20170306final_order_no_33723.pdf

Office ofthe Secretary
Service Date
March 6,2017
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE JOINT )
APPLICATION OF IDAHO POWER )CASE NO.IPC-E-16-29
COMPANY AND UNITED ELECTRIC CO-)
OP FOR APPROVAL OF A CUSTOMER )ORDER NO.33723
ALLOCATION AGREEMENT )
On November 22,2016,Idaho Power Company and United Electric Co-op,Inc.filed
a joint Application requesting that the Commission approve a Customer Allocation Agreement
for a small part of the Idaho Power territory that borders the United Electric service territory.
Application at 1 -2.The area has not previously been provided with electric service.
On December 21,2016,the Commission issued a Notice of Application and Order
setting an intervention deadline of January 11,2017.No parties intervened.On January 27,
2017,the Commission ordered that the case be processed by Modified Procedure and set a
February 21,2017 comment deadline,and a February 28,2017 reply deadline.Staff filed timely
comments and the Company notified Staff that it would not file a reply.The Application falls
under the Electric Supplier Stabilization Act (ESSA),Idaho Code §6 1-332,ci seq.
BACKGROUND
The ESSA prohibits an electric supplier (e.g.,a utility,municipality,or co-op)from
serving another electric supplier’s existing or former customers.Idaho Code §61-332B.As an
exception to this general rule,the ESSA allows electric suppliers to contract for the purpose of
“allocating territories,consumers,and future consumers...and designating which territories and
consumers are to be served by which contracting electric supplier.”Idaho Code §61-333(1).
Such contracts must be submitted to the Commission for approval.Id.
Agreements reviewed under the ESSA should be approved if,after notice and
opportunity for hearing,the Commission finds that the agreement conforms with the purposes of
the ESSA,See Idaho Code §61-333(1)and 6l-334B(1).Section 61-332(2)states the purposes
of the ESSA are to:(1)promote harmony between electric suppliers;(2)prohibit the “pirating”
of consumers;(3)discourage duplication of electric facilities;(4)actively supervise the conduct
of electric suppliers;and (5)stabilize service territories and consumers.
ORDERNO.33723 1
THE APPLICATION
Idaho Power and United Electric Co-op have agreed to the transfer of the service
territory of one customer.The customer would like to install a three phase 480 volt service in
order to use a pump.For Idaho Power to provide that service,it would have to rebuild
approximately three quarters of a mile of transmission lines at the customer’s expense.
The property is adjacent to United Electric’s service area.United Electric has three
phase power located only about 300 feet from the desired pump location.For cost reasons,the
customer requested that United Electric provide service to the property.In order to comply with
the customer’s request,avoid duplication of facilities,and avoid the imposition of unnecessarily
high line extension charges,the utilities agreed to the transfer of the territory to United Electric
going forward.That agreement is now before the Commission for consideration.
THE COMMENTS
Commission Staff provided the only comments on this matter and provided the
Commission with a thorough review of the Company’s request.Staff observed that the sole
customer of the territory at issue requested the transfer because of a significant cost savings.
Staff commented that the agreement furthers the ESSA’s purpose by avoiding duplication of
facilities,stabilizing service territories and customers,and promoting harmony between the two
neighboring utilities.Finally,Staff pointed out that the agreement avoids needless duplication of
facilities and service,and potential stranded investment.Staff recommended the Commission
find that the Agreement conforms to the ESSA’s purposes and grant the Application and approve
the Agreement.
DISCUSSION AND FINDINGS
The Idaho Public Utilities Commission has jurisdiction in this matter to “review and
approve or reject contracts between ...municipalities and public utilities Idaho Code §61-
333(1).The Commission shall “approve such contracts only upon finding that the allocation of
territories or consumers is in conformance with the provisions and purposes of [the ESSA].”Id.
As set out in Idaho Code §6 1-332(2),the purposes of the ESSA are to:(1)promote harmony
between electric suppliers;(2)prohibit the “pirating”of consumers;(3)discourage duplication of
electric facilities;(4)actively supervise the conduct of electric suppliers;and (5)stabilize service
territories and consumers.The ESSA further contains a requirement of ‘just compensation”in
such transactions.Idaho Code §61-333B.
ORDERNO.33723 2
Section 6 1-333 allows the parties to exchange customers and territory subject to
Commission supervision of such transactions.The Commission has reviewed the record in this
case,including the proposed agreement,We find that the proposed agreement meets the
requirements of the ESSA.Accordingly,we approve the agreement.
ORDER
IT IS HEREBY ORDERED that the Application to approve the proposed Customer
Allocation Agreement to transfer from Idaho Power Company to United Electric Co-op,Inc.one
customer and the accompanying service territory is approved.
IT IS FURTHER ORDERED that the exchange shall be effective upon execution of
the agreement by both parties.
THIS IS A FINAL ORDER.Any person interested in this Order may petition for
reconsideration within twenty-one (21)days of the service date of this Order.Within seven (7)
days after any person has petitioned for reconsideration,any other person may cross-petition for
reconsideration.See Idaho Code §6 1-626.
DONE by Order of the Idaho Public Utilities Commission at Boise,Idaho this d
day of March 2017.
/
PAUL KJELLANDER,PRESIDENT
KRfSTINE RAPEJ-e%4MTSSIONER
ERIC ANDERSON,COMMISSIONER
ATTEST:
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Diane Hanian
Commission Secretary
0:EPC-E-I 6-29bk3
ORDER NO.33723