charge.
11 a. Does that conc'lude your facilities charge
LZ test'imony?
L3 A. Yes.
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J.R.srMp,.orcoMpANy,sMorroNrorAKE page 232
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Page 52
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
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120511afn. txt
419 Dr. Reading! Dr
a. You stated earlier that you would a'lso testify
as to the rnergy efficiency nider percentage. could
expl ai n that 'i ssue?
A. The current level being collected by the Energy
efficiency Rider (EE Rider) is 4.75% of a customer's base
rates. rhe Company has proposed moving the recovery of
approximately $11.3 million projected for three demand
response programs' 'incentive payments into "normal" base
rates as a net power supply expense rather than being
col'lect through the EE n'ider.6 At the current leve1 of
Company's sales revenue, leaving the EE Rider rate at
4.75% after removing the $11.3 mi'l1ion of demand response
costs would mean rdaho Power wou'ld collect approximately
$7.5 million more than the current level of overall
demand side management expenditures.
Even though some demand side management costs wiIl
be col'lected in base rates rather than through the er
Rider, the overall rate impact of rdaho power's proposa'l
on customers is the same as increasing the nider by $11.3
million. rf the EE Rider is'left at 4.75%, and the
demand response programs are moved to base rates,
customers wou'ld be effectively paying the equiva'lent of a
6,L% EE Rider. A dollar for dollar reduction in the
rider from remov'ing the $11.3 mi'l1ion demand response
incentive programs wou'ld equal an EE Rider of
28
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Page 53Page 233
420 or. Reading, Dr
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approximately 3.8%.
a, what is your recommendation for the treatment
of the EE Rider in this case?
A. l do'l'lar for dol'lar reduction to 3.8% may be an
equitable and justifiab]e path, particu'larly since this
is how t understand the commission treated nocky Mountain
Powerrs EE
/
/
/
rdaho power epp'lication, rPc-E-11-08, p.6.
42L or. neading, Dr 3LICIP
1 Rider after one of
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
its conservation
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programs was moved
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the commission staff's testimony and recommendation of
lowering the EE Rider to 4.0%.
a. ooes this conc'lude your testimony?
A. Yes.
7 Order No. 32196, Case No.PAC-E-10-07, p.26.
422 or. neading, Dr 31alcrP
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2 open hearing.)
3
(rhe following proceedings were had in
MR. RTcHARDSoN: Madam chair, or. Reading
4 is now avai'lab'le for cross-examination.
J.R.SIMPLOTCoMpANy'SMOTTONTOTAKE eage 235OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE -
Exhibit 8-A
Page 55
120511afn. txt
CoMMISSTONER SMrTH: Thank you. Mr. Otto,
6 do you have questions?
MR. orro: unfortunately r do not,
8 Madam Chair. rt's always fun to ta'lk to or. neading.
cotwrssroNER sMrrH: Mr. tte'lson.
1.4R. NELSON: thank you. No questions of
COMMISSIONER SMITH: O]SEN.
MR. OLSEN: No questions, Your Honor.
co[iMrssroNER sMrrH: Mr. Purdy.
MR. PURDY: No questions.
COMMISSIONER SMITH: Mr. Mi.I.IEr? MS.
9
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11 this witness.
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L7 ryler? Nothing from the Staff. How about from the
18 company?
19 MR. WILLIAMS: Yes, Madam Chair, a few
20 questions for or. Reading.
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423 or. neading, Dr 32
ICIP
1 CROSS-DGO4INATION
2
3 BY MR. WILLIAMS:
4 a Dr. Readif,g, r'd just]ike to start on
5 page 1 of your testimony beginning on the quest'ion at
6 'line 19 and going over to the next page, you at a high
7 level describe your interpretation of the facil'ities
J.R.sIMpLorcoMpANy'sMorIoNTorAKE eage 236 Page56
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
1205l1afn. txt8 charge. Do you see that?
I A Yes.
10 a what does simplot get in return for the
11 charge?
LZ A They get the faci'lities that are on their
13 property that are owned by the company, given either all
L4 of it or what's there less what they own, and they get,
l-5 as one of the rdaho Power witnesses said here, they get
16 24/7 maintenance on the equipment if something shou'ld go
Ll wrong.
18 a Do you know whether or not the facilities
19 charge rate includes an element for keeping back-up or
20 spare inventory that's specific to those faci'lities
?L charge customers that are paying the rate?
22 A t'm trying to think. I would have to look
23 closer within the list to knoul whether the back-ups would
24 be included. My first impression 'is they're not, but r,
25 would have to go back to the workpapers supp'lied by the
424 or. Reading, DI
1 company under, for instance, their maintenance charges to
2 see whether there was a FERC account for that that would
3 be loaded into that. I don't recall one.
4 Q Regardless, though, as part of the service
5 the company agrees to replace equipment that fails for
6 fac'ilities charge customers?
, 7 A Oh, certainly, yes.
8 Q r think -- let's turn to page 12 of your
9 testimony. r think there's actua'lly a couple of places
, 10 in here on page 12, beginning on'line 18, where you --
11 r'm sorry, at'line 14 where you allege that if the
J. R. SIMPLOT coMPANY's MoTIoN To TAKE eage 237 Page 57OFFICTAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibir 8-A
-
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32rCIP
120511afn. txttZ company is not crediting the entire amount of the
13 facilities charge revenue back to the customer c'lass,
t4 this could result in the company being overcompensated.
15 Have you or any of the other simplot wr'tnesses provided
16 any evidence at all that that is indeed the case?
L7 A Do you mean numerically or, r'm trying to
18 think, theoretica'lIy or methodologica1'ly? r wou'ld say
19 there's no calculation that r've made, but as t
20 understand the way ratemaking 'is done and the way
2L facilit'ies charges are, there is a mismatch between
22 what's in rate base for that particular class and the
23 level of investment that the facilities charge is
24 calculated on for the individual customer.
25 Let me explain. r think this goes back to
CSB REPORTING 425 READING(208) 890-5L98 rcrP
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commissioner smith's quest'ion that t heard her ask
ear'lier and if you ask me the question when rdaho power
instal'ls a p'iece of equipment or whatever for faci'lities
charges, it takes that tota'l ca'lculated amount and it
would be assigned to rate base, and then in the
ratemaking procedure, given what we argue about in here
a'll the time how the class allocations go for each one of
those, then x percent of rate base would be assigned to
that particular customer class. There is a mismatch in
the fact that when commissioner smith was asking the
question, what happens to that group or collectivity of
rate base items, such as, you know, r'd have to look at a
depreciation study, poles, transformers and whatever, it
goes into rate base.
Year after year there is a depreciation
J.R.srMpLorcoMpANy,sMorroNTorAKE eage 238
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit E-A
Page 58
12051lafn. txt16 calcu'lation, 3.24 percent, 2.4 percent, whatever that
t7 group is, and so in effect, the total amount of rate base
18 that goes in -- that would be assigned to that particular
19 class goes down over time if there were no new
20 investment, and, of course, that's never true, there's
2L new investment, but that amount tends to go down over
22 time, and the origina'l investment amount is depreciated
23 over time, moved to the facilities charge,
24 rn the facilities charge, the original
25 cost of that investment is assigned to that part'icular
CSB REPORTING 426 READING(208) 890-5198 rcrP
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Exhibit 8-A
faci'lities charge customer. That never changes. whether
you ask questions to Mr. Youngblood or rim Tatum and our
negotiations supplied spreadsheets that showed on an
average of 31 years or 32 years that it all comes out
even. rhe difference is that original investment,
whether it was made in 1955 or '76 or whatever! never
changes at a'll, so the percent, this 1.7 percent or this
1.4 percent or whatever, is timesed by this cumulative
amount of origina'l cost rate base over time. that says
to me that the faci1ities charge customer is then pay'ing
for what the equivalent is in rate base for the company,
is "overpaying" and if they're overpaying, that's
constitutes a subs'idy, either interc'lass or intraclass.
a rhanks, 1et's move on. tt is your
testimony, is it not, that rdaho Power should assign
ownership of faci'lities subject to the faci'lities charge
that are fu11y deprecfated?
A wou'ld you repeat that, please?
A rs it your testimony that rdaho Power
Page 239
12051lafn. txt2A should assign ownership of facilities subject to the
2L faci'lities charge that are fully depreciated to
22 Simp]ot?
23 A Yes.
24 a would you agree with me that those fu1'ly
25 depreciated faci'lities are used and useful?
CSB REPORTING(208) 890-s198
READING
ICIP
MR. RTcHARDSoN: laadam chair?
COMMISSIONER SMITH: Mr. nichardson.
MR. RICHARDSON: rs he asking in a 'legal
sense or is he asking in a non-lega1 sense?
MR. IILLTAMS: ttadam chai r, however
or. Reading would wish to respond.
coMMrssroNER sMrrH: Dr. Read'ing.
THE wrTNEss: t wou'ld say yes, they're
used and useful, and w'ithout boring the Hearing Room
going back through what r just said a few minutes ago
that the difference is they might be used and usefu'I, but
Simplot is paying the facilities charge based on the
original cost, that is different.
a BY MR. WILLIAMS: t hear you loud and
clear there, or. neading, so would you agree with me that
fully depreciated facilities at these locations are not
only used and useful, but they may have va'lue?
A oh, sure, they have value, and r might add
if the piece of equipment exceeds that levelization
3L-year whatever time period parallel to the way we 'look
at rates, the ratepayer, in this particular case Simplot,
has paid for that equipment.
a So what you're asking, though, real1y,
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OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Page 60
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va'l ue, you' re not aski ng
READING (X)
ICIP
1 that we simply just give those away, are you?
2 e r would say that your statement, give 'it
3 away, if the customer has paid for it, then in my mind
4 it's not giving it away.
5 Q You don't expect the company, the company
6 being rdaho power, to maintain and operate facilities for
7 free, do you?
8ANo.
9 a okay. rsn't it true, Dr. Reading, that
10 what you're proposing as part of your testimony is that
11 the company, again rdaho Power, calculate the month'ly
LZ faci'lities charge using the depreciated value of the
13 initial investment in distribution facilities at each
L4 customer premises that's subject to the facilit'ies
15 charge?
16 A that wou'ld to me be a fairer approach than
17 the one being current'ly used.
18 A okay; so would that mean each facilities
19 charge location wou'ld have a different rate?
20 A tt wouldn't necessarily -- define "rate."
2L tt wou1dn't necessarily have a different 1.4 percent or
22 1.7 percent or 1. whatever. what would be different is
23 rather than the tota'l accumu'lated original va'lue of that
24 equipment, no matter when it was put in and when it
25 wasn't put in, that base would change and so you would be
CSB REPORTING 429 READING (X)[phone] rcrP
120511afn. txtisn't it, that faci'lities that
used and useful and which have
CSB REPORTING 428(208) 890-s198
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Page 24L Page 6l
L20511afn. txt
1 app'lying the 1. whatever percent or we'11 argue whatever
2 percent, r don't want to give away it's over L percent,
3 that it wou'ld be charged to a -- each customer would have
4 a different base.
5 Q okay, but that different base would be
6 based upon the depreciated value of the equipment as to
7 when it was insta'lled?
8 A Correct.
9 a or. Reading, isn't what you're really just
10 talking about is vintage ratemaking, vintage pricing?
11 A You've got to tell me more.
L2 q You're say'ing that each customer shou'ld
13 simply have a different rate based upon when the
L4 equipment was put into serv'ice and when it was
15 depreciated?
16 MR. RTcHARDSON: ptadam chair, he didn't
L7 say each customer should have a different rate. He
18 spec'ifica'l1y differentiated what he was talking about
19 there.
20 coMMrssroNER sMrrH: r think, Mr.
2L Richardson, this question attempts to get at what
22 Dr. Reading 'is proposing, so r'm going to allow it.
23 THE wrrNESS: rn my mind, and t have to
24 always do this, r'm not a lawyer, you know, if r tried to
25 make a legal decision, you'd be al1 over my case
READING (X)
ICIP
CSB REPORTING(208) 890-s198
430
1 immediately, in my mind, no, it wou'ldn't be v'intage,
2 because if you look at the individual components of how
J. R. sIMpLor coMpANy,s MorroN ro rAKE eage 242
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Pagc62
120511afn. txt
3 the company calculates the facilities charge, included in
4 those components are rate of return, depreciation,
5 insurance, maintenance, and in my mind, it's the
6 equiva'lent to the customer buying that equipment over
7 time and, therefore, it wouldn't be vintage ratemaking.
8 rhat fits with the concept r'm trying to explain here is
9 that the fatal flaw in my mind, a fatal flaw, is that
10 that origina'l investment amount never changes.
11 a By MR. wrLLrAMs: Dr. Reading, are you
LZ aware of any other utility customers that have the option
13 to purchase faci'lities over time as part of their regular
L4 ratemaking process?
15 A No, r'm not, but it wouldn't surprise me
16 if t was diligent r couldn't find some.
L7 MR. wrLLrAMs: Ho further questions,
l-8 t',tadam chai r.
19 coMMrssroNER sMrrH: Do we have questions
20 from the Commission?
2L COI4MISSIONER REDFORD: r just have a
22 couple of questions.
23
24
25
43LCSB REPORTING(208) 890-s198
EXAMINATION
BY COMMTSSIONER REDFORD:
READING (x)
ICIP
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4 a rn 1958 simplot orders a
5 equipment --
J.R.sIMpLorcoMpANy,sMorroNTorAKE Page 243
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
piece of
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A YES.
a -- that's covered under a tariff.
A You mean rdaho power installs on simplot's
property a piece of equipment that goes into the
facilities charge; is that the question? that makes up
the base --
a r guess maybe that's one of my problems is
there are two documents, one that is already in the rdaho
power tariff that says for special contracts., you will
pay in addition to the cost of, the yearly cost of,
whatever it is or however you purchase it that you're
go'ing to pay a faci'lities charge.
A You said special contract. My
understanding and quick reading of the specia'l contract,
there is a c'lause in there that says facilities charges
wou'ld app'ly for that special contract.
a okay; so at a later date there's a
special contract that's a contract like you and t would
know where there's signatories on both sides and then the
contract terms takes care of that and includes the
432CSB REPORTING(208) 890-s1e8
1 tariff.
2 A okay.
3 Q okay?
4 A veah.
5 a You've had two sophist'icated parties
6 are certainly capable of reading the tariff and
7 understanding what facilities charges are, and then
I have. the special contract and if you add those two
9 together, you have one complete transaction; right?
J. R. srMp,,or coMpANy,s MorroN ro rAKE Page 244
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READING (X)
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who
you
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120511afn . txt
10 A okay.
11 a So what's the rub here about enforcing
L2 contracts other than for just and reasonable and so on,
13 what's the rub here about enforcing contracts regardless
L4 of how long they have been 'in existence that provide for
15 facilities charges and for a specia'l contract? what's
L6 the deal here?
L7 A If r understand your question, you're
18 saying simplot signed the contract, therefore, they
19 shou'ld 'live with it; is that the essence? You're the
20 'lawyer. would that be a non-'lawyer --
2L a No, that's pretty basic law.
22 A okay.
23 a r mean, at what point in time do you come
24 back and say we1l, wait a minute, we've gotten 32 years
25 here and we made a bad dea'l and now we want to transfer
CSB REPORTING 433 READING (X)[phone] rcrP
1 this bad deal into some sort of a give-away or a sale of
2 this equ'ipment for a nomina'l amount. r'm rea11y
3 strugg'ling with this.
4 A r wou'ld say that due to the fact that the
5 charges, be they facilities charges or the approval of
6 the special contract, whenever there is a rate case,
7 special contract customers, just like individual customer
8 classes, are subject to that rate case, what is presented
9 by each party and also what the commission decides is
10 fair and reasonab'le, so what you have that is different
11 from virtually a11 the private party contracts that I
LZ know, you have the commission changing the costs and the
13 terms within that contract every time there is a rate
J.R.SIMPLOTCoMPANY'SMOTIONTOTAKE Page 245 Page65
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Erhibit 8-A
120511afn . txt
L4 case.
15 a we'l'I, when is a contract a contract,
16 then?
Ll A we'll, commissioner, without being smart,
18 you're the lawyer. Let's see, t look at what t read on
19 the sports page and a lot of those contracts don't seem
20 like contracts to me. t would say a special contract in
2L my mind, my non-'larvyer mind here, that a special contract
22 with a regulated utility is a different thing than the
23 contract --
24 A lt's a moving target?
25 A Yeah, and it moves and everybody
434CSB REFORTING(208) 890-s198
READING (Com)
ICIP
1 understands it moves and as you move forv'lard and you see
2 different aspects in costs and return, et cetera, every
3 party within a class or the spec'ial contract customer can
4 come into the commission and say hey, whoa, that's not
5 fair, and then the commissioners say we'Il, that's fair or
6 thatrs not fair. You do thumbs up, thumbs down, cut the
7 baby in half, whatever you do.
8 a well, it just seems to me that you're in a
9 situation that no one can rely upon a contract,
10 especially if the contract has an expiration date.
11 A rguessrdidn'tunderstand.
t2 a nll right, let's assume we want to put in
L3 a generator at simplot and the price is $500,000 or
L4 whatever and we've agreed to pay for that over a period
15 of time, and in addition to that, there's a faci'lities
16 charge and the contract lasts for five years. rs it up
L7 to rdaho Power or simplot to say oh, no, no, no, 'it
J.R.sIMpLorcoMpANy,sMorIoNTorAKE eage 246 page66
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
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12051lafn. txt
18 wasn't for five years, it's for 25 years or 35 or
19 whatever? Don't you have difficulty, r mean, with
20 that?
27 A okay, and 'if this isn't responsive, get on
22 my case again.
23 q rwi'll.
24 A ror the case -- you wouldn't be shy about
25 it, r'm sure. rhe individua'l generator, whatever, for
csB REPORTTNG 435 READTNG (Com)(208) 890-5L98 rcrP
1 500,000 that rdaho Power would insta'I1 on simplot's
2 property, there is no contract for that. Given the way
3 the faci'lities charge has been administrated, it would
4 s'imp1y -- rdaho Power would insta'll it. They would take
5 whatever the cumu'lative original cost investment of all
6 those faci'l'ities charges had been up to that point and
7 they would add 500,000, so now the 1.7 percent would be
8 applied to an amount that wou'ld be $500,000 higher.
9 Q well, that in my mind is quite a fiction,
10 if, you don't mind me saying, but r've always be'lieved
L1 that there should be on all contracts a beginning and an
LZ end and at the end, you stop.
13 A r concur with that ana]ysis and that goes
14 back to the thing that bothers me probably the most about
15 the way fac'ilities charges are being applied is that it's
L6 never ending. rt's when that original piece of equipment
L7 got put in at the origina'l cost. rt only ever changes'if
18 that origina'l piece of equipment stops working, then
19 rdaho Power would subtract that original cost and add
20 back in the orig'ina'l cost of the newer equipment, which
2L over time is, of course, always h'igher.
J. R. SIMPLOT CoMPANY'S MOTION TO TAKE eage 247 Prge 67
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
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120511afn. txt
22 a and that's according to rdaho Power or
23 according to simp'lot or to this commission or who's it
24 according to?
25 A Rccording to rdaho power, the way they
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1 administer and ca'lculate and charge the customer for the
2 facilities charge and that's why r'm here, the. lawyers
3 are here, severa'l plant managers are here. rhey say that
4 is not fair and reasonable.
5 Q over a period of time it's not?
6 n Yes.
7 Q rf you go dovn and lease a car, you 'lease
8 the car fortfive years --
9 n correct.
10 a -- you pay a certain amount up front.
11 A Correct.
LZ a end if you pay your yearly amount and if
13 the engine blows up, they replace it.
14 A Correct.
15 A uo charge for replacing it.
16 A rf it's within that leased period,
L7 correct.
L8 a what's the difference between that and
19 this?
20 A rhat if you leased the car and the 'lease
2L payments were calculated on x percent of what the car
22 leasing agency assumed their costs were and that
23 particular car cost $25,000, then the lease -- the
24 ana'logous the way facilities charges work, the analogous,
25 you wou'ld drive that car and you would be charged 1.7
J.R.sIMpLorcoMpANy'sMorroNTorAKE rage 248 page6E
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
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12051lafn. txt
CSB REPORTING(208) 890-s198
437 READTNG (com)
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L percent of the $25,000 for as long as it worked. rf it
2 blew up, if it died, if it did whatever, then the leasing
3 agency would give you a new car. rf that new car now had
4 a $35,000 charge, you would pay the 1.7 percent on the
5 35,000. If not, you would pay that forever; othenrvise,
6 you would be buying a lifetime auto lease with a
7 percentage charge based on the original cost of the
I car.
9 Q sure, and that's in the terms and
10 conditions, isn't it?
11 A veah.
LZ a Have you read one of the special contracts
13 of rdaho Power?
L4 A sriefly, yeah.
15 a ooes it clearly state that in its special
16 contract?
tl A No. what it says in addition, you know,
18 it says here's the special contract, the rates are based
19 on whatever. r'm not sure they even say in the contract
20 theyrl] change on every rate case. the part on
2L facilities charge, it says something as briefly as also
22 subject to facijities charges as 'listed in tariff X, Y,
23 z, whatever the app'licab'le tariff is.
24 a Putting aside contract 'law for a minute,
25 what you're suggesting to us is the possibifity that
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1 regardless of what's stated in the tariff and what's
2 stated in the contract, we're here to say that's just not
3 right, it's too much and we're trying to come up with
4 some sort of a different type of situation that
5 recognizes the equity of everything we're dealing with?
6 A ebso'l ute'ly, yes , si r.
7 e okay, one other question and then t''l'l
8 stop. the pooling, r understand that when I put in a new
9 generator at simplot, instead of tracking that generator,
10 'it goes i nto a pool .
11 A rt's added into the tota] amount of
LZ facilities, original cost of equ'ipment for the facilities
13 for that plant. rt's just added on there.
74 a okay; so that seems to further complicate
15 the situation, because r cou'ld have a piece of equipment
16 that went bad or t wanted to get rid of or I wanted to
L7 buy a new one and al'l of a sudden, instead of buying the
18 new piece of equipment and allowing it to be depreciated
19 over its 1ife, r'm now picking up a portion of the
20 charges for everything that's included in the poo1.
21 A Yes.
22 a Now is that fair?
23 A t don't think it is.
24 coMMrsSroNER REDFoRD: okay, thanks. No
25 further questions.
CSB REPORTING 439 READING (COM)[phone] rcrP
1 EXAMINATION
2
3 AY COVIMISSIONER SMITH:
J.R.srMp,-orcoMpANy'sMorroNTorAKE Page 250 Page 70
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
a "n llTltigd#rt, , can't r et thi s
5 opportunity go by.
6 A thank you, commissioner Smith.
7 Q so you've done regulation a long time --
I A Yes.
9 Q -- on different sides. rs this the real
L0 wor'ld?
11 A when t was on the staff, the commissioners
72 always asked me the hardest questions. Things haven't
13 changed. Regulation isn't the real world. Reguiation
L4 is --
15 a You don't need to characterize it, but
16 just acknowledging that it's not the real world is
L7 sufficient.
1-8 A No.
,' '\ 19 a You know, this isn't a rea11y new issue.
20 rt's the same issue as when the widow calls and says r've
2L been in my house 50 years, why do t have to pay a
22 customer charge, my meter is fu11y depreciated, and we
23 all know the answer to that.
24 A Yes.
25 a md why should it be different here?
CSB REPORTING 440 READING (COM)[phone] rcrP
L A es r explained a 'l'ittle while ago, the
2 faci'lities charges are based on that --
3 e r understand the equity argument and the
4 origina'l cost.
5 e okay.
6 Q rsn't that the same thing we're doing to
7 everybody else?
J.R.SIMPLoTCoMPANY'SM0TroNToTAKE eage 251 prgeTl
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
8
I
10
11
L2
13
t4
15
1_6
L7
18
19
20
2L
22
23
24
2s
1205I1afn. txtA My gut te'lIs me no.
a But your brain can't find an example?
A vou need to give me time.
a t'11 give you time while t ask my next
question --
A okay.
a -- which is, you know, r can't th'ink of
any other circumstance where we've told a customer yeah,
you're right. You've paid this rate for 50 years. Your
equipment is totally deprec'iated, so it's yours. That
doesn't happen, does it?
A Right, r wou'ld agree with that and whether
you will accept or not, my brain is working --
A cood.
A -- or at least r think it's working. The
difference is, is if you were a retai'l customer, your
rates are made on the average rate base of a'll the other
customers, a'11 right, so your meter, a new meter and an
CSB REPORTING 44L READING (COM)[phone] rcrP
old meter and we do the averaging and r understand that.
rn a ratemaking process, there is not this anomaly where
you're charging the reta'il customer, if r would say hey,
r want something, something for whatever and r will pay
an extra percentage of that over time; otherwise, the
difference is, is that the faci'lities charge that
customers pay are back around in a rate case and credited
back to that consumer class; otheruise, that's a specific
spec'ial kind of a charge that is ca'lculated based on that
specific customer's desires, wants, et cetera.
when r'm a residentia] customer, r can
\
1
2
3
4
5
6
7
I
I
10
LL
J. R. srMp,.or coMpANy,s MorroN ro rAKE lage 252
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Page72
120511afn. txt12 understand why r'm in a pool and r pay'l'ike everybody
13 else. rhe difference is r've got, you know, a mi'l'l'ion
L4 dollars worth of rdaho Power's investment next to my
15 swingset, out in my pasture that my horses have to wa'lk
16 around, that the company is charging me x percent for
17 that mil'lion do'llars worth of equ'ipment, and so then
18 rdaho Power would take that amount, rol] it back under in
19 this case and credit it back to the residential c1ass,
20 and to me there is a definite difference and
2L distinction.
22 a sut would it surprise you to know that the
23 very first time that facilities charges, r think, came to
24 my attention, it actually was a residentia'l customer over
25 east of pocatel'lo who had a facilities charge on the'ir
CSB REPORTING 442 READING (COM)
(208) 890-s198 rcrP
',.) +
1
2
3
4
5
6
7
8
I
L0
11
L2
13
t4
15
'li ne extensi on?
A okay.
a And so r mean, 'it was the same deal .
A How was that handled, may r ask?
a I th'ink we to'ld the poor woman that that
was what the tariff said, but we'll have to research
that, but anyway, a utility's customers, they're not out
buying equipment, are they, they're buying service;
ri ght?
A wow, from the electric company, theyrre
buying power and depending on who you are, if you're
llicron, you buy service, but you pay for the whole
substat'ion to get that service.
a end who owns the substation after you've
paid for it?
J.R.sIMpLorcoMpANy'sMorroNTorAKE eage 253
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Page 73
120511afn. txt16 A well, in that particu'lar case Micron
t7 does.
18 a okay, how about uoku?
19 A r'm not familiar enough with them, but if
20 they paid a whole bunch of money to put in a lot of
2L infrastructure to receive service from rdaho Power for
22 their plant, then they would orvn it.
23 q would you be surprised to learn that rdaho
24 Power owns the substation?
25 A r have too much gray hair to have things
csB REPORTTNG 443 READTNG (Com)[phone] rcrP
1 'like that surprise me.
2 a neither here nor there, and r do
3 appreciate and I do understand the percentage 'is not the
4 issue, it's the orig'inal cost is the basis against which
5 the percentage i s appi'ied.
A Yes, accumulating over time forever.
a r've got it.
A rhank you, commissioner.
CO,IMISSIONER SMITH: ThANK YOU. DO YOU
10 have redirect,, Mr. Richardson?
Ll MR. RICHARDSON: lust a coup'le,
t2 uadam cha'irman, with your indu'lgence. t neglected to ask
13 Dr. Reading what I consider a housekeeping question.
L4 rt's not in his direct testimony, but if r cou'ld ask him.
15
16 REDIRECT EXMINATION
L7
1.8 BY MR. RICHARDSON:
a Dr. Reading, you were present during the
i)
6
7
I
9
19
J. R. srMp.,or coMpANy,s MorroN ToTAKE eage 254
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
Page74
i)
12051lafn. txt20 settlement negot'iations of the general rate case?
2L A YES.
22 a md when the issue of facilities charges
23 was being carved out, was it your understanding that the
24 Schedule 19 facilities charge customers had agreed to
25 accept any increase in costs that are caused by
CSB REPORTING 444 READING (COM)[phone] rcrP
1 non-schedule 19 customers?
2 MR. wrLLrAMs: uadam chair, r'tn going to
3 object. This is way beyond anything in or. Reading's
4 testimony and it's actually plow'ing new ground on a new
5 i ssue.
6 Coi4MISSIONER SMrTH: Mr. Williams, I'l'l
7 certainly give you your opportunity to ask any cross-exam
8 on it, but r think or. neading's understanding of the
9 settlement is relevant.
10 THE WITNESS: rf r heard your question
11 correctly, the clause in the sett'lement applied only to
t2 schedule 19 customers and changes in whatever impact
13 there would be for schedule 19 customers on1y.
74 A By MR. RTcHARDSoN: tnd you were being
15 questioned by commissioner nedford and you were asked if
16 a contract is a contract is a contract k'ind of thing, the
L7 contracts on these spec'ial facilities charges reference a
L8 tariff, do they not?
19 A Correct.
20 a end is it your understanding w'ith all your
2L considerable gray hair in the utility industry that
22 people signing contracts that reference a rate in a
23 tariff a'lways exirect that tariff to be changed down the
J.R.sIMPLorcoMpANy'sMorroNTorAKE Page 255 page7s
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
road in rate
A
1.2051Lafn. txt
cases?
CSB REBORTING(208) 890-s198
periodically, yes.
445
1 Q so although a contract is a contract, it's
2 not real]y a rate freeze, if you wi11, forever?
3 A rt is not a fixed rate, yes.
4 a lnd commissioner smith asked you about the
5 poor widow complaining about the charge for her meter or
6 whatever, isn't the significant difference here is that
7 the widow is in a rate pool of residential customers that
8 enjoys a depreciating rate base that if there was never
9 any addit'ions to it, it would eventually go to zero, and
10 here we have a poo1, the facilities charge customers,
1l- that do not enjoy a depreciating rate base?
L2 A rf you have a situation where there is
13 essentially negligible rate base added every year, one
L4 would expect that their rates would go down over time as
15 the rate base goes down over time and is not added to
16 given whatever happens to expenses.
17 COMMISSIONER SMITH: ANd iS thAt EVEN A
18 reasonable hypothesis?
1.9 THE WITNESS: I KiNd Of .-
20 coMMrssroNER sMrrH: Never mind. That's
2l rhetorical.
22 MR. RTCHARDSoN: r thought it was.
23 coMMrssroNER sMrrH: well, obviously,
24 but --
25 THE WITNESS: r think r could probably
csB REPORTTNG 446 READTNG (Com)
[phone] rcrP
J.R.srMpLorcoMpANy'sMorIoNTorAKE eage 256 Page76
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
24
25
READING (com)
ICIP
1
2
3
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5
6
7
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I
10
11
L2
13
L4
15
16
t7
18
19
20
2L
22
23
24
25
120511afn. txt
find one somewhere, some co-op or something.
COMTSSIONER SMITH: Get rea].
MR. RTCHARDSON: That's all I have,
ptadam chai r.
COIVIVIISSIONER REDFORD: COUId I ASK?
COMMTSSIONER SMITI{: Commissioner Redford.
EXAMINATION
BY COVIMISSIONER REDFORD :
a or. Reading, notwithstandJng everything
else that we're dea'ling with in this case, the
stipulation, which is quite frank'ly a remarkab'le document
to an extent, it appears that we've spent a great deal of
our t'ime trying to talk about a d'ispute between rdaho
Power and simplot.
A Yeah, r'd say that would be fair and other
customers that simplot has made aware of what is actual'ly
going on in the facilities charge, but essentially,
yes.
a Would you suggest that the most
appropriate way to resolve this would be to bifurcate
this issue, give rdaho Power and the other similarly
situated customers and rdaho Power a further opportunity
to negotiate this to come out with a just solution and if
READING (Oi)
ICIP
CSB REPORTING(208) 890-s198
1 that doesn't work to bring it back to us?
2 commissioners laughing at me.
J. R. stMpt.or coMpANy's MorroN To rAKE vage 257
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
447
r see my other
3
4
5
6
7
I
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10
11_
L2
1_3
L4
1_5
16
17
18
19
20
2L
22
23
24
25
12051lafn. txt
CoMMISSIONER SMITH: l,ty first comment is
that I think that wou'ld be a consu'ltant's dream.
a By coMMrssroNER REDFoRD: r realize that.
r want to be a consultant in that case, but r'm just
saying that as you know, there are very few issues or
disputes that aren't so tota'l1y unreasonable at least in
my history or lifetime, if the stakes are h'igh enough,
they haven't been able to come up with some, if not a
fu'll-time, decision, at ieast some sort of a decision
that hand'les the issues.
A r wou'ld answer that in two ways and,
commissioner sm'ith, r'll answer this straightforward if
you won't call gen in Tallahassee, okay, that one reason
that the tndustrial customers of rdaho Power wouldn't
sign the stipu'lation unless this particular issue was
carved out was that the negotiations with rdaho Power
over this issue have been going on for more than two
years and that the zigs and zags that have occurred, such
as yeah, we'l'l sell it, no, we won't sel'l it, okay, we're
going to file a tariff and sell it, that we've pushed to
bring it in a rate case setting to try to get it
resolved, and t personal'ly would be fearful that lf it
was punted to a separate docket that it wou'ld go on and
CSB REPORTING 448 READING (Oi1(208) 890-5198 rcrP
1 on forever and it may be good for consulting, but the
2 rndustria'l customers of ldaho Power and simp'lot have
3 spent a significant amount of effort and expense in
4 trying to solve this issue and it has gone around and
5 around, so the Commission can do what the commission will
6 do. t understand that this is a comp'licated issue and
J.R.srMpLorcoMpANy'sMorroNTorAKE eage 258 page78
OFFICTAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
', ,)
12051lafn . txt
7 you want to look at it some more, but t would not
8 recommend that.
9 Q civen the reasonab'leness of everyone in
1-0 this room, don't you think that others might say we11,
11 that's a fair resolution and we'i1 go ahead and sign the
L2 stipulation and carve this out and have a time set and if
13 it's not resolved, then we've got most of the testimony
L4 in?
15 A r would have --
16 a Give it six months, then the commission
L7 will answer it.
18 A veah. r would have to ask the other
19 parties. r don't know where they would be.
20 a we11, t don't think that's your charge,
2L but it certain'ly might be our charge of at least asking
22 the question, but, you know, if we don't resolve this,
23 then the st'ipu'lation is not going to get signed anyway;
24 correct?
25 A lt could get signed. sometimes the
CSB REPORTING 449 READING (Di)[phone] rcrP
1 commission approves a stipulation without al1 parties
2 sign'ing the stipulation.
3 a wel1, r think of the stature and the
4 position of the parties in this case, espec'ial'ly the true
5 parties. we could have a stipu'lation signed without some
6 of the other signing. r see that Marsha is writing notes
7 to me, so that must mean something, shut up, Redford, and
I that's it, so at any rate, that's not an issue for me
9 certainly to decide right now, but r after a]l these
10 years have found that there aren't very manyJ.R.SIMPLOTCoMPANY'SMOTIoNTOTAKE eage 259 Page79
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE -
Exhibit 8-A
120511afn.txt ..
11 disagreements that aren't negotiable and maybe you don't
L2 feel that way, but that's the way 'it is.
13 A some aren't and thatrs why you three
L4 exist.
15 COMMISSIoNER REDFORD: Okay. rhank
L6 you.
L7 COMMTSSTONER SMrrH: rt',s good to knor we
18 have a reason for being.
19 THE WTTNESS: YES.
20 COTUIMISSIONER SMITH: Dr. neading -- did
2L you have any more redi rect?
zz MR. RTCHARDSoN: No, Madam chair.
23 COIT,IMISSIONER SMITH: okay, f just want to
24 thank you for your good-natured endurance of the
25 comnission's questions and ruminations. :
csB REPORTTNG 450 READTNG (oi) ) ;[phone] rcrP i
1 THE WITNESS: rhank you.
2 COMMISSToNER SMITH: thank you.
3 (rhe witness left the stand.)
4 co[4MrssroNER surrH: we're going to take a
5 five-minute stretch break before we go to the next
6 witness.
7 MR. Rrct{ARDsoN: May Dr. Reading be
8 excused?
9 COMMISSIONER SMITH: Tf there is no
10 object'ion, we wi'll excuse or. neading.
11 (Recess.)
L2 coMMrssroNER sMrrH: All right, r believe
13 we are ready for Mr. Richardson's next witness.
L4 MR. RICHARDSoN: thank you,
J.R.sIMpLorcoMpANy,sMorroNTorAKE rage 260 page8O
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE
Exhibit 8-A
EXHIBIT #8-B
J. R. SIMPLOT COMPANY'S MOTION TO
TAKE OFFICIAL NOTICE AND/OR OFFER
INTO EVIDENCE 4'-3#D
BEFORETHE
IDAEO PT]BLIC UIITrIIES COMIIfiSSION
CASIE NO.IPC.E.II.IIE
INDUSTRIAL CUSTOMERS OF IDAEO POWER
REA,DIT{G, Dtr
TESTIMONT
EXHBIT NO.3OI
Dn Ilon Reading's Curiculum Vitre
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Pn tor tltotltior
. Edrcatloi
Hotctt asd
dJ etdt
Profo,rtio eal
aed brtiacts
blttoV
Expcrlttct
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Dor t.lqltq
Don C. Rsadlng
Vlcc Prcrtdcot rod Coarulting Ecoaoniot
8.S., Eooaomlct - Uteh Surc Univcrdty
M.S., Bcoooalcs - Uoiverity of Orcgoa
Ooicios Dehr BpdtoqNSP Fallowrhip
Bcr Johoron Aisocirtcr, Iac.:
1989 - Vicc Prridcnt
19A6 .- Conrutting Ecooomirt
I&ho Publb UtlEics Cosralsrion:
19tt-86 Ecooodrc/Dilctor of Polcy end Adrnhbmtion
Tcrchiag:
1980-tl Aroche kofcrrcr, lloiwnity of l{rsrii-Hilo \
197)-80 Asochtc rad Arsimru Poftrcor, Idrho St*e Uaivcrrity )196&70 Asriloat Profruor, MEdlc Tcaac*ec Stre Uofucrdty
Da tmdiqg proridce crpcrt tctdmooy ooaccmiDg Gconomic urd regulr,ory ieouc8.
FIc hu eriifitd on anrq thrn 35 occrrionlbcbrt utility rqfrlqtory commircbns in
Alrrkq Cdifordr, Coloredo, rtc Dirdct of C,oluabir, Hr;rii. I&ho, Ncve&!
Notth Drkoe,Tcxes, Utdu \Plorning, rad \9r$iogton.
Dr. Bcrdinghrr srosc d'.g30 yc.rr crpcdcncc'in drc field of ccooomicr. Hc hrr
partctpcd ia rlte dcvclopmcnt of ldkc! rcflcctingcconorlc trcodg GNP growttr
irEa. forctn crchengc rnr*cts,thc uoacy rupplr'.toct Eaikct bvclc,rad
io0rdon Hc hrr rorlyrcd ruch public policy ircucc rs thc ninimqm rqgc, ftdcrd
spcoding rad trxatioo, ud ioport/cxpottbdenccr. Dr. Rcedidg is oac offout
ccooooiete providhg ycrdy forcc9*a of st tcwtc pcroood iacomc to dlc Starc of
Ideho for purpolcs of estrblirhiogune pctronrl lacomc trx nte!.
Ia tic fLld of telacomounicclxr, Dr. Rcding hrs providcd cxpcn tectioooy on :
thc lsgucr of mngindcorg picc chotlit6rnd mcesurcd crvicc.Dr. Rcrdlng
ptcpercd rstrt-tpccific rtrdy of thc prbc dr*icty of ilcmend fot bcd tCcphonc
scrche io ldehoend rccco$ coaductcd acrrtch for,end dircced the ptep,trtba .
of. a rcpm to thc [deho lcgfrlnurc tcgrtdiog drc otrur of tebcommuaicetbna
.orgr.idoo hthct rtce.
ErhtbltNo- !10!
IPC.E.II4B
Rcadlng ICIP
Prgc I
Pa,ge 2
i
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Dr. Bcediogfr rErt of erpcfibcls thc lidd of ebctricpowcr inchde dcrnrnd
Gorccrrdag loq.rlgc phonlng pdoc cl$tcity, urrgiadrnd rvcr+ colt Ficia&
producba-rlnultloo noddng, nd ccoaoocuicnodcling.Anong hla rccnt
G.tcs vrt ro cbctd€iltr dcrigr rrrdyrb for thcloductdd Cucolncrs of Iddo
Poscr. Dr. f,cedi4 ir cuncad, r conruloat o thc Idrbo LqicleturCc Comraittce
on Blcctric Restructldn&
Sincc 1999 Dl Ecrding her bccn rffilirted vith tc Climrc Impoct Gtoup (CIG) at
thc Univcnityof !?rrhingon. Hir woi vith thc CIG hrs inrolvcd rt rndyrb of
6c inprst of Globd \[roiag on thc hydo Bcilitics on thc Sode Xtuct It rlro
includcr rn lacedgcion ioto vrer rrrtar ln 6e Notthrrct rnd Floddr, In
edditbn hc hrr eidyacd thc cconomicE'ofrnosaukins fur eliror'alnprcted by
GbbdV.roiog.
/.\mong Di. &cadlqlr rcccat proieu oc r FBRC hy&oporra rclccnshg atudy Su
thc Sbttootsh lrdilc Tribc) end ro rnrlyris of N othcrn Sutcr Pogcds N otth
D*ota rcg dcr$ proposdr e6cting.Ltgc hdutril eu. *oactr (forJ.R. $ioplot
Cobpeoy). Dr. R..dl4g bu ibo pcrfornod rorlptr fc 6c lddro Govcraods
Offioc o f tho impe ct on dri N orthverc Poste (hid of vrriour p&ne to iocrcas!
sdnoo rnu in &c CotrobirRiver Begh.
Dr. 'Rcadiog hrt plcFcd ccbnomccb brcci*e for trc Southcec fdrho Couacl of
Govcmocatr rnd thc S,csinuc hoicclion Commiuec of thc ldrho Stre tqideuuc.
Hc hc! alto bccn r nombcr of atvcrrl NortLrrrt Porrcr Phnoing Couodl Sad*icd
Advisory C.oumiaccc eod ver vie chdrnro of 6e Govcroodt Econouic Rcrcerch
Courcilh ldrho
Vbilc rt ldelro Strte Uoivcrsity, Dr. &cading pcrfomcd dcmognphic onldice uring r
colon/cutvivd oodcl rad scvcnlccoaornic iotrrct rtudlt.urtag hput/ouput.o*tdr Hc hr rln povidcd apci tciiooay lodercr ooccrninglorsof iacoac
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bnr4a.$ r rdiui'eprofcnor of econoartq rtBolc St t Uaivcritt G&ho
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cucrcat[ i raeuber of thc Eolc Oty hbltc \[ot]rComukdoa;
ErhibitNo'30l
rPc-E.I1{8
ReadlngICIP
PaSe 2
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Pnge 3
DoaC.lcriil
Plrlkcctott 'Bacrgirhg ldrho", Idrho llrueOnlioc, Bolsc Sbtc Ualvcrsty, FdI2006.
virw.b olicrtrte.crhr/ hlrory/lrucioaliac/&lllB06ircucr/iod arJrtto I
Thc Bcononrlc hprct of fic 2@1 Sdaon Scseon to ld&o, Idabo Fth .nd
Wildlifc Foundrdron, April 2003:
fhc Econonic r-Frct of r Rcrtorsd Sdaoo .Firhcry ia lddro, Idsho Fbh rod
Vitillfo Fouodrrion, Apd!, 1 999.
Thc, Eono.lc lagact o f &clhced Filh&rg nrd &c R ctum of.Salmon FtaLiog in
Idrho, tdrho Fidr rndVlldlifc Foundrioo, Sqrtcobu, 1997.
rCort $rvlngr fuo Nucleer Rcsourccs Rcfonn: An'Bsonooctric ModeP (wlh E.
Bry Croartrcry rnd BcoJoho:on) Sortm Enoaiclornrl, $priag 1996.
AVisitorAdygir for o Birdc of Prcy Publlc Attrrcloo, Pctcgrloc Fuod, Inc.,
Novcmbor, 19E8.
Invcerigitioa of r Apiuliadoo Retc fu ldrho lly&oetcctdc Proiccsr Id.$o Sutc
Ter Goomisri,oa, Juac 1988.
: "Po.tPufPAVicvr,rIaPtocccdirgoofdrcNARUC BiennidX,ctshtory
f-onfctcncc, 19E3,
r .r
An loput-Ouqrut Anrlpir of trc Imprct fro Propored Mioiag io thc Chrllfu Arel
(Ei& R Drvier). Publrc Policy Rcrerrch Ccntcr, Idrho Strtc Untvmity, Fcbnruy
19E0.
Pboptdl. erl Strtlrllr A S rt Ercrtndl AadW (wi6J. Eyre, ctel).Gorcrancnt
Rcscrrch hrriua pf ldrho$tetc UotvcrrLyeld thc Sothcrrtldeho Gouodlof
Gottrnracatr, Aoggrt 1 975.
fu&tatgGamtFttlRra n olthstdc oflkto(vitb S. Ghr4rnfirrd D, Hollry)
Cerncr for Eudncer rod Bconooic trcrcorch, Eoirc Stce [Inivetrity, Junc 1975.
'A Notc oo thc Ditrbution ofFcdcrel Expcndlurer: An Int6c.t. Coaprrboo,
I 933"1930 eod I 961-1965," h Tb Anrint E noaht,
Vol. I(V[L No. 2 @rll 19?4), pp. 125-128.
.lNcs Derl Actirity rod thc Stetr, 19311939.".In lonal { BorothHhtlyhVol.
FfXUI, Dcccobct f973, pp.792-E10.
Erhtbit No. 30t I
IPC-E-Ir{S
RcadingICIP
Pege 3
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 4
3"'l
BEI1ORD TEE
IDAEO PUBIJC ITIILITIES COMMISSION
cAsE NO.IPC-r-11-08
INDUSTRIAL CIISTOMERS OF II}AEO POWER
READING, DI
TESIIMONY
EXHIBIT NO.3O2
Idaho Powcrrs Rcrponrcg to Production Requot No. 28 Regarding
Idaho Power's Authorizd Retes of Retnm Since 1987
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDf,NCE.
Exhibit 8-B
,..t
REQIIEST FOR PFODT[rGttOll 1{9. 2& Rsferunoe Dircd Teefinony sf Soott
Sparlce, p. 41, tines l-3 (statlng that tre pitnary osl corponcnt that liae ddvsr the
rcducilon tr he fadlltitrs cirqe nts h ha Rate of Ratrm, wtrictr hae decreassd slnce
the la* update).
(a) Pleare dmlt or dery that he Rab of Rfrrm ueed ln fire 1987 calcrdatlon
fu Sdrcdule 19 vuar 9.952%. lf deny, phage ldsnW tho Rab of RstJm ueed ln 1987.
(b) Plsase ldontlfy tra CommiscloR caBe numbar br all gmml rae cmss
f[ed by ldaho Pows slrps 198?, and the Companfr arhorLed RS of Rstum ln eadl
of ttross cess8.
(o) PteesB admlt or deny that tro mte of Rdlm authodzed ln 2005 (IFBE-
05.24), Ar07 (IFGE{I7-OE), ZOG (IPGE{&1O), was less tran the Rat€ of Retum uoad
b calculfietheftdfficcharge Elnce 1907. lf dony, pleateexdaln.
(d) Pleage elQhin why the Company hae not updatcd the hdlilles cfiarge
slnoe 1087 in llgtlrt of 0te dacma* h Rete d Rdrn oocurlng at 0te tlme of general
rate calo fllrUe lleted [r (c). Hs fire Compeny been orrerchalglng for the facl[tles
etrarge byfiallngto updateho dratgo pdorb nou/?
RE$FONSE TO REQUEET FOR PRODITCTIOT{ NO. A:
(a) The rate of rstum wed ln the 1087 calcuhtion 6r Sdretuh 19 uas 9.902
pereil, rrrfikh coraporrG b a tevplized nab of rstm of 6.0G3 petwrrt ln
cunparlson, tte 20lO rated r€tum ussd h the prupooed fadmbc chargs calculallon le
6.Otg porcent, wttldi onsaponde to a lcvdtsett tete of letum of 4.8,1p€tEert as shown
on psge 40 of the Dlrrct Teetimony of Mr. Spails.
DAHO FO,YER COMPATTIYS RESFOITISE TO TtIE SECot{D REOUESTS
FOR PRODTJCTION OF THE INDT'ETRIAI CUStrOMERS OF IDA}IO FOYI'ER. 3T Erhlblt No,302
IPC-E-Il{t
Rcarllng ICIP
Prge I
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 6
,-'s
(b) The Commiaclqr oaeo numbers for all genellal rde carc flhd by Haho
Foueralnce 19E7 and the Gompanfs auttprized ratc of rstlm in cach of tho$ casoB
alg shown ln thetatrh below.
Orncnl Rfr
GanYorrFfhd Gg llmfirr Rrbof
Rettm
rPoE44t 9.190%
2 tPcE{x}-l3 7.E5im
2m5 tPGE{tti]FGEEil E1%2W 8.1%
2Ur8 IPGE{!8-10 8.18%
(c) Plmssaettr@npnfercqpmeeb(aland (b)above.
(d) The Gompany lns not uFatarl the.fadllfies c{rarges sftloe 19SI beoause
its perhdlc vdldaflond of the ffiirU fedllteo chaqeo did not mnant an updab rrtpn
uelng the cuner{ ryprorred calculaton mgtro<lology.
The response b trle Roque$ w* prcparud by Smtt D. Sparla, Senlor
t. )
Rsgulabry Analy$, ldaho Powor Cornpany, in mnsuttation rlilh Jacon B. Wlliarrs,
Corporirte Couneal, ldaho Porrer Gompny.
IT,A}CI PO,VER GOTu|PANYS RESPOI{SE TO NE SECOND REOUESTS
DusfnN OF TtlE lNDusTRlAt ct STOMERS oF lOAl{O POWER - 3a r"1grl#,
Reeding'ICIP
Page 2
J. R. sIMpLor coMpANy's MorIoN To rAKE Page 7
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
,\
BEX1ORE THE
II}AHO PUBLIC UTILITIES COMIIfiSSION
cAsE NO. IPC-8"11-08
n-rnustruAr cuffolrilERs or rDAEo PoTvER
READING, DI
TESTIMONY
EXEIBIT NO.3O3
Idaho Powertg Responses to Produetion Requcst Nog. 6, 7, 46, and
47 Rcgtrding ldaho Power's FaciliJies Charge sCrcdit'
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Erhibit 8-B
l\
Page 8
REOUBT FOR FRODUFTIOiI tO.!: Relbmnca Dlroct Tesilmony of $ott
Speils, p. al (statng ttrat lhe ct0mahd r€ducton ln rwenue rccelved by the Gompqny
I
though lhe fadlltes char3e .uulll restilt ln increaees ln the ,Bvontrc requlramerilc br
eadi qrgtomer dass hat oolhc0E hcllteg chaqe ravenue)
(a) Pleaee admlt or rlery that tre Companfs f llng urbmlts hst a fr lr, JuBt and
rpasnde Edlltoe drarge br Sdredule 9, 19, and 24 cugbrmrr would bo 1.41%
monlhly, whlfi b a rududlon fiom he dralge currgntly ln efbct ol 1.1% monthly. lf
deny, ptessoeplaln.
(b) Pleara admlt or dsny that the Cornpanye filhg:sr$mltE that the rsduction
ln rawnue cdbon{ tom customer ohrces ffilbrrhDlo b tttc ptoBoscd reducilon in fie
hcl!0s @Ee slputs.orult in a otruspondlng irrcrease h tevsnus nguimment fur
thoso customsdeEEB. lf deny, pfase dphln
(c) lf the responsc to ihe (a) and (b) ls b admlt please erylah the
Companfc lueffiaton. Speolfrcally, please fully explain why'e rcductlon ln Corrparfs
nte of ratrm Cnce 1987 (orarfy other pdrrcilon ln any otlror conTonsnt of thq facllfre
charge) ald a cor€spondlng necd b ttdue tre frcilltes charge shoulrt be oupled
wlth a corrseponrllng hueeso the levenue.lequltorpnt fur tteoe cuglomer chsses.
RE9FOTSE IIO REOIIEST FOR PRODlErtOlI ilO.6:
(a) The Oompany'e flfrg subnrlts tM a monttrly hclllUs charp rate of 1:41
percant ls a falr, iust ard re&nable taclllUes clrarge ftr Sciredule 9, 19, anrl 24
customcrs.
(b) A rpdudion ln revenrs coll€ctod fionr cuebmerchgsc at[ibutarble to thE
gpBosed rsductlon ln the fadllses charges wlll reult ln a mmapondlng lrueasg in
rev€nuo rrquhenont fur tlrose cu$nrer dasses.
IDA}IO FOI'"ER @TiPAiIYS RE8PONSE TO II{E SECOilD REqJESIE
FORPRODUSNCX{ OF ftE NDUSIRAL CI'SIONiER$ tr E'I}IO FOWER. 4 EitlbtNo303
rPC-E-Ir.08
Rtadlngr |CIP
Prgc I
J. R. SIMPLOT COMPANY'S MOT,ION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Prge 9
mtauA b hq Cqnpanfs cost of ownhE, opentq qnd malnhlnlng lbdlites that alg
solely dedlcated b thss€ cudnmers. As a rtsult, lhe nwnue rocdvd liwn these
custorrsrE is apCiad as a d[ad oftd or crodtt to tlre rsrranue rcquhenrenrt fur the
colrapndir6 o.ffimr da$. Bocauso 0E!c fadffior art only uced by crffimsrs
subj€ct b iacllEae ctraqea I is pasonaUe b oftst the.leepoc{rt qrstomer dassae'
rwenue rqulrement Thercftn, a redtdlon ln the rawnre creirit mlatad wtth
fadffies c*rqeps lesrdts ln a onurgondfip lnauase in the rcvenue rsqukqment.
Tte rsspgns b ttls Requed vre plryrcd by SGot D. Sffis, Senlor
Regulatory Anahpt, Haho Potfler Gornpany, ln onullbfion wittr JaaOn B. Wlfiafp,
Coporate Gounsel; ldatrc Ponrer Company,
IT,A}O PCN,YER COMPATTITg RESPOT{sE !O THE SEOS{D RECII.ESTS
FOR PffiDUOI|ON OF IHE INEt SIRIAL CUSTOITIERS OF IDAHO PCI,VER - 5
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
ErhtbltNo.303
IPC-E-Il{t
Readtng ICIP
Page 2
REAUEST FOR PEODUCI|ON ilQ 7: Rsleltne Dimct Tastmony of Smtt
Spa*s, p. 41 (gtating hat the esfrmqted mduoflon h mvenue rsoehred W thE Comparu
thrcrgh the lHll0es drarge 1fllll t€sutt in ircreass ln, the rup-Iru€ ruqdrcmsnB ftr
ceofi qrstorrr c{ae th* collods frcilltl€s cherye rwemrd).
(a) Does the Conpqny botow that lt ls enlUea b nrylraln re!,enrle nerfiil wlilt
t"g1rd b any &Engss ln tre lhdllfim drelge eh,ulat6d ln 1987? thss the Conpany
onsltlarthe lewl of facllltlao drargo setfor Schedde lg flsturrrrB h 1987 in Cas€ No.
U'1q)G298 b be a 'grarffiailhemd' reto to wt{dr it ie enffiled lnb pupltultr? f mt,
pleqsoExphUr
O Pleme Eerflry eny otrcr r# rcoorery rnEclranism auErorized by fte
@mmlegitrn $thlch albrus ttr Compary tg lnquase a q.srner dass't. rcvenue
rsqukrernent eoteU b ke€p fi6 Oompany ret Ettr o nemtal rlhen lt le hir, just and
reaonable to rduce EorE oomponentof thatcustrm€rdasds lab$:
RESPTO}ISE TD REOTTEET FIOR PODTIgTIOI{ ]O. ?:
(a) As ultt all rahe, dlaqter, ard crudlls In ldaho Fonclp hdfr, th€ Gorirpany
llbeto updat€ corils perbdbally ln oderb bep all reteq chaEet, and crpdlts cunerrt
rplttr the afin! @sfis hflnod bV tre Cornpany- ln fie Gonpanfs re\rorrLe rcqulprrtnt
cdculdion br the dstorflfimbn of basa rS8, fulU€e drargeo ate trcated aa a
iprrcnuo cmdfi. Thsrgbm, a rpdrdlon ln the rpronue crcdlt rssulte in an lnquse In the
lerreiilE taqulmd fiun base rat6. The Comparry bellaros thls ls fte apploprlab
rnannor ln wtrich b detornhe tls rerunln pqulrcment regardless of the yaar in whlofr
thc q.rrsntty dhcflw facilitos dwge rfr wes fitemlnsd. Thg Oomparry doer not
onslder the lrrrrel of fadtltlec clrarge sst br Sfiedrjo f g ctrsbmsrg !n 1987 in Ceso No.
IDA}P PO,UER COIIPA{YS RESFONSE TO TIG StCOhD REQ,E9TE
FORPRff'I'CTION OFTI{E II{DI,'SIRIAL OU TOMERI} OF IDA}O POT'YER.O
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFTCIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Erhlbit No.303
rBc-E-I1.08
RcdlngICIP
Page 3
Prge I I
$f0flL208 b bs a tnndhthered'nab b whioh t h enffiod inb pernAuny, Tttls h
er&hnoed by the Cunparfs curnfi ruquolt b adJmt Ute Ecltltica draEe rate. nlq
Gompany bdievso frrat I sttouH haw an opporilnlU b roowr lE prudcntly
msts and eam its auilrortsed rab of mfurrn. Thb le tue wfrsther he asaodabrl mrnnue
comee fium fieciffieo draqos or bace r&r.
(b) fil of tre funpanys tovtnme br 'nonrmrning draqee' qdt as
oonnecflon and dlgconnecfron c*rargcr re upll as field vlslt fiaru0l and serufte
€€bblhhrrent'$aqos are @bd ln the sams rnannor as fadlltls duryca ln tlrc
$mpanfe rtvtrile rcqulnmeril dsbrmlnaton br eadr dags. Thst b, aE tevlenuag
fiom norlecrrrlng fiargre rnow up or dorn neriting mm Crarqc in tr charye
anrourrts urffiqfi a oortupondirg dtflEo in @Bts,llr ruvunue luquitd frofir base rabg
lo natunally edfustsd accoding[, Furlher, undsr tre Oompsn1/s Rub H, Nw Sarvlce
AfrEctrrnenb and DhHbuilon Llno lnstallatbns or AlFratbns, rsuenuo oleciett fiom
contlbuffi ln ald of on*uefron (flAG') an boofte.d as a dired ofhd b the
oonryndng andomer dlasses' Ewnuo mqui,remenl As a reeul[ if tte GompAnfs
oolledhn of CIAC-s E roilrcd lbr a parfruhr customor de88, Oren fire @gpe'
Ths lesponse b U{B Requed was prcpard by Scott D. Speda, Sonbr
Regulatou Analyst, ldaho Pomr Compaiy, ln oonsrlbtbn wlth Jast B. Wllhms,
Corporde Counsol, [Caho Porcr Corrpany.
tD l{o poutER@MpAtavs RESFoNSE TorHE gECoND REouEsrs
rcR PRODUOTICN OF TtlE lI,lUlSTRlAt CU$TOMERS OF lIlAllO FOWER - 7 ErhlbttNo 3ll3
rPc-E-l1-08
Readtug ICIP
Prge d
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 12
RESTTESI F9R-PB0QUGI|O}{ !O.Jl0: ln rasponse to lGlPs Requeet for
Pmducfon hb. e (c) Ure Comparry Sated,'Rsvenue r'ecahnd fiom cudomers pa$ng
hdlities ohaoe B dimcfry lglahd b th GompalVs cost of ormlng, oparff1g, and
mahtalning fiEdti0eo thet an sohly dedlcated b thoe€ cusbmflB.'
Pleeso exphln wtry a decnase ln thc cort of ownlng, onenatlng, and melnbhlng
facilltla qhould causo the rrtea fDr the crnbmer dars b lncieaso. Doe ldaho Porer
agrm that U{s ls countsrlnElUw to ba$c rdarneldng dndples?
RESPOT{SE ,TO,BEqEBT FOR ffi@UCnOil }lo. 'f6: The @d of ouunho!
oparatng, ald malnhlnlrrg all Haho Potusrhclltties, includng thom subfect tb fiadll0es
clrarges, ls holuded ln the Conpanfs baae late rsvenus nqulrcment debmilnatlons.
llflrmrer, ln ruogniUon 0iat ldaho Pwuen recehr€s nrvenue firom cuebnrqs firrgugh'
1
facllltleE cheqee on oeilaln tsolatod hdll0ee, the Compqry ofhets lhe Ewnue
requirament that ryould othenrise be pmwred lhrough basc ratae wlth annual faciliUes
drarye revenues receivsd for ttrma Ssolabd fac{il6. lf the ftcllltles charye nte vrm
lnqsrtcd, thereby tncrnarlng fadlltles rcnonur, trr€ upuld traro to be an assodetsd
r€ducfion in basa rates. The oppoelle ls hrn yvhen the Iacfi0es rEb ls dwuasad, c
pronocd by tlre Company ln trlr case. Thc conpany does rrot agree that thls is
munbrlnhltrro to bqsic rstomaklrU prlndplee, but rather the Gompany bellerns lhat ltg
t sfrrent of [adll[€s c$aqe tevonue ls a[grfd trlth hsto fabmnklru prlnclplee.
Tlp um of 0re mpnue llom basa ntee end the rewnrc frrom lbdiUes c{raBce
ahlaF mfidcte tlre recovery of the mott cunsntly appmved cost of ouning, opetatlng,
and malntahlng faclllU€t. Thb vrcuH bo tte caee regardless of the amo$t of the
faoilirtlee charge rato. Ttre arpunt of ttre trcilih charge nate and 0re rssulting levelof
IDAFIO FOWERCOUPAO{YS RESPONSE TO T}IE SXTH NEq.'E3TS
FOR PRODUGNON OF 11{E II'IDUSTRIAL CTN}TOII,ER8 OF IOAHO POTI,ER - 2 ErhlbttNo.303
IPC-E 1148
Readlng,ICP
Page 5
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibil 8-B
Page 13
.,i
rEvERus lnclud€d i'n a rcrpnue ruquimment caee elnply ddemin€s ths anomt d fte
oonall tsv*lue requherpntr ttatille Company expe@to ollect{lun fadlltles cfrarge
customene and the amount b be lscowled in base nats.
The rsponoe b fih Roqued ma pmpamd W Tlnohy E. Tetrn, Senlor
Manager ol Gost of SeMce, Haho Power Gompany, ln orsufirtbn yvlth Jason B.
WUamq Comore Courml ldaho Potffi Gompany.
IOAHO POTA'ER@MPAIWSRESPOISEilOTHESIXBI REAUESTI} . \
FOR pRoDrrsnoN oF rHE tNDuSrfiAr cugromens oF tDAuo powER - 3 IfrH:rl$J*
Redlng,lCP
pogp 6
J. R. sIMpLor coMpANy's MorIoN To rAKE Page 14
OFFICIAL NOTICE ANDiOR OFFER INTO EVIDENCE.
Exhibit 8-B
.)
RE$TEST FOR,,PB@ttgttON ilO. fl: ln cspotne b lClPs Reqggtt for
Produdlon tlo.7:(a) the @mpmy $eted,'ln the Cornpwr/s rr\reture taquhTT
cdcnHlon br the deftermlndon d baoe ]ates, ftcllfles ctraEBc ara t€eted a$ a
(q) Pleam erplaln why the rpnfily payment of a facffies charga E
onrHered a 'credtf retrar than rewnue b llre Company eudr ae lhe nate per t-ltYh.
(b) PIEsG upbln fu[y lrur I nr€venuo cr€dlf dfbrc lion other nthly
rownuo the Company rwalrea fiom a qrffirs. Pbase dr ldantlff the Commlssbn
orUor, pqge€Ird llne number auilhsrEtng tftie 'tgl,snus cpdH tpfinett.
(a) Pleaoe emlain wtrdrrrttrerp tr a conespondirq :aetf or ohalgp b the
customer chss (or all qrdorner d6s) hrlhe Gompanfs oS associqtbd ntlth fio
frdllteo charW pdor to peynlent of tre lbdllflirs draEB by ttp qrsbmer and the 'ercdff
b the cu$ncr daag ewruc reqdremmt calculation. Pleare frily erlplein how ttre
ostr essocHed wlth md recowrsd for the facllltes charye am fia{rcd inb oach
pirace of ttp cahrh[bn of pvonue rqdnmsntand base ratee.
(d) Phase erehln how Sre cugbmerdass'E [srenue requkatrnt and beEo
rales unuld bo afieded by a lhllure of all cusbnren ln tre dass b pay the fadlitles
drage. ln that cas6, rrculd the Gompany mcowr lts osG aesodated nt l0t lfte hcilltles
ofrrqlWthrcughthe custorrer daes'6 base rateo nathsr than though lndlvklud
customdB' papnrilu of their ffilllb8 chargee? tf not, please elglain lrow the
Company rruould r€co\,er tha co& assodated wffi ttn iecffities lelord the polnt of
deliwry fbrthat cnffimsr dass.
lDAllO PO,t ER COlulPAttlyS RESPCtttBE To TllE SXm REOUESTE
FOR FRODUGT|oN OF'II}IE I]{DU!'IRIAL CT'S}TOMMS OF IDAHO POWER - /O ErhibttNo.303
IPC-E-I148
Rcadiog trCIP
Pegc 7
J. R, SIMPLOT COMPANY'S MOTION TOTAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 15
FESPOilSE rO RES|EST FOR pRODUGTOil ilO. {7:
(a) iroriltrty flcilitios drapes an boolod m otrer rurrcnue b Up Company
foi rsr,"nue requlrenrent dehrmlmffons. Reu*tun Foehrcd frorn cusmrners paylng e
facllltlee charge ls applbd as a crcdt or oftet fo the agsociated cuctomer classes' baso
tute rovenue regulmment Thls a@ourtlng tuafrnent h no difrlront than ]rw all 'OOnr
Retrenrre" ts credlbd b thcasochbd culbmerchssos' nronue ruqtementr.
(b) ldaho Porwr pr€paps its lgrerue oq,ilrenrent ln a goneral rdE oass {br
fite purpose of detemlnlng the l6vbl of tuvBnue b be mllectsd throngh bate fatss.
Becolse the purpe of $e tulrenue nquhement dotorilfilafron lg related b bese rale
dsrrstopnant, all no0ur Rernnuer'lB appll€d as an ofrat Thb aceur,thg taatsned
has boen autrorlad ln lhe,ldaho Pubtlc tltllilee CommtsElon s ('Commhslonr) approrral
of prwiously fil€d coct-of{oryko modds, imltding the Companfs tad goncral rab
case, IPGE-0&10, ffior l.lo - gTUz.
(c) Prior to accourillng 6r thE rewnue ftrom facllltes cftarges. all cosE for the
fad[tes lnstallGd beyord the Companfs polnt of dellvery arre included ln the aseocleled
cu*omer dffis' roffiuo requircment Wlpn tha facfiross cftaEo E\ie]rue h applied
as a reiltoue ctcdlt or ofE€t fie agcocld€d qlcftomer choees l€venue raquhement le
thereby rcduoed. Pteas Eeothe Gompanfs l€sponsoto Micron's Rsqu€st No. &,3 br
an exphnaton of hott tovenues arc aDplied as a qtdlt,in tha Companfe oostof-
aervlce modellng;
(d) lf the Company recelves levonue frorn fatllities charge cusbnrerE that ls
elther reduced or etirrilneted, then the arnount of the oftet or lovanus orcdit to tho
assodated cusbmer dassed rswrrue will be reduced and the owrall rcuenue
lDAr-ro prowER oorilPANYs pESpgt{g! To THE SlxTtl REot ESTS
FOR PRODU TON OF THE INDUSTRIAL CUSTOIIERS OF !DAfIO POIUER . 5 Erhiblt No.303
rPc-E-l1-{18
RerdingICIP
Prge I
,\
!
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE ANDiOR OFFER INTO EVIDENCE.
Exhibit 8-B
Prge 16
rqquircment fur that assocffisd cdofiier chss uill lncrwa m a rasult. ln a case
ruhere all eustomers ln a dars falle'd b pay llr hclliliee chagp, tte Compny rvould
rE@verall of lb oos0eaeroctsted u,lth treHlltlss draryottrrough the cu$nterdaee s
baso retee as tlrop mdd bo.no ofrtet (rtranrue crcdtt) O Oe qnblier daes. See thCI
tllrcd Teetlmonyof 86t D. Sperlo, p. 41, ilre Compant's lgcpomc b fie lnduofule!
Cwbrners of mho Fowefg flGPl tu$rcs fo,r Ptoducton Noe. 6(b), (a), and 'lE
whlch orptahr tror rududbng ln luvonue wlll rcault ln a conceponding lncracc ln
rg\onue rs$drerpnt frr fts +odded qsbmer chsg
The leapom to Xth Rquest t/uqs ptwand by $oot D. Sparks, Senbr
nagl.febry Analyrl, Ueho Poffi Cunpmy, ln mnsuliathn rrvlh Jason B. W0hms,
ConorAe Cound. ldaho Fonor Company.
lDAlto FoTER GOilIPAI{YS RESFOT{gE TO THE EXIH REOUESfrS
FOR PrcOUgflOlr OF THE hlDUSiltUAt Cl'STOMEftt OF IDAHO PoUUER - 6 Erhibtt No.303
IPc.E-l1{18
Reodlng,ICIP
Prge9
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 17
REOITEST,,{O, }$ tlurare Ad. 460 sd eafi subqccount cr€dnEd b Eteil
and any other cuebmer gruup? G;ib fr[ng l&ronms 6r sdl cr€dh,
RESFOil8E fO FFdJEST ifO. &9: Tha ffi r0sp in cr€dilf€ Ac@uil 456
t€vurt.oc b cucfrorncr groups b to deocry and frmcflonalEe eaci orbmr,rrt. Ag
$om on llnes ffs;Xn ol Larlrln Efilblt No. 31, eadr subacoorrrt that compdees
Amunt {50|e ch3dfed aB bolng dh€ronmlorrrpdfrd, dsnan$rcffid, orenotpB/-
rctebd atd ls fuiher ldeilned uith one or more of the CompsrVs oparatlng ftmdlons,
sud.r'as pmduction and/or tansmlsslon. One oadr sDgocouril has bson dassffied
end fundhnaltsed, e! rlroun in LarHn Extfbft ilo. 31, tre segmanbd ]Bwnuer ang
l1arlsferrrd b the 'Oilrer R*€nues' sumtmry table, pmvlchd as pagp 3 of Larkln
trrblt ilo. 3ll. Thls Ebb oomplhs mnmrttun AooourG 416, 451, {f}f, sltl 456 by
classlllcdon ard limcilonal category ln oder b al[n the rarlous ornponenb of oach
acoorrt u,th tre appopdab aloceflon fr&ru. After tlrco ttrr/onuc haye baen
confriled W classflca[on and func{ional c@pry, fhey ap albcated to nte dagsse as
stroun on pag€s 26 and 20 of Larkin Exhlblt flo, 30. Flnatly, clas&alocabd niwlr.Es
atg summGd on llnc 18 ot Lafiln Exhlblt I{o. 35, BsMng aa a qodt b eadr clelB in the
dawlopment d mal dae+cpeolft retonue rcqulmmentl.
The r€lponse b ttrE fuqueat was poparcd by Matheur T. larldn, nsgulatory
Anabafi ldaho PounrCompary, ln oonauhatbn wltlr Llse O. Notdsfiom, Laad Cqmrcl,
ldEho PowurGorpany.
IDA,HO POVYER OOTtlPAiIY'.s RESFOIEE TO THE THIRD PMDUCTION
REOIEST OF IfiGRON TECIIiELOOY, !!{C. TO DAI{, PTOI YER @ttPANr. 4 EftlbltNo.3ll3
rPc-E-1l-tlE
Reediug,ICIP
Page l0
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit E-B
Page l8
BEAORETHE
IITAIIO PUBIJC IMILITIES COMMISSION
CASE NO.IPC-8.11{IE
INDUSTRIAL CUSTOMERS OX' IDAHO POWER
READING, DI
TESTIMONY
E,XIIIBIT NO. iM4
Idaho Power's Retponses to Production Roquoot Nos. 21r22r23r24, i
25r 45,6A,64,65, 66 67,69, and 71 Regarding the Lack of
Doprociation of f,'acllitics Charge Equipment
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFTICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 19
)
RE$JEIT FOR PRODIICIIOI f{o. 2I: R*mno D[€ct Tdnony of Sooft
Sperfis, p. ES, tlnes 12-13 (shdrU hd lhe oBook lbpradallonl mmporpnl d he
lbdlitssctrarge usog oa straldt Hne amrurl Aepredatondaeleb boaed on a levellarl
3I yearHe).
(a) Please artmlt or rlery that the Compny doe no, ,"Orro" ffre prlndpal of
ttre lnl06l lnve&nst ln hclllU€s by a depretfdon faff. lf derry, pl€aso elq,hln ]row
thc Conrparry ruduoerttn ghdpal.
, (b) Pbar qtlmit or dqny that the prlndple lebt on thcm€6 su$ec't to ths
trclfifiss cfiarga h the sama ln ymr I c ftnordd beln pr50. lf deny. pleese cmhln.
REflPgr{iE rO REOITESI FOR tFODUCnqU ilO.2r:
(a) tlndor the Oorpart'e appov€d arul cftcff,B frcllltbt draqe :
mffidology, the pilndpal of he lnfral irnreafunont fur a piee of equlpmut does nd
drange unlees it ls rqnowd or nrplacad. l{orrevsr, the depmclathn comnonent of ttre , -),
faclfrtes ctrarge reprcs€nb a dedinllg rrt hk mlue that has been convoil€d inb a
lqnltasd anount bascd on a 3l-yearuaefullhb aaeumfion
:(b) Pleeee eeetha Companys isponcob (a)abob.
The r€Eponse b thh Request ws prepared by Saott D. Sparks, Senlor
Rogulabry Analyst, ldaho Power CompanS ln consultatbn wlfi Jason B. Wffams,
Corpofiato CounEql, ldaho PouBr Company.
IDA}IO POWER OOiilPA]tTYg RESPOI{SE TO THE SECOI.ID REOUESTSFoRPR(DtrcTmOFmEr,lDttlTRlAtctl$'fOMERSOFIUAK)FOWER-2S ErhrbrtNo30{
rPc-E.1r-oE
Reading ICIP
Prge I
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 20
;)
iFA|EBT FOR PRODUGTIOil tO.,U: Rdrrunoa tlr€d TedmgW of S€Dtt
Sparts, p. 38, lltea 12-13 (sffitg lhat &e "Book llepredaton' oomponent ot the
facilltbs charye uses'e $abftt fne anrual deprsdatlonol as8sb bared on a lerollzad
3{ ycar beris'). Pl6se odah why anilornerr ltnuH pey an sddilonaldtaqo forfte
deprccHon ln ralue d fit txrliloe Plear €Nddn ulry Oegaciahn in value of tho
trcilitlos overtlme lhordd not decrsesc lhe amount arsbmon pay ormrfrne ftr us of
that equlpnrtlnt.
. REsFOtgE II, REa!rFFT FoR qFoOUCIIOttl.]fo.,Z2r Pleaso see he
Compan/s responoo b the IrduCrlal Cu$mera of ldaho fuule/s CICIP) Rctprct for
fuoducfion ttlo.21.
Tho nccponoo to thte Requeot rms prrmarcrt by Sod O. $pG Senbr
Regrulatory Analyct ldatp Forcr Oonpery, ln coneultatbn wllh Jason B. WUbmq
Gorporao Gounsl ]daho Pwrer Company.
IDAHO FO,VER OOIIPANTS RESPChISE TO TI+E SEOOND REOIIESTS
FOR FRODUCf,ION OF fiE NDUSTRIAL CU TOMERS OF IDA}P 'FOWER.24
Erbtbtt No.304
IPC-E-r148
Rearlhg ICIP
Prge 2
J. R. SIMPLOT COMPANY'S MOTTON TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 2l
tHOllFgT;FoR PEOflfCIPtl,{O. 4!: tutulerre Dlred Tesffinony d Scotr
Spartr, P. 38, llrts 12-13 (ebtry tH tho 'Book [bp]Bc[don' oonponent of tto
lHliles ctu6e urys'a dndrt lfire annualdepraclatbn of a$S bssed on a lerrctzed
31 year basls). Pbso lderfiry any natebasad aacdlbrwlrnn m Gonmbdon allows
he Gommny b dralge tle gqne annual rS on the rrme pdndpal amount owr tlme
RESFd{SE IO REdlEsf FpR F[trpuqnOfl 1{O -r' nnlE arc no rate'
based attfr br whbh the Gsnmlsslon dlouc thc Conrpary b drarEto tre sanre
anrural ra.b qn tu same pfucipal arrunt orpr time urilren the vdus of tlre ass*
docrucsg owr Uilrc. Thb b abo not tfte cace u,ft fie faclldsc ctreryo. As dcmilbed
bv ifr, Spadoon pagp 38 of hlebdlmony, the{hdllile drargs le calqrhmd udqg a 3l-
rcar depredabb llfe aseumptbn.
The reryonce b fib Rsquosf w prapand by Sodt D. Sperl€, Scidor
Regnrlailory Aftny€0 ldaho Fower Oompany, ln omtilaton udth Jagon B. Willams,
Corpomte Couneel; lddr Pouar Cornpany.
lDAl{o Pd,YER @riPAtlYS RESFOI€E TO ftc sEooND REOUEST9
FOR PRODUCTION OFTIIE INDU$IRIAL CUSTOIIilERS OF IDAHO POWER-2E
)
i
ErhlbltNo.3fX
IPC.E.II{t
RearttngICIP
Page 3
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE,
Exhibit 8-B
Prge22
REOUEST FOR PRODUQI|Oil t{O. 24: Rsfio,Bnce Dlled To€thony of Scott
Sparts, p. gg, [nos 12-13 (rffing thd lhe 'Book Depredatlon' conporurt of the
fadlilies c{rage usos'a *ebttt ltne annna! rbpnetfim of ast& bald on a lewffi
3l yeerbaslsl.
(e) Phaso qghln what stapo ldaho Pourertakes lf a plece of eqripment ftlls
fiorb ftcexnlnilon of 0te S1-ysardeprudaton rchedde.
(b) Does the Cqltpdty luve maruhduu'E uuanlrflos on eny of thc
qUtpnrent cubtcd b the fdtHc drane?
(c) ltu tE Conpeny evw ffied an lnurSnoe chlm b ruphoo q${pmort
aubject the facnltl€s trrargo slnco 19S7?
nEsoilsE lQ nEouEsT FoR P,FDugrEl{ ilp.4:
(a) tf a phce of eglfnsnt ffi pilor b fio erelraton olrtp depreclailon\ ,,'' ,) sche.lu[e, tlon il ts rernovsd lionr he qsrner's f;ecittes cirargo [nrefrnent calanlallon
ard the hrrroEforoht oostB fur a roptacement piece of equlpm€nt is ad.l€rt to fio
customcf e fadlltiee drarya inwsffiiont
(b) The Comparry hes limlbd manufastm/s wararsec on 8omG €qutprrent
arQle{ b the trdllils chaqe, sudr as fia
(c) l.lo. Pleeaa ree hs Corrrpgt!/s recponse b lOlPc Requesn for Pmducilon
No.1g.
ThB rspongo b ftls R€slsgt war glparcd by Ss[ O. Spails, Senbr
ReguHory Analy$, ldaho Power g6svlpany, h onguffiatlon Wlsr Jaeon B; Wlllhms,
Corpomb Coun$l, ldatr Pffrer Oompany.
IDAI{O POI'UERCoYPfftr$ RESFOhISE TO THE gEOOND REOIJESTS, FORPRODT.TCflS|OFn{EilOIX,TR|AICI,SIIOMmiOFTOAHOFOI'YER:20 ErhibrtNo.304
IPC-E-I1{S
RerdngICIP '
Pege4
J. R. SIMPLOT COMPANY'S MOTION TO TAKE Page 23
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
REAUFSf FOR, PRm{FIIqil lP. 2E: $ronce Dirsc't T1tr1onV of Sot
Spadtr, p. 38, llnes 12-13 (dilng mat tlre 'Book tbprockUon' comporp;t of the
EcflUca dralge usos'E lhabht llne arnual depr€clailon d asffi bos€d on a lerlullzed
3l yearbasls').
(a) Pbase adaln il ldaho Porrcr contirues b daqo &o facllUes dtage
(ttr. morrthty percootage rab nrufrlpted bytho Cqnflys lnttlal lnva*nsnt) qfi€rtho 31
yBat dep]€ddhn paftd €xplrB3.
(b) For Sdrcdnles I, 19, 24 and Spechl Contrd,Ortorrrs, flease HenW
the oldd pF6s of eqrdpmsnt br whhh the Compwry b dll ass*E tto rtoffily
frciltlee ofiarga b a fldom€r h eadt dara. Pleeae lncdde the year the Compny
pudtffid and ln&ledfhe eqdpnrrt, lha Sdterlute of fie cufrmer, and the,lnltlal
coEtof fie plecg of squipment
(c) Wlth rrgatd to the fles of equlpmert Uenfified In (b), ls tho Gonrparry
$ll Galcttlailng the cusbmels' rpnhU facltlbo c$arge by rnultplylng the monthly
Elilbe chaqe percernegp byfic Fil[al lnvo&nent?
RESFOIsE To REOUE8T FOR PROnUlGnOil ilO. E
(a) Undor thc fadll0a dtage povEbns, ldaho Porcr chargoc a montrty
facltilsg fiargo fur equlprsrt lnsall€d bq,orid its point of delhrcry ar bng as t]r
equlpmort b instat€d attd ued and uefrd.
(b) For Schodute 9, th6 otde$ pb6s of equlpment (24 ln total) forwtrlch tha
Compny ls arsasolrg a monthlyfaclllttes draryo Ttt p,^["*, ard ffilled ln 1969
rvlilr a aomHrcd ini[al lnrrutfinent $15,329. For Schsdule 19, ttre oldest pieoes cf
equlpment (2 ln btal) ftr wlrlch ths Comparry ls asso3rlng a monthly facllltles ctrage
IDAHO PCn vER @UPAttlyS REBPTONEE rO THE SECOND REOI ESTS
FOR PROT'N.JCNON OF TTIE INDI.'TTTRIAL CWTOilERS OF IDAI{O POtlVER .2?ErhlbltNo.304
IPC-E-I1{8
Rerdlng ICIP
Page 5
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 24
ultB purdused etd hsftalled ln t0{5wilr sr lnlllal lnvelrpntof $250. },lo ru$oners
under Sdredtli.n 24alc be[q aaeassad a hcllfies chargn.
lmpoilanily, wltdror a pleoe of eqdpment lblh 5 lnatt or tl6 yare a{ter
lnstdlaton; the Conrpny, undrrthe i*" hc.llilbs draryr provisiona, wl[ rqlao the
plcac d esrhmcftt arrd adiust qr$omsrs' ftcllties clrargp {br ths eguipment bdm
rontov€d ald ttp eqrtrgnent beftq fr6lhrl
(o) Yes. Pleas rge fie Gonrpsnfe raBpon$ to (a) above.
fhe msOgnra b thE REqtrd rng pmperod by Sodt D. Spads, Se.rtol
Rsgulatory fuialld, Haho Porcr Company, h consdtstlor rr{h Jason B. Wllhms,
QEryoraE Couns-d, ldatm Fowar Cornpany.
nAHO FO,VER COitpAt{yE REBpOttSE TO THE SE@trtD REOUESTIS
rcR PROI'U TIoN OF TI{E ITDUSTRIAL CI,,STOMERS OF EAI{O POi'ER. 2S Exhlbtt No.30{
IP{C-D-1r{t
Rcrdlng,ICIP
Page 6
Prge 25J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
s!ffi=
rnorrEoIPcfiwn,
JASO{E.WLLIAIS
Conor*bCounrdlri[lrndlFlpaqrcfrgpm
Sepbmber22,2O1l
I'IA I{AND DEUTERY
Jesn D. J6rvstl, Secretary
ldaho Publlc Utllrues Commlgshn
472 Yl/edt Washlrg&n Str€at
Boise, ldaho 83720
Re: Case No.lPGE-t1-08
GensrelRate Gase
IlearMs. Jorell:
EndoE€d fur Rlhg arg en origlnal and one (1) copy of ldaho Poupr Companfe
Corrcta Reponse tothe lndustrhl Crstorrers of ldaho Fofle/sRsqueetfurPrcdu&n
No. 45 ln the .bo{6 matter. lt nas runtly dls@vgr€d lH a couple of lhe date ranggg
pmvlded ln tre table ln ldalo Power @mpanfe lnitial rosponsa urere lnconed. ln.
addltktn, language hae bsen added b the rerpome hr dadllcatlon. For everyone's
mnwnlenoe, thewodlng lhat has b€en added ordranged fiom ldaho Powsr Compenyi
lnithl neponse has been urderllned.
lf you have any quesffone about thls correcned rsponio, please do not hssitate to
oontac't me.
Ve'ry truly yours,
.)
]f.'fiSitibfr{BlmrrorqrpII6'E ll{t
Readlng ICIP
Prge 7
dw
Jason B. Wlliams
JBW:csb
EnclosurBg
cc: SeMce list
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 26
t1
RqlrEgT FpF PnODUgnOtl l{P. 3t: Refttene DlI"d Testltnony of Scot
Spail<s, pp.34-41.
(a) Hw long hs ldaho Fower dtarBcd a fecllites e*rarye lor Scfiqlulee 9,
18, ard SpsclalOonhact cudtinere?
O Ploffi prorndethe morffrlyfacllltles drarye fureaclr yoarqarUblyslnce
thc Gonrpany ntc b€gan ctraElru thg feflhs enargp lbr Sctrsrluhe 9, 19. and Spodal
Gontrel cuatomer who have paid a fadltleo drargB.
COfiREGIED nFlFQtEE rc RES|EST FQBP,BODU0TEil !No. rlt:
(a) E:rlstlno Company rcorde irdlcat€ that fircUtles cfraqes harm been kr
plaoe slne F€bnrary l995furSdudule 9, Janrary lg70 br Schedule 19, gnd 19O4 br
one speclal@nillact-
(b) Based on arnilable Company rsotda the hisbrlcal monthly facUttte
draEte rafies fior Scfrdule 0, Sdradule 19; and orp speohl onUac{ q.domer are
provldod ln the tabte bslow.
Yqr 8cfircrktbe Sch.dilr t0 Sprchl Gonbrct
l9g5 - ftseenl
tB76 - P.psent
10ol-191E
t97O - Prsssnt
1.796
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
1,7%
1.28%
1.7%
Tadfr and spqgld contr# ltrylsbm lrcnt inh effi ln Jenuerv l970_Whldl
lgr{qpq thq monrl{v faclitos char0e leic f(om I .28 rfc$rt b I .7 oercent oer, tle ldrho
FUb[c utlffies Commbsbn's Onler tlo. i23OT in Cess Nos. ttlUE-l(X, ild t:t(XF
101.
IDAHO PCtrVER OOUPAI{Ys OONRECTED RESPONSE TO T}IEiiliii5miAtti,H6fuHiHi6il6-tru'iili *eouesrRonpnourcroNr,ro.45- $xbrbrtNq.3MIPGE.IT48
Resdln&ICIP
Prge I
Page 27
The response b ttrls Request was peparcd by Scott D. Sprks, Senlor
Rqulatory Analyst, ldaho Powcr Compalry, In oonsut&rtlon wlth Jason B. Wllams,
Goporaf Gounsel, ldaho Porer Gompany.
I
IDAHO PIO'YER COMPANT"S GORRECTED RESPONSE TO TTIE
l[irj;in-rAi-ci,sririir'diioFirinib-porw'eh's REouEsr FoR pRn)ueroN No.4E - [HrI$i*
Reedlng IQIP
Pagc9
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Prge 28
\l
RESFIf EB IBOPI GflCIE;tlO. 0e: Refource the compan3le Recponse
b ICIP RequestNo.26.
(a) t fhat- b the arrenge ard rnedhn age lfn pare)'of dtstlbutbn fedlltes
all3talled bq/ond the pdnt of dr*h,lr ornurdy in rervlcc? Phese oqenhe the reponse
by echedule or Spedal ConfrBct.
(b) Whd B the avenga and medien age (in tr€ars) of dls0lbutlon faclHtlas
hstatled bqond fip poffi of deliw at tre fime that tlre equipnnnt frih or ls talrsr out of
ssrvlce by the Gompany? Pharc orgnntse the rerponee by edredule or S@alry :
nespouse ro neouFsr rqn ?noslcmon no. co:
(a) The avarAge ald medhn age (h !Ean) d dEtrlbutlon frelll0os lnstalled
and qrnpntly ln sonloe boyond tre Companys polnt of dellvery br Schedule 9,
Schedule lg, and one S@al Corilract qslorns Ie provlded ln the taUo beldr.
lua ntr^aa UadhnA.!,.
scneduleg 1l 11
Schedule 19 1E 16
SD€dalCmlrad ?A %
(b) The Company does not tradt or Fcord the awrage and nedlan age (ln
,eam) of dlgtlbution hdll0ca frrgtalld beyond Ere poirt of ddlvsr at he tlrn6 tM fi€
eqr&nentfailb orletdon outof cellco byUre Cornpany.
Tlp mryonge b thb Request tras prepared !y Scot D. Spadg, Senlor
Regllatory Analyet, lilano Porcr Company, in coneultaton vli[r Jason B. Wlflhms,
Corporats Counset, ldaho Power Compsny.
IDAHO POWER OOTI,IPANTS RESFO]IISE TO THE SD{rH REOUESTS
FC'R PROTX'CTION OF THE IT{)U{TTRhI GUSTOMERS OF IDA}IO POWER-z7 ErhtbitNo.304
rPc-E-Il-m
Rearllng ICIP
Prge 10
J. R, SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Erhibit 8-B
Page 29
RE, AUEST FOR P.BQPtlCTQlr rc. 0{: Relsronco tte Cottlpanfe Reeponee
b IOP Reque*t{o.45.
(a) Ploma povlde 0re Compan/s r€mrUe denonstratng rhat the hdli[ss
durge har been in place rlne 1005 ftr Sctpfule 9, 1gI8 fur Schedule 19, sld 198+
turS&eduh zeeedd ConM.
Edllios bt Drd $o polnt o, ddh,ury ptur b tlmo dds br sadt odreduh.
ltESpOt{sE ro RE(IE8T Ffi, FRODUCIIOil t0. C.:
a) Pleasa sep the atffired PDF f,le lbr Comparry rucotds dernonsha0rU
n'hon tro Hffies chaqe lrgrt m0 phoe 6r Sfidule9, Sc-ltslule 19, end Schedule
z9(Spedal Contrad).
b) Prbr b [rtelemcnqng @llte8 dtege prcthns, the odc assoclshd
u,lth most argilonrer{edicatod dtfrlbuton fadlltbs ffited boyond the Company'e
polrt d detvqy trele lncluded h $6 Compailfs gsn€r.l rS basa ard altocated b trs
msodabd qr$mer dago. For gonr hrye pqrsr ucort, the Cqnp*ry had reMce-
cont€cb h plae that acoouited ftrfrcfllUes indall€d beyond the Cormanfs pdnt d
I
/l
iI
ddhpry.
The rcryonee fo thb Htmt was
Regulabry Analys[ ldarho Pols Company.
Comorme Counml ldaho Powwoompany.
J. R, SIMPLOT COMPANY'S MOTION TOTAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Npargd by Scott D. Soarlte, sonlor
ln oonsultaflon uitr Jason B. Vlrifi€ilns,
IDA}IO FOIJI,ER @MPAItrS RE8FC,I{SE TO TT{E SEI,ETITTI{ REQTJEST9
FCR FRODIJSIIoN OF THE INDT'BIRIAI CI'STOMERS OF II'AHO POWER . 2 EillbttNor304nc-n.trlr
Rcrdtng ICIP
Page 1l
Page 30
lDAt{o Rott ER clsiPA}fv
rP-lr.c. r{o ., rARt}? No l0l QHGII{AI s}tEI iO. 9-2
scl{ElxE9
IaEGEGEM$L$mrcE
|Qonfln.dl
rrqEms Frroxb r,trr ponn or oanvrnr
f,OPIEIDUIIITBfiXTEilTI-MUE EFFGIEE
B5-S ffi1-S
At fi. opfron of ftd Corpcry. ffinrar srd s[r*lbcilllcs ffilrd bq|orld'lhi Foht ot
Drhsyio Ftot l{f Prlutry orTqnflHOn Scryba rruy br s4tqd. opcotca amd mcltrHnrd by lhc
Compoy kt oonldgrftn.of lhc grstfficpqfir o Foclfrc Chclgr ro rhc Cotmortf.
\.)
aprEUlCtrtr
lea8fr
2.6ru8,-
Fo!rcrfuA*rfuanl'
0.1,l)9t,
Ef€offr.ntr
2Jl97C prrkWhforoflkWh
>.3**B*rArL-mmr
Oomeqpmod Focilh B.yEnd tr. Potrl dDrltvryxril b. rcr bft h q Dffibutlon Footlllce[vrtnrnr R.porl fodara b tp grdgrrr. A. lh. Corpan& hueclnenf h Fodffioc Lyond fiA
Foht or.Dffrlrry onangcr n odr b prcrrldc fhr Ariomc/r trn loc aq$rmct$t, lhc Gsnpqry $dltdfy fic Acbrs ol ttrc odclfionslord/or &lldr of focillt by ltonmotfirg to th! C'rrdorisr o
ruttrd Dlt{bullon Fscffial lnvcslmrrt fuporf.
ln lho cvcnl tho Cudonrerrpqueah lhc Compsrv b rernorrc ornlrrtdl qcirqrEp Conpcrrr
outtud.FocilXce W lho Poht ol D.hr.ty, thc G;brrw tro0 pgy io hc Cryoy tr'non
$roHlc corl' of tr dt lurml rhsio0rdlsr or qhcfEp, Non€otvobls ost qs rlad trech b cotrrprtedditohildofttrrdcost of mqbdots,lsorond owtrsd ol ihe hoffie l€rc ltL dtrernor bcfrncntltalt obb co* OmoterU prnovcd qnd lrrmrrct l6ot sl hdrdrO egopEtr oveltrcoC coclr
PolmrlclEn
Wtrrc lho Criomrdr Fcnf,r Focilor b lG! ltror SS prccnt ot dcffired tly rnrormcnf
tmdcr Glud bad condlfonr, thc Compcrry.mc, osst ltre kW meonrcd lq dchirrlnc lhc Bffing
Ornrcma bV nnfmUhe the meewd l*Yby SO Fcrc€nf ond dvlfrre by ltp ocillrol Pmcr Fqsftr.
l0tmilf CHAnG;E
I?to lrffifirtf Clr@r B lhe q4n d fre Griomr. ho 8o$c.lhc Dcnrencl, thc EpEy. and lhetociltc Chqgs olrho bfryhrg shc
SECOITD+EYSIVIC'E
Cu*qErCncpc
$S.Opcrmehrpcmorlh
ladeChorac
1056 perklfl d Bsdc lood Copodty
DrhqndChqgc
$2J8 pr HY tc d ltW ol Donrond
rDAlto
klrd-Frbucy3.1995
efrahtc - fabnrry l, lttlt
PqIPUC fficrNo 25880
J, R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
lsu6dby|DAHOrcl
D. H. JoclooruVhef2l Wetf ldcrros
t.D.u.c. I0. lr. TAIIFF [0. l0l
sclEItrE r0 19 ,ulFor rllE srgg
YSIIffi* o! tlr Gerru'r dlrtrltutlgn ryrta tn trhb, for lor.ts ftq ,50 to ti,ooo ktlmtt3 rh.r!, rottr Cenltr'l iol. idimtr Gststlng f.ctlltf.t of .aBeata ourcrtrr rnd dcrlrcd uolt 0L rlt rdJrcc,rt to ttegreltc to t sGfucd. Ud rddltlonl iorr.Urt U thr Gmry fbr nu trcn!]lrrloir' $b.trtlor, dl3t?lurtlonor tetalul ?rcllltl.r lt not natrery to srDplf Ua dmtnd scwicrr r,rd erbJ.ct to grovlllurr let fofth {nrn ElrctDlc Saflrci llrrsrcnt itttrn tln oqtltV rd Gtit[r
@H*f*t- rlcctrlc scrrlc. lrnllqt to r cuttmr rt orr Drdt.. rlnr.r rII scwlcr r.gl{rd tr ttccnrtEr ls rugpllGl urdcr thls Sciattlr, rt olt! F{nt o? irltucirr ]d r:rwtrd thrurlh on! rdtcr l6t rooltc!n!! b rcrroml.'lrukdomr itrrCqyr rolnkGrtrrr, ncrtg $nnd rltalcE, illltt.ftilll, Oilllll$. rloctrtc0orlrrc o.csdlrlg 2;m0 ry arercld orlir-ruto umt.
MgHIHt rt r9prortrrtlty 60 gctc rrtd rt th? dtctrrtottor uoltrg. rv.tl.bte rt tie prcffsc tc tGsttrad.
lE+t-.ffi0carnrt, &crgr ud rrlgtlttt.s drrryec rt ttrr ftllntnE lrt€s
4t#-* fr for the rtrrt 2gtl lu ot ocrd2-05 pr (I for rrclr .ddltlond U of Drertd
etrHffl,r pif rnt for tNrc ftrrt rul tilt pr I of thlnd6.Il rlllr pcr ll5l for tm nec 190 litt plr Ot o? orond
{.10 rtlls Dtr IIll lor rll .ddltlorrl trfl- j
EEI{H#fr tc sumlted t mmd.r .r prt.rrli dtitrtrrtton yolrrg. rod rtu hlnt or Elter"tl stuli!. rnfra th3 GGDmyrt lfilt! ?l!!t.DlcD rdficflrt to Eutcer's DrlDGrtr. frrnr;?orrrr lrdror otlrrhcllltlcs' Drpnd tho Polnt of D.lly.ry rnrl usrd t0 drllv.? Donr rt utlllatloo voltrgo to golntr of l'rqat th optlm 0f Utc. Corpery7. rlr he orrd, opcmtrd and allntrlncd by GuIltty ln consl*ratlor of Custnrprrlol to-oqplnl !-ftgllllfq 9.ipgr of on. ard 3reln-tsrth! prrcril (t,7fl pcr Etrtt tlEs thc CnplrvrslEyGtftrt tr}ond ttrc Polot of oclluary
lllqtr Uoltrr. lrlrcolrrt (Ihen t.nlce ls trlen rt 4l ru or ahiue)$0 (f6 tht first zfl, fi of lf,rlnd0 ?f 0cr llf for arch ddlHolrr II of Dqld
Dand Eet$illnatlfi
-mTmffisrpplld
tfiFirg th. l&co0sccrrgtu.-rlnwc pGrlod of mxlan rrl. drrleg th. FnthradJurhd fbr p9rrr frctor. Dut mt lacs than lfi [Cl (rot lecc thrn l5[i lt tficn serulcr ls supp]tad rt{4 K or $oya)
!ryftffiHr mrr !t ctor ts lels ttrn 851. rs dctarrrned !, rrtoiru uiltar tctull lo.cdondltlmr. tln Cqrny oli rdturt tlre tA mrsurrd tottilslm th. fcid by tultlptytng tho mturrd flX
bJr 85 rnd d{yldlog b,thc.ctlrl Dorcr f.ctor
@f,L*ffi, chrrge shtt tc thc llcllltt.r drtrt plot ttr. hrthct of thc iollorlng
(SI Ttu hnd ciuge for tha flrr.nt Int,lilr arrlnn 0aacd
(B) lo cnount sufflcl.nt to mkr tllG otil rld En.roy Ghsry.. for sfltc! uuter ?ll. lgFtlrent,for dle lz.Dntlll D.r.lod crdlng s{th th. GrtrFnrt Enth, {url lo I 6 tlms tlle Brlrri'
Hllrll:y.ll:[rd for w roti drrlng tlE t.lr of tlr lgrcrutt rd rry il'rEls or
(C) Th€ nltim chrrge speclfld tn tia lgrer$rt Tlte Cslrprrv ry itqulru the fustapr to
exscut0 I se| vlca rgrur:nt srelfylni i illhGr .fnlirls rnnllrl clrlrtc lhrn rculd tcprlvrd[d uid.r (1, or (ll ilri rrccc*iry to lmttttr thc CQtry's lwtttlEnt la rrrrlccfacllltl€8
r0illoiiEirO - J.nurry 26, a975 Issucd [r IUIO P0IER c0l]tt{YEffeettv. - Jrnurry ze, 1976 u ,rllcs E 8ilfE, Pllsldsttt;-a;rc ord;-,rr.'tttot -' taa6'tc*ro stnlE,-ioir+ ioitro BllHI#*
Rerdlng,ICIP
P'age 13
.l
J, R. STMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Erhibit 8-B
Page32
,\,,)
' l6m@ soR BUPSrjr @ mlllm Am El@u
,L:ffi,H#
DAM M@ filEIITT
o.! @ f,(@vJ, &iE aad ector:n lffo tha yaagr of ry-
1961r, ty aadl, DctErB, B SDGIdE @@Iffi, ea lddo oouEqf qremtr.us a DiLalrt
lor thc nnudnctlo of fcrtlltgtr arar DooetclJp, li$op hcrci.uefEer nfea(l
to as r!frstocr;n aad. DAE BOfm 6olP!$f, an el.ectr{,c uttltty artho*tssC
to do hrlaaca lD the State of lieho, hsctlaftar nderreO to as t'0qnodt,
tIItsr888EIE!
O.2 IlmAB, rf B giq6flot Oqla$V Daq plonearei the use d Souttrarq Idebora
!fuo€Ebstc rrcts defpstta s!. for naDV ybarr Xas o;r.mtetr e l[laqt ree Fooetelllo,
T&, proossehg pbosphec soot ,.a oiler to ryr3rrlr* lrhogl&ate lsrtiillrasal
4r0 at R Brqriot O4lery is lov la t&e l,rtroesE of last+rUrg I E€tr lmoda
Illrst fo,r tbo proi\rotto of, vrrtroue glaaos of uoU lrhoeE&d,e tgltl-trlrosr,
ltbtcb nar pLut vf:.f rcertr-e t,!c rfs€ of lBcilo9stDglry lrsgp mustE of lornr
la oslpt to lroccaa ths p@qrh,btc irooL aDA tba cncqbilc lrol5r rcgnfrep*nrta
at tEg plaut leve lnot=as€d. mm qxG.natoly I,OOO f,II tr L952 to ryfsqa-
Bt€Lf 61800 & t[ 195e, aEa lt 19 EttcrtEtdl thal tlp rcr @nta lll.eut
r:Ill lacrca,se tbq trrorcr raqrrlmetr to qgnrrlmtcly l5rO0O El; sA
0.3 II@EEAB, tu. oortrfltc0 Etoryth ehi[ ealnnrton ot tEa ptrgt .rO tDs
ule and alsr€Loloct of tbs phogpbpte lost alqpalts of gq$Ucra ldeho am of
rttel ,Elortsna€ to tDc @ttth aui lmalnrlty of, tbc 6oory of tha Stata
of Xdato @A ths sifr&iLtsb.at of aa trdrrrtr{aL rqtc &r Elactr*o l}ortrp
srry4flSeit to ttstg tJle of, busimre rile r*,crdaLly BtA ault aselst tbe ccoaqr
of IildDci anO
o.Is nlEtsEgg, tb3 Iitsbo Dorer coqrany Leg dgreLqled e largs ttrinrEtrial
r:sta for euetorrarg nboge uaeg rlLL fe U tUe aeiglrborbood of l$rfr)O !fl ol
Erhtbit No 304
IFC-E ll{tt
Reedi4g,ICIP
Page t{
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Erhibit 8-B
-2 -
rcle ar0 are ilgpge0, Irr the 8tafie of ldabo, ta Dltrtn8, d.rah8, @sIttngr,
roftn.fug or prccesefug, rfiEre such 0elfi/aty cas be uadr f,r@ tba OqnqJrlg
acUtfug ISO fV tmrselgelo! ltres rdthrnrt rcgrlrt"ug aaltttloEcl qnarc for
factlttlcs aUX[LleA !f tbe Oopaog; a,ntl
e loe0 of the J n 6t I Piant aead0.5 @SOr, tUE lr.A of the J n 614[tot Ooryary et ltr
BooateLlo rLLL ueet thcec reEulreosrta, alnca tLle Loc& rltlX bG'uicA 1n
pmccgalugl ilellver;r o& bc ueile et tes GcuBanyta cd.sttlg DoB $rbrtetlm
.tiltbout adltlttoDal €fi[)3lse to th6 C@pq? anil t]e rate rlIL aLA fr asvefgDr"ug
rsil losterlrg the ecorrsr of, lilaho; aad.
.0.6 I{EBE|8, f,he lEl*les bsEta ilasiDe to Bot f,osth cln eghDtrlsh tbe
ter:ug o'ri ooailt-ttonc rradar rlrtoft pornr ra[ be cvailaDle to Gtgtmr;
f,Ult, l@{8, ta oouet0sufiloa of t&e proLaea ariL tDp urfilrI
beueftts hcr tba sovuaato heretua,fter eat f,orth, the trnrfrlea hlrrEy agrs
as f,lo[LouE z
A..tfeLe I - $am of .fisfsgp€ut-
1.!, 'l't'a or*gl,aaL tesrn of, thta agrc€&ssfr gla]ll. be fior e pertol legr.uifue
oa tbp dlate of, latttal. sonrleg and €aaftg JlEs 30, lrll+, l|htoh tcrm aDaLL
be autqnrtlaslly rqprud Euil st@ib0 f,or alr adiltf@al. prlo0 oC Ctvc (:)
Farar uiif 'frcB lB"ar to ysaa thpleaftcu, unJ.eEc enil unti,J. cl.tbe pariy E&ELI
aotfry tbe othon lroty f! rirfti.Dg aort lcas t$an tvelve (U),wtbs pstof to
ally a&ih eryrt:etloa'date of lts Latastlm to tepluate tLtg agllseEt'
I;2 l$s Alte of, Lultla]. scmrlce ruilar thts aSre@Est shall ba tha f,lrat
day of tIst. eqtb l:l r,hlob tho OnBt@c:r f,trst .st6D:U€bcc a uaxfuu ilgpanit
of lOrOO0 kl,Iormtte of porer,
'Arttcl.e 4 - bqer to be grrrrqUeaf
2.t lEe Custorcr qgrltlEs to gulohas€, rsoelrE aron Day f,or, anil tDe Coryaoy
rgrBer to el{,p]\y, alr cLectrlo gerrlce rrq|rlrEa by ClrgtmEr tor tts ffihlffif;nm4' IPC-E 11-08
RerdingICIP
Prgc 15
/i
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 34
. -3-
Derrrrfrrtul'bg o1arotLora aBar hcatalto, Iilrto, sucb pcer anO cncrgl', tl1, to tDe
s4nEt of 201000 tllorette, sba,XL be srUpttail aA !l8t:A lor et tbe rate 8et lortL
l'a paragraUfi r.l, lt betrg agraed, tDat rhco tbe Grt@rio dmaa qeecib nrab
lt tg 'liDc lttcotlon of t&e lra*ttcr tbat D.r anA oUprce0tag trtce vllit be
a€FlcA rryro, qEltlelD!.e to Ortmorro loe! aro senrtso a3 tils !tqEt!cd'.
2.2 &c Outraet ecnrtl o! tJrlg egrc@Et tor eaob -r-q rba1l te trbc uaduu
d€DeA (f.fh$atte) otr llo*er ta&ea by Cnslmor to auy aloc& b{lf-hsrq ,Et.wa1
Ourtng tle oela0ar tfuh hrt aot lEgs thsa 15rO@ Ef; provlileA. **t" Orrfag
tbc Adr,alofoelrt lprtoe anbscqucot to thq 6ats otr lEttta]. terrloer thc Goqtract
.lEfiErt .fc thc rcutb Bh.Il be the actrral neliuru al@al (ts$bmttr) ah!.f"!soit to
firctoer ln aqy sfbce half-hmr Der{oe err rB tbe ceLcuil.a nontb. U Ooartract
.luanat to,r t&e eqpllod teu- of tbts agrcuoat shall De tlb narfm Oortracb
lmurt cst&J,tghsif 1! gry umtb outaiqrreot to tb€ itrate oC lrEtttal. scwt@ un,pf
thLa agrumuu
Artlclp III - lbfr.ltttes to be Prrovtda0
3.1 Bolrur anlt rusrigy to br .r{Dlteif berguniler try tb. Oo;nqf tg evtt}elblc to
tDe Gtatosr Et l2r5o0 volta at the Oooparyts DoD Eubrtrtloa aeas SocatclJol !0aho,
rltbot* adiottXoEal trrEgfuDt by the cqElr. AIt taollLttler lmlulllng anltdllng,
trnarfoluatlou, rcgulatlon $adl lEut,cctiTe ilgvtcog Doac.Eaalr &a tD. &llwrZ ot
Dorur an0 encr4pr at t&st !otr$ dre lastall€al
3.2 llhc Gratcriror aesnedta tbe Ooryany an0 tLe 0qrquy i,s lgrecrbb to tlrtrtl,
oE, oDemtG, aDd, dedatat! tlhe fecllttles nbceaea,ry to ilEllver tbe porrr $m
tb€ Don Subgtatlon to tbr Gretoucrrs I,:lBt st IE,ISOO voltr au0 tbc trqoBtlorua-
tloo e$rlX,osbt r=,gltred, by Grstoerre rrtllizetIoA ogrrl;mt. CESoET agress
to Pef tDe cost of sucb factllttee Enil cguttroeat tB aecoltan-Gtr r{tn tbe prr-
vlelong of, larraerapb 5.1+ fDrra. l{Btetil&L aadt lator nBqEt}€d bafrond lrho aecoaiantrr
temluels of traasforrerg eball te tnatr.lLed, olrued, otErBtaA, EarrtaLmo, a[O
3nl,O for by Grstgmer. ft ls unilergtooil end agreeiL that alr the rcrL lf,rfor34tQ. ErhlbltNo3M
IPC-E-Ir{8
Reedlng; ICIP
Page 15
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 35
-l+-
by tbe 0oqany rrailer thl,a pa,ragrapD sblJ. be ln eocoillElree rrltb atrL lpcaJ. aati
stcte nrles aS. regrlatfoqg Lr reEIEot to soustnrqtloa oE Eat-A tlalJ.ltlee,
aail, tDc cflftr'+at uee0 eha,Ll [g gtrnir'{l Xt@s t! tle oqaayrt ttEta.
3.3 It te nnilaratoo0 adt agra€al tDst tho faaLlttlcg reEl*scll, by Ouetlcr
lay vary l5m tlao to tLuc, eaA tDc 0reaay'e Lurribd la tbcge facXlitfes
rrynu {bfcb oDargos bcmla Ehe.lL b6 basa, BLTIL b6 Oc6Er:rLneiL fi accor{m.oe
rtth t[s Oculnnyts eolual boetreeplng aSrsto. Ihg qrt@t 1*, to pttfloa
of auy cbmge tr ogl{1rneut or tmostrent, et tbe euLlcst prusEteal alata !ub.c-
gucEt to aay clalg3 ta arr& egrtpcat or lnvegtaErt, Dy J,eliter fim tb€ @epy'
'to Grstsol, trbl,cL l.Ett€t' or Irrttere of potlttcatloa eaXI ecqutee Hrtblt t
ruA shdl]. te e pe:t otr tiXs agreucrb, aad, crsb su$ leftce abailL sbr tDs
aet lavestoent tacurrud by tDe Cqlary La faallLtlcE rEq[IJ.A to daltter lrou]r
ald. erergr fu tbe Iton &rbetatlou to tLe G*atoertE pJar0.
lrtlcLe J[ - Bervtce Erlealf,Loetlong
lr.I !&c clcctr{c Iotur n4grl.led rual€tr tbt, ageryb dhEIJ. te ,:a tt€ torcu
of three-Xhaee, alterretl,rrg ornrest et a f,ieEuenay of q6xrod.totely 60 ryobe
Dcr gaso-4, s,r0 S a rmd.na]. phaoe to pbage fpterttraL:of qE)&Ed"rrfufv Jar'np
volta ero€y! uader eoargoro:tr couilltlors.
L.e lhc polst of ltnit:lvcqtr for Inrat a64il.1edl hreirdsr sUeI[ ba on tbe
Er50O yolt stds of tlhp Cqroy'a Doa firbstatl,oa looatsd apar !oeete![o, Ida[o.
I+.3 @e @apv rrf[ pisrf0e ButtabLE Dstortrg egl&ns$ fon oUtehtrg
neegumE|Ebs u€qrLrllt llr @loottoa fflth BEttl@equg ulilrir titla agreeoat.
oqpany aDaLL, at lta olE €4|ease, test suou uoterr^ug eq|rl mnt oace ta aaoh
aaLerlar year.
Artlsle V - Charggg
5.1 .[lt eJactr,lc pou€" aail eaer6r, rrB to tlp esurt berstuabovo qrecl,f,teO.,
ErbtbltNo.304
IPcd-l1.08
Readtng,ICIP
Page 17
'. . --,/ i
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 36
\.. )
-r-
!Ldj[ t rqEl.l.if .d pefl tor st tUe Cryaryrr Focatalllo o0ficc l^a aoaodt-
aacs rtth th6 ,o]JoEtrg umthl3r rate:
(a) Dsld, oiecEc -
t1.80 p.s m of BtIUng D@aon
(u) Eaeryr mry - _ _3.0 r1llr lm 8E tor atrll cnrrgr
(o) EtIlLag Doau0
,Ds Bil.Iafn8 D4arA &aXt ta tbe.0outrest lmut of
ItouEs !dE.& cnrrreut rcEth cgtsbl:!.ahrc &r accoEloanct
r:fttr Da,:ilgryb 2.2.
(d) 1E n&flllheul qbarge -I,tt afEer tis dete of thle agreosrt, s4/ rsr or la-
entirod tor or t&a (otbc tihao l.aooe tss a[il. taxBt Dtscil oa ,acru) lFUabfc W oqlary a,tle t4nacil
lgor lsgtws r=€etrlrcil fto &rtcoar Derruoilcn u
qp@ lotllr or uolsr aoli to alBtola! bar€ludtcr, orqm Itomr or oegr gmsratce ftr 9TEEEV oE QrrtsrLcru8its, ftctolor lhCll !Ey, ln adlttloa to tD!
ohar8ps Dett.prbomr qnolf,led, aa souut ad)tlclcatto ocrBt gtrg arclr tacar paVablls Uy Aq*ry.
5.2 IlDc etntaru loEtlty qry ghstrl be an @uzt cca*1 to ierOO tloes
ttsc Oolttlact .buEt tb! tDE ql:lrcA tcn of tnfe .grocoaat la ascosrlrsce v:ltb,
lEsr8lqDb 2.2.
,.3 Frnr Abtor.oostEotlTo qDDargtus ot cqlrllEmt roaB38rlr to lBrstail
ct aLl t!no! ao D.af unlty lnral lastor as ltoEdtblo ghetil ba Drwl0aA by
Arstmt, borcver, l[ 6Bu Qrgt@rrg Ilorcs t€ator tu lom tD.! .9, IagC!&
tDc Oqpry gEBII E"c tb fl8re *il uqr eLegt to Iartrll alitl-tlaEt,I. Do.nT
faglor corecrttve cgtlmnt l^r, asoordauso rffi ern unicr tbs Dadrirl,ou! ot
!,aragrqtb 3.3 berbd
5.\ . & aoiqslatEti.oa fo,r tDe fiaclltttca tnsfralJ.eil W tbB Corpry fa
q€cor{&ce rr.tb.A*tst€ Ut, A..t*r sba,Ll Dqf to 0qlaqr eacb aotb oae
and. ooe-qtartar pemot (ft*) of t0o totel coat to t&e Ooqmy as lbom lD
tDe fagt letter subttttc0 tfi CqanV to Grstoer lu E*hlbtt A of t'hlo ogrrcumt.
ErhibttNo.304
IPC-n-rr{E
Rerding ICIP
Pcge lt
J. RI SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 37
-6
Ia thc 6ront 1t baecrpr D:caasarlr to rersvr tha faElltttes lnet&IleA by tn
Oryeay as grurtdse by Adlole III edl rtl"ustall'or chaogp tbc flactllttlts,
tbe Grstouer rhell 1ny to Oqlaov tbc oaoa-pa.lvablc costo of mcb rocrvi,t,
tigLartall.oBlo or ahrtrlci rco-of"*le,cogt ea ucO !.rela ts oqu{,reil of
tDe tota3. ooat o! uaterlal, laDor aail oniilssds of ,.Est€LEag tic frotltttec,
laee ttrD 0l.fhmaos bctnen tls galrrablg ooet of uatsrletr ruovoC rnil, tt
revr1 f$otr oort llclrritag elDDolrlata overhaaA cetts.
lrutc*-qk-I.ratrutU
6.r Eueu ,qrby *ur t,ffi"* hs.mt ce tho ofrDffi Dtfiy agstrst,
Jocsl daurgc on tleblXtty, exoluslva of corts au!, attemyar !cca, lcsttltirg
tbo cLetag ass€rhA t, tl[s0 pcrBaos agetalt cttbpr or botL prStca to ttL!
a€rleat ou, sosourt of tuJurv or (bEBb to tlcaroEl or iluqe or ibrtrir$toa
of Drslrerty oeorrtlg 6 anob (hasmr$drg) party'r rL(b o! tLs af,orcretil,
Ipf"Bt of 0c11rcry, ustrccs zucb raJury c {toagp analt Levc raofltcd. er@ tb3
solo acgllgpuec oC tlg otnsu ne,rty; IEgofec$, hotwsr, tiet eaob DailtV sDall
be aol.cly rrstlusib!, for oltslns of a,rd, llaucnta to ttB cqfopce 8nA g3stg
ftr tlrJurfea odarrrrlag !a eooagtlou rltb tD€1r {$Ioynffit or arirl,ns ont oE
t.ulr rorhmts cqnnSetion irv.
Arttsle Vtf - tlatvers
7.1 .A4r m,tver at anlr tloe hy elthsr pg$y of a rlgE! .trltb toql cO to augr
aarbtcr a?fc&g ruilgr thta ag$€u$$, or lay f,dfun to gtso etgr aobloo trrrror{&if
lor horsu,nllcr1 oDaL[ lot tc Aocnnge to bG t valter r:ltL roe3nct te ay rt&ac-
qnaat Eattcr, Dor u tL. cststlllshcot of or cacent to aay prract!.ce undbr
tble agre€n€nt or aa 1utcrTEttBt'toa of uqr tem or 5nrotrlclo bsrrot,
EillbltNo.30{
rPc-E-I14t
Reediog ICIP
Page 19
.t
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Pege 38
-T-
Artlqls TEII - &cocarorj anit-.flg*rrs
8.X. Ibta egr.ssct Bhatr1 fmllc to the t4€f1t of ad. be bfadfag rPsn
tDe EucoBs6or6 ,a lutcrert, a86l.g!6 ann Lgal rellratutatiTss of GrEt@3!
euA Oopry.
Alti.clc II - (hmlgEloq .IttLrdtctton
9.1 Ebtg agrnreut, tbs rrfiee, terre aa0 prsrlsimr tralela sd tlorlth, BtrO
tbe rgpesttve rtgEbg a,uit obllgatlse of tfie xlartleg Ellrd.r, +!U be arb-
Jast to tb Aurr.oiEctlq e!i[ negrlatorjp artborlty of tb. Ideho hbJlc lttlXttler
Omtasto asd ths LerB of thc gtBtc of, tr0sho.
l:lti,Cle X:trlerd.natr.h of Eettrr Agom€Et
10.1 lhs ooqtraot bcrtrla tbe partler, datcA fiLIy 13, !ffi, 1o bslctg
tcrd.nstGil or thr dgtc of frffi,al eerrlcc gst forEh fr pragragh X..2 of tbLt
agreomt.
I[ II.IIrEBB fl@, tfto xla,rtLae bme ocouttaa thi,r ag!9@cqt by lDctr
rtalncrtiru Drcpor of,ttoera, .tIersunto duIV aftDorlzeil, o -tbc dlly auil par
trrFt brar.uaDot! rrrdtt@.
ar R sE[dn @@f,rr
(conmnss gmr,)
(oonpongm Eer,)
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
q 4- a -t(12' --z/}z:EeafA.iEb
IDAM MI@ OOIPIII-Ms
ExhibttNo.304
rPGE-11.{t8
Readlng ICIP
Prge 20
Page 39
REOUFSI FOR ?RODllgT,h0l lrc.. Q5: Referurce the Oompanls Reaporye
0 lClP Request No. 45, atatl4g ftd the trc{lfrles drarge hao been ln place slne 1995
br Sohedub 9, {976 br Scfstub 19, and 1964 tu Sdradub zgrspedal Confrad.
Ple.se rcondle thls $aternont ufflr Oompanfe Reponm b IOP Roqusst No. 26(b),
$a[ing thd ttre oldatt plcce of eqr|prpnt ffilbd ftr Sche&le I ruas imtell€d in 19O9,
for Sclrg(Me 19 was lnstaled in 1045, ard Compaq/a Reaponeo b lClP fuquest No.
25(c), elEtng thef ms Corrpany b dlll cdoilatlng Sre monhly facllltbs duns by
mufrplytrrg the rpn$ly fecfli[es dtatgp pa@o by trs initial{nrccfittent br theee
ploces of eqttlpmenl.
For eltrdprnert alraady h trc ComnanfE pdss€sslon et h€ tme of
comngrcomqil of ha hdftr'ac ciarge, dH he Gompany rse the valrr of the hfflal
lnvetftnent or the depmcletcd rnhn of the equlprnent at lho tlnre of orrllofirment d
FSPOifSE TO EEQUEST FOR PROS|CIEiI tIO. 6* The equlpnrent
rugrtlfiod ln the Corpany's Response b t?re lrdusffiat Cr.ffimqs of ldatro Porre/e
('lClP') Requeet No. 26(b) nas lnstalled priorto lmplemerltadon of the fadll0c cfiargc
lbr SchedrJes g ard 19. Onoe ho fadlre cfiarge provisbns ruere apporred by ths
ldalp PuUIC Uinieo Oormlsshn ("Comrdsoion' or "]PUC") and implemenbd per tlre
Compaq/s lailfi sfisduhe, tte lnUel rralue of thls custorner{edlcat€d equlpment was
lrildudod on the assoclabd cusme/s lrhtrlbutm Facfrtbs lnrlcgffient rgport fDFf)
usod to calculdc the monthlyfadlitec c{rarge. As stet€d in the Gorrpanl/a ruogonse b
ElFg Rosrcst l{o. 2fa), thc equhment will mrndn on the DFI ae bng as lt ls lndalled
and rred and uefrtl.
!DA}(} PO'YER @IIPANTS RESFOI.ISE TO TIIE SEVET$H REOI.ESTS
ftIR FROfl'GNON OF TI{E INDUSTRIAT CUST(nIET OF DAHO POIIIIER. 3 ExLlbltNo.304
rPc-E-ll.ll8
Readlng,ICIP
P.age 21
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 40
For hdltlos boyond thc po[rt of dcllvery. lhat uuere ln sendce and in the
Companfr pocretdon prlor b lnphmelilaflon of the frciltleg fiarye pmvlsbne, tlra
Company usod fts lniUal hrnrtnem h As calcr.rlathn of the.montrly facl[U€s charge.
The Conrpanfs ry DH'g droy lhe lrfrarl lmrcfnent values rreed to cahrlab eaclt
ftcilUes drarge ou$mFs monfrily hdlfrs cfrarge. The rp d depredated values
hac nolgr been appowrl by lhe Gommlasion and the Cornpary fras nevar qsO
OepnAOO \ralu6 b calq,rhte montilylHitics draErc
The ruaponse b tl'rls Rcqrsst wag prspamd by Sott D. Spails, Smlor
Regulabry Anah/st, ldalp kluler Oompany, in onsultation with Jason B. Wi[hmq
Corporab Counael, ldaho Fm€r Corpany.
fDAIJO FO,VER @iIPAt{vg REISFOIISIE TO'TtlE S€r,ENttl REQI ESTS
FOR FROOUCflON OF TllE II\DITSTRIAL CUSTOIIffiS OF lDAt0 FOWER - 4
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
ExhlbttNo.304
IPC-E 11.08
gsadlng, ICIP
Prye22
Page 4l
REaUEST FOR PR(DIJCIEN ..ilO. E8: Wilt mgad to fiE equhment
dbqrs*d kr Requed t{o. 65, dld the Company begnn chaElng tp cudomer ln
Sctrqhie I a fadliles cftaEe h 1995 basod upsr 0re inlflal lnveetmeil in a plee of
qulpment frdalcd ln 19@, or did tre Cornpany uce the deptadabd vah.re of the 1969
ple6 of equlpmcnt ln lS6? Vyhd vaftra dH fte Csnpeny use and barsl on nrlrat
deflrdatbn rofiedule
REIFOIISE TO REQIIEST FOR FROIlllGTlOil llo. G0: Pleasa s€ ths
Gonrpanfr caponseb l0lPs Requc*No. 65.
The rrynre b thts Rsque$ rlas pmparad by Scott D. Spade, Senlor
Regu!ffiry Anallct, ldaho Fornr Gompalry, ln conqrttdon ufrfi Jamn B. Wlllams,
Goponb @tmrel, ldaho Porusr @npanf
IDAHO Por,t ERCOiPAi{YS RESPONSE TO THE SArEttflH REOI ESTS- aRoDa,cnonoinrelnsusrmnlcDsrouensoFnAlopowER.E f_tBIrI#4 l
Readln3rICIP
Pege 23
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Prge 42
Wft tpgad b tto equlPment,
dlursaa( ln tuqrnd llo. 05:
(a) DH the Corrpanybegan otrarglng the cusfdmerin Schedub 19 a faciliUes
drergp ln t97O bsrsd rpon the lnlthl FwHrrant h a plee d equipment :lffi|t€d ln
1e45, ordid the Compmy uge ths @ladabd value of the 1909 plsco of eqrdprnent ln
1905?
(b) What wlue dts he Comparry uae sd baBod on whet deprcclaton
sctpdule? Whd due b tre CqnparV rdng for ttds Sece of quhnsrt bday, the
value at lnrflaltathn ln 1g46, or thc daprsd#d value when he c{raqe oomrnenced in
1g?e?
(c) Plsese orphkt u,try tris plee of cqu$ment wae not fully dqredated at
the frn€ Ure Gorrpsny hlliabd tF lhdlific chsge 31 yeals afur the equhmeil wae
lnltlallyindalled.
(d) Pbase erplaln hof,, fiB Company hae rpt orrer-recovelgd for this fidly
dsp,rEdatsd acssttom the Sch€duh l9 cr&rnerdrce 1976?
frEsPtoiltE ro RFerE9[ F,oR PRmusnoil ilo:67:
(a) Pt€ase ceethe Corpan/a lwponeeb lOlPc Rcquert t'to. 05.
(b) PlearemhoGompanys rupoffieb lClP'E Reqr.lest No.05.
(c) lnddlng the dorcdated rahp of equiprnent at ho tme ttp Comparry
hltlated the fiedlltl€s draEe wa rmt and arrcnilly is not, tre Commlsslorrappoved
mdrodologu for catculding moilhly hdll0es drarge under0re CompaVs tatltr
(d) For thb asset and otrer eosot8 irflilalled under the Conrmlesion-approrred
fadllfies clrarue piln[gbns, the Conrpany has fully rcmrrusd the coet of a depruirated
EAI{O FOI,YER @IiPAIWS RE$FOIITIE TO THE SEVENff REOI.ESTS
FOR PRODUCTIOJ{ OFTHE INDUSIRIAI CUSTOTIERS OF IDAHO POWER.6 ErhibltNo.304
il,c-n-rroo
Rcadiqg;ICIP
Prge 24
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OROFFER INTO EVIDENCE.
Exhibit 8-B
Prge 43
pteoe of eqdpttlpnt lf and ryhen it pacftm lb assumed 3t-year depuclalb llfe, ag
dc!{rlbsd gn page 38 of Scot Spado testlmony and fie hrrpan/e:lesponees to
lGlPs R€quost Nog. 5, 21, zl2,ard 23. lf a plece of equlpment Is ln$elled and used
anrl usfrrl beyond 3l lnere, the Company orilntps,b pruvlde rarlily arralhbb utifity
gradg eqlsrnent lnrrnbrles, holi, Egrporiler, ngsponse ganio€q and eledr&at
fnovrbAge and.enpedanoe for kaeplrU tttat pl€ce of eqdprnont ln operaffon. ln
addltor.r, the Company dlsagmes wtth fir6 characterkEtlon trst lt haE'orcr.noneied'
as lhe Company drageg and oollecilr'wtrat tus been auhorted bythe Cornmisgbn.
The ruspone b frls Reque* rrras pcparcd by Scdt D. Spailcs, Sanior
Regulabry Analyrt, ldaho Power Cornpany, ln oongulEtlon wr'th Jamn ts. WIlhnE,
CoDoraila @unrd, Hem Pousr- Compsry.
IOAHO PIOWER @IIIPANTS RESPONSE TO TTIE SEVENIH REOUESTB
FOR PRI'DIETICIN OF THE INDUYTHAL GI.ITITOi'ERI$ OF IDAfiIO POYVER - 7
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
ErhIbttNo3M
IFC-E-Ir-it
Rerdlng trCIP
Page 25
Page 44
frFOtlEgT FOR PROPUF,I|OII 4ftQr Rsfercnos the Companfs Reoponse
to lClP Reqrcd No. {(c), datlng that all @ds for frdll[es lnsHled bcyond the polnt of
delhrcry are lndudad h ths ascodebd q.&trpr c{asoos' rciprrue Equlrumant, and
wtren tlr fiaclilllec drarye rsvenue h appfied as a crcdlt or oftct, the a8sodat€d
qrstomer ohssss! Fwnue ruquEment b ruduoed.
(a) Whm ttu Conpany Indnrles fie@dsfrr dEtulbution hdlffiee boyold th€
polnt of delhrery ln tre rewnue nquipnrefi doea tre Conpany lre a depmciabn
schedule a lt musil, fur dBtibuton Edlltles on thc Companfc sUc of the meten
lnch^d€d ln 0ts r$rqrrp rqrironrnP Please explaln how depreclatlon Is conellarcd
vthsn ffis beyond the polntof d$rcry ara lnduded ln tlre rcwnue requlrenrertpdor
b ttre pojnt thqt lhe Compeny cndlte faollltlos ,*rqlge rcwnue back to the arsfrner
dase's E\rcnuo rcqrdnment
(b) lf tB arpunt of fis nmnue requlrcnrent decrtases onen dme b scount
br deprc{atbn, hrl lhe pfudpel amount of $s facilfrlee drarge to th€ lndMdual
custqnor does not decrpase ougr tme, pleaee exphin trorr ttre lndiyiftral farJlltles
cfiatgEqrsbmer F nd$bcldizirg the ]g$of 0rsqlsbmerda8s.
'(c) lf the.arrcr,mt oI the nenua rcqulrelrurt G not deqease orpr tlme b
amrnt br deprdaUon of dkillllrrfbn fdih beyond tro polnt of delivery, pleape
erqlaln hflthe Company b ndovsr-rcconrlrg br&prcciebd a1ats.
RESPOTTISE TO REAUEST FOR PROUGIf,II{ ilO. s0:
(a) Yee. When dfrnnlning rerrsnue r€quiremgnts hr bage rstas, the
Compeny do€s rd klentiry ald bEat soperdely facilities indalbtt beyord the
Gompat/s pohft of delhrery. That is, lhe Company usea the rame dcptsolsflon
IOAHO POUI,ER COT,P.A}IYS RESPOME IU THE SEI/EIIIfH RECIUESTS
FOR PRODlJC:TlOil OF THE II\DUSTRIAI CUt]TOllERtt OF IOAHO'POn ER - I ErhlbltNo.304
rPc-E-ll-0t
Reedlng, ICIP
Pege 26
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 45
metho&logy br all dlstlbutbn iadf,teg whfi Oebm*dng ns t€d year IsEx.n
rcquirernent
(b) Becauee the fiaclltle draqe cdhllatlon ls bns6d on a lewltsed tuvsnuc
dsEmlnstlon mdrod ard bce lates are detemlned uslng a eingte test pedod metrod;
hole nill alunyo be dlftmrrces ln ltre wrnrat rewil.p tsquluinonh dobrmlnad udor
each metrod.' Tiplo tffiig dffiererrer or'subsElee' gp ln ellher dlmcflon 6r lnrtlvldual
cn$mers depondftU on the avemgo Ue of lhe lbdlilee sttled to fire facf,i$ae c*raEe.
For exarnple, a ousfoms rvih neuor hdlttles uuill pay less in fadlfile chargeo than thc
acfrral emral rE\lerp lgqfi{BoErtf wft Up tgct of Up o.tebrn€r dass payhg tho
dlfbrqroc thmudr thef baso rds. The oppodE il tue frr cn^Sorrrs un$r stOer
hdtltes nilu pey more ln mffies cfiarges than he singbyeer rcwmre requllemont
vrculd st4grest
(c) The anpunt of tsvenuc nrquksrent debrmined ln a test year for a
crsbmot dase thet ir srebb fut hd[0es chargaa decrcoes orslime b ec@uril br
dapreddon of dhfibuton lUfitiea lnsfia|led boyond ho polnt of dollvsry. All turerue
noelWtl fum ftcilteg durgn cuebmgs ls crEdlbd becfi to the msodahd custorns
class leavlrp no chancg brovur<uorery
The lesporao b frb Recrrst w prepard under lhe ffrectlon of Scott D.
SpailG, Senior Regdabfy fuialyd, Eem PqflEr Compny, in quultetion vulth Jason
B. Wilhilrg, Coryorab Counsel, ldaho fuwer Company.
IDAHO FO,UER CC[rrPAt{YS REIIFONiE TO IHE SEVEiIH REOUESTS
FOR PROEUCTION OF THE INDTFIRTAL CUSToi'ERS OF IDA}IO FCIWER. tO hhlbitNo.3ll4
tPc-E-l1-0s
Rerdtn3ICIP
Plgetl
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
,l
REOUEST FOB.PRODUCilOII 1().71: ReErcnce he Compan/s Reoponse
b lOlP Rsquest l,lo. 68(c), SatrU that the Corrpany reoovers €sb assoddsd trdth
unlnqmd amountg llleFd to falled frdllte8 drarue equlpment by booldng llrrc costs
as GDeonSor and lndudm them ln crrdomer rates. ln llgIfi of thb rstpoRse. ptcaee
explain lhe b* fur not allowitp br the ffitleo cherge equlpnpnt's lnlthl value b
droruosc owr tme as the Pieo of egulpment depr€clatss, Pleaoe eoehin wtry the
Gompalry lndudes rteprucEtbn as a poomp oomponont b he ftclfites @rge that wlll
increso the amouiltta onbmer paye, mtterfian rtscnaee it
REsFot{SE TO REOUEstr FOR PRODlfGflgf{,,U0. 7l: The ffities cftarge
nb cdcdat'ron is bard upon e 3f-yeardcpruclatbn sctredUe which b reiedett in the
ratum and dapuclatlon oomponenb of tlre mte.
Deprealatqr ie a poollrp conporrent of ho fulltie ctraBe because it rellects
rt in fi6 anstornerder itthe Gonpaqla recovary of ltr lnvedment in fie arstomerdedbat€d Hlltles trat
lnstath, ownq opemb, and malnblne rrJnhout lncrcatho the rabs of qntlnene ln tre
asocEbd cueilomer chss. The monfiU fadlltlcc ctraryo F d€slg[Fd b rcmrer all
o$s assochbd r,r,ilr @ddmerd€dicsted frdlitl€o irtltsll€d be!/ond [re Oompanfs
polntof d€firrorytrrough a lewltsEd oet<acovery apprcach.
The reoponse to thb Ro4oqt ws pr€percd by Scofr D. Spailc, Senhr
Rerylatory Analytt ldaho Fouror Grirrnpwrq, h coleutffilon wffit .lamn B. Wllams.
Corporab Couwl, ldatrc Poupr Connsry.
lDAlto pcni,ER coiilPAt{Ys REsProirsE To IHE SE\rEt{fH REQUESTS
FOR PRODI..ETIo1{ OF IHE hIDTIOTRIAL CT'STOUERS OF IDAHO PO'VER. 12 ErilbitNo-304
rPc-E-ll{t
Readlng' ICP
Pege 28
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 47
BEFOBE THE
IDAHO PI'BLIC UTILITIES COMhIISSION
cAsE NO. TPC-E-11,08
NIIUSTRIAL CUST0MERS OT II}AEO POWER
READING, DI
IESTIMONY
EXEIBIT NO.3IN'
Idato Powerrs Rerponses to Production Request Nos. l{, 15, 16, lt,
53, 58, 7O and 73 Regarding the trnsurance and Early Failure of
Fecilitier Charge Equipment
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Pege 48
RE4UESI. Fg.n PRODUCngil ilo. ft: R6rsnce DirEct leetmonV of Soott
Spafis, p. 30, [neo 1$20. tbos tho lnanane canled by [t6 Gonpany oow or
lndanrnlfi cuslomur fuin aoddent or krlury ascodattd wilh @nrpany- owned ftdltles
lrffill€d beyod lhe Compert:/s Point of t elfi,ery? lf not doo he Corryany mal<e nsw
qnlom€tp awem of the cushmofr hck oI cowmge or lndsmnlf,aatbn fortdaho Poflpr
oqupmeil on lhelr propelV?
BIESPOIISE IO REOIIEST FOB PFOPIFTbI{ tlO. l{: For Oompany-orured
HIH6 ln$elld bcyord Up CflEanfe poertof deliuery, tre ln$rat cantcd by ttre
Comparry rmuH oovsr a!ry loer lbr whlcft the Company wat deqned negligent h en
acci(bnt or lnlrry.
Thc raspon$ b thh Requc* vuae prepared by.Ttm Tuclor, Pnoperty arrd
Csrnty Admin@r, ldaho Porer Company, at llte dir$ion of Soott D. Spado,
Senbr Regutdory Amtst, ldaho Founr Company, in comulhtlon Wlth Jason B.
Willhms, Corporab Ooulpl, Eatp Poner Conrpeny.
DAI{O FOIVffi @tup lrlt'.S REBPOI{8E T0 THE S@ttlD REqJESTS
FOR PRODUSNO{ OF T}IE INDUSTRIAI CUSTOi'ERS OF IT'.AI{O FOi'ER.15 ErhlbltNo.305
IPC-E-I1{S
Rcadlng ICIP
Page 1
Page 49J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFTCIAL NOTICE AND/OR OFFER INTO EVIDENCE.
f,xhibit 8-B
REAUES|'I FOR PFODLlCTlOll t{O. !!: Rslqmnoo Dlr€ct Tetinrony of Sod
Spailtc, p. 39, llna 1&19 (etatlng the pollcy ooyarB o$Xpmcnt u$loci b tho fadllths
cfraryn fur'pnperty, casuafi, ad rrcilon conrp*rsaflbn'). Please Wlaln vrH
'popertf lc oownd and in u,lut ftrhion Plaase edah why ldaho Porer bellev€a
REsPOrlsE Io iEolJFsT FgB PBoPlJGIlS.l ilo,l+ Ilrc popsty ovqud
b the e1{pment on 0p effinp/s hclll[os draryB and tp taul8m.eryooure meted
U ldatro Power orntry, opoia0ng, and malntrlnlng thlc eqJpmilt, whlch can meult ln
propoty. fldrd.pary hbilfir, ard uorlop' oompqrsaton losres. ldaho Forefe prope$
lmunnoe poticy oovEm "pteprtt/ darnage tfiat reu[c tom an Innurtd aont htr do6
nd covrr Tadllty rqlmnrent costi' fficHed wlth norrial rrpar and Ear.
Addltlomlty, vfrlually etl lnsumd" property lotsas.omrniru beyono the Conrpanfs pokrt
of ddinerymrH fillundorldaho Pore/s mff.iruund teiedhn (dedudiHe) ard rculd
be an upens incuned dir€cty Wthe Comealry.
The moponse to thlq Request waa prepamd by Tlm Tudcr,,Pmpsrly and
CaorJalty Addnidrfrr; ldato Furar Compary, at the dincilon of Sott D. 9parls,
Senior Reguhbry Analld, Eaho Fflsr Company. h conrdE[on urttr Jaeon B.
Wtliarm, Comorab Cqrneol, ldalr hrsr Company.
lDAr'{O FO,lrER Gol',PANYg RESPOI{8E lOT}lE SECOND REOUEST9
FOR PRODI.,G:flON OF ITE INDI.iSTRIAI CUSIOIGR8 OF IDA}{o PO'UER - IO
)
'r/i
ErhibltNo.305
rPc-E-l1-{t8
Rerding ICIP
Page 2
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
[,xhibit 8-B
Page 50
t,)
REOIIEST FOR PRODIEIIOI{ tlo, l0: Rffirne Dllmt TssiltnorU of Smffi
Speilc, p. 39, finee 1$20. Pbae pvkh a copy of the o.rttilU ry hsuran@
poll(|es) rufrrEncad, md idsffiry the pmvfslons that apply b equlpmont otlrNsd b Ote
frdlltlo chaqe.
RESOilSEIO REOIE$T FOR.PmUGflOil llo lG Pbaee se tre
athdred qrmmarbs d lmuram prcgrems errgrW Fr pfiaca. fccfnfcaUy, 0tere arc no
pmvlelons frrqt rs6r dlrlcilly'b eqrhmcnt *rbjeofi b tre lhcfrtles draqe' a8 ldaho
Pomnde lneumnoa $rffim h a hrgc 'blankef pngrem fiafi trould cowr oatrtmphlc
lorlsc ascodded ufilr trltd+afiy lhilllty, propcrty, and milro:'Gompensaton beceg
that oouU occur at or nsar the Edltba and equhm€nt ln quedon. Mod lo$s8 fiat
upuld oocurrrltr facfiHes drarge qposure rrould fall underdducfrble levrls and rrould
be paU dlncflyby ldeho Forrcrrruilurtanylnsuure rtoolicry.
The rceponee b thb- Rqmt wEB pmporcd by Tlm t**- Pmperty and
Casualty Admhislrabr, ldaho Fower Company, at the dimcfion ol Scott D. Spafta,
Sedor Reguhfury Anelys[ ldaho Fonsr Company, ln omulh[hn wltr Jason 'B.
W[[arili, Co]porab Courpl, Eatp Porrer Comparry.
ItrATlo FOU'ER OOIIPANTS RESFONEE TQ THE SECOND REOUESTE
FC'R PRODI.ISNON OF THE NDUSITRIAL CIJSTOUERS OF DAI{O POWER - I7 Erhlbit No,305
rPc-E-lr48
ReadlngICIP
Page 3
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 5l
Properfi "All Rlelf Prcgnrm inoNudhXg Bolbr & tachlnery
llmrd hrurd: IOA@RP end any erbcidLy, .nd IDA@RPI iribc.t in .nypartrnlilp orlolrt wrttrtu ln nhhh DACORP hes mmagamont ontnl c ownsrchlp eg
now ondtubd or hordlr b aqdnd, er the m4ecdt o lnEset of cach my eppeer.
IelllrUAdfiur: P.O. Box 70
Bobc, !D E8707
Crnlr: FB6ryMutd lnslmn6 CompqryFolicyflJt 1415
Pof,cy Tcm: May 1, 2010b lilay 1, 2011
ForIr: A! Rlskg ol &€d physhal lw or d.rqr indudl4g thc perila d ealthqwkc
and fieod, hdndtrg boller and tmohlury, andt dlidB pltydcal thpfs.
PoIcU Fmrr: PusrGencnatlon GE U2mB
LknlbofLlrblflff 0 2,0(X),0m,0m PoficyLfnft
tubllnrltr d llrblllty: Ttte.Ocrnpany udU'pau up b fte :fdlowlng albflrulie of llabllry ln
any on9 oocurnn60. llhage rubllmf$ ao parlof, and do not serug b lnouaae, tftc lltilte
ot tlablllty etixlc a Urc aggmgar fimlh of lhbffi telor:
$ 200,m,q0 AmualaggltgffiEailrryda$ 200,0U1,000 AnnualqgrogabFbod$ 200,000,000 Anrualaggragab Dams end Dkeo$ a000,000,0(X) AnnudaggrBgabTRh$ 2,0(I),0(X1,000 Dmolliot,lncmescdCoctofconfruc{im$ 100,000,000 AuEmdcCovenee(g0dafrBpottngmqulnd)-Ercludc
EISrFbodS {00,000.000 Valuabb Prycrs and RacordsS 1(n000,0(l0 AeunbRaaluable$ 10:000,000 Oala, Prograns or Soltrran and Conputar $&ne - ttlon
Ph.yilcEl Damgoorth€d0 100,(X10,(E0 Emr&OmlsslonE$ lq.m0,S0 Mbe[nsrdUnnsnedLocatbrs-ErcludcEll0 10,0m,000 BtdgrcandTtltnebS 10,000,000 Pmbcffon ild Pleeawaton of Pnoparty - IIme Elemsnt -
EdurlloTcnorlrm$ 10.000,1m Dcbds Rctnowl$ 10,000,m0 Deoontarnm0on Gct$ 20,000,000 Expedthg Expenae and Edra Epenee$ 50,00t1 t snd and Wabr Conhmlnant Clmpp, Remowl and Dlqooal
$ r0,O09,mO Benbllnsrarc$ f0,m0-.000 Serulealntamrpthn - t{on-Generatlon lmtiono only -
Bclud.r Eni 100,000,000 Flnetutt
025000 + E0%dlres PrcfasslonalFees
lncluded ln Dofnilon of PloeeIV Gource of Conatruction$ 10,m0,000 SofiGoetS f0,000,(Xl0 TranoporEtlon
.SEEATTACI{EU Erhlbtt No.305
IPC-E-rr.ot
Readlng ICIP
Page,f
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Erhibit 8-B
Page 52
Drduodblcr: S 1,m0,000 GomUnsdallcowrqeblncftrdlngCTb,ercspt
L'o'* '* ffiolt loeauons 2233 24'25'*,fi'3.33' 34 and 4l
0 100,000 Cotttepd e[ ovurage's tnoHlo equhtnattucHdl
flrysicaldanagc
cX ivlrn WOO,ofo Mtn PD & TE wlrd cowIagp ln CommonuoEtrr ot Prnrto Rho
and lst Ttrer tl/hd Criunter
0%u,ffi 1500,000 Mln
PD & TE Wrd covarago h 2td Tlct Wktd GountheS 50.000 Tmcporffion
2 tlay/$5U1,@ Mh. CornpubtSllserne - Nqt phyalcal thruge
l% rldti llOOi0llo Min Tcmrism
Rr#acemontut, oreptm Tranfrnrnrtzsyutt osddat. otheyo nd
Yrlurton: been ompleEly nrrmd wUrln he pd 25 yeot md m$lle equhmsnt,
ACt
gO+y nofice of canoellatloq l0 days frr norrpeyment of prmlum
E:duebm:' Bu$w lttbmpdon
'l$dear' irlmr Turffites lffitefsd or Ao+rhd {bn lncrytm
' Sffilng, craddng, affidrp, bulglng or apardon d damo and dlk6s.
Spcdd Gond[ron] " E tE Eeense Cou4e rbas not apply b trs pn*rao ol
' ltplesncntpourr
" ') ' Edm Elgeme Corcrage doec not app[ b lo* from porrer/ensryy tradfig or brckrlng
aciluitigs
'Dafinlton of Occunurce 72 tloua for Wnrt, Ffmd, Eattrqualo
' vlidbn i,lodoe ol land/tlhhr Corileffmm loss Requlred in f S0 Deye
ntlc fum;rrry d brlttttrx. b lw gtr rdlaurr' W, Pltxr$ rGtrr b yow ptirllca
lw add/ftrni *T" q"rililrt rzd erctrhm llpa ltpy Wt1
To[.! hnrrrtle Veftn:Tolrl irsurrDlq Veluc: $ 4,986,21?,000
$ 1,E07,(X)0 Awntrrlfiantunt
Pruiilum: $ Zli0;fl10 Tcnallilinftcrrlilwt
lnchded E@tcrr*tgtu
ilons ftecE Taraa
TfrlAnnudPrrrfikrm: I 2,12t,@0
ntbrr$00):0.G18
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12. Andcd Ptdu Notioo kdrsion &rdmcnt (lfisruqEtt). ruorns GP[, cloro, u
pa aqirhg Etrdmcuttrt I{o. 12;
t3. Publis OfrrhgEaduremnnt (Fom 6630 tXXfD - Cl8fr$ oowmgp lmlldr Soction
I I & 12 of tlp Saritirr Ac of 1933, ar pa aqirhg Bnitorreff i{o. 13.
14. Amded Ddaidoa of C|einEndoreoumt (tttoo*lpFrcndr dofinitrron ofChin
o povidc oorrum6o fqrWcllsNoticC, upcr opffqg Eo&rrcmatNo. l{
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6 bc cErilffi wilh ltc @drgacitdoq ar pcr qfolng BudotmtrtNo. l5A
16. Non-Cmcctlgtim Buhmom-Mmusorf.t-Polioy ig um+uceltrHo by imr;n:r
GrccPt br rm{8p€nr of pralul rud G} cucclhblc by tta innrcd m a Dio.toubds * rly tiilG-R?htcs onpidry EdorimcmNo. 16
t7. Aad Erchutur (EXO Gorm 66t4) - rhlcus excludm F{6).psil&turg to qiw
cfuhgsuqfpLagy, phsirirn, 6.- ac pcrqfuing EndoncoagNo. 17l8 Anoodcd Ac4r&itioc lrikSF and Dbolrlioa Bndurcaent @07o C.rwrftlirdiol
Ha:mfsarh FilLryAE0IS
!oliq,:
Eodmmt (Fqo6!t3 ltil0(}7). rr
EodonanrNo. 18
20. turodrul.ffio rdI?JPRAof 200r, Bdrrcnm [Forn 6639 IZOE]: AEOIII
mrcb ofto o pruutdc eo rborr'un:d rplior* inaraco covargn frr rn lianrrtd
lorri runtdag fioo m 'd of Euiro," cd rr dcfid by thc Tcrodm Rilk
hurcg Am. rr mdd (6c Edcqd AEfL m &c aano unr rod in tb rrm
aonu8 c bo carcd by ofrcr cr6 oortmd by you polioy. (Eac,h of thcc boldod
Er irdeGdb ec fcdal Ae rh dcftitmr oiurol ou glutt ofcorcnge
tndc prr poligrf. Pbrrc lad 6b oftr orfilly.
o Poliq' Folhhg Fotn kon tthtctrr e Ofisr Indcmity Policy Fom Rcv. 0l/0 l/0( er crptingr iU tr&tcpcrsFolicyPcub b&grucualupctrc cilDbilgE6rrtilicptuiuaotodebovs, inchdiogttobolowsotEult.1. Prio &Pcndiry tfffrtlmrr pcrqlfigBodomncutNo. 52. Noor&noohbbccdel{m:Prfm.d<r pcr@riq Erdmonmt}{o. I3. Tcrruirr-CcdficdAcrar p:rrirpluingEndomcntNo. 6o Conqrge frr'AotsofTmrbo"as&naratr.teTcnodmRirklurmrcc A0lqf20m, ilchditrg rubcgquoatrotr of
Cogcrr eurnrat to Ac*, ic i!dtd.(t in your crgiriag polic;y. You rloutd loow rttat, €ftcdyc Novenbcr 26 2(X)2,
rudcr for ail$g orrcngt, ry [olcr cauroa Uy Certiica Acts of tcnqlro could tc pu&rny rtinburcd by thc
Udbd.Strerud*rftrutlrcdblbtEd.byftdadhw. Itcaddltloulmulprouiumtoprrovidcwmlcovcrrgp
hr acts of Cmdm lr $10"510 *lriclt B hofidod ln dr pnminn nrbd rbova Ym may elact b haw owc,tlgc
qc,ln&d ftr lo*r .ai!fog ftom uu ofiisnirlm ln rrtraiho with tho Tcrmrim Diek Insuam Act of 2CI2 aad
r$acqucnt dcodonr., Atfiahcd b a lcttsr c,tich.,,ou arg rwicd o dgE 6f,&cr amt?tiog or rcjooti4 fu covcmgo ,ftr
'Aorr of Tqmrisf ({.ciEil !frrohod). llrc dccfoimto ry@ oirqiGt "Acr ofTenorird cowrlgc mut bG nrdc
tyApdl2l,20l0r4. Policior Follsupri.Pqr.lmdng i! Gryirhg EndonmrNo. 4-o BIM rrill rgoo to bllos trn lnoB'a QnE lm dod AFil q 2010 imluding only cndorromt mdus: l, 2
(rrocptpu$ryh6}3.d5, q7,E(cxc+tpsnff+h09, 10, ll, [2, 13, 14, 15, 16, l? & 18.r EMriltndsllo*codorscmnnblr* 19& 20.r Yifr rcqoct oudadyiry a$ lirnitl BIM only S[ou,s ftrD b t€ cffi it tfrlcts 0ro BIM dbr]et poitrt.5. AucndDsfrdouof Cldn-rrpacpLhgBndumtNo. 26. AomdNd€ofChin-u paagirtugEndonomcorldo. ?
7 . llrrhd of nrymatl' Sido A - o pcr qirhg lu&rrcocat No, 7E. EEvo qrcd b ftlbw lLe AE(f,tl 20t6 loqrdlidon thrhold & l2 Eodh look brd( ftr dctuition of qptioa'don (rrcd
rocn&d HM quo cooftdag ltir) RcocirrEd
r ldetoCmilrllniooftrlb aymnofhcoimo lffityfildBw@RdrituraiatHdoriinsat(l25l$Ud0. Addidotof0dorofPryratso Amtd$cru$fffyofBrchuiuo ArsrdDcfinitkn.oflouudFrud ndDaronalPmfithduim fuseedm 15 Glaineo Hqrto R{cttf,rts, Chie,orPotmlidCtim bTtsrcErro IrycbtNdiEonaecads4lgpdudBdcco,aotrtimr TcgulmPolicyDircloorrNodcc-TmuirmRi*IlcurmcGActdAxDo t'rp mloura Fror Cor{ifiodActr of Tocrubn
AEGIS: Noos
EMl. pryyofudcrlyingbidcr
2. PlldtlnDol'Eml tuo byinccptin (4ilnilO)
Trltnlc:
l. Undglyiugpolicybindcrr
'SEE ATTACIIEII'
Erhlblt No.305
rPc-E-lr-08
ReadiugICIP
Page l8
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
a
a
CrhnlrBnrrtr
'718.
Fhuanr, ilirFto.
toAr{dGAAmorz
Plrom: @r$6!S2!90
Fu:(ztglETt888
Ibh: tueurl1?,2(l10
Fun: t(frRouker
Toi SbYcMmrlh
Companf t{ARgH AVIATIONFuNmbq progrenwdCHARTIS
INSURAI{CE BIITIDER
lrco Corqgra m tond prrh Errr, @ndbn . eld clbunrird orquob d 0$2110
Nm.dr[nd: lrhlio fuufroompenyAnd ld|ooD, lna
Addrta
ndhy*
FotoyPolodl
cairrrrA:GtrlrE:
Oqlrog.G:
ccurr..eocurrte.E
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corArGGomfrtftCcilt c
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Oguilg.X:
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P.O.Bc70B*.,|D 09?07fl0Cl8d7a0 ammdolplsV GMOt@?rSffieuCdtcatt-tdt rt l}il fi ffid trG d6.ffi drowl.torG3 $0.40$0 ErfiOc{hutoI S.a0nohfioanup lldaumsc aCRrgct6OraFubd 0 OEhFt 10,011C0 Erdtoocurm
Rreclhe GrorRdod: a quDyt
l0llO.f EechocorrrplO.m0XOEroltoc.lrtrEt0ruAirf fb2tlqm Er$firnlt-ArE24fqmE{thOcerrE
Dldnclib,,0,mE.!iOlq,tIlElnD.lilEr0anrno
t0f,0.000 ErhOcsruro4mO[0fhoftndtelrfiIQmoEdroruruHnctih2tl0ErhrrfOflOaotmrmo (8crrcdr.ilcd:EerhNonc,lllt mbdlm.IDE ohhrlE (&ffid.d!E,lrorwM.tiltt}O,00E*ttOoccnp $Ufonn:Edrih0lqrlrirt rfL.S0Edrorrrm (t&ltmp.:ErCrOurllmbcll$i'[0 Tobl ]lanormd Ahcrdfrf,EilhIga
ioaGotsqrfir.$,te
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t0.lC0 EdrF.mn (Ptrmk)5!0,6eEdtOcaruto (Pombtsl
1BEEATTACHED
3tII
0It
a
3
3t
3I
Elf,lblrNo305
rfc-E-t1.r)8
Rerdlng ICIP
Pege 19
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
tFtWllmtil&fnrcf lf,UiSrrrAictdt
llrn d F{o!l [.lv Jdilc,lrr]o& Jlt PlIa fi
Av rr,f nn cr rsrid t' frr tnt rriif
rlilltldi,
IldcoeE* h.fxhltirDcllI.
W.rllrlEnsarw-gs,
W.rlJrD[Iu[t2rnr-$aaq
Itftillzll*lU-to.Uffiy-$S.
truilnrcornnrLelo|i 0.0ffilrdf Cufnf if0onrl lfi.on Fir! tilnta.OotrFrfof ruuO.PAFtotFcn:qD{aEriir.lrnl:
llExwrlfte! UEr0t Fo0emH...lt5&qt EzomhR.Eon[ilerCon Olglta tE2OrA D0trhr l"ffi Oolqp'O.r'E t ElgZ lta lt{, t EttB Tth'tilU, CtD{28 W.f HU lffi. 8Dc.l[o wtirlldI GLD&lEW.rth*ry(fr8r!frrtrrcrtsltld),OLD0tt.ln*,.ltrdlldhetfrhpocthrlJr!trtyrmtt eI6t - Otilr R.ffi tliGy, GLD03{. }ttaffii ol ftglnno md F*nD b F.poG .,, .,,Afpl$ fr., frru,hda,aloffil fuumrt n Ia ilfrE lJEt66Tfiulil EEtdm. Odfrd
I UEIIB ilntuB**n W$.dbulrr r$ihd), tEaa8 re Erdulon, UBISBWr Erlrbn ($rioUEilaAlmrBdalcr
l50J0r
ttWbLrdlnr r0 wlrrr.r rlt lI]! o 6ra.It.ril.ndcy(cOolcbrlluq$Nffittolrnd'qm rrbtldn*ltDlur0h*.nlf fF h.rrruhlh.irird.nrlEt*I6ybmot thllrdtlr Dlt f.!r9olryhlrllit.tllddl[lEl ufi€lh.DntEbllrtrlor* Ih.qE UlhLdtrdbylretdnurllrori.tolndBR{rl5ollGc)nmnu ollhffi filorlh.lordldA fFf mt ToLhurltmaibtlthad.rty.g9L.U.rmmb.runl*d
lilA6rr{.lrb.n fEfrt . .earFr[hattrclcr.
Tolat AnnualPrrnilum:
trrlrmcrotrhdn.,oxlrllti;
Gimrrie
.SEEATTACHEU
EilibitNo.305
rPc-E-lr{r
Rcadlng ICIP
Page 20
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
+ AEGIS'
InrunnoSrndoec
BINDER
Junr 20, 2011
I{AII|EDINSURED:
ADDRESS:
Woohrn lilsrrxneded Bod& 8!+ilr. 0rVlES)cblhtrhIJSAlrc.lll Soffiwtcdumbta
Sultc 500
tur0and,OR97Zlt
Re:. Erasc LlaDilfr .lnerencc
C[.lllil$trlRST{IADE Poffcy
Assodabd Eloctla & Gal ftnrnna SgvB Llnft.d hgtbyaorti b plovideoveftgF ulder Poflcy
No.
X067AAlA1t lbrtheFOLICYPER|ODfiomho{stdayof Junc,20fl unillthe lddayOf June,20la
bdr
dap st l2:(X A.M., $an&rd TtnB, atthe addras of Ote l,lAllED INSURED.
1) nunrmUts,osa
Tenrdemt3TEaS
Gommh*mf4O,000
Folby PrcmlumS498,0m
z',)
3)' \ RETROAGINE DATE: The lst day of Jma. ISB al lafi A.M. Slandad Tms atthe addrcpo of. / theNAItlEO INSI,JRED.A.
8.c.
D.E
F.
G.
LIMITOF LIABLTTY EAGH OCCURRENCE:
t. t0,000,00tr2 $1 8,oflI,fiIo GENERAI AGGBEGATE
JOINT I/ENTURE LNTT OF LIABILTTV:
Fu Lhlt d UablHy $cfiorr l.(Bxgf
@i/BINED PROEUCIS LhBHTY Af.lt COiTPLEIED OPERATrcNS LIABLTY
AGGRECATE
UMIT OF UABILITY FORTHE POLrcY PERIOD:
$g,ooo,oos
FAILURETO SUPPLY LIABILXTY AGGREGATE LIMIT OF LIABILITY FOR THE POUCY
PERlOU
s9,oo0,m0-
POLLUTPN LIABI-ITYAGOREGATE LIMIT OF LIABLTTY K)RTHE POLICY PERIOD:
tBD,(Xto,(xlo
t EDICAL MATPRACTICE lNtlURY LIMITOF LlABltlTY EACII OCCURENCE:
lg,0tto.qxF
WIIJ' FIRE LIABILITY AGGREGATE UM]T OF LhBLTTY FOR THE POLIGY PERIOT}
09,lxx),000 !. SU&IrcT TO THE $18,OOO,OOO GENERAL AGGREGATE OF TI{E POLICY
4) E(CIUSIONS: As perAEGlS POLlCYturm.
.SEEATTACI{E'
Erblblr No.305
rBc.E-I14t
Reading ICIP
Page2l
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit E-B
I llradorlndr Plu Ed,Rrdrabd, ru Om?:l Td@m 2Ol 5fitilo Fdnllc zfi geta8e
AEGIS .nd hc AEOIS togD rc mehrd 8a&c llrb dAl&d Ecct& & bt lmurp So&r Lhbtl
E()ooBrNr)lt (0rf20rr)
BTNDER
5) uxoeruuNG uMtrs:
A. Soo Undcdylng Llmls Sdtedub.
B. if .0@,000 ary onr oeurrun notcot u'd by udulylt! fi:uencr.
C. ln the srmt d iny O.AIM (c) alHry lbon any slngb O@URRENG:E uilridr ltlohn(s) two or
mor€ UNDEEYING LMITS, the UNDERI-YINGI LIMITS ohal apply ln Gomb[naton.
6)Endonemenu
The ftIontrg ondqrcmeilc sdlbr crctdor tflff tbo bo ttldLd b he pdlcy.
l. i,lr$bar EnrEy USmy Ercfitglolr (Btmd Futtt]. Fmn ]lo. l(DE8202 (1188)
2. Enpffi ffi U-my Endolqnrtt, Fmn llo f 00€8402 (3rl f )
8. Empbpnent Praofa U$flry Erdrbn, Forn ]tb. 190{8ABA G,(E)rl. Arilonrdle Lhblll$ Exr*don, Fmn lrlo. tlIl.ESAf (1m)
6. Dpinfion (S] lqmCabry Erlaaaneffi.Fqm No. l0Gii0ml (10/fi]) ae per oxpHqg EndL No.
5
6. Socfion n Oetrmionc Snfrsdlr t Fom ],1o. lqH,t0ml (mOO)
7. Fdurs b g+ply Exdsm Ammdauy frmernent, Fonn No, 10GM0001 (lore) as p€r
wfrluEndt.nb.T
8. Addltord E:rGfIC0n EndOpqnent Forn tfo. 1Gil000l (1000)
0. Condllflon (P] ftdorusnor[, Form No. tOGM0Ull (10100] as pcr arqlrlng Endt. No. I
10. tldlrltlon (t) Endonattcnt, Fom ib. lO$Uqpf (f000) ac porspldng Endt ilo; l0Bll. Srattd Llmils En&r$mfit Form tlo. 1OGll000t (IUXD
12. Llnrlffionof USllty Endonsncr[ Fonn ],1o. IOSM0CXI{ (ffi00)
19. tblnbr ldBt vOtE milr enOoncttrent Fqm No. i0GE8{P (1ff17)
14. Tcrrcfimn Lhib srd TRIPRA dUXf, Bdusemqil. Fonn lfo. t(XlE0400 (Ulf )
7) Mmberattp anl Vdnq $atm:
nilE PIOUGY rryl[ grtlc trc I{AMED INSI REL b be a mgnber h &o @MPAt$f uilaes fiat
momb.tstlp lr lupemEdsdr st any pdffi h tme, by r peilrt or amEbd 6mpany, wfrlch ls abo a
mqnbsr lnthe 0OMPAII|Y.
Tth POUCY rt O dlo en00o the M,ilED lllSlJRED b a vtr or any m&r suhnfilcd b the
msnben of the @tlPAI$f unlae fimvmg dght ls armrrodad, d any pofirt h Umq by he rdng
rlght of a parut or fiIded company.
SlTerprkn Govsage:
TRIPRA of 2007 (U.S. l.ocdonr Only)
Terurlsm RlCt lriurance Hugram ntoiltorumon ld.d.zol? fiRIPRA) M.ndr the ptogram lbr
loum yuars. lt dlnhd€8 trt dbtnoflon bduoot lbo[n od rhneotc acb d brruhm yuhle
malntalnlng thccunrnthdenl*lero(05't5)am the lnrunro4ay(fSFr6)Sorctho lnsuu'e nlentlon.
Ithadenethccapondllnerlrt'agg[lom[abfrtyttllotrillhn Curunty,ldoeenotnquhc
lnertu! b oilerousnegpfornudeer. bhlogb4 cft$rlcatand tedologtad llsb ([{BCR). ln addlfion,
tm bU mehtElns lhe curuil prog*am t[gcrd 0'100 mlllton and thc mandebry rlcor.pment laycr of
$27.5 bll[on fu fuderd peymanB rpe$tU ncoqrnsdthdanes. Tho Aci t€qrtuEs that 133!6 tf
Ite&nl outlaya be lpovorcd ftloug[r ffirdrt* rurh.ruc. Fhally. it provitles brsaoral etdtes of
insunrp ewltabiltyffi.Ufity lbr NBCR rlshB and lbr bnorlem markct capecty. AEGIS wlll
aorilXrp b ppvlde Enubm mnrage lbrthc pdffiroHc as il hes sku thB qlshal Hll was snacbd
Pago2dS
BINDER
ln 2002, FurUrcr rS lhail alry bnotlsm Got orap pmv6ed under tro AEOIS E cess tiability Po[cy ls
$IoFIt b filo $18.0fl1i0s 6qp6 lggngale of he FotlcY.
Atradnd ls an hmrola lbr ho PREMIUM [rhd above, wtildr h payattle wl0rh 16 days of lho dat€ her€of,
or A) qap l?onr tlp fEodm &b 6ot o, whhtlcl,er h labr.
A POLIGY ruflec{ing the abovc Bms u,il bo pr"pEnd and scnt to you shorty. The pollcy prsyidoi
aou3rsgE
$,hkfi b dlfieioril from that prwldod by moet dpr polides.
..) |
.SEEATTACflETT ErhibitNo.305
rPc-E-l1{t
Rcading ICIP
Prge 22
J. R. SIMPLOT COMPANY'S MOTTON TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
IJ
TTIIS BINDER SI'PERSEDES AT.{Y PRE\/IOI.ISLY ISSUED BINDER.
AEOS lmunno Scrvlm, llp.
lFP?!l6n08thro
Frgc 3 of3
&AEGtSO
AsEocltbd Ebotlc
3W.ffi.
l{tmllbn, Bemuda
Jue 20,2X)ll
WRITLT{ STATEMENT FROII FOREIGN IN$JRER
REQUIRED BY REVENUE FROCEDURE 8I-21
ilr,u='Ar"odarti L-lft e ors ruunne Sendes urrtlEdriiuudl RoDert3&lndng
a0r Floor
OneCtrurclr Strst
P.O. BuHltt2466
)lamllbn, HIIJX
BERI,IUDA
ftmlum PcrM: June 1,2011 bJuna 1,?o12
Thc lnEmal RetnucSatvlcaClRflh; bsrrd Rewruc hoosduncSl-21, wlrhfretelslhet dirgdinare&
end U.S. bmlten rill be mttpt fiom lab[lty fu aV umH Federal lnarmna Exche Tq fFEf')fnpoeadD!,
dac0m 4$rl othc lnbrnal,Rec€nuc Oodo.or.underurllf,rg penrlunr filhcy Ecdve a dabrnenifiom alirt{n fsnrer !o fto ffict hd thc punlmr tlrey pay aru esct b U.8. llrsna tax and concanihntly3xfiril frfii FET. Thb daHmnt $[ een,e ar he debmant pmeaibed by $e lrc b *bllth tle FEfa[lqffio.
AECiS hs rscelved a prMb rukrg ftom tre lnbmd Rwenle Scrulcs to tte fr€ct that I l! .ng{Ed ln a
u.s.
hrdc or bughraa snl unthrwrithg pEtu ffilbuhble b Euttlum! peld b I wlll be suf&d b lncqns b,t.
The
ndhrg aho provEcs that$fi premtmr are cxsrpt tom the FET.
Thb aE b sdvlt! ytru tlut all prumlunr plild.by you to AEGIS wlth rropcdb the caplloned prsnlum
porlod wll
cau0tlo an lUm d cilhcfinly u$e6d hoome b AEGIS and hur an Exernpt ftqn FET.
ASSOCIATED ELECIRIG & GAS INSURANCE SERI/ICES LIMITED
JohnJ. Drurun Jr.
Trrlunrend Goildhrllbuo[ ffinl Affiig a[r in, tu Gturrt ed. P.O. Bd HfAa56, ]htnhn HU Jq Bennub {4r 2*,2t31
AEqS rid ir.AEoEtogel,lfuoE tdfutb lihdodAsorhd EboficiG.t lns no8rld6r lJnlbrl
800r, FETL(00,200a
-9AEGrSASSOCIATED ELECTRIC & GAS INSURANCE SERVIGES
LIMITED
UNDERLYING LIMITS SCHEDULE
TlE edshXe la ailaeficd b std bmr apart d hm 6 of the D€drrcnB d POL|CY t{o. Xl6T6AlAl lfr llrb all undcrlying hErrale or adf{n$!d rgtentlom mahHned bythe NAIIEDTNSURED efiacfrrs
trls l ct day of Jule, 20'l 'l d t2:01 A"M. Slanderd TIme at tte addr€ss ot tho ltlAMEO INSURED.
lneudort.Itlmunrd
$i,(t(lO,OOO any onc OGCURRENCE - Genenal Litslllg
"SEEATTACHED'
ErblbttNoS05
IPC-E-I1.08
Readlng ICIP
Pagc 23
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 7l
MARSH&MCLENNAN
COMPANIES
IDAqOlt,IltG
f,fi6111yfrrrn,lt?
&rLy t1 2ell rc JuLr l.+ z0l2 loucr TEmr
naumn Tf,Gls]XIIBING ABGISNDNDWAL
IbLrcYSonil ABGISno!j["rFffld2tm,otxrxlt AEI,III PIOULY FONM Z T(I,
{lrDo{xll '
kmAnYlrmm l25.m.m 82s.m0.(x!0 hEn/DEcn
f,iulanoN!
-Erxeruinr.rrnson
+ioaErrg nonltrNAn r r. PEnsils
:loormrrs mr SBomon (ho INDAtr htrctrs
Emurn Ploorexs w/ rrgrrrprr Wloxeu,
Asr
.SLomO(x, Aoom.rre m[ ^llr Gfl Errmr
rn if plrr rrrrrIrl tn Clrreruvt thanrrrnr
$
30
t@o(p
tt(n0m
s0
$o
900,000
3sfl),(xx)
PNroutir
-hEtilflncI.fnIA $l39fsgt
(Dtd.JD8s 296 noR. TRIA)
s136,159f
(trrurDDs.296m,TRIA)
-2.5%
:tr . j.:et...i/ j.: j.r".i.i.,ji-il\ij i.ir,:.
@8rALIiE6(GrrB)2Al $Lras -LYc
fg5Jr00J0 sl7lJ0 sl5?Joa .:r;5!6,
ND(nSEUE|TS:L Erphdoo (C) tt mdcd b Frol,iih e crl but fu ccLh fitrs drd
paoalticr. Covcngc b providcd rt I Sub Lidt of Si Million wttob is
put of bc ortnll polisy rggrosrb-rr pc oq*ing dt *t;
Ercfurion(B) il.@dd bg;o ri& edavo brdr o ltG BI/PD lod PI
cxctrim fin e&inc Eultfot fuo eo dafion droy Mubgd Cbrt
SrrviacProt id.rude'ld uddryof rny bmft undcrahcol6crmph.aspcrapiirg cr,lnl?;;
Ancndd6iltooofcbimb hchd! hvccdgrtius by.tb DOL od
PBGGU pcr crpiring codt #3;
r{rcrd dtrithn ofionnod donment, Tnuto b inchdo mly
'tatunl p6rm" U!tser. This clininrB iiluc ofl&oorpb lhitbofug
ctodd b ouidc corpom trdcorar pcr oryiriag df #4 & #1,[
Dilcwory pcriod .ndonomt .t 125% ofihc arirnual prmiuu. Ebctioo
_!*ltl+ bihhlt ar pcr apiring cmdt #5, tut w .ith c@o o Odald
fwu.
Sosuilior Dodrptibb fudormot. 35(X),000 iq tho aggrcgsE ftr ro1
CLh h Chole orhprrnlod b [E IDACORPIe lhcuilicC, !s p6
oE&iagoodt #5;
EPPA cxloriorn ouhnoucot prwidcr aorrogp br vlohlior oftlIP?A-upor@fudft?;
Ilolction of rcwsim ofurcb csplurk urr pcr egeilg cc& #8;
Nodco of Cldn or Cimnfhnccg.Bodmmat b 'lotcc.ofdrt,rnnngr u goagnl uffbl, .s pc qirbg codmcmt No. 9;
Puailivo Doog:rMot FrvuaUlo Vcouo,BodFts pcs lnpiring sldt f l0
FEB E clu!fu @) nnat rddrwcbeoCfitrduc oxclrdm, rspcr
ogfttngadt#ll
Acquirilion, Magor rod Tcruirilion Birtt auondod to prcvido (e) 2$,rr
rsia tutlhold rld Olfc.roqdddo covcagc for outarl iad rcquircd
olrldiarior (o) nmndic oovcngo for eomgd pln: ar pcr c$foiDg
itrdt#12
Odcr of Payus Ea& , rs paopiritrg cndt #13
Amdcd Cnooltrtim hdt*ucollrfiou rwnded to be ra*rucclt$tc
by ttrc Coryany crccpt Or m4ryurnt of ptoium I ceulhblc by Ere
hrurd oo a pro.nlr bmis, es pcr cxpiriag codt #15
AndEd Dofnitioo of Sporor Orgrdzalion-Definitiou (P) Sponsor
Orurnirrtian Ar*rrlcr{ tr lnnlrrila lhc'trgrhho drtrrtnr in mrclrinn or
1.
t.
9.
t0.ll.
t2.
13.
Itl.
15.
Erhtblt No.305'sEEArrAcHED' ff;-##,
Page 24
J. R. STMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page72
slt! outsido tb lhitsd fui", rs Dcr lnBfuitrg ii& il16
16. &trrildcd Edudm @[l ) - Pdor noticc exslruba wilI ody qply c,im
nepoct o a Fldwity polioy, ls pcr otpitirg ddt #l?
l? . Alqdrrl Corf,t'un (A) Badt-Adr, N.d@ or Wrmdes ir ocrihd
tr hdicits &B Polisy ir uou"rt*indsbtc aith tlrpoct bNrtural Pcrsol
lorui& only, ro pcr eryidai codt *ttIt. IhlaimofBrohdonr, ddcrltc knomdrormdmslt liblyb givc dle
o a Glrlm ost dirlosGd or ninrprcrmEd il 6c Lmg Fo'trn {ppifcrfioa(qdudm &cc mt rpgty b Rcqcwd Applicntimrl rc pcrogHng c'ndt
#19.
19. Ancutod Noo"Dugtiartiou of Lfurib Eodmoorcnt ftrnrucrlpl) to nc
allow mrdingb gppb tc AEOIS D&O ltudq rr pcr ttptoiEilodt
#m.
20. filGabcf, Vodng Righb Eodoils@t{ pca qFLhg coe fll Polio.y
dro cd&r tc Spoor Orgoirdim b s vuE tir qy mdil ailtniEd
b rte ndnhffr of,tho Insrcq u.per crpfuing oodr #12
2t. OFIrld: Tsrshrlltr.ldTRIEABadonmtAEttIItl hcrbyffir b.povido &c doroorned,ryplicani Fmmqo osvagc ftr rn
1nnr$d. hd n*ulthg fon a "ct of tsmrlgrt?' crph r dcdpqd'by
ec TcuuimRi*Iuumso Ar*, rs rmirdcd (fu "Fcdrral lref) ol
tiE lsmEms rnd btcsrno ainouuts ac lou ourod byoftr avom
covsndbyyorupolicy. (Erc[of$6c boldld tsons b dcfiod bytr
Fcdcrd A.q &ose rlctnilior oqot w gru sfoowrep udcr yorn
Doliftl Phrro llrd$il oftrceroftrlly (IcAEGIS Era6 for ftlt Eror)
ErsrDoliry:lm2-lXX+Pcodlt Or Prhr Mrilcl Fo[ow Foira (,frf, !d.) {8 plr
BpldrSGoil#I.
lT02-l3ll45-TmiodonFol[nrForu ({/07 cd.) u pcr crptiry ffi#z
14.{n-B'[38.Amd bsrtrirg CbrilG & Drylctioa of pntulyfu Liritc
Sdim Endt (9OB cd.,) u pcr qfiing eoff #3
lt10{0li- Not Follov Fonn sf Torminn Ercluaim (05/03 .ed) u ptr
crgehSEtrdt#46. L+z-g2}t4oqliooo With Agplic$loTndoSaartim Lam(,U0aerl),
arpcrergftiryd#57. !102J963{olirmc Eodononat (12105 od) ar per cryftiog cnd #6
l.
2.
3.
4.
5.\
Ooonm r:g!1-#.. lF, cfrstr b OG Af,GIS prbar, fl{rry cv;:rgr:. Atl covurlaudlrtE AEGISpolkytr h*cuduc wi66r oPirirg policy ern
ChEbb l,urr ndoArry Crrrm$ Oonmtr:r Nl cwqago rudor 6, Orlib polby b h reoduoc wi6 thc qlfig policy Orn
SuUoc0vll[rro AEGIS: Nmpo Chrbb:r Ury-dstyingbindcr,priortobitdi[gr thdartyingpofiry,nhavrilablo
.SEEATTACHED'
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
ErhibltNo.305
rPc-E-ir-0t
Reedlng ICIP
Prge 25
Prge 73
MARSH&MCLENNAN
COMPANIES
IDAGOXP,!rc.GMnfiTLCIE
C:rla.Corlrr{68raury:
rtc Ctutb poUcy ftm ir ee cxplrtng. 1to20llitslfilElVlsbrtocwara0*orbotcrpaiunrgivcnilnthckracodroradpricirglcorinbelowrnzlct Chubbbrs
rgcd o a4!6 rodncdon
SobJcrfivltlcc Norc
.gEEATTACHED'ErhibttNo,30li
IP'C-E-ll{l8
Rcrdlng ICIP
Pagc 25
,
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibir 8-B
-Etrrrrrrnllcn-Itntrlrs.I,{T AlE]t
-Iareny
-Ctorpurrrllrtp.IUtDsTTTr[mBIIAIID
-Uoxly(Dotf,l&CootlElltl
framqqgereiferru4.grrGrrrrd
i25,0m,00
$5,m.000
$E,m.mo
t25ro0.0m
$t0o'm0
il00,0m
$oopm
.32r0q000
t2t,0m,000
$t0o,om
E2tmpm
se',(nq@
$ri000.m
tillt000,0(p
fl0q000
$lo0,m0
iat00t0mstt,@0o
l. 11q02.71ol (Ed. I l/20@) Po[cy Fora Ooocqd Tcq & CorOd6]G lxD2. 10@-1295 (E{ 6/20r} Iqsttc N@c o Pollcytoldar"ar q?. lq2-l6n@&$.ttrdqaioofplbyEo&rrarrat: paogp#l4- la@-?{O (l lrilm) lrLb Aocarky Edt W@ L rr pocrp cndt#l5, l{{D?g9t{Ed.'I lAffDNodocoftsqotd Scn 16 $DGrcilp6. l{,i0,}{lffilml0}Coryliioe tith lplic$lc Ttrdl Srucio trm.
GinrOorcngt Sctio!l. la{2-75U, (Ed. I lizllD)fdtey lclr G&!. tccdoa.As Erp2^ l4{2-lma0.AnrdRofo ftr Spcoift lrnrhg Cl$rc{. D6 ae cdt#t.t. l'1.02-1068t (Ed.rrm0, rrmdlldddorofE4toycoro paorg odfla, l{.O8-l@4 (04r40t) Aoood Dc&iittoo of Ercortlvo Eodrlu psr oxp crad fili. I{{12,1355804f200t)PcodooProuaionActEdrmwffitBodbupgcrg iudtil46. l{{r.T{fil.{llMlllf.lAffirdDfiDithuofEEployooErdr.rporapcrdt#il7. l1-@,85n gffrUs) Amnarrion to Ic Dfuwrsd Eorlt rr pcr crg cudt t5t. t{0"t 14(8,:mGIr!hE Eptudoo lTEdrrpcc4iringcod}7'9. llr{Amf0 (lqr003) IohVetnc &ilt{8prcrp odorhmt#t
10. 1fl2.8l07(102004)-/bErd&chuiol9Endr-CorEag!do€notrpplylfnrdllocciroovqd
uuilarm*elsrtpt*mr goticy otErcdbyChrbb rr pccrp ondt*g
I l. l{.1p.t93- p264 Amd Sdrditn el ChoF hlryMlBl&-O intrr ho rporring
dD fmr foir O dryt !o 90 dq,H DGr Grp d*10
12. l*&{9?I (l Ul@) Aocuil Sdrrpd,m 2, Lhr&b sf Lilbtliry Fd R.qtionEndt g pct otp odt#ll
13. l+{n-8925 (1mm3) Airlod V.ludoo of Saridco Butt u porcxp ar& #12
14. t+l2{ga6 (l lf20lB) Adld Exdurimr Bndus pcr ap afr-fi 3 -
15. la{n"09xr$ l2lll3} lrud EroHoo 8uilcpa cnp o&f,14
16, t{.{E l92t (l l2oll) Arud Erclrdoo &,u pcr op cadt #15
17. tiln"t93lA ({D008$mdDofrnidou ofEoptoyrhu rc pa q anb#16re l{{!.t t2 (l lrilm) Anod l)lfrnito of Sauiti6r Eadt c F {p rdt#17f9. 14{l-t933 (lt20GlAffidn olly0dcrudOoutr&itOnnwyFmd Eu& rrD.rcrp Godt#lt
20. lfiE-9145 (2fZl0{) Arlqd Ercftni.n l2@ffl)Bdonanmt- arprop cndt#l9n. l{&-n6[ @Ul0{) rlnad ltcnnliol ofOoputc $yrm Endt u pc :xp rndt 20n. U-@-g$l O/r001) Armd DGnlidon ofDiocovry anrl Exdruiol l3b u pcr cogtriog cndt 2l
if
€oQsatidt
IDAHO POWER, COIIPAT{V
lttlilum crdmrb lor Burrrntrsd Golt Fhn
Perlodr 04/01/2011 - OqAtl,zOLz
oo
3.rtooPollcy: 2598
Plaa: 1
'75:t9
. 8810
Elx Power Co-Noc-All ErlF & Dr
Ofilce Chrlcal
. $3,755,195 - 2,73W,422 -.15 $102;su
s70
)
Tel Ptylofi'- 13,801,617
ilanurlPronlum
Expcrtence Rlilng Modlllcluon
ttendrd Prumlum
Premlum Dlscount
Dhoountcd Promtum
Terrorism Premlum
Catastnophe PEmtum
IIcBS-Prcmium Ass€ssment @ 6.4Y0--,Totrl Fremlumt and Arscrrmcnts
.SEEATTAC}IEU
+
+
+
- $102"586
.e2
194,380
- si?.gp?* igl,473
t36o
3380
,-t5z6i
$E7,49ti
Pmnrlufi dlroouotrdtdulcFlrst $3,500 0.0ttbl{e,il $14;5fi1 10.0%]{ext $82,000 15;0{hOrer $100,000 16.5%
Trnotfm pCrfirm g totat palmlll100 il.01
Ctbltrorhc Etndun - total paFoll / 100 x .01
hcnrlum rnd ratlng ?actolt wlll drrngc o[ your $tnlvrB!ry taliqe (lltr to &ose ]n €ttroct rt th* Umc.
Your pollqf pn:mlum h bagld on your qrfcnt sstimrtrd pnmlum and may b6 prored for pollclcr l$usd rbf lers tjran a full ycaro adlultrd brged on rcH,]al p.yrutl'uy d.EE{fr€rtfon.
ft rhf-tD0o|.l-Fc|(LFilr!B!&$ildrdh,lffirDC-E-rr{s
Rceding IQIP
Prge 2?
J. R. SIMPLOT COMPANY'S MOTION TO TAKEOFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.Exhibit 8-B
Page 75
REOUEST FQR FRODU$IO]{ ilO. ft: Rehmnoe Dh€ct Tatlrmny of Scott
Spa*s, p. 39, lines 1&,20. Pleese protrHc the lnurunoe clainp br Gorrpany-orned
eqrlprnerrt aeaoclded lrlth fie hd[fis draqp f,led by the Conpeny frr eadt year ior
the yeqts 1987 hroryh 20f0, orgmbd by rai. Sdlodub.
REiFOffSE fO REqrEgT S PRODtIGtIOilJfO. f0: Thcro ale bchnl€Iy
m'lngurancc'dslrrc rcgnrdlrB thb equlplmt a3 any bcg rlurhg that Umc franq fell
wlthln Sre'sslf{neur€d deducilUe range. Hurrcwr, ldaho Forusr peys br any euotr
locses dlr€olly (uilfrotfi any lmulanoo Gcorrc]y). ldaho Poualt cununt siendad
propelty ilrerranoe deducilble ([e., gfi.lnsrred) b one mllEon &lhns per loae.
Ihe rBspmse b hh Requ€d was propared by Tim Tudrer, Pmpefi ard
Cssrnlty Adffinhffior, ldaho'Fouer Company, at thg rlircc{ion d Scot D. Spafts"
Sentor. Reguhbry ArralXnt, ldaho Forner Corpany, ln cons.iltation rflr Jamn B.
Wllamq Corponrtg Counssl, lddp PourrGompany.
DAHO FO,YER @iIPANTS RESFoiISE TO THE SECIOND REAUESTS
FOR PrcDUCTION OF THE INDT'TITRIAL CI'STOTTERS OF IoAHO FOU'ER. IO
__.t I
Erhlblt No.3lxi
IPC-E-I14t
Reedlng ICIP
Pagc 28
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 76
\-' )
RFOUEST FOn PRODI|GIHN llO. t0: Rffinno thc Compmrrs Rcglorxa
to lClP Roquest hb. f O (sbtlrE'vlfitaryail'lnanpd' prupe0 losaesoernlrU beyond
lhe Compsrya polnt of delhory muH fal! mOer Haho Poredt sef-halrud property
rrtentlon (dedrrctible) and rrould be an epansa incurrsd dlndly by the Compaql)"
Pleate crglaln hor tre Conpary leworE osE as8od{.d with lts 'eef-lnqrrcd
plDperurciontlon.'
(a) Des fie ftrnpenyrconercrrcIr sdf-{nsulgdamountBtrorrgh nabs?
(b) Hor uould the Company pas on lts unlnsumd lossss b alsbmem? For
exampls, pkaso d€ecdbe tht ratemaklng t€atmnt of an unlnaurerl hllure of a piece of
dlsrbutht €qulpmonton the Gonpanfe ride of tie rn€brthatfelh pdorto eryiratlon of
iis rlrymhtionB$odde.
(c) Haa the Colnpany aor lmplensrhd sirvdlar tmeUo€nt br a pleca of
dlsU{butbn equlpmeril beyond tre polnt of delhory. Pbaee erglatr rrtrat pruronts lhe
Company fiorn t€alhg.unlnsumd.Edlfries duqe dlgtdbu[on equlpment diftr€nt ftEm
urilnatmd dMlbutlon e+{pmet rct s&iect b thc lhclffies drarge,
RESFTOI{SE TO REAIEST FOR PROUGTT'T !IO.53:
CI Yes. The Gornpany rtoovara cosb assoclated fith setf.lrrsutod amounta
frrrough Commlsslon-appmrnd rabneklng prcoags. Seff-lnsuted amounts (cosb
falllng belotfl the Companfi sclf,lnstrrcd ntinlmumc) pakl by the Qompany are booH
ee elgonsos and lnckrded ln cugtonrer rates in the same manner thet other @pffy
expensos ate raovercd
(b) When disUlbrrtlon eqdpmer* falls on the Ounpanfe elde of the me0gr, lt is
rdlr€d and a new piece of equlpmert is irst0llcd and beglns depreclating. Any
IOA&IO POWER @MPANYS RESFOiISE TO II{E SIXIH REAUESTS
FOR PROOT'CTION OF THE INDi'8TRNL ct,tlTOMERS OF IDAHO POWER- 16 Brhlblt No.305
rBC-E.Ir.,08
Rcrding,ICP
Pege 29
J, R. SIMPLOTCOMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page77
?dlrtshant in depnchillon ratos reeltry tom eilyfirilurcs or ldmmenb ls rdect€d
in tho Companfe next de@atbn dudy. Dsr€datgn.strdlos aIB done on fiw-year
qtdea. DeprgolalEon opcnsos ara tuooybttd 0rrough automsrs'r&r becauge thls
qqqhmnt h ured to s3n€ multhle qEbrcIE and ls not Eohty dsdhatod b orlg
crcfiomcr, wtilch lc the ac br eqdpnrm subject b the trdlltbs cfiamp. NoEbly" fie
examph prcrrldsd frr h Oft @tast doos not tquacrt a bss br lnsunncs ftrpoaas.
(c) Ycs. The Gompeny tBfr rrphoenrart of c$f,trrffit irfiurss 6r
dtttdhfon equhment bclord tre Companfs polttl of drh,tsry h a slnillar manncr by
adlusdng cucilonrcra' facilltho clraEee b rc!f,ed the cpst o, rcplacirU falbd equlpnrent
fne Conrpany hao nd ard does nd lntfid' b tut.satr{rrsurud EdrueB drerge
equlpmantdlfiercrrilyfum celf{nsrcd dhfrlhrton eqripnenilnot sLbJectb theftdllfrea
chatge.
Th6 ltsponse b hh R€qrrst vuac prpand by Soott D" SpartA $enlor
Regulabry AnelysL ldlho Pou,er Corpany, in onsrilation wlth Jason 8. Wlllams,
Corporab Counrsl, HalE Pgyuer Company.
lDAl{O POWER @firlPA]lvs RESFONSE TO Il{E SDfm REOT ESIll
FOR PROTN, TON OF THE I]If,,t,STRIAL GUSTOiGNS OF IDA}IO FOWER. 16 ExhibltNo.305
rPc-E-l1-,0E
Reading; ICIP
Poge 30
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
RFOi EBf FQF PnQOUgt-tOr ilO. r0: Rsfersnoc te Gompanfs Rapome
b lClP R€qt od No. 2,(c). Ibos ths Oorpan/s lnvdnrent ln dhffiutlon lhdlttha
lnsfialled beWrd the polnt of delirrory (or the deplucQtatl rralue theroof) Emain
anyurhen ln the Conpanfs levslrr nqulmment f the eqdBment explree prbr b its
3l*osrdepmcffin shedde?
No,
Tho meponee b hl8 Requeat ruas prcparsd by Smt D. Spailrs; S€n0or
Regul&ry Analyst, Haho Porer Cwnpany. ln consultatlon wlfi Jaeon e Wflfams,
Gorponte Counml, ldaho Pouver Compny.
,.)
IDAHO POWER EOilPENYS reSPOI.ISE TO THE SXM RECIUEST{I
FOR PROT'UCTIOIII OF TTIE IiIDlJsTRtAL CUSK)MERs OF DA}K) POYYER - 25
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Erhlblt No.305
IPC-E-I14t
Reeding, ICtrP
Prgc 31
Page 79
REQTEST FOR PRODIG,IFN 1lO. m: H€aso dmt or deny ffi h medngo
nrnh rcpreenta0ves of the IOP ln the fiall and wlnbr o1 2010 rWan irU Ore faclliles
clurge, ldaho Potuor rcptrlcriletvm Sftod lhat lhe reason lha Company does not
apply a deprudaton sdreduh b ho lnltal lnvsfirenft h fedni€B drarf equFment ls
that ldaho Forertaltes on the risk that lt wllt haw b rWhce a precp of Eiled equlpmcnt
Ebr b oqlr:athn of ltn depmdathn droduh. Fbass also adnfi ot deny that ldaho
Fow€rffibd that ils lrtnrarpe polirrynould rptcowr replaement of such equlprreil.
REBFOIISE TOREdlESf, FS PnOdrCf,lQll ilO. 70: Tlr @mparry oblccts
b thc forrn of ttp qusetlon as il ls not a proper fuim of rcdLffii roqu€Gt per the
Commlsshn's nrle& i,lotrrlffindlrg, UatE Pouer asserts thet lt uses a lerpltsptl 31-
yuar rfirffit llne @mdaton sdrqtile ftn the Compan/e lnlthl lnrre$nsnf |n fadltieo
cfiarp egulpmeil ldaho Forcrfurther assrls firat under fie Commlsgonappornd
facilltle! ctnge pmvlebna, llp Company wlll rcplace a falled pleoa of e4ulpmant prtor
to erqlrallon of lb depreqatnn $hsdule tifthout fulU teoor,€ring ttre oo* of the falled
plee of equfment. lulorarcr. Ere Compalfe frsunne pollcy doas rpt apply io
replaoqnent of pieoes of qripmert trat fall prbr b explnaton of thelr oeect€d useful
[h ar thesa arc not consldcrsd ingurable toeees. Thls uns fudrsr disol$€d ln the
Companfe rcsporne b lClPs R€qrnst t{o6. l5 and 16.
The rceponse b Uils requort wac prcpqrd by Scdt D. Spark+ Senhr
Regqlery Analy$, Haho Pomnr Comparry, ln ootdtatbn wlth Jason B. Wlllams,
Coryomb Gounsel, ldaho Pou,Br Compeny.
ftrA]ro Fon ER @MPAI{Y8 RESpOr{gE TO THE SnENTH REAUESTII
FOR PRODUGTION OF T}IE INDI,SIRIAL CU8TOTERS OF IDA}IO POWER. 1I
,
ErhlbitNo.3ll5
rPc-E-rr{8
Readlog ICIP
Poge 32
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 80
i)
REOUEFf Fffi FRODrcIl9il ilO. ?il R&rcnce the Companfs Rerponse
to lClP Rcq'tst l.to. 58. Please onfim that he Company ruould rscaver the uningrred
cootr of such equipment Eiling priorto elplrafion of lts 31-yeardepieclatlon scfredule in
ths mannordlscussed ln the Corrpanfs Reaponse b lClP Requcst t{o. S}.
BESPTONSE To RESEST ,fgR PRODIEflOI{ ll0. 7t: lf a plsce of
equipment under a fadfiUos ctteee tslled prior b esra[on of lts 3t-year depreo:latlon
sdredule and was included in fie Companfsteetyear baae tut€s, then rcoo\rery of the
unlnsured osto of tE ftild equhrpnt rror.dd o@ur through cusbmG/s rates as
describsd in the ComparVs Rmponseb lGlP'a Requed t{o.63. }lorrcwr, itthe piece
of equhment failed outst{s of a hst year, thon $e CompanyrvouH nd r€@\rertho full
cost of the equhment as ls the case lbrallof the @mpanfs dhtrlbutlon.€qdpm€nt.
The response b thb Request was pmpamd by Scott D. Spaila, Senlor
Reguhbry AnalyS, Haho Powsr Company, ln consulHon rrt0r Jason B. Wllllams,
Corporate Gounsel, ldaho hror Cornpany.
DATED at Bolss, lddro, thb 280t day of Sepbrter 201 l.
IDAI{O POUI'ER. COMPAi.IY'S RE. SPOI{SE TO THE SEVENT}I REOT'ESTS
FOR PRODIJCTION OF THE hDUSTRIAL CUSTOMERS OF DAHO POWER - l,+ExbibltNo.305
rPc-E"tr-08
Rerding; ICP
Prge 33
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICI,AL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 8l
BETORE THE
IDAHO PTIBLIC UTITITIES CONOWSSION
cAsE NO.IpC-E 1I-0E
INDUSTRHT CUSTOIIMRS O[' IDAHO BOWER
READING I'I
IESTIMONY
EXHIBIT NO.3I|6
Ideho Power's Rcrponseo to Prcduction Rcquct Nos. 19,20, 5?, and i
72 Regarding Custoner Consent to the f,'ecilities Charge
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
'.../ i
Prge 82
\)
REdrE$f FPR PRQDl|cIPll 1{O. 13: Flslbrcrm Dlrwt Teslmony of 'Sott
Sftl€, p. 35, fine 7 (dahg, :At tto optlon of tha Conrpany, frdfrlos cfiargrec rnay be
oilbrcd . . . .). te the Hliles cherge oflond frr Scfrertub tO crrebrnalt, or doos thg
Cunpany choose mofur ary lbdlites beyond he poht d dehnry tflfl bo ourcd by
heCqnpanfl
REEEpISF TO RFoITEST F,qR PRQpUCtItOil rlo. r?: As srlbd rn thc
Companfstadf; lsll[os charym provbloor ars ofiarcd il fie opton of fie Conrpeny.
llUhen ceMe ie f,rd egtablbhcd, Schedutc 18 onUnen en expectd b provlde
frdlltlee belpnd lho pint of dclhrsry. tlowsyor, lf requsahd by the c-tnbmer, ldaho
Furer my otbr b iln, oponb, and maidein su& firtIflUee wh[dl, il fficmd and
aoccpt€d,rquh.efadlfrleec|rergsmthlnstodomlblhccuefunpr,
The leiponse b fib R3qtlst w pmparsd by Scott D. Spelh, gentor
Regul&ry Anallot, ldaho Porer Cornpeny, in mnsullalbn wftr Jacon B. W[[ams,
Corponb Counge[ trhho Powen Cornpany.
!OA}P POIi'ER OOTTIPANTS RESPOIEE TO'II{E SEOOND REOT.ESTS
F1OR FROMrcTloN OF T}E hIDIII}TRIAL C. I'STOI{ERS OF DA}E POIIYER . 20 Erhlbft No.306
rPcJ-I1{8
Rerding ICIP
Pcge I
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Prge 83
REOIIESTFOR PnpDUGIIOil ttO.2S Rclbmncelho gchodub 19 Tatffi.
(a) Phase adnlt ordenythatheSfisdule tgTeffi$abc:
At the opton of he Corpany, trel$rmerc and otlpr
hdlfse fdrllod bq,ond he Polnt of Dellwry to
ptotEd Pdmary or Ttanemlaslon SeMe may to
ownod, opsntodt and mdnbhed bythe Compary h
consUerdon of he Gusfumr payim a Fad[tes
Chargpb the Cqnpany.
(b) Please admlt or dgry llut ttp Sdrerlule lg teilff pmvldc no fitsmett
.that cudorpn have the optlon h oyrr and operab sll fudffim beyond tip polnt of
0ethrcry, lf deny, pleace @h.
(c) PIW pmvide ttla legal basb for the Comparry b tuqulr that lt orn
faclh'lb*on thepmpe@of Sctrqlr# tO qr$nren. lf fte arrtqrnor.doo! notconeentb
ttr Gompany phcJrU ad matntakrhg arch e$lprn*rt on 0re q.r$nnfs property, dm
me Co pany beliero hatthetarffi gis ft fio bgalrUht to do so? th€the Comparry
offiln wrlten conrent fiom curOrma b phce lbotlltlos oo the qlgbnrers' proport!8
VI|M tpe of conseril do€s tre Conpryyobtrln?
REEFOTSE TO REAUEST FOR PRODUGIIOiI }IO.20:
(a) ThB nrtt psragrafi of tre trdfitsr drame povlsbns ln Schedule tg
Sat6s, 'At fis optlon of tr6 Gonpny, tnnslbrmeo and o[rerlslitec lnoh[ed beyond
the Polnt of llellvery b plovUe Pftttry or Tranimlssion Servbe may b€ owned,
opembd, and mdnhln€d by the Compny i,n ongldordon of fis Cudomer paylr€ o
Facilitbs Clwge to thc Corparry,'
(b) Sctredule 19 stetoE $fiat l&ho Fotrcr udl pcalbly do beyond the polnt of
dolh,cry, but is not lnbnrled b addrcsr wlrat fltbrners may or rTE!, nst do wlttr their
propeily.
lDAl{Q POWER COilPAI{YS REBFOiEE TO HE SEOOIID RECUESTS
F1OR PRODUCTPI.I OF TIIE INDUSTRIAICUSTOiTffiSOF DA,}IO FO'VER.21
I/i
Erhlblt No. 306
IPGE.IIfi
Rcadtng ICIP
Pege 2
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 84
,]
(a) ThsG ls rc legal roquirumert that fic Company own ftcilltiss on the
ptopctU of Sdrcddc 19 Ctdomone. Ai he crdonrefe rgqued, the Company, at lls
optlon, may trralall Company-omnred facllitlss on tro cugtflnar glde of the polr* d
dellvery. Sdtodub 19, on f,e ffd apUDvEd ry 0p Connrilssbn. glvta the Gonrpany
&leopifon and the logal adtortybrb so.
The .ry b trb Rorpod rm prcpered by S@[ D. Spe1&, ary
Ragulabry Arulytt, ldaho Porffi @mpary, ln onsulEtlon with Jaron B. Wllhms,
Coryorrb Coungsl, ldaho Fousr Gompcny.
DAI{O F(II,ER @IIPAIiIYS RESFOI{SE TO NIE SECOT'D RECT,ESTS
FOR pROqrCnON OF ItlE lltDt $fRlAL CUSIIII,ERS OF DAIO FWIIER . U ErhlbftNo 306
IPC.E.il-08
RerdlngICIP
Prge3
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 85
REOIIEST FOR,FRODUGTION I{O. 57: RcGtpnca the Companf3 Rqonra
b ICF Request tlo. 20(c). Pbase onfrm hat hc Conpany does nd obtaln vud[on
eoneent - though unlbm @tfiEcl or drsmbe - fiom cusbmorc prlor to placlry
facfftiea belond the polnt of defircry md slgrl4 tre crurbmer up fur fie ffilitioo
draqe. lf not plsaae euobln howtho GonrparyooE|ns liloflnsd $nlren oonsrtt
REQFOiISF.IO nEqrESit FOB Pm4rcltoil ]lo. c7: Besilnnins in A)10,
pdor b dat{ng fadll0co lnsbnod blyond tu Gompenfs point ol delivery on a faciltics
chqEp, ougbmert sign e Sgrr/ba Re$restfom lndcdrlg hat0ro hciliUes dtaqe nfll
be sdded or adlushd on tHr: montty porcr Hll. Spcc[frcally, the larUuagp on the
S€ndoo Rsqlot fum stabo, 'l undetdard ttr{ tre Facffiilee Clugos blfllng will be
added or adfr.rsted m hs rnorttr$ pouar bill ilor the vtork odsr oonsh.rdon and
nooncllla0on proooos ls cunplde.'
Ttre reeponse b thb Requeot wes pr€pr€d by Scofi D. Sperlts, Scnbr
neguffiry Anelylt ldolp Potitr Conpeny, in oonsufitstion wlth Jagon B. Wilhme,
Corporab Gounrl, Haho Forer Company.
IDN{O ForuER cOti,lPAilYS RESPOiISE TO Tlfi SlXItl REOIESTS
FoR PffiUCflON OF THE INDI STFIAL CUSTOI,IERS OF IDAHO FOWER - 24
I
Erhiblt No 306I[GE"ll{t
RerdinJ,ICIP
Prge 4
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 86
REOIEST FOR PMUGIIOU ilO.I* Rehrtne ilre Companyq Rosponse
b lClP Requed tlo. 57. Phse.provt{e the lsendoe Requed Fom.' Pleme confrrrr
that Us brm le nor pm,id€d b or dgmod by ulsilkrg Edlltlee,drargs orslonrerct €xogil
wlth mgant b rcw equlpment ln$aH at ttrlr premlree.
SPQI{SF IO nEAuESff FoR NflJcllol!, il9. 72: Plcasc aeg he
{tac*rarl Pttr lltc bra opy of fis Sonhc Rlqtad Forrn. :lhe SoNlco Rsryest fumr
for faollltlea chaqe qrdonrme ls slgned by narr cudomsre golng on a facllltles charge
ard by orisilrg cudorncr rsqreOng abratons b eqrlpment lndaled under tho
lbdlltb! cft aqe provldons.
The reponse b thh Roquoot wao prspat€d W Scott D. Sparks, Senior
Regulatory Analyet, ldaho Porqr Conpany, ln consulbtion vrtrr Jamn B. Wilfiams,
Gorpor$ Cotrml. ldafto Por,ar Company.
iJ
IDAI{O Porf'ER @MPA}.IYS RESFOT{SE TO TI{E SE\/ENTH REOUESTS
FOR PRODT.lCf,Io]{ OFTI{E INDTFTRNL CUSTOilERE OF IDAHO POIVER. IT ErhihltNo306
rnc-E-l1{t8
Readlng ICIP
Pege 5
J. R, SIMPLOT COMPANY'S MOTION TO TAKEOFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.Exhibit 8-B
Page 87
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rtrloll EtnryE@undrrgtoundO po rwtetr od ndid ftod !o urltht
pdmouedtfrnr.
ttn&crul futtcFrciliticC[rgor brllfu wrllh rddodcafuedoltlcumelyporrcrhill rftcrthowort cdccurstriifioh
rnd irmciliruim proacts ir conpld,
Itudalrddrdrcgrccodcctbrtin6rfunmovrboruu&rrnbillcdbosdoao*hmbdcosB R€qrrcbdcrtinBhr
irrhlbrcbocd oan crtuur, utdlicttud Eo!iltly F.ci[i6!r CD!ryc b billcd brrcdm utrul rccoo&dwortqdrr costrfur&rtllb
I wdry fu 6a rffirhem I havo pnldod E affiiE b thc bcrt ofuy lowbdgc
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ClicmSigaurc Deb MqiorC\stnerRry.Siguam DlE
ErtibltNo.306
IPGE.Tl{I
Reading ICIP
Page 5
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
a6t{ul
Page 88
\)
BF,X'ORE TIM
II}AHO PTIBLIC UTILITIES COMITfiSSION
CASE NO.IFC-E f1$8
NDUSTRIAL CUSTOMDRS OF IDAHO POWDR
READING, DI
IESTUIIONY
EXHIBIT NO.3O7
I
Idrho Power's Responres to Production Rcqucst Nos. 9, lO 11, and i
68, and Correspondence Regarding ldaho Power's Position on
Selling X'aciliticc Charge Equipment
J. R, SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Erhibit 8-B
Page 89
REAUEST Fffi, FRODIICIEI{ t0. g: h tho Csmpary uyflllng b sall the
Gompanyowned ffi bEond fi6 poirt of ddhrary b lE qldonrers d fiE
depredatcd book rlafilc? [ yr!, CGo e,phfr why trb oSon b nd pmvldcd lor ln t]u
Scfiedule 19 tE ltr f no, plcqr tt9hirn wlty.
REsFotlSE TO nEoqEF.T FqR PrcUrSTnil ilO. s: nb. I ls ur
Oompart's pollcy not b goll Cornpanyff,nod hdllfles lnstall€d beyond the polrrt of
dclhnry.
Ttls ro@lte to ffis fuqrH ruas pmparcd by Scoil O, Spails, Senhr
Raguhbry Anatd, ldatp Fow Compqny, ln comfiffion wltr Jason B. W[hmE,
Colprab Counset, ldalro Poru Conpsry.
lDAl{o POIVER @tTPAltlYS RESFONSE TO THE Sffi[E REOUESTS
FCR PTDUCmON OF THE rr.rOUSrRnt CUSTOi ERS On riruO pOWen - g Erhlblt No307
rBc-E-ll.0E
ReedlngICP
Page I
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 90
REaIIEST,FOR P.BODUC,npil ilO. l0: ls the Oompary $[hg b sell the
Cornpanfionned facl[U€s be!/ond the Dolntdd$,uyto ltrorstomcra dths trkmadGt
valtr? lf p, deaoe Wlaln urtry fib o@n b nd providod fur in tha Sotrodulc tg
trr|fr. lfrr, plaaee euqhlnwty.
RESFOT{8E IO REaUEST E9R ffillcfioil tl(t l0: tlo. lt lc the
CornpenU/s pplgy not b cefl Conpmy-ounred ffiUee hddl€d bqErd ttre poffi d
dolEv€ry.
The roeganr b thb R.qted w prWrcd by Soott D. $pailts, Senbr
Ragdery AnaW, lddto Fclinr Gonpany, h consrffatbn n[r .la$r B. Wlllams,
Corporats Curru.l, ldCp fuuor Osmpary.
IIAHO PG WERCCIuP trlys- rersPiONsE TO THE SSCOITII REQI ESTS
FOR PRODUgflOIt OFll{E |ND|,X$IR|AL CUSTOilERS OF IOA}|O POVI'ER - 10 ErhlbttNo30T
DC-n.rror
Readlng,ICIP
Prge 2
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 9l
REAUEST F.ffi, PRgDUCnOil floJ{: Rehr€no the emat cotrt{nad in lClP
Seqond Requosfs ftr Producfron Atedtmmt t. Plme erchh wfry the Company
determlrud irt ould not soll Compaqprnred fecflilibg beymd thg polnt qf dellvery b
J.R. girnplot Coilfqny. Please include cilplandon of boft baoc aaaerbd for ttp
rledslon nd b gdl firctHea - (1I LC. S 0f €28 and (2) lhe uyay ldaho Porrer unnb b
run lts bmlness ae a ngulated publb nfliU.
REQPoTIE lto FEf,llEsT FoR PnQoucllot{ ilo. 11: Comryy
t€pr€sorfitlve! met u,fth Don Slsrbvar,f, Energy ibrragpr, Comenaetton, Attsnstvca,
& Prcnrrcment brthe J.R. Sfnpbl Corpany (slmpknt Shplofs atlornoy. Mn Gng
Affirrg; and Shplofs consutffi, It&. Don Reedhg, Moe PruoUent ad ConsulthU
Eonorlst, yuith Eon Jefnson Asoda!6, lrr., attrclr nqueston Dsmmb€r28, 2OlO,
and agaln on Afil 11, 2011, b dlrouss tre ConUqnt/a poeltbn lEEled b fu eale of
Oompanfoulrpd hrilitiee b Slmplot, At the Aptll tl, 201t, me€ff1q, ldaho Forur
rcprceentr[ve etplalncd lhat it had made a bueinegs declslon &et lt was not golng to
rdt Companyorrmcd frdliHes to Sfrnplot As a lugulded publb ufll$r, thc Company
oper$s lb buelnege rvlthln the parunelen of the lar, its rugubbe, and lb ffifia tirltt
cusfiomerg. The Gompany lc hee to meke any buslrmr decislon Go lotg as lt dooc so
nlilrln thos6 psrarffiE ldaho ffi S 01-328 requiroc the ldalp Rrbllc tltlitieo
CornmFshn ('Cofltrrilsslon') to affnrtse the salc of arry publc utlllU propelty lhdlrE
&at tldl aale (a) ls concistentwlh the publlc lntetes$ (b)U*me co$ d a;s lutee for
supplying seMce wlll not be lncrreased by twlon of sudr mnsacilott; and (c) that Ure
appllcant ftr suclr acquhltlon or Uanafur har fie bona fHe lnbnt ard ffianohl capablllty
to operate ard malntaln 0re tansfened property ln ttre pubtlc eervlce. ln thle lnstance, il
IOAHO FO'I'EB COIPAITS REqPOiISE TO TTIE SECOiD REqESTS
FORPROOIJCTION OF THE INDT,STRIAL CUSTOil|IERS OF IOA}IO FOWER- IT ErhiDirNo.3l)7
IPC-E-I1{8
Reeding ICIP
Page3
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Ptge92
,)
ldeho FqDr sBrE to d$f b lot Companyowned fidnhs b Sttploq f rcud ri€€d b
heraase the rswrue tuqutumil arrd nbe b powr the nrrqrue requlrermnt ior
Schoduh fg cusbm3n as a lqdt of fto tanoacfnn. A[ he onduslrmr of the Apdl 11.
2011, mectlng, Slmphtr afrolnry lndi€d ltwas gofiE b sdtd a htterio Eaho Power
loqu6s0ng a bnrd prlca SEh lbr he amqnt n@elery Or Slmplot b pay br ho
mmovat d ConpanyouynoC hcfl[os on ]b dde dthe polnt of delhory that lnduded an
anrount mcegeary thafr *Y hoH aI drer Sdrddo 19 etrffinolr twnrbre. To thb,
ldalr fuiwr lras not rcdnd arry anch nqud. Rogardlas of unrdrer tre &mpany
does r€oonn cnrclr a lequest, ldafrro Fafl* ha! ddornln€d trat, at thls trne, lt ls ttd ln
[u buciness of se[ing thclo Upqs of Oompany{$nod facllfias t6 tlffi Bar0et,
Tllo rulppm b fih Roq-ugst was prcpantl by ffi D. SFllc, tsatp Forer
Conpany, and Gr€g Sald, Vlce Pngidfit of Roguley Afrhs, ldaho Fmtcr Go4any,
hr wrsrlffirr *tth Jmon B. Wlhmo, Conoae Counae|, E*p Pouan Conpany.
tDAt{o porreR canpmYs RE9FONIiE TO fiE SEOOiD RECtt EsTg
Fon pnooucrpN oF Tt{E utDusrntAl* cu8'Iot EHt oF DA}o FcnTYER - 12 ErhibltNo.307
IPC.E.IT{E
ReerilngICIP
Pagc 4
page 93J. R. SIMPLOT COMPANY'S MOTION TO TAKEOFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
REOIESJ FQRfRPDU$IOil ]fO. CS: Reftrencathe Gompanfs ResRonsp
b lClP Raqued i|oc.9,10, 11, and 5t. Phs€ @tfitm, decdtethe nagoneesbti66
quedbno tnt n b not the Oonpanfc policy b sel distibution fadll[os b ctptofiiers,
that ln Case No. IPC,"E{5-1B the Company sold dlsfribution fadlllieo b the Sun Valley
Compenylslncldr Oil Co. at depnolabd book rahp. Whet E fte @mparr1/s pollc1l,l
Pbete cmhin rrfty thc Company wi$ .e[ facfiHes b one cudomer d bod( value hfi
rrfrree b se[ b oficrcuctqnera at bookvulue.
REBFOT{8E TO iEAUH,T FOR PRPOUGilOI{ ilo. GE: The Conpanfr
resppnec b lClP Requcst J{os. 9, 10, and ll a[ deany eE $e Compe{rys pollcy that
It udll not esll Companyound hullltlas lnst lled bq,ond he polnt of dethrery. The
Comper$s rEsponos b lClP tlo. 5t thH hat hfie hst fi,a yeer8, one eustomer has
rcqr*O ranovd of Hfths lnsll€d ba!/ond thc Conpenfs polnt oI ddlvery. IPUC
Gase No. IPGE-OS-IS inrrohnd a unQue sluaton wtreroby tre Company ald Slnclalr
OlCompanydlUa Sun ValteyOorrpmy(SunVallqf) mufrrally:agruedto suhnit atslnt
epdication b tPt C b bansbr crbfir dlslbu0on hdlileo tom the Company b Sun
ValleS lPuC appoved the han*r, concludlng ftat fie transflr would "mt cauae eny
lncrease in rslos and Sun Valhy win be able b maffiln lhe aoqutrurl dletrlbrrton
hdlms neoessary b saro lb t€nartts. We find tre impoved o,psnrting efticiandee
senre the publlc lnbm*." IPIJG ffier tlo. 29804 at 3-,{.
Thc retponse to fiE Requd rras pregared by Jaron B, Wlllams. Corpomb
Counwl, ldaho Porer Compary.
rDAlro pioulrER ooMpAr{v8 RESF0NSE To IHE SEVENIH REOUESTS
ron Fnoousnoil oF TF|E N[rusrRrAt cusromERs oF IDAHo Polt ER - s Erblbit No.307
rPc-E-l1.0E
Readlng ICIP
Pagc 5
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE ANDiOR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 94
\i
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
rrcf,Amrrailrra*rrrrolll!t tt ftt
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I udtco bdalf of ruy.c[mt ftsldrutid C!*mrrsofldeho Pqcns ftCIP), rtgsdirgld.ho
Plorrcr'i ffirlc t9 trifrftcility €hrgs, ntich fu dto imlud?d i! qpasbt ooffilrsE br pourcr
salos abow lb Selodr& l g udfr limit I lcft yor a ncssage Fgdi[g {ds mffi ti: uesk, hrt ur
seo{iug bb te b filty,fld ry dicd's 0@G in hrycs of Ebiug a ryccdy rEsihilim bftisnrc.
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Idaho nou,rdr Sc,hdulc 19 EifiimtdEc lldliric st-TB wtioh sucs s Slto*r:
FASLrIIESFBYo}{D THE PIOINT OF DE!.rVERY
At thc option of ths Coryrry, tofiryrrs od otm
facilitico insallod bcyond thc Poiil of Dslivcry to prcridcd
Ptimy a Trmisrfon Scrviia rnry b ou'd, opcreE Btd
ndE&d by ths C@pey in ooddcraim of frc 6\rsbqra
prylry a Fuilities Ct BE to thc Compotry.
C@DE -owncd FaciHticc Bcyud thc poid of Ddivcrysi[ ba $t ftr6 in a Diruibnnio F.ciElicl Imtsctnlot Bcport
plovirdd b &e CllrtomGr. As ltc Coryrry's intcstmat in
F*ilftios Bsyod tb Poin of Ddirrry ct@p! in odlr b @vidc
ttc Glubtrrcr'c sarie requirtmoG, lfue Conpuy shalt nod$ the
Erhlblt No.3(n
tPc-E-lI-{tE
Reailtng ICIP
Prge 5
Page 95
Ir&.WdhJuty30,20l0 \
rue2
Ctrstmco of thc ei&lidons ud/o ddaims of facilitie by
filErdirg to fic C\smct a rwiscd Diguibuion Facitities
IrvceMR4otrt
o reinsall or chqfc Cqlry.omad Fasl$ties Bcyud fu Poinr
of Delirrqy, te Cus6mcr sffil pay to thc Cmpeuy fu 10oB'
*hnbtc oo6t' of $Gh rrmord, rcinshlldim u c,hrga Non-
srtrnble @* auua U.cio is coryisod of lt ffiil derud&d
oors of ocid6 l&or ad owrtcrds of fts fesiffthl, lcr! thcditftrc bctxm ltc s*rSh ooc of ueid noorrod ad
rooval lrtor mat including Wlpitr ovqtcd oo$$.
Thocurrcmly altorizcdnodilyehfahfteraifiis*&eG. oryrny's irvcffisrtinCoryany.
oumd Faciliticr Bqord the Poid of Dclivcty timcs l.? pcrccuf'- uftich dds rry to o annual
clrgc of 20.{ % ofl&ho Povtr's id&linvcsm. Iniu*hl cu*omcrs do norrpally ply ofi
te inrreamcot in &c facilitic+ md as mitt o in ts urifrftcy cminrr paying 20.4 % auurlly
oa tLc inithl invcmmcc wi& o pnovision fu a dcprccidion of thc rnluc oftt* inrcanscd ovcr
tirnG. ID onhGr uordl, for r $10,fi10 imiemat in a piccc of oquipmcm by ldrho Powr ti lgn ,
Itc fuge trcsrme tLc equi1n:ut.at ieerc r!0&s ils Sl0,m0 rnhn ttirty-thrue ycm larr in
20tQ u0 6cgps tLo rano 32,0{0 c[ngc ffilly in y=ar thirty-thgo as in ycr uc" .Onc of
ICIP'g ncmbag J.R. $iryl* Co., nccotly oonfimcd thrt it wus hdood sti[ bcing chrgcd 20.4
Or rcsesrh a tte Comrnrission idicc rhdthis ecility chrsp rvas calcutaod rmy bcck in thc
Eid-lgS(b, sd rytrurcd in Casc No. U-Iffie2$. We obtuinql Idaho powr's urcrt prycrs
sryortiggihG calcnlaion in'fut crpq ad I havc orched 6c rnost us.firl pordms b tris latq.
As,rou eu soe tom:lhc qd pqctr, td6o Poc,Er cabrrlecd s av@gp of its inr,€$E ili in
6c* hcilitics ou &c prs t9t5 sEd l9t6 (o page 5 af tT), rod thsn (r ttrxm on thc.
mmrr,, pigF) caloulilod out rnd.sunrmcd tc pcrmlryc of several f*i[ty:rdaFd srpcits
ftr$,tichldahoPowrtbclicrrcatitrascntttedoncorrcrftouctmcrs. lltogciminchd.d
chu$s o fu an*mer fo dqr*idio, ilomr tucs, p6oE6ty tucs, o6E( larcs, opcouiu aod
nrqlntcumm, adnlnimuirrc end gBnra'rl !rctiug cryiul md insurance, as upll as thc
Corya!7's t[ca'adronizcd 9.W2 % rc of tanttn tlfulcty" Idaho Porrcr anirrcd at thc
rmrul pcrccmago of 20.{t3 % oflhc initial frcility invcnnent
ICIFIFcltion
ICltr bGtfovcs ftd &ie ffilitics @ge of 1.? % nodly is m hlgg e frir, juEt, ud rcasoubh
chlEe, and pqucstr tst ldsho Pffi alrco b rEduce the ndhly chrgc aud pr,ovide custfffi
wilh fu qrim of psybg offthc ruining intrid coas of Cuapqy-ouaed frdilitics.
Fir*, our rcscasch ildices trt the 1.7 % moathty 6uge cskuldcd in the mi&.1980r is sinply
too bi& bGodno tLc iEDrrB have chmged ovrr tioc. Fm otuplc Idaho Pom's aitoriad ratc
ofrconri ffrom its 2008 g!ilcilIiltc calo ic now mly t:lt 7o - llf|Zo/o l€ss &E itrcludpd h rhi
Erhtblt No.307
rPc-E-lr{s
Rerdlng ICIP
Page 7
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER TNTO EVIDENCE.
Exhibit 8-B
Page 96
f&. Wdtlr
Jrrly 3Q 2010
Page 3
fidlitils eilgo. Ard fim lddb ndq'r 2009 Dodael Errr5r Rsguldory Co@irsion foro
l, we co Ell ltit rrmud pacffigH fo qlldon d nriffincc od for.admilgdirrc and
gGacr.l Ehtld dccmorc by a ml of 2.62E % frm tosG ir 6c mt Eitr lt€so it@
ttonc odl for a murl paqo chE& durllc by 3.754S ?( o rypryximly 161?8 yo
unrullr, or 1.3fi % ooathly
Addifionrlly, ICtrP bdicvo te dQrtciri.m cnrp b r@trmtblc. Rtgsdlc$ of ufrat thc casc
rrrry blw b6 ir tta Eid-t9t0$ the Comirdon cuncofly rcqufoca ld8b Dourcr to E{rce thc
fiffud of lU inru+nco by a dryesi*io frctor if tfto istrcdoom is oc fG uftich 6c
CmEoE, qrs.s rcfrm. In dB uordq thc Cmisim doos not ty,tricdty allow ldaho Pourn
to qhrle thc @lril rsc m thc ruc @ded stsd ffi tinp b*u$.l[c vdue of tbe
irvc!6.d doctcrsei oq tilrc-; Tb exiidtrg idrtirl moility dsBe uochrnico imlrrdcs a
0.560 % @ual chr$ to lhc crrst@ frr tqrccim,uf ht it doec rot rcduce ttc Firdpat eoo
t!frich fu mpili&rc[rgc is oalculAcd ovrr tinc. To hcyc susM€Es coinrrcpayiry iffiu the Lfiiel ccpftrl inscgtud - such rs Stnplot's fusifitics d*h8 hcL to t977 - lqg efrsr
oFirafi,m of ttc Arccmm do&lo rdlid (be it fifuGq or tnlnty ysEB c s@o. dhcr
&naim of crat ltn dAnddm) tu sfogly qiod ad udh.
Abovc all, brruve, &e Qoopoy fuirld idum *rtorcr- r+tonrt cach rinc it insalls
ftdlifiolsnbictmd&chelgc hrolt{cusnffi arc arrrethcyarc rlgnbgom rtlh6 isrtin
to rrl mgrfry iffist @ fu fia,ihies nriiminod by &frho Pora, and cboutd dlorr
cusbmilB to pEy offlho fifl vahlc b eroid autsry srrh pryucma h dbt umds, I(xP
rcqucs6 er[ ctrstmErs bG inforryd oflho lcrru oftc rlharg! d tE timo lhc frcility is placod onlot dnc {tts oe. Aod lhG Compey shrM also prqvi@ ril infmn cononorr o{, a righ
to of o[ of tte firll frcilitior chrrgc by payrng &wn runainiag initiat co*c rod pqring thc
ConEq' a rrasoirbh &c for tG tinc and nmcrlelr to mntrtrh'Se Adidos. llcsc option:fuld bc ayeihblc fu csichg ffitiloc m cuilmpn' preofuos aEd fu frailities fut nay bc
insEllsdiathafttup
Cd&r
On bef dICIP, I heG frd tbc is nfuld in tls Icttsr cm bo rcshrcd in a mludly rgmeh
fteim, Fnd cst in r.ffr od rcaroslc hdffiEc clrryc. I rypedau yun cmidmim of ec
mlttsr ud hok forquil b E*tiqg qdh pr rqsding it in iho osr fitrc.
Vcrytnrlyyouq),fl1,
PacrfurdmoAery ftr fic Ine$id C\umcrs of ldrho Powr
Ihn Sqtsvaol, Le Sinplot Co.
IhnRrding
ErhlbttNo 307
IPC-E-rl{t
ReadtngICIP
Pege 8
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 97
--
Erhlbft No.307
IPC.E.II.{IE
Reerllng ICIP
Page 9
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibir 8-B
rmrrmEE{}cllr*t
.rrrorirrt rt ta,
Iel: l!1.9t!-?l0o Fr* l0l-ltt-?lol
?.O. tu rllt Lhr, lD lt !, . trt ll, ?dr &. tot , tD t rO
Docmbcr3O2010
V'bU.S.NtiIgrd,hd
IbuovanE Welk
IdehoFoumCqoy
P.O. Box 70
Boile, Idalto &t707-fi)70
[e-mail]
Rs: IdrLo norc'rFrflitcr CtnrgrforlugcPtowcrendSpcchlCofrrct Qilourrl
DcrDonovan:
I rrlric m bdeEof rny fin's clicm, rte htuthl fuers of ldrho Poultr ("!CP} repdhg
Idrho Pourcr's Sdcfulo 19 Eififidlity chgq rrti& b aho inAnhrt in Aocirl coo[rce fG
poulcr salcs Sorrc tb Sctcfrle 19 tdfrlimit fisq I would li}e b ttstrl( !,uu Ed thc oftlr ld&o
Powr ropucdtirrcs frrrcliryrie nysclf, Don Stficvut, trrd [h. Dm Readhg ryding ec
chrye m l)ffiilrr 2S,20IO Wc ryaio l&ho Porrcr's oodimod witlingrc to attcm6t
$ro* ortr th fugr6 niicd in on lc,uc b yorr drbd trrly 30, 2010. I wi[ srmdElhe *anrs of qn
dimsfom rs I urdcr*aql &cn
J.n Fh,4qt Corprlv nqgnFt
AswDdisrrc$d,d&istne, otICIPumber-ltcJ.R SimplotCo.- isinuecod inorcrcistng
th o$im of omine aU ficilitics bc!,ud tbo Boiil of Uirrury for smc or dl of is Scbdulc 19 or
Spcoid Coftrot flffi dfu8 elcticrg, srkr from l&ho hwcr. Pkasc oilildcr this ktu a
flnuat ,tqucs tr trc drylded bo* valrE Erho Porrr uould chzge fc SiEElot b ta&p
owus*ie of facilitics bctood thc Poill of ddivcr!, d ca& of fu Siqplot PrcmisEB orredy
srlicct to Idsho Powa's ficilitkr &tBE, ad plcase ugpirc tb coan tD' Siqfot lcaiou
Si@t uill bc n ldng flmortial dotfsims fu thc Ht ycr in li: ooning mootrs, s rcooiving
tdOo pourcfs m* iofmaim by thc cnd of Jmury 20tl is oddcat b itt d,ility to makc a
dci.dm fu fu cornry pr. In ordc b m*o ttis docirioo, Sthplc uould dso Etc a cop of the
Conpmy'rinruuepolicytutoovcntlpCorymyomdfrci[ticf bstDtrdthcfoiilofdelintry.
edditioully,l udasud&atMr. Sunevdnqncsndtltldaho Pormofficidsooo&m ar audit
of tc ftciliries inchdcd on tb fuilitics chrgc for cadr Simplot locaim, Ed lhcrcby i.tlriliry thc
Page 98
\./
Mr. Dmvaf,Idkcr
Dccobcr3O2010
PEgG2
pstoila plccec of oqrfoma ftr ufiich ld*o Puurcr is erradrg &c &cilitio chrrSc. Sinplot
wuld likc to fnour uftco it ca Glpoc3 6t o@ctfrn ofth afrt to cnsre tld all of tho ftcititics
irctudedonths Dioribution Faciliticc trve$hm Rrpots for Simplot pnmiscs rt still in frctin
ltsc d Simplot trloisGs. eoc rrccirc4 Si@ot muld likc to walk thoqh.cach fscility in
eady rying; idcntifring cacL piocc of oquipord udfr ra ldrho Porvcr $ptsGmdive.
fmnord dlon n Trriltr.qrc
h reryw b u disqudm+ Ie Porr is @dy rog1gld in mrhfuiry tto 1.7?6 noffily
ftsiliticl chgc uith Wed iffirurtion frm td uld h 1986 t initidly crtqildc 0Et
Pcroartrya We qccod bttros ld&o Forcfr rwpcrurtsge by eo Gd of20l0, brtyou srard
u,s ry not hrc ftd crh{dq ff ilotcr nod. We looli ftnwd b sr€bg &G rccalculatd
pcrEcohgE
Also, u qrmodhg on Ofibcr ll, 2010, wG disquse.t 6e pmgihitity of inuituting tso rltcmstive
eruElmGdBO thcCoamy.outncphip no{d cobodied b & cmtd Sc&cdnlc 19 Uifr. I&ho
PosT opcssGd cffi sift a nid orumship oo&l fu ficifitics bEyCIrd fu poid of ddiwy.
Ittr, fu tmd rlEorive tre dirqrsdUas I orrcoururlipnodd $hcftbytlcrustoma
wttld peyldahoPuwerfstlr aarcomoAto*rnhr ofthecxi*inggquipmatuthc cu$omeds
trlnislE fimncr, 6l culimcr multi be rcfruitile frr dl qcr*im qd naimnoc of
fidltrGs bGJEdd fu fom of &livay, md for cquiritim ud ma@c of aay equipcntHd intlc ffure. Idaho Powr wu{dno &nry chugc sud orstm.c! e&cilitie chugc.
Tbc lhird altanatiw *t discralFd ums'a hl,trid attrutiw urt;rcW ths crroomcr wqrld nr&e g
Dclmcd fu tc ceital netrc oftb cqufrpn, hrthc CgW rrroutd rlilt om te equf,BruEt ed
mfrIct opcruiffi ud nrire" Ite Cupuy nrntd rsrcss only a linirod &citirica e.hugp
uilticfiwould Eothlrdl tlr Uptm mpurc&of thc c,hg!-ru drmm, drprccitim, md
imEE tnccs. Omat dscting t& opdm *u{d tffic pry arcdrrced foililies chrp.
Atorruingfrisu,Ek, !&ho Porrcrgaorl it is no loopr iffiE$ld iD oftiqg thc eirrl qdm,
ht w dimsscd cur"g'lg tE lsgugp i! thG ffito *qrncty rtflcct fic $cqrd oFim. ThB
smnnt Eiff logrlrge suhs, 'W ib. ryilM d tb Cryv: ih CoupEnU may om thc
cqdDqcot ad asocs fu ftcilfics dEge, tnd th triff conuihi Do cxpEss dght for ee
wroprl,. to elect to Gytr ud maintdn all $rcl frcilitiec u o prrrclrse Conpoyowacd
ftcitities u dcprccitd book vrhr. {le apprtdde ldaho Fowrr's lrccition thrt it o,ftrs a
cufiorclqrlmcrs[h oflou m dl Sc.hs&rle, 19 curbmcrs aE a Estm of Cqpany policy, but uE
bcliwc ttc tuift$oulrt ruflcct tHs option. tCp ppoccs ldrto Powcr includc tlre mo{ficdims
Uo*in ir qt rlE * filirry (chmgB in bold):
TA(ILTJES BEYOTIID mq- POINT OF pELItfERY
Ito Cubncr hlr frc trlt to om rnd mehreln rll
&cilirio Bryod 6o Soht of lDdvory. e*+oOffemt+ogonfqfl\|itn wrffico coucot of tc Cur0omcn Uangforners
ErtrlbttNo.307
IPC-8.1l{E
Rr.dlng,ICIP
Prge l0
J..R, SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 99
Mr. Dmovrntrldkcr
Dcccnrbcr 30,2010
PegB3
ud othcr frcilidcs itrrtilld boyod tho Point of Delivcry to
providcd Hinrry or Tiaurirdm S.rvioe mey be oumc(
opcfiilGd, od mrimired by te Coufcnlr in mnsidcrdio.of tho
Cutom prying a Frililicr Chrrgo o thc Company.
Coryany.oumse Facilitics Bcyosd thc Poitrt of t}clivstr
will bo rct for& in a Di*ibutim Faci[tics lwcstucot ncport
pvidod o &c C\r*m. Ar thc Conpuy'a imtcsfriclt in
ficili& BGJ,oEd tc Poim of Ddlvcty enm$E ir otdcr f providc
the Gstoncr'c $rvie rtqufumcot$ thc Qmpany &stl m{ry the
CTstoffis of lbt addfitionr od/o ddaiour of ecilitfuE by
foruauding to lhc G\rsomcr a rcvirod DiOibUton Frcilitics
IavestudRcput
h CIc lDtrlhdo! frdX6rr hvcdnrqt Rrpo6 ttc
Cornpry'ttil hM€ tG dtflrclilcd booh illnc olConpmy-
onaod fidfrn€ rnd fuhdo loffce o[6G oppctuulg for l[eCtmcr 0o pur0ro dt Conprycrd fuilifa Bryocd
eG Poffi of Ddhuy rt tr dqrtdrbd boo&, vrlua Thc
Corpry rv[ notrrirrtcfrd[ftt Chrr& to'tr Cfodocr
r{llrmrcrrhiptndor
In the crcm thc Curm r@ ec Conpoyto rrloovs
or rcinstrll or drryc Cmpqyoumod fd[fu Ecyfid tbp Poiut
of Delivcry tvttort tr Ctrioror dq orucr,rQ of thc
Frc0ffGt fu Gh*omcr rhalt pry b lhc Corymy ltG "mtr
salvrble oosfl of qrch nmovrl, rtluuttGm ol cfiarlg. Nm-. $hnblc oost aE usod htrth h onprisd of tb tohl aercclatc0
oocts of Ertthls, lebor od orcrhcrdr of rhe fniElic* lccs thc
diftrcrrc bctwa tlr ldvalDb cosr of rldahl morrcd ud
Eoornt l$or cod irchrding appier orcdrcad cocts.
We rtrno bcliwe lbd ldaho PuE Smld ccrd a lGillr b r[c mergcc of crh lugo pourur ud
qpodd cffict ors@ hcolfoo tnmdy bcin8 Hlbd fu ficilitios chrgps' Ilhtrh ldrho P,ovu
fully orphirc tb ctrgc, imluding e dmi6ion of fu dEgE s oompocnts ad the Ftal mu.t
paymtfiom&eeuctm,
Couffm
Ttmk pu rgnin fsr ldebo Forlr's cominucd efrodg b wod( tower& a mnualty beocficid
recohtim ofthisner. If yur harc ry qtnfim'plca* oonfiact rc.
ErhibttNo.307
rBc-E-lr-0E
Reedtng ICIP
Page ll
J. R. STMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 100
ldr.Dmovmf,tdkcr
Dcenba 30,2010
.PaSG4
,.)
OqryAihnr
enaacy ftr ttc Indumiol Ctms of ldio Pourr
oc: hi&ll0rcofHlhoknrcrllmbaCqador
Ih. DmB;rdtrB
J. R. SIMPLOT COMPANY'S MOTION TOTAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
ExhlbttNo.3llT
rPc.E-lr"08
lcatltng ICIP
Page 12
Page l0l
SEHE
rnDlcfitstro0rw
Dffi'AIIEWAJ(]HlrnbrCqlrl
Jamnry3t,2011
GngoryM: Adamc
RIOIIARDSON & OLSRY. PLLC
515 t{ortr Zen Srsd
P.O. Box 7218
Bolr, ldaho SS)702
Re; J.R. Slnplqt Cmparfis Roqucst b Pufiaeo ldaho Poyrpr Gompary
Factiha
DmrMr. Adams:
Tttr leser napode b tlre Desnbr 30, 2010, lefter sant by yuu on behalf d tre
lndu&lal Qustomeo of Eaho Forrer (itGlP), arrd nura seadhry, J.R Simplot
Company fiShuld), as r€ll as the faebh moe[rq we harl on Dsocnrber 27,
2010. As titrr ell of the lClP cudomea, Edto Foner vahps its builn€ss rdatonsf&
uuffi Simplot ard mnb to uott u,lh fr on resolvlng any @noorns or lsgues nlated to tte
eenfue Haho Fouwr ptovlrhs. That 081d, trB rccpom b nececsay b chlry klaho
Potflor Oompqnyc (Id.tro Fqref) positon on oelbln mattens thd rus dts uttcd uuiU!
you at thc Deerter 27, 2010, tnsotrg o llut you tuve dear erysctafibns u b wtrd
ldaho Porcru,tl agrte b do h tegqdr b your rcquffi
Ft{, as taSrcffi by you h your Dcsnbcr 30, Z}tO, l&r, ldaho Forcr $n
pnvlde Smplol prppoldd'bqf:ouf prhes, by Sirplot plart loca0ons rcetvlry pdmary
$nloe. br atr ftoit[ee owned snd opdttd by ldafto Porprthat an locabd on the
Slmph alde of fte Fdnt of llcllwry. As rue ersad, ldaho Furer.rfl bc ppparod b
orlier a frlr rsltd value prtoo d [E fadfltbs ae dcileq{tn€d by ldaho Fower, not tto
d+redated book vdue prho. Bdt lddro Forer's qgnrlabry anO nmrre depaffienB
ate buay pmpailrU thb lrftmilon, ad ldaho Fompr wifl provlde lt b yqy one ft ls
oady. At tl{e t[ne, ldafip Porcrarffdpatee that it u,fll ha,B mmdtEtg avall*te b you
by mil-trlanh-
tn additlorf in th€ evon[ ldaho Ponsr afl€s b Bell thcre faclltee b Slmplot
ldaho Pormr wlll mod llksly need b ins0all ddltloml protacton equhrnont oh trc
faclffes on fiG ldaho Poruer slde of the nriler that fteds tte Slrnplot bcations. thb
ddltbnal equlpnent wlll b6 noqffisry fur system megrfty and pllablllty pupoees;
lr+luiin'Ui
rrzr w rthrfr{llWJ307
[[ji'$gru-rroeReadlngiICIP
Page 13
J. R. STMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 102
i)
Grryry M. Adamg
.hnury 31 , 20l l
FegE 2of 3
Cuirenty, ldalp Psffi arilsfrcthat ltwlll prot He yourc{ent nittr a nron cpeclflc lht
of thc r€o!!.ary ryrftem equlprtilt npgpdc by n{&ttladr r yrdl. klaho Forer wi$
lefi you krcw il it h gohg b be unable b Fuvlrh youufh sfficrttls ffimE0on or.fte
pddng inbmatbn by mts-irarch.
Scmnd, l&lp Fomrff do€s rpt lwe s[ocmc huenco polds nfl& ;r0omparFwmd ffil[€! bq,o]rd fie poht d &liuqy.' Uke.msd bue[wes, ldaho
Pouuar ttas bmad, gsneral lhbmy polldea rrffdr cowr.wrtrus aspects of iB hrsinese.
lngurlrp ldalr Fouef agahd prcperty damago, accfilgnB, anrl otrer loos. As we
ryhln€d vrhen ue fnd rflft you ln Deocm[er, erdr poftie do rd ovw .agdnst
oquFmenttrd must be rcplaoed fu I ?us leecfied fie eil of its uedJ [b, orbrlhe
nplacomen[ of oquhrtnt fiet ffb afrer he €Srathn of ths manuHuuds wamanty.
ThE, ldaho Pounr luc oormletEd lhctiles arsesstrpntt lbr tight of tre nine
S[npk[ locat0m curwtty opp@ utldgr ldaho Fqil#s f*IlUe8 dtaEp hilfi
povlgbns. The ases.nbril metlndology, uullch lnctrtee lbdlitlc inWrrcil leportg
and mapSng by plant locetlon, urEre lemnty rcvlswod arrd apgoved by t)ron
Slrndaant ai SlmRtot (ses encbsuru). ldaho Forcr antclpatea corpletry the faclftiee
asseaotiant fur Ute frnal bcdon, ft€ Slrpht Pocamflo lbnn locatbr, by tte otd of
Febmry. Onoe ldaho Forur complelec all the facffisc Ssemsrth, it wll m€ot witt
Slmdol to dlscusq as uall at eatsblFh, a schedrde to mndtrcl physlcal, ondte
e8o€sstnenb atthe Slmpld bcatong
. Forrllt, Eg 8 hrglness rrer and as disomsed. ldaho Fow wl[ not mdntaln
lbdlfiet boyord ldato Porus(s Folil of Delhnry thd are oryn€d by third partles,
ltllorpow[ tf lda]o Porror hdffio! arc tanrfcned tp lhffi pwtles end prmved fum
Haho Fourrt outrrem&, them wlfi be m oppoilrmtyforfioee ftdlltes b be rctumd
b khho Poupdsq,&mforHaho Forisb ogerab and ndrfiin Rndfrrtrily, oilr
Slmplot or any other omtonrr punlrares ldaho Forr€r faclltles, that ousbmer wlll be
tutrolly rssponsith for opemtirq and maintrir{ng tlpco ftdll[€s on a golngrbrward
basi& Any osrnstrat ffi b pnnfiree $chfad[tes Wll rut haw the abliU at aHr data b hantrr $oge fiacNfl0c bact to lrlaho Powr b mdntaln ard 'operetg. One
fiangfsrrd, trlaho Folrer wlll lrarrc rc resporulbllily, or llablllU, assodabd u,tth
malntalnlng ldwnffiss of hoeo lHlltbe or tsllun or offier olemtlonal 0r minbnmoe
hsr&B aEdodatod wlh those lbdllb, rcr rnil ldalr Forcr be luflondlrle or lhble br
arU comequenUat, spoohl, or ofier damagm, hdrding loss of productlon:and bst
prof,ts, ffrat 6dd rgdt ln addltion, ln lhe ewnt ldaho Foruof agrces b sell any
hdtUee locebd on lhe Smot side of the poht d tlo[very, I will ]reed approral fiorrn
the ldaho Publlc lJffites Commislon ('lPUg) puruant b ldaho Godo S 0t€20 prlorto
harnfsnlm 0!e fadts€g. ldam Forer wlfl llkely need your sppoil and oooperdion ln
makfB 0ratfrfing$ltr flte IPUC.
Flffr, s re digcusssd d lengm, hs odsmg britr hrUnrage ddrcsgtu fadfitcs
cherye prwlebns ls srlfident and adequdely descrDee fte Fadmh Chaqe. As tti0t
Erlrtblt No. 3l]7
rPc-E-il-08
Rerdlng ICIP
Pege 14
Prge 103J. R, SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Grryry M. Ad{ns
Jamnry31, AI1
any reguhed puUh rfifty, oumenhflp and msponsbifity frr eqrdpmcnt erd fuilrues
be!,ond ttp rrtlffr Foht of Defilrery le, ry d*ufr, rrrffir fB qHots. Artendhg the
Wm hrgrry. G propoced h your |ffi, nuy potoffial[ cau$ nrtu ptoblutB et$
antftuly t]nn lt wurld ruihrB, ard b mt nmclary. lliolsw, aa tlr atblrpy
lepmseilhg tro IOP qnDnErli you era vcry wsl! amn d ldeho- Foupde[ffip*0on of SdNedule t0 a ndl u filaho Futtrs po[cy e[ou'[tg Sdtodde 19
ortonprs b purftme. otrn, ald openb ldaho FoH bcfrUes hcatod on tne
clrsffinsr's lHc of hc Foh[ d D*rsy. Tlptdore, sendkq rut htblr b all IOP
clffimen lnbmlng hem of thia lrfrrpffiafiOn ard pdlsy muld be rduldan and
unneoglSary..
Sirmrdy,Mzil*L
Domvan E. Waller
DEW:csb
Endosuos
ErhlbttNoil0T
IPC.E.U{B
Ree&gICIP
Pege 15
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 104
GnoAdrrm
Frcm;
Sent:
To:
Co:
8uU.GG
Gtug,
Wil[amq Jam pllllffirm0ldatmpotrsr.aoml
llllqlnradry, April 06, 2fi I 3:6t PM
GrugAdama
Dm Redlng
RE: Snnpbt lbcilltct disarrhn
Afiar lnbmd disausslon, re h$,s deddod lhat m wuld rether dbcms the enfre bsue wttt ygurffi, as, fiom our paspecffue, thb b not abqrt pdoe. As I lharcd wl[r you ye€ilBlday, as a poltcy
matbr, ltlaho Pousr h* decUed lt ie nd Solng to ss$ fte fiicifilbr b Slrpbt The ftciors that rucnt
into hat daclslon arE: 1) our fi[ubry obllgathn (61€28) b hdrl dlra cugtomer hamEss in eelllrg
utillty fi,nod asssts: erd 2) tlu rury rue run our hpinm a a regulated public utlll$. So while we can
go owrthe buy-out piloe rncthodohgywe nn h analyzing Stonplofs taquest fiat mdhodology and
the Earnanfi pnce dfimably had llt0e beadng on ldaho Porrer's decision to not sell ttosefacititos. At
ttis point, debalhg lhe priao mdhodobgy re uscd as part of thie analysis would not be Brcduc{iw *
it wlll not impaat $e decbion u,€ hare alrcady made.
'.
:fhanks,
Jaaon
l-cnHlhm!
r lrtrlroPoncrCompary
tlzclrgasro+
Eom; 6rq Aduns Imelb:Greo0dcharhonarrdoleep.onl
StG WUdneslay, Apl|06,20119:16 A!,1
llDt Wllrmsr lerB: Dcr R:adrp
Jaron,
Thanls 6r lettint us know about tha pmUcm ldaho Power encountered ln calarla0ng the amornt that ldaho Povyer
would need b cfia6e Slmpht frr entstlry faclllties, bcyord tlrc polnt of tfic meter to l{ corer the book rnlue of the
fadllths, or (21 kaep the drer Sdrcdule 19 cwtomerswtrole.
After dlscuss{rg tlre lsue wlth our consuhant, Ibn Readlry we wcre wondcrlng if you could please serd us ttre rrcr*
Fplrs assodated wlth your investigatlon ln advance of our meerUng Morday? Ihat would enable ts to hare a more
substantive discusslon.
Thanksa@n
:
CilcgAdams
Richsdsm& OT,Gry PLLC
5l5N.27lhStuocg t37V2
P.O. Bdr( 7218,8?707
Boiso,Idato
Voioq: 208.9382236 EhtbttNo.307
lPGE"ll-08
Rerdlng ICIP
Pagc 16
.,. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 105
Faceinilc: 20t.93 8.7904
InftrurirncomhcdinOiroho'hmicns*rgeudinoyu*mhwtomycoelnhftrtrdm0tirsmfifuti{F@gt d
by&c rlbrooy/oltcutplvllopmd/o!!filcy urortpoduatdoofiba Ttbqdl tr i4rdGd@lyfu&gusr oftoindfti*halc
G@ nM $orn hnhlumt dbcloau! of tlre como of tfu orll'u in 6.6 5 'nimodd rcipirns is mt iutmdGd ti
oud docc mt c@sthrG a rrydvu of&c afoncy/dhot Fivf,gE md/c rlbnsy vm* poduct doctila Ttrh tuoigsim is ftirthcr
corurd by lhr Elscnrmlc Coonuido Prlvry Ast I t U.S.C. S0 25 1G252 I .
If yur hrvc rccfircd ftls oortl b cnur, imdi&.ly aoti& thc rcndr ofltc cnuoors rccttpt rnd defioy ftis rrnrlt afl Eyudbucotofts rmccittcrclccEonh orpired. Anydiaclmne, dliscnido, dfutihnioNt oopyhgcnso ofto cffi or
hfumftn rcqcivcd ia cmc is saiotly prdibed.
ltdryon.
Fom: tttllhmg,llson
Sultr Tudry, ADdl 05, 2011 12:25 Pl,l
ltu GrqAdrmeft$€r Shplot hdllUs dbalsslon
Gttg,
As a tcllourup to our dlscueslon of lastvmk, ldaho Power has made a dcEmlnaliln reldrq b ttre
iats of Schedule 10 hdilcs ftr Simplot. We would lll<e b invite you and rupnrsonffivct of Slmplot b
mset ruih our fullte b discuss. We ould be evailable at ldaho ForGfs downtos'n ffices on either
tondry, Aprll ll et ll em or Ftlden Apil f E et ll rm.
Pleffie let me know if eithar of those Umes work fur you md Sknplot. lf so, I can gfuc you a oall and
wa can dlscuss an agenda b mah surc rw oortr swn1thlrq that Slmplot has asked.
Thanks,
Jason
Mr lifilnn I Corpor*e Cornrel I ldrtro Po*er Comprny
1221 Ur. ldehq Bobc, lD 837112 | t(2tr1 38 5lO{ | El Mltams0idahoroucr.com
rt[tFilrrdoEryo0h iffio0tlFvdhlld,dfid.l d,C@ frEehrc r**eldoln trrorl{GdbMnS4 pr!!EttyffilEnydhdouq,oWytf drtlqcuo(io.6l&eE!iltrrit(bd&3uyrdhoohu)blIIRlctLY!R(trXE[I@.IfyotttedrC6ffiocbeu. dartuldoryd.lft *!dd.ey6.drliritrolircly,ddcbffi cHcrytu lr*yur.
Erblbft No.307
rPc-E-ll{lt
Rcadhg ICIP
Page l7
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
\
i)
BEBORE THE
IDAHO PIIBLIC UTILITIES COMMISSION
cAsE NO.IRC-E-1148
NDUSIRIAL CUSIOIUERS OT' IDAEO BOTYER
nEAIIING,Itr
TDSTIMOIl{Y
ETHIBIT NO.3O8
.
Idaho Power's Reoponrec to Produc{ion Rcquot No* 12 and 51, and i
Corresllondonce Reg[ding eRcmovd' of Facilitico Charge
Equipment
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
oFFICIAL NortcE altDion oFFER INTo EVIDENCE.
Exhibit 8-B
Pege I0?
IG,OITEST FOR FODUCilOil fO. t2: Ih€6 tlre Company puvide flstonrus
pa$ng the faffies charge witr any optbn b errur ctop paylng tlre fadfi0ea clraqs, and
acqulrc rnd ontml thslr own aqdpmqrt on their orn pmperty? lf o, please ldeffiry
thq t4guage ln thc eilcdrg or pmposed tarltr hwghting thb opUon lbr cwtomer. aid
opkiln trow trb plom milts. Flrse hchfrle €rplanatlon of llr bnglh of Snrq il
wotdd talo ltldto Porcr to povlde custonur n'lth a calculrllon of the ost br the
cuslomer b pay tOatro pmnr b mmoro tha farilitier and stop paying the ladlitier
durge. Slnce 1g8?, lrw many curlomets haw (f) hqulrod lrfio $h optlon, (2)
ercdsed lhb o&n?
REsOilsF TO REOT E$T FOtIlrRODUCTl9il ilOJ3r Gustomsru paylng e
frdlltEe cfiarge can rE$relt that he Compary Emo\ro d of ib facfftlee locahd on ihe
cu$omefs proporU. lnthls eate, tho cusmormuH no lotrgerpaya rpntHyftcillteg
dtaqo frer all faolltec sbn rurnvud and all rumornl fees worc pafrl. All su&mers
oan rcquct nmoyale, rsbcations, upgndes, or onverulons svltrout sps@ qdtr
lrynrage ltrdlcallru that they can malte srclr a request
Tho lerryfi of [m il trcdd hfto l&ho Poner to pmvldg crrsof,rqp with a
cdculdon of fig cost fur [te cusbnpr to py ldalp Power b rcorow Ure lbdlfng and
@ pa$ru tho hclflfi€B dtalge wlllwy baeed on tln slte onf,gra$on and fie number
of fadmb bofrg lemved. Ths Compary doc not tradt the nur&er of qrfiorrrB thct
luve tlqulrcd lnQ thb @m ormrdsed ttrh oflhn.
The r@onse (o ttris RsquoC ms pnpnrcd by Smtt D. $padq Senbr
Rsguhbry AnaW; ldaho Forcr Company, ln oonsufiaton nrllh Jason B. Wllhms,
Corporate Couneel, ldetp Parnr Gompany.
lDAt{O F(mrER @tlPAlrlYS RESFOI,ISE TO T}lE SCS{D REOUESTS
FOR PROIXJSNSI OF fiE INDIETRIAL CUsTT'IffiRs OF IOAHO FOIVER . t 3
.\
Erhlbit No.30t
IPC.E.II{8
Reedlng ICIP
Prge I
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page 108
i.)
REQIEBT FoR PRODlEllOil ]lO. 3t: Rtrance the Comparfs Responee
b lClP Requed No. 12 (gtatirU tlnttt$mm payltU a faoiltles Gtrarge can rcqued
fitail.$e Conpany rE rprle all of lh hdlfrhs hcmd on tre crntomer's properqf). Has
sqy cuctorrnr evar rqlu€Eld romoral of tE fac[i[ec bq,Dnd trc point of dsffi\reVl lf
yac, pbale adaln trow the Comparry lnclaased oilrer crsiomoll' 'ab6 ln thd
clrcumctanoo. lf no, hae tlr @mpany syarffitd b ailqv a cu&mer mrclse the
pnpval o@n ln laponre b a cusns's complatrt rqadng tre Hlltes drarge?
Pleass€ililsln.
RESFOilIF TO ffiQtEgT, F,OR PRQDUCIIOII
-ilO.
sr: (}rE crdomer has
r*cnUy (lri[rln the lad fine yean) rsqueshd pmwal of fadfiUes incfialhd beyord the
Compr,rfe polnt of dellrery. The roSr€st was fur rsmoval of turo tansfuimers. !f
tunolnrl, tre crffimo wa golrB b ln&ll, ofln, opaate, and mdnbln ils own
tmnsbmatbn. ln rcrponre b trc cuslornds requelt the Gompryry pmvldcd fie
qrfirner. a coct qt& for the Grnovd. U[fnebly, the wdomer dd not purure the
mnrowl and there was m impac{ on crstomqrchsg' rcvenue mqulrcmert or rates.
The lesponse b thb hsqrcA ruas prepared by,S6tt D. Sgarle, Senlor
Regutatory Analyst, ldelp Porpr Comparry, ln cqrqrlhtlon wltlr Jason B. Willamc,
Corporae Courd, ldaho Foria Conpany.
IDA}IO POIYER @MPA}IY8 RESFC'MIE TO THE SUfiH RE(UEsTS
FOR PfrODiTCTtON OFTHE II{DIJSTR AL CrrsrquEtrt OF DAitO POlrrrER - 12 ErhtbftNo.fllt
IPC.E-Il{t8
Readlng ICIP
Pege 2
Page.l09J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE,Exhibit 8-B
-
f,oD.mrrc&EAr
r ttot,Ilrs lt ltr
Ictt tl!41&?t00 trr: l0t.!!l.7l0r[
C.O.lor?tla lotalD irru, - tlt[Zntt].!&.lD !rr02
Augrrst2S" 20ll
VLA&UdleiltM
DoaovanW.l&!r
LiraNod*,om
Icm Willims
I&hoPowC@pmy
P.O. Box ru
Botuqldrto t37$l-fi)?0
8:: foraln S..t$rortofrffi offtcsfutrryoqQu:rtftoa J.RSiDDhtco.,prutir
_\.. .) i
Dcr t{r. Dmonm Walkc, }ds. tba Nqdshln, ad ffi. Jm Wiltiams:
I wriu ubehEofmyf,nn'sclirnq J.R- Siqlc(hnpmy, to fmdty $qlr$ tb klso Prc
povidc cort figUrca fur SiaphO currcire its'igl't rudcr the qlplidlc taift d SFcisl
Coar*t to haw ldqho Pffi movo trho dstih[ion ftoi[dor g&ic.t to Idiho P,ouE 8
tollitica chlrtg a in Sefto&rhs 9, 19 ud Spocid Cmfict hcuions. SpGcifically, thc tuift
edsleirlCorrurstallmrsi@6opey[rlahPourrtp"nm*alvrbhooeu'ofitlnotnlofth
ftoilidcsbq@dthopointofdilirruy. Ib'Nm*alrnblcoodeis"thbtil derccidcogof
qdcfik, hbqr ud ovatca& ofttc &cilities, lcss hc difrmmoc Mrrcco lho salrsbto cost of
m*crial rtooved md rmrnl bc ost fualudirg apopime ovcrhad ooitsr'
Plcarcaho insldcwiththcmovrtoctthc initlal invesMcnlintbc friliticcto bcrrmoved for
ehloction" Plcarprsvidc a[ w*papers grypordnglhc lcmovel oostl.
Simplc abo rtqrc*sftd l&ho Powr a1phfu ufifu Sinplot'sps)rnontofrcmoraal cosE, as
cOna.ru in tnc'tuim asd Specisl Coilrr$ will hcrrc a rgtc impect o oilhcr crrsm,mcr in thc
apflicrblo roe class.
Fimlly, if ldaho Ponrcr itrsludcc additioDil pmccdm Gqr{rpoGd ioshtlad m thc ld$o Porrycr
sidc of the DGEr ss prrt of rts rcmorul oocts, plaar gcDtsFly it@ir such oquipmcnt fro,ur
othcr cogts fur cach locdion, rnd plcasc orylain brr &earlfB and Spccial Coffia$ as qrroted
ErhlbltNo.3OE
rnc-E-lr-08
Rearting ICIP
Page 3
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page I l0
i.)
Itr. X/dhri lft. Xqdfrtoo, Ed I&. Willimr
August25,201l
Pegc2
rtxnrc, dloqr for inclruim of suct cm b bc Daid by Sinplot.
AffialyfoIR Stopt*Co.
oc: hothreitm,JI"SirylfiCo.n nsr Rcsfu, Bcn Joenmn asgod*cs
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
ErhlbftNo.3(B
rPc-E-r14t
ReadngICIP
Prgc {
Page lll
nEHDNrPOtEl-
mOtoofP€OftEfrr
Se$mber 13, 2011
I'IA U.S.IAIL AIID Ef,AIL
Gmgory M. Adams
RIG}IART}SON & OLEARY, PLLC
SlS llorth 27m Street
P.O. Box 7218
Bobe,ldahoE3707
Rq J.R. Slmplofs Requost br Facfitlss Removal
DearMr. Adams:
Thank you br your lefrer dabd Agust 25, m11, on bdralf of J.R. Simpbt
Company ("Sfnpbf) and youruquest frr Haho Poner cornpany fldaho Foref or
'Companf) to prcv{de coat figurac b mnorc Haho Fovw facililbs on lhe Slnplot 'sid6
of the metor.' As you are aware, wo haw m€t wlth you and Slmplot representatlves
multple tmee owr fie hst year to discnss the Companft ldaho'Rrbllc utlllths
Commbsiop ('Commbslon") appmved fadltt{ec efiargos ard tlnrc prwlded you wltr
&ftrll€d ffirnefion related to ttroee faofllsee ard drages. ln fiac't, ldslrc Po,yer spent
ltundrcds d man-houte oldtrc{ng lhdll0es a.dtu of S[r,plde locatlonr and prwftled
roporb of tloso audlt llndlnga b Simplot ldaho Fower hag aho pmvlded you wifir
volumlnouo lrfomaton rslated b tis fmllHee charge in tho form of teeponcca b
roquests fur producton that you haw submltted ln ldaho Fone/s pendlng general mte
casa at the Commlsslon, Cao No. IPC-E-11-08. ldaho Porcrwillantruo b provlde
Slmplot uffr all rdevant ffirma0on lt needs so lt can eveluate and plan for [s elec,tic
tscllltic ard sorvico rpde.
Your nbS rscant rsqued s€d{ng 'cost fturce'br.the rcmoval of ldaho Pouor-
owned datibutlon hclll0es subF&t b the ffifiths charye ls ln ltgtlf a eubsfiatthl
undertakiry. As you may be auiam. tfpre am appmxtrnatdy l,ffXl dltrBmnil pleces ofqlpmenft sprcad trrcss nine Stnpld locatlons thet aru amantly ruQfect b the
fuffteq cfiarge. ln older to bb aHe b pmvHe the mqueded oost estlmete fur the
mmoval of fadlltos, a epoclfic removd plan wllln€od b be rlerreloped fureactr Simplot
locatlon. The laryer Slmplot loca0one ruy rcqulrc mulUple ptoject plans that rBfrect
phasod uork efuits. ln oder b maintain seMoe b Slmpbt dufirg the rsnpval of
Eclll0as, ldaho Porruar and Simplot uilt nsad b haro ertbnslw mordlnatlon to ensure
rJi
li#$IBSrFilProe
rorc, ToIEGE-ll.{tr
ReedlngICIP
Poge 5
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
Page I 12
Grcgory M. Adamg
Scptentor 13,2CI11
Page 2of 2
ftathe rernoralof Gorpanyfrclltalequipnert lrc a minirnnlan lmpad as poesible
on Slmflot's busln$s opemtlona.
Amrdfqly, a thrue&p appmadr ls rcqulrcd b povlde Slmplot wlth an
aocumto ret quote b nmow Companysv666 hdfUes ftom Slmpht's''dde of the
meter.' FhBt, ldeho Fo$!r opqsorp peinnml tril need b meet u,lUt Simplot
operdons penonnd b dhcuss Slmptofs pfud[es asocialed trtlh eadt faciltty and to
dewhp plans fu pmoval. For sxample, rmoval of Comparry ffillts ard
mplacernclt nlh Slmplotourrd tsdllUos wlfl requln paffd or full outagea of sorrn
Simptot locatbrr. Se@nd, ldaho furlerenglnealng penonnelwlll neod b despn and
engher the nmoval of fufftlec ln a manner ondabnt with Slmplofs buslnees
operatlOns rpo6" AonsUem wffi fie Companfs Rule H tailfi, Slmpbt ruil be
rEtpongbb fur pnpayfg all erqheefrig cfiaEes assocffid 'Irdth de$rdng plans br
mmoval of and charyne to tho hdlltles. Flnafly, oncs the Company oompbtee the
erUtrpadrU notk necmary to derdop plam lbr Fotmyal, lt wl[ be Sle b provlde
Simddudtr a oostquote.
Pleaee iravo Simplot operationc pemowrel mntact Jim Hovda, an ldaho Povrer.
Llaior C\.srpr Replooenla$ve b oodlnate a tlme b mod to haw fte inltlal
digcr,rssion Glat€d b &vdopttg fiacill(res rcinoval plans. As you may mcall, Mr. ]iovda
has paillclpated ln our meetngs,owr tte last year and ia ftmlllar uultr Shrplot'sopentbns. Afierlhls inlfral medng, ldaho Fqrcr udll be aUe to povide Strplot trrllh an
eetimde lbr the t€qtlrsd prepayrnent of the englnearlng chaqn aesoclabd vriBr thehcillilc mrnoval phns ard cod quo@. &tco tho erElnsedrU chalges am paid, the
Company wtl proceed wlth fto erlginedng wort rcquirerl b dewbp ttn reqr,letbd coctque br removal of th€ fuc{i0€s.
Shoerely, \dm
JBW:csboc: Jlm Hovda, MaJor Customer Repnsentatlrre, ldaho Power (via e-mall)
Elonovan Waffre, Lced Comssl, ldsho Poruer (vla e.mall)
Don Stuilevafi J.R. Slmplot Company (vla U.s. Mall)
Dr. Oon Readlrg, Ben Jdrnson Assodatao (Ua U.S. Mell)
ErhibttNo.308
rPc-E-l1-0E
Reedtng ICIP
Pogc 6
Prge I 13J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 8-B
EXHIBIT #9
J. R. SIMPLOT COMPANY'S MOTION TO
TAKE OFFICIAL NOTICE AND/OR OFFER
TNTO EVIDENCE
I 12051lafn. txt
15 uadam chairman. rhe tndustria'l customers of rdaho Power
16 calls Don Sturtevant to the stand.
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CSB REPORTING(208) 890-5198
451 READTNG (com)
ICIP
1 DON STURTEVANT,
2 produced as a witness at the instance of the rndustrial
3 customers of rdaho Power, having been first duly sworn,
4 was examined and testified as fo]lows:
5
6 DIRECT EXAMINATION
7
8 BY MR. RICHARDSON:
9 A cood afternoon, Mr. sturtevant. would you
10 state and spe'|l your name for the record, please?
11 A oonald Eugene sturtevant, JF.,
L? s-t-u-r-t-e-v-a-n-t.
13 a And are you the same Don Sturtevant who
L4 caused prefi'led test'imony to be filed in this case?
15 A ram.
16 A end do you have any corrections or
L7 additions to make to your testimony?
Page 261
J. R. sIMpLor coMpANy's MorIoN To rAKE - Pnge I
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
12051lafn. txt
18 A r do not, but in the hopes of expediting
19 this, r am the one that made the code ned, so r wi]I
20 admit to that. aad movie reference to code Red, you
2L can't handle the truth.
22 a thank you.
23 CoMMISSIoNER SMITH: rhis is a sheltered
24 utility wor'ld. No one even knows what you're talking
25 about.
CSB REPORTING 452 READING (COM)(208) 890-s198 rcrP
1 e By MR. RTCHARDSoN: Mr. sturtevant, if r
2 were to ask you the questions, same questions, that are
3 in your prefi'led testimony today, would your answers be
4 the same?
5 A rhey wou'ld.
6 uR. RICHARDSON: uadam chair, I move that
7 the testimony of tur. Sturtevant be spread upon the record
8 as if it were read in full.
CoMMISSIONER SMITH: Seeing no objection,
10 it is so ordered.
11 (rhe folloving prefiled direct testimony
L2 of Mr, Don Sturtevant is spread upon the record.)
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE Page2
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
)
120511afn. txt
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453 coLLoQuY
1 Q. P'lease state your name,
2 occupation, and business address..
3 A. . My name is Don Sturtevant, Corporate Energy
4 Manager for the :.R. Simp'lot company headquartered at 999
5 n,tain street, aoise, rdaho 83702.
6 a. please describe you educational background.
7 A. I'm a registered professional engineer,
8 'licensed in the state of ldaho and a certified energy
9 Manager. r hold a aache'lor's degree in l,techanical
10 Engineering from the un'iversity of rdaho and am a Masters
11 of sus'iness Administration student at Boise state
LZ University.
13 a. what is your work experience at the J.R.
14 Simplot company?
15 A. I've been the corporate Energy Manager for five
16 years, and have been with the company for the past eleven
L7 years. rn my current ro1e, r work with twenty-two
18 different utilities in North America, canada, and
19 lustralia.
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a. what is the purpose of your testimony?
A. the purpose of my testimony is to shed light on
22 the rdaho Power racilities charge program, exp'lain the
23 effects on the J.R. simplot company, and propose a
24 solution to what t consider to be an unfair business
J. R. srMpLor coMpANy,s MorroN To rAKE eage 263 Page 3
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
120511afn . txt
25 practice. :.R. simplot company is a member of the
CSB REPORTING 454 COLLOQUY(208) 890-s198
1 tndustrial Customers of Idaho Poyuer (ICP), and supports
2 the rcrPrs position in this case.
3 Q. P'lease explain in genera'l terms the location
4 and products produced at l,n. simplot Company's plants
5 taking service from tdaho Power as large power or special
6 contract customers.
7 A. lile are one of rdaho power's largest customers
8 with industrial facilities located in pocatello,
9 eberdeen, Nampa, and ca]dwell. tve also have several
10 commercial facilities )11 /
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ICIPCSB REPORTING(208) 890-s198
J. R, SIMPLoT CoMPANY'S MoTIoN To TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
page 264
455
Page 4
t?120511afn . txt
1 scattered throughout the state. We are an lgriausiness
2 company and have farming and catt'le operations, produce
3 ferti'lizer, and process potatoes into frozen
4 french-fries.
5 e. How many people are employed by :.n. simplot
6 Company in the State of rdaho?
7 A. We currently employ over three thousand (3,000)
I employees in rdaho.
I a. How much does the :.n. Simplot company spend on
10 electricity bills to rdaho power annually?
Ll- A. l.R. simplot company spends approximately $16.5
t2 million annually in rdaho Power charges.
I ) 13 a. Does l.R. Simplot company pay rdaho Power a
t4 facilities charge for electrica'l distribution equipment
L5 installed and maintained beyond the point of delivery by
16 rdaho Power at l.R. simplot Company's plants and
L7 facilities?
18 A. Yes.
19 a. cou'ld you explain your understandtng of the
20 facilities charge?
2L A. The current schedule 1-9 tariff states that at
22 rdaho Power's option, it may install and maintain
23 facilities beyond the point of delivery and charge 1.7%
24 monthly or 20.4% annually for company-owned facilities
25 beyond the point of de'livery.
CSB REPORTING 456 STURTEVANT (Di)[phone] rcrP
1 rdaho power has filed to reduce the facilities
J.R.sIMpLorcoMpANy,sMorIoNTorAKE eage 265
OFFICI,AL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
Page 5
L20511afn.txt2 charge to L.4L% monthly or L7.00% annually in this case
3 for schedule 19 customers, but not for special contract
4 customers. rn this context, r wou'ld 'l'ike to point out
5 that although the oon P'lant has a separate Special
6 contract executed in 2004, section 15.2 of the contract
7 specifically al'lows for changes to the schedule 29 rates,
I which include the faci'lities charge rate.
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CSB REPORTING 457 sruRrEvANT (Di)
ICIP(208) 8e0-s198
1 e. what types of equ'ipment are inc'luded in the
2 facilities charge?
3 A. The charge covers typ'ical higher-voltage
4 equipment such as transformers, poles, wires, and
rage 266
J, R. SIMPLOT COMPANY'S MOTION TO TAKE Page 6
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
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J. R. srMp,-or coMpANy's MorroN ro rAKE Page 267
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Exhibit 9
120511afn. txt
swi tches .
a. How much does :.R. Simp'lot company current'ly
pay as a facilities charge?
A. llle have $4.252 mill'ion in assets for which we
pay $867,426 each year.
a. uow did you become aware of the facilities
charge?
A. r was investigating our bills and noticed the
facilities charges. r began to question what the
charges were for and the total amount we were paying. r
was very surprised to find out that the facilities charge
was so large, that it never gets paid off, and we pay
20.4% annual 1y forever.
a. Has Idaho Po^,er ever requested your written
consent to instali any faci'lities beyond the point of
delivery at your plants?
A. NO.
a. Are you aware of such consent given by any
other J.R. simplot company officia'ls?
A. I am aware that section 10.1 0f the Don plant
specia'l contract approved in 2004 grants rdaho Power
458 Don Sturtevant, DI 1-
ICIP
access to simplot premises for installation, removal, and
maintenance of distribution facilities. t have reviewed
the schedu'le 19 tariff, and it contains no provision
requiring the customer to grant rdaho Power access for
purposes of insta'l'ling or maintaining distribution
facilities. rdaho Power formerly required customers to
execute a uniform schedule 19 Service Agreement, but the
version from 2001 that r have reviewed 'likew'ise prov'ides
Page 7
L205l1afn. txt9no
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459 oon sturtevant, Dr laICIP
1 provision granting the company access to customers'
2 premises for purposes of insta'lling or maintaining
3 distribution faci'lities.
4 Q. Does the schedu'le 19 tariff appear to al]ow
5 l.n. simplot €ompany as an ldaho Power customer to opt
6 out of the facilit'ies charge, and to take on the
7 responsib'ility for electrica'l distribution facilities on
8 simplot plants' property?
I A. No. rhe tariff plainly states: "At the option )
10 of the company, transformers and other facilities
11 installed beyond the Point of oelivery to provide erimary
eage 268
J. R. SIMPLOT COMPANY'S MOTION TO TAKE Prge 8
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
L
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Lz or rransmission t"t'ftt#"#iY.t o*n.d, operated, and
13 maintained by the company in consideration of the
L4 Customer pay'ing a racilities charge to the company." This
15 tariff implies the customer has no choice and it does not
16 state that the customer has the option to itse'lf own and
t7 maintain the faci'lities on its property.
L8 a. ooes tdaho Power's ownership and management of
19 electrical equipment on plants o,vned by :.n. simplot
20 company concern you from a liability perspective?
2L A. Absolute'ly. tn large industria'l and
22 commercial operations, safety is our highest priority.
23 a. what insurance requ'irements does l.R. simplot
24 company require of electrica'l contractors that conduct
25 work on its property?
460 Don sturtevant, Dr
1 A. We require that every contractor working at any
2 J.n. Simplot company location provide proof of $5 mil'lion
3 dol'lars in liabil'ity insurance.
4 a. Has Idaho Power provided J.R. simplot Company
5 with assurance that these simplot policies are met by
6 rdaho Power's liability coverage?
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J. R. sIMpLor coMpANy,s MorroN rorAKE page 269 prge 9
OFFICTAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
2
ICIPi)
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120511afn . txt
461 Don sturtevant, DI 2a
ICTP
A. No. we asked for insurance coverage documents
prior to this rate case and did not receive them. rhe
attorney for the lndustria'l customers of rdaho Power was
able to obtain summaries of rdaho Power's insurance
polic'ies only through discovery in the general rate case.
The Company stated in its Response to IcrP production
Request No. 14 contained in rcrp Exhibit r.ro. 305 that
"the insurance carried by the Company would cover any
loss for which the company was deemed neg'ligent in an
accident or injury." rt is not clear from this response,
or the documents describing the Company's insurance
pof icies providing in its Response to tctp production
Request ruo. 16 contained 'in rcrp exhibit tto. 305, that
the Company indemnifies or co-insures J.R. simplot for
such negligent acts, or that the commission requires 'it
to do so.
the schedule 19 tariff provides no requirement for
rdaho power to 'insure or indemnify customers aga'inst any
eage 270
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
Page l0
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120511afn. txt19 harm that may be caused to the customer or third parties
20 by rdaho Power's intentional or negligent acts re'lated to
2L distribution facilities on the customers' premises.
22 However, the Don plant specia'l contract approved in
23 2004 contains a general liability requirement, in section
24 12.1, which states:
25 each earty agrees to protect, defend, indemnify and
462 Don Sturtevant, DI 3
ICIP
t ho'ld harm'less the other Party, its officers
2 directors, parent company, affiliates, subsid'iaries,
3 agents representatives, and employees against and
4 from any and al'l liabi'lity, suits, Ioss, damage
5 claims, actions, costs, and expenses of any nature,
6 including court costs and reasonable attorney's
7 fees, even if such suits or claims are completely
8 groundless, as a resu'lt of injury to or death of any
9 person or destruction, loss or damage to property
10 arising in any way in connection with, or re'lated
11 to, this Agreement, but on'ly to the extent such
L2 injury to or death of any person or
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J. R. srMpt,or coMpANy,s MorroN To rAKE Page 27t page r r
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
23
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120511afn. txt
463 Don sturtevant, Dr 3
ICIP
destruction, loss or damage to property is not due
to the negl'igence or other breach of 1egal duty of
such other Party; provided, however, that each
party sha'lI be solely responsible for c'laims of and
payment to its employees for injuries occurring in
connection with their employment or arising out of
any worker's compensation law. rn no event sha'l'l
either Party be liable to the other for any
i ndi rect, i nci dental , speci a1 , or consequent'ia'l
damages of any character including, without
limitation, damages for 'lost profits or work
stoppages.
a. rs this provision in the Don Plant Special
contract consistent with :.n, simp]ot company's genera'l
insurance requirements for contractors performing work at
the plant?
A. No. Even th'is provision does not expressly
requ'ire r.R. simplot company's $5 million in insurance
requirement r testified to above,
a. Do you think it is reasonable for rdaho Power
to agree to indemnify l.R. simplot at the oon p'lant but
not to agree to indemnify J.R. s'implot at any of the
plants taking schedu'le 19 service?
A. NO.
a. p'lease comment on the average age and overall
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J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
Page 272
Page 12
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120511afn. txt
4 simplot company premises subject to the facilities
5 charge.
6 A. Yes. The remaining book value for al'l of our
7 equipment is listed below:
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467 Don Sturtevant,
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J.R.srMpLorcoMpANy'sMorroNTorAKE eage 275
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE'
Erhibit 9
DI 5
ICIP
Page 15
120511afn . txt
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11 a. Do you think it would be fair for rdaho Power
tZ to sell this equipment to you for that price?
13 A. No, I do not. t|,e have many items that are
L4 much o'lder than 30 years. tle have calculated that 520
15 items at our plants are over 30 years old, which is 32l[
16 of ai'l of our facilities charge equipment. we have paid
L7 for this equipment several times already, and if we paid
18 the net book va'lue on the remaining items, we wou'ld not
1-9 get fair credit for the overpayments that we have already
20 made on equ'ipment that should have been paid off long
2L ago. overall, we have paid for the initial value of this
22 equipment more than 3.4 times already and should be given
23 ownership of al'l items today.
24 a. what is your understand'ing of the options
25 provided by rdaho Power's facilities charge for the
468 Don sturtevant, Dr I.,E
1 customer to stop paying the charge?
2 A. under the plain terms of the Schedule 19 tariff
3 and sections 4.2 and 7,3 of the 2004 Don Plant specia'l
4 contract, we may require rdaho Power to "remove" the
5 facilit'ies. But then we must pay rdaho Power for the
6 remaining depreciated value of the facil'ities plus the
7 cost to remove the facilities minus a credit for the
8 salvage value of the equipment. There is no express
9 provision allowing for purchase of facilities by the
10 customer to avoid paying remova'l
J. R. srMpt,or coMpANy,s MorroN To rAKE Page 276 prge 16
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
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10 a. Has the
11 facilities charges
t2 uti'l i ti es?
13 A. Yes. At
J, R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
120511afn. txt
J . R. Si mpl ot company pai d si mi 'lar
in other jurisdictions, or with other
our othe'l'lo, washington facility,
Page 277
469 Don Sturtevant, DI 7ICIP
1 costs and to avoid incurring additiona'l costs that may
2 arise if rdaho Power is unable to find a willing buyer
3 for the facilities or otherwise salvage the facilities.
4 rn other words, the faci'lities charge does not allow for
5 the customer to purchase the faci'lities from tdaho Power,
6 even if the customer has more than paid off the init'ial
7 investment and provided rdaho Power w'ith reasonab'le fees
8 to cover operation and maintenance and a reasonable
9 return.
Page 17
120511afn. txt
L4 Avista was charging us 21% annua'Ily, wh'ich was paid off
15 after thirty years. ulhen t 'learned of this, r
16 approached the nvista staff and requested that we be
L7 al1ov'red to pay off th-is charge and get out from under the
18 exorbitant payments. rhey agreed, we paid it off, and
19 they have offered to do maintenance or repairs for us at
20 a "time and materials" rate. This is the only other
2L utility w'ith which we pay a facilit'ies-type charge.
22 a. rf :.R. Simplot company were sol'iciting
23 competitive bids from private companies to'lease and
24 manage the electrica'l facilities simi'lar to those
25 services provided by rdaho Power under the facilities
47A Don sturtevant, Dr 7ICIP
1 charge, would you consider a bid of an ongoing annua'l
2 charge of L7.00% of the initial investment to be a
3 reasonable bid for your schedule 19 facifities? How
4 about the 20.4% for the oon plant?
5 A. Not at aI'!. As you know, interest rates are
6 very 1ow. Anyone who approached us with this type of
7 financing option wou'ld not be considered.
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J. R. srMplor coMpANy's MorroN To rAKE eage 278
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibii 9
Page l8
120511afn. txt
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471 Don sturtevant, Dr 7a
ICIP
1 Q. Has :.R. Simplot Company approached tdaho Power
2 to request that rdaho Power se'|l the facilities charge
3 equipment, or otheftvise allow J.n. simp'lot company to
4 stop paying rdaho Power for electrical equipment on l.R.
5 simp'lot company property?
6 A. Yes. rn meetings and letters in the year prior
7 to this rate case, :.n. Simplot company requested that it
8 be allowed to exercise the option to own a'11 of its
I distribution facilit'ies beyond the point of delivery. rn
10 a letter from our attorney dated oecember 30, 2010, we
11 requested that tdaho Power provide the depreciated book
LZ value of those facilities so that we could evaluate the
13 option of ownersh'ip. we also reguested that rdaho Power
L4 prov'ide the costs by the end of January 20lL because we
15 needed the information by that time to adequately
16 eva'luate it in time for interna'l financ'ial decision
L7 timelines for the next fisca'l year.
18 rdaho Power responded by letter on lanuary 31, ZALL,
19 by stating that it would provide l.R. simplot company
20 with "buy-out" prices by mid-march 2011. tt stated that
J. R. srMp.,or coMpANy's MorroN To rAKE eage 279 page 19
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibir 9
L20511afn. txt
2L it wou'ld only provide such prices at the "fair market
22 value price of those facilities, not at the depreciated
23 book value price." rdaho Power a'lso indicated it would
24 need to install additional protective equipment on its
25 side of the meter if it sold these pieEes of equipment to
472 oon sturtevant, Dr 7a
ICIP
1 simplot, and that it wou'ld provide the cost for that
2 equipment to us mid-t,tarch 2011 as we]l.
3 rdaho power also stated it wil'l not a]low for mixed
4 ownership, or an option whereby simplot owned the
5 equipment and paid rdaho Po/uer a limited facilities
6 charge for maintenance expenses, like the opt'ion offered
7 by evista in a simi]ar situation. these 'letters are
8 included in rctp Exhibit No. 307, attached to Dr. Don
9 neading's direct testimony.
10 a. oid rdaho Power provide such prices by
11 mi d-tlarch?
L2/
13/
L4/
15
16
L7
18
19
20
2t
22
23
z4
eage 280
J. R. SIMPLOT COMPANY'S MOTION TO TAKE
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
Page 20
120511afn. txt
473 Don sturtevant, Dr 8ICIP
1 A. No. rdaho Power contacted us at the end of
2 lvtarch to set up a meeting in npril 2011. prior to the
3 meeting, rdaho Pov{er's attorney sent our attorney an
4 email stating, for the first time, that rdaho Power would
5 not agree to sell the facifities to us. This email 'is
6 included in tcrp exhibit No. 307 attached to the direct
7 testimony of Dr. Don neading. at a meeting on apri'l 1l-,
8 2011, attended by our representatives, rdaho Power took
I the position that it cannot sel1 facilities to simplot at
10 a fair market price w'ithout increasing the rates of other
11 schedule 19 customers. rhe price rdaho Power stated, for
LZ discussion purposes only, that J.n. simp'lot would have to
13 pay rdaho Power was approximately $10 million for the
14 facilities if they were to be sold, which is over twice
15 the initial investment'in the faci'lities provided by
16 rdaho Power of $4.25 million.
L7 a. ooes it seem fair to offer to se'|I the
18 faci]i ti es at over twi ce the 'i ni ti al i nvestment?
19 A. No, but rdaho Power never actually stated that
20 was an option. rhey just provided the ca'lculation of
2L what they believed we would need to pay in order to
22 purchase these faci'lities after years of paying the
23 faci'lities charge.
24 a. ooes tdaho Power's response that it cannot
25 allow for mixed ownersh'ip make sense to you?
474 Don sturtevant, Dr IICIP
J.R.srMpt,orcoMpANy'sMorroNTorAKf, eage 281
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
Page 2l
1205llafn. txt
1 A. Not at all. rhey cite that safety 'is the
2 reason, and we agree that safety of a'l'l emp'loyees, theirs
3 and ours, is of the most paramount concern. However, we
4 have successfully had mixed ownership of equ'ipment at our
5 caldwell facility since 1945 without incident.
6 Additionally, in conversations with other customers that
7 are paying facilities charges, they have mixed ownership
8 as well. eelow is a picture of the mixed ownership at
9 our caldwe'l'l facility:
10/
11 /
t2/
13
L4
15
16
t7
18
19
20
21
22
23
24
25
475 Don Sturtevant, Dr 9
ICIP
+
Page 282
J. R. SIMPLOT COMPANY'S MOTION TO TAKE - Prge 22
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
120511afn. txt
1
2
3
4
5 (picture contained in hard copy of transcript.)
6
7
I
9
10
11
L2
13
L4
;) 1s
L6
L7
18
19
20
2L
22
23
24
25
476 oon sturtevant, Dr 10
ICIP
1 Q. Did rdaho Por,r,er ever provide J.R. Simplot
2 Company with the cost to simp1y remove the equipment
J. R. sIMpLor coMpANy's MorroN To rAKE eage 283 Prge 23
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
120511afn. txt3 subject to the faci'lities charge, as expressly allowed in
4 the oon plant specia'l contract and the schedule 19
5 tariff?
6 n. we requested that cost in discovery in this
7 case, and they required us to request it outside of the
8 rate case. our attorney then sent a letter to Idaho
9 power requesting the remova'l costs. rdaho Power's
10 response letter from their attorney to our attorney,
11 contained in rcrP exhibit tto. 308 attached to Dr. Don
LZ neading's direct testimony, said exercis'ing the removal
13 option may require turning the power off at our
t4 facilities, thus interrupting product'ion. Removal wou'ld
15 also require l.R. simplot company to first pre-pay rdaho
l-6 Power to engineer a plan to remove the faci]ities in
L7 phases. r understand that the remova'l cost may increase
18 'if rdaho Power is not able to find a good sa'lvage use for
19 the equi pment. r be'li eve that th'i s compl i cated remova'l
20 process is unnecessary when we have already paid for the
2L equipment and when it is already being put to use at our
22 faci'lities. rt makes no sense to charge us to remove the
Zi equipment and attempt to find some other use for it when
24 we have repeatedly paid for its full initial va'lue
25 a1 ready.
477oon sturtevant, Dr ,193
L Q. what is the current status as you understand
2 it?
3 A. J.n. Simp'lot company is still paying the
4 facilities charge at each of the plants served by rdaho
5 Power, and rdaho Power has provided no description
6 satisfactory to the l.R. simplot company of how it wou'ld
J.R.sIMpLorcoMpANy'sMorroNrorAKE eage 284 pasez4
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
12051lafn . txt7 stop paying the charge.
8 Q. If you had the choice,
9 Idaho Power address the problems
10 facilit'ies charge?
11 /
L2/
13/
L4
15
16
L7
18
19
20
2L
22
23
24
25
how would you propose
you see with its
478 Don Sturtevant, Dr
A. we have paid for our current facilities charge
equipment more than three times already. r believe that
Idaho Power has already recovered its init'ial costs and
any authorized rate of return several times over. It
would be fair to simply turn ownership of these
faci'li ti es over to J . R. si mp'lot company.
ndditionally, t believe it is imperative that the
commiss'ion seriously reform the facilities charge
according to the proposals and analysis contained in Dr.
11
ICTP
1
2
3
4
5
6
7
I
I
J. R. srMpLor coMpANy's MorroN To rAKE eage 285
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
Page 25
120511afn. txt10 oon Reading's testt-ridny. ' i -+'ir11y support the \
11 recommendations contained in the direct testimony of or.
LZ oon Reading, which would make the monthly charge fair for
13 those customers who wish to pay it and would provide
L4 reasonable mechanisms by which customers may take over
15 ownership of equipment on their own property.
16 A. Does this conc'lude your testimony?
L7 A. Yes.
18
19
2A
2L
22
23
24
2s ')
479oon sturtevant, Dr 1laICIP
1 (rhe following proceedings were had in
2 open hearing.)
3 MR. RICHARDSoN: utadam Chair, with your
4 indulgence, r have a couple of smal'l housekeeping direct
5 questions.
6
7 DIRECT EXAMINATION
8
9 ev MR. RTcHARDSoN: (continued)
10 a Mr. Sturtevant, what's been your
11 experience with critical spare parts with this special
tz facilities program?
J. R. srMpt,or coMpANy's MorroN To 'AKE
page 286 page26
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
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L20511afn..txt
t haven't, but I bel'ieve that's why we're approaching the
2 comm'ission to determine.
3 Q Are you aware that rdaho Powerrs
4 facilities charge methodology does conta'in a depreciation
5 expense in it?
6 e oeprec'iation is included in the 20.4
7 percent annually or the 1.7 percent month'ly. there is a
8 line item in there, as r understand it, that hasn't been
9 revisited since 1985.
10 a So the answer, just to be clear, is yes,
11 there is a depreciation expense component in the
LZ facilities charge methodology?
1-3 A Yes, as I understand it from Idaho Power,
t4 there's a 'listing on a line item that says depreciation.
15 Rs t understand from my studies that depieciation means
16 of something that you wou'ld pay off as a deprec-iat'ion
L7 expense, as a capita'l asset.
18 a rhanks. Are you aware that rdaho Power
19 credits back 100 percent of the revenue it col1ects from
20 the facilities charge customers to the class in which the
2L customer resides?
22 A No, I'm not, but if you say so, okay.
23 a so you agree with me, then?
24 A r'm not aware that you do, but r'm not
25 that up to speed on a'l'l the rulemaking and how you
CSB REPORTTNG 485 STURTEVANT (X)[phone] rcrP
1 account for the money. we don't see any money back on
2 our bills for facil'it'ies charges, if that's what you're
3 saying.
J. R. srMpI-or coMpANy's MorIoN To rAKE eage 291 Pnge 3l
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
120511afn . txt
4 e would you agree with me that as part of
5 the facilities charge servfce that rdaho Power provides
6 that S'implot receives customer service on a
7 24/7/365-day-a-year basis?
8 n Yes.
9 Q and do you believe that the operations and
10 maintenance services provided by rdaho Power's field
11 personne'l have been satisfactory?
t2 A rt's been absolutely satisfactory. To the
13 level of paying 20.4 percent forever, r think that we
L4 could do it ourselves much cheaper.
15 MR. WTLLIAMS: A11 right, thank you. No
16 further questions, Madam chair.
L7 CoMMISSIoNER SMITH: thank you. Let's see
LB if there are questions from the commissioners.
19 COMMISSIONER REDFORD: NO.
20 COMMISSTONER SMITH: NOT I.
2L Mr. R'ichardson, do you have any redirect?
22 MR, RICHARDSON: Just a coup'le,
23 wtadam chai r.
24
25
486CSB REPORTING(208) 890-5198
srunreveur (x)
ICIP
1 REDIRECT EXAMINATION
2
3 BY MR. RICHARDSON:
4 Q Mr. Sturtevant, Mr. Williams asked you
5 about the 24/7/365 service, overal], how valuable is that
6 to you?
J. R. srMplor coMpANy,s MorroN To rAKE eage 292 Page 32
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
120511afn. txt
7 A when you're in a production facility such
8 as we are, it's extreme'ly valuab'le, but value has a
9 specific connotation with it.'would we pay a mi'l'lion
L0 dollars for that or would we pay 500,000 or 100,000, so
11 itrs extremely valuable. I don't think that it's
LZ necessarily priced competit'ive1y at 20.4 percent.
13 a so what was your experience as an energy
L4 official for simplot with other utilities on facilities
15 charge-type services?
16 A yeah, we had the same issue with Rvista
L7 uti'lities. uJe have a faci'lity over in othello,
18 washington. tlle were current'ly paying 21 percent annual
19 interest rates to them or annual rate of payment. r
20 understand it's not necessarily an interest rate, and we
2L approached the utility over there and they said
22 absolutely, you can buy this out if you want and we''ll
23 put it on your bill and they were very accommodating.
24 t,rlithin three to four months, we got it resolved to great
25 sati sfaction.
CSB REPORTING 487 STURTEVANT (X)[phone] rcrP
1 A end as an energy facilities manager for
2 simp'lot and you look at a program 'like the facilities
3 charge program that rdaho Power offers, in your v'iew, who
4 was that program designed for?
5 a tt's defin'itely, r th'ink, designed towards
6 some of the smaller people out there that may not have
7 the capital to go forward with transformers and poles and
8 wiring, so it could be a good service if it was
9 structured correctly. For us as a larger industrial
10 customer, we actually have a pretty good position within
J.R.srMpLorcoMpANy'sMorIoNTorAKE eage 293 Page33
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
1205l1afn. txt
11 the community and have good access to capital and we'd
t2 like to own that equ'ipment outright if we could.
13 a But you'd like to have the choice?
14 A That's right. rt's all about the
15 choice.
L6 MR. RTCHARDSoN: That's al'l I have,
L7 uadam chair. rhank you, Mr. sturtevant.
L8 COMMISSIoNER SMITH: Thank you, Mr.
19 sturtevant. tl/e appreciate your he1p.
20 MR. RICHARDSON: May this witness be
2L excused, Madam chair?
22 coMMrssroNER sMrrH: seeing no objection,
23 the witness is excused.
24 THE WITNESS: thank you.
25 (the witness left the stand.)
STURTEVANT (X)488CSB REPORTING(208) 890-s198 ICIP
1 MR. RICHARDSON: thank you. rhat
2 concludes the rndustria'l customers' case, Madam chair.
3 COMMISSIONER SMrTH: rhank you, Mr.
4 Richardson.
5 Mr. otto, we're ready for your witness.
6
7 NANCY HIRSH,
I produced as a witness at the instance of the conservation
9 parties, having been first duly sworn, was examined and
l-0 testified as follows:
11
L2 DIRECT EXAMINATION
L3
L4 BY MR. OfiO:
J.R.sIMpLorcoMpANy,sMorroNTorAKE page 294 page34
OFFTCIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
120511afn. txt
15 A okay, could you please state your name and
L6 your position for the record?
t7 A Nancy Hirsh, H-'i-r-s-h. I'm the policy
18 director with the Northwest Energy coa'lition.
19 a Are you the same Nancy nirsh that filed
20 direct testimony and rebuttal testimony in this case?
27 A Yes,ram.
22 a lnd we discussed there were three
23 corrections that we found to this testimony.
24 A Yes.
25 a end the first one had to do with -- well,
CSB REPORTING 489 STURTEVANT (Di)[phone] rcrP
L 'let's start with the first one that actually
2 Ms. ruordstrom brought to our attention.
3 A Yes. On page 10 of my direct testimony,
4 lines 7 and 8 where it says that -- where it starts
5 "$10,000,000" and it should say "of the back balance in
6 energy efficiency funding" instead of the "demand
7 response," and then on page 18 --
I cottlMIssIoNER SMITH: Excuse me, we need
9 that one more time.
10 THE WITNESS: Page 10.
11 CoMMISSIONER SMITH: Please read how it
LZ should read right now.
13 THE WITNESS: okay. eage 10, line 7 --
1,4 coMMrssroNER sMrrH: start with "the
15 commission. "
16 THE WITNESS: "The Commission initially
t7 considered this accounting change 'in a prior case" --
18 COMMISSIONER SMITH: Oh, I mean on line 7.
J.R.STMPLOTCOMPANY'SMOTTONTOTAKE eage 295 Page35
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
i).
120511afn. txt
19 You have a "the Commission."
20 THE WITNESS: Okay. "The commission
2L authorized rdaho Power to co]lect $10,000,000 of the back
22 balance in energy efficiency funding...".
23 coMMrssroNER surrH: And strike --
24 THE WITNESS: and strike "in demand
25 response incentives. "
CSB REPORTING(208) 890-51e8
490 srunrevlrur (oi)
ICIP
1 GOMMISSTONER SMITH: Okay. All right;
2 thank you.
3 rHE WITNESS: Okay, and then on page 18,
4 line 16, the word "funding" should actual'ly be "rider."
5 MR. RTCHARDSON: which l-ine is that?
6 THE WITNESS: fhat is line 16. "Funding"
7 shou1d be struck and in its place should be "rider," and
8 then the third is a clarification. Throughout my
9 testimony, r characterize that the commission's orders --
10 cor4MrssroNER sMrrH: would you start
11 again, please?
LZ THE WITNESS: In my testimony, r
13 characterize the commission's orders as saying that they
\4 require the company to acqu'ire all cost-effective
15 conservation or energy efficiency, and in fact, going
16 back through some of those orders, the 'language is that
L7 the Commission directs the Company to pursue a'11
18 cost-effective energy efficiency. r do believe t
L9 characterize that interpretation as acquire, because
2A pursuing is good, but acquiring savings is better. t
2L think that was the intent of the commission, so that's
22 the end of my correct'ions.
J.R.srMpI,orcoMpANy,sMorroNTorAKE eage 296
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9
Page 36
23
24
25
work with the
there's about
CSB REPORTING(208) 890-5198
ABY
4 clarifications; so
5 questions in your
6 would your answers
7
8
120511afn . txt
MR. OTTO: lust on that
recorder, but r have the
five places where it says
'last one, r can
specific --
"acquire" instead
STURTEVANT (Di)
ICIP
that, r would move to
inc'luding Exhibits 801, 802
no objection,
of us. Hirsh
801- through
di rect and
i s spread upon the
49L
1 of "pursue." r don't th'ink it's necessary for all of us
2 to chase through that.
MR. oTTO: rhank you for those
with that, if r asked you the same
direct and rebuttal testimony today,
be the same?
A YES.
MR. OTTO: With
9 spread us. xirsh's testimony,
10 and 803 upon the record.
11 COMMISSIONER SMITH: Seeing
LZ the prefiled direct and rebuttal testimony
13 will be spread upon the record and rxhibr'ts
L4 803 will be identified.
15 (rhe fo'l low'i ng prefil ed
16 rebuttal testimony of us. Nancy xirsh
t7 record.)
L8
19
20
2L
22
23
24
25
J. R. srMpl-or coMpANy's MortoN rorAKE eage 297
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Erhibit 9
CSB REPORTING(208) 890-51e8
12051lafn. txt
492 srasn (oi)
conservation Parties
1 Q. please state your name, affiliation, and
2 high'light some of your qualifications.
3 A. My name is Nancy ttirsh. since 1996, t have been
4 the policy director for the NW Energy coalition,
5 coordinating the work of the policy team in advocating
6 for investments in clean and affordable energy services.
7 The Nurl Energy Coalition is an al1iance of more than 110
8 environmental, civic and human service organizat'ions,
9 progressive uti'lities and businesses from oregon,
10 washington, rdaho, Montana, elaska and aritish Columbia.
11 h,e promote energy conservation and renewable energy , \
Lz resources, consumer and low-income protection and fish ' I
13 and wildlife restoration in the columbia River easin.
L4 The coalition has 11 member organizations in ldaho,
15 including groups such as Advocates for the tiuest, rdaho
16 Rural counci'1, the Idaho conservation League, the League
L7 of women voters, the Snake River el'liance, and the South
18 Central Community Action Agency. rn addition, r serve as
19 Chair of the goard of the nenewable Northurest eroject and
20 sit on rdaho power's Energy efficiency ndvisory Group.
2L ereviously, r spent twelve years in washington, D.c.
22 working for the National t,llildlife rederation and
23 Environmenta'l Rction roundation on federa'l energy po'licy
24 and electric utility issues, including providing
25 assistance to state environmental and consumer
csB REPORTTNG 493 Urnsn (Oi)[phone] conservation Parties i
?
J.R.sIMpLorcoMpANy'sMorroNTorAKE eage 298 page38
OFFICIAL NOTICE AND/OR OFFER INTO EVIDENCE.
Exhibit 9