20231228Final_Order_No_36042.pdf

ORDER NO. 36042 1
Office of the Secretary
Service Date
December 28, 2023
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

IN THE MATTER OF THE APPLICATION
OF IDAHO POWER COMPANY FOR
AUTHORITY TO INCREASE ITS RATES
AND CHARGES FOR ELECTRIC SERVICE
IN THE STATE OF IDAHO AND FOR
ASSOCIATED REGULATORY ACCOUNT
TREATMENT
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CASE NO. IPC-E-23-11

ORDER NO. 36042

On June 1, 2023, Idaho Power Company (“Company”) filed an application (“Application”)
with the Idaho Public Utilities Commission (“Commission”) requesting authority to increase its
rates and charges for electric service to its customers in the State of Idaho and for associated
regulatory accounting treatment. The Company requested a July 1, 2023, effective date.
On June 23, 2023, the Commission issued a Notice of Application, Notice of Suspension
of Proposed Effective Date, and Notice of Intervention Deadline. Order No. 35825. The
Commission granted intervention to: Clean Energy Opportunities for Idaho (“CEO”); Idaho
Irrigation Pumpers Association, Inc. (“IIPA”); Industrial Customers of Idaho Power (“ICIP”);
Idaho Hydroelectric Power Producers Trust d/b/a IdaHydro (“IdaHydro”); Micron Technology,
Inc. (“Micron”); Idaho Conservation League (“ICL”); the city of Boise City (“Boise City”); The
United States Department of Energy on behalf of the Federal Executive Agencies (“FEA”); NW
Energy Coalition (“NWEC”); and Walmart Inc. (“Walmart”). Order Nos. 35823; 35840; 35850;
35867, and 35902. On August 2, 2023, the Commission issued a Notice of Schedule, Notice of
Virtual Public Workshops, and Notice of Technical Hearing. Order No. 35873.
On September 18, October 4, and October 5, 2023, Commission Staff (“Staff”), the
Company, and all Intervenors participated in settlement conferences. Based upon those settlement
conferences, at the Commission’s October 10, 2023, decision meeting, Staff informed the
Commission that Staff believed a settlement had been reached in principle amongst the parties in
the case, and Staff requested that the Commission vacate the written testimony deadlines until such
time as a Proposed Settlement was filed for Commission review, or the Commission is informed
that a Proposed Settlement will not be filed. On October 11, 2023, the Commission issued an Order
Vacating Testimony Deadlines. Order No. 35954.
On October 27, 2023, the Company filed a Stipulation and Settlement (“Proposed
Settlement”) and a Motion for Approval of Stipulation and Settlement (“Motion”). The Proposed
ORDER NO. 36042 2
Settlement was signed by Staff, the Company, and all Intervenors (collectively “the Parties”). On
November 2, 2023, the Commission issued a Notice of Proposed Settlement, Notice of Amended
Schedule, Notice of Customer Hearings, Notice of Technical Hearing, and Notice of Public
Comment Deadline. Order No. 35985.
On November 27, 2023, the Commission held a customer hearing in Twin Falls, and on
November 28, the Commission held a customer hearing in Boise. On November 29, 2023, the
Commission held a technical hearing in Boise during which the Commission heard testimony from
the Parties.
TERMS OF PROPOSED SETTLEMENT
Under the Proposed Settlement, the Company’s overall retail revenue will increase by
$54.7 million annually for an average increase of 4.25 percent, which is net of a Power Cost
Adjustment (“PCA”) decrease of $168.3 million and a reduction to annual Energy Efficiency Rider
collection of $3.5 million. Proposed Settlement at 2. The Parties agree that the Proposed Settlement
represents a fair, just, and reasonable compromise of the issues in this proceeding and that the
Proposed Settlement is in the public interest. Id.
The Proposed Settlement sets forth certain revenue requirement adjustments to the
Company’s filed case with accompanying explanation. Id. at 4. The adjustments are summarized
in the table below.
Summary of Stipulated Revenue Requirement Adjustments
(Figures reflect Idaho Jurisdictional Amounts)
Filed Net Revenue Increase: $111,304,981
Stipulated Adjustments Adjustment Impact Net Rate Change
1. Cost of Capital
a. Rate of Return ($23,461,105) $87,843,876
2. Rate Base
b. Test Year Methodology Adjustments ($8,294,557) $79,549,319
c. Battery Augmentation ($2,273,749) $77,275,569
3. Expenses
d. Employee Housing ($136,485) $77,139,084
e. Long-Term Pay at Risk ($5,448,325) $71,690,760
f. General Labor ($8,961,081) $62,729,679
g. Uncollectible Expenses ($1,629,964) $61,099,715
h. Miscellaneous Adjustments ($1,365,132) $59,734,583
i. Non-Specific Reduction ($4,195,215) $55,539,368
ORDER NO. 36042 3
4. Deferrals and Mechanisms
j. Low Income Energy Assistance ($1,324,853) $54,214,516
k. Removal of WRAP Expenses ($585,182) $53,629,334
l. Intervenor Funding Amortization ($235,319) $53,394,015
m. Wildfire Removal and Amortization $1,617,743 $55,011,758
n. Net Power Supply Expense ($291,972) $54,719,786
Id.
The Parties agree to a 9.6 percent return on equity (“ROE”) and a 7.247 percent overall
rate of return (“ROR”) based on a non-specified cost of debt and capital structure, applied to an
authorized Idaho jurisdictional rate base of $3,816,351,478. Id. at 5. However, the Parties do not
agree on any particular cost-of-service methodology and the Proposed Settlement does not request
that the Commission approve a particular cost-of-service methodology. Id. at 9.
The Parties agree that the $54.7 million net revenue increase should be recovered by
implementing tariffs in conformance with Exhibit No. 1 attached to the Proposed Settlement. Id.
The Parties represent that the rate spread was generally developed using a method to increase the
rates for each customer class by a factor at least 0.5 times, but not more than 1.3 times, the overall
4.25 percent increase, with no increase for any customer class above 120 percent of the cost-of-
service index. Id.
The Parties agree, for settlement purposes, to the rate design and tariff provisions included
in Attachment No. 2 to the Motion and set forth in Exhibit No. 2 attached to the Proposed
Settlement, which detail the rate calculations for the various schedules that differ from the
Company’s Application. Id.
The Parties agree that in determining the individual rates for residential Schedules 1,
Residential Service Standard Plan, and 6, Residential Service On-Site Generation, the customer
billing determinants as proposed by the Company will be used but will maintain the current
percentage differential between each block. Id. at 9-10.
Under the Proposed Settlement, the Service Charge for the Company’s Residential Service
class (Schedules 1, 5, and 6) will increase from $5 per month to $10 per month on January 1, 2024,
and to $15 per month on January 1, 2025. Id. at 10. The Service Charge for the Company’s Small
General Service class (Schedules 7 and 8) will increase from $5 to $25 per month on January 1,
2024. Id.
ORDER NO. 36042 4
A summer mid-peak period from 3 p.m. to 7 p.m. is added to residential time-of-use (“TOU”)
offerings contained in Schedules 5, Residential Service Time-of-Use Plan, and 6, Residential
Service On-Site Generation, to generally align with Schedules 9, Large General
Service, and 19, Large Power Service as defined in the respective tariff schedules included in
Attachment No. 2 to the Motion. Id.
Under the Proposed Settlement, the revenue requirement allocated to Schedule 30, U.S.
Department of Energy Special Contract, will be effectuated by setting the demand charge at
$9.75/kW (a 14.71 percent increase from the current demand charge) and the energy charge at
$0.040951/kWh (a 37.84 percent increase from the current energy charge). Id.
The Schedule 8 tariff sheet will be updated to reflect the inclusion of September as part of
the summer season as reflected in Attachment No. 2 to the Motion. Id. The Proposed Settlement
contains provisions concerning Generation Interconnection Charges related to Schedule 72, and
information on Separate Informal Proceedings concerning the feasibility of implementing a
revenue neutral bill protection mechanism. Id. at 10.
The Proposed Settlement also contains Non-Revenue Stipulated Agreements concerning:
Coal-Fired Plant Investments; Capital Investments; the Revenue Sharing Mechanism; the
accumulated deferred investment tax credits Revenue Sharing Mechanism; the PCA; Third Party
Wheeling Tracking; Radial Transmission Line Analysis; Test Year Sales Methodology for Future
General Rate Cases; the Fixed Cost Adjustment; the Sales Based Adjustment Rate; Natural Gas-
Fired Plant Maintenance; and the Wildfire Mitigation Plan. Id. at 12-16.
PUBLIC COMMENTS
As of December 19, 2023, the Commission has received eighty-eight (88) public comments
in this case. Thirty (30) public comments were received prior to the Notice of Proposed Settlement
and fifty-eight (58) public comments were received after the Notice of Proposed Settlement. Of
those fifty-eight (58) comments received after the Notice of Proposed Settlement, twenty-three
(23) of them were untimely submitted.
The majority of the public comments oppose any increase in rates. Customers presented
issues including fixed income, inflation, taxes, corporate compensation, the state of the economy,
and other world issues that present financial hardships for customers. Many comments focused on
the proposed increase to fixed charges and the impact it would have on low use customers.

ORDER NO. 36042 5
PARTY TESTIMONY
A. Staff Testimony
1. Donn English
Staff witness Donn English testified that Staff conducted a comprehensive review of the
Company’s Application, a thorough audit of the Company’s books and records, an analysis of the
Company’s class cost of service study, and extensive negotiations with the Parties to the case. Tr.
vol. IV, 114. Mr. English testified that based upon its review, Staff believes that the Proposed
Settlement offers a reasonable balance between the Company’s opportunity to earn a reasonable
return on its investment and affordable rates for customers, and Staff believes the Proposed
Settlement is in the public interest; is fair, just, and reasonable; and should be approved by the
Commission. Id.
2. Taylor Thomas
Staff witness Taylor Thomas testified that Staff looked at each revenue requirement
adjustment, class cost-of-service study, proposed rate design, and other issues under consideration
and Staff determined that the Proposed Settlement between the Parties was as good or better than
what could be expected by fully litigating the case. Id. at 141. Mr. Thomas testified that based on
its review, Staff believed that the rate stability and certainty, along with the reduced revenue
increases provided in the Proposed Settlement, represents a fair, just, and reasonable compromise
of the positions put forth by the Parties and is in the public interest. Id.
B. CEO Comments
On November 22, 2023, CEO filed Final Comments. CEO stated that the Proposed
Settlement represents a compromise that is just, fair, reasonable, and in the public interest.
C. Boise City Testimony
Boise City witness Wil Gehl testified that the Proposed Settlement represents a
compromise between all Parties, including a significantly lower revenue requirement and
corresponding rate increase than originally requested by the Company, and beneficial
modifications to rate design and rate spread. Id. at 75-76. Mr. Gehl testified that based on its
review, Boise City believes the overall result of the Proposed Settlement is a reasonable and fair
compromise between the Company and its customers; the Proposed Settlement balances customer
interests with the Company’s ability to make necessary investments to support the safe provision
of affordable, clean electricity to its customers; and Proposed Settlement is in the public interest.
Id. at 81-82.
ORDER NO. 36042 6
D. ICL Testimony
ICL witness Bradley Heusinkveld testified that the Parties agreed to the Proposed
Settlement following extensive negotiations and review of the Company’s application, work
papers, discovery, and data requests. Id. at 88-89. Mr. Heusinkveld represented that Staff and the
Intervenors collectively represent a diverse set of customer groups and interests, and that reaching
an agreeable compromise between the Parties necessitated balancing these interests, while
accommodating the Company’s need for cost recovery and financial stability. Id. Mr. Heusinkveld
explained that ICL believes the settlement is a fair compromise and in the public interest, and that
the Parties arrived at moderate reductions in revenue requirement, rate of return, revenue
adjustments, and reasonable alterations to rate design elements. Id.
E. IIPA Testimony
IIPA witness Lance Kaufman testified that IIPA reviewed the opening testimony and
workpapers of all company witnesses, issued discovery on cost of capital, test year expenses, and
cost of service, and developed positions on potentially appropriate adjustments to the Company’s
filed case. Id. at 64-65. Mr. Kaufman represented that all of IIPA’s concerns are either directly
addressed in the Proposed Settlement through changes to revenue requirement and rate spread, or
indirectly through agreement for ongoing collaboration. Id. at 69-70. IIPA recommends that the
Commission find the Proposed Settlement to be fair, just, and reasonable and in the public interest.
Id.
F. Micron Testimony
Micron witness Jessica York testified that the Proposed Settlement is a comprehensive
agreement that represents give and take among the Parties. Id. at 98-99. Ms. York also testified
that the Proposed Settlement resolves the revenue requirement, cost allocation, and rate design
issues that would have likely been raised by the Parties in this proceeding and is a result of
extensive arms-length negotiations between the settling Parties in order to reach a comprehensive
settlement. Id.
G. NWEC Comments
On November 15, 2023, NWEC submitted a letter in lieu of testimony in support of the
Proposed Settlement.
H. Walmart Comments
On November 14, 2023, Walmart submitted a letter in lieu of testimony in support of the
Proposed Settlement.
ORDER NO. 36042 7
I. Company Testimony
Company witness Tim Tatum testified that the Proposed Settlement is in the public interest,
and that from the Company’s perspective, the Proposed Settlement provides the Company with
the ability to update its rates to better reflect current costs and the ability to economically finance
new investments in infrastructure for its system. Id. at 46-47. Mr. Tatum also testified that the
Company believes that the rates that result from the Proposed Settlement are just and reasonable
for its customers. Id.
PETITIONS FOR INTERVENOR FUNDING
A. IIPA
IIPA requests that the Commission grant Intervenor Funding in the amount of $36,081.01
for attorney fees for the work of E. Olsen, paralegal fees, soft costs, and witness fees for L.
Kaufman.
B. CEO
CEO requests that the Commission grant Intervenor Funding in the amount of $3,596.40
for attorney fees for the work of K. Jae.
C. NWEC
NWEC requests that the Commission grant Intervenor Funding in the amount of $2,325.00
for attorney fees for the work of D. Rivas.
D. ICL
ICL requests that the Commission grant Intervenor Funding in the amount of $6,237.50 for
fees for the work of attorneys M. Kellner and M. Nykiel, and by Energy Associate B. Heusinkveld.
COMMISSION FINDINGS AND DECISION
The Commission has jurisdiction over the Company’s Application and the issues in this
case under Title 61 of the Idaho Code including Idaho Code §§ 61-301 through 303. The
Commission is empowered to investigate rates, charges, rules, regulations, practices, and contracts
of all public utilities and to determine whether they are just, reasonable, preferential,
discriminatory, or in violation of any provisions of law, and to fix the same by order. Idaho Code
§§ 61-501 through 503.
In a general rate case, the Company’s intrastate revenue requirement, and every component
of it, both rate base and expense, are at issue. IDAPA 31.01.01.124.01. The Commission may
grant, deny, or modify the revenue requirement requested and may find a revenue requirement
different from that proposed by any party is just, fair, and reasonable. Id.
ORDER NO. 36042 8
The Company’s retail rates and charges, both recurring and non-recurring, including those
of special contract customers, are at issue, and every component of every existing and proposed
rate and charge is at issue. IDAPA 31.01.01.124.02. The Commission may approve, reject, or
modify the rates and charges proposed and may find that rates and charges different from those
proposed by any party are just, fair, and reasonable. Id.
The Commission’s process for considering settlement stipulations is set forth in its Rules
of Procedure 271-277, IDAPA 31.01.01.271-277. When a settlement is presented to the
Commission, it “will prescribe the procedures appropriate to the nature of the settlement to
consider the settlement.” IDAPA 31.01.01.274. Here, the Commission convened both a technical
hearing and customer hearing on the Proposed Settlement. IDAPA 31.01.01.274. Proponents of a
proposed settlement must show “that the settlement is reasonable, in the public interest, or
otherwise in accordance with law or regulatory policy.” IDAPA 31.01.01.275. The Commission
is not bound by settlement agreements. IDAPA 31.01.01.276. Instead, the Commission “will
independently review any settlement proposed to it to determine whether the settlement is just, fair
and reasonable, in the public interest, or otherwise in accordance with law or regulatory policy.”
Id.
A. Proposed Settlement
The Commission has reviewed the record including the Application, Proposed Settlement,
testimony, public comments, all submitted materials, and the arguments of the Parties. The
Commission notes that the Parties and the public have built a detailed record through discovery,
filings, negotiations, comments, and participation in hearings.
The Commission finds that the Proposed Settlement incorporates input from different
Parties and customers, and the Proposed Settlement attempts to reach a balance between
customers’ desires for a smaller rate increase and the Company’s recovery of the costs it incurs to
provide safe and reliable service as well as an opportunity to earn a fair rate of return. Notably, the
Proposed Settlement, among other things, reduces the Company’s initial proposed base revenue
increase of $111,304,981 to $54.7 million.
The Commission finds that the Proposed Settlement allows the Company to operate
sustainably while reducing the effects of the rate increase on customers, and the Proposed
Settlement represents a responsible approach to costs and rate design, while balancing the unique
circumstances of the Company and the challenges that higher energy costs pose for customers. The
Commission finds that the Proposed Settlement is fair, just, reasonable, and in the public interest.
ORDER NO. 36042 9
B. Intervenor Funding
Intervenor funding is available pursuant to Idaho Code § 61-617A and the Idaho Public
Utilities Commission Rules of Procedure 161-165. Idaho Code § 61-617A(1) provides that it is
the “policy of this state to encourage participation at all stages of all proceedings before the
commission so that all affected customers receive full and fair representation in those
proceedings.” The Commission may award a cumulative amount of intervenor funding not to
exceed $40,000 for all intervening parties in a single case. Idaho Code § 61-617A(2).
Commission Rule 162 provides the form and content of petitions for intervenor funding.
Each petition must contain: (1) an itemized list of expenses broken down into categories; (2) a
statement of the intervenor’s proposed findings or recommendation; (3) a statement showing that
the costs the intervenor wishes to recover are reasonable; (4) a statement explaining why the costs
constitute a significant financial hardship for the intervenor; (5) a statement showing how the
intervenor’s proposed recommendations differed materially from the testimony and exhibits of the
Staff; (6) a statement showing how the intervenor’s recommendation or position addressed issues
of concern to the general body of the utility users or consumers; and (7) a statement showing the
class of customer on whose behalf the intervenor appeared. IDAPA 31.01.01.162.
1. IIPA
IIPA is an Idaho nonprofit corporation representing farm interests in electric utility rate
matters in southern and central Idaho. IIPA relies solely upon dues and contributions voluntarily
paid by members, together with intervenor funding, to support its activities. Based upon our review
of IIPA’s petition, the Commission finds that the funding request complies with the procedural
and substantive requirements of the statute and the rules. The Commission finds that IIPA has
materially contributed to the Commission’s decision-making; IIPA’s participation added a unique
and well-informed perspective to the record; and it is fair, just, and reasonable to award intervenor
funding. The Commission finds it appropriate to award IIPA intervenor funding in the amount of
$27,841.10. The award shall be chargeable to the irrigation class. Idaho Code § 61-617A(3).
2. CEO
CEO is a nonprofit organization that represents its members and supporters who are Idaho
Power ratepayers. CEO does not have a direct financial interest in the outcome of this case that is
distinct from a ratepayer. Based upon our review of CEO’s petition, the Commission finds that the
funding request complies with the procedural and substantive requirements of the statute and the
rules. The Commission finds that CEO has materially contributed to the Commission’s decision-
ORDER NO. 36042 10
making; CEO’s participation added a unique and well-informed perspective to the record; and it
is fair, just, and reasonable to award intervenor funding. The Commission finds it appropriate to
award CEO intervenor funding in the amount of $3,596.40. The award shall be chargeable to the
irrigation, residential, and small commercial classes. Idaho Code § 61-617A(3).
3. NWEC
NWEC represents over one hundred (100) member organizations in the Northwest,
including eleven in Idaho, to pursue sustainable and equitable energy policy, and is funded through
membership dues and individual donations. Based upon our review of NWEC’s petition, the
Commission finds that the funding request complies with the procedural and substantive
requirements of the statute and the rules. The Commission finds that NWEC has materially
contributed to the Commission’s decision-making; NWEC’s participation added a unique and
well-informed perspective to the record; and it is fair, just, and reasonable to award intervenor
funding. The Commission finds it appropriate to award NWEC intervenor funding in the amount
of $2,325.00. The award shall be chargeable to the residential and small commercial classes. Idaho
Code § 61-617A(3).
4. ICL
ICL is a non-profit organization primarily funded through membership donations, private
grants, endowment fund revenue, and ICL does not have a direct financial interest in the outcome
of this case that is distinct from a ratepayer. Based upon our review of ICL’s petition, the
Commission finds that the funding request complies with the procedural and substantive
requirements of the statute and the rules. The Commission finds that ICL has materially
contributed to the Commission’s decision-making; ICL’s participation added a unique and well-
informed perspective to the record; and it is fair, just, and reasonable to award intervenor funding.
The Commission finds it appropriate to award ICL intervenor funding in the amount of $6,237.50.
The award shall be chargeable to the general residential class. Idaho Code § 61-617A(3).
ORDER
IT IS HEREBY ORDERED that the Motion and Proposed Settlement are approved as filed
with attachments. The Company is authorized to implement revised tariff schedules consistent
with the terms of the Proposed Settlement, effective January 1, 2024.
IT IS FURTHER ORDERED that IIPA’s petition for intervenor funding is granted in the
amount of $27,841.10.
ORDER NO. 36042 11
IT IS FURTHER ORDERED that CEO’s petition for intervenor funding is granted in the
amount of $3,596.40.
IT IS FURTHER ORDERED that NWEC’s petition for intervenor funding is granted in
the amount of $2,325.00.
IT IS FURTHER ORDERED that ICL’s petition for intervenor funding is granted in the
amount of $6,237.50.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days of the service date upon this Order regarding any
matter decided in this Order. Within seven (7) days after any person has petitioned for
reconsideration, any other person may cross-petition for reconsideration. Idaho Code §§ 61-626.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this 28th day of
December 2023.

__________________________________________
ERIC ANDERSON, PRESIDENT

__________________________________________
JOHN R. HAMMOND JR., COMMISSIONER

__________________________________________
EDWARD LODGE, COMMISSIONER

ATTEST:

_________________________________
Monica Barrios-Sanchez
Interim Commission Secretary

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