20170518Comments.pdf

DAPHNE HUANG
DEPUTY ATTORNEY GENERAL
IDAHO PUBLIC UTILITIES COMMISSION
PO BOX 83720
BOISE, IDAHO 83720.0074
[phone]
IDAHO BAR NO. 8370
Street Address for Express Mail:
472W. WASHINGTON
BOISE, IDAHO 83702.59I8
Attorney for the Commission Staff
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
[i':nII\,/[D
i il il',';' i 3 Fl.,l IZ: I0
L\ oJrJ
IN THE MATTER OF THE APPLICATION OF )
rDAHO POWER COMPANY FOR AUTHORTTY )
TO INCREASE RATES FOR ELECTRIC )
SERVICE DUE TO REVISED DEPRECIATION )
RATES FOR ELECTRTC PLANT-IN-SERyICE. )
)
CASE NO. IPC.F"-I6-23
COMMENTS OF THE
COMMISSION STAFF ON
PROPOSED SETTLEMENT
COMES NOW the Staff of the ldaho Public Utilities Commission, by and through its
Attorney of record, Daphne Huang, Deputy Attorney General, and submits the following
comments.
BACKGROUND
On October2l,20l6,Idaho Power Company filed an Application asking the
Commission to adopt revised depreciation rates for its electric plant-in-service and
correspondingly adjust Idaho jurisdictional base rates effective June 1,2017 . Application (Case
No. IPC-E -16-23) at l. The Company requested that the incremental revenue requirement of
$6,672,588 equating to 0.59% be recovered from customers through a uniform percentage
increase to all base rate components except the service charge. Errata to Application (Case No.
IPC-E-16-23). Depreciation and recovery of the North Valmy power plant is separately
addressed in concurrent Case No. IPC-E-16-24.
ISTAFF COMMENTS MAY I8,2OI7
On January 17,2017, the Commission issued a Notice of Modified Procedure soliciting
written comments on the Application. See Order No. 33690. Settlement discussions were held
with interested parties on February 2,2017, with subsequent telephone conferences. The
resulting Settlement Stipulation was filed with the Commission on May 3,2017. See Settlement
Stipulation and Motion to Approve Settlement Stipulation. Staff files these comments in support
of the Stipulation.
STAFF ANALYSIS
Staff evaluated the requested depreciation components by account including useful life,
Iowa curves, removal cost, salvage values and the resulting depreciation accrual rate. Staff also
compared the proposed rates to existing Idaho Power depreciation rates and rates for other
electric companies.
Staff met with the Company and interested parties to thoroughly discuss all depreciation
accounts. Staff expressed concerns for many accounts where the study data supported extending
the depreciable lives. Staff supported limiting the change in net salvage values until five
additional years of removal costs and salvage values are included in the data for review in the
next depreciation study. Staff also evaluated the fit of the Iowa Curve to the data and suggested
changes. In the next study when determining the Iowa Curve to utilize, the Company should
better document when and why a curve is not solely selected on the data. Staff believes
significant modifications in these areas are reflected in the stipulated terms.
Each Depreciation Study covers the life history of data for each account. For the next
study, Staff believes Idaho Power should expand the presentation and discussion for Account
Nos. 370 Meters and 370.1 Meters - AMI. Amortization periods for non-depreciable accounts
were not evaluated in this study. Staff believes each of these account amortization periods,
specifically Account No. 303 Miscellaneous Intangible Plant, should be studied again and
justified.
The Stipulation includes Attachment I showing the stipulated lives, survivor curves, and
net salvage values along with the depreciation accrual rate for each account. The Stipulation also
includes Attachment 2 showing a comparison of the positions of Parties and the Settlement
position for each account. Staff believes significant modifications have been agreed upon by the
Parties and the resulting depreciation accrual rates are reasonable. The revised depreciation
2STAFF COMMENTS MAY 18,2017
accrual rates do not change retail rates for customers. Staff recommends the Commission accept
the Stipulation as filed, effective June 1,2017 with no customer retail rate change.
CUSTOMER NOTICE AND PRESS RELEASE
The Company's press release and customer notice were included with its Application.
Staff reviewed the documents and determined that both meet the requirements of Rule 125 of the
Commission's Rules of Procedure (IDAPA 31.01.01).
The notice was included with customer bills. The last notice was mailed on December 6,
2016 allowing customers a reasonable opportunity to file timely comments with the Commission
by the iMay 25,2017 deadline. As of May 17 ,2017 , the Commission had received no comments
from customers.
RECOMMENDATIONS
Staff recommends that the Commission approve the depreciation accrual rates on an
account-by-account basis as shown in Stipulation Attachment No. I with a composite
depreciation rate of 2.55%. Staff also recommends these depreciation rate changes be effective
June 1,2017.
i&
Respecttully submitted this f b-auy of May 2Ol7 .
Deputy Attomey General
Technical Staff: Teni Carlock
Rick Keller
Daniel Klein
i:umisc:comments/ipce I 6.23djhtcklsrkdk comments
JSTAFF COMMENTS MAY t8,2017
CERTIFICATE OF SERVICE
I HEREBY CERTIFY THAT I HAVE THIS I STH DAY OF MAY 2017,
SERVED THE FOREGOING COMMENTS OF THE COMMISSION STAFF ON
PROPOSED SETTLEMENT, IN CASE NO. IPC-E-16-23, By MAILING A COpy
THEREOF, POSTAGE PREPAID, TO THE FOLLOWING:
LISA D NORDSTROM
REGULATORY DOCKETS
IDAHO POWER COMPANY
PO BOX 70
BOISE ID 83707-0070
E-mail : lnordstrom@idahopower. com
[e-mail]
ERIC L OLSEN
ECHO HAWK & OLSEN PLLC
PO BOX 6119
POCATELLO ID 83205
E-mail : [e-mail]
THORVALD A NELSON
FREDERICK J SCHMIDT
EMANUEL T. COCIAN
BRIAN T HANSEN
HOLLAND & HART LLP
6380 S FIDDLERS GREEN CIR STE 5OO
GREENWOOD VILLAGE CO 8OI I I
E-mail : [e-mail]
fschmidt@hol landhart. com
etcocian@hollandhart. com
[e-mail]
E.MAIL ONLY
[e-mail]
klhall@hol landhan.com
[e-mail]
MATTHEW T. LARKIN
IDAHO POWER COMPANY
PO BOX 70
BOISE rD 83707-0070
E-mail : [e-mail]
ANTHONY YANKEL
12700 LAKE AVE
UNIT 2505
LAKEWOOD OH 44107
E-mail: [e-mail]
PETE BENNETT
MICRON TECHNOLOGY INC
8OOO S FEDERAL WAY
BOISE ID 83707
E-mail: [e-mail]
STEVEN PORTER
US DEPT OF ENERGY
1OOO INDEPENDENCE AVE SW
ROOM 6D-033
WASHINGTON DC 20585
E-mail: [e-mail]. gov
CERTIFICATE OF SERVICE
PETER J RICHARDSON
RICHARDSON ADAMS PLLC
515 N 27TH STREET
BOISE TD 83702
E-mail : [e-mail]
BENJAMIN J OTTO
ID CONSERVATION LEAGUE
PO BOX 844
BOISE ID 8370I
E-mail: [e-mail]
DR DON READING
6070 HILL ROAD
BOISE ID 83703
E-mail : [e-mail]
TRAVIS RITCHIE
SIERRA CLUB
2101 WEBSTER ST
STE 13OO
OAKLAND CA946I2
E-mail : [e-mail]
CERTIFICATE OF SERVICE