IPC97v3.docx

DECISION MEMORANDUM
TO:COMMISSIONER NELSON
COMMISSIONER SMITH
COMMISSIONER HANSEN
MYRNA WALTERS
TONYA CLARK
DON HOWELL
STEPHANIE MILLER
DAVID SCHUNKE
DAVID SCOTT
WORKING FILE
FROM:BEVERLY BARKER
DATE:OCTOBER 31, 1997
RE:TARIFF ADVICE NO.  97-3
REVISIONS TO RULE F AND SCHEDULE 66
COMPANY REQUEST
Idaho Power proposes to make several changes to its Account Processing Charge.  Currently, the Account Processing Charge applies to instances where a customer is applying for service for the first time at a particular address as well as to instances where a customer is reestablishing service after a seasonal or involuntary disconnection.  The Company wants to have separate charges for these two types of transactions ‒ an Account Initiation Charge and a Reconnection Fee.   The charges corresponding to fixed time periods would be the same.
The Company is proposing to retain the current charge of $15 for connection or reconnection during regular hours of operation, but intends to expand the applicable time period from the current 8:00 a.m to 5:00 p.m. Monday through Friday to 7:30 a.m. to 6:00 p.m. Monday through Friday.  This change would allow an additional 1½ hours per day during which services would be performed at minimal cost to the customer.  The proposed time period corresponds to the hours of operation of the Company’s Customer Service Center, which would be handling requests for connection and reconnection.
The Company also proposes to establish two tiers of after-hours charges.  Currently, customers pay $22 for reconnections performed at times other than 8:00 a.m. to 5:00 p.m. Monday through Friday.  The Company wants to charge $45 for the 6:01 p.m. to 9:00 p.m. period and $80 from 9:01 p.m. to 7:29 a.m.  Field personnel dispatched during either of these time frames receive overtime wages.  Due to an increase in late night incidents that pose a threat to employees’ safety, the Company now sends out two employees during the later time period, doubling the cost of dispatching during those hours.  
STAFF ANALYSIS & RECOMMENDATION
Staff supports the Company’s request to split its Account Processing Charge and rename each component because the new names more accurately reflect the services being provided.  Staff supports the expansion of the “regular hours” period, and notes that the Company will actually be incurring some overtime costs even during regular hours in instances where customers request service before 6:00 p.m. but field personnel actually perform the work after 6:00 p.m. Staff has verified that the proposed increase in after-hours charges corresponds to the costs incurred by the Company to perform connections and reconnections during that time.  The Company’s increase in revenue resulting from the proposed charges is neglible due to the relatively small number of after-hours requests anticipated.
Staff is concerned about the magnitude of the increase in after-hours charges and the potential impact on customers who have been disconnected for non-payment.  Customers experiencing financial difficulties are likely to find an additional $45 or $80 fee an insurmountable obstacle to reinstatement of service.  However, customers are provided with at least two written or oral disconnection notices prior to actual disconnection, and are given the opportunity to make payment arrangements for less than the full amount owing.  The Company anticipates that regardless of account  status, most customers will chose to be connected or reconnected during regular office hours when the charge is substantially lower.  If the Commission is concerned about the impact on customers who have been disconnected for non-payment, then Staff recommends that either the fee for the first after-hours tier (6:01 p.m. to 9:00 p.m.)  be reduced to a more affordable amount or the hours during which it is applicable altered.  The later could be accomplished by expanding the hours during which regular-hours charges apply.  Staff recommends no change in the proposed second tier (9:01 p.m. to 7:29 a.m.) after-hours rates because the Company has demonstrated that its costs are significantly higher during that time period.
COMMISSION DECISION
Does the Commission approve the request to eliminate the Account Processing Charge and establish in its stead an Account Initiation Charge and a Reconnection Fee?  Does the Commission approve the expansion of the regular hours of operation during which a $15 charge applies?  Does the Commission approve the establishment of two after-hours time periods and the $45 and $80 charges as proposed by Idaho Power?
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